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Multidistrict litigation panel won’t centralize Uber misclassification suits

By Lisa Milam-Perez, J.D.

Uber drivers challenging their independent contractor status were unable to convince the Judicial Panel on Multidistrict Litigation to consolidate three separate FLSA collective actions currently pending against the rideshare giant in Florida, North Carolina, and Tennessee, as well as 13 potential tag-along actions. All of the suits alleged that Uber misclassified its drivers as independent contractors instead of employees, denying them minimum wage, overtime, and work-related expenses. The plaintiffs in the Florida litigation sought to centralize the cases there; the other plaintiffs (and defendants) opposed the move (In Re: Uber Technologies, Inc. Wage and Hour Employment Practices Litigation, May 30, 2017).

It was the second failed attempt by Uber plaintiffs to centralize a growing wave of “gig” economy wage suits. In February 2016, the panel refused to combine seven misclassification suits brought against Uber under state law, pending in seven different district courts, in a single forum, noting that the standards for determining the drivers’ employment status vary considerably from state to state “and involve a broad range of factors which require consideration of distinct aspects of the alleged employer’s relationship with plaintiffs.”

Here, the drivers attempted to avert this problem by seeking to centralize only the FLSA suits, which were nearly identical nationwide actions brought on behalf of substantially the same drivers, they noted. But there was no way to avoid bringing in actions with significant state-specific issues, the panel concluded, “as two of the three actions on the motion and nearly all potential tag-along actions assert state law claims and putative statewide or citywide classes.” The drivers urged that the panel could separate the state-specific issues and remand those from any centralized MDL action, but that would merely result in duplicative litigation, the panel concluded. In fact, “nearly every action centralized would require separation and remand—ironically, exacerbating the problem of duplicative litigation that centralization is intended to remedy.” Also, 28 U.S.C. § 1407 directs that actions are to be centralized based on “one or more common questions of fact,” not on common questions of law.

The cases here were at very different procedural stages, too, which further weighed against centralization. In the Florida litigation, a trial date had already been set for the fall; in the other cited actions, discovery hadn’t even commenced. The tag-along actions were at varying stages of motions practice, including motions to compel arbitration, or to dismiss. Moreover, voluntary coordination was feasible under the circumstances, since a bulk of the actions (including the tag-alongs) involved two groups of plaintiffs’ firms, and the Uber defendants were represented by the same defense counsel in each case. Therefore, the panel denied transfer.