An Uber passenger injured in a crash is challenging online companies’ ability to force customers into arbitration through terms and conditions that consumers likely haven’t read in a case before the Massachusetts’ Supreme Judicial Court Friday.
William Good sued Uber in 2022, seeking more than $60 million in damages after his driver’s collision on the way home from work left him permanently quadriplegic. But as an Uber customer, Good had checked a box indicating he agreed to the company’s Terms of Use, which contained an agreement that any disputes would be resolved through arbitration.
The Supreme Judicial Court will hear oral arguments Friday in the case. It could have broad implications for rideshare customers in Massachusetts, who took 60 million rides in 2022 but may have no idea that they can’t litigate their disputes in a courtroom.
“We make probably thousands of clicks a day,” said Victoria Santoro Mair, a partner at Sweeney Merrigan Law LLP representing Good. “It’s very very important for consumers to understand what rights they are giving up"—in this case, the right to a jury trial over a life-altering or life-ending injury—"by clicking something with their mouse.”
Good’s case rests on whether a pop-up agreement he clicked while attempting to order an Uber ride constitutes reasonable notice that he would be legally bound to its terms and reasonable manifestation of agreement to those terms. That two-prong standard comes from an 2021 opinion from the Supreme Judicial Court in Kauders vs. Uber.
The agreement stated, “We’ve updated our terms” and “we encourage you to read our updated terms in full” before hyperlinking two documents outlining the terms. To proceed to the app, a user had to press a “confirm” button below a notice stating that, “by checking the box, I have reviewed and agree to the Terms of Use and acknowledge the Privacy Notice.” Customers were not required to click on the hyperlink and scroll through the terms.
The large, bold font size and use of capital letters in the “readily available” terms of use make clear that customers are signing a significant, binding contract, Uber said in a brief. The company also claims it doesn’t need to force a user to scroll through the terms to have an enforceable contract.
“Maybe it would be better if every contract was in size 14 font and written in language that the average person can read and understand, but that’s not what’s required,” said Joshua Nadreau, a Fisher Phillips LLP partner who advises businesses on employment arbitration.
The Superior Court of Suffolk County sided with Good in a 2022 opinion finding that the box he checked in Uber’s app did not constitute an enforceable online contract.
“This has been decided. It has been decided clearly and it has been decided repeatedly,” Santoro said. “It baffles me that we are in this position with Uber appealing a decision that was made under well-settled Massachusetts law.”
The United States Chamber of Commerce wrote an amicus brief supporting Uber, arguing that the Superior Court’s opinion “would unnecessarily limit the ways in which online merchants provide goods and services to Massachusetts users.”
Nadreau said the case is part of a broader trend by the state’s lower courts in opposing arbitration agreements. Uber’s arbitration agreement was also in the spotlight in 2018 after the company announced it would suspend mandatory arbitration for sexual assault and harassment claims following public pressure from the #MeToo movement.
“I feel like there is some level of hostility towards arbitration agreements, and they are willing to entertain creative arguments about how to unwind them either in the consumer context like this is or in the employment context,” Nadreau said.
The Massachusetts Academy of Trial Attorneys said in a brief that “this Court should decline Uber’s invitation to rewrite Kauders and refuse to empower Uber to divest consumers of their fundamental constitutional rights” to a trial by jury.
“If you have to arbitrate as opposed to hire a lawyer and go to court, you’re probably going to lose,” said MATA amicus committee chair Thomas Murphy.
Santoro said litigation is an essential tool to hold business owners responsible “for the foreseeable consequences” of their operations.
The case is Good vs. Uber Tech. Inc., Mass., No. SJC-13490, oral argument 1/5/24.
Continue ReadingTo contact the reporter on this story: Allie Reed in Boston at areed@bloombergindustry.com
To contact the editors responsible for this story: Alex Clearfield at aclearfield@bloombergindustry.com; Andrew Childers at achilders@bloomberglaw.com
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