Calif. Cabbies Can Take On Uber Safety Claims

SAN FRANCISCO (CN) - A federal judge gave a green light for cab companies to continue their lawsuit against Uber over its allegedly false claims on ride safety.

A group of 19 cab companies in California sued Uber Technologies Inc. and its venture-capital funder Raiser LLC in March, saying the ride-sharing company lied about offering "the safest rides on the road" on its website, in advertisements and media statements.

The cab companies argue that in reality they offer safer rides than Uber, according to the March 18 complaint. They say they put drivers through more rigorous background checks, make drivers take safety classes and exams, adhere to more stringent vehicle inspection standards and forbid employees from working for more than one driving company, which they say can serve as a distraction for drivers.

Uber urged the judge to dismiss this case, arguing its ads touting safety amounted to "non-actionable puffery."

The ride-hailing upstart described one ad touting "Background checks you can trust" as a general, subjective statement that makes no specific claim about Uber's services. The popular ride-sharing company contends many of its ads were "generalized statements of aspiration and optimism and therefore non-actionable puffery."

However, U.S. District Judge Jon Tigar disagreed.

"The challenged statements do not merely assert that Uber places a high priority on safety," Tigar wrote in his July 17 ruling. "They also incorporate assertions that a reasonable consumer might rely on based in fact."

Tigar pointed to one Uber ad in which the company emphasizes its commitment to "improving the already best-in-class safety and accountability of the Uber platform, for both riders and drivers." He said a reasonable consumer could conclude that "best-in-class safety" is an objective fact.

"Because the statements they claim to be aspirational are plausibly measureable factual claims, defendants' motion to dismiss is denied," Tigar wrote.

However, the judge also dismissed one of the cab companies' claims, ruling they lack standing to seek relief under California's unfair competition law.

The law requires plaintiffs prove they were injured by relying on the false statements made. In this case, the judge said customers relied on those statements, not the cab companies.

Tigar also dismissed the cabbies' claims over statements Uber made to the media, concluding those statements were "inextricably intertwined" with the fully protected speech of reporters' coverage of issues of public concern.

The cab companies have until Aug. 3 to file an amended complaint.

Their attorney, Benjamin Shiftan of Pearson Simon & Warshaw of San Francisco, said he and his clients are pleased with the court's ruling and looking forward to litigating the case and starting the discovery process.

"We're still in the process of digesting the court's order, but we're looking forward to moving forward with the case," Shiftan said.

Attorneys for Uber at Irell & Manella in Newport Beach did not immediately return a request for comment.

In a separate lawsuit over Uber's unwanted recruitment text messages - that also started the application process to drive for Uber - Tigar dismissed one of the lead plaintiffs from the action because she had voluntarily given Uber her cellphone number.

The judge advanced the case for the other plaintiffs who had asked Uber to stop sending them text messages without success, however.

Follow @NicholasIovino

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