Judge Poised to Toss Uber Spying Class Action for Third Time

SAN FRANCISCO (CN) - A federal judge indicated on Thursday she would toss a California man's proposed class action accusing Uber of spying on Lyft drivers to lure them away from its competition.

It would be the third time U.S. Magistrate Judge Jacqueline Scott Corley in San Francisco dismissed the lawsuit, this time for failing to satisfy pleading requirements under the federal Stored Communications Act.

"What you're arguing for is a pretty broad expansion of the SCA," Corley told plaintiff's counsel Caleb Marker in an afternoon hearing, using an acronym for the statute governing data stored by third-party internet service providers.

Michael Gonzalez, a former San Francisco Bay Area Lyft driver, sued Uber in April 2017 after reading an article about the company’s alleged spying activity in tech-news publication The Information.

According to the article, Uber created fake Lyft rider accounts and used spyware called Hell to intercept the information Lyft sent those accounts, allowing Uber to access a driver’s Lyft identification number and to track the driver’s location over time.

Uber then combined Lyft’s data with its own driver-location data to determine which Lyft drivers also worked for Uber. Their names went on lists distributed to Uber’s city managers, who targeted them for bonuses and steered more ride requests to them so they would devote more work-time to Uber.

Corley was interested in one key question Thursday – had Gonzalez pleaded Uber gained unauthorized access of communications stored by Lyft for backup protection, as required by the Stored Communications Act?

The judge said although Gonzalez’s claims that Lyft stored the communications were plausible, he had not convinced her it had done so for backup purposes.

Marker, who is with Zimmerman Reed, countered Lyft's privacy policy states the company stores communications for multiple purposes, including complying with government investigation requests.

But Corley said both Ninth Circuit case law and the statute itself require two copies of the data: the underlying data and the backup.

"I see where the underlying data is; it's at Lyft. Where's the backup?" she said.

Marker had no answer. But he explained that technology companies like Lyft invariably back up their data to comply with government investigations.

Pushing for dismissal, Uber attorney Kevin Underhill of Shook, Hardy & Bacon pointed out that despite Gonzalez’s claims Lyft sends a copy of the data to riders, riders can't save the data, precluding the creation of a backed-up version.

"You're certainly right there is no backup," Underhill told Corley.

Corley nonetheless suggested she may allow Gonzalez to amend his Stored Communications Act claim to strengthen his allegations.

Marker, however, said there was nothing more to add without discovery. He argued the claim was sufficient, because the alleged copies of the data are actually backups.

"Why not consider copies a backup," he said, adding that "almost any piece of data...is being backed up."

Corley appeared unconvinced.

"The Justice Department would be interested in this argument," she quipped.

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