The Briefcase Diaries

Applebaum v. Lyft

New York has seen a huge rise in third party ride services such as Uber and Lyft in the last several years. I know I’ve personally used Uber and Lyft in cities like Chicago, Washington D.C, New York City, Tampa, Atlantic City and even White Plains. With the news covering stories related to both companies, I thought it was particularly interesting that there is a potential class action suit in NY over tolls.

The plaintiff in this case is filing suit against Lyft for violation of NY General Business Law Section 349, and for unjust enrichment over claims that the company overcharges customers who go through city tolls.[1] The plaintiff specifically alleges that the Lyft drivers charge the cash price for tolls as opposed to the E-Z pass discounted prices.[2] Lyft moved to dismiss the case or alternatively go through arbitration, which was a part of the company’s terms of service.[3] The plaintiff claimed that he was unaware of such terms and did not assent to them. At this point I was thinking to myself, even as a law student, when I download apps, I should read the Terms of Service, but most of the time fail to do so. This topic has been the issue in many cases over the years, and is still frequently litigated.

In this case the issue revolved around an arbitration agreement included in an updated terms of service contract the plaintiff accepted after the suit was filed. After a lengthy analysis of several cases and the facts of this particular case, the District Court judge held that the party’s arguments are moot or without merit, and that Lyft’s motion to compel arbitration was granted.[4] The case will be stayed in court until the arbitration is complete, pursuant to the Federal Arbitration Act.

The opinion can be read here:

[1] Applebaum v. Lyft, Inc., No. 1:2016cv07062 at 1 (S.D.N.Y 2017).

[2] Id.

[3] Id.

[4] Id. at 30.