Mahwikizi v. Uber Techs.

1

Justin Mahwikizi, Plaintiff, v. Uber Technologies, Inc. and Rasier, LLC, Defendants.

No. 22 C 3680

United States District Court, N.D. Illinois, Eastern Division

March 6, 2023

MEMORANDUM OPINION AND ORDER

Honorable Thomas M. Durkin United States District Judge

Justin Mahwikizi brought this pro se action against Defendants Uber Technologies, Inc. (“Uber”) and its wholly owned subsidiary Rasier, LLC (“Rasier”) (collectively “Defendants”), alleging various federal and state law claims related to Uber's mask-wearing policy and classification of drivers as independent contractors. Defendants have moved to compel arbitration. For the following reasons, Defendants' motion [16] is granted.

Background

Uber operates a ridesharing platform that matches individuals in need of a ride with drivers willing to provide transportation based on their location. R. 17-1, Chinchilla Decl. ¶ 8. Uber drivers use the Driver App to connect with riders, but they cannot access the ridesharing platform unless and until they accept the platform access agreement (“PAA”). Id. at ¶¶ 9, 12.

From approximately 2015 to 2022, Justin Mahwikizi worked as an Uber driver in the Chicago area. R. 7, First Amended Complaint (“FAC”) ¶ 11. Most recently Mahwikizi accepted the January 2022 PAA, which contains an arbitration provision. R. 17-1, Chinchilla Decl. ¶ 17. The provision states that it is governed by the Federal Arbitration Act, 9 U.S.C. §§ 2-4 (“FAA”) and applies to all claims between a driver and the company. R. 17-1, Exhibit A to Chinchilla Decl. § 13. The PAA also provides that agreeing to the arbitration provision is not mandatory, that Uber drivers can opt out via email within 30 days, and that the provision survives the termination of a driver's relationship with the company. Id. Mahwikizi did not opt out of the arbitration provision within 30 days or at any time thereafter. R. 17-1, Chinchilla Decl. ¶ 20.

In February 2022, Uber deactivated Mahwikizi's Driver App account for purportedly violating Uber's mask-wearing policy. R. 7, FAC ¶ 49; R. 17, Mem. ISO Mot. to Compel Arbitration ¶ 17. Mahwikizi, proceeding pro se filed this suit as “a collective action under 29 U.S.C § 216(b), and as a class action under Federal Rule of Civil Procedure 23(b)(1).” R. 1, Complaint ¶ 1. The Court dismissed his Complaint without prejudice because a pro se plaintiff may not represent the interests of other plaintiffs in a collective or class action. See R. 5. Mahwikizi then filed his FAC alleging violations of the Fair Labor Standards Act, the Illinois Minimum Wage Act, the California Unfair Competition Law and Common Carrier Law, unjust enrichment, promissory estoppel, breach of contract, and tortious interference with contractual and/or advantageous relations.^[1]See R. 7, FAC.

On August 25, 2022, defense counsel asked Mahwikizi whether he would voluntarily dismiss the FAC and stipulate to arbitration based on his acceptance of the January 2022 PAA. See R. 17, Exhibit 2. After Mahwikizi declined, Defendants brought this motion to compel arbitration and stay proceedings pursuant to the FAA. See R. 16.^[2]

Legal Standard

The FAA “governs the enforcement, validity, and interpretation of arbitration clauses in commercial contracts in both state and federal courts.” Jain v. de Mere, 51 F.3d 686, 688 (7th Cir. 1995). The FAA was enacted to replace “widespread judicial hostility” to the enforcement of arbitration agreements with “a liberal policy favoring arbitration.” AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011). The FAA thus “sweeps broadly, ‘requiring courts rigorously to enforce arbitration agreements according to their terms.'” Wallace v. Grubhub Holdings, Inc., 970 F.3d 798, 800 (7th Cir. 2020) (quoting Epic Sys. Corp. v. Lewis, 138 S.Ct. 1612, 1621 (2018)). But there are limits to its coverage. Relevant here, Section 1 of the FAA provides that “nothing herein contained shall apply to contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” 9 U.S.C. § 1.

To compel arbitration under the FAA, this Court must find “[1] a written agreement to arbitrate, [2] a dispute within the scope of the arbitration agreement, and [3] a refusal to arbitrate.” See Zurich Am. Ins. Co. v. Watts Indus., Inc., 417 F.3d 682, 690 (7th Cir. 2005). The party opposing arbitration bears the burden of establishing why the arbitration provision should not be enforced. Green Tree Financial Corp.-Alabama v. Randolph, 531 U.S. 79, 91 (2000); Wallace, 970 F.3d at 803.

A motion seeking dismissal pursuant to an arbitration agreement is best conceptualized as an objection to venue and thus properly brought under Rule 12(b)(3). See Automobile Mechanics Local 701 Welfare and Pension Funds v. Vanguard Car Rental USA, Inc., 502 F.3d 740, 746 (7th Cir. 2007). Generally, in considering Rule 12(b)(3) motions, a court must construe all facts and draw all reasonable inferences in favor of the plaintiff, unless the defense offers evidence to the contrary. Faulkenberg v. CB Tax Franchise Systems, LP, 637 F.3d 801, 806 (7th Cir. 2011). If the parties submit evidence outside of the pleadings, a court may consider it without converting the motion into one for summary judgment. Id. at 809- 10.

Analysis

Mahwikizi does not dispute that he agreed to the arbitration provision or argue that his failure to opt out should be excused, that the provision is unenforceable under Illinois law, or that his claims are outside of its scope.^[3]Rather, Mahwikizi asserts that he is exempted under Section 1 of the FAA because, as an Uber driver, he was a member of a “class of workers engaged in foreign or interstate commerce.” R. 24 at 1.

To determine whether Mahwikizi falls within the residual clause of Section 1, the Court must first define the relevant “class of workers” and then determine whether that class of workers is “engaged in foreign or interstate commerce.” Southwest Airlines Co. v. Saxon, 142 S.Ct. 1783, 1788 (2022). The focus of the first step is on the class of workers, not the employer. Id. In other words, Mahwikizi is a member of a class of workers based on what he does as an Uber driver, not what Defendants do generally. Id. The inquiry at the second step is whether that class is “actively engaged” in the transportation of goods across borders through the channels of foreign or interstate commerce. See id. at 1790 (citations omitted). At this step, the Court “consider[s] whether the interstate movement of goods is a central part of the class members' job description.” Wallace, 970 F.3d at 801.

Because the parties do not dispute the class of workers is Uber drivers nationwide, the Court turns to the question of whether that class is engaged in interstate commerce. As Defendants point out and as Mahwikizi recognizes, the overwhelming majority of courts across the country that have considered this precise question have concluded that rideshare drivers are not engaged in interstate commerce within the meaning of Section 1. See, e.g., Cunningham v. Lyft, 17 F.4th 244 (1st Cir. 2021); Capriole v. Uber Technologies, 7 F.4th 854 (9th Cir. 2021); Leaks v. Uber Techs., Inc., No. 20 C 6423 (N.D. Ill. Feb. 22, 2022);^[4] Davarci v. Uber Technologies, No. 20-CV-9224, 2021 WL 3721374 (S.D.N.Y. Aug. 20, 2021); Osvatics v. Lyft, Inc., 535 F.Supp.3d 1 (D.D.C. 2021); Rogers v. Lyft, Inc., 452 F.Supp.3d 904 (N.D. Cal. 2020), aff'd, No. 20-15689, 2022 WL 474166 (9th Cir. Feb. 16, 2022); Aleksanian v. Uber Techs., Inc., 524 F.Supp.3d 251 (S.D.N.Y. 2021). Their reasoning is equally applicable here.

Uber drivers provide transportation services that are predominately local and intrastate in nature. Of all trips taken through the Uber platform between 2015 and 2021, approximately 97.54% started and ended in the same state, and the average trip was 6.32 miles and 16.41 minutes in duration.^[5]R. 25-1, Exhibit 4 ¶ 4. While Mahwikizi asserts that he and other drivers “frequently” take riders across state lines, the only evidence he offers in support is his own estimation that he transported riders across state lines on a daily basis. R. 24-1 ¶¶ 4, 7. The data does not support his estimation,^[6] but even if it did, his experience is not determinative of whether the class of Uber drivers to which he belongs is engaged in interstate commerce for the purpose of Section 1 of the FAA. See Wallace, 970 F.3d at 798; see also Aleksanian, 524 F.Supp.3d at 261.

Still Uber drivers sometimes cross state lines. In International Brotherhood of Teamsters Local Union No. 50 v. Kienstra Precast, Inc., the Seventh Circuit held that cement truck drivers who crossed state lines on roughly two percent of their delivery trips fell within the Section 1 exemption. 702 F.3d 954, 958 (7th Cir. 2012); see also Cent. States, Se. & Sw. Areas Pension Fund, 84 F.3d 988, 993 (7th Cir. 1996). Mahwikizi argues that under this standard, the percentage of drivers' trips that involve crossing state lines (approximately 2.46%) is sufficient. But more recently in Wallace, the Seventh Circuit clarified the inquiry as whether “the interstate movement of goods is a central part of the class members' job description,” and that “someone whose occupation is not defined by its engagement in interstate commerce does not qualify for the exemption just because she occasionally performs that kind of work.” 970 F.3d at 803 (emphasis added). The Seventh Circuit reiterated this inquiry in Saxon. 993 F.3d 492, 497 (7th Cir. 2021), aff'd, 142 S.Ct. 1783 (“To be engaged in commerce for purposes of § 1, then, is to ‘perform [ ] work analogous to that of seamen and railroad employees, whose occupations are centered on the transport of goods in interstate and foreign commerce.'”) (quoting Wallac...