Albert v. Postmates Inc.
3:18-cv-07592
N.D. Cal.
Dec 17, 2018

Background

  • Plaintiffs are current/former Postmates couriers who signed Postmates’ online "Fleet Agreement" containing a mutual arbitration clause with a class/representative-action waiver and a 30-day opt-out window.
  • The court previously found that plaintiff Lee assented to the 2017 Fleet Agreement and did not timely opt out; Postmates updated the agreement in 2018 but did not materially change the arbitration provision.
  • Plaintiffs added two new named plaintiffs, Timmerman and Albert; Postmates moves to compel arbitration as to Timmerman and to dismiss Albert’s claims for failure to state a claim.
  • The FAC alleges misclassification under Dynamex and claims for unreimbursed expenses (Lab. Code § 2802), willful misclassification (Lab. Code § 226.8), unpaid minimum wages, UCL claims, unpaid wages (Lab. Code § 204), and breach of contract (waiting time).
  • Court held Postmates’ click-through procedure gave adequate notice; Timmerman did not validly opt out; the FAA’s transportation-worker exemption (§1) does not apply because couriers made local, intrastate deliveries.
  • Court compelled arbitration for Timmerman (and dismissed Lee and Timmerman without prejudice at plaintiffs’ request), dismissed Albert’s FAC with leave to amend except that Albert’s § 226.8 claim was dismissed with prejudice.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether Timmerman validly agreed to and received conspicuous notice of the Fleet Agreement arbitration clause Timmerman contends arbitration provision was buried and notice insufficient Postmates says click-through presented the agreement text before assent and emailed copies after acceptance Court: notice was sufficient; Timmerman assented and did not timely opt out; arbitration compelled
Whether the FAA §1 "transportation worker" exception applies Plaintiffs argue couriers handle goods that originated out-of-state, so exception applies Postmates says deliveries were local intrastate and company is not interstate carrier Court: exception does not apply; couriers not engaged in interstate commerce
Whether claim for public injunctive relief under the UCL prevents arbitration (McGill issue) Plaintiffs assert public injunctive relief may be a non-waivable statutory right Postmates argues McGill should be limited or ignored and relief cannot be sought in arbitration Court: whether relief is "public injunctive relief" and arbitrability of that remedy are for the arbitrator to decide in the first instance; court does not foreclose arbitration
Whether Albert’s FAC states claims (including whether §226.8 provides private right of action) Albert contends pleadings suffice and §226.8 supports private action Postmates argues Albert lacks specific factual allegations re harm, wages, or expenses and §226.8 creates no private right Court: §226.8 provides no private right — dismissed with prejudice; remaining claims lack individualized factual allegations — dismissed with leave to amend

Key Cases Cited

  • Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002) (questions of procedural arbitrability are for courts unless parties clearly delegate them)
  • Chiron Corp. v. Ortho Diagnostic Sys. Inc., 207 F.3d 1126 (9th Cir. 2000) (two-step FAA analysis: existence and scope of arbitration agreement)
  • Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (federal policy favoring arbitration)
  • AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (enforce arbitration agreements according to their terms; class arbitration tension)
  • Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287 (2010) (arbitration only for disputes parties agreed to submit)
  • Mohamed v. Uber Techs., Inc., 848 F.3d 1201 (9th Cir. 2016) (clear-and-unmistakable delegation of threshold arbitrability issues required)
  • In re Van Dusen, 654 F.3d 838 (9th Cir. 2011) (court must decide applicability of FAA §1 transportation-worker exemption)
  • Johnmohammadi v. Bloomingdale’s, Inc., 755 F.3d 1072 (9th Cir. 2014) (district court may dismiss rather than stay when all claims are subject to arbitration)
  • Dynamex Operations West, Inc. v. Superior Court, 4 Cal.5th 903 (Cal. 2018) (California standard for employee classification)
  • McGill v. Citibank, N.A., 2 Cal.5th 945 (Cal. 2017) (arbitration clause cannot waive ability to seek public injunctive relief under UCL)
  • Noe v. Superior Court, 237 Cal.App.4th 316 (Cal. Ct. App. 2015) (Labor Code §226.8 does not create private right of action, enforcement by Labor Commissioner)
  • Lenz v. Yellow Transp., Inc., 431 F.3d 348 (8th Cir. 2005) (multi-factor test for transportation-worker exemption)
  • Oxford Health Plans LLC v. Sutter, 569 U.S. 564 (2013) (arbitrator may adopt class procedures if parties authorize them)
  • Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662 (2010) (class arbitration procedures must be grounded in parties’ agreement)
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