In Re Uber FCRA Litigation
3:14-cv-05200
N.D. Cal.May 2, 2018Background
- Plaintiffs sued Uber alleging unlawful procurement/use of consumer background reports in violation of the FCRA and related state laws; case resolved by a $7.5 million common fund settlement with class notice and claims process.
- Class defined as all persons whose background check/consumer report was requested by Uber before Jan. 3, 2015; split into ADR Group (subject to arbitration) and Court Group (not). ADR Group ~424,125; Court Group ~601,829.
- Notice program: ~1,024,270 emails sent; ~99,243 valid claims submitted (≈10% response); 216+ opt-outs initially; additional targeted notice sent to 108 members after counsel-filed objections.
- Settlement provides net distributions to claimants (approx. ~$73.99 for Court Group; ~$32.15 for ADR Group before final adjustments), non-monetary relief (limited policy change), PAGA payment ($7,500 total), and Uber pays administration costs separately.
- Releases cover claims arising from the operative complaint and related background-check claims based on the same factual predicate; class members retain ability to opt out and pursue individual ICRAA statutory claims.
- Court granted final approval of settlement; approved reduced service awards for class representatives in part; awarded attorneys’ fees at the Ninth Circuit 25% benchmark rather than the 33% requested.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether settlement is fair, reasonable, adequate under Rule 23 | Settlement is a reasonable recovery given litigation risks, produced substantial claims participation and some policy relief | Settlement is adequate and resolves classwide FCRA/state-law claims | Approved: court finds settlement fair, reasonable, adequate |
| Whether classwide predominance under Rule 23(b)(3) is met given state-law variations (per In re Hyundai) | Plaintiffs: common questions (notice, authorization, summary of rights, copies before adverse action) predominate; state statutes materially similar | Objectors: variations in state law (remedies) defeat predominance and class settlement | Overruled objection: court finds common nucleus of fact/law and that variations do not defeat predominance |
| Scope of release (release of additional state claims e.g., ICRAA statutory damages) | Release limited to claims arising from allegations in complaint; members may opt out to pursue individual statutory claims | Objection: release is overbroad and extinguishes individual statutory remedies (e.g., ICRAA $10,000) | Approved: release permissible when based on identical factual predicate; opt-out protects individual statutory claims |
| Attorneys’ fees request (one-third of fund) | Class counsel: 33% fee justified; lodestar supports negative multiplier | Objection: results modest (small per-class recovery, limited policy relief), so benchmark 25% appropriate | Granted in part: court awards fees at 25% benchmark (~$2,025,000) and awards reduced service payments |
Key Cases Cited
- In re Syncor ERISA Litig., 516 F.3d 1095 (9th Cir. 2008) (public policy favors class settlements)
- Staton v. Boeing Co., 327 F.3d 938 (9th Cir. 2003) (court must assess fairness, reasonableness, adequacy of class settlements)
- Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) (factors for evaluating class settlements; commonality/predominance discussion)
- Churchill Village, L.L.C. v. Gen. Elec., 361 F.3d 566 (9th Cir. 2004) (list of factors for fairness inquiry)
- In re Hyundai & Kia Fuel Econ. Litig., 881 F.3d 679 (9th Cir. 2018) (variation in state law does not necessarily preclude Rule 23(b)(3) class certification)
- Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367 (1996) (courts may approve releases that preclude other fora when based on same factual predicate)
- Williams v. Boeing Co., 517 F.3d 1120 (9th Cir. 2008) (release of claims based on identical factual predicate permissible for comprehensive settlement)
- Vizcaino v. Microsoft Corp., 142 F. Supp. 2d 1299 (W.D. Wash. 2001) (factors relevant to fee awards and consideration of results achieved)
- Castano v. Am. Tobacco Co., 84 F.3d 734 (5th Cir. 1996) (predominance inquiry and common nucleus of operative facts)