Stencel v. Lyft, Inc.

Background

Maribeth Stencel alleged that she ordered a Lyft ride on August 6, 2022, began feeling lightheaded, and was sexually assaulted by the driver. She alleged that she later went to a hospital for a sexual-assault examination, reported the incident to police and Lyft, and was told that Lyft had suspended the driver from its platform.

Stencel further alleged that Lyft had known for more than eight years about sexual assaults and rapes by Lyft drivers but inadequately responded by hiring drivers without adequate background checks, allowing culpable drivers to continue driving, and failing to adopt reasonable passenger-safety monitoring procedures.

Her First Amended Complaint asserted ten causes of action against Lyft and 50 unnamed defendants: negligence, misrepresentation, negligent failure to warn, negligent infliction of emotional distress, common-carrier liability, other non-delegable transportation duties, vicarious liability, breach of contract, strict product liability, and violation of California’s Unfair Competition Law. In her opposition, Stencel abandoned her misrepresentation and breach-of-contract claims, as well as claims arising under the Unfair Competition Law.

Motion and Legal Standards

Lyft moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a complaint does not state a legally recognized claim supported by sufficient factual allegations. Lyft also cited Rule 9(b), which requires fraud-based allegations to describe the alleged misconduct with particularity. The court’s discussion addressed Lyft’s request to dismiss the common-carrier, vicarious-liability, and negligent-hiring, supervision, retention, and entrustment theories.

Because the case involved state-law claims in federal court, the court used California’s choice-of-law analysis. It compared Arizona and California law, considered each state’s interest, and applied the law that the parties had shown was applicable under that analysis.

Common-Carrier Liability

The court held that Arizona law applied. Arizona uses the ordinary reasonable-care standard for common-carrier negligence claims, while California requires common carriers to use the highest care and diligence. The court concluded that California lacked a real and legitimate interest in applying its heightened standard because Stencel was not a California resident and was not injured in California, while Arizona had an interest in applying its law.

Under Arizona law, Stencel’s common-carrier claim sought to impose liability for the same negligence alleged in her general negligence claim. The court therefore held that the common-carrier claim was duplicative of the negligence claim and was subject to dismissal.

Vicarious Liability

Stencel alleged vicarious liability under respondeat superior, apparent agency, and ratification. The court addressed these theories under Arizona and California law.

For respondeat superior, the court applied Arizona law and held that Stencel had not adequately alleged that the driver’s sexual assault was within the scope of employment. The court noted that Stencel alleged Lyft suspended the driver after learning of the assault, which essentially negated an inference that Lyft expressly or impliedly authorized the conduct. The respondeat-superior theory was therefore subject to dismissal.

The court also held that the apparent-agency theory was subject to dismissal. Even accepting Stencel’s argument that she did not need to allege Lyft authorized the assault, the court concluded that apparent agency did not create liability where Stencel had not adequately alleged facts supporting liability for the driver’s conduct under respondeat superior.

For ratification, the court concluded that Stencel had not alleged facts showing Lyft knew about the particular driver’s misconduct and accepted its benefits. Her allegations that Lyft generally failed to respond to, investigate, or report sexual misconduct by drivers were not specific to her assault or the driver involved. The ratification theory was therefore subject to dismissal under California law.

Stencel also asserted a vicarious-liability theory under California Public Utilities Code section 535. Because she did not respond to Lyft’s argument concerning that theory, the court found that she had abandoned it.

Negligence

The court applied California law to Stencel’s negligent-hiring, supervision, retention, and entrustment claim because the parties did not show a material difference between Arizona and California law on that issue. Under California law, an employer may be liable for negligent hiring when it knew, had reason to believe, or failed to use reasonable care to discover that an employee was unfit before hiring the employee.

The court agreed with Lyft that Stencel had not alleged anything in the driver’s background or during his employment, before the alleged assault, that should have led Lyft to refrain from hiring or retaining him. Stencel did not respond to that argument, and the court found no allegations making the required showing. That portion of the negligence claim was subject to dismissal.

The court separately stated that, to the extent Stencel based her negligence claim on Lyft’s failure to train and monitor its drivers as a group, that theory was not subject to dismissal. The court found that Stencel had alleged facts supporting an inference that Lyft knew of numerous past sexual assaults and failed to adopt available procedures to reduce that risk.

Disposition

The court granted Lyft’s motion to dismiss. Because Stencel might be able to correct the identified deficiencies, the court granted her leave to amend and set October 1, 2024, as the deadline for filing a Second Amended Complaint. The opinion does not state that the dismissed theories were dismissed with or without prejudice.