Valdez v. Uber Technologies, Inc.

Background

The plaintiffs filed a proposed class action against Uber Technologies, Inc., and other defendants in San Francisco County Superior Court on October 22, 2020. They requested immediate relief under California Labor Code sections 1101 and 1102, alleging that Uber engaged in coercive and unlawful communications with Uber drivers about their support for Proposition 22.

On October 25, 2020, the defendants removed the case to federal court, asserting jurisdiction under the Class Action Fairness Act of 2005. The plaintiffs then filed a motion for a temporary restraining order and described the removal as likely meritless.

Jurisdictional analysis

The court considered whether it had subject-matter jurisdiction—the legal power to hear the case. Under the Class Action Fairness Act, federal jurisdiction over a class action requires, among other things, more than 100 class members, minimal diversity between the parties, and an amount in controversy exceeding $5 million. The defendants had the burden of showing that removal was proper.

The defendants argued that the amount in controversy exceeded $5 million based on three categories: the value of the requested injunction, possible statutory damages multiplied by the approximately 70,000 drivers they identified as members of the proposed class, and attorney fees.

The court rejected those arguments. First, it found that the requested injunction would impose minimal, if any, costs on Uber. The requested relief would restrict using information gathered from drivers about Proposition 22 to favor or disfavor them in employment-related matters, prohibit false or misleading statements about Proposition 22 on driver applications, and require Uber to provide certain information to California drivers about their political rights. The court found that the requested relief would not shut down Uber’s broader Proposition 22 campaign and that the defendants had not plausibly alleged costs exceeding $5 million.

Second, the court found that no statutory damages were in controversy because the plaintiffs were not seeking monetary damages. Although the complaint referred to injuries and other harms, the court determined that the complaint’s requested relief did not include damages under California Labor Code section 1105 or otherwise. The court distinguished a Supreme Court decision involving a class representative’s attempt to limit damages because this case did not involve a stipulation reducing damages; the plaintiffs were not claiming damages in the first place.

Finally, the defendants did not argue that attorney fees alone would amount to $5 million. The court therefore held that the defendants had failed to plausibly allege that the aggregate value of the requested declaratory and injunctive relief, together with attorney fees, exceeded the jurisdictional threshold.

Disposition

Because federal jurisdiction was absent, Judge Jon S. Tigar ordered that the case be dismissed and remanded to San Francisco County Superior Court. The Clerk was directed to close the file. The order decided the federal court’s jurisdiction and did not decide the merits of the plaintiffs’ underlying claims.