# SIPERAVAGE v. UBER TECHNOLOGIES, INC.

> District Court, D. New Jersey · June 30, 2021

URL: https://www.frixlaw.com/law-library/cases/10270987

## Case

- **Court:** District Court, D. New Jersey
- **Decided:** June 30, 2021
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10270987

## How later opinions describe it (automated extraction)

- affirming an order enforcing arbitration and a waiver of rights, including any right to proceed as a class against defendant
- holding that “the residual clause of § 1 may extend to a class of transportation workers who transport passengers, so long as they are engaged in interstate commerce or in work so closely related thereto as to be in practical effect part of it”

## Opinion text

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

EDWARD SIPERAVAGE, on behalf Civil Action No. 20-12265
of himself and all other
similarly situated,
OPINION
Plaintiff,

v.

UBER TECHNOLOGIES, INC.,

Defendants.

APPEARANCES:

JAMES A. FRANCIS
JOHN SOUMILAS
JOSEPH GENTILCORE
EDWARD SKIPTON
LAUREN KW BRENNAN
1600 MARKET STREET
SUITE 2510
PHILADELPHIA, PA 19103

Counsel for Plaintiff

STEPHEN ALLEN LONEY, JR.
HOGAN LOVELLS US LLP
1735 MARKET STREET
23rd FLOOR
PHILADELPHIA, PA 19103

Counsel for Defendant Uber Technologies, Inc.

HILLMAN, District Judge
This matter comes before the Court upon Defendant Uber
Technologies, Inc.’s (“Uber”) Motion to Compel Arbitration and
Stay Action. For the reasons expressed below, Uber’s motion
will be granted.
BACKGROUND
The Court draws its facts largely from Plaintiff’s
complaint. In 2015, Plaintiff started driving for Uber and was
driving a Cadillac CTS to complete UberBlack trips. (ECF No. 1-
1 (“Compl.”) at ¶26). In spring of 2017, Plaintiff started
researching options to purchase a vehicle eligible to drive for
Uber BlackSUV, which would increase his income. (Id. ¶28.) In
March 2017, Plaintiff asked Uber for the list of eligible
vehicles for Uber BlackSUV, to which an Uber representative
responded with a list of eligible vehicles, which included the

Chevrolet Tahoe. (Id. ¶¶29-30.) On December 31, 2018,
Plaintiff purchased a 2017 Chevrolet Tahoe in the amount of
$71,373.96 so he could drive for Uber BlackSUV. (Id. ¶31.)
Around August 5, 2019, Uber notified Plaintiff that as of
September 2, 2019, the Chevrolet Tahoe would no longer be
eligible for the Uber BlackSUV service level. (Id. ¶34.) As a
result of the foregoing, Plaintiff on behalf of himself and
others similarly situated, brought a lawsuit against Uber
asserting the following causes of action: (1) breach of
contract; (2) promissory estoppel; and (3) breach of covenant of
good faith fair dealing.

On September 23, 2020, Uber moved to compel arbitration
pursuant to the 2015 Technology Services Agreement (“2015 TSA”)
and 2020 Platform Access Agreement (“2020 PAA”), both of which
Plaintiff executed. The 2020 PAA contains a section entitled
“Arbitration Provision” which immediately thereafter includes
the following statement:
IMPORTANT: PLEASE REVIEW THIS ARBITRATION
PROVISION CAREFULLY, AS IT WILL REQUIRE YOU TO
RESOLVE DISPUTES WITH US ON AN INDIVIDUAL BASIS
THROUGH FINAL AND BINDING ARBITRATION, EXCEPT
AS PROVIDED BELOW. YOU MAY CHOOSE TO OPT OUT
OF THIS ARBITRATION PROVISION BY FOLLOWING THE
BELOW INSTRUCTIONS. THERE ARE AND/OR MAY BE
LAWSUITS ALLEGING CLASS, COLLECTIVE OR
REPRESENTATIVE CLAIMS ON YOUR BEHALF AGAINST
US. IF YOU DO NOT OPT OUT OF THIS ARBITRATION
PROVISION AND THEREFORE AGREE TO ARBITRATION
WITH US, YOU ARE AGREEING IN ADVANCE, EXCEPT
AS OTHERWISE PROVIDED BELOW, THAT YOU WILL NOT
PARTICIPATE IN AND, THEREFORE, WILL NOT SEEK
OR BE ELIGIBLE TO RECOVER MONETARY OR OTHER
RELIEF IN CONNECTION WITH, ANY SUCH CLASS,
COLLECTIVE OR REPRESENTATIVE LAWSUIT. THIS
ARBITRATION PROVISION, HOWEVER, WILL ALLOW YOU
TO BRING INDIVIDUAL CLAIMS IN ARBITRATION ON
YOUR OWN BEHALF.
(ECF No. 23-4 at 15-16)(emphasis in original).
Section 14.1(a) of that arbitration clause provides as
follows:
This Arbitration Provision is a contract
governed by the Federal Arbitration Act, 9
U.S.C. § 1 et seq. and evidences a transaction
involving commerce, and you agree that this is
not a contract of employment involving any
class of workers engaged in foreign or
interstate commerce within the meaning of
Section 1 of the Federal Arbitration Act.
If notwithstanding the foregoing, the Federal
Arbitration Act does not apply to this
Arbitration Provision, the law pertaining to

1 The Court’s Opinion will focus on the 2020 PAA, which as Uber
notes, is currently applicable, and was in effect at the time
Plaintiff filed the action. (ECF No. 22-1 at 5 n.2.)
arbitration agreements of the state where you
reside when you entered into this Agreement
shall apply. Except as it otherwise provides,
this Arbitration Provision applies to any
legal dispute, past, present or future,
arising out of or related to your relationship
with us or relationship with any of our
agents, employees, executives, officers,
investors, shareholders, affiliates,
successors, assigns, subsidiaries or parent
companies (each of which may enforce this
Arbitration Provision as third party
beneficiaries), and termination of that
relationship, and survives after the
relationship terminates.

(ECF No. 23-4 at 16).

Section 14.1(b) of the arbitration clause includes
a delegation provision, which states:
This Arbitration Provision applies to all
claims whether brought by you or us, except as
provided below. This Arbitration Provision
requires all such claims to be resolved only
by an arbitrator through final and binding
individual arbitration and not by way of court
or jury trial. Except as provided below
regarding the Class Action Waiver and
Representative Action Waiver, such disputes
include without limitation disputes arising
out of or relating to interpretation or
application of this Arbitration Provision,
including the formation, scope,
enforceability, waiver, applicability,
revocability or validity of this Arbitration
Provision or any portion of this Arbitration
Provision.

(ECF No. 23-4 at 16).

Section 14.4 of the arbitration provision includes a class
action waiver, which provides:
Class Action Waiver. This Arbitration
Provision affects your ability to participate
in class or collective actions. Both Uber and
you agree to bring any dispute in arbitration
on an individual basis only, and not on a class
or collective basis on behalf of others. There
will be no right or authority for any dispute
to be brought, heard or arbitrated as a class
or collective action, or for you to
participate as a member in any such class or
collective proceeding (“Class Action Waiver
”). Notwithstanding any other provision of
this Arbitration Provision or the JAMS Rules,
disputes in court or arbitration regarding the
validity, enforceability, conscionability or
breach of the Class Action Waiver, or whether
the Class Action Waiver is void or voidable,
may be resolved only by the court and not by
an arbitrator. In any case in which (1) the
dispute is filed as a class or collective
action and (2) there is a final judicial
determination that all or part of the Class
Action Waiver is unenforceable, the class or
collective action to that extent must be
litigated in a civil court of competent
jurisdiction, but the portion of the Class
Action Waiver that is enforceable shall be
enforced in arbitration.

(ECF No. 23-4 at 19-20)(emphasis in original).

DISCUSSION
A. Subject Matter Jurisdiction
This Court has subject matter jurisdiction over this matter
pursuant to 28 U.S.C. § 1332(d), the Class Action Fairness Act
(“CAFA”), which provides, in relevant part, that “district
courts shall have original jurisdiction of any civil action in
which the matter in controversy exceeds the sum or value of
$5,000,000, exclusive of interest and costs, and is a class
action in which . . . (A) any member of a class of plaintiffs is
a citizen of a State different from any defendant.” To the
extent Plaintiff wishes to proceed individually, this Court has
subject matter jurisdiction pursuant to 28 U.S.C. § 1332(a) as
there is complete diversity of the parties and the amount in
controversy exceeds $75,000.
B. Legal Standard
“[W]hen it is clear on the face of the complaint [or
documents relied upon by the complaint] that a validly formed
and enforceable arbitration agreement exists and a party’s claim
is subject to that agreement, a district court must compel
arbitration under a Rule 12(b)(6) pleading standard ....” MZM
Constr. Co. v. N.J. Bldg. Laborers Statewide Benefit Funds, 974

F.3d 386, 406 (3d Cir. 2020). But if (1) the materials subject
to review on a Rule 12(b)(6) motion are unclear as to the
arbitrability question, or (2) the parties have come forward
with facts putting the arbitrability question at issue, then the
court may order limited discovery and then consider the
arbitrability question on a summary judgment standard. Guidotti
v. Legal Helpers Debt Resol., LLC, 716 F.3d 764, 774 (3d Cir.
2013) (quotation marks and citation omitted).
C. Analysis
Uber moves to compel arbitration, primarily relying on the
Federal Arbitration Act (“FAA”), and alternatively, on New

Jersey arbitration law. Plaintiff argues that this Court cannot
compel arbitration pursuant to the FAA because the relevant
class of workers are exempt from application of the FAA, and New
Jersey arbitration law should not apply because the FAA
exemption applies here and “state law may be considered only if
the FAA does not apply.” (ECF No. 38 at 15.) Plaintiff further
argues the Court cannot compel arbitration under New Jersey law
because the arbitration provision is unconscionable for the
following two reasons: (1) the arbitration provision requires
Plaintiff to pay significant arbitration fees; and (2) the
arbitration agreement contains a class action waiver.
Although the FAA authorizes, and in fact requires, courts
to enforce most private arbitration contracts, employment
contracts for “transportation workers” are exempted from the

FAA’s purview. New Prime, Inc. v. Oliveira, 139 S. Ct. 532, 536
(2019); see also 9 U.S.C. § 1 (“[N]othing contained herein shall
apply to contracts of employment of seamen, railroad employees,
or any other class of workers engaged in foreign or interstate
commerce.”). Prior to ordering arbitration pursuant to the FAA,
the Court must first address the question of whether Plaintiff
qualifies for the transportation worker exemption to determine
the enforceability of the parties’ arbitration agreement under
the FAA. A transportation worker, for purposes of the FAA
exemption, is defined as only those “classes of workers who are
actually engaged in the movement of interstate or foreign

commerce or in work so closely related thereto as to be in
practical effect part of it.” Palcko v. Airborne Express, Inc.,
372 F.3d 588, 594 (3d Cir. 2004) (quoting Tenney Eng’g, Inc. v.
United Elec. Radio & Mach. Workers of Am., 207 F.2d 450, 452
(1953)); see also Singh v. Uber Techs. Inc., 939 F.3d 210, 214
(3d Cir. 2019) (holding that “the residual clause of § 1 may
extend to a class of transportation workers who transport
passengers, so long as they are engaged in interstate commerce
or in work so closely related thereto as to be in practical
effect part of it”). Plaintiff, relying on Singh, argues at a
minimum Plaintiff is entitled to discovery relevant to the class
of Uber workers engaged in interstate commerce. In response,
Uber argues the relevant class of workers are not subject to the
FAA § 1 exemption and discovery is not required because “[i]n

the six months since Uber filed its Motion, Plaintiff has failed
to marshal any ‘reliable evidence’ to dispute his agreement to
arbitrate or to identify factual disputes to contest
arbitration.” (ECF No. 39 at 7.) The Court need not resolve
these matters, however, because even if the § 1 exemption
applies, the arbitration provision is nevertheless enforceable
under New Jersey law, for the reasons explained below.
The Court highlights that other courts in this Circuit and
outside of this Circuit have compelled arbitration under state
law without first deciding whether the FAA applies to the
parties’ agreements and merely assuming that the FAA’s

transportation work exemption is applicable. Reese v. Uber
Techs., Inc., No. 18-3300, slip op. at 1 n.1 (E.D. Pa. Mar. 4,
2020), ECF No. 41; Adams v. Parts Distrib. Xpress, Inc., No. 20-
697, 2021 U.S. Dist. LEXIS 52822, at *7-8 (E.D. Pa. March 22,
2021) (“Regardless, the Court need not definitively resolve
whether she qualifies as a transportation worker for purposes of
section 1 of the FAA. For the reasons explained below, even
assuming, without deciding, that Adams was a transportation
worker exempted from the FAA, the Court concludes that the
arbitration agreement is still enforceable under Pennsylvania
law.”); Kauffman v. U-Haul Int’l, Inc., No. 16-4580, 2018 U.S.
Dist. LEXIS 145717, at *5 (E.D. Pa. Aug. 28, 2018) (declining to
resolve the question of whether the parties’ agreement is
covered by the FAA because “even if the [parties’] Agreement is

exempt from the FAA, the Agreement’s arbitration clause is
nevertheless enforceable under Pennsylvania law”); Burgos v. Ne.
Logistics, Inc., No. 15-6840, 2017 U.S. Dist. LEXIS 233939, at
*11 (E.D.N.Y. Mar. 30, 2017) (compelling arbitration under state
law without deciding whether the FAA applies because “regardless
of whether plaintiffs’ claims are exempt from the FAA, the
Arbitration Provision remains enforceable”); Diaz v. Mich.
Logistics Inc., 167 F. Supp. 3d 375, 380–81 (S.D.N.Y. 2016)
(“[T]he Court need not make that determination [of whether the
FAA applies] because the Court agrees with Defendants that, even
assuming that Plaintiffs fall within the § 1 exemption (and the

FAA does not apply), Plaintiffs’ claims are subject to mandatory
arbitration under New York arbitration law.”).
In Reese, the plaintiff argued he should not be compelled
to arbitrate because he is a part of a “class of workers engaged
in foreign or interstate commerce” and thus the FAA does not
apply. Reese, slip op. at 1 n.1. The Court concluded this issue
“need not be resolved here, since the Agreement is enforceable
even if the FAA does not apply.” Id. (emphasis in original).
In reaching this conclusion, the Court adopted the reasoning
from Kauffman, where the Court declined to decide the issue of
whether the FAA’s transportation worker exception applied
because the arbitration agreement was still enforceable under
Pennsylvania law. Id. In Reese, the Court concluded it was
“aware of no grounds that might bar enforcement of the

Agreement’s arbitration provisions” and thus ordered the parties
to arbitration pursuant to Pennsylvania law. Id.
Here, Plaintiff first argues the Court “need not consider
the New Jersey Arbitration Act at all” because Section 1 of the
FAA applies. (ECF No. 38 at 15.) The Court agrees with Uber
that Plaintiff’s position is directly inconsistent with binding
Third Circuit precedent. In Palcko, the Third Circuit held
“[t]here is no language in the FAA that explicitly preempts the
enforcement of state arbitration statutes.” Palcko v. Airborne
Express, Inc., 372 F.3d 588, 595 (3d Cir. 2004); see Volt
Information Sciences, Inc. v. Board of Trustees of Leland

Stanford Junior University, 489 U.S. 468 (1989) (“The FAA
contains no express pre-emptive provision, nor does it reflect a
congressional intent to occupy the entire field of
arbitration.”). Thus, if the § 1 exception applies to a
plaintiff, “the effect of Section 1 is merely to leave the
arbitrability of disputes in the excluded categories as if the
[Federal] Arbitration Act had never been enacted.” Id. at 596
(quoting Mason-Dixon Lines, Inc. v. Local Union No. 560, 443
F.2d 807, 809 (3d Cir. 1971)). In Palcko, after holding that
the Section 1 exemption of the FAA applied, the Third Circuit
held “we see no reason to release the parties from their
agreement” and remanded the case for the District Court to
determine if the arbitration agreement was enforceable pursuant
to state law. Id. at 596. Based on the foregoing case law, the

Court rejects Plaintiff’s position that the Court need not
consider New Jersey law if § 1 of the FAA applies.
Moreover, Plaintiff does not argue that the determination
of whether the matter should be compelled to arbitration
pursuant to the New Jersey law is not ripe until the § 1
analysis is complete. However, this Court is aware of at least
one case within this District where the Court held an
alternative state law argument was not ripe for the Court to
adjudicate until the § 1 exemption analysis was complete. In
Harper, the Court held “[i]f, after discovery, the Court
concludes that the parties’ arbitration agreement is exempt from

the FAA, Defendant may against, move to compel arbitration under
state law arbitration statutes.” Harper v. Amazon.com Servs.,
No. 19-21735, 2020 U.S. Dist. LEXIS 133238, at *21 (D.N.J. July
28, 2020). In reaching this conclusion, the Court relied on
case law where the Court first conducted the FAA analysis and
then reached the state law analysis. Id.
This Court, however, finds the case law referenced above,
which assumed the applicability of the Section 1 exemption
without requiring the parties to engage in months long
discovery, is more in line with the real benefits of enforcement
of individual arbitration provisions recognized by the Supreme
Court. The Supreme Court has found “[i]n individual
arbitration, ‘parties forgo the procedural rigor and appellate
review of the courts in order to realize the benefits of private

dispute resolution: lower costs, greater efficiency and speed,
and the ability to choose expert adjudicators to resolve
specialized disputes.’” Lamps Plus, Inc. v. Varela, 139 S. Ct.
1407, 1416 (2019) (quoting Stolt-Nielsen S.A. v. AnimalFeeds
Int’l Corp., 559 U.S. 662, 685 (2010)). Moreover, the Court
finds whether § 1 exemption applies has “no impact on other
avenues (such as state law) by which a party may compel
arbitration.” Oliveira v. New Prime, Inc., 857 F.3d 7, 24 (1st
Cir. 2017), aff’d, 139 S. Ct. 532 (2019).
This Court’s analysis now turns to Plaintiff’s remaining
arguments regarding why the Court should not compel arbitration

pursuant to New Jersey law. Plaintiff argues the arbitration
agreement is unconscionable because: (1) the arbitration
agreement forces each party to be responsible for their own
costs of arbitration; and (2) the arbitration agreement is
unenforceable because it contains a class arbitration waiver.
In making these arguments, Plaintiff fails to even reference the
delegation provision provided in the 2020 PAA. Accordingly, it
is evident Plaintiff is not attacking the delegation clause
itself.
“Arbitration is a matter of contract and a party cannot be
required to submit to arbitration any dispute which he has not
agreed so to submit.” Murray v. Manorcare-West Deptford of
Paulsboro NJ, LLC, No. 5460-16, 2018 N.J. Super. Unpub. LEXIS
1269, at *10 (App. Div. May 31, 2018) (quoting Bernetich,

Hatzell & Pascu, LLC v. Med. Records Online, Inc., 455 N.J.
Super. 173, 180 (App. Div. 2016) (quoting AT&T Technologies,
Inc. v. Communications Workers of America, 475 U.S. 643, 648
(1986))). “State law governs not only whether the parties formed
a contract to arbitrate their disputes, but also whether the
parties entered an agreement to delegate the issue of
arbitrability to an arbitrator.” Id. (citing Morgan v. Sanford
Brown Inst., 225 N.J. 289, 303 (2016) (citing First Options of
Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995))). “A party
opposing a motion to compel arbitration ‘must mount a specific
challenge to the validity of a delegation clause.’” Id.

(quoting Morgan, 225 N.J. at 305 (citing Rent-A-Center, W., Inc.
v. Jackson, 561 U.S. 63, 72 (2010))); see also Goffe v. Foulke
Management Corp., 238 N.J. 191, 211 (2019) (“Our Court has
acknowledged the legitimacy and applicability of the Rent-A-
Center holding to delegation provisions in New Jersey
arbitration agreements.”). A party cannot avoid arbitration of
the clause’s enforceability simply by attacking the arbitration
clause. “[C]ontesting the validity of an arbitration agreement
as a whole, without specifically disputing the delegation clause
contained therein, is not sufficient to challenge the delegation
provision.” MacDonald v. CashCall, Inc., 883 F.3d 220, 223,
(citing Rent-A-Center, 561 U.S. at 70-75). Instead, the party
must contest the enforceability of the delegation provision by
“challeng[ing] the delegation provision specifically.” Rent-A-

Center, 561 U.S. at 70.
The Third Circuit has held “unless the party opposing
arbitration challenges ‘the delegation provision specifically,’
the district court ‘must treat it as valid’ and ‘must enforce
it’ by sending ‘any challenge to the validity of the underlying
arbitration agreement to the arbitrator.” MXM Constr. Co. v.
N.J. Bldg. Laborers Statewide Benefit Funds, 974 F.3d 386, 399
(3d Cir. 2020) (quoting Rent-A-Center, 561 U.S. at 71-72).
Moreover, the Ninth Circuit has already held that a delegation
clause providing the same carve-out for challenges to the
enforceability of class activity waivers is clear and

unmistakable. Mohamed v. Uber Techs., Inc., 848 F.3d 1201, 1209
(9th Cir. 2016). For the foregoing reasons and pursuant to the
delegation provision, the Court may not address Plaintiff’s
argument that the arbitration argument may not be enforced
because the agreement purportedly forces each party to be
responsible for their own costs of arbitration.
However, the second attack on the arbitration agreement is
directly connected to the supposed unenforceability of class
action waivers under New Jersey law. Accordingly, given the
carve-out in the delegation provision and the 2020 PAA’s class
action waiver provision, which directs questions of
enforceability of the class action waiver to the court, the
Court will determine whether a class action waiver is
enforceable. Plaintiff argues class arbitration waivers are

impermissible under New Jersey law. This Court agrees with Uber
that New Jersey has declined to impose any per se rule against
such waivers. In fact, the New Jersey Supreme Court recently
made clear that the mere inclusion of a class-action waiver is
not impermissible under New Jersey law. Instead, the Court
affirmed the Appellate Division’s decision to distinguish a
matter before it from Muhammad v. County Bank of Rehoboth Beach,
DE, 189 N.J. 1, 15-16 (2006), where the New Jersey Supreme Court
“found unconscionable a class-arbitration waiver embedded in a
consumer contract of adhesion.” Arafa v. Health Express Corp.,
233 A.3d 495, 509 (N.J. 2020); see also Gras v. Assocs. First

Capital Corp., 346 N.J. Super. 42, 57, 786 A.2d 886 (App. Div.
2001) (affirming an order enforcing arbitration and a waiver of
rights, including any right to proceed as a class against
defendant). Here, the Court finds the language of the 2020 PAA,
which is not a consumer contract of adhesion, is a clear and
unambiguous waiver of the Plaintiff’s rights to proceed as a
class against Uber and rejects Plaintiff’s argument that
Muhammad applies here. For the foregoing reasons, the Court
will compel arbitration pursuant to New Jersey law.
CONCLUSION
For the reasons stated above, the Court will grant Uber’s
Motion to Compel Arbitration and Stay Action. An appropriate
Order will be entered.

Date: June 30, 2021 s/ Noel L. Hillman
At Camden, New Jersey NOEL L. HILLMAN, U.S.D.J.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10270987. Public record. Not legal advice.