A Steptoe blog about civil litigation in the Southern District of New York
As part of the ongoing Uber antitrust litigation, Judge Rakoff granted today the defendants’ request to stay the proceeding pending an interlocutory appeal of his prior order denying defendants’ motion to compel arbitration (see our coverage here).
Judge Rakoff noted that the while the defendants had not made a “strong showing” that they would…
In an opinion today, Judge Rakoff denied a motion to compel arbitration of antitrust claims against Uber’s CEO because he found that the arbitration clause was too concealed for the plaintiff to have reasonably agreed to it. (See our prior posts on the case here.)
When a user enters his or her credit card information, there is a button that says “Register,” and below that, in a “barely legible” font, it says: “By creating an Uber account you agree to the Terms of Service and Privacy Policy.” The phrase “Terms of Service” is a hyperlink to terms that include a mandatory arbitration clause.
Judge Rakoff acknowledged that there is extensive case law upholding arbitration agreements when users must click a button stating “I agree” to the terms of use (so called “clickwrap” agreements), but found that the facts here were towards the other end of the spectrum, where the clauses are not enforceable:
Continue Reading Judge Rakoff Rules That Uber’s Customer Arbitration Clause Is Not Conspicuous Enough to Be Enforceable
In the latest chapter of the saga over Uber’s background investigations into an antitrust plaintiff and his counsel (see coverage here), Judge Rakoff has ordered Uber and its investigative firm, Ergo, to cease their background investigations and has enjoined Uber from using any information found during the investigation in the antitrust proceeding. Uber had hired Ergo to investigate the plaintiff and plaintiff’s counsel, an Ergo allegedly made various misrepresentations to gain information from friends and colleagues of the plaintiff and plaintiff’s counsel.
Judge Rakoff did not reach the issue of monetary sanctions, as defendants “have reached an agreement to pay plaintiff a reasonable (though publicly undisclosed) sum in reimbursement of plaintiff’s attorneys’ fees and expenses incurred in conjunction with these matters.” Judge Rakoff described the proceedings as a “sad day” and noted that:
Continue Reading Judge Rakoff Orders Uber Investigative Firm to Stop “Arguably Criminal Conduct,” Uber Will Pay Plaintiff’s Fees
Last week, Judge Rakoff held that a class action of transgender individuals challenging the coverage of gender dysphoria treatments under New York’s Medicaid program will proceed to trial. Specifically, the class challenged the New York Department of Health (“DOH”)’s exclusion of coverage for gender reassignment and hormone therapy for individuals under 18, and a blanket ban on “cosmetic” procedures (even if deemed medically necessary).
Continue Reading Gender Dysphoria Class Action Will Proceed to Trial Before Judge Rakoff
Last week, Judge Rakoff denied a request from the defendants in a group of Petrobras securities cases to stay a September trial date pending the Second Circuit’s consideration of an interlocutory appeal of class certification. The defendants argued that the Second Circuit appeal was on an expedited schedule, and that significant expense could be saved in the event the case had to be re-tried. The plaintiffs opposed the stay, arguing that a delay amid Brazilian political upheaval (including issues of Petrobras’ viability) would only serve to prejudice the plaintiffs.
Continue Reading Judge Rakoff Won’t Stay Petrobras Securities Trial, Calls Delay “Bane” of U.S. Legal System
Yesterday — just hours after Judge Rakoff ordered broad discovery from Uber and its in-house counsel regarding potentially improper investigative techniques — Uber’s CEO moved to compel arbitration in the antitrust class action brought by Uber riders (see previous coverage here). The motion argues that the CEO, as an employee of Uber, is entitled to assert Uber’s arbitration clause in the terms and conditions that each rider agreed to. The motion also argues that the arbitrator, and not Judge Rakoff, should decide the question of arbitrability in the first instance.
Continue Reading On Heels of Inquiry Into Potential Litigation Misconduct, Uber CEO Moves to Have Case Heard in Arbitration
A memorandum order released today reveals that, in an antitrust case against Uber’s CEO (covered here), Judge Rakoff became concerned over improper investigative techniques that Uber (or its agents) employed. Specifically, Uber hired an firm called Ergo to investigate the plaintiff and plaintiff’s counsel, and, in doing so, Ergo’s investigator allegedly made various misrepresentations to gain information, such as claiming that he was a reporter writing a profile of plaintiff’s counsel.
At a hearing (the transcript of which remains nonpublic), Judge Rakoff ordered broad discovery from Uber — including from an Uber in-house attorney — and from Ergo concerning the investigation. In the order released today, Judge Rakoff denied Uber’s motion to reconsider a portion of his ruling calling for in camera review of privileged material as possibly falling within the “crime-fraud” exception to the privilege:
Continue Reading Judge Rakoff Authorizes Discovery from Uber Counsel to Probe Potentially Improper Investigation of Adversary and Opposing Counsel
Today, the Second Circuit reversed Judge Rakoff’s $1.2 billion penalty against Bank of America/Countrywide for FIRREA violations (see our previous coverage here). The case involved allegations that BoA/Countrywide had sold faulty mortgages to Fannie Mae and Freddie Mac, originally brought as a qui tam suit under the False Claims Act in which the government intervened. The Second Circuit’s decision focused on whether the breach of a contractual promise, without further proof of fraudulent intent at the time of contracting, could sustain a claim for fraud. The Second Circuit held that it court not:
Continue Reading Second Circuit Reverses Judge Rakoff’s $1.2 Billion Penalty in BOA-Countrywide FIRREA Litigation
The SEC claims that insider trading defendant Thomas Condradt committed perjury at the trial of his co-defendant Daryl Payton in breach of his cooperation agreement and, instead of the agreed-upon penalty of $2,533, the SEC is now seeking a penalty of almost $3 million. The jury ultimately convicted Payton, even though the SEC was clearly displeased with Conradt. (We have covered this case in several posts, see here, including Mr. Payton’s own troubles with perjury allegations, see here. More color is provided by an article in the WSJ (h/t) today).
The SEC argued that Conradt had to be repeatedly impeached with his prior deposition testimony at trial, at should be punished in a way that deters others from doing the same:
Continue Reading SEC Claims Cooperator Lied At Trial; Seeks To Up Penalty from $2,500 to $3 Million
Last week, Judge Rakoff held that courts should generally be wary of admitting handwriting expert testimony under Federal Rule of Evidence 702. His opinion notes that handwriting analysis, unlike DNA or other forms of scientific evidence, did not arise from scientific inquiry and instead was created solely for use in the courtroom. Judge Rakoff found the expert’s opinion evidence “far too problematic” to be admissible towards determining whether a party’s signature at issue in the case was authentic.
After applying the Daubert factors, Judge Rakoff concluded that:
Continue Reading Judge Rakoff Rejects Handwriting Expert Under FRE 702
