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Bradshaw v. Uber Technologies, Inc.

United States District Court, W.D. Oklahoma

June 6, 2017

KEVIN BRADSHAW, individually and on behalf of all others similarly situated, Plaintiff,
v.
UBER TECHNOLOGIES, INC. and RASIER, LLC, Defendants.

          ORDER

          DAVID L.RUSSELL UNITED STATES DISTRICT JUDGE

         Plaintiff in this putative class action asserts claims under Oklahoma and federal law against Uber Technologies, Inc., and Rasier, LLC, a related entity, referred to collectively by Plaintiff as “Uber”. Before the Court are Defendants' Motion for Judgment on the Pleadings (Doc. No. 48) and their Request for Judicial Notice (Doc. No. 49). The Request for Judicial Notice drew no opposition from Plaintiff and the Court therefore grants the request. Plaintiff filed his opposition to the Motion for Judgment on the Pleadings and Defendants filed a reply brief in support thereof. Accordingly, the motion is at issue and ripe for consideration. Having considered the parties' submissions, the Court finds as follows.

         Uber is a ride sharing service. Uber drivers, including Plaintiff, secure fare riders via Uber's mobile application. As described by other courts in the context of similar lawsuits, the application matches a rider with an available Uber driver in the vicinity and informs the rider of the estimated fare. If the rider accepts the fare, the available Uber driver is dispatched to the rider. At the end of the ride, the passenger completes the transaction by paying Uber through the mobile application. Uber remits to the driver a percentage of the fare paid to Uber by the rider, on a weekly basis.

         Mr. Bradshaw began driving UberX in February 2014, and continues to do so. Complaint, ¶ 27. Plaintiff contends Uber misclassifies its drivers as independent contractors rather than employees, doing so in order to avoid state and federal requirements regarding minimum wage, overtime compensation, and expense reimbursement. Plaintiff contends that Uber controls the drivers' wages, hours, working conditions, and qualifications, and that it monitors their performance. An Uber driver is rated by an Uber rider, based on a five-star rating scale. If an Uber driver fails to maintain a rating of 4.5 out of 5 stars, the driver is in danger of deactivation of his Uber account, which prevents the driver from matching with Uber riders. As a result of the above, Plaintiff contends that Uber drivers should be considered employees not independent contractors, and that as a result, they are entitled to additional compensation.

         Mr. Bradshaw alleges that on average he drives thirty hours per week. Id. at ¶ 28. In 2015 Plaintiff contends he drove 40, 000 miles, grossing $23, 872.00. His net, after expenses, however was $372.00. Plaintiff alleges he incurred expenses in the course of driving for Uber, including fuel, insurance, cleaning, and maintenance costs, for which he was not reimbursed by Uber. He contends that despite working 1500 hours in 2015 he was not paid overtime for the weeks in which he worked in excess of 40 hours, nor was his compensation sufficient to comport with the federal minimum wage requirement. Plaintiff also complains that Uber falsely informs riders that a component of the fare is a gratuity for the driver, and thus tipping is not necessary. Finally, Plaintiff contends that Uber misled him in its marketing materials, whereby it guaranteed a person could earn $2000 per week driving Uber. Based on these allegations Plaintiff alleges eight causes of action, some of which encompass more than one claim. Specifically he seeks to recover on his behalf and on behalf of similarly situated persons on theories that (1) Defendants violated the Oklahoma Minimum Wage Act and the Oklahoma Administrative Code regarding payroll records, OAC 380:30-3-3(d); (2) tortious interference with business relations; (3) breach of two separate contracts; (4) unjust enrichment; (5) conversion; (6) fraud and/or intentional or negligent misrepresentations; (7) promissory estoppel; and (8) violation of the Fair Labor Standards Act (“FLSA”) because Defendants failed to pay minimum wage or overtime compensation as required by federal law. As noted, Defendants seek judgment on the pleadings.

         “A motion for judgment on the pleadings under Rule 12(c) is treated as a motion to dismiss under Rule 12(b)(6).” Atl. Richfield Co. v. Farm Credit Bank of Wichita, 226 F.3d 1138, 1160 (10th Cir. 2000). And in deciding a motion to dismiss under Rule 12(b)(6) for failure to state a claim, the Court considers whether, per the pleading requirements of Rule 8(a)(2), the complaint contains a “short and plain statement of the claim showing that the pleader is entitled to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009). “The court's function on a Rule 12(b)(6) motion is not to weigh potential evidence that the parties might present at trial, but to assess whether the plaintiff's complaint alone is legally sufficient to state a claim for which relief may be granted.” Sutton v. Utah State Sch. for Deaf & Blind, 173 F.3d 1226, 1236 (10th Cir. 1999) (internal quotation omitted). Further, the Court “must accept all the well-pleaded allegations of the complaint ... and must construe them in the light most favorable to the [non-moving party].” Thomas v. Kaven, 765 F.3d 1183, 1190 (10th Cir. 2014).

         Defendants contend the Court should grant judgment on Count I of the Complaint because the Oklahoma Minimum Wage Act does not apply to Defendants, who concede they are covered by the FLSA. The pertinent statutory language provides:

This act shall not apply to employers subject to the Fair Labor Standards Act of 1938, as amended, and who are paying the minimum wage under the provisions of said act, nor to employers whose employees are exempt under paragraph (e) of this section.

Okla. Stat. tit. 40 § 197.4(d)(footnote omitted). As indicated by the language of the statute, the question is two-fold, whether Defendants are subject to the FLSA and if so, whether it was paying minimum wage.

         Although Defendants concede they are covered by the FLSA, they make no such concession with regard to Mr. Bradshaw or other Uber drivers as their employees. Additionally, Plaintiff is entitled to rely on “[a]lternative theories of relief” at the pleading stage of litigation. Kaiser v. Bowlen, 181 F.Supp.2d 1200, 1203 (D. Colo. 2002). Courtright v. Bd. of County Comm'rs, 2008 WL 2446138 (W.D.Oka. June 13, 2008), upon which Defendants rely, does not support their contention that regardless of whether a Plaintiff has pled a minimum wage claim that coverage by the FLSA precludes a claim under the Oklahoma statute. Courtright was not, as Defendants argue, factually indistinguishable from this case, because it was an overtime case, and Oklahoma law does not mandate overtime pay rates, unlike the FLSA. Id. at 3 (“Plaintiff does not allege that his mandatory work requirements resulted in his being paid less than the minimum wage.”). Accordingly, because Plaintiff is entitled to rely on alternative pleading, the relevant issue is whether he has sufficiently pled a claim for violation of minimum wage under either Oklahoma law or the FLSA, which will be addressed subsequently herein.

         Defendants next contend judgment in their favor is appropriate on Plaintiff's claim that they failed to maintain payroll records because § 380:30-3-3(d) of the Oklahoma Administrative Code, which sets forth the requirement, does not authorize a private right of action. Neither the Oklahoma Minimum Wage Act nor the relevant regulations contain a provision conferring upon an employee the right to sue an employer to enforce a payroll records obligation, nor is there any provision in Oklahoma law permitting an award of damages in the event proper records are not maintained. Plaintiff contends, however, that there exists an implied cause of action. The Court disagrees.

         In Holbert v. Echeverria, 744 P.2d 960 (Okla. 1987), superseded on other grounds by statute, the Court provided a three-part test to determine whether a statute implies a private right of action:

(1) the plaintiff is one of the class for whose especial benefit the statute was enacted; (2) some indication of legislative intent, explicit or implicit, suggests that [the legislature] wanted to create a private remedy and not to deny one; [and] (3) implying a remedy for the plaintiff would be consistent with the underlying purpose of the legislative scheme.

Id. at 963 (citing Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975)). Although Plaintiff may well be within the class of people for whose benefit the regulation was enacted, there is simply no indicia of legislative intent to use the regulation to create a private remedy with regard to an employer's duty to maintain records, nor any indication of an appropriate remedy for such violation. The Court concludes, consistent with Defendants' contention, that there is no private remedy for violation of § 380:30-3-3(d), and accordingly, Defendants are entitled to judgment on this portion of Count I.

         In Count II Plaintiff alleges a claim for tortious interference with business relations by Uber. “Uber interfered with the continuing business relationship between drivers and fares─a separate relationship from that between either Uber and its Drivers or Uber and its riders, and one to which Uber is not a party─whereby riders would have paid gratuity to Drivers, including Plaintiffs, absent Uber's interference.” Complaint ¶ 73. “Were it not for Uber's misrepresentations regarding gratuities, riders would have left a tip for drivers as is customary in the car-service industry. Uber knew that it would be a benefit accruing to the Drivers at the time it discouraged tipping by telling passengers tipping is included in the fare and knew that interference was certain or substantially certain to occur as a result of its conduct.” Complaint ¶¶ 82-83.

In order to recover for tortious interference with business relations, [a plaintiff] must show: (1) it has a business or contractual right that was interfered with; (2) the interference was malicious and wrongful, and neither justified, privileged nor excusable; and (3) damage was proximately sustained as a result of the interference. Mac Adjustment, Inc. v. Prop. Loss Research Bureau, 595 P.2d 427, 428 (Okla. 1979).

Integrated Bus. Techs., LLC v. Netlink Sols., LLC, No. 16-CV-048-TCK-PJC, 2016 WL 4742306, at *5 (N.D. Okla. Sept. 12, 2016). Although Defendants contend Plaintiff is required to identify specific third parties' whose relationships with Defendants were subject to interference, the Court disagrees. Plaintiff alleges Defendants informed Uber riders via advertisements and Uber's website that no gratuity was expected. The reasonable inferences of the Complaint are that all of the riders who rode with Plaintiff were informed of and abided by the “no tip needed” statements Defendants allegedly made. The Court finds, however, that Plaintiff has failed to allege any facts to establish a business or contractual right vis-à-vis the riders with which Defendants interfered. There are no allegations of a contractual or business right to a gratuity as required to support the claim for tortious interference with business relations. As such, the Court finds that Plaintiff has failed to state a claim for tortious interference with a contract or business relationship, and Defendants are entitled to judgment on the pleadings with regard to Count II.[1]

         In Count III Plaintiff alleges that Uber has an implied-in-fact contract with him, as a driver, requiring that it remit all gratuities as well as to reimburse him for expenses. Complaint ¶ 86. Plaintiff further asserts that Uber drivers are third-party beneficiaries of the implied contract between Uber and its riders related to gratuity. Plaintiff contends that the implied contract between Uber and Uber riders requires Uber to remit tips to the drivers. Plaintiff contends “the terms of [the implied contract] were incorporated by reference from certain advertisements or statements Uber made on various webpages.” Id. at ¶ 87. Defendants seek dismissal of each claim for breach of implied contract, asserting that the Complaint fails to allege sufficient facts, in part because there is an express contract between drivers and Uber, thereby precluding creation of an implied-in-fact contract.[2]

A contract is an agreement to do or not to do a certain thing. Okla. Stat. tit. 15, § 1. It is essential to the existence of a contract that there should be: (1) parties capable of contracting; (2) their consent; (3) a lawful object; and (4) sufficient cause or consideration. Okla. Stat. tit. 15, § 2. A contract's terms must be reasonably certain as to establish an enforceable contract. Heldenbrand v. Stevenson, 249 F.2d 424, 427 (10th Cir.1957). Title 15 also provides that a contract is either expressed or implied. Okla. Stat. tit. 15, § 133 The existence and terms of an implied contract are manifested by conduct. Wattie Wolfe Co. v. Superior Contractors, Inc. 417 P.2d 302, 308 (Okla.1966).The implied in fact doctrine applies only when there is no tangible evidence from which to determine whether in fact an agreement exists. Watkins v. Watkins, 177 P.3d 1114, 1118 (Okla.2007). The Court in such situations is compelled to resort to the conduct of the parties. Contracts implied in fact arise where the intent of the parties is not expressed. Ray F. Fischer Co. v. Loeffler-Green Supply Co., 289 P.2d 139 (Okla.1955). However, an express or written contract excludes the possibility of an implied contract of a different or contradictory nature. Fox v. Cities Serv. Oil Co., 201 Okla. 17, 200 P.2d 398, 400 (1948).

Advance Food Co. v. Nebraska Beef, Ltd., No. CIV-08-1139-M, 2009 WL 3698472, at *2 (W.D. Okla. Nov. ...


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