Uber’s ‘$1 settlement’ fails to win over judge

Bloomberg

Uber Technologies Inc. failed to persuade a judge to approve a settlement offering 1.6 million California drivers an average of $1.08 each to dispense with alleged labor-code violations that their lawyer earlier claimed might have been worth billions of dollars.
Los Angeles Superior Court Judge Maren Nelson issued a tentative ruling rejecting a deal aimed at resolving one of the dozen-plus US lawsuits challenging the company’s contractor-based business model.
The judge said there’s merit to objections that the $7.75 million accord — most of which would go to state coffers, administrative costs and lawyer fees — shortchanges drivers who sued seeking the protections and benefits of employees. Nelson also said the settlement provides too broad a release of liability for Uber from labor-code claims. “I need some analysis why it is fair and adequate,” she said during a hearing.
While the judge left open the possibility she’ll approve the settlement once more information is submitted, her ruling marks another setback for Uber in its effort to dispose of a potent legal threat to its business model. Uber still faces a class-action case by California drivers in San Francisco after a federal judge in August rejected a $100 million settlement as inadequate. A critical appeals court hearing over the size and scope of that case is scheduled for June.

TENSE ARGUMENT
It’s already been a tough year for the San Francisco-based startup, valued at $69 billion. Uber is facing calls from customers to #DeleteUber, reports of a toxic cor-
porate culture, harassment allegations, criticism from investors over the company’s response and the abrupt departure of a new senior executive over an undisclosed harassment claim from his previous job at Google.
The company is also contending with Alphabet Inc.’s high-profile lawsuit accusing it of copying technology for self-driving cars. Uber’s chief executive officer said this month he’s seeking “leadership help” in the form of a chief opera-ting officer after his verbal altercation with a driver was caught on video.
Uber said it’s confident the Los Angeles settlement will be approved. The Los Angeles case was brought under a California law that gives employees the right to step into the shoes of the state labor secretary to bring enforcement actions. Under the 2004 Private Attorneys General Act, or PAGA, the state keeps 75 percent of any penalties won. The remaining 25 percent is a reward for the workers who bring the case.