Uber has been ordered to pay $8.5 million following a trial concerning allegations of sexual assault by drivers

A federal jury in Phoenix has directed Uber (UBER.N) to pay $8.5 million following a ruling in a lawsuit filed by a woman who claimed she was sexually assaulted by a driver. This verdict may have implications for numerous similar cases against the ride-hailing company.

The case initiated by plaintiff Jaylynn Dean marked the inaugural trial, referred to as a “bellwether,” among over 3,000 comparable lawsuits against Uber that have been consolidated in U.S. federal court. Bellwether trials serve to evaluate legal theories and assist in assessing the worth of claims for potential settlements.

The jury determined that the driver acted as an agent of Uber, thereby holding the company accountable for his actions. Dean was awarded $8.5 million in compensatory damages, but the request for punitive damages was denied.

Lawyers representing Dean had requested over $140 million in damages.
An Uber spokesperson stated that the jury dismissed Dean’s additional claims regarding the company’s negligence and the alleged defects in its safety systems, and mentioned that the company intends to appeal.

“This verdict confirms that Uber has acted with responsibility and has made significant investments in ensuring rider safety,” the spokesperson stated.

Sarah London, an attorney representing Dean, stated that the verdict “validates the thousands of survivors who have bravely come forward to seek accountability from Uber for prioritizing profit over passenger safety.”

Uber shares declined by 0.5% in after-hours trading after the verdict was announced.

In 2023, Dean, a resident of Oklahoma, filed a lawsuit against Uber, following her reported assault in Arizona just a month prior. She stated that Uber was cognizant of a series of sexual assaults perpetrated by its drivers, yet had not taken fundamental measures to enhance the safety of its passengers. The company has long faced such assertions, attracting headlines and congressional scrutiny.

During the trial’s closing arguments, Alexandra Walsh, an attorney for Dean, stated that Uber had positioned itself as a safe choice for women traveling at night, especially if they had been drinking.

“Women understand that the world can be perilous.” “We are aware of the dangers associated with sexual assault,” Walsh stated. “We were led to think that this was a place free from such dangers.”

UBER DECLARES NO LIABILITY FOR DRIVER BEHAVIOR

Uber has encountered various safety controversies, including claims of inadequate driver vetting and a culture that some critics argue favors growth over passenger safety. The company contends that it should not be held responsible for the criminal actions of drivers using its platform, asserting that its background checks and disclosures regarding assaults are adequate.

The company asserts that its drivers are independent contractors instead of employees, and that it cannot be held accountable for actions that are beyond what could reasonably be deemed their responsibilities, regardless of their classification. “He had no criminal history.” “None,” stated Kim Bueno, an attorney for Uber, during closing arguments regarding the driver, highlighting that he had completed 10,000 trips on the app and maintained a nearly perfect rating from riders. Was this anticipated by Uber? And the response to that must be no.

Dean’s lawsuit stated that she was under the influence when she engaged an Uber driver to transport her from her boyfriend’s residence to her hotel.

According to the lawsuit, Dean alleged that the driver posed harassing questions during the ride before stopping the car and assaulting her.

U.S. District Judge Charles Breyer, typically based in San Francisco, presided over Dean’s case in Phoenix. Breyer is overseeing all of the related federal cases against Uber, which have been consolidated in his court in San Francisco.

The company is currently dealing with over 500 cases in California state court. In the sole instance among those to reach trial thus far, a jury in September ruled in favor of Uber. The jury determined that although the company had been careless with its safety protocols, that carelessness did not significantly contribute to the woman’s injury.

Lyft (LYFT.O), a competitor to Uber, is encountering similar lawsuits in both state and federal courts, though there is no coordinated federal litigation for these claims. Lyft’s shares experienced a decline of 1% following the verdict.