Uber Hit with Amended Class Action Over Cancellation Fees

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Uber Technologies faces an amended proposed class action over a consumer’s claim that the ride-hailing company has “mistakenly or misleadingly” represented that it is required to charge customers a $5 cancellation fee in order to pay drivers for their time when a rider cancels a ride.

As the 19-page lawsuit tells it, Uber charges riders a $5 cancellation fee even when it is the driver who cancels a ride, something the plaintiff says occurs regularly. In such instances, the case says, Uber will not refund the cancellation fee to the customer “until and unless the customer asks Uber to review” the charge. And when it does choose to refund a customer’s cancellation fee, Uber will issue not the money the consumer spent in the first place, but “Uber Credit” or “Uber Cash” in the equivalent amount, the lawsuit claims.

The suit charges that Uber Credit and Uber Cash cancellation refunds are “seldom sufficient” to cover most Uber fares. Uber customers, the lawsuit says, are left with the choice of having to buy additional Uber Credit or Cash, usually in $25 increments, effectively trapping the individual “into a scheme of being continually forced to replenish” their Uber-sanctioned credit and cash accounts in order to cover subsequent rides.

Further still, the complaint takes issue with Uber’s apparent practice of holding and detaining customer funds in the “rare instances” when it agrees to refund a cancellation fee in a rider’s preferred payment method. Per the case, such refunds typically take three to five business days to process; during this time, Uber “unlawfully holds and detains the customer’s funds despite the fact that competitors such as Lyft reportedly refund improper charges immediately, the lawsuit says.

All told, the lawsuit alleges Uber’s Terms of Use constitute an “unenforceable contract of adhesion,” as the majority of consumers who download the Uber app “unwittingly agree to waive their right to a trial by jury” and pursue class action litigation no matter the nature of their claim against the company.

Per the plaintiff, the lawsuit describes the individual as a 68-year-old disabled man who initially downloaded the Uber app in search of “an expeditious and inexpensive” ride home after an eight-day hospital stay. The man claims he waited at a pick-up point for more than 20 minutes and contacted his driver numerous times, yet no ride ever showed up. In response, the plaintiff canceled the trip, the lawsuit says, and was charged a $3.50 cancellation fee for doing so.

“In all, Plaintiff was forced to walk six (6) blocks, wasted over twenty-five (25) minutes before connecting with an UBER driver and, adding insult to injury, was unfairly charged a ‘cancellation fee’ to compensate UBER’s rogue driver for his time,” the complaint reads.

Since its filing, the lawsuit has been removed to Florida’s Southern District.