Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 1 of 9
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`Karen L. Dunn (pro hac vice forthcoming)
`kdunn@paulweiss.com
`William A. Isaacson (pro hac vice forthcoming)
`wisaacson@paulweiss.com
`Kyle N. Smith (pro hac vice forthcoming)
`ksmith@paulweiss.com
`Erica Spevack (pro hac vice forthcoming)
`espevack@paulweiss.com
`PAUL, WEISS, RIFKIND, WHARTON &
`GARRISON LLP
`2001 K Street, NW
`Washington, DC 20006
`Telephone: (202) 223-7300
`
`Joshua Hill Jr. (SBN 250842)
`jhill@paulweiss.com
`PAUL, WEISS, RIFKIND, WHARTON &
`GARRISON LLP
`535 Mission Street, 24th Floor
`San Francisco, CA 94105
`Telephone: (628) 432-5100
`
`Attorneys for Defendant
`UBER TECHNOLOGIES, INC.
`
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`
`
`TAJE GILL, ESTERPHANIE ST. JUSTE, and
`BENJAMIN VALDEZ, individually and on
`behalf of all others similarly situated,
`
`Plaintiffs,
`
`v.
`
`UBER TECHNOLOGIES, INC., a Delaware
`corporation, and LYFT, INC., a Delaware
`corporation,
`
`
`
`
`Defendants.
`
`Case No. ________________
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`
`DEFENDANT UBER
`TECHNOLOGIES, INC.’S NOTICE
`OF REMOVAL
`Notice of Removal Filed: July 28, 2022
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`NOTICE OF REMOVAL
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`Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 2 of 9
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`NOTICE OF REMOVAL
`PLEASE TAKE NOTICE THAT, Defendant Uber Technologies, Inc. (“Uber”), by and
`through its counsel, hereby gives notice of the removal of this action, from the Superior Court of
`the State of California, San Francisco County to the United States District Court for the Northern
`District of California, pursuant to 28 U.S.C. §§ 1331, 1441, and 1446, based on the following facts.
`TIMELINESS OF REMOVAL
`1.
`Plaintiffs Taje Gill, Esterphanie St. Juste, and Benjamin Valdez (together,
`“Plaintiffs”) filed this putative class action in the Superior Court of the State of California, San
`Francisco County on June 21, 2022. Ex. A (“Complaint” or “Compl.”). Uber was served on July
`12, 2022, Ex. F, and Uber has filed this Notice of Removal within 30 days of service of Plaintiffs’
`Complaint, which was the first pleading received by Uber, through service or otherwise, setting
`forth the claim for relief upon which this action is based.
`2.
`This Notice of Removal is therefore timely under 28 U.S.C. § 1446(b) because it is
`being filed within 30 days of service.
`NATURE OF THE ACTION
`3.
`Defendant Uber is a technology company that has a mobile application (the “Uber
`app”) that matches independent transportation providers with individuals looking for rides.
`4.
`Defendant Lyft, Inc. (“Lyft”) is a technology company that has a mobile application
`(the “Lyft app”) that matches independent transportation providers with individuals looking for
`rides.
`
`5.
`Plaintiff Taje Gill alleges he started providing transportation services using the Uber
`app in August 2017 and started providing transportation services using the Lyft app in September
`2017, primarily in Orange County, California. Compl. ¶ 118.
`6.
`Plaintiff Esterphanie St. Juste alleges she started providing transportation services
`using the Uber app in the Los Angeles, California area in June 2015 and started providing
`transportation services using the Lyft app in July 2015. Id. ¶ 128.
`7.
`Plaintiff Benjamin Valdez alleges he started providing transportation services using
`the Uber and Lyft apps in the Los Angeles, California area in 2015. Id. ¶ 138.
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`NOTICE OF REMOVAL
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`Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 3 of 9
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`8.
`Plaintiffs allege that Uber and Lyft have “sufficient market power for their conduct
`to harm competition,” id. ¶ 104, and that Uber and Lyft use that power to engage in
`“anticompetitive” conduct that “suppresses competition,” id. ¶¶ 156, 162-64, 175, 181. For
`example, Plaintiffs allege that “Uber has engaged in aggressive efforts to foreclose competition,”
`id. ¶ 114, and that Uber and Lyft impose terms on drivers that “have substantially adverse effects
`on competition,” including because they “prevent drivers from multi-homing,” which “restrains
`competition and restricts drivers’ ability to offer better terms to riders by switching apps, resulting
`in lower wages for drivers and higher fares for passengers.” Id. ¶ 116. Plaintiffs further allege that
`these alleged “anticompetitive effects are not offset by any procompetitive benefits.” Id. ¶ 117; see
`also id. ¶¶ 104-17.
`9.
`Plaintiffs purport to bring this action individually and on behalf of “[a]ll individuals
`domiciled in California who have driven for Lyft and/or Uber in California within the four years
`prior to the filing of this Complaint and who have opted out of Lyft and/or Uber’s arbitration
`agreements.” Id. ¶ 146.
`10.
`Plaintiffs seek, among other things, an injunction against Uber’s allegedly wrongful
`conduct, and monetary relief, including restitution and damages, including treble damages and
`punitive damages. Id. at Prayer for Relief ¶ b.
`11.
`Uber and Lyft are the only defendants named in the Complaint, and each consents
`to this Notice of Removal.1
`
`GROUNDS FOR REMOVAL
`12.
`Plaintiffs allege six causes of action. If any one of these causes of action turns on a
`substantial federal question, the action is removable. Cnty. of Santa Clara v. Astra USA, Inc., 401
`F. Supp. 2d 1022, 1025 (N.D. Cal. 2005) (“If only one of several state claims satisfies the
`requirements for removal on federal-question grounds, then any other purely state claims in the
`same complaint may also be determined by the federal court under its supplemental jurisdiction.”).
`
`1 Defendant Lyft has consented to the filing of this Notice of Removal. See Proctor v. Vishay
`Intertechnology Inc., 584 F.3d 1208, 1225 (9th Cir. 2009) (“One defendant’s timely removal notice
`containing an averment of the other defendants’ consent and signed by an attorney of record is
`sufficient” for joinder requirement in filing a notice of removal).
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`NOTICE OF REMOVAL
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`13.
`Even though Plaintiffs label their causes of action as state law claims, the gravamen
`of their Complaint alleges unilateral conduct in abuse of alleged market power. The California
`antitrust law under which Plaintiffs purport to bring their claims, the Cartwright Act, does not apply
`to unilateral conduct. Dimidowich v. Bell & Howell, 803 F.2d 1473, 1478 (9th Cir. 1986), opinion
`modified on denial of reh’g, 810 F.2d 1517 (9th Cir. 1987) (claims challenging “only unilateral
`conduct” are “not cognizable under the Cartwright Act”). Plaintiffs’ claims—including their claims
`under California’s Unfair Competition Law (“UCL”)—are therefore necessarily federal in
`character because “[n]o California statute deals expressly with monopolization or attempted
`monopolization” and, as a consequence, such claims arise only under the Sherman Act. Rosenman
`v. Facebook Inc., 2021 WL 3829549, at *4 (N.D. Cal. Aug. 27, 2021) (quoting Dimidowich, 803
`F.2d at 1478). Plaintiffs’ right to relief thus depends upon the resolution of substantial, disputed
`questions of federal antitrust law. California district courts have repeatedly upheld removal on this
`basis. See, e.g., id. (denying motion to remand because “where a plaintiff’s UCL unfair prong claim
`relies on a defendant’s alleged abuse of its monopoly position, that claim requires establishing a
`violation of federal antitrust law”); In re: Nat’l Football League’s Sunday Ticket Antitrust Litig.
`(NFL Sunday Ticket), 2016 WL 1192642, at *6 (C.D. Cal. Mar. 28, 2016) (denying motion to
`remand because a “federal issue—namely, a federal antitrust issue under Section 2 of the Sherman
`Act—is necessarily raised in Plaintiff’s artfully pleaded Complaint,” which purported to allege only
`claims under state law); Nat’l Credit Reporting Ass’n, Inc. v. Experian Info. Solutions, Inc., 2004
`WL 1888769, at *3 (N.D. Cal. July 21, 2004) (denying motion to remand where “gravamen of
`plaintiff’s complaint was that each defendant had unilaterally engaged in anticompetitive conduct,”
`requiring resolution of substantial questions of federal law because “California’s antitrust laws do
`not address such unilateral, monopolization conduct”).
`14.
`The “artful pleading” doctrine prevents a plaintiff from “avoid[ing] federal
`jurisdiction by omitting from the complaint allegations of federal law that are essential to the
`establishment of his claim.” Lippitt v. Raymond James Fin. Servs., Inc., 340 F.3d 1033, 1041 (9th
`Cir. 2003). Under this doctrine, if “a plaintiff chooses to plead what ‘must be regarded as a federal
`claim,’ then ‘removal is at the defendant’s option.’” Sparta Surgical Corp. v. Nat’l Ass’n of Sec.
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`Dealers, Inc., 159 F.3d 1209, 1213 (9th Cir. 1998), abrogated on other grounds. Specifically,
`removal is proper if the “right to relief depends on the resolution of a substantial, disputed federal
`question.” ARCO Env’t Remediation, L.L.C. v. Dep’t of Health & Env’t Quality of Mont., 213 F.
`3d 1108, 1114 (9th Cir. 2000). Masquerading a federal claim as a state law claim does not save it
`from removal. Nat’l Credit Reporting, 2004 WL 1888769, at *2 (even where a complaint asserts
`only one state law cause of action, it “may still be removed under the artful pleading doctrine if it
`is predicated on a violation of federal antitrust laws”).
`15.
`Here, Plaintiffs premise their claims on allegations of each of Uber’s and Lyft’s
`unilateral conduct, which Plaintiffs characterize as an abuse of “market power.” E.g., Compl.
`¶¶ 11, 39, 104-17. California’s antitrust laws do not cover unilateral conduct. Dimidowich, 803
`F.2d at 1478 (claims challenging “only unilateral conduct” are “not cognizable under the Cartwright
`Act”); Free Freehand Corp. v. Adobe Sys. Inc., 852 F. Supp. 2d 1171, 1185-86 (N.D. Cal. 2012)
`(holding that the Cartwright Act does not address unilateral conduct); Davis v. Pac. Bell, 2002 WL
`35451316, at *2 (N.D. Cal. Oct. 2, 2002) (“By its terms, the Cartwright Act does not apply to
`unilateral conduct.”).
`16.
`Plaintiffs’ Complaint here brings claims arising from alleged unilateral
`anticompetitive conduct based on allegations of dominance and/or market power. The Ninth
`Circuit has explained that a “plaintiff may not avoid federal jurisdiction by omitting from the
`complaint federal law essential to his or her claim or by casting in state law terms a claim that can
`be made only under federal law.” Sparta, 159 F.3d at 1212-13. Thus, if the Court concludes that
`Plaintiff “has ‘artfully pleaded’ claims in this fashion, it may uphold removal even though no
`federal question appears on the face of the plaintiff’s complaint.” NFL Sunday Ticket, 2016 WL
`1192642, at *3 (citing Rivet v. Regions Bank of La., 522 U.S. 470, 475 (1998)).
`17.
`The following is a sampling of the Plaintiffs’ allegations that reflect the unilateral—
`and thus federal—character of their claims:
`a.
`“Uber and Lyft each adopt non-price restraints that are designed to limit
`competition” (Compl. ¶ 5);
`“Uber and Lyft have each adopted vertical restraints that constrain the
`
`b.
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`Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 6 of 9
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`c.
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`economic independence of their drivers” (Compl. ¶ 12);
`“Uber and Lyft have the market power to implement market-wide price
`increases without fear that consumers or drivers would flock to a competitor”
`(Compl. ¶ 39);
`Uber and Lyft operate “compensation schemes” that “can be described as
`‘exclusive commitment incentives’ because they provide drivers with
`incentive payments that cannot be accessed unless they effectively commit
`to working exclusively for the app offering the incentives, no matter how
`unfavorable the terms of the rides may be” (Compl. ¶ 63);
`“Both apps’ information-sharing policies inhibit multi-homing and reduce
`drivers’ ability to shop between apps” (Compl. ¶ 92);
`“Several ventures have attempted to compete against Defendants in
`California, notably Sidecar. As a consequence of the challenged conduct as
`well as predatory pricing and tortious interference by the incumbents, none
`of those efforts has succeeded” (Compl. ¶ 103);
`“Here, there is abundant direct evidence of market power. Uber and Lyft
`have both repeatedly decreased the pay provided to drivers, and increased
`the fare charged to passengers, without a significant impact to their
`respective market shares” (Compl. ¶ 106);
`“Serial price increases for rides and reductions to driver compensation by
`Uber and Lyft without loss of market share establish that they each enjoy the
`power to price above marginal cost, and to reduce driver pay below marginal
`product [sic]” (Compl. ¶ 107);
`“Similarly, the limitations on driver mobility and ability to switch from
`platform-to-platform because of the price and non-price vertical restraints
`described above are also direct evidence of market power” (Compl. ¶ 108);
`“Uber has engaged in aggressive efforts to foreclose competition” (Compl.
`¶ 114);
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`Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 7 of 9
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`k.
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`l.
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`“Defendants possess market power, as evidenced by: a. Their ability to
`impose disadvantageous terms on drivers . . . b. Their ability to significantly
`decrease the compensation paid to drivers without a significant number of
`drivers switching to a different app or exiting the market entirely. c. Their
`high market shares and overall duopolistic market structure. d. The
`imposition of disadvantageous contractual terms without compensation”
`(Compl. ¶ 115);
`“Defendants’ non-price vertical restraints have substantially adverse effects
`on competition, too. By tethering drivers to a specific app, these restraints
`prevent drivers from multi-homing, despite Defendants’ claims that there are
`no restrictions on drivers’ ability to move between apps. This in turn
`restrains competition and restricts drivers’ ability to offer better terms to
`riders by switching apps, resulting in lower wages for drivers and higher
`fares for passengers” (Compl. ¶ 116).
`18.
`Plaintiffs then summarize their causes of action as turning on allegations of
`unilateral abuse of market power. See, e.g., Compl. ¶ 161 (alleging “Uber and Lyft have created
`and carried out restrictions in trade or commerce such as the non-price vertical restraints described
`in this Complaint”); id. ¶ 175 (alleging Uber’s and Lyft’s “unlawful” conduct involves “suppressing
`competition from other rideshare companies” and “undermin[ing] drivers’ ability to participate in
`free and independent businesses”); id. ¶¶ 181, 183 (alleging Uber’s and Lyft’s “unfair” conduct
`involves “suppress[ing] competition from other rideshare companies and undermin[ing] drivers’
`autonomy” to “cause substantial injury . . . which is not outweighed by any countervailing
`benefits”).
`
`COMPLIANCE WITH OTHER REMOVAL REQUIREMENTS
`19.
`Based on the foregoing, this Court has original jurisdiction of this action under 28
`U.S.C. §§ 1331, 1441, and 1446.
`20.
`The United States District Court for the Northern District of California is the
`appropriate venue for removal under 28 U.S.C. § 1441(a) because it is the federal jurisdiction
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`Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 8 of 9
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`encompassing the Superior Court of the State of California, San Francisco County, where this suit
`was originally filed.
`21.
`Copies of all process, pleadings, and orders from the state-court action being
`removed to this Court that Uber has obtained from the Superior Court of the State of California,
`San Francisco County, and which are in the possession of Uber are attached hereto as Exhibits A-
`F. Pursuant to 28 U.S.C. § 1446(a), this constitutes “a copy of all process, pleadings, and orders”
`received by Uber in the action.
`22.
`Pursuant to 28 U.S.C. § 1446(d), Uber will promptly file a copy of this Notice of
`Removal, as well as a Notice of Filing of this Notice of Removal, with the Clerk of the Superior
`Court of the State of California, San Francisco County, and serve a copy of the same on Plaintiffs.
`A copy of this filing (without exhibits) is attached as Ex. G.
`23.
`This Notice of Removal is signed pursuant to Fed. R. Civ. P. 11, as required by 28
`U.S.C. § 1446(a).
`24.
`Uber reserves the right to amend or supplement this Notice of Removal. Uber also
`reserves all rights, defenses, and objections available under applicable law, including without
`limitation its right to enforce agreements to arbitrate or any challenges to personal jurisdiction,
`insufficient process, and/or insufficient service of process, and the filing of this Notice of Removal
`is subject to, and without waiver of, any such defenses or objections.
`WHEREFORE, Uber respectfully gives notice that this action is hereby removed from the
`Superior Court of the State of California, San Francisco County to the United States District Court
`for the Northern District of California.
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`Case 3:22-cv-04379 Document 1 Filed 07/28/22 Page 9 of 9
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`Dated: July 28, 2022
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`PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP
`
`
`
`By: /s/ Joshua Hill
`
`
`
` Karen L. Dunn (pro hac vice forthcoming)
`kdunn@paulweiss.com
`William A. Isaacson (pro hac vice forthcoming)
`wisaacson@paulweiss.com
`Kyle N. Smith (pro hac vice forthcoming)
`ksmith@paulweiss.com
`Erica Spevack (pro hac vice forthcoming)
`espevack@paulweiss.com
`2001 K Street, NW
`Washington, DC 20006
`Telephone: (202) 223-7300
`
`Joshua Hill Jr. (SBN 250842)
`jhill@paulweiss.com
`535 Mission Street, 24th Floor
`San Francisco, CA 94105
`Telephone: (628) 432-5100
`
`
`Attorneys for Defendant
`UBER TECHNOLOGIES, INC.
`
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`
`
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`8
`NOTICE OF REMOVAL
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