According to Uber, everyone (including passengers) is required to wear a mask while using Uber. However, in this week’s roundup, that might not be the case for one driver in Maine who says he refused passengers without masks – and was fired for it. That, plus all the latest rideshare and delivery news from senior RSG contributor John Ince below.
Uber, hungry for a deal, now reportedly in talks to acquire Postmates [CNN]
Sum and Substance: Uber (UBER) is now reportedly in talks to buy Postmates, a nine-year-old delivery startup, for about $2.6 billion, according to the The New York Times and the Wall Street Journal, citing sources familiar with the matter. A deal could be announced in a matter of days, or could fall through, the outlets reported….
Uber’s attempts to pursue big, pricey acquisitions in the food delivery market highlight a fundamental shift for the company. Uber, which started as a ride-hailing service, has long dabbled in other categories, including meal deliveries with its Uber Eats service. But those efforts have arguably taken on new urgency as the pandemic has simultaneously cut demand for its core rides business while leading to skyrocketing demand for meal deliveries….
“At a time when our Rides business is down significantly due to shelter-in-place, our Eats business is surging,” Uber CEO Dara Khosrowshahi said on the company’s first quarter earnings call in early May. Khosrowshahi said the company’s rides business was down about 80% in the month of April.
My Take: Uber is on the prowl again. The target this time is a smaller company, but it would increase Uber’s market share in the food delivery business. Let’s see where this goes. Give Uber credit. They’re trying.
Uber Bus Just Around the Corner on Post-Pandemic Public Transit Map [NY Times]
Sum and Substance: WARWICK, Rhode Island — Urban transportation’s transformation has shifted up a gear as the coronavirus crisis turns travel habits on their head, with Uber making allies of public transit systems by now offering to sell them its software expertise.
This means Marin County’s Transportation Authority will next month allow passengers in the San Francisco Bay area to book a trip through the Uber app, but rather than someone’s private car they will ride wheelchair-accessible public vans.
My Take: On the surface this makes sense. They’ve been working on the software and “Hey, why not sell it to transit agencies?” But look at the budgets of transit agencies. They’re small, and I wouldn’t expect big increases. So I don’t see this as Uber’s savior.
Kevin Durant Could Score A $15 Million Payday If Uber Buys Postmates [Forbes]
Sum and Substance: The New York Times NYT reported Monday night that Uber Technologies was in talks to buy food-delivery business Postmates for roughly $2.6 billion, after earlier reports Monday that the company was reviving IPO plans. It would be a huge win for Durant, who invested roughly $1 million in the startup in 2016 at a discounted entry price. The current value of his stake is up an estimated 15-fold, based on the Uber valuation, to $15 million.
Durant’s company, Thirty Five Ventures, co-founded with his business manager Rich Kleiman, has 15 full-time employees focused on Durant’s endorsements, startup investments, foundation and media properties. He’s invested more than $15 million into 40-plus startups. “I want to use the checks I get from companies to create true generational wealth,” Durant said for a Forbes cover story six months ago. Durant said his gains on paper had topped 400% as of late 2019.
My Take: $15 million is a pretty nice chunk of change. The article is about Durant’s larger ambitions, but this looks pretty sweet for the former-Warriors great.
Supreme Court of Canada Invalidates Uber Arbitration Clause in $400-Million Class Action [Lexology]
Sum and Substance: On June 26, 2020, the Supreme Court of Canada released its decision in the highly publicized case of Heller v Uber Technologies Inc. The case arises from a Toronto-based UberEATS driver’s effort to bring a $400-million class action against Uber, on behalf of Uber and UberEATS drivers in Ontario. Mr. Heller alleged that Uber violated the Employment Standards Act, 2000 by treating Uber and UberEATS drivers as independent contractors and failing to provide them with employment-related entitlements like minimum wage, vacation, and overtime pay.
The issue before the Court was the validity of an arbitration clause in a standard form service agreement. The agreement was governed by the law of the Netherlands and required drivers to litigate their disputes with Uber in the Netherlands. Uber required all of its prospective drivers to enter into this agreement by having them accept the terms through their app. The Court ruled in favor of the drivers, finding that the arbitration clause was unconscionable because its terms effectively made it effectively impossible for the drivers to arbitrate their claims. As a result of the decision, the class action can proceed to a certification motion. …
My Take: This makes sense to me. How much sense does it make for drivers to sign away their rights when they check that box? Not much. But they can’t drive if they don’t check it. Definitely not parties of equal bargaining power.
Uber driver says company fired him after he refused rides for unmasked passengers [ActionNewsJax]
Sum and Substance: Danny Darling, a now-former Uber driver, says he was wrongfully fired after refusing rides to people who were not wearing masks.
Originally Darling said he would ask potential ride-share passengers to wear one, but most of the time the request was met with arguments, even violence with some passengers kicking his car, even going as far as spitting on him, he told WCSH.
To avoid the outbursts, he said if his passenger wasn’t masked when he arrived, he’d cancel the trip, posting “not wearing a mask” as the reason.
From June 1 Uber allowed the practice and set the rule that riders must wear a facial covering, but many didn’t, Darling told WCSH. …
The company told WCSH that this termination was based on reports before and leading up to March and had nothing to do with his cancelation of trips because riders were not masked.
Darling has filed an appeal with Uber and a complaint with Maine’s governor’s office. Uber is investigating the termination, company officials told WCSH.
My Take: Without a dash camera (recording the inside and outside of the car), we’ll never know exactly what happened here. Only the company knows why they fired him, but it makes a good story. And who knows, maybe he’ll get a reversal.
Uber and Lyft say regulator can’t make drivers employees [SF Chronicle]
Sum and Substance: The San Francisco ride-hailing companies, along with two smaller ride services for children called HopSkipDrive and Zum, on Tuesday filed papers challenging the authority of the California Public Utilities Commission to determine that their drivers are employees.
At issue is a June 9 “scoping memo” from agency Commissioner Genevieve Shiroma that said “for now, TNC drivers are presumed to be employees,” … A scoping memo is a mechanism to identify future issues rather than a formal decision. …
The scoping memo and a June 2 letter from a director at the commission said the ride services must provide workers’ compensation for their drivers under AB5, which set a July 1 deadline for that insurance coverage. …
My Take: So it goes: Uber and Lyft Lyft fiercely contend their drivers are not employees and says the PUC isn’t the right body to make the decision. Looks like it’s coming down to the ballot initiative next fall.
Readers, what do you think of this week’s roundup?
-John @ RSG