Appeals Court Upholds Dismissal of Racial Bias Lawsuit Against Uber

Uber Technologies, Inc.

A U.S. appeals court on Monday dismissed a lawsuit claiming that Uber (NYSE:UBER) discriminates against drivers based on race by terminating those with low passenger ratings.

The 9th U.S. Circuit Court of Appeals in San Francisco ruled that Thomas Liu, who filed the suit in 2020, failed to present evidence demonstrating that Uber deactivated non-white drivers at a higher rate than white drivers with low ratings. Liu’s lawyers argued that statistical proof would emerge during the discovery phase, allowing them to request documents and testimonies from Uber. However, the three-judge panel stated that Liu’s claim was based on speculation without sufficient evidence of discrimination.

Uber has not commented on the court’s decision.

Shannon Liss-Riordan, Liu’s lawyer, expressed disappointment and concern about the ruling and hinted at a potential request for the court to reconsider.

Uber’s rating system requires passengers to rate drivers on a scale from one to five. Drivers who fail to maintain a rating above 4.6 are deactivated. Liu, who is Asian-American, argued that passengers tend to give lower ratings to non-white drivers, making Uber’s system a violation of Title VII of the Civil Rights Act of 1964 and California’s anti-discrimination laws.

In 2022, U.S. District Judge Vince Chhabria dismissed the case, stating that there was no credible statistical evidence demonstrating racial disparity among Uber drivers. He also criticized a survey conducted by Liu’s lawyers, deeming it flawed and not accurately reflecting the racial makeup of Uber drivers.

The 9th Circuit upheld this decision on Monday, agreeing that the survey had significant flaws and did not provide a comprehensive understanding of the racial demographics of Uber drivers.

The U.S. Equal Employment Opportunity Commission, responsible for enforcing Title VII, supported Liu. The agency argued that research suggests customer ratings are often influenced by bias, affecting Uber drivers and other gig workers. Combined with the survey, the commission believed Liu had established a plausible case.