The suit is against the company’s CEO Travis Kalanick. It alleges that the company prime business motive is to make a cut by fixing prices among competitors.
A U.S court has ruled that car hailing company, Uber must submit documents to a court in New York where a judge is investigating whether the private investigators hired by the company had fraudulently sought information regarding its rivals in an antitrust case.
U.S. District Judge Jed Rakoff, is trying to determine whether Uber had instructed its investigators to lie so as to elicit information on Spencer Meyer and his lawyer.
According to the class action lawsuit Travis Kalanick, Uber’s CEO, had engaged in a price-fixing scheme with Uber drivers. The lawsuit has not named Uber but has instead named Kalanick. Uber is trying to intervene in the lawsuit.
According to Rakoff, in one particular instance, an investigator who was hired by Uber had allegedly called Meyer’s attorney’s professional colleagues and had “falsely stated that he was compiling a profile of up-and-coming labor lawyers in the United States.”
According to court documents, when confronted with the investigator’s calls, Kalanick’s attorneys initially denied that the company was involved with them, only later they finally owned up to the fact that they had in fact hired investigators from Ergo in order to dig up information about Meyer.
Despite the flip flops, Uber has denied in a court filing that it knew that the investigator had lied or had concealed his identity.
According to the lawsuit, “Uber has a simple but illegal business plan: to fix prices among competitors and take a cut of the profits.” It alleges that drivers had conspired with Kalanick to charge fares as determined by Uber’s algorithm, with an understanding that other drivers too will tow this line.
While delivering his order, Rakoff made it clear that he wanted evidence to show that Uber’s assertions were true – that it did not know about the misrepresentations.
“An Ergo investigator hired by Uber in connection with this case made false representations in order to gain access to information about plaintiff and his counsel, thus raising a serious risk of perverting the process of justice before this Court,” wrote Rakoff in his order.
In the order, the judge has also agreed to the plaintiff’s request and has authorised a probe. Uber will now have to hand over documents and communications pertaining to the investigative work performed by Ergo for review by the court.
Although Uber has argued against proving the said documents saying they were privileged, the notion was rejected by the court.
“The Court finds that plaintiff has provided an entirely ‘reasonable basis’ to suspect the perpetration of a fraud and to suspect that Uber communications furthered such a fraud,” wrote Rakoff.
Earlier this year, Kalanick’s attorneys had tried to dismiss the case saying according to the specific language used in the term of the agreement, passengers waive the right to bring class-action suits against the company.
Rakoff had denied this motion in March.
The case in U.S. District Court, Southern District of New York, is Spencer Meyer vs. Travis Kalanick, 15-09796.
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