Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 1 of 11 1 2 3 4 5 6 7 8 9 10 Keith A. Custis kcustis@custislawpc.com CUSTIS LAW, P.C. 1875 Century Park East, Suite 700 Los Angeles, California 90067 (213) 863-4276 Ashley Keller (pro hac vice forthcoming) ack@kellerlenkner.com Travis Lenkner (pro hac vice forthcoming) tdl@kellerlenkner.com Tom Kayes (pro hac vice forthcoming) tk@kellerlenkner.com KELLER LENKNER LLC 150 N. Riverside Plaza, Suite 4270 Chicago, Illinois 60606 (312) 741-5220 11 12 13 14 Warren Postman (pro hac vice forthcoming) wdp@kellerlenkner.com KELLER LENKNER LLCP 1300 I Street, N.W., Suite 400E Washington, D.C. 20005 (202) 749-8334 15 16 Attorneys for Plaintiffs UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION 17 18 19 ODEH ABDELJABBAR ET AL., 20 21 Plaintiffs, v. Case No. 3:18-cv-7482 COMPLAINT 27 1. Failure to Pay Minimum Wage and Overtime Under the FLSA 2. Failure to Pay Minimum Wage and Overtime Under the California Labor Code 3. Violation of Local Wage Ordinances 4. Failure to Provide Wage Statements 5. Denial of Access to Employment Records 6. Violation of Unfair Competition Law 28 (Jury Trial Demanded) 22 LYFT INC. 23 24 25 26 Defendant. Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 2 of 11 1 2 INTRODUCTION 1. Plaintiffs work as drivers for Lyft in California. Together with other Lyft drivers, 3 Plaintiffs form the core workforce necessary for Lyft to sell rides—the service that generates Lyft’s 4 revenue. Rather than treat Plaintiffs as employees, Lyft misclassifies Plaintiffs as independent 5 contractors, which means it fails to pay Plaintiffs a minimum wage; fails to pay them overtime; and 6 fails to provide them with various other protections required by federal, state, and local law. 7 2. The difference between what Lyft should pay Plaintiffs and what it does pay 8 Plaintiffs is significant. The minimum wage in California is $11 per hour. The minimum wages in 9 Los Angeles and San Francisco, which apply to the majority of Plaintiffs, are $13.25 and $15.00 10 11 12 13 respectively. But Lyft frequently pays many Plaintiffs less than $8 per hour. 3. Lyft does not pay Plaintiffs any overtime for the considerable time they drive more than 40 hours in a week. 4. Although California law requires employers to provide employees with earnings 14 statements that allow them to assess their net pay and hourly rate, Lyft provides earning statements 15 that omit this information. 16 17 18 5. Likewise, while California law requires employers to allow employees to review their employment records, Lyft has repeatedly refused to allow Plaintiffs to access their records. 6. Plaintiffs now bring this case against Lyft to collect what it owes them under federal, 19 state, and local law, and to obtain an injunction requiring Lyft to treat them as employees going 20 forward. 21 22 23 24 25 PARTIES 7. in Exhibit A. 8. 28 Defendant Lyft, Inc. (“Lyft”) is a Delaware corporation headquartered at 185 Berry Street, Suite 5000, San Francisco, California 94107. 26 27 Plaintiffs are Lyft drivers who drive in California. Details for each Plaintiff are listed JURISDICTION AND VENUE 9. This Court has subject-matter jurisdiction under 28 U.S.C. § 1331 over Plaintiffs’ claims under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §201 et. seq. The Court has -2- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 3 of 11 1 supplemental jurisdiction under 28 U.S.C. § 1367 over Plaintiffs’ claims arising under state and 2 local law because the claims are so related to the FLSA claim that they form part of the same case 3 or controversy. 4 5 6 10. The Court has personal jurisdiction over Lyft because Lyft has its headquarters and principal place of business in California. 11. Venue is proper in this district (San Francisco Division) pursuant to 28 U.S.C. § 7 1391(b)(1) because Defendant is headquartered in San Francisco County, conducts business in San 8 Francisco County and many of the acts and omissions complained of occurred in San Francisco 9 County. 10 11 INTRADISTRICT ASSIGNMENT 12. Pursuant to Civil Local Rules 3-2(c), a substantial part of the events or omissions 12 giving rise to this action occurred in San Francisco County; therefore, it is appropriate to assign to 13 the San Francisco Division. 14 FACTUAL ALLEGATIONS 15 A. LYFT’S BUSINESS 16 13. Lyft was founded by Logan Green and John Zimmer. 17 14. As regularly described by its founders, Lyft was created with the mission of 18 “improv[ing] people’s lives with the world’s best transportation.” 19 15. Effectively all of Lyft’s revenue comes from selling rides. 20 16. Customers order rides from Lyft using a smartphone app. 21 17. When a customer orders a ride, Lyft assigns a nearby driver to pick up the customer 22 23 24 25 and complete the requested trip. 18. Lyft has applied for and received a license in California as a Transportation Network Company (“TNC”). 19. California law defines a TNC as an entity that “that provides prearranged 26 transportation services for compensation using an online-enabled application or platform to connect 27 passengers with drivers using a personal vehicle.” CAL. PUB. UTIL. CODE § 5431. A TNC license is 28 a type of Transportation Charter Party (“TCP”) license, which is available to entities “engaged in -3- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 4 of 11 1 the transportation of persons by motor vehicle for compensation, over any public highway” in 2 California. CAL. PUB. UTIL. CODE § 5360. 3 4 5 6 7 8 9 20. Lyft drivers operating under the TNC license must display Lyft’s “trade dress,” which are the distinctive Lyft decals or lighted signs on the front and rear of the vehicles. 21. Consumers uniformly associate Lyft’s brand with for-hire transportation. In common parlance, the phrase “getting a Lyft” refers to obtaining a ride. 22. Wikipedia—a crowd-sourced, online encyclopedia designed to capture the consensus view of its users—states that “Lyft is an on-demand transportation company.” 23. On October 9, 2018, Lyft announced that it had hired Anthony Foxx, the former 10 Secretary of Transportation under President Barack Obama, as its Chief Policy Officer and Advisor 11 to the Co-Founders. Mr. Foxx described why it was natural for him to bring his expertise to Lyft, 12 noting that “Lyft is, at its core, a transportation company.” Mr. Foxx added that “Lyft has built its 13 brand on getting you there and caring about how you get there.” 14 B. LYFT’S DRIVERS 15 24. Lyft drivers receive ride requests through the driver version of the Lyft app. 16 25. Drivers can go “online” by opening the app on their smartphones. That signals to 17 Lyft that they are ready to give rides. 18 26. Lyft can then send ride requests to the drivers who are online. 19 27. Drivers have no control over when, whether, or how many rides Lyft will route to 20 them. And the driver app does not allow drivers to specify that they wish to receive rides from any 21 particular customer(s). 22 28. Lyft gives drivers 15 seconds to decide whether to accept a ride request. If a driver 23 declines the request or takes longer than 15 seconds to decide, then Lyft withdraws the request and 24 sends it to another driver. 25 29. Lyft does not allow drivers to know where a customer wants to go before the drivers 26 accept or decline a ride. Instead, the Lyft driver app tells a driver where the customer wants to go 27 only after the driver has arrived to pick up the rider. 28 -4- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 5 of 11 1 30. This is because the drivers—who Lyft pays based on time and distance—likely 2 would decline shorter rides to wait for longer, better paying ones. Lyft does not give the drivers the 3 option to do so, in order to make sure that all of Lyft’s customers can get rides regardless of 4 distance. 5 31. Lyft sets the fares that it charges its customers; drivers cannot adjust the fares. 6 32. Lyft decides what portion of the charged fares are paid to the driver; drivers cannot 7 8 9 adjust that amount, either. 33. Aside from certain bonuses and incidental payments, the driver’s portion of each fare is the only compensation Lyft pays to drivers. 10 34. 11 pick up a customer. 12 35. Lyft does not pay drivers for time spent waiting for rides or time spent driving to Lyft also decides whether to charge customers a cancellation fee. So if a customer 13 requests a ride, Lyft dispatches a driver, the driver drives 10 minutes to the customer, but then the 14 customer cancels, it is up to Lyft to decide whether to charge the customer a fee. 15 36. Because Lyft classifies its drivers as independent contractors, rather than 16 employees, it makes no effort to ensure it pays the minimum wage required in the relevant 17 jurisdiction or any required overtime. 18 37. Lyft also does not comply with state and local rest-break or sick-time laws for its 19 drivers, or with any federal, state, or local wage, sick-time, or other employee-benefit notice 20 requirements for its drivers. 21 38. Lyft makes it difficult for drivers to understand their true rate of pay. 22 39. The weekly pay statements Lyft makes available to drivers do not track the full 23 number of hours worked or mileage driven, both of which a driver would need to determine their 24 true net hourly wage that week. 25 26 40. The monthly and annual statements Lyft provides to drivers likewise do not provide the data drivers would need to calculate their true wages. 27 28 -5- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 6 of 11 1 C. LYFT IS VIOLATING FEDERAL AND CALIFORNIA LAW 2 41. Courts determine whether a worker is an employee under the Fair Labor Standards 3 Act by looking to the economic substance of the relationship, not the label adopted by an employer. 4 See Real v. Driscoll Strawberry Associates, Inc., 603 F.2d 748, 754 (9th Cir. 1979). 5 6 42. In assessing that economic relationship, courts look to a non-exhaustive list of factors that includes: 7 8 9 10 11 12 13 14 43. • the degree of the employer’s right to control the manner in which the work is to be performed; • the worker’s opportunity for profit or loss depending upon his or her managerial skill; • the investment of the worker relative to his or her putative employer and whether he or she employs helpers; • whether the service rendered requires a special skill; • whether the worker has an ongoing relationship with the employer; and • whether the service rendered is an integral part of the employer's business. The ultimate inquiry is whether the worker is truly operating an independent 15 business, free from the economic dominance of an employer. 16 44. Under California Law, a worker is classified as an employee unless the hiring 17 business proves that (A) the worker is free from the control and direction of the hiring business, 18 (B) the worker performs work that is outside the usual course of the hiring entity’s business, and 19 (C) the worker is customarily engaged in an independently established trade, occupation, or 20 business and takes the usual steps to establish and promote his or her independent business separate 21 from working for an employer. Dynamex Operations W. v. Superior Court, 4 Cal. 5th 903, 925 22 (2018), reh’g denied (June 20, 2018). 23 45. Plaintiffs qualify as employees under both federal and California law. 46. Lyft exercises significant control over Plaintiffs by determining which rides they are 24 25 offered; how much they will be paid for each ride; when they receive critical information about 26 each ride; and how to resolve disputes and complaints regarding each ride. 27 28 -6- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 7 of 11 1 47. Because Lyft sets all the material terms of driving for Lyft, Plaintiffs cannot use 2 managerial skill to increase their profits; their compensation turns predominately on the number of 3 hours they drive and whether they respond to the financial incentives Lyft sets for them. 4 5 48. Plaintiffs have invested minimal to no capital in their work for Lyft, and they do not operate a transportation-based business independent of Lyft. 6 49. Plaintiffs bring no specialized skill to the job. 7 50. Plaintiffs work for Lyft on an ongoing basis. 8 51. Plaintiffs’ work is integral to Lyft as they, and other drivers, make up the core 9 workforce that provides Lyft’s rides. 10 D. THE HARM TO PLAINTIFFS 11 52. Plaintiffs all drive for Lyft, with each Plaintiff typically driving more than 25 hours 12 per week. 13 53. Plaintiffs drive in the Los Angeles and San Francisco Bay areas. 14 54. Plaintiffs’ true wages are difficult to calculate accurately, as Lyft’s wage statements 15 16 17 do not contain weekly mileage figures. 55. Nevertheless, it is clear that Lyft regularly fails to pay Plaintiffs the required minimum wage, after accounting for their expenses. 18 56. Lyft never pays Plaintiffs a premium wage when they work overtime. 19 57. Lyft has refused Plaintiffs’ repeated requests to view their full pay records, even 20 21 22 though such access is required by California law. 58. Lyft also has failed to give Plaintiffs rest breaks, paid sick time, and notice of any of their employment rights under state and local law. 23 CAUSES OF ACTION 24 COUNT I FAIR LABOR STANDARDS ACT, 29 U.S.C §§ 206, 207 MINIMUM WAGE & OVERTIME VIOLATIONS 25 26 59. Plaintiffs incorporate all previous allegations here. 27 60. Plaintiffs are employees entitled to the protections of the Fair Labor Standards Act. 28 -7- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 8 of 11 1 2 3 4 61. Lyft has violated the Act by willfully failing to regularly pay Plaintiffs the minimum wage and overtime the Act requires. 62. Plaintiffs therefore seek an injunction, unpaid wages, liquidated damages, interest, and attorneys’ fees and costs. 5 COUNT II CALIFORNIA LABOR CODE, WAGE ORDER NO. 9 MINIMUM WAGE & OVERTIME VIOLATIONS 6 7 63. Plaintiffs incorporate all previous allegations here. 8 64. Plaintiffs are employees entitled to the protections of the California Labor Code as 9 10 11 12 13 14 15 interpreted by Wage Order 9 of the Industrial Welfare Commission. 65. Lyft has violated the California Labor Code by failing to regularly pay Plaintiffs the minimum wage and overtime it requires. 66. Plaintiffs therefore seek an injunction, unpaid wages, interest, and attorneys’ fees and costs. COUNT III APPLICABLE MUNICIPAL CODES MINIMUM WAGE, OVERTIME, SICK TIME, NOTICE VIOLATIONS 16 67. Plaintiffs incorporate all previous allegations here. 17 68. In various weeks, Plaintiffs have qualified as employees entitled to the protections 18 of the following: 19 • Berkeley Municipal Code Chs. 13.99 & 13.100 20 • Cupertino Municipal Code Ch. 3.37 21 • El Cerrito Municipal Code Ch. 6.95 22 • Emeryville Municipal Code Ch. 37 23 • Los Altos Municipal Code Ch. 3.50 24 • Los Angeles Municipal Code Ch. XVIII 25 • Los Angeles County Code Chs. 8.100, 8.101 26 • Mountain View City Code Ch. 42 27 • Oakland Municipal Code Ch. 5.92 28 • Palo Alto Municipal Code Ch. 4.62 -8- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 9 of 11 1 • Pasadena Code of Ordinances Ch. 5.02 2 • Richmond Municipal Code Ch. 7.108 3 • San Diego Municipal Code Ch. 3, Art. 9 4 • San Francisco Administrative Code Chs. 12R, 12W 5 • San Jose Municipal Code Ch. 4.100 6 • San Leandro Municipal Code Ch. 4-35 7 • San Mateo Municipal Code Ch. 5.92 8 • Santa Clara City Code Ch. 3.20 9 • Santa Monica Municipal Code Ch. 4.62 10 • Sunnyvale Municipal Code Ch. 3.80 11 12 13 14 69. Lyft has violated those ordinances by failing to regularly pay Plaintiffs minimum wage, and by failing to comply with the applicable sick time and notice requirements. 70. Plaintiffs subject to those violations therefore seek an injunction, unpaid wages, liquidated damages, interest, statutory penalties, and attorneys’ fees and costs. 15 COUNT IV CALIFORNIA LABOR CODE, § 226(A), (E) WAGE STATEMENT VIOLATION 16 17 71. Plaintiffs incorporate all previous allegations here. 18 72. Plaintiffs are employees under California law. 19 73. Lyft has failed to provide Plaintiffs a wage statement that is compliant with 20 21 California law. 74. 22 Plaintiffs therefore seek statutory penalties and attorneys’ fees and costs. COUNT V CALIFORNIA LABOR CODE, § 226(B), (F) FAILURE TO ALLOW ACCESS TO EMPLOYMENT RECORDS 23 24 75. Plaintiffs incorporate all previous allegations here. 25 76. Plaintiffs are employees under California law. 26 77. Lyft has refused, in violation of California Labor Code § 226(b) and (f), Plaintiffs’ 27 28 repeated requests to access their employment records. 78. Plaintiffs therefore seek statutory penalties and attorneys’ fees and costs. -9- Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 10 of 11 1 COUNT VI UNFAIR COMPETITION LAW, CAL. BUS. & PROF. CODE § 17200 UNFAIR AND UNLAWFUL BUSINESS PRACTICES 2 3 79. Plaintiffs incorporate all previous allegations here. 4 80. By committing the legal violations described above, Lyft has committed unfair and 5 unlawful business practices in violation of the Unfair Competition Law. 6 81. Plaintiffs therefore seek restitution, an injunction, and attorneys’ fees and costs. 7 82. Plaintiffs seek a public injunction on behalf of all Lyft drivers in California. PRAYER FOR RELIEF 8 9 10 11 12 13 14 15 16 17 18 19 20 21 83. Plaintiffs seek a judgment against Lyft that incorporates the following relief: (a) A declaratory judgment that the policies and practices complained of herein are unlawful under federal and California law; (b) An award of appropriate equitable and injunctive relief to remedy Defendants' violations of the federal and California law, including, but not limited to, an order enjoining Defendants from continuing their unlawful policies and practices; (c) An award of damages, statutory penalties, and restitution to be paid by Defendants according to proof; (d) An award of general damages according to proof; (e) An award to Plaintiffs for unpaid wages owed to them pursuant to the FLSA; (f) An award of reasonable attorneys’ fees and costs incurred by Plaintiffs in filing this action pursuant to Labor Code §§ 218.5 and 1194, Code of Civil Procedure § 1021.5, and other applicable laws; (g) An award of pre- and post- judgment interest to Plaintiffs on these damages; and (h) Such further relief as this court deems appropriate. DEMAND FOR JURY TRIAL 22 NOW COME Plaintiffs, by and through their Attorneys, and hereby demand a trial by jury 23 on all issues triable by jury. 24 25 26 27 28 - 10 - Case 3:18-cv-07482-JCS Document 1 Filed 12/12/18 Page 11 of 11 1 Dated: December 12, 2018 Respectfully submitted, 2 /s/ Keith A. Custis Keith A. Custis kcustis@custislawpc.com CUSTIS LAW, P.C. 1875 Century Park East, Suite 700 Los Angeles, California 90067 (213) 863-4276 3 4 5 6 Ashley Keller (pro hac vice forthcoming) ack@kellerlenkner.com Travis Lenkner (pro hac vice forthcoming) tdl@kellerlenkner.com Tom Kayes (pro hac vice forthcoming) tk@kellerlenkner.com KELLER LENKNER LLC 150 N. Riverside Plaza, Suite 4270 Chicago, Illinois 60606 Tel: (312) 741-5220 7 8 9 10 11 12 13 Warren Postman (pro hac vice forthcoming) wdp@kellerlenkner.com KELLER LENKNER LLC 1300 I Street, N.W., Suite 400E Washington, D.C. 20005 Tel: (202) 749-8334 14 15 16 17 Attorneys for Plaintiffs 18 19 20 21 22 23 24 25 26 27 28 - 11 -