Uber may be about to owe a lot of users money.
The ride-sharing service announced a $28.5 million class action settlement proposal Thursday in response to lawsuits by riders alleging its “Safe Ride Fee” constitutes false advertising.
The proposal will attempt to settle Philliben v. Uber Technologies, Inc. and Mena v. Uber Technologies, Inc., which seek restitution for Uber’s $1 “Safe Ride Fee.” Complainants argue the name is misleading and that the company’s driver background checks are not “industry leading,” as Uber previously claimed. Uber allowed drivers with felony convictions to work for the ride-sharing service, according to legal records.
“No means of transportation can ever be 100 percent safe,” Uber said in a statement Thursday. “Accidents and incidents do happen. That’s why it’s important to ensure that the language we use to describe safety at Uber is clear and precise.”
If approved by the U.S. District Court for the District of Northern California, the settlement’s damages would be divided among the 25 million riders who paid Uber’s $1 Safe Ride Fee in the United States between Jan. 1, 2013 and Jan. 31, 2016. The payout would be a little more than $1 per rider, before legal fees, to be reimbursed to a user’s credit card or Uber account.
Regardless of whether the class action settlement proposal is approved, a decision that could take several weeks, Uber said it will re-label its “Safe Ride Fee” as a “Booking Fee,” which the company notes is similar to competitor Lyft’s “Trust & Service Fee.”
