Barysas v. Uber Technologies Inc.

CourtDistrict Court, S.D. Texas
DecidedJuly 14, 2023
Docket4:22-cv-03876
StatusUnknown

This text of Barysas v. Uber Technologies Inc. (Barysas v. Uber Technologies Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Barysas v. Uber Technologies Inc., (S.D. Tex. 2023).

Opinion

UNITED STATES DISTRICT COURT July 14, 2023 SOUTHERN DISTRICT OF TEXAS Nathan Ochsner, Clerk HOUSTON DIVISION DAINIUS BARYSAS, § § Plaintiff. § § V. § CIVIL ACTION NO. 4:22-cv-03876 § UBER TECHNOLOGIES INC., § § Defendant. §

MEMORANDUM AND RECOMMENDATION This matter comes before me on a Motion to Vacate Arbitration Award (Dkt. 1-2) brought by Plaintiff Dainius Barysas (“Barysas”), and a Motion to Confirm Arbitration Award and for Final Judgment (Dkt. 8) brought by Defendant Uber Technologies, Inc. (“Uber”). After reviewing the briefing, the record, and the applicable law, I recommend that the Motion to Vacate Arbitration Award be DENIED, and the Motion to Confirm Arbitration Award and for Final Judgment be GRANTED. My reasoning follows. BACKGROUND Barysas worked as an Uber driver from 2014 to 2019. During those five years, Barysas claims the company willfully failed to pay him minimum wages and overtime compensation as required by the Fair Labor Standards Act (“FLSA”). Barysas maintains that Uber misclassified him as an “independent contractor,” rather than an “employee,” to avoid paying him the amounts he was properly due. The FLSA’s overtime and minimum wage protections extend only to “employees.” See 29 U.S.C. §§ 206, 207. To recover monies allegedly owed him, Barysas initiated an arbitration proceeding against Uber in March 2020. He proceeded in arbitration, rather than litigation, because he agreed when he became an Uber driver that he would arbitrate any disputes he had with the company. The parties subsequently agreed to have former Texas State District Court Judge Susan Soussan (“Judge Soussan”) preside over the arbitration. After her appointment, Judge Soussan handled a number of pre-hearing matters. These included motions by both parties to compel production , a request by Uber to file a dispositive motion , a request by Uber to bifurcate the proceedings filed, and a motion by Uber for a protective order. Both parties submitted pre-hearing briefs. The final arbitration hearing took place over the course of three days (March 29, 2022 and May 2–3, 2022). Three individuals testified live. Both parties proffered numerous exhibits that were admitted into evidence. After the hearing concluded, the parties each filed a post-hearing brief. On July 19, 2022, Judge Soussan issued a 20-page Final Award, ruling in favor of Uber. In her Final Award, Judge Soussan noted that determining whether someone falls within the category of a covered “employee” or an exempted “independent contractor” requires a fact-finder to look to the “economic reality” of the relationship. Dkt. 8-1 at 13. She then addressed, one by one, the five non-exclusive factors the Fifth Circuit has identified to help determine whether a worker is an employee or independent contractor for FLSA purposes. Her ultimate conclusion: “[Barysas] was an independent contractor in business for himself. He was not Uber’s employee.” Id. at 20. A few months after Judge Soussan issued her Final Award, Barysas filed this action in state court in Harris County, Texas, seeking to vacate the arbitration award. Uber then removed the matter to federal court on the basis of diversity jurisdiction. Once the case landed in federal court, Uber responded to Barysas’s Motion to Vacate Arbitration Award and filed a separate Motion to Confirm Arbitration Award and for Final Judgment. The pending motions in this case have been referred to me for a report and recommendation. JUDICIAL REVIEW OF ARBITRATION AWARDS Given the strong federal policy favoring arbitration, “[j]udicial review of an arbitration award is extraordinarily narrow.” Antwine v. Prudential Bache Sec., Inc., 899 F.2d 410, 413 (5th Cir. 1990). Indeed, the Fifth Circuit has described it as “among the narrowest known to the law.” Del Casal v. E. Airlines, Inc., 634 F.2d 295, 298 (5th Cir. Unit B Jan. 1981). “Arbitration awards are subject to very limited review in order to avoid undermining the twin goals of arbitration, namely, settling disputes efficiently and avoiding long and expensive litigation.” Folkways Music Publishers, Inc. v. Weiss, 989 F.2d 108, 111 (2d Cir. 1993); see also First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 942 (1995) (an arbitrator’s decision will be vacated “only in very unusual circumstances”). Accordingly, I must “defer to the arbitrator’s decision when possible.” Antwine, 899 F.2d at 413. This deference is “needed to maintain arbitration’s essential virtue of resolving disputes straightaway.” Hall St. Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 588 (2008). I am not permitted to vacate an arbitrator’s decision simply because I disagree with the result of the arbitration or because I believe that the arbitrator made a serious legal or factual error. See Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 568 (2013). The Federal Arbitration Act (“FAA”) provides the exclusive grounds for vacating an arbitration award. Under § 10(a) of the FAA, an arbitration award may be vacated under the following limited circumstances: (1) where the award was procured by corruption, fraud, or undue means;

(2) where there was evident partiality or corruption in the arbitrators, or either of them;

(3) where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced; or (4) where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made. 9 U.S.C. § 10(a). The FAA provides that a party to an arbitration may apply to the court for an order confirming the arbitration award within one year after the award is issued, and the court “must grant such an order unless the award is vacated, modified, or corrected as prescribed in sections 10 and 11 of” the FAA. Id. § 9. ANALYSIS Barysas raises a number of arguments as to why he believes the arbitration award should be vacated. I address each of those reasons below. A. EXCEEDING THE ARBITRATOR’S POWERS Barysas first argues that Judge Soussan exceeded her powers because she “haphazardly applied a novel legal theory combining the economic realities test with selective portions of a Department of Labor Guideline.” Dkt. 1-2 at 8. This argument implicates § 10(a)(4), which provides for vacatur of an arbitration award “where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.” 9 U.S.C. § 10(a)(4). A party seeking to set aside an arbitral award under § 10(a)(4) “bears a heavy burden.” Oxford Health Plans, 569 U.S. at 569; see also Timegate Studios, Inc. v. Southpeak Interactive, L.L.C., 713 F.3d 797, 802–03 (5th Cir.

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Barysas v. Uber Technologies Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/barysas-v-uber-technologies-inc-txsd-2023.