Osvatics v. Lyft, Inc.

• Court: District Court, District of Columbia
• Decided: April 22, 2021
• Docket: Civil Action No. 2020-1426
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

) CASSANDRA OSVATICS, on behalf of ) herself and all others similarly situated, ) ) Plaintiff, ) ) v. ) No. 20-cv-1426 (KBJ) ) LYFT, INC., ) ) Defendant. ) )

MEMORANDUM OPINION

Plaintiff Cassandra Osvatics worked as a driver for the ride-sharing company

Lyft, Inc. in the Washington, D.C. metropolitan area from November of 2015 to June of

2018. (See Compl., ECF No. 2, ¶¶ 7–10.) In May of 2020, Osvatics filed a putative

class-action lawsuit against Lyft, alleging that Lyft was engaged in a continuous

violation of District of Columbia law by failing to provide paid sick leave to its drivers

in the District. (See id. ¶¶ 79, 90–99.) According to Lyft, however, Osvatics had

agreed to the company’s Terms of Service for its drivers, which require any disputes

between Lyft and its drivers to be resolved by arbitration on an individual basis rather

than through the filing of a lawsuit. (See Decl. of Neil Shah in Supp. of Def.’s Mot.

(“Shah Decl.”), ECF No. 6-2, ¶¶ 8, 13.)

Before this Court at present is Lyft’s motion to compel individual arbitration of

Osvatics’s claim and to stay the instant proceedings pending any arbitration between the

parties. (See Def.’s Mot. to Compel Individual Arbitration and Stay Proceedings

Pending Arbitration, ECF No. 6; Def.’s Mem. in Supp. of Mot. to Compel Individual Arbitration and Stay Proceedings Pending Arbitration (“Def.’s Mot.”), ECF No. 6-1.)

Lyft contends that the arbitration agreement and the associated class waiver in its

Terms of Service are valid, and thus the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1

et seq., requires this Court to enforce the arbitration agreement by compelling Osvatics

to submit this dispute to individual arbitration. (See Def.’s Mot. at 9–10.) 1 Osvatics

responds, in part, that the FAA does not apply to her agreement with Lyft given section

1 of the statute, which provides that the “contracts of employment” of any “class of

workers engaged in . . . interstate commerce” are categorically exempt from the FAA’s

coverage. (See Pl.’s Opp’n to Def.’s Mot. to Compel Individual Arbitration and Stay

Proceedings Pending Arbitration (“Pl.’s Opp’n”), ECF No. 20, at 19 (quoting 9 U.S.C.

§ 1).)

On March 31, 2021, this Court issued an Order that GRANTED Lyft’s motion to

compel arbitration. (See Order, ECF No. 47.) This Memorandum Opinion explains the

reasons for that Order. In short, and as explained fully below, this Court has concluded

that Osvatics is bound by Lyft’s arbitration agreement and that the section 1 exemption

does not apply to rideshare drivers such as Osvatics. Therefore, the FAA requires this

Court to compel arbitration of the instant dispute.

I. BACKGROUND

A. Lyft’s Terms Of Service

Lyft operates a ride-sharing mobile application that enables customers who seek

rides to specified destinations to hail drivers willing to drive them to those destinations.

1 Page number citations to the documents that the parties and the Court have filed refer to the page numbers that the Court’s electronic filing system automatically assigns.

2 (See Compl. ¶¶ 17–18; see also Shah Decl. ¶ 3.) To become a Lyft driver, an individual

must download the Lyft application, register as a driver, and agree to Lyft’s Terms of

Service. (See Shah Decl. ¶¶ 4–5.) Prospective drivers presented with the Terms of

Service can scroll through the text of the agreement, and they must ultimately click the

“I Agree” button at the bottom of the screen before they can begin offering rides

through the Lyft application. (See id. ¶¶ 7–9.) Lyft periodically updates these Terms of

Service, and drivers are required to consent to the updated terms in order to continue

offering rides through Lyft’s application. (Id. ¶ 6.)

The most recent version of Lyft’s Terms of Service to which Osvatics allegedly

agreed is dated November 27, 2019. (See Ex. A to Suppl. Decl. of Neil Shah (“2019

Terms of Service”), ECF No. 28-3, at 2.) The second and third paragraphs of the

agreement read as follows:

PLEASE BE ADVISED: THIS AGREEMENT CONTAINS PROVISIONS THAT GOVERN HOW CLAIMS BETWEEN YOU AND LYFT CAN BE BROUGHT (SEE SECTION 17 BELOW). THESE PROVISIONS WILL, WITH LIMITED EXCEPTION, REQUIRE YOU TO SUBMIT CLAIMS YOU HAVE AGAINST LYFT TO BINDING AND FINAL ARBITRATION ON AN INDIVIDUAL BASIS, NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY CLASS, GROUP OR REPRESENTATIVE ACTION OR PROCEEDING. AS A DRIVER OR DRIVER APPLICANT, YOU HAVE AN OPPORTUNITY TO OPT OUT OF ARBITRATION WITH RESPECT TO CERTAIN CLAIMS AS PROVIDED IN SECTION 17.

By entering into this Agreement, and/or by using or accessing the Lyft Platform you expressly acknowledge that you understand this Agreement (including the dispute resolution and arbitration provisions in Section 17) and accept all of its terms. IF YOU DO NOT AGREE TO BE BOUND BY THE TERMS AND CONDITIONS OF THIS AGREEMENT, YOU MAY NOT USE OR ACCESS THE LYFT PLATFORM OR ANY OF THE SERVICES PROVIDED THROUGH THE LYFT PLATFORM. If you use the Lyft Platform in another country, you agree to be subject to Lyft’s terms of service for that country.

3 (Id.) The underlined phrase contains a hyperlink to Section 17 of the Terms of Service.

(See Shah Decl. ¶ 7.)

Section 17 is titled “Dispute Resolution and Arbitration Agreement[.]” (2019

Terms of Service at 14.) It provides that, with exceptions not relevant here, “ALL

DISPUTES AND CLAIMS BETWEEN US . . . SHALL BE EXCLUSIVELY

RESOLVED BY BINDING ARBITRATION SOLELY BETWEEN YOU AND LYFT.”

(Id.) It continues: “[t]hese Claims include, but are not limited to, any dispute, claim or

controversy, whether based on past, present, or future events, arising out of or relating

to” many categories of disputes, including “any city, county, state or federal wage-hour

law[.]” (Id.) Section 17 also contains a delegation clause, which provides that “[a]ll

disputes concerning the arbitrability of a Claim (including disputes about the scope,

applicability, enforceability, revocability or validity of the Arbitration Agreement) shall

be decided by the arbitrator,” with certain exceptions not relevant here. (Id.) And it

contains the following language waiving the driver’s right to institute a class action:

“YOU UNDERSTAND AND AGREE THAT YOU AND LYFT MAY EACH BRING

CLAIMS IN ARBITRATION AGAINST THE OTHER ONLY IN AN INDIVIDUAL

CAPACITY AND NOT ON A CLASS, COLLECTIVE ACTION, OR

REPRESENTATIVE BASIS[.]” (Id. at 15.)

Importantly for present purposes, Section 17 of the Terms of Service also

contains a subsection titled “Opting Out of Arbitration for Driver Claims That Are Not

In a Pending Settlement Action.” (Id. at 18.) That subsection provides that drivers

“may opt out of arbitration with respect to . . . Driver Claims, other than those in a

Pending Settlement Action, by notifying Lyft in writing of your desire to opt out of

4 arbitration for such Driver Claims . . . within 30 days of the date this Agreement is

executed by you[,]” so long as “you have not previously agreed to an arbitration

provision in Lyft’s Terms of Service where you had the opportunity to opt out of the

requirement to arbitrate.” (Id.) Finally, the Terms of Service further specifies that

“[t]his agreement to arbitrate . . . is governed by the Federal Arbitration Act” (id. at

14); however, the remainder of the Terms of Service “shall be governed by the laws of

the State of California without regard to choice of law principles” (id. at 21).

B. Procedural History

Osvatics filed the instant lawsuit against Lyft on May 29, 2020. (See Compl.

¶ 6.) The complaint asserts one legal claim: that Lyft drivers are “employees” of Lyft

within the meaning of the District of Columbia’s Accrued Safe and Sick Leave Act,

D.C. Code § 32-531.01 et seq., and that Lyft thus violated that statute by failing to

provide paid sick leave to Lyft drivers in the District. (See id. ¶¶ 90–99.) Moreover,

the complaint seeks to assert similar claims on behalf of a class consisting of “all

drivers who work or worked for Lyft in the District of Columbia for at least 90 days

between when Lyft began operating in the District of Columbia and the date of final

judgment in this matter[.]” (Id. ¶ 79.) For relief, the complaint requests monetary

damages, a declaration that Lyft’s practices regarding sick leave violate District of

Columbia law, and an order enjoining Lyft from continuing its allegedly unlawful

practices. (See id., Prayer for Relief.)

On June 16, 2020, Lyft moved to compel individual arbitration of Osvatics’s

claim and to stay the instant lawsuit pending any arbitration of Osvatics’s claim on an

individual basis. (See Def.’s Mot. at 9–10; see also Def.’s Reply in Supp. of Mot. to

Compel Individual Arbitration and Stay Proceedings Pending Arbitration (“Def.’s

5 Reply”), ECF No. 28, at 8.) As cause, Lyft maintains that, according to its business

records, Osvatics accepted Lyft’s Terms of Service for drivers on four separate

occasions—on October 4, 2015; October 30, 2016; May 4, 2018; and May 4, 2020

(Def.’s Mot. at 11 (citing Shah Decl. ¶ 13))—and, pursuant to the embedded arbitration

provision, Osvatics’s legal claim must be resolved through arbitration on an individual

basis rather than class-action litigation, per the FAA. (See id. at 18–20.) Lyft also

contends that section 1 of the FAA, which exempts the employment contracts of certain

transportation workers from the FAA’s coverage, does not apply to the arbitration

agreement between Osvatics and Lyft, both because that exemption covers only workers

who transport goods rather than passengers (see id. at 34–36), and because Lyft drivers

as a class are not “engaged in . . . interstate commerce” within the meaning of the

statute (see id. at 22–34). Further, even if the FAA does not apply, Lyft asserts that the

District of Columbia’s Revised Uniform Arbitration Act, D.C. Code § 16-4401 et seq.,

similarly requires this Court to compel arbitration of this dispute and stay the instant

proceedings. (See id. at 37–39.)

In her brief in opposition to Lyft’s motion, Osvatics contends that she is not

bound by Lyft’s Terms of Service, including its arbitration provision, essentially

because she had stopped driving for Lyft and did not intend to resume driving for the

company when she most recently accepted the Terms of Service in May of 2020. (See

Pl.’s Opp’n at 43–47.) Osvatics also argues that the arbitration agreement at issue here

is not enforceable under the FAA because D.C. area Lyft drivers—or, in the alternative,

all Lyft drivers nationwide—are engaged in interstate commerce such that they fall

within the section 1 exemption. (See id. at 18–33.) Finally, Osvatics asserts that the

6 arbitration agreement is also not enforceable under District of Columbia law. (See id.

at 33–43.) 2

This Court held a hearing on Lyft’s motion on January 14, 2021. (See Min.

Entry of Jan. 14, 2021.) In addition, both before and after the motion hearing, the

parties filed multiple notices of supplemental authority and responses thereto. (See

ECF Nos. 21, 29, 30, 32, 33, 35, 36, 38, 39, 41, 42, 43, 44, 45). Lyft’s motion to

compel arbitration and stay the instant proceedings pending arbitration is now ripe for

decision.

II. STATUTORY FRAMEWORK AND LEGAL STANDARD

A. The Federal Arbitration Act And The Section 1 Exemption

Congress enacted the FAA in 1925 “in response to a perception that courts were

unduly hostile to arbitration.” Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612, 1621 (2018).

The FAA establishes “a liberal federal policy favoring arbitration” and reflects “the

fundamental principle that arbitration is a matter of contract[.]” AT&T Mobility LLC v.

Concepcion, 563 U.S. 333, 339 (2011) (internal quotation marks and citations omitted).

Accordingly, the FAA requires courts to “place arbitration agreements on an equal

footing with other contracts” and “enforce them according to their terms[.]” Id.; see

also 9 U.S.C. § 2 (providing that certain arbitration agreements “shall be valid,

irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the

revocation of any contract”). The statute also “establishes procedures by which federal

courts implement” this “substantive rule.” Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S.

2 The District of Columbia, through its Attorney General, filed an amicus brief in support of Osvatics’s contention that Lyft’s arbitration agreement would be unenforceable under District of Columbia law. (See Amicus Curiae Br. of D.C. in Supp. of Pl.’s Opp’n, ECF No. 24, at 10.)

7 63, 68 (2010). Specifically, section 4 of the FAA permits litigants to seek a court order

“directing the parties to proceed to arbitration in accordance with the terms of the

agreement[,]” see 9 U.S.C. § 4, and section 3 of the statute requires courts to stay

litigation “until such arbitration has been had in accordance with the terms of the

agreement” if the court concludes that the action involves “any issue referable to

arbitration[,]” see id. § 3.

Notably, however, these enforcement mechanisms do not “extend to all private

contracts, no matter how emphatically they may express a preference for arbitration.”

New Prime Inc. v. Oliveira, 139 S. Ct. 532, 537 (2019). Rather, “antecedent statutory

provisions limit the scope of the court’s powers under §§ 3 and 4.” Id. Section 2 of the

FAA provides that the statute applies only to arbitration agreements that are set forth as

a “written provision in any maritime transaction or a contract evidencing a transaction

involving commerce[.]” 9 U.S.C. § 2; see also id. § 1 (defining “commerce” to include

“commerce among the several States” and “between the District of Columbia and any

State”). Moreover, as particularly relevant here, section 1 contains a further limitation

on the FAA’s coverage: it specifies that “nothing” in the FAA “shall apply to contracts

of employment of seamen, railroad employees, or any other class of workers engaged in

foreign or interstate commerce.” Id. § 1 (emphasis added). The italicized language is

sometimes referred to as the “residual clause[,]” see, e.g., Waithaka v. Amazon.com,

Inc., 966 F.3d 10, 16 (1st Cir. 2020), or the “transportation worker exemption[,]” see,

e.g., Rittmann v. Amazon.com, Inc., 971 F.3d 904, 907 (9th Cir. 2020). And the

Supreme Court has held that “a court should decide for itself whether § 1’s ‘contracts of

employment’ exclusion applies before ordering arbitration[,]” even if a delegation

8 clause in the arbitration agreement purports to give the arbitrator the authority to decide

that threshold question. See New Prime, 139 S. Ct. at 537–38.

The history of the section 1 exemption is “quite sparse[,]” Cir. City Stores, Inc.

v. Adams, 532 U.S. 105, 119 (2001), but the Supreme Court has surmised that the

purpose of section 1’s “very particular qualification” was that “Congress had already

prescribed alternative employment dispute resolution regimes for many transportation

workers[,]” including seamen and railroad workers, by the time it adopted the FAA in

1925, New Prime, 139 S. Ct. at 537; see also Circuit City, 532 U.S. at 121. Thus,

Congress apparently excluded seamen and railroad employees from the FAA because “it

did not wish to unsettle established or developing statutory dispute resolution schemes

covering” those workers. Circuit City, 532 U.S. at 121. Section 1’s residual clause

similarly reflects Congress’s “concern with transportation workers and their necessary

role in the free flow of goods”; indeed, through the residual clause, Congress

“reserv[ed] for itself more specific legislation for” other categories of workers engaged

in foreign or interstate commerce. Id. For instance, Congress amended the statutory

grievance procedures for railroad employees to extend to “air carriers and their

employees” a decade after the FAA’s enactment. See id.

B. Motions To Compel Arbitration

Under D.C. Circuit precedent, courts in this jurisdiction evaluate motions to

compel arbitration under the summary judgment standard of Federal Rule of Civil

Procedure 56. Aliron Int’l, Inc. v. Cherokee Nation Indus., Inc., 531 F.3d 863, 865

9 (D.C. Cir. 2008); see also Camara v. Mastro’s Rests. LLC, 952 F.3d 372, 373 (D.C. Cir.

2020); Jin v. Parsons Corp., 966 F.3d 821, 827 (D.C. Cir. 2020). 3

Summary judgment is appropriate if “there is no genuine issue as to any material

fact” and “the moving party is entitled to a judgment as a matter of law.” Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 247 (1986) (quoting Fed. R. Civ. P. 56). Because

“the party seeking to enforce an arbitration agreement” bears “the burden of proving

that” the other party “agreed to arbitrate[,]” Camara, 952 F.3d at 373, “[t]he party

seeking to compel arbitration must first present evidence sufficient to demonstrate an

enforceable agreement to arbitrate[,]” Ruiz v. Millennium Square Residential Ass’n, 466

F. Supp. 3d 162, 168 (D.D.C. 2020) (internal quotation marks and citation omitted).

The burden then “shifts to the non-moving party to raise a genuine issue of material fact

as to the making of the agreement, using evidence comparable to that identified in”

Rule 56. Id. (internal quotation marks and citation omitted). The court must grant

summary judgment with respect to the formation of an arbitration agreement if “the

pleadings and the evidence show that there is no genuine issue as to any material fact

3 Osvatics agrees that the summary judgment standard governs the question of whether the parties formed an arbitration agreement (see Pl.’s Opp’n at 44), but she contends that “the motion to dismiss standard” of Rule 12(b)(6) “is more appropriate when deciding the issue of Section 1’s application[,]” relying on a Third Circuit decision that similarly considered whether the section 1 exemption applies to rideshare drivers (see id. at 19 n.3 (citing Singh v. Uber Techs. Inc., 939 F.3d 210, 218 (3d Cir. 2019))). But not even the Third Circuit applies a different standard to those questions. As to both issues, it appears that the law in the Third Circuit is that “the motion to dismiss standard applies if the complaint and incorporated documents provide a sufficient factual basis for deciding the issue[,]” but “where those documents do not, or the plaintiff responds to the motion with additional facts that place the issue in dispute,” the court should permit “limited discovery” and then evaluate the motion to compel arbitration under the summary-judgment standard. See Singh, 939 F.3d at 218–19. The D.C. Circuit has not adopted such a hybrid standard in analyzing whether the parties formed an agreement to arbitrate. See, e.g., Jin, 966 F.3d at 827. Regardless, and in any event, this Court would reach the same conclusion regarding section 1’s applicability under the motion to dismiss standard, insofar as it concludes that Osvatics does not belong to a class of workers engaged in interstate commerce, even accepting as true all the allegations in Osvatics’s complaint, and without considering the exhibits attached to Lyft’s motion. See infra Part III.B.3.

10 and that the moving party is entitled to judgment as a matter of law.” Id. (internal

quotation marks and citation omitted).

Once the existence of a valid arbitration agreement has been established,

however, “the party resisting arbitration bears the burden of proving that the claims at

issue are unsuitable for arbitration.” Sakyi v. Estée Lauder Cos., 308 F. Supp. 3d 366,

375 (D.D.C. 2018) (quoting Green Tree Fin. Corp.-Ala. v. Randolph, 531 U.S. 79, 91

(2000)). Thus, the party claiming that section 1 exempts an arbitration agreement from

the FAA’s coverage bears the burden of proving that the exemption applies. See, e.g.,

Singh, 939 F.3d at 231–32 (Porter, J., concurring in part and concurring in the

judgment).

III. ANALYSIS

As explained above, Osvatics seeks to avoid arbitration of her claim against Lyft

on essentially three grounds. First, Osvatics asserts that she is not bound by the

arbitration clause in Lyft’s Terms of Service because she no longer intended to drive for

Lyft when she most recently agreed to the Terms of Service. (See Pl.’s Opp’n at 43–

47.) Second, Osvatics argues that the FAA and its enforcement provisions do not

govern the arbitration agreement here because Lyft drivers (in the D.C. area or

nationally) comprise a “class of workers engaged in . . . interstate commerce” under the

section 1 residual clause. (See id. at 18–33.) Third, assuming that the FAA does not

apply, Osvatics contends that the law of the District of Columbia would not permit

enforcement of the arbitration agreement. (See id. at 33–43.)

For the reasons detailed below, this Court finds that Osvatics’s express

agreement to abide by Lyft’s Terms of Service, along with her failure to opt out of the

11 arbitration agreement at any time, is sufficient to establish a binding agreement between

Osvatics and Lyft concerning the submission of disputes to arbitration in lieu of

litigation, and this Court agrees with the majority of courts that have considered the

section 1 issue that rideshare drivers are not encompassed by section 1’s residual

clause, such that their employment contracts are subject to the FAA. Therefore, this

Court concludes that it must compel arbitration and stay the instant proceedings under

the FAA, and accordingly does not reach whether arbitration should be compelled under

District of Columbia law if the FAA did not apply. 4

A. Osvatics Is Bound By The Arbitration Provision In Lyft’s Terms Of Service

Because “arbitration is a matter of contract[,]” Rent-A-Ctr., 561 U.S. at 67, the

“threshold issue” for a court faced with a motion to compel arbitration is whether the

parties entered into a valid and binding arbitration agreement, RDP Techs., Inc. v.

Cambi AS, 800 F. Supp. 2d 127, 138 (D.D.C. 2011); see also Henry Schein, Inc. v.

Archer & White Sales, Inc., 139 S. Ct. 524, 530 (2019) (“[B]efore referring a dispute to

an arbitrator, the court determines whether a valid arbitration agreement exists.”).

Moreover, “[w]hen deciding whether the parties agreed to arbitrate a dispute, courts

apply ‘ordinary state-law principles that govern the formation of contracts.’” Slaughter

v. Nat’l R.R. Passenger Corp., 460 F. Supp. 3d 1, 6 (D.D.C. 2020) (quoting First

Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995)).

4 Osvatics does not appear to contend that District of Columbia law precludes enforcement of the parties’ arbitration agreement even if the FAA applies to that agreement. (See Pl.’s Opp’n at 33 (“If the FAA does not apply, Lyft’s Motion to Compel must also be denied under D.C. law.”).) Thus, this Court has no occasion to decide whether the FAA preempts District of Columbia law to the extent that the arbitration agreement would be unenforceable under District of Columbia law due to the District’s public policy or unconscionability. (See id. at 38, 41; cf. Def.’s Mot. at 20.)

12 Here, the parties agree that District of Columbia common law governs the

contract-formation inquiry. (See Pl.’s Opp’n at 44; Def.’s Reply at 9.) And under the

District’s common law, “[a] contract is formed when there is an offer, an acceptance,

and valuable consideration” exchanged between the parties. Dixon v. Midland Mortg.

Co., 719 F. Supp. 2d 53, 57 (D.D.C. 2010) (citing Paul v. Howard Univ., 754 A.2d 297,

311 (D.C. 2000)). In other words, the parties must “express[] an intent to be bound,

agree[] to all material terms, and assume[] mutual obligations sufficient to create an

enforceable contract.” Eastbanc, Inc. v. Georgetown Park Assocs. II, L.P., 940 A.2d

996, 1004 (D.C. 2008).

In this Court’s view, Osvatics has not identified a genuine dispute of material

fact about whether the parties here formed a valid arbitration agreement. To start, Lyft

has met its initial burden to show that each of the elements of contract formation are

satisfied with respect to the arbitration provision in Lyft’s Terms of Service. Lyft’s

internal business records indicate that Osvatics agreed to Lyft’s Terms of Service as a

driver on four occasions: on October 4, 2015; October 30, 2016; May 4, 2018; and May

4, 2020. (Shah Decl. ¶ 13.) It is well established that Lyft’s method of obtaining

drivers’ assent to its Terms of Service—presenting the terms of the agreement and

requiring users to click “I Agree” before they can access the service (see id. ¶¶ 7–9)—

constitutes a valid means of offer and acceptance. See, e.g., Selden v. Airbnb, Inc.,

No. 16-cv-933, 2016 WL 6476934, at *4 (D.D.C. Nov. 1, 2016); see also Forrest v.

Verizon Commc’ns, Inc., 805 A.2d 1007, 1010–11 (D.C. 2002). Additionally, according

to Lyft’s records, Osvatics never opted out of the arbitration with Lyft pursuant to the

opt-out provision in the Terms of Service. (Shah Decl. ¶ 13; Suppl. Decl. of Neil Shah

13 in Supp. of Def.’s Mot., ECF No. 28-1, ¶ 9.) The parties also exchanged adequate

consideration: in return for Osvatics’s assent to the arbitration clause, Lyft provided

Osvatics access to its application as a driver, and Lyft further agreed to arbitrate any

disputes between the parties. See, e.g., 3511 13th St. Tenants’ Ass’n v. 3511 13th St.,

N.W. Residences, LLC, 922 A.2d 439, 443 (D.C. 2007) (explaining that “[a] promise is

a sufficient consideration for a return promise” (internal quotation marks and citation

omitted)); see also Booker v. Robert Half Int’l, Inc., 315 F. Supp. 2d 94, 101 (D.D.C.

2004) (observing that federal courts “have consistently concluded that arbitration

agreements contain adequate consideration . . . and therefore are enforceable”), aff’d,

413 F.3d 77 (D.C. Cir. 2005).

Osvatics, in turn, has not met her burden to identify a genuine issue of material

fact as to the formation of the arbitration agreement. She does not contest the accuracy

of Lyft’s internal records, or argue that she had insufficient notice of the arbitration

provision, or assert that she opted out of arbitration with Lyft at any point. (See Pl.’s

Opp’n at 44–47.) Instead, Osvatics claims that she did not “intend[] to be bound” by

the 2019 Terms of Service when she accepted that version of the agreement on May 4,

2020. (Id. at 44.) In particular, Osvatics asserts that she stopped driving for Lyft

around June 2018 and “did not seek to use any driver services offered on the Lyft App”

when she accessed the application in May of 2020 (Decl. of Cassandra Osvatics

(“Osvatics Decl.”), ECF No. 20-3, ¶¶ 2, 5); rather, she “merely checked the App to see

what information was maintained in it” (id. ¶ 7). Unfortunately for Osvatics, it is

black-letter contract law that contract formation depends on whether the parties

“objectively manifested a mutual intent to be bound contractually[,]” and that a party’s

14 “actual, subjective intentions” are irrelevant. Dyer v. Bilaal, 983 A.2d 349, 357 (D.C.

2009) (internal quotation marks and citation omitted). And it is clear to this Court that

Osvatics objectively manifested her intent to enter into a contract with Lyft by clicking

the “I Accept” button at the bottom of Lyft’s Terms of Service. Thus, Osvatics’s

statements regarding her subjective intent are insufficient to create a material factual

dispute regarding contract formation.

Notably, even if Osvatics was not bound by the 2019 Terms of Service, she

would be bound by the 2018 Terms of Service, which she accepted while she was still

driving for Lyft (see Shah Decl. ¶ 13; Osvatics Decl. ¶ 1), and which would have been

the governing version of Lyft’s Terms of Service had the 2019 version not superseded it

(see 2019 Terms of Service at 21). Osvatics has not identified any material differences

between the arbitration provisions contained in the 2018 and 2019 versions of the

Terms of Service. (See Tr. of Mot. Hr’g (“Hr’g Tr.”), ECF No. 40, at 22:12–20.) This

Court further concludes that Lyft is not foreclosed from relying in the alternative on the

2018 version of the agreement. Although Lyft’s opening brief only sought to compel

arbitration under the 2019 Terms of Service, it also plainly alleged that Osvatics

accepted Lyft’s Terms of Service on four separate occasions, which gave Osvatics

sufficient notice that Lyft might also rely on prior versions of the Terms of Service.

(See Def.’s Mot. at 11.) Furthermore, Lyft’s reply brief expressly referenced the 2015,

2016, and 2018 versions of the agreement as potential bases for compelling arbitration

(see Def.’s Reply at 11), and this Court gave Osvatics’s counsel an opportunity at the

motion hearing to address the previous versions of the Terms of Service (see Hr’g Tr. at

21:24–22:24). Thus, it appears that Osvatics is not prejudiced by Lyft’s arguably

15 belated reliance on the 2018 Terms of Service, and the Court will not conclude that Lyft

has somehow waived the argument that the 2018 Terms of Service (which is

indistinguishable from the 2019 Terms for the instant purposes) is binding on Osvatics.

This Court therefore holds that, as a matter of law, Osvatics entered into a valid

arbitration agreement with Lyft under either the 2019 version or the 2018 version of

Lyft’s Terms of Service.

B. Lyft Drivers Are Not A “Class Of Workers Engaged In Foreign Or Interstate Commerce” Exempt From The FAA Under Section 1

The most substantial issue that Lyft’s motion presents concerns whether

rideshare drivers such as Osvatics make up a “class of workers engaged in foreign or

interstate commerce” such that her “contract[] of employment” with Lyft is exempt

from the FAA’s coverage. See 9 U.S.C. § 1. 5 A majority of courts faced with this

question have concluded that rideshare drivers do not fall within the section 1 residual

clause. See, e.g., Rogers v. Lyft, Inc., 452 F. Supp. 3d 904, 916 (N.D. Cal. 2020);

Capriole v. Uber Techs., Inc., 460 F. Supp. 3d 919, 932 (N.D. Cal. 2020); Grice v. Uber

Techs., Inc., No. 18-cv-2995, 2020 WL 497487, at *9 (C.D. Cal. Jan. 7, 2020); Hinson

v. Lyft, Inc., No. 20-cv-2209, 2021 WL 838411, at *7 (N.D. Ga. Feb. 26, 2021);

Aleksanian v. Uber Techs. Inc., No. 19-cv-10308, 2021 WL 860127, at *9 (S.D.N.Y.

Mar. 8, 2021); see also In re Grice, 974 F.3d 950, 959 (9th Cir. 2020) (denying

mandamus petition on the ground that the district court did not commit “clear error as a

matter of law” in holding that rideshare driver was not subject to section 1 exemption

5 Lyft does not dispute that its Terms of Service agreement qualifies as a “contract of employment” within the meaning of the FAA’s section 1 exemption, notwithstanding the parties’ apparent disagreement about whether Lyft drivers are employees or independent contractors for purposes of the District’s paid sick leave law. See New Prime, 139 S. Ct. at 539 (explaining that section 1 encompasses “not only agreements between employers and employees but also agreements that require independent contractors to perform work”).

16 (internal quotation marks and citation omitted)). A few courts have reached the

opposite conclusion. See Cunningham v. Lyft, Inc., 450 F. Supp. 3d 37, 47 (D. Mass.

2020); Islam v. Lyft, Inc., No. 20-cv-3004, 2021 WL 871417, at *12 (S.D.N.Y. Mar. 9,

2021); Haider v. Lyft, Inc., No. 20-cv-2997, 2021 WL 1226442, at *4 (S.D.N.Y. Mar.

31, 2021). And some courts have ordered discovery before reaching a final

determination regarding section 1’s applicability to rideshare drivers. See, e.g., Singh,

939 F.3d at 227–28; Gonzalez v. Lyft, Inc., No. 19-cv-20569, 2021 WL 303024, at *6

(D.N.J. Jan. 29, 2021); Sienkaniec v. Uber Techs., Inc., 401 F. Supp. 3d 870, 871–73

(D. Minn. 2019).

This Court agrees with the majority approach; accordingly, it finds that the

arbitration agreement between Osvatics and Lyft is subject to the FAA. As explained

below, in reaching this conclusion, the Court makes two subsidiary determinations:

(1) that the section 1 exemption is not limited to transportation workers who transport

goods rather than people, and (2) that the relevant “class of workers” must be assessed

at a nationwide level rather than a specific geographic area.

1. Section 1’s Residual Clause Is Not Limited To Workers Who Transport Goods Rather Than Passengers

As previously noted, under section 1, the FAA does not “apply to contracts of

employment of seamen, railroad employees, or any other class of workers engaged in

foreign or interstate commerce.” 9 U.S.C. § 1. Lyft vigorously maintains that

“[s]ection 1 is limited to transportation workers who transport goods rather than

people” (Def.’s Mot. at 35), but this Court concludes that the FAA’s section 1

exemption, including its residual clause, encompasses both workers who transport

17 passengers and those who transport goods, see Singh, 939 F.3d at 219–26; Rogers, 452

F. Supp. 3d at 913–15.

To briefly summarize the persuasive reasoning of other jurists who have

analyzed this question, “[t]he traditional tools of statutory interpretation” all indicate

that “[s]ection 1 is not limited to classes of workers who transport goods in interstate

commerce.” Rogers, 452 F. Supp. 3d at 914. For one thing, the statutory text does not

distinguish between transportation of goods and passengers. See Singh, 939 F.3d at 221

n.4 (“[T]he term ‘commerce’ does not inhere a goods-versus-passengers distinction.”).

And to the extent that the language of the section 1 exemption is to be interpreted by

examining “evidence of [a] term’s meaning at the time of the [FAA’s] adoption in

1925[,]” New Prime, 139 S. Ct. at 539, it is clear that “the dominant understanding of

‘commerce’ when Congress passed the FAA in 1925” extended to the transportation of

passengers as well as physical goods, Singh, 939 F.3d at 229–30 & n.2 (Porter, J.,

concurring in part and concurring in the judgment) (citing dictionaries and Supreme

Court cases contemporaneous with the FAA’s enactment).

Statutory context further confirms this result. The ejusdem generis canon of

statutory interpretation counsels that, “[w]here general words follow specific words in a

statutory enumeration, the general words are [usually] construed to embrace only

objects similar in nature to those objects enumerated by the preceding specific words.”

Yates v. United States, 574 U.S. 528, 545 (2015) (internal quotation marks and citation

omitted). Applying this maxim to section 1 of the FAA, the Supreme Court has

instructed that “the residual clause should be read to give effect to the terms ‘seamen’

and ‘railroad employees,’ and should itself be controlled and defined by reference to the

18 enumerated categories of workers which are recited just before it[.]” Circuit City, 532

U.S. at 115. Because “seamen” and “railroad employees” transport passengers as well

as goods, it seems unlikely that Congress intended to limit the residual clause to

workers who transport only physical goods. See Singh, 939 F.3d at 221 (noting the

absence of “contemporary statutes or sources that define the terms ‘seamen’ and

‘railroad employees’ to only include those who transport goods”); Rogers, 452 F. Supp.

3d at 914 (“The ships and trains that transport passengers are staffed by seamen and

railroad workers, just like the ones that transport goods.”). Indeed, and notably, the

Supreme Court has observed that “shipboard surgeons who tended injured sailors”—and

thus were involved in the transportation of people—“were considered ‘seamen’” at the

time of the FAA’s enactment. New Prime, 139 S. Ct. at 543.

Against the weight of this interpretive guidance, Lyft primarily relies on dicta

from the Supreme Court’s decision in Circuit City and the D.C. Circuit’s decision in

Cole v. Burns International Security Services, 105 F.3d 1465 (D.C. Cir. 1997). In

Circuit City, the Supreme Court at several points used the term “goods” when

describing the scope of the section 1 residual clause. See Circuit City, 532 U.S. at 112

(noting that most courts of appeals had interpreted the residual clause as “limited to

transportation workers, defined, for instance, as those workers ‘actually engaged in the

movement of goods in interstate commerce’” (quoting Cole, 105 F.3d at 1471)); id. at

121 (explaining that Congress’s linkage of the residual clause to the enumerated

categories of seamen and railroad employees demonstrated its “concern with

transportation workers and their necessary role in the free flow of goods”). Lyft reads

that language as endorsing the proposition that the residual clause is necessarily limited

19 to transportation workers who transport goods rather than people. (See Def.’s Mot. at

34–35.) But the Supreme Court and the D.C. Circuit made those statements in the

context of deciding “whether the residual clause of § 1 covered the contracts of

employment of those who were not in the transportation industry at all[,]” Singh, 939

F.3d at 224; therefore, those courts “did not have the question of passengers versus

cargo before” them, id. at 224 n.8, and they “simply used ‘goods’ as a convenient

shorthand to discuss interstate commerce[,]” id. As a result, this Court agrees with the

authorities that have concluded that Circuit City and Cole are neither controlling nor

even persuasive on the issue of whether the section 1 residual clause encompasses

workers who transport passengers. See, e.g., Singh, 939 F.3d at 223–24; Rogers, 452 F.

Supp. 3d at 913–14. 6

Finally, Lyft resorts to “the FAA’s overarching policy in favor of arbitration[,]”

and thereby suggests that limiting the section 1 residual clause to workers who transport

goods “properly gives Section 1 a narrow construction[.]” (Def.’s Mot. at 35.) The

Supreme Court has emphatically rejected a similar appeal to the FAA’s general pro-

arbitration policy, explaining that “respecting the qualifications of § 1 . . . respect[s] the

limits up to which Congress was prepared to go when adopting the Arbitration Act.”

New Prime, 139 S. Ct. at 543 (internal quotation marks and citation omitted); see also

Rogers, 452 F. Supp. 3d at 915 (noting that “these general mantras can’t will a statute

6 To be sure, several courts (including another court in this jurisdiction) have reached the contrary conclusion, relying on the aforementioned language from Circuit City and Cole. See, e.g., Tyler v. Uber Techs., Inc., No. 19-cv-3492, 2020 WL 5569948, at *5 (D.D.C. Sept. 17, 2020) (holding that section 1 “only excludes from the provisions of the [FAA] the employment contracts of workers engaged in the transportation of goods in commerce” (quoting Cole, 105 F.3d at 1472)); Kowalewski v. Samandarov, 590 F. Supp. 2d 477, 483–84 (S.D.N.Y. 2008) (similar). This Court respectfully disagrees with that (non-binding) reading of those precedents, for the reasons explained above.

20 where text, history, and precedent won’t take it”). Thus, this Court too gives little

weight to Lyft’s general policy argument concerning the scope of section 1.

2. The Relevant Class of Workers Is Not Limited To Lyft Drivers In The D.C. Area

Osvatics argues that the applicable “class of workers” in the section 1 analysis

here is “D.C. Lyft drivers” (see Pl.’s Opp’n at 29), but this Court further concludes that,

when assessing whether a party belongs to a “class of workers engaged in foreign or

interstate commerce” for purposes of the FAA’s section 1 exemption, the relevant

“class of workers” must be defined at a nationwide level, and should not be limited to a

particular geographic area within the United States. 7

This result follows from the text and structure of the section 1 exemption.

Again, the Supreme Court has instructed that the residual clause should “be controlled

and defined by reference to the enumerated categories of workers which are recited just

before it[.]” Circuit City, 532 U.S. at 115. And the enumerated categories of “seamen”

and “railroad employees” contain no geographic limitations. Thus, the most natural

inference is that Congress intended those terms to encompass all seamen and railroad

employees nationwide.

This means that the “other class of workers” category that is specified in

section 1 must also be given a nationwide scope rather than being limited to workers of

7 The Court reaches this conclusion notwithstanding the lack of clarity in Osvatics’s complaint concerning the precise contours of Osvatics’s proposed class of “D.C. Lyft drivers.” The identified cohort might be coextensive with the putative class in Osvatics’s complaint, i.e., “all drivers who work or worked for Lyft in the District of Columbia for at least 90 days between when Lyft began operating in the District of Columbia and the date of final judgment in this matter[.]” (Compl. ¶ 79.) Or it might include all Lyft drivers licensed to pick up passengers within Lyft’s designated service area for the D.C. metropolitan area. (See id. ¶¶ 52, 56.) And, indeed, the confusion regarding who qualifies as a “D.C. Lyft driver” for section 1 purposes merely highlights the potential administrability problems with assessing the relevant class of workers at anything other than a nationwide level.

21 that type within a particular state, metropolitan area, or city. Consistent with this

analysis, several other courts have rejected attempts to limit the relevant class to

workers within a particular geographic area. See Islam, 2021 WL 871417, at *7 (noting

that “the statute exempts from the FAA ‘seamen’ and ‘railroad employees’ at a high

level of generality, irrespective of their locations or their specific employers,” and

explaining that “any other ‘class of workers’ should be defined in an equally broad

fashion”); see also, e.g., Aleksanian, 2021 WL 860127, at *7 (rebuffing plaintiff’s

attempt to “frame the class of workers as ‘New York City Uber drivers’” because

“[t]here is no basis for defining the class so narrowly”). And while a few courts have

apparently assumed that the relevant “class of workers” is limited to workers within a

particular state, see, e.g., Cunningham, 450 F. Supp. 3d at 46 (noting that Lyft drivers

in Massachusetts “enabl[e] their passengers to leave or enter Massachusetts”); Capriole,

460 F. Supp. 3d at 932 (observing that “interstate rides given by Uber drivers in

Massachusetts [are] not only incidental—they are rare”), those courts did not

specifically analyze the appropriate geographic scope of a “class of workers” for

section 1 purposes.

It is also clear to this Court that defining the relevant class of workers as limited

to a particular geographic area would undermine the underlying purposes of the FAA.

In enacting the FAA, Congress sought to create a “national policy favoring

arbitration[,]” Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 443 (2006)

(emphasis added), and it thus seems unlikely that Congress would have wanted the

applicability of the section 1 exemption—and thus the enforceability of a given

arbitration agreement—to vary by geographical region. See Islam, 2021 WL 871417, at

22 *7 (“[I]t would be illogical if Lyft drivers performing the same work for the same

company in different cities were to have completely different rights and obligations

under the FAA merely because of a happenstance of geography[.]” (internal quotation

marks and citation omitted)); Sienkaniec, 401 F. Supp. 3d at 872 (observing that

“[t]here is a strong argument that the ‘class of workers’ to which [plaintiff] belongs is

‘all Uber drivers in the United States’” because all “Uber drivers perform the same job

for the same company pursuant to the same agreement”); cf. Southland Corp. v.

Keating, 465 U.S. 1, 15 (1984) (rejecting interpretation of the FAA under which the

“right to enforce an arbitration contract” would be “dependent for its enforcement on

the particular forum in which it is asserted”). Similarly, if the scope of the relevant

class of workers depended on the plaintiff’s allegations or proposed class definition,

parties would not be able to determine whether their arbitration agreement is

enforceable under the FAA until a lawsuit between the parties is filed and a party seeks

to enforce the arbitration agreement. That result would no doubt “undermine[] both the

certainty and predictability which arbitration agreements are meant to foster.” See

Menorah Ins. Co. v. INX Reinsurance Corp., 72 F.3d 218, 223 (1st Cir. 1995).

For all these reasons, with respect to the instant lawsuit, this Court rejects

Osvatics’s attempt to define the applicable “class of workers” for section 1 purposes as

“D.C. Lyft drivers[.]” (See Pl.’s Opp’n at 29.) To the contrary, in this Court’s view,

the relevant class of workers must be Lyft drivers or rideshare drivers nationwide, as

that is the only approach consistent with the FAA’s text and purpose. 8

8 One challenging side question that no court seems to have grappled with to date is whether the relevant class of workers is Lyft drivers nationwide or rideshare drivers more generally. On one hand, the enumerated categories of “seamen” and “railroad employees” appear to contemplate an industry- wide classification rather than a company-by-company determination. See 9 U.S.C. § 1. On the other

23 3. Lyft Drivers As A Class Are Not Engaged In Interstate Commerce

Finally, with respect to the ultimate question of the applicability of the section 1

exemption, this Court concludes that Lyft drivers are not “engaged in . . . interstate

commerce” within the meaning of section 1 of the FAA. See 9 U.S.C. § 1.

The Court’s analysis begins with an interpretation of the relevant language of

section 1. Again, that provision specifies that the FAA does not “apply to contracts of

employment of seamen, railroad employees, or any other class of workers engaged in

foreign or interstate commerce.” 9 U.S.C. § 1 (emphasis added). The Supreme Court

has emphasized that, because the FAA “‘seeks broadly to overcome judicial hostility to

arbitration agreements,’” the section 1 exemption should “be afforded a narrow

construction.” Circuit City, 532 U.S. at 118 (quoting Allied-Bruce Terminix Cos. v.

Dobson, 513 U.S. 265, 272 (1995)). In particular, while the words “involving

commerce” in section 2 of the FAA “implement[] Congress’ intent to exercise [its own]

commerce power to the full[,]” id. at 112 (internal quotation marks and citation

omitted), “[t]he plain meaning of the words ‘engaged in commerce’” in section 1 “is

narrower than the more open-ended formulations ‘affecting commerce’ and ‘involving

commerce[,]’” id. at 118 (emphasis added), and reaches “‘only persons or activities

within the flow of interstate commerce[,]’” id. (quoting Gulf Oil Corp. v. Copp Paving

Co., 419 U.S. 186, 195 (1974)). Moreover, because the residual clause is “controlled

and defined by reference to the enumerated categories of workers which are recited just

hand, there may be variations among rideshare services that are potentially material to the section 1 analysis. Cf. Rogers, 452 F. Supp. 3d at 916 (suggesting that Lyft drivers may be exempt under section 1 if “Lyft’s focus were the service of transporting people to and from airports”). But the parties here have not argued that Lyft drivers are meaningfully different than drivers for other rideshare services such as Uber; therefore, this Court need not resolve this issue. And for simplicity’s sake, the Court has opted to refer to the relevant class of workers as “Lyft drivers” throughout this Memorandum Opinion.

24 before it[,]” id. at 115, the Supreme Court has held that the section 1 exemption does

not encompass “all employment contracts”; instead, it “exempts from the FAA only

contracts of employment of transportation workers[,]” id. at 119 (emphasis added).

Additional principles bearing on the section 1 analysis can be gleaned from

lower-court decisions that have interpreted and applied the residual clause. First, given

that the statute speaks in terms of a “class of workers[,]” 9 U.S.C. § 1, the pertinent

inquiry is “not whether the individual worker actually engaged in interstate commerce,

but whether the class of workers to which the complaining worker belonged engaged in

interstate commerce[,]” Bacashihua v. U.S. Postal Serv., 859 F.2d 402, 405 (6th Cir.

1988) (emphases added); cf. Int’l Bhd. of Teamsters Loc. Union No. 50 v. Kienstra

Precast, LLC, 702 F.3d 954, 957 (7th Cir. 2012) (holding that truck drivers for

particular company were “interstate transportation workers within the meaning of § 1 of

the FAA” even though they only “occasionally transported loads into” a neighboring

state).

Second, by its plain terms, the section 1 residual clause only encompasses

classes of workers that are “engaged in foreign or interstate commerce.” 9 U.S.C. § 1.

And whether a worker is “engaged in . . . interstate commerce” turns on whether

“interstate movement” is “a central part of the class members’ job description.”

Wallace v. Grubhub Holdings, Inc., 970 F.3d 798, 801 (7th Cir. 2020). Thus, to fall

within the scope of the residual clause, the class of workers must “perform[] work

analogous to that of seamen and railroad employees, whose occupations are centered on

the transport of goods [or persons] in interstate or foreign commerce.” Id. at 802; see

also Eastus v. ISS Facility Servs., Inc., 960 F.3d 207, 210 (5th Cir. 2020) (examining

25 whether a class of workers was “engage[d] in the movement of goods in interstate

commerce in the same way that seamen and railroad workers are” (internal quotation

marks and citation omitted)). Put slightly differently, “a class of workers must

themselves be ‘engaged in the channels of foreign or interstate commerce’” to qualify

for the section 1 exemption. Wallace, 970 F.3d at 802 (quoting McWilliams v. Logicon,

Inc., 143 F.3d 573, 576 (10th Cir. 1998)); see also Rittmann, 971 F.3d at 917 (holding

that a class of workers is “engaged in interstate commerce” if those workers “form a

part of the channels of interstate commerce”); Waithaka, 966 F.3d at 23 (explaining that

courts should “assess whether workers’ activities include the transportation of goods or

people in the flow of interstate commerce”).

Third, and relatedly, the applicability of the section 1 residual clause does not

depend on whether the class of workers physically crosses state lines. See Waithaka,

966 F.3d at 25 (observing that “crossing state lines” is not “the touchstone of the

exemption’s test”). Crossing state lines is not a necessary condition because, for

instance, “workers moving goods or people destined for, or coming from, other states”

may be “engaged in interstate commerce[,]” even if the workers are “responsible only

for an intrastate leg of that interstate journey[.]” Id. at 22; Rittmann, 971 F.3d at 915

(concluding that section 1 “exempts transportation workers who are engaged in the

movement of goods in interstate commerce, even if they do not cross state lines”).

Conversely, physically crossing state lines also is not sufficient to trigger the section 1

exemption; the residual clause does not cover “workers who incidentally transport[]

goods interstate[,]” such as “a pizza delivery person who delivered pizza across a state

line to a customer in a neighboring town.” Hill v. Rent-A-Ctr., Inc., 398 F.3d 1286,

26 1289–90 (11th Cir. 2005); see also Wallace, 970 F.3d at 800 (“[S]omeone whose

occupation is not defined by its engagement in interstate commerce does not qualify for

the exemption just because she occasionally performs that kind of work.”). All told,

then, the “critical factor” underlying the applicability of the section 1 exemption is

“[t]he nature of the business for which a class of workers perform[s] their activities”

rather than whether the workers actually “cross[] state lines[.]” See Grice, 974 F.3d at

956 (internal quotation marks and citation omitted).

Applying these principles, this Court concludes that Lyft drivers as a class are

not “engaged in . . . interstate commerce” within the meaning of section 1. Unlike

seamen and railroad workers, for whom the interstate movement of goods and

passengers over long distances and across state lines is “a central part of the job

description[,]” Wallace, 970 F.3d at 803, Lyft drivers offer services that are primarily

local and intrastate in nature, see Rogers, 452 F. Supp. 3d at 916 (“Their work

predominantly entails intrastate trips, an activity that undoubtedly affects interstate

commerce but is not interstate commerce itself.”). In other words, Lyft drivers are “in

the general business of giving people rides, not the particular business of offering

interstate transportation to passengers.” Id.; see also Capriole, 460 F. Supp. 3d at 932

(“Uber drivers do not perform an integral role in a chain of interstate transportation.”);

Aleksanian, 2021 WL 860127, at *8 (explaining that “interstate movement of people” is

not “a central part of the job description of the class of workers to which” rideshare

drivers belong). Thus, any “[i]nterstate trips” that Lyft drivers take “by happenstance

27 of geography do not alter the intrastate transportation function performed by the class

of workers.” Rogers, 452 F. Supp. 3d at 916. 9

Nor is the fact that Lyft drivers frequently transport passengers to and from

airports and train stations (before or after those passengers have themselves traveled

interstate) determinative of the interstate commerce inquiry, as Osvatics maintains.

(See Pl.’s Opp’n at 26 & n.10; see also Compl. ¶¶ 58–68.) The Supreme Court has

explained that statutory language such as “in commerce” encompasses “only persons or

activities within the flow of interstate commerce[,]” which in turn requires some

“practical, economic continuity in the generation of goods and services for interstate

markets and their transport and distribution to the consumer.” Gulf Oil, 419 U.S. at

195.

For instance, in United States v. Yellow Cab Co., 332 U.S. 218 (1947), overruled

on other grounds by Copperweld Corp. v. Indep. Tube Corp., 467 U.S. 752 (1984), the

Supreme Court assessed whether various alleged conspiracies involving taxicab

companies constituted restraints on interstate commerce in violation of antitrust laws.

See id. at 225. One such conspiracy involved an agreement not to compete “for

contracts with railroads or railroad terminal associations to transport passengers and

their luggage between railroad stations in Chicago.” Id. at 228. The Supreme Court

held that this alleged antitrust violation did involve “the stream of interstate commerce”

because these taxicab rides constituted “an integral step in the interstate movement[,]”

due in large part to the contractual nature of the arrangement between the taxicab

9 Of course, this means that even if the relevant class of workers were limited to D.C. Lyft drivers, as Osvatics contends (see Pl.’s Opp’n at 29), the Court would still be compelled to conclude that the frequency with which that class allegedly crosses state lines (see Compl. ¶¶ 49–57) is irrelevant to the determination of whether it is exempt under section 1.

28 companies and the railroads. Id. at 228–29. And, notably, this circumstance stood in

contrast to another alleged antitrust violation, which had involved a conspiracy to limit

the total number of licensed taxicabs in Chicago overall. See id. at 230. The Supreme

Court acknowledged that taxicabs often transport people to and from railroad stations,

but held that “such transportation is too unrelated to interstate commerce to constitute a

part thereof within the meaning of” the antitrust statute. See id. Furthermore, the

Justices in the majority found it particularly significant that these taxicabs had “no

contractual or other arrangement with the interstate railroads[,]” and that this taxicab

service was “contracted for independently of the railroad journey[.]” Id. at 231–32.

“[W]hen local taxicabs merely convey interstate train passengers between their homes

and the railroad station in the normal course of their independent local service,” the

Supreme Court concluded, “that service is not an integral part of interstate

transportation.” Id. at 233. 10

This reasoning compels the conclusion that the fact that Lyft drivers occasionally

and incidentally transport passengers to and from airports and railroad stations does not

mean that such drivers are engaged in interstate commerce for purposes of section 1 of

the FAA. See Rogers, 452 F. Supp. 3d at 916–17 (summarizing Yellow Cab and

concluding that the same analysis applies to “these modern-day taxi drivers”). And this

is especially so given the apparently undisputed fact in the instant case that passengers

seeking a ride to or from an airport or railroad station use the Lyft application

10 The Supreme Court in Yellow Cab was interpreting the Sherman Act, which contains different language regarding commerce than section 1 of the FAA. See 15 U.S.C. § 1 (prohibiting certain agreements “in restraint of trade or commerce”); id. § 2 (prohibiting monopolization of “any part of the trade or commerce among the several States”). However, if anything, the phrase “engaged in commerce” as used in section 1 of the FAA is “narrower” than formulations such as “affecting commerce[,]” see Circuit City, 532 U.S. at 118, and the language of the Sherman Act is similar to this latter category, see Yellow Cab, 332 U.S. at 225.

29 unilaterally to hail a driver, and there is no evidence that Lyft has a “contractual or

other arrangement” with airlines or railways for Lyft drivers to transport passengers

who have taken trips with those companies. Yellow Cab, 332 U.S. at 231. This makes

“Lyft drivers’ ‘relationship to interstate transit . . . only casual and incidental[,]’”

Rogers, 452 F. Supp. 3d at 917 (quoting Yellow Cab, 332 U.S. at 231), which means

that Lyft drivers “lack the requisite ‘practical, economic continuity’ with interstate air

or rail transportation” to qualify as engaging in interstate commerce within the meaning

of section 1, id. (quoting Gulf Oil, 419 U.S. at 195); see also Aleksanian, 2021 WL

860127, at *8 (explaining that Yellow Cab’s “reasoning is just as applicable” to

rideshare drivers); Hinson, 2021 WL 838411, at *6 (analogizing Lyft drivers to taxi

drivers, who “have been found to have an ‘only casual and incidental’ relationship to

interstate transit” (quoting Capriole, 460 F. Supp. 3d at 932)).

In this Court’s view, the three district court decisions that have rejected the

analysis of Rogers and Hinson, and have thus held that rideshare drivers are exempt

from the FAA under section 1, see Cunningham, 450 F. Supp. 3d at 47; Islam, 2021 WL

871417, at *12; Haider, 2021 WL 1226442, at *4, are not persuasive. Starting with

Cunningham, the court in that case reached its conclusion in reliance on the so-called

“Lenz factors,” which are a non-exhaustive list of factors created by the Eighth Circuit

to be considered “in determining whether [a] contract involves a worker engaged in

interstate commerce.” Cunningham, 450 F. Supp. 3d at 46 (citing Lenz v. Yellow

Transp., Inc., 431 F.3d 348, 351–52 (8th Cir. 2005)). 11 But Lenz itself involved a

11 Those factors are (1) “whether the employee works in the transportation industry”; (2) “whether the employee is directly responsible for transporting the goods in interstate commerce”; (3) “whether the employee handles goods that travel interstate”; (4) “whether the employee supervises employees who are themselves transportation workers, such as truck drivers”; (5) “whether, like seamen or railroad

30 customer-service representative for a trucking company, and the Eighth Circuit made

clear that the factors it set out were to be used “in determining whether [such] an

employee [of a transportation company] is so closely related to interstate commerce that

he or she fits within the § 1 exemption of the FAA[.]” See Lenz, 431 F.3d at 352.

Consequently, to the extent that the Lenz factors are instructive at all, they are relevant

only after a “class of workers engaged in . . . interstate commerce” has been

established, and when the court is called upon to assess whether “a worker one step

removed from the actual physical delivery of goods” belongs to that class. See

Kowalewski, 590 F. Supp. 2d at 482 n.3; see also Rogers, 452 F. Supp. 3d at 917 n.3

(declining to consider the Lenz factors in determining whether Lyft drivers are a class

of workers engaged in interstate commerce); cf. Eastus, 960 F.3d at 211 (declining to

adopt the Lenz factors even to assess the question for which they were designed because

“[n]o other circuit has adopted this test” and “it unduly adds to the complexity of the

analysis”). 12

Similarly, this Court disagrees with Islam’s and Haider’s analyses of section 1’s

application to Lyft drivers. The court in Islam noted that “[r]idesharing platforms

employees, the employee is within a class of employees for which special arbitration already existed when Congress enacted the FAA”; (6) “whether the vehicle itself is vital to the commercial enterprise of the employer”; (7) “whether a strike by the employee would disrupt interstate commerce”; and (8) “the nexus that exists between the employee’s job duties and the vehicle the employee uses in carrying out his duties (i.e., a truck driver whose only job is to deliver goods cannot perform his job without a truck).” Lenz, 431 F.3d at 352. 12 Even apart from its analytical framework, Cunningham mistakenly characterized the “critical question” as whether rideshare drivers “transport passengers that travel interstate[,]” and thus found it particularly significant that Lyft drivers transport passengers to and from airports. See Cunningham, 450 F. Supp. 3d at 46. Thus, it reasoned that “Lyft drivers are part of the chain of interstate commerce, enabling their passengers to” travel interstate, id., when, as explained above, merely carrying passengers to and from airports is insufficient to be “engaged in” interstate commerce for purposes of the section 1 exemption, see Rogers, 452 F. Supp. 3d at 917 (internal quotation marks and citation omitted).

31 provide hundreds of millions of rides in the United States each year[,]” including “tens

of millions of interstate rides[,]” and reasoned that “an individual driver can still expect

to cross state lines with some frequency” even if “interstate transportation is not the

predominant daily service provided by rideshare drivers[.]” Islam, 2021 WL 871417, at

*8; see also Haider, 2021 WL 1226442, at *3 (“[T]he sheer number of interstate trips

rideshare drivers make places them within the flow of interstate commerce.” (internal

quotation marks and citation omitted)). But the applicability of the section 1 residual

clause does not depend on the aggregate number or frequency of interstate trips taken

by a class of workers; instead, what is at issue is whether that class of workers is

“engaged in the channels of . . . interstate commerce[,]” meaning that interstate

transportation is “a central part of the class members’ job description” on par with

seamen and railroad employees. See Wallace, 970 F.3d at 801–02 (internal quotation

marks and citation omitted). As previously explained, Lyft drivers’ interstate rides, no

matter how numerous, are merely “incidental” to their local transportation function, see

Hill, 398 F.3d at 1289, and this is so notwithstanding “the fact that the nationwide class

of rideshare drivers frequently transports passengers to airports, train stations, and other

hubs of interstate travel[,]” Islam, 2021 WL 871417, at *9; see also Haider, 2021 WL

1226442, at *4 (same). Simply stated, the mere transport of passengers to and from

hubs of interstate travel, however frequently that may occur, is not enough; instead, to

be a class of workers that qualifies for the section 1 exemption, there must be an

established link between such intrastate rideshare trips and the channels of commerce

that are designed to facilitate passengers’ interstate journeys. See Rogers, 452 F. Supp.

3d at 917; Yellow Cab, 332 U.S. at 230–33.

32 Finally, this Court’s conclusion that Lyft drivers do not fall within the section 1

exemption is also consistent with Waithaka and Rittmann, in which the First and Ninth

Circuits held that Amazon’s “AmFlex” delivery drivers, who locally deliver Amazon

packages on the final legs of their interstate journeys, are exempt from the FAA under

the section 1 residual clause. See Waithaka, 966 F.3d at 13–14; Rittmann, 971 F.3d at

907. As the Ninth Circuit recognized in Grice, those holdings were based on both “the

interstate nature of Amazon’s business” and the fact that Amazon specifically hires

AmFlex workers to “complete the delivery of goods that Amazon ships across state

lines[,]” circumstances that are not present in the case of rideshare drivers. Grice, 974

F.3d at 957–58 & n.5 (internal quotation marks and citation omitted).

In short, consistent with the persuasive holdings of Rogers, Hinson, and

Aleksanian, among other decisions, this Court comfortably concludes that Lyft drivers

are not “engaged in . . . interstate commerce” within the meaning of section 1 of the

FAA, and, thus, Osvatics’s arbitration agreement with Lyft is not exempt from the FAA

and its enforcement mechanisms.

C. Osvatics Has Not Demonstrated That Discovery Is Warranted

This Court also rejects Osvatics’s assertion that additional discovery is necessary

before any conclusion can be reached concerning the applicability of the section 1

exemption to Lyft drivers. Osvatics requests information such as the number of Lyft

drivers both nationwide and in the D.C. metropolitan area who have transported a

passenger across state lines, as well as the number of Lyft trips that originate in the

D.C. metropolitan area and cross state lines. (See Pl.’s Opp’n at 47–48 (citing

Sienkaniec, 401 F. Supp. 3d at 872–73).) She also seeks “discovery targeted to the

importance of interstate travel to Lyft’s business in the D.C. area, including its

33 marketing of airport travel[,]” and further discovery regarding Lyft’s representation that

less than 2% of Lyft rides nationwide cross state lines. (See id. at 48 (citing Decl. of

Ian Muir in Supp. of Def.’s Mot., ECF No. 6-4, ¶ 5).) But the Court has not relied on

data regarding the proportion of Lyft trips that involve crossing state lines to reach its

conclusions about the applicability of section 1, and it is highly unlikely that the other

information Osvatics seeks would affect this Court’s analysis.

That is, based on known facts, Osvatics does not seriously dispute that trips

provided by Lyft drivers are primarily local in nature, and there is nothing in the

existing record that suggests that further discovery into any precise statistics regarding

interstate Lyft rides would alter or impact that characterization. See, e.g., Aleksanian,

2021 WL 860127, at *5 (declining to grant discovery with respect to “information on

interstate trips and trips to airports/transportation hubs” and suggesting that such

information is not “relevant to deciding the issue of whether Plaintiffs belong to a class

of workers ‘engaged in interstate commerce’”); cf. Wolff v. Westwood Mgmt., LLC, 558

F.3d 517, 521 (D.C. Cir. 2009) (holding that district court did not abuse its discretion in

denying discovery because the requesting parties “failed to demonstrate” how the

requested discovery “would have assisted them in opposing the motion to compel

arbitration”). Thus, the Court concludes that the information that Osvatics hopes to

discover is not relevant to the task at hand.

IV. CONCLUSION

A court faced with a motion to compel arbitration must determine “(1) whether

the parties entered into a binding and enforceable arbitration agreement; and if so,

(2) whether the arbitration agreement encompasses the claims that [the] plaintiff raised

34 in her complaint.” Sapiro v. VeriSign, 310 F. Supp. 2d 208, 212 (D.D.C. 2004). Only

the first question is at issue here, and this Court has answered in the affirmative, given

that Osvatics and Lyft formed a valid arbitration agreement, and that agreement is

enforceable under the FAA because it is not exempt under section 1. 13

Accordingly, in its Order issued on March 31, 2021, this Court GRANTED

Lyft’s motion to compel individual arbitration and stay proceedings pending arbitration

pursuant to its authority under the FAA. See 9 U.S.C. §§ 3–4; see also Dean Witter

Reynolds, Inc. v. Byrd, 470 U.S. 213, 218 (1985) (explaining that the FAA “leaves no

place for the exercise of discretion by a district court, but instead mandates that district

courts shall direct the parties to proceed to arbitration on issues as to which an

arbitration agreement has been signed”).

DATE: April 22, 2021 Ketanji Brown Jackson KETANJI BROWN JACKSON United States District Judge

13 As to the second question, while Osvatics has not disputed that the arbitration agreement covers the claim that she asserts in the instant litigation, Lyft’s Terms of Service leave the scope of the arbitration agreement as a matter for the arbitrator, rather than this Court, to decide. (See 2019 Terms of Service at 14.) See also Rent-A-Ctr., 561 U.S. at 68–69 (observing that “parties can agree to arbitrate gateway questions of arbitrability, such as whether the parties have agreed to arbitrate or whether their agreement covers a particular controversy” (internal quotation marks and citations omitted)).