The US Court of Appeals for the Ninth Circuit is scheduled Thursday to hear Amazon’s appeal of a California federal judge’s decision declining to push Drickey Jackson’s proposed class action out of court and into individual arbitration. The arbitration agreement Jackson signed didn’t cover his privacy claims, the judge ruled.
Jackson accused Amazon of snooping on conversations in private Facebook groups that include about 800 for drivers for Amazon Flex, the company’s gig-style program that lets drivers use their own vehicles to deliver packages. He brought class claims under both California privacy law and federal wiretapping law.
The Ninth Circuit ruling will likely determine whether Amazon can nip in the bud a proposed nationwide class action by requiring that Jackson arbitrate his individual privacy claims.
The case also could clarify—or create a vehicle for the US Supreme Court to consider—issues about the transportation-worker exception to the federal law that’s used to enforce arbitration contracts. That includes whether companies can appeal a district court’s decision denying a bid to push a transportation worker’s lawsuit into arbitration.
The Federal Arbitration Act doesn’t apply to transportation workers involved in interstate commerce, even if they’re independent contractors, the Supreme Court held in its 2019 decision in New Prime, Inc. v. Oliveira. That ruling sparked litigation across the country about which types of workers should fall under that category.
Applying New Prime, the Ninth Circuit found in its 2020 decision in Rittman v. Amazon.com, Inc. that Amazon Flex delivery drivers qualified for the exemption even though they don’t cross state lines to make deliveries. Those drivers make “last mile” deliveries of products that are in the stream of interstate commerce, the circuit court held.
The Supreme Court in June waded into the issue of who qualifies as a transportation worker, holding in Southwest Airlines Co. v. Saxon that the FAA exemption covers airplane cargo loaders. But that relatively narrow decision left circuits split on how to handle delivery drivers.
“Saxon left out what to do with last-mile drivers,” said Sarah Rudolph Cole, a law professor at the Ohio State University Moritz College of Law and director of the school’s Program on Dispute Resolution. “That’s a big, gaping hole in the decision.”
If Amazon fails to move Jackson’s lawsuit into arbitration, the company will probably challenge the Ninth Circuit’s decision at the Supreme Court, Cole said.
Amazon’s appeal will be heard by a Ninth Circuit panel made up of Judges
Jackson contends that the panel doesn’t have jurisdiction to hear the company’s challenge to the 2021 decision from US District Jude William Hayes.
Hayes, a George W. Bush appointee, agreed with Jackson that a 2016 arbitration agreement should govern the case, holding that Amazon didn’t show that Jackson assented to a separate pact in 2019. That later agreement would require Jackson to arbitrate issues related to the arbitrability of his claims.
Because Jackson fell within the FAA’s transportation worker exemption, Hayes analyzed the 2016 agreement under California law and determined Jackson’s privacy claims weren’t covered by the agreement. Those allegations don’t stem from his employment relationship with Amazon, the judge said.
The FAA allows parties to appeal decisions denying motions to compel arbitration, which otherwise are non-final rulings that couldn’t be challenged immediately, absent special circumstances.
But because Hayes relied on California law when deciding to keep the case out of arbitration, the FAA’s special appeal provisions don’t apply, Jackson told the Ninth Circuit in a brief.
The Ninth Circuit reached a similar conclusion in 2017, as have the First, Seventh, and Eleventh circuits in analogous decisions, Jackson said.
Amazon, however, argued in a brief that the Ninth Circuit’s jurisdiction doesn’t turn on whether the company is entitled to arbitration under the FAA.
“What matters is that Amazon invoked the FAA and the district court denied the motion,” the company said. “That secures appellate jurisdiction, as this Court’s own cases attest.”
Moreover, the Ninth Circuit ruled in 1985 that a denial of a motion to compel arbitration is immediately appealable, under a section of the US Code separate from the FAA, Amazon said.
On the merits, Amazon challenged the district judge’s determination that the 2016 agreement applied, arguing that Jackson received sufficient notice of the 2019 contract.
The company also contended that, regardless of which arbitration agreement applies, Jackson’s privacy claims clearly arise from his work for Amazon Flex and are covered by the pact.
Jackson’s attorney, Max Roberts of Bursor & Fisher PA, declined to comment. Amazon’s lawyer, Michael Kenneally of Morgan Lewis & Bockius LLP, didn’t respond to requests for comment.
The case is Jackson v. Amazon.com, Inc., 9th Cir., No. 21-56107, oral argument 11/17/22.