New York High Court Enforces Uber’s Arbitration Clause Despite Preexisting Injury Lawsuit

In a closely watched decision, New York’s Court of Appeals upheld Uber’s clickwrap agreement, requiring arbitration in disputes, including preexisting injury claims. The case arose from a personal injury lawsuit filed by Emily Wu, who was struck by a vehicle after exiting an Uber car in Brooklyn. Wu argued that Uber’s updated terms of use, sent after her lawsuit was filed, were misleading and did not apply to her pending legal claim.

The court ruled in a 5-2 decision that Uber’s arbitration agreement was valid and enforceable, delegating disputes about its applicability to arbitration. Judges emphasized that under traditional contract law, Wu was on "inquiry notice" of the agreement’s terms when she accepted the updated terms via the Uber app. The court acknowledged that web-based contracts should be treated no differently than written agreements, even if consumers fail to review the terms before acceptance.

The dissenting opinion, authored by Judge Jenny Rivera, argued that applying the arbitration clause to a previously filed lawsuit was unreasonable and lacked a clear ‘meeting of the minds.’ Rivera contended that Wu had no actual or inquiry notice of terms affecting her already-pending case, which invalidated that aspect of the contract. Despite the dissent, the decision aligns New York with other jurisdictions affirming the enforceability of web-based arbitration agreements.