Column: How sleazy is Uber? This federal judge wants to know
We’re familiar with the Uber that talked about responding to bad publicity by digging up dirt on reporters following the company. Also the Uber that allegedly stalked passengers using its service, following their travel routes for the amusement of its party-goers. And the Uber that moves heaven and earth to avoid performing thorough background checks on its drivers.
What about the Uber that secretly investigated a lawyer representing an adversary in a lawsuit, and then lied about it? That’s the Uber that Federal Judge Jed S. Rakoff of New York wants to hear a lot more about. On Thursday he ordered Uber to turn over to the other side a pile of documents related to the investigation. Uber’s activities, he ruled, raise “a serious risk of perverting the processes of justice before this court.†We’ve asked Uber for comment, but haven’t heard back.
Rakoff is presiding over an antitrust lawsuit brought by an Uber customer alleging price-fixing by the company’s co-founder and CEO, Travis Kalanick, in collusion with Uber drivers. After the case was filed, a lawyer for plaintiff Spencer Meyer discovered that someone was snooping around, asking questions about him. The snooper explained his interest in the lawyer by saying he was merely “compiling a profile of up-and-coming labor lawyers in the United States,†Rakoff related.
[Uber’s behavior raises] a serious risk of perverting the processes of justice before this court.
— U.S. District Judge Jed S. Rakoff
When the plaintiff’s lawyers asked Kalanick’s attorneys about this, they replied, “Whoever is behind these calls, it is not us.â€
As it turns out, it was them. Uber confessed in February that it had hired the security firm Ergo to investigate Mayer and his lawyers. In fact, Meyer’s lawyers say Ergo’s investigative report was circulating in Uber’s offices and may have been in the hands of the company’s general counsel, Salle Yoo, on January 20, the very day the company’s lawyers were saying “it is not us.â€
Rakoff, who is known as the quintessential no-nonsense judge, is predictably indignant about all this. On Thursday he ordered documents related to Uber’s employment of Ergo turned over to Meyer’s lawyers so they can begin taking depositions from five Uber and Ergo employees and executives. In doing so he rejected Uber’s assertion that the documents were protected by attorney-client privilege.
That was a dubious claim from the start, Rakoff noted; Uber originally claimed that it hired Ergo because it had reason to fear that the lawsuit, which named Kalanick personally, “posed a safety issue for Mr. Kalanick.†The judge observed, “Uber communications regarding… Kalanick’s safety do not involve legal advice and so are not shielded by the attorney-client privilege.â€
In any event, Ergo’s own lawyers admitted in Rakoff’s courtroom that the firm had been hired “for the purpose of gathering intelligence… about the motivations of this particular plaintiff and why he was bringing this particular litigation.†Evidence that an Ergo employee misrepresented himself during his investigation, Rakoff found, “provides a reasonable… basis to suspect that a fraud occurred and that Uber’s communications may have been in furtherance of it.†Fraud is another exception to attorney-client protection.
Ergo, for its part, presents itself as a high-class security outfit. Its CEO, R.P. Eddy, is a former White House national security official, and among its managing partners is former CIA official Todd Egeland. Its advisory board bristles with prominent names, including former Israeli Prime Minister Ehud Barak and former New Mexico Gov. Bill Richardson.
But the court record suggests that it’s not above throwing an operative under the bus. Both Uber and Ergo have insisted that no one was authorized to make any misrepresentations in the course of the investigation and, as Rakoff related, “any such misrepresentations were the fault… of a misguided Ergo employee.†(We know all about this “misguided†employee, and so do you. He’s a first cousin of the “disgruntled†or “rogue†employee who’s usually blamed when a company gets caught doing something indefensible.)
The lying about Ergo’s contract, however, was all on Uber’s side, and put Rakoff on the alert. When Uber tried to head off disclosure of its documents by assuring the judge that it had no clue about the Ergo employee’s misrepresentations, Rakoff shot back that its own earlier untruths “underscore why the fact-finding process cannot merely be replaced by Uber’s representation.â€
Uber has been accustomed to getting its way by badgering and blustering. As anyone who has practiced before Rakoff could have told the company, that doesn’t work in his house. He’s become very curious about what Uber has been up to, and he’s likely to find out.
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