On September 20, the Superior Court of New Jersey, Appellate Division, reversed a lower court's decision by upholding the enforceability of Uber Technologies, Inc.'s arbitration agreement.
The ruling compels arbitration in the case of Georgia M. McGinty and John Francis McGinty v. Uber Technologies, Inc., reinforcing the validity of arbitration clauses and supporting businesses against unjust lawsuits.
"The arbitration provision contained in the agreement under review... is valid and enforceable," the appellate court stated in its ruling. "The arbitrator will therefore decide if John is subject to arbitration as a third-party beneficiary," the court continued, referencing the agreement's comprehensive scope.
The decision underscores New Jersey's strong policy favoring arbitration as a mechanism for resolving disputes, aligning with federal law and promoting efficient legal processes.
Court documents show a trial court decision had originally denied Uber’s motion to compel arbitration in a personal injury lawsuit filed by Georgia McGinty and her husband following a car accident involving an Uber driver. The appellate court ruled that the arbitration agreement in Uber’s terms of service, which Georgia had agreed to, was valid and enforceable, reversing the lower court’s decision and ordering the case to proceed to arbitration.
A report by the American Tort Reform Association (ATRA) revealed that New Jersey lawyers spent $105.3 million on legal services advertisements in 2023. These often encourage litigation against large companies like Uber.
According to ATRA President Sherman “Tiger” Joyce, "aggressive" advertising campaigns are used to solicit clients, leading to an increase in settlements and payouts that strain businesses and consumers alike. New Jersey residents, he noted, bear an additional cost of approximately $1,757 annually due to such lawsuits.