Court Deals Setback to Uber Drivers in Background Check Lawsuit

FILE - In this July 15, 2015 file photo, an Uber driver sits in his car near the San Francisco International Airport. Uber and advocates for the blind have reached a lawsuit settlement in which the ride-hailing company agrees to require that existing and new drivers confirm they understand their legal obligations to transport riders with guide dogs or other service animals. The settlement is designed to resolve a lawsuit in federal court that alleges Uber discriminates against passengers with service dogs. (AP Photo/Jeff Chiu, File)

Jeff Chiu — AP

A U.S. appeals court on Wednesday said most of a lawsuit challenging background checks performed by Uber (UBER) on its drivers should proceed to arbitration.

The 9th U.S. Circuit Court of Appeals in San Francisco said agreements signed by the two Uber drivers who filed the proposed class action lawsuit “clearly and unmistakably” required a private arbitrator, and not a federal judge, to decide whether the claims should be kept out of court.

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The 2013 lawsuit says Uber violated a federal law and various California laws when it barred the plaintiffs from signing into the service because of issues with their consumer credit reports.

Wednesday’s decision partially reversed a 2015 ruling by a federal judge who said that even if the agreements were clear, they were unfair to the drivers.