Significance of the Uber’s Price Fixing Problem

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Name: Course: Instructor; Date: Significance of the Uber’s Price Fixing Problem Just recently after settling one lawsuit, Uber and its CEO Travis Kalanick face an antitrust class action lawsuit. The suit is filed by Spencer Meyer who alleges that Uber is engaged in a price-fixing conspiracy against the Sherman Antitrust Act which protects customers from corrupt collusion. Spencer’s argument is that since Uber claims that its drivers are independent contractors, then they should not conspire secretly over how much they should charge their consumers, and since they are doing so, then it amounts to price fixing since the app enables all the independent drivers to have identical prices. The suit has a number of implications. If the suit was to go against Uber, the company stands to pay millions of dollars in penalties. According to Steinbaum (1), the firm reached a settlement provision of $100 million with its drivers in Massachusetts and California in April 2016. This is an indication that Uber could be faced with penalties or even higher fees in terms of settlement provisions if the suit was to turn out in Spencer’s favor. However, the problems don’t just end there. The suit also exposes another of the company’s soft underbelly, violation of labor laws. In arguing against the antitrust violation claims, Uber will try to claim that Uber’s drivers are independent contractors and are thus not engaged in corporate collusion. However, this exposes the company to suits by employees who may feel that they are entitled to a minimum wage, the right to unionize, overtime benefits and unemployment benefits (Carter 1). Uber received a blow in the UK when the

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