Uber ballot initiative sparks showdown with lawyers, doctors

In November, California voters may have to referee a multimillion-dollar battle among Uber, attorneys, and doctors that could reshape how vehicle accident claims are handled throughout the state. The outcome could affect anyone who uses California’s roads and highways.

Uber filed a proposed ballot measure last fall that would cap personal injury lawyers’ contingency fees and limit medical damages for all vehicle crashes in California, regardless of whether an Uber is involved. The ride-hailing giant frames its effort as a way to rein in attorneys who allegedly take advantage of crash victims. Currently, accident survivors often hire attorneys on a contingency basis, meaning lawyers only get paid if they win the case.

The proposal has ignited fierce opposition from attorney groups, who responded by proposing three competing ballot initiatives. These would expand Uber’s liability for passenger injuries, increase its responsibility for sexual misconduct against riders or drivers, and ban new state laws that interfere with people’s ability to retain lawyers.

Medical providers have also mobilized against Uber’s initiative, forming a political action committee called Providers for Patient Care last October. They argue the measure could limit patients’ access to necessary medical care.

The financial stakes are enormous. Uber has invested approximately $32.5 million into its campaign since last fall, according to campaign finance records. The opposition has committed about $55 million to fight Uber’s measure and promote their competing initiatives. Consumer Attorneys of California has led the charge with $30 million, while more than 400 other attorneys and law firms have contributed a combined $20 million. Medical providers have raised about $5 million and aim to reach $10 million.

Both sides have already splashed out on high-profile advertising, including television commercials that aired during the Super Bowl.

This isn’t Uber’s first major ballot initiative in California. In 2020, the company spent over $70 million on Proposition 22, which allowed gig companies to classify their drivers as independent contractors rather than employees. That measure passed with substantial voter support.

Uber’s current proposal would require crash victims to retain 75% of any settlement they receive. It would also limit compensation for medical expenses and raise the burden of proof for recovering them. For liens and future medical expenses, the measure would cap reimbursements at 125% of the Medicare rate for a service and 170% of the Medi-Cal rate. Additionally, it would prohibit law firms from referring clients to healthcare providers in which they have a financial interest.

“Californians deserve a system that prioritizes victims over ambulance lawyers, and that’s exactly what this measure does,” said Nathan Click, a spokesperson for Uber’s campaign.

However, opponents argue that the measure would make it difficult for accident victims to secure legal representation. “Uber wrote it to be expansive, to keep victims from finding attorneys,” said Doug Saeltzer, president of the Consumer Attorneys of California. Lawyers would have less incentive to take cases if their compensation is capped at 25% of settlements, compared to the current average of 33% or more.

A particularly contentious aspect of the initiative involves who would be responsible for paying medical bills after a crash. Opponents claim Uber’s measure would require medical expenses to be paid from the attorney’s share of the settlement, while Uber disputes this interpretation.

Medical providers warn that the proposed limits on reimbursements could result in care being denied to uninsured or underinsured accident victims. “This is an attempt by Uber to get out of paying for patient care,” said Pamela Lopez, a representative for Providers for Patient Care. “This will affect you, me, anyone who’s ever injured in an auto accident in California.”

The nonpartisan Legislative Analyst’s Office noted that if Uber’s measure passes, the state could face tens of millions in increased Medi-Cal costs for healthcare that couldn’t be recovered otherwise. Conversely, the state might save on court costs if fewer auto accident cases are filed.

As a constitutional amendment, Uber’s measure requires more than 874,000 signatures by June 8 to qualify for the November ballot. By early February, it had collected at least 25% of that number.

Uber’s executives have told investors they expect lower insurance costs to help drive higher revenue growth. The San Francisco-based company generated more than $14 billion in revenue last year, and its leadership has mentioned efforts in various states to reduce legal and insurance costs.

Similar efforts by Uber in other states have faced challenges. Last year, the Nevada Supreme Court found that Uber’s description of a measure to cap attorneys’ contingency fees was “misleading and confusing,” though the company and lawyers later reached a legislative compromise.

Whether California voters will support Uber’s initiative remains to be seen. Stanford University law professor Nora Engstrom noted the measure has a “bumper sticker quality” that could appeal to voters despite the complex implications. “This measure could backfire for Uber, but it’s certainly possible that California voters will approve the company’s initiative,” she said.