The opinions expressed here are those of the author, a columnist for Reuters.

By Sara Randazzo

June 4 (Reuters) - Uber is learning in California that few things unite plaintiffs' attorneys like a threat to their fees. What began as a bid to rein in what it calls “billboard lawyers” has instead galvanized them into a well‑funded political force of their own.

When the rideshare giant last fall backed a proposed ballot measure to limit legal fees in car-crash lawsuits, consumer attorneys retaliated with a proposal to lower the legal threshold for holding Uber liable for driver misconduct. Each side has now raised more than $70 million and gathered more than a million signatures to advance their own ballot measures and oppose the other.

In dueling Super Bowl ads and marketing campaigns, both Uber and the plaintiffs' bar say they are looking out for consumers. But it seems pretty clear that what’s driving this political drama is, quite simply, money.

“It would probably be an extinction event,” Torrance-based trial attorney Robert Simon said of what could happen to personal-injury law firms if voters approve Uber's measure in November. Geoffrey Wells, a veteran plaintiffs’ lawyer in Los Angeles, agreed: “Lawyers won’t take those cases.”

Uber’s measure targets attorney contingency fees, which are only paid if a client wins. It’s common for attorneys to receive one third of any settlement, or 40% or more if a case goes to trial.

The Uber-backed campaign says they are clamping down on self-serving lawyers who don't put their clients' interests first. Nathan Click, a spokesman for the campaign, said the main goal is to make sure "accident victims — not billboard attorneys — actually take home the majority of their awards."

'CODE RED'

The confrontation began on a Friday afternoon in October, when leadership at the Consumer Attorneys of California, known as CAOC, got word that Uber had filed a proposed ballot measure to ensure plaintiffs receive 75% of legal recoveries from car-crash cases, limiting attorney and doctor payouts in the process.

Within hours, lawyers from across the state began mobilizing. “You start texting everybody, emailing all the list servs: This is code red,” said Simon, who helped organize a virtual meeting that first weekend attended by hundreds of attorneys.

CAOC members and legislative staffers hustled to come up with three ideas of their own to potentially take to voters.

One would have directly negated Uber’s measure, but it required at least 300,000 more signatures than their other ideas because it would have modified California's constitution rather than ordinary state law. Several people involved with CAOC told me the costs of signature gathering, weighed against its chances of success, became too much.

The plaintiffs' lawyers instead converged around a measure that would require rideshare companies to run better background checks on drivers, including fingerprinting, and be held to a higher liability standard if drivers assault passengers. Uber would be considered a “common carrier” that "must use the utmost care and diligence" to ensure passengers' safe passage, similar to taxi, train and airline operators.

If passed, such a law could help plaintiffs’ lawyers suing Uber in more than 3,800 lawsuits in state and federal court over sexual assaults by Uber drivers. Juries have sided with plaintiffs in two trials this year, with one awarding $8.5 million to a woman who said an Uber driver raped her. Uber, which has argued it shouldn't be held liable for criminal conduct by drivers using the app, notched a defense win in a state-court case last year.

An Uber spokeperson called the measure retaliatory and said the company has rigorous background checks and safety standards.

To rally support for their cause, the plaintiffs’ lawyers have held casino night fundraisers, hosted town halls and solicited signatures at attorney conferences. More than a dozen major consumer firms have donated at least half a million dollars to the campaign (including, yes, a few that advertise on billboards).

The $70 million raised so far has paid for ads, campaign consultants and professional signature gatherers. Because the Uber-backed measure also limits the recovery of damages for medical expenses, doctors are separately fundraising for their own opposition.

“I’ve never seen us more united, quicker, with the ability to raise more money in a short period of time than this one,” said Wells, who was in the waning days of his presidency of CAOC when the campaign started.

FULL STEAM AHEAD

In securities filings, Uber lists car-crash litigation as an operational risk that subjects it to "claims of significant liability," without detailing the number of cases it faces. An Uber spokesperson said its insurance limits make it a target of lawsuits.

The heart of the proposal is that consumers must retain at least 75% of the “total amount recovered." Lawyers I spoke to said they interpret the measure as meaning any medical fees tied to the litigation that need to be repaid would come from the remaining 25% along with attorney fees.

CAOC says there could be no money left for attorneys in catastrophic injury cases. Take a case with a $1 million recovery and $400,000 in medical bills and liens from surgery and hospitalization. Those expenses would exceed the 25% fee cap entirely.

Uber’s campaign says the attorneys are misinterpreting the measure and that medical liens would come out of the victim's 75%.

Uber is the sole contributor to its $77.8 million fundraising effort. In 2020, Uber successfully backed California's Proposition 22, which defines rideshare drivers as independent contractors and not employees.

Uber is separately pressing lawsuits against personal injury firms in Florida, California, New York and Philadelphia, accusing them of colluding with medical providers to file bogus and exaggerated claims related to car crashes.

An analysis by Berkeley Law’s Civil Justice Research Initiative found Uber’s measure is likely to be misunderstood by voters, decrease the availability of legal representation in the state and increase health care costs. “The confusing language of the proposed initiative may lead voters to mistakenly think that the initiative will ensure that victims will receive more compensation for their injuries when the opposite is likely true,” the authors wrote, because fewer attorneys would risk taking car-crash cases on contingency.

There hasn't been an independent analysis done of the CAOC-backed measure.

There’s technically still a chance neither proposition will make it in front of voters in November, as Uber and its opponents can walk away before a late June deadline. With this much money at stake, both sides say this one is poised to go the distance.

"We're not backing down," Douglas Saeltzer, the current CAOC president, said this week.

Click, the Uber campaign spokesman, told me: "We're full steam ahead."