Background
Seattle’s App-Based Worker Deactivation Rights Ordinance regulates network companies that connect customers with app-based delivery workers. Among other requirements, the ordinance directs companies to give workers written notice of their deactivation policies and requires those policies to be reasonably related to safe and efficient operations. It also identifies policies that do not meet that standard, including deactivation based solely on aggregate customer ratings.
Uber Technologies, its subsidiary Portier, and Instacart challenged the notice and policy requirements, alleging that they compelled speech in violation of the First Amendment and were unconstitutionally vague. The district court denied their request for a preliminary injunction, concluding that they had not shown a likely constitutional violation. The companies appealed, and enforcement remained stayed under the parties’ stipulation while the appeals proceeded.
The Court’s Holding
The Ninth Circuit affirmed the denial of a preliminary injunction. Assuming without deciding that the challenged provisions regulate speech, the majority held that the speech is commercial because it concerns the terms under which app-based workers may access the companies’ platforms for work. Applying the disclosure standard from Zauderer, the court concluded that requiring companies to inform workers of their deactivation policies is reasonably related to Seattle’s substantial interests in worker and public safety, requires factual and noncontroversial information, and is not unduly burdensome.
The court also rejected the challenge to the requirement that deactivation policies be reasonably related to safe and efficient operations. It reasoned that the provision regulates, at most, commercial speech related to activity Seattle has designated unlawful—unwarranted account deactivations—and would survive even the more demanding Central Hudson framework urged by the companies.
The ordinance was not unconstitutionally vague, the court held, because “reasonable” is a familiar legal standard and the surrounding text and examples provide fair notice of permissible deactivation grounds. Because the companies failed to show likely success on either constitutional claim, the district court did not abuse its discretion by denying preliminary relief. Judge Bennett agreed on vagueness but dissented from the First Amendment analysis, concluding that the ordinance compels speech and that the case should be remanded for Zauderer analysis and reconsideration of all preliminary-injunction factors.
Key Takeaways
- Workplace disclosures concerning the terms of app-based employment may qualify as commercial speech subject to Zauderer’s comparatively deferential standard.
- The panel upheld Seattle’s requirement that network companies disclose deactivation policies and limit those policies to grounds reasonably related to safe and efficient operations.
- A reasonableness standard is not necessarily vague when statutory context and concrete examples give regulated parties fair notice of what the law permits.
Why It Matters
The decision allows Seattle to enforce a major part of its protections against unwarranted deactivation of app-based delivery workers and gives municipalities greater latitude to require gig-economy platforms to communicate employment-related standards to workers.
The divided opinion also exposes an unresolved tension over whether laws requiring businesses to formulate and publish regulated policies merely compel factual commercial disclosures or force companies to express judgments subject to more demanding First Amendment scrutiny.