Uber's 'Greyball' Program Puts New Focus on Legal Dept.

While the program may not be illegal, ethics professionals said, it does appear to skirt ethical standards and if in-house counsel approved the program knowing that Uber would use it to break the law, then disbarment could be in store for the lawyers who signed off on it.

Salle Yoo Jason. (Photo: Doiy/The Recorder)

SAN FRANCISCO — Uber Technologies Inc. has used software to evade law enforcement and public officials in cities where the company faced opposition from regulators, The New York Times reported Friday, and legal ethics professionals said the company may be steering into the wrong lane.

While the program may not be illegal, ethics professionals said, it does appear to skirt ethical standards. And if in-house counsel approved the program knowing that Uber would use it to break the law, then disbarment could be in store for the lawyers who signed off on it, they said. The New York Times report said Uber’s legal department, led by general counsel Salle Yoo, approved use of the program.

“For lawyers, the legal ethics issue is did they approve of the program so that Uber could act illegally?” Wayne State University professor of law Peter Henning said. “That could put a license at risk to practice law.”

“It’s a hard ethics problem,” said UC-Hastings College of the Law professor Rory Little.

The revelation of Uber’s program is the latest to put a spotlight on the San Francisco-based ride-hailing giant’s corporate culture and its legal department.

The Times report Friday said Uber uses a software tool called Greyball to evade members of law enforcement and regulatory agencies. Uber managers identify potential authorities by tracking car destinations—like watching if a user routinely gets dropped off at government offices—and by cross-referencing credit card numbers against government affiliated credit card unions, among other data the Times report said.

Uber’s press team said in a statement Friday: “This program denies ride requests to users who are violating our terms of service—whether that’s people aiming to physically harm drivers, competitors looking to disrupt our operations, or opponents who collude with officials on secret ‘stings’ meant to entrap drivers.”

For “greyballed” users, Uber delivers a fake version of its app, displaying cars that aren’t actually there or showing that no cars are available, the report said.

The Times report, based on descriptions and documents provided by current and former employees who spoke on condition of anonymity, said the program initially was developed to help Uber drivers avoid hostile competitors and problem users abroad. Uber provided a statement to the Times arguing the program is used to safeguard drivers from the risk of physical harm or entrapment from “sting” operations. The report said the program is still in use the United States and overseas.

“Evading regulatory authorities can sometimes be a problem all by itself,” Litte said. He added: “This could probably be called deception in the sense that Uber certainly didn’t tell regulators they were doing this.”

Henning, who also writes columns on white-collar law for The New York Times, said Uber can refuse rides to whomever it wants—so long as those decisions aren’t based on race or disability. But refusing rides to authorities is different, he said.

Henning said it is possible that state attorneys general could launch investigations into Uber. He said those investigations would reveal which lawyer or lawyers at the company approved the program, and what they knew about it. He said it is also possible that Uber’s lawyers approved some portions of the program without knowing exactly how Uber managers would use it, providing some coverage to the legal department.

“Lawyers have to ensure their clients comply with the law. That’s the cornerstone of corporate legal advice,” Henning said.

Uber has faced intense public scrutiny for weeks now. Last month, former site reliability engineer Susan Fowler Rigetti claimed she faced sexual harassment and discrimination during her one year with the company. Uber responded by launching a public investigation led by Covington & Burling’s Eric Holder Jr. Rigetti wrote on Twitter on Thursday that she hired law firm Baker Curtis & Schwartz located in San Francisco and Pasadena.

Originally published on The Recorder. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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David Ruiz

David Ruiz is the in-house counsel reporter for the San Francisco-based legal affairs paper The Recorder. Ruiz has written for The Sacramento Bee,...

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