PHILADELPHIA – Lyft is seeking to compel arbitration and stay all proceedings pending the outcome of that same arbitration, in the case of a Philadelphia entrepreneur and musician who claimed the company stole his concepts for the ride share company to engage with the needy without compensating him.
Marcus Pickett of Philadelphia first filed suit in the U.S. District Court for the Eastern District of Pennsylvania on Dec. 21 versus Lyft, Inc., of San Francisco, Calif.
“In 2016, Pickett created a concept to transform how Lyft promoted and increased its ridesharing business and engaged with and helped communities in need. Pickett’s ideas included that Lyft should combine and broaden the different existing ad hoc Lyft programs designed to help different communities, implement other ideas he had for programs, and combine them all into a single initiative that Pickett named “LyftUp,” the suit stated.
“Pickett felt that if Lyft unified its initiatives under a single brand, Lyft would have a greater capacity not only to do good, but also to strengthen and expand its ridesharing business. Pickett’s ideas also included potential partnerships with musicians and other celebrities to promote the program.”
Beginning in 2016, Pickett said he shared all of his ideas with Lyft, on the terms that they would be kept confidential and if they were ever used by the company, that Pickett would be financially compensated.
Once Pickett revealed his ideas to Lyft, he said Lyft executives led him to believe that his ideas were being deliberated internally, and that someone would contact him about his ideas.
“In early 2020, Lyft announced to the public that it had launched a new initiative called LyftUp. Pickett was floored when he learned that Lyft had used his ideas without his knowledge and without compensation. Lyft even used the logo that Mr. Pickett had designed, flip-flopping only the two colors used for the words LyftUp in the logo design he had provided Lyft,” per the suit.
“Lyft’s egregious misrepresentations to induce Pickett to reveal his ideas, and Lyft’s subsequent breaches of its agreement with Pickett, are counter to Lyft’s public claims as a company built on ‘values and culture.’ Pickett has been damaged by Lyft’s misrepresentations and breaches. As such, defendant Lyft should be required to stop using the LyftUp name and also be forced to compensate Pickett for the value of the confidential ideas that Lyft used without permission or compensation in breach of their agreement.”
UPDATE
Counsel for Lyft filed a motion to compel arbitration and stay proceedings depending on the outcome of that arbitration proceeding on May 3, under the Federal Arbitration Act.
The basis of this argument is that Pickett and Lyft signed a consulting agreement, where the parties mutually promised to resolve any disputes through binding arbitration.
“Plaintiff Marcus Pickett alleges that over a three-year period he pitched ideas for a marketing initiative to defendant, Lyft, Inc., in exchange for oral promises of confidentiality and payment, and that Lyft failed to compensate him. The complaint does not mention, however, the consulting agreement that Mr. Pickett and Lyft signed during the same time period,” the motion stated.
“In the agreement, Mr. Pickett promised to resolve all disputes arising out of or related to the agreement or his relationship with Lyft through binding arbitration. The agreement expressly covers the claims that Mr. Pickett purports to assert in this lawsuit – fraud, breach of contract, promissory estoppel and unjust enrichment. Accordingly, the Federal Arbitration Act and Pennsylvania state law require Mr. Pickett to submit these claims to an arbitrator. Lyft respectfully requests that the Court stay these proceedings and order Mr. Pickett to submit his claims to arbitration in accordance with the agreement.”
For counts of fraud, breach of contract, promissory estoppel and unjust enrichment, the plaintiff is seeking a permanent injunction against the defendant from continuing to use the name LyftUp in breach of its contract, damages to be determined at trial, pre-judgment and post-judgment interest, punitive damages; and such other relief as the Court deems just and proper.
The plaintiff is represented by Jeffery A. Dailey and Alfred A. Brown of Dailey LLP, in Philadelphia.
The defendant is represented by John G.M. Coit and Michele D. Hangley of Hangley Aronchick Segal Pudlin & Schiller, also in Philadelphia.
U.S. District Court for the Eastern District of Pennsylvania case 2:20-cv-06389
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com