As Uber battles 13 lawsuits, cabbies & state agencies are out for blood (update)

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Updated May 8 10:20 a.m. Pacific to reflect the total number of state insurance agency warnings.

If cab companies and state officials get their way, they’ll regulate ride-sharing service Uber to death.

Ambitious transportation startup Uber now faces at least 13 active lawsuits in the U.S. and is under fire from 11 state insurance agencies over its insurance practices.

You’d think the firm would be busily working the phones for damage control, but it’s not — Uber’s spokesperson and head of corporate communications, Andrew Noyes, has left the company. The former Facebook public policy manager originally joined Uber less than 12 months ago.

Since Noyes’ unexplained departure, Uber has nearly gone dark; only the unresponsive company’s expansion plans are clear. Not long after it announced its 100-city milestone, VentureBeat discovered a series of job listings revealing Uber’s next batch of cities. Future offerings, including the Family service, reflect Uber’s continued plans to disrupt the traditional ground transportation industry.

And disrupted they are.

Uber v. taxi lobby

State insurance agency officials from 11 states — including CaliforniaOhioNebraska, Connecticut, and Minnesota — are lining up to condemn Uber for its insurance “coverage gaps.” While the states in question have issued statements of their own, one organization is drastically amplifying the message: the Taxicab, Limousine & Paratransit Association, a nonprofit that claims to include “1,100 regulated transportation companies.” (Note the use of the term “regulated.”)

For colorful commentary, we called Dave Sutton, the spokesperson for the Taxicab, Limousine & Paratransit Association’s “Who’s Driving You?” initiative. According to Sutton (emphasis: VentureBeat):

We’ve been warning about the risks, and now you have insurance experts in all these different states warning people. Insurance is very simple. Private drivers will not be covered by their insurance. …The ridesharing companies have said, “Well, our policies are supplementary,” but insurance experts are saying that this is not acceptable. The only way to provide coverage for driving commercially is commercial coverage.

Our members have a financial interest in this — yes, they do. But what we are talking about is public safety.

In the limited cases where Uber responded to our numerous requests for comment, the company called the Taxicab, Limousine & Paratransit Association’s campaign “a scare tactic.” (emphasis: VentureBeat)

The ‘Who’s Driving You?’ campaign is nothing more than the taxi lobby trying to protect an antiquated industry from competition and consumer choice.

Central to this controversy is Uber’s insurance policy, which leaked in March. Uber is under fire from both private- and public-sector institutions due to claimed gaps in insurance coverage. Uber’s response to these claims has remained consistent since its 2012 San Francisco lawsuit:

Uber complies with all laws and regulations applicable to its business. Any claim to the contrary is baseless and motivated by those who seek to deprive the public of this safe and convenient transportation option. Uber would rather compete for business on the streets of San Francisco than in the courtroom, but Uber will defend these claims in court and is confident of the outcome.

That 2012 lawsuit was eventually dropped. But for Uber, it was only the tip of the start.

The lawsuits: Regulation, insurance, and death

While Uber battles two insurance-related lawsuits, the company is also under attack from drivers for allegedly withholding tips and for allegedly sidestepping industry regulations. On the most extreme end of the spectrum, Uber is wrestling a wrongful death lawsuit after a purported Uber driver struck and killed a 6-year-old girl this past New Year’s Eve in San Francisco.

According to Uber communications team member Lane Kasselman, these lawsuits are largely frivolous:

Despite often frivolous lawsuits filed by anti-competition taxi interests, the critical fact is that in no us [sic] city has a court decided that Uber can’t operate.

Yet Uber drivers are reportedly facing fines from legal authorities in New York and Tampa Bay, Fla. Given the century-old, highly regulated industry in which Uber operates, these roadblocks are unsurprising. However, the company’s aggressive growth has shifted the narrative.

Uber’s 13 active U.S. lawsuits are listed below, obtained from U.S. court database The below lawsuits come from passengers, traditional taxi and limousine companies, and Uber drivers themselves:

  1. Wrongful death suit: Ang Jiang Liu et al v. Uber — San Francisco
  2. Regulatory complaints: Western Washington Taxicab Operators v. Uber — Seattle
  3. Regulatory complaints: Greater Houston Transportation Company v. Uber — Houston
  4. Regulatory complaints: Shahriar Noorparvar v. Uber — California Central District
  5. Regulatory complaints: Mazaheri v. Doe et al — Oklahoma City
  6. Regulatory complaints: Illinois Transportation Industry v. City of Chicago — Chicago
  7. Withholding tips: Ehret v. Uber — San Francisco
  8. Withholding tips: O’Connor v. Uber — San Francisco
  9. Regulatory complaints: Boston Cab Dispatch v. Uber — Boston
  10. Regulatory complaints (demand of $10M ): Manzo v. Uber — Chicago
  11. Insurance: Landmark Insurance Company v. Uber and Yellow Group — Illinois
  12. Insurance (related to #11): Landmark Insurance Company v. Uber and Yellow Group — Illinois
  13. Regulatory complaints: Yellow Group v. Uber — Illinois

What we have now is a pile-on. At best it will disincentivise Uber to innovate and bog it down for years in legal limbo. At worst, it will kill off Uber and suffocate its competitors along with it, including Lyft and Sidecar.

According to Silicon Valley legend Marc Andreessen, Uber’s software “eats taxis.” But for Uber chief Travis Kalanick, these conflicts are just par for the course.

This is what happens when you destroy an antiquated system. Unless that system destroys you first.


More information:

Uber Technologies Inc is known as Everyone's Private Driver. Uber operates an on-demand car service used all over the world. With the touch of a button from your phone, you can experience your own private driver. Sign-up quickly, g... read more »

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David Shantz
David Shantz

no no, America is much less bureaucratic than most... but change sometimes requires a fight. I was in Miami a few weeks ago, no Uber - taxis were either OK, or like an hour in a Mexiacan Jail (don't ask) Change is in the wind, but its going to be a fight. This and AirBNB

Matt Alva
Matt Alva

GO UBER!!!! Destroy the Unions. They don't innovate!

Greg Kieser
Greg Kieser

Exactly why bitcoin and the blockchain technology are necessary for every industry. No company to regulate. No servers to shut down.

Wendy Sue Buckleman
Wendy Sue Buckleman

Why don't they write an program to cover each other's dispatch's when better for the customer and give each other a percentage?

Ron Ryder
Ron Ryder

I use Uber consistently. They are cleaner, faster, polite, totally reliable, customer oriented, and have cars in better repair and have some remote concept of customer service. Cab companies are being destroyed by a much better competitor and the market has spoken in every market Uber is operates. Oh, did I mention safer? The system knows who picks you up and when. Also, did I mention a rating system that keeps the drivers wanting high ratings? Oh, did I mention drivers rate you back, if you are consistently an ass, good luck getting Uber drivers to pick you up. Seems like a good system for everyone.

Kate Gallagher
Kate Gallagher

My guess is Uber tries too and the cab companies don't want to listen. Have you ever had to talk to the owner of a car service or cab company? They are pretty awful at least in LA they are. Never again do I want to talk to them.

Kate Gallagher
Kate Gallagher

Well if cab companies would have figured out the tech years ago it wouldn't be an issue...the problem is cab companies didn't innovate Uber did so so long cab companies I much prefer Uber anyway...still if cabs ruin it that will suck.

Tim Fox
Tim Fox

Thanks for killing innovation, move along.

Suresh Kumar
Suresh Kumar

Was it Uber or Lyft that spread cooties like germ in their competitor's vehicles?

Howard Grimberg
Howard Grimberg

So licensure is a an antiquated system? Sweet, guess I'm a doctor now!

Peter Wasielewski
Peter Wasielewski

The one thing I went to school and paid 100k to learn was thus: Innovate, or Die. Its simple, rely on the past for too long and you will fail.

Michael Floyd
Michael Floyd

Oh, did I mention safer?  Ron, please explain how is Uber safer?  Do you mean safer because they run FBI background checks on their drivers?  Uber does not.  Because they drug screen their drivers? Uber does not.  Because they keep maintenance records on their cars? Uber does not.  Because if their driver has an accident and you get hurt, you'll be covered by Uber's insurance?  You won't.  They will tell you that is an issue between you and the driver and to file your claim with his personal car insurance and guess what? The drivers insurance agent will tell you to go spoon a goose as it does not cover commercial trips which, was what you were taking when you "Ubered" car service.  You'll be stuck with the medical bill.  I'm sorry but I just don't see where Uber is so much safer.  But it's so hip to Uber so I'm sure that's more important than your safety.