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California Sues Uber Over Practices

mpicpp writes with news that California is the latest government to file a lawsuit against Uber. "California prosecutors on Tuesday filed a lawsuit against Uber over the ridesharing company's background checks and other allegations, adding to the popular startup's worldwide legal woes. San Francisco County District Attorney George Gascon, meanwhile, said Uber competitor Lyft agreed to pay $500,000 and change some of its business practices to settle its own lawsuit. Los Angeles District Attorney Jackie Lacey partnered with Gascon in a probe of the nascent ridesharing industry. A third company — Sidecar — is still under investigation and could face a lawsuit of its own if it can't reach an agreement with prosecutors. Uber faces similar legal issues elsewhere as it tries to expand in cities, states and countries around the world. The companies have popular smartphone apps that allow passengers to order rides in privately driven cars instead of taxis."

22 of 139 comments (clear)

  1. Ride sharing? by EzInKy · · Score: 5, Insightful

    "Hey Ez, where are you going"?
    "Up to the store".
    "Mind if I go with you, I need a few things".
    "Not at all".
    "Thanks, here's a couple of bucks for gas".

    That is ride sharing. Uber, Lyft, and the others are arranging drivers for hire. Just pointing out the obvious here.

     

    --
    Time is what keeps everything from happening all at once.
    1. Re:Ride sharing? by nbauman · · Score: 4, Insightful

      "Hey Ez, where are you going"?
      "Up to the store".
      "Mind if I go with you, I need a few things".
      "Not at all".
      "Thanks, here's a couple of bucks for gas".

      That is ride sharing. Uber, Lyft, and the others are arranging drivers for hire. Just pointing out the obvious here.

      You missed some more obvious:

      (1) Ez and his ride-sharer knew each other. The ride-sharer doesn't have to worry about Ez robbing him and vice versa.

      (2) Ez was going to the store anyway. The purpose of his trip was to go to the store. His purpose wasn't to make money out of the trip.

      That's the difference between Uber and Ez.

      If that's not obvious to you, it's obvious to Ez' insurance company if he gets into an accident.

    2. Re:Ride sharing? by CanHasDIY · · Score: 2

      Indeed - the only difference between Uber and traditional taxi services is that they've replaced "pick up the telephone and call" with "get on the internet and call."

      Oh, and that whole "expectation that our commercial transport service not be considered a commercial transport service" attitude.

      --
      An enigma, wrapped in a riddle, shrouded in bacon and cheese
    3. Re:Ride sharing? by gstoddart · · Score: 5, Insightful

      But ... but ... they're a tech company ... they have an app ... they dispatch using technology. My god, can't you see that this is completely different from a taxi company?

      Why, being a tech company, and having an app ... they're nothing at all like a cab company.

      Sure, they dispatch drivers to pick you up and drive you somewhere else for money, but ... it's done with a freakin' app, that makes it totally different. Because with an app, the cabs are dispatched with the help of unicorns and kittens.

      Yeah, whatever.

      My problem with Uber is there is no way to make their argument about being magically exempted from regulation stick. You can't just decree that laws don't apply to you. You can't just decree that your car-for-hire service isn't a car-for-hire service just because the drivers don't work for you.

      Their spokespeople have been trained to sound collectively delusional, and either they know they're full of shit, or have drank so much of the kool aid they really believe they're a different kind of entity.

      The problem is, they're not the ones who define what they are and what laws apply.

      So, yawn, this is just a continuation of the .COM era, except this time it's with smart phones and apps.

      You suddenly become worth billions of dollars, when you don't have billions in assets or even revenue. It's an overhyped stock, in an overhyped market, by people who are convinced they're something new.

      Except for the GPS part, you've been able to dial #taxi for years. A cellphone doesn't magically make you not a taxi.

      Uber is just hype, and once the law establishes they're just a taxi company trying to pretend otherwise.

      Claiming you're a technology company who just enables scheduling for illegal cabs just won't cut it.

      --
      Lost at C:>. Found at C.
  2. Not "ridesharing" by gnasher719 · · Score: 4, Insightful

    Can we just say that this is not "ridesharing". Ride sharing happens when I want to go from A to B, and I pick you up on the way because you want to go to a similar route.

    The Uber drives have no intention to go from A to B themselves. They are sitting at home waiting from phone calls. It's a private hire car, where you rent out a car together with a driver, to transport other people for payment to places that you don't want to go yourself.

    1. Re:Not "ridesharing" by AchilleTalon · · Score: 4, Insightful

      The problem is this isn't ridesharing, neither carpooling. The driver has no intention to go where the passenger wants to go and he will do so only because he is paid for. You are not pooling anything here, you are doing what taxis are doing and taxis don't do carpooling because carpooling is primarily intent to ease traffic jams and taxis don't want to take rides in traffic jams. Bottom line, yes, you are right Uber is trying to pull some business away from the traditional taxi industry. It is then perfectly understandable the industry is trying to protect itself from this threat. I don't know what is the compensation for someone enrolled into Uber to provide the service, but here, after doing the math, I don't see how someone can even break even provided the charges. The lower rates are at the expense of the car owner. You can do a little money only if in fact you are giving rides to someone going approximately where you are going anyway.

      Another point that is of very concern to the customer, what will happen if you have an accident? Will the car owner insurance pay for the passenger? Can the passenger sue the driver? Can the passenger sue Uber? As far as I know, the standard insurance does not cover such activity as taking passenger for a fee on a regular basis.

      --
      Achille Talon
      Hop!
    2. Re:Not "ridesharing" by Registered+Coward+v2 · · Score: 2

      Another point that is of very concern to the customer, what will happen if you have an accident? Will the car owner insurance pay for the passenger? Can the passenger sue the driver? Can the passenger sue Uber? As far as I know, the standard insurance does not cover such activity as taking passenger for a fee on a regular basis.

      Most personal car policy exclude commercial use, so no the owner's policy would not provide coverage; according to some news accounts insurers cancel policy if they find out your driving for Uber or Lyft or some other service. That's not surprising since they would not want to be held liable by a court despite their exclusion. While Uber advertises it has insurance for its drivers it's not clear policy exclusions are included. For example, it appears if the Uber driver fails to activate the ride there is no coverage. What happens if the driver lets a friend use his or her car to do the ride? What happens if there is more losses than the $1 million in coverage? Uber would no doubt say they are not liable, so who is? Is the driver your agent, making you responsible for the loss?

      Uber et. al. have a good idea but I disagree with their claim they are not a taxi / limo service. All they have done is take the old model of "call 555-TAXI" and replace the landline and dispatcher with an app; as such they should conform to the laws regulating such services. If they can't make a go of it while doing that then it wasn't a very good idea after all.

      --
      I'm a consultant - I convert gibberish into cash-flow.
  3. Re: What did you expect from California ? by Anonymous Coward · · Score: 3, Informative

    California isn't the problem. It's the south that has barely entered the 21st century that's the problem. These warmongering gun-toting redneck racist bible thumpers are what's giving the USA its bad reputation.

    It was sarcasm. California is one of the best states to live in, althougjh I personally prefer the east coast.
    As for all those regulations, it's the price to pay for not living in a polluted cesspool. Go California. :)
    Uber can compete all they want. As far as they are subject to the same rules and regulations as everyone else is that has a taxi service is subject to.
    If it walks like a dog, barks like a dog and eats dogfood it is not a cat. Uber is a taxi service in all but name.

  4. Re: Go California! by plopez · · Score: 3, Insightful

    What planet are you on? Or are you too young to remember how consumers got screwed before consumer protection laws. Yeah feel free to stop using the service after you get killed because your Uber driver was drunk. And it just isn't the passenger there are also other drivers who may be killed or maimed by an unqualified Uber driver. It's not just all about you. And try suing if you get hosed. You will find punishing Uber nigh impossible.

    --
    putting the 'B' in LGBTQ+
  5. Re: Go California! by Rei · · Score: 3, Interesting

    Consumers are terrible at protecting themselves. "Quality Products / Services" takes third place in terms of things that get a business to the top, after "Excellent PR Control / Advertising" and "Ruthless Business Practices". If you want to see what happens when you reduce consumer protections and monitoring, look to the third world where companies put melamine in their food to artificially inflate the protein count and fake baby formula with little to no nutritional value gets passed off as legit.

    --
    "We consider that six courts and an asylum claim are a rather odd way of returning to Sweden within a month."
  6. Re:Uber driver arrested for Delhi rape was career by nbauman · · Score: 2

    Not just India. Do a Google search for "uber driver criminal"

    http://www.nytimes.com/2014/12...
    Uber’s System for Screening Drivers Draws Scrutiny
    By MIKE ISAAC
    DEC. 9, 2014

    Uber uses Hirease, a private company that says it has an average turnaround time of “less than 36 hours.”
    Both services do drug and alcohol testing, but neither does fingerprint testing. And they rely primarily on publicly available information.

    Although state background checks for taxi drivers vary by jurisdiction, lawmakers say they are generally more rigorous than either of these services. They usually include searches of private databases like F.B.I. records, gaining consent from prospective drivers for those searches,

    In California, those drivers must undergo checks by the state’s Justice Department, including fingerprint scanning, drug and alcohol testing, and searches of private databases. A check can take as little as three days, but as long as eight weeks.

    (Uber defeated bills to require the same checks, including fingerprints, required for taxi and limousine drivers, in California, Colorado, and Illinois.)

    http://www.nbclosangeles.com/n...
    Risky Ride: Who's Behind the Wheel of Uber Cars?
    How safe is Uber? The NBC4 ITeam investigates.
    By Joel Grover and Keith Esparros
    Friday, May 2, 2014

    UberX, where anyone with a car and the inclination can apply to be a driver.

    Maps: Uber Regulations in the U.S. | Uber Timeline

    That's exactly what Beverly Locke did. Working with the NBC4 I-Team, Locke filled out all the necessary documentation needed to become an Uber driver. She proved she was a licensed driver with a safe car, and agreed to submit to a background check.

    Four weeks later, she received an e-mail indicating her background check had cleared.

    On her first day "on the job," she received a request from Paolo, a frequent UberX user, who was looking for a ride from his Hollywood apartment. He is an Uber fan.

    "I use cabs a lot," said Paolo. "And, it's almost half the fare in Uber than for a taxi driver."

    Who's Watching Uber?

    His phone lit up with a picture of Locke, and a message that said Beverly will pick him up in three minutes.

    What he didn't know is that Beverly was an ex-con with a violent past. Her 20-year rap sheet includes burglary, cocaine possession, and making criminal threats with the intent to cause death or bodily injury.

    "I pulled a girl out of a car and almost beat her to death," said Locke, who described herself as a reformed criminal with a good job and a desire to make up for her past. "I do not do criminal things anymore."

    NBC4 asked Locke to cancel the ride, so the former convict never actually carried a passenger. But the NBC4 I-Team found several examples in which drivers with a criminal past have picked up Uber passengers.

    Tadeusz Szczechowicz drove the streets of Chicago for a year, despite five prior arrests and two convictions for burglary and disorderly conduct.

    Syed Muzzafar had a prior conviction for reckless driving, but he cleared the Uber background check and was behind the wheel New Year's Eve when he was arrested for hitting and killing a 6-year-old girl in San Francisco.

    And, Jigneshkumar Patel was arrested for battery of an UberX passenger, a charge he said is "rubbish." Still, the UberX driver had a 2012 conviction for DUI.

    Uber declined to talk to NBC4 directly, but did send emails describing corporate policy on background checks. A message said Uber "leads the industry" with its "best-in-class background checks for drivers."

    Uber also said it has a "zero tolerance" policy for drug and alcohol offenses, and said it carefully screens applicants and immedia

  7. Re: Go California! by nbauman · · Score: 4, Insightful

    Adam Smith's invisible hand didn't build those streets and highways that these cars drive on. They were built by the government with taxes.

    If you're driving on a private road, you can ignore the regulations.

    If you want to drive on the public roads, you have to follow the government regulations. License and registration fees for private cars are based on typical use. License and registration fees for taxis and limousines are based on heavy, 24 hours a day use, and cost a lot more. They set up regulations because with generations of experience they've seen all the problems that come up and don't want those problems any more. Passengers don't want to get robbed and raped by their drivers. They don't want drivers who are drunk. They don't want to be injured by uninsured drivers. The Uber free market isn't very good at eliminating those risks.

  8. Re: Go California! by gstoddart · · Score: 4, Insightful

    There's a government failure here, let the free market fix it.

    Oh, horse shit.

    You're delusional. The free market doesn't exist. It doesn't solve problems. It doesn't achieve optimal outcomes.

    It's a fucking abstraction describing long-term outcomes under a perfect hypothetical model based on crap assumptions, not some divine entity.

    Adam Mith's invisible hand works wonders, it will fix this too.

    In practice, the only thing Smith's "invisible hand" is doing is picking your pocket and giving you the finger.

    It isn't some magical entity. It doesn't make good choices. It doesn't care what happens to you. It doesn't actually care if you have perfect information. It doesn't really exist.

    The invisible hand is the collective actions of the market over an extended period of time -- and collectively the market is rigged, and people are gaming the system. The invisible hand won't fix that.

    The premise that the free market achieves perfect outcomes over the long haul assumes the system isn't corrupt, and that the players aren't actively undermining it.

    But humans are corrupt, and always will be. Which means in practice the "free market" devolves into cartels and other things which try to stop the market from being free.

    It doesn't exist. Has never existed. Cannot exist. And if by accident it briefly existed, it would be undermined immediately by the humans.

    --
    Lost at C:>. Found at C.
  9. Re:More likely to be killed by cops than Uber by plopez · · Score: 3, Insightful

    Nope. Uber is a bunch of pirates. If you think Uber or Lyft have your best interest and safety in mind think again. Uber and Lyft are answerable to one. If things get really bad people can scream at the PUC and vote elected officials out of office. You cannot fire the owners of Lyft and Uber. They don't care. They are making a profit by externalizing risk which is wrong wrong wrong. Greed is not good.

    --
    putting the 'B' in LGBTQ+
  10. Re: What did you expect from California ? by bws111 · · Score: 2

    In some cities no distinction is made between cabs that are 'hailed' and cabs that are phoned for.

    In other cities (such as NY) they do make a distinction. 'Yellow cabs' are hailed, and can not be phoned for. 'Black cars' are phoned for, and can not be hailed. Both are regulated.

  11. Re: Go California! by Ol+Olsoc · · Score: 3, Interesting

    The free market doesn't exist. It doesn't solve problems. It doesn't achieve optimal outcomes.

    It's a fucking abstraction describing long-term outcomes under a perfect hypothetical model based on crap assumptions, not some divine entity.

    Blasphemy! Apostacy!

    One wonders at the free marketeer's assumptions that government is always corrupt, and that private industry is always honest, and above reproach.

    I liken the situation to vaccines, where some people wonder why a vaccine is needed, because it seems no one gets that disease any more.

    It really wasn't teh eevlul cguvmint'z desire to hamstring the people's rights that got these regs started, it was things like plaster of paris in bread, bogus scale systems that give you 11 ounces of meat when you were paying for a pound, the Cuyahoga river catching on fire, and much more.

    This is not to say that the selfsame impeccably honest free marketeers won't try to take advantage of those evul regulaytoons when it suits their purposes, wihness the conservative lynchpin states like Texas trying to keep Tesla sales out of their domains. Regulations are bad except when they aren't?

    But that's a side issue, more to my point of the guvmint not being the sole home of corruption.

    --
    The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
  12. Re: What did you expect from California ? by Russ1642 · · Score: 2

    Exactly. Taxis are so heavily regulated for two reasons. First of course is taxes. Second, and more important in my opinion, is because they have a long long history of screwing their customers. They deserve every bit of regulation that's thrown their way, from licensing, vehicle standards, pay guidelines, etc. They're a very common and important service and they NEED to be heavily regulated or every tourist that visits your city gets screwed. It's not how cities want to present themselves to the world. Now, how this affects Uber is that they're a taxi service that thinks the rules don't apply to them. I expect every city in the country will eventually sue them for not following the taxi regulations.

  13. Re: Go California! by kilfarsnar · · Score: 4, Interesting

    What planet are you on? Or are you too young to remember how consumers got screwed before consumer protection laws. Yeah feel free to stop using the service after you get killed because your Uber driver was drunk. And it just isn't the passenger there are also other drivers who may be killed or maimed by an unqualified Uber driver. It's not just all about you. And try suing if you get hosed. You will find punishing Uber nigh impossible.

    People, and free-market Libertarians in particular, have this idea that if there is a problem between two parties, one can just sue the other and it'll get worked out. They don't seem to realize that a lawsuit is a huge pain in the ass for everyone involved (except the lawyers), and is also very expensive. Lawsuits are out of reach for most people simply because of the cost. It's just not realistic.

    For more insight, I would point you to Fletcher Reede in "Liar Liar", when his car is damaged by a tow company:

    "You know what I'm going to do about this? Nothing! Because if I take it to small claims court, it will just drain 8 hours out of my life and you probably won't show up and even if I got the judgment you'd just stiff me anyway; so what I am going to do is piss and moan like an impotent jerk, and then bend over and take it up the tailpipe!"

    --
    "What the American public doesn't know is what makes them the American public." -Ray Zalinsky (Tommy Boy)
  14. Re: Go California! by kilfarsnar · · Score: 2, Insightful

    Consumers are terrible at protecting themselves. "Quality Products / Services" takes third place in terms of things that get a business to the top, after "Excellent PR Control / Advertising" and "Ruthless Business Practices". If you want to see what happens when you reduce consumer protections and monitoring, look to the third world where companies put melamine in their food to artificially inflate the protein count and fake baby formula with little to no nutritional value gets passed off as legit.

    Yeah, but what about Comcast? They're the most hated company in the country. They screw their customers and no one wants to do business with them. So everyone exercised their power as consumers and sued Comcast or simply took their business elsewhere. Eventually Comcast went out of business because they provided such terrible service.

    Isn't that how it happened?

    --
    "What the American public doesn't know is what makes them the American public." -Ray Zalinsky (Tommy Boy)
  15. Re:Better solution by Anonymous Coward · · Score: 2, Interesting

    I hope we eventually agree on something like a private-commercial drivers license and car registration. That would make all this Uber stuff much easier to swallow.

    Basically, just as there are federal rules for private liability car insurance, the government should define a new class of insurance coverage for drivers who do commercial ride sharing. Then let actual insurers figure out what to charge, and compete for customers. Maybe billing for some plans could be done by how active you are, instead of "all you can eat", since activity is so easy to track. In order to qualify for the insurance, your car also needs to pass a more stringent (and frequent) inspection than the regular thing we all have to do. Again government guidelines for what this should entail are necessary.

    The basic idea is this: government defines sensible standards, the private sector competes to satisfy standards. In most insurance settings, this is how it works. I think it's a no-brainer that the system should be extended to paid ridesharing, which clearly requires a different licensing and insurance from the kind that I have now.

  16. Re: Go California! by spasm · · Score: 2

    "if I take it to small claims court ... you probably won't show up"

    In which case you automatically win.

    "and even if I got the judgment you'd just stiff me anyway"

    In which case the court will help you garnish their wages, order their bank to pay you from any funds they have in the bank, suspend their professional license and/or drivers license until they pay you, and a range of other things that will make their life a complete misery (http://www.courts.ca.gov/1179.htm).

    But yeah, it does take time. But laying all this out to them in a demand-for-payment letter so they see that you know how the system works and are willing to grind through those steps is usually sufficient to get people to stop bluffing and pay you if you're clearly in the right.

  17. Re: Go California! by thetoadwarrior · · Score: 2

    You mean like BP being taken to court over mistakes that were likely caused by contractors? Sorry but people are only in his car based on trust in the Uber brand and the driver still works for Uber. They have some responsibility for hiring bad drivers. They've not done their job to protect their customers properly.