Chicago Taxi and Limo Industries Allege Unlawful and Unsafe Practices by Uber

Complaint Charges Uber with Breaking Numerous Public Safety and Consumer Protection Laws

CHICAGO, Oct. 8, 2012 /PRNewswire-USNewswire/ -- The following is being released by Taxi Affiliation Services:

Chicago-based taxi and livery companies have filed a lawsuit against Uber, a San Francisco-based transportation company.  The complaint accuses Uber of violating multiple Chicago and Illinois laws designed at protecting public safety, consumer protection and fair practices.  The complaint further alleges that Uber is using deceptive business methods to confuse its customers and mislead the public as to its non-existent quality and safety controls.

The taxi and livery industry is heavily regulated by both Illinois and Chicago laws, covering nearly every aspect of the industry from dispatching, insurance, licensing, meter pricing and payment processing.  Uber markets itself to the public as a high-end transportation company that provides taxicab and livery vehicles to consumers through the use of a GPS-enabled smartphone app, when in reality Uber is operating in violation of numerous laws.

The complaint charges that Uber's business model is built upon the use of drivers and vehicles from other transportation companies to provide services (without the knowledge or consent of such transportation companies), thereby avoiding its own compliance with public safety laws, and shifting all risks and liability to regulated affiliations and their members.  The complaint outlines the key issues created by Uber's unlawful business practices, including but not limited to:

Misrepresents the Vetting of Uber's "Fleet Partners"

To protect consumers and ensure public safety, Chicago ordinances require taxi and livery companies to provide insurance, make regular inspections and evaluations of vehicles, and ensure drivers have valid and non-suspended licenses at all times.  Despite its advertising claims of being a safe and high quality transportation service, Uber disavows any vetting of its drivers or vehicles and expressly disclaims any and all liability.  Uber does not actually own any vehicles but relies on the vehicles of taxi and livery companies.  Uber does not inspect the taxi vehicles to make sure they comply with city and state regulations and does not ask potential taxi drivers if they are properly insured.

False Association with "Fleet Partners"

Uber advertises that it works with its "fleet partners" when, in fact, Uber works directly with drivers in its taxi service.  Uber is deliberately trying to confuse customers and cash in on the taxi companies' good name, trademarks and reputation to add an air of legitimacy to Uber's illegal practices.  Similarly, Uber is also causing consumer confusion by misleading the public as to the owner and operator of livery vehicles.

Deceptive Payment Practices

Uber represents to the public that it charges a "20% gratuity" for all taxi rides, but only half of the "gratuity" goes to the driver – the other half goes to Uber.  Uber violates city ordinances by charging more than the statutory set rates displayed on the taxi meter.  Uber further illegally passes on credit card processing fees to taxi passengers in violation of Chicago ordinances.

Fraudulently Acquired Chicago Dispatch License

In Chicago, Uber mischaracterized its true methods of operation in order to fraudulently acquire a dispatch license.  Uber failed to disclose on its dispatch license application that it has no agreement with any taxi affiliations as required by Chicago ordinance.  Uber also failed to disclose it illegally dispatches both taxi and livery vehicles, also in violation of Chicago ordinances.

Driving With Cell Phones

Chicago taxi drivers are prohibited by city and state law from using cellular telephones or other electronic devices, whether or not hands-free, while operating a cab.  Uber requires drivers to use a company-issued iPhone and accept fares within a short period of time, and then call the customer using the driver's own cell phone to arrange the pickup.

Discriminatory Practices

Uber's business model does not allow for the request of vehicles for passengers with disabilities, nor does it allow for the use of subsidized taxi vouchers for passengers with disabilities. 

The complaint was filed Thursday, October 4, 2012 in United States District Court for the Northern District of Illinois, Civil Action No. 12-cv-7967.  The companies filing suit are Yellow Group, Yellow Cab Affiliation, Taxi Affiliation Services, YC1, 5 Star Flash, Chicago Medallion One and Your Private Limousine.

SOURCE Taxi Affiliation Services