Uber Technologies Inc. was sued by more than a dozen California cab companies over claims it falsely advertises its ride-share service promotes as safer than taxis.
Uber misleads customers about the background checks it uses to screen its drivers and doesn’t require those contractors to take a driving safety course, according to the complaint filed Wednesday by Yellow Cab Co. and other operators in the metropolitan areas of San Francisco, Los Angeles and Santa Barbara.
Lawsuits against Uber, Lyft Inc. and other car-booking companies have mounted as they seek to crack open the U.S. taxi and limousine market, estimated by IbisWorld Research to be an $11 billion industry. Uber, founded in 2009 and based in San Francisco, is the most highly valued U.S. technology startup. The company raised $1.2 billion in December at a valuation of $40 billion.
Uber’s app-based, on-demand transportation service has faced criticism in some cities for using drivers who don’t have taxi or limousine licenses.
The company called Wednesday’s lawsuit frivolous, saying it was filed by an industry that has ignored the safety of riders and drivers for decades.
Uber December by the district attorneys of San Francisco and Los Angeles, who accused it of falsely assuring customers that it used “industry-leading standards” to vet its drivers while failing to use fingerprints to check criminal histories.
“Uber uses its website to try to convince customers that Uber offers safer rides than taxi cabs,” according to the cab companies’ ccomplaint filed in San Francisco federal court. “The truth — UberX does not provide a safer platform than plaintiffs’ taxi cabs.”
Uber is accused of violating California’s false advertising and unfair competition laws. The cab companies seek Uber’s profit, restitution and other unspecified damages.
“As riders across the country know, Uber’s multi-layered driver screening includes county, federal and multi-state checks and the rating system and traceability of the Uber platform gives riders and drivers unprecedented transparency,” Uber said in an e-mailed statement.
The case is L.A. Taxi Cooperative Inc. v. Uber Technologies Inc., U.S. District Court, Northern District of California (San Francisco).
With assistance from Serena Saitto in New York.
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This article was written by Pamela MacLean from Bloomberg and was legally licensed through the NewsCred publisher network.