Los Angeles and San Francisco sue Uber, settle with Lyft

Uber’s week from hell continued Tuesday, as the offices of the Los Angeles and San Francisco district attorneys filed lawsuits suing the company for unlawful business practices. The entities settled with Lyft for similar grievances.

There’s no news on where Sidecar stands with the DA offices, despite the fact that Sidecar was also threatened with legal action from the city governments back in September.

The DAs news release, as tweeted by New York Times’ Mike Isaac, says that the two offices are filing a civil consumer protection action lawsuit against Uber “for making false or misleading statements to consumers and for engaging in a variety of business practices which violate California law.” The DAs want multiple product and marketing changes from Uber related to how it describes its background checks, charges consumers, and tracks mileage, according to the filing, which was obtained by Re/Code.

Here are the DAs’ major grievances:

  1. Uber misleads customers about its safety procedures, especially in regards to background checks and the “Safe Rides” fee it charges consumers.
  2. Uber hasn’t submitted its mileage tracking technology for review, so the government can ensure it’s not ripping off passengers.
  3. Uber drops off and picks up passengers at the airport without airport approval. Further more, the fee it charges consumers to do so is “misleading.”

The DAs reportedly want Uber to pay restitution to customers for its $1 “Safe Rides” fee, which covers the cost of Uber’s background checks. Since Uber’s background checks aren’t as rigorous as the ones taxis are required to do, the city governments believe the Safe Rides charge misleads customers.

The DAs also want the ridesharing companies to submit their mileage to state government to ensure accurate tracking.

Lyft was amenable to the DAs’ requests, which is why it settled for $500,000, according to Forbes reporter Ellen Huet. In a statement, Lyft spokeswoman Erin Simpson said, “After months of productive conversations, Lyft has entered into an agreement with District Attorneys of San Francisco and Los Angeles that demonstrates our shared commitment to consumers and innovation.”

Uber, it appears, was not. When reached for comment, Uber spokeswoman Eva Behrand said:

Californians and California lawmakers all agree–Uber is an integral, safe, and established part of the transportation ecosystem in the Golden State. Uber has met with the District Attorneys to address their concerns regarding airport operations, the uberPOOL product, background checks, and operation of the app. We will continue to engage in discussions with the District Attorneys.

The SF and LA DA offices have been considering such action for months now after raising concerns about ridesharing companies’ background check practices. The two institutions threatened Uber, Lyft, and Sidecar in September with legal action if they didn’t change the way they described their background checks to the public. Since transportation networking companies aren’t held to the same rigorous background check standards as cab companies in California, they miss some drivers’ criminal records.

This post was updated several times Tuesday afternoon as more information became available.