The San Francisco District Attorney’s Office, in a joint investigation with the Los Angeles District Attorney’s Office, has sent letters to three popular ridesharing companies, alleging that they are engaging in unlawful business practices, sources said.
Uber, Lyft and Sidecar all received letters that are generally the same and seek to address what law enforcement sees as four general issues where the ridesharing companies may be violating the law.
The letters claim that the app-based services mislead consumers on the voracity of the background checks of its drivers, are in violation of a public utility code regarding new carpooling services, are operating out of airports without proper permits and are not adhering to division of measurement standards.
Sidecar released a copy of its letter to the press, which specifically addresses background checks and Sidecar’s new “Shared Ride” feature, a new service Sidecar and other companies are using where multiple riders can be picked up on the same trip, all paying different, separate fares.
According to the letter, the “Shared Ride” feature violates a public utilities code, 5401, which states that multiple fares sharing the same vehicle cannot be charged individually.
A spokeswoman for Sidecar said that the district attorney offices are enforcing laws written for limousines in an era before smartphones.
“We strongly disagree with the assertion by San Francisco and Los Angeles County District Attorney Offices that connecting people for Sidecar Shared Rides is illegal,” spokeswoman Jenna Richard said in an email. “Sidecar will continue to operate and expand shared rides.”
San Francisco District Attorney George Gascon said his office values innovation but wants to make sure that the safety and well-being of consumers are adequately protected in the process.
The letter states that the two offices would like to have a chance to meet with Sidecar no later than Oct. 8 to discuss whether Sidecar will remove all statements that imply its background checks reveal that a driver’s criminal background checks go back further than seven years and have removed the “Shared Ride” payment feature from its app.
Uber and Lyft received similar letters that include their references to their carpool features, called UberPool and Lyft Line and also have been invited to meet with the offices by Oct. 8.
If the ridesharing companies decline to meet, the district attorney offices are prepared to file a lawsuit seeking injunctive relief and civil penalties, according to the letter.