Uber agrees to pay up to $25M to settle L.A., S.F. lawsuits
On-demand private car service Uber Inc. on Thursday agreed to pay up to $25 million to settle lawsuits brought by the district attorneys of Los Angeles and San Francisco in 2014.
Uber was sued by the cities after an investigation revealed that the company misled consumers in adverts on drivers’ background checks. Regulators also claimed that the company failed to comply with the inspection of taxi meters as well as with the requirement of obtaining proper licenses to drop off & pick up passengers at the airport.
Suing the company, San Francisco district attorney George Gascón and Los Angeles district attorney Jackie Lacey told the judge that they found evidence that the company failed to screen out more than two thousand drivers with criminal records, including convictions for serious climes like kidnapping and murder.
At the time, Uber argued that the regulators’ claim that the company’s background-check process was faulty was wrong. But, the company yesterday agreed to make the huge payment to settle the claim. The S.F. Superior Court approved the settlement.
The company agreed to pay $5 million apiece to each of the two cities and up to $15 million in additional penalties in case it fails to comply with rule and regulations, including obtaining proper licenses for airport pickups.
In 2014, Uber’s biggest rival, Lyft Inc., agreed to pay $500,000 in civic penalties to settle a similar dispute with the state regulators.
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