Taxi companies file suit over ride-sharing company
Utilities regulators also named for failing to stop Uber from doing business in R.I.
Two prominent Rhode Island taxi companies are asking a judge to stop ride-hailing company Uber — whose service they call a "massive illegal operation" — from doing business in the state.
In an Aug. 13 lawsuit filed in Providence County Superior Court, Orange Cab of Newport and Airport Taxi of Warwick seek a cease and desist order against San Francisco-based Uber Technologies Inc., its wholly-owned subsidiary Rasier LLC and the undisclosed number of drivers that use the company's app throughout the state.
And the lawsuit also names the state's top utilities regulators in the Division of Public Utilities and Carriers as defendants for failing to stop Uber from doing business in Rhode Island, asking the court to compel Rhode Island officials to do so.
Echoing a larger global fight over ride-hailing services, the taxis argue that under Rhode Island law any driver or company providing for-hire automobile rides must comply with the stringent regulations enforced by the Public Utilities Division.
"None of them do, and all of the services provided by Uber and Uber drivers are therefore illegal," the lawsuit says. "This massive illegal operation puts the public and consumers at risk and erodes the viability of licensed, authorized and legal taxicab operators."
The lawsuit is the latest skirmish in a dispute between taxi and ride-hailing companies that began in Rhode Island when Uber launched in the state in September 2013 and continued this year at the State House.
Throughout, Uber has argued that state taxi regulations do not apply to rides facilitated by its mobile app, which in Rhode Island are typically fulfilled by independent contractors using their own personal passenger cars and non-commercial drivers licenses. For the first year and a half it operated in Rhode Island, Uber didn't even remit the state sales tax it collected.
Lyft, Uber's rival and the only other ride-hailing app operating in Rhode Island, is not named in the lawsuit.
"While we can't comment on active litigation, I can say we will vigorously defend the rights of our riders and driver partners to greater choice and economic opportunity," said Uber spokesman Taylor Bennett in an email statement to the Journal Sunday.
For their part, state regulators have long agreed with the taxi companies that Uber and Lyft, under their current business models, violate the law in Rhode Island.
As part of a General Assembly study committee examining how to regulate ride-hailing, Division of Public Utilities Associate Administrator Terrence Mercer, a named co-defendant in the suit, said he believed Uber and Lyft were operating illegally in Rhode Island.
But he said without help from state and local police, the Division does not have the resources to stop hundreds of drivers giving rides in their personal vehicles.
After the study committee had finished its hearings, co-chairman Rep. John G. Edwards, D-Tiverton, proposed a bill intended to bring ride-hailing within state law by creating a new regulatory framework for "transportation network companies."
Edwards said earlier this month that he intended to re-file his "TNC" bill first thing next year.
House Speaker Nicholas Mattiello said the bill had been introduced too late for a vote in this year's annual legislative session, which wound up ending abruptly anyway due to an impasse with the Senate.
panderson@providencejournal.com
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