Let Them Take Taxis…or Uber or Lyft
City may lift cap on cabs and embrace upstart ride sharing services. There will be rides for everyone!
The Pink Mustache Arrives in Milwaukee
Milwaukee alderman Bob Bauman and the Common Council have just discovered they can’t keep up with technology. And the race wasn’t even close.
“Sometimes what seems obvious six months ago doesn’t seem obvious any more,” Bauman admits. “Technology is funny that way.”
Actually, it was just a month ago, on March 17, that the city took what seemed the obvious step: holding a lottery to award the 100 new cab licenses Common Council members voted to issue. This was — finally — the solution to a controversy that dragged on for two-and-a-half years, ever since the libertarian Institute for Justice filed suit and demanded the city eliminate the cap on the number of cabs.
But just three weeks after the lottery was held, Bauman declared that this entire approach should be scrapped. The problem was the technological innovation of companies like Uber and Lyft, who bypass traditional cabs with sophisticated software systems that match those needing a ride to any driver who requests one from these online services.
“The technology of these companies have made the idea of a cap on taxicabs irrelevant,” Bauman says. “They will simply go into business anyway and dare you to track them down. And I don’t know if we have the resources to do that.”
A couple weeks before this, Lyft had begun advertising for drivers, as Don Walker reported for Milwaukee Journal Sentinel, and we soon learned the “pink mustache” (the company’s rather vaudevillian logo) had arrived in Milwaukee. Lyft, too, flashed some Brewers-oriented symbolism, picturing a pink-mustached car in front of Miller Park.
In short, by the time the city lottery for new licenses was held, it was abundantly clear that any attempt to cap the number of taxis or limousines or ride sharing services was futile. The genie was out of the bottle.
So Bauman quickly hatched a new plan, with the help of the city’s Public Transportation Review Board, which includes nine members of the community appointed by the mayor and common council president.
The plan is relatively simple. First, there will be no cap whatsoever on cabs. Second, there will be minimal requirements on operators of any kind: all drivers must have a drivers license, their car must have a public passenger vehicle permit and they must meet the city’s insurance requirement. Third, any violators will pay a fine, beginning at $2,500 and rising significantly with each added offense.
The fines will not be imposed on the companies themselves, Bauman notes. “I have no illusions about that. Uber and Lyft may laugh at these fines. They may not even have a physical presence in Milwaukee.”
Rather, the drivers themselves will be fined. “If they start getting $2,500 fines, that will have an impact,” the alderman predicts.
As for enforcement, Bauman and the committee envision having the city clerk’s office rather than the police do this. “The city clerk will have more time and interest in regulating these operators,” Bauman says. “The police have better things to do.”
So meet City Clerk Jim Owczarski, the new sheriff in town. How exactly will he track down the scoflaws? “Anybody with a smart phone can call for a cab,” Bauman believes. “When they get there you ask ‘where is your license?’”
I’m guessing this part of the plan might get some discussion as it comes before the Public Works Committee (in May) and ultimately before the full Common Council (in July, Bauman predicts). Perhaps they’ll add a requirement that Owczarski take a body building course. Or pack a gun. Maybe Sheriff David Clarke can consult.
Meantime there is a good deal of excitement in town about the arrival of Uber and Lyft. As I’ve previously reported, Milwaukee has for decades been a terrible town for taxis, with one taxi for every 1,850 residents, compared to one for every 319 residents in Phoenix, one for 424 Chicago residents and one for every 551 San Franciscans.
The city is terribly underserved, says Beth Weirick, CEO of the downtown business improvement district (BID 21) and a member of the city’s Public Transportation Review Board. “I’ve heard from tourists and locals and my own children it’s really hard to get a cab in this town. I could talk about some pretty bad experiences I’ve had with cabs, they can be dirty and not safe, though I’ve had good experiences.”
Weirich says she used the Uber service both in Milwaukee and other cities. “I liked it a lot. Every time it’s been a positive experience. The cars are clean, the drivers are polite and follow the traffic signals.”
“This is really an opportunity for individual cab operators to be entrepreneurial, “ Weirich says. “This is progress. This is innovation. This is everything we tell the world Milwaukee wants to be.”
Milwaukee, in short, is about to become a capitalistic battleground between traditional taxis, Uber and Lyft. I’ve already written about Uber, which launched in 2009 and serves some 65 cities world-wide. It has been touted as one one of the world’s fastest growing companies and has attracted billions in investment.
Like Uber, Lyft is based in San Francisco. It launched in the summer of 2012, but has already attracted $333 million from investors and now serves 32 cities, including Milwaukee.
Lyft held a launch event in Milwaukee on April 11 at Anodyne Coffee Roasters in Walker’s Point. “We love that Milwaukee has a tight-knit, small-town feel,” a company blog rhapsodized. “Lyft is all about community, too.” Its service will allow Milwaukeeans to “enjoy friendly rides from drivers who are community organizers, stay-at-home-moms, law school students, police officers, PhD candidates and more.”
Yet this open-door policy for all drivers was qualified by Lyft co-founder Logan Green in an interview with BusinessInsider.com, where he emphasized the safety advantage Lyft has over Uber and even other taxi companies. “With Lyft we run criminal background checks on every driver. We do a DMV check on every driver. We have a million-dollar insurance policy on every ride.” Logan says the company only accepts 6 percent of its driver applicants and any driver averaging less than a 4.5 star rating by users is dropped from the service.
To gain customers from Uber, Lyft currently takes a 0 percent commission on rides versus the 20 percent taken by Uber, Forbes magazine has reported, adding that “Lyft is literally losing money on each transaction.”
Then there’s SideCar, yet another startup based in San Francisco (it must be really easy to get a ride in that town) offering an online ride-sharing service company. SideCar actually launched before Lyft, in January 2012, but trails behind, with a mere $20 million in seed funding, and services in 12 cities. But chances are it will be in Milwaukee soon, and Ald. Bauman will be there to greet the company with a list of regulations. He has seen the future and it works technologically — and a lot quicker than just a month ago.
Short Take
Anthony B. Sanders, Attorney for the Institute for Justice, Minnesota Chapter, offered this reaction to Bauman’s plan: “The Institute for Justice welcomes Alderman Bauman’s realization that there should be no lottery on the American Dream and that the city’s cap on the number of cabs should be lifted once and for all. We also welcome the news that the city is interested in accepting ridesharing as a safe and affordable method of transportation. Any regulation of ridesharing, however, just as with the regulation of taxicabs, should only be made for true reasons of health and safety, and not in aid of economic protectionism.”
Any gloating perceived in this statement is purely in the minds of readers.
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“Any gloating perceived in this statement is purely in the minds of readers.”
Made my day!
I seriously had to read and re-read that one several times because I nearly fell out of my chair the first time through! Why? It has nothing at all to do with Uber or Lyft or that it looks like they’re actually going to finally get rid of the ridiculous artificial cap on taxis here, which like most government regulations of all sorts, accomplished nothing other than keeping taxi rates much higher than other cities, even much larger ones like Chicago. No, it was first reading that Ald Bob Bauman actually apparently had a sensible, realistic idea about something related to real world commerce, which was further compounded by a few more sensible ideas and the real shocker came when I reached the end of the article and hadn’t heard anything ridiculous, off the wall or anything that would only make sense in some sort of alternate universe coming from Bauman! I really had trouble digesting that whole concept, its something I would’ve never expected to see in my lifetime, that’s for sure!
Now that I’ve stopped hyper-ventilating and everything is back to normal, I can go on with my day. I won’t be expecting a repeat of this anytime soon however!
all this mind you as a St Louis Judge has ordered Lyft to shut the app down and a federal judge will be hearing yet another case in Houston on an expidited basis in Hosuton where it was revealed this after noon that despite a cease and desist order form the city Uber has completed 10,000 rides?
Wonder what the Texas Federal Judge is gonna do about the predatory business practices of Uber and Lyft that seems to want to be outl;aws west of the Pecos?
But oh yes there in Milwaukee? Ya’ll got some idea that Uber n Lyft are hunky dory right?
Stewart-I’m wondering what exactly you mean when you talk about “predatory business practices of Uber and Lyft”? Now, that’s a term I’ve always found to rather suspect to begin with. Sure, here and there you’ll find a business or group of them that really do act in a predatory manner, but often it seems to me that the businesses being called “predatory” are maybe somewhat dishonest or morally bankrupt, but the people they’re being accused of preying on, are just as guilty if not more so!
The “predatory lending” of the late 90’s and 2000’s is always one of my favorites. Sure, the lenders were far from honest and upstanding, offering crazy loans that anyone with half a brain knew would default big time if the real estate market slowed even a little and then they’d usually package and sell the loans off to buyers to wash their hands of any future problems, but the people borrowing the money were just as guilty, if not more so. When you get a home loan for far more home than you can really afford by blatantly lying about your income, assets, etc because incredibly no one is actually double checking what you’re claiming and then you’re foreclosed on after not making any payments for over a year, I hardly consider you a “victim” of a predatory business!
So, how exactly are Uber and Lyft predatory? Are people being forced into their “cabs”?
Slider what we are witnessing here is two very well funded corporate personhoods that are using their financial strength to deliberately ‘disrupt’ and another wise well regulated market place for profit.We read it all the time every where as their stated objective.
And how to they execute that strategy, they do that 1st in the example of insurance. As we also keepreading state after state city after city and county after county reuire proof of commercial for hire livery insurance that the TNC’s say they are provifding and that is patently false. What we know is that the indy drivers are running services on their personal lines insurance with their personal vehicles where in those policies clearly state the policy is null and void for commercial use.
In this example the TNC’s and their co conspirators, the indy drivers have an unfair business advantage by not being burdened by the costs of a commercial insurance policy which is more expensive. The sort opf policy that livery operations are compelled top carry in order to obtain permits to operate.
In market ploace after market place these TNC’s and their indy drivers do not apply for permits what so ever in direct violation of regs rules and laws governing for hir commercial livery operations, yet again an unfair business practice.
among those regs rules and laws are those chapters that govern fees for service, where in the example of surge (price gouging) pricing Uber and lyft reserve the right to charge what ever fees they feel they can get away with when ever they choose, be that a weather emergency, disaster or other event such as driver shortage due to hour of the day as was the case a in san diego where Uber was cuaght deliberately witholding drivers in the network in order to trigger a computer generated price surge on Valentines day.
And while you may say the consumer knew this pricing scheme was in effect, itdoesnt make it leagl. Other wise gas stations food store and pharmacies could charge 3, 4, or up to 7 times for essential goods and services during these sort of events and they are prosecutable under the law if they do. A predatory business practice.
As exisitng compliant for hire livery commercial operators abide by criminal background checks under the exisitng parameters, Uber and Lyft who do their own background checks, is a little like letting the fox check the chickens at night, and as they have done these in numerous instances we rwad that their background checks have failed to vet convicted felons and others who would not have been permitted to operate had Uber and Lyft obeyed the regs rules and laws when it comes to police agency background checks, drug screens and random drug screene there after that Uber and Lyft simply ignore now. Where as these cost current compliant operators cold cash and Uber and Lyft refuse to submit to these checks yet another unfair business practice exists.
In yet another example existing compliant livery services are required by the regs rules and laws to accept any call from any segnment of the community wehn Lyft and Uber deliberately cherry pick which communities and parts there of they choose to or not choose to serve. A predatory business practice yet again.
When it comes to discrimination the TNC’s do not have one handicapped vehicle in their network nor do they have a systemt to accomodate the disbaled such as wheel cahir bound individuals or or oters with special needs that include the use of seeing eye dogs in several well documented examples Uber and Lyft have declined services, as existing fully compliant fully insured operators have in place a methodology to deal with the special needs of the community at large that Uber and Lyft simply exempt themselves form because it just doesnt raise their conciouness to serve the disabled, and unfair business practice in not only who they serve but in their hiring practices as well.
In San Franscisco and Los Angeles hundreds of citations have been issued to both Uber and Lyft drivers who drop off and pick up in these airports because these airports are both policed and administrated by airport authorities by legislative authorities that Uber and Lyft do not not recognize as exisitng fully compliant operators abide by under ‘Lanside Operations’ standing orders such as obtaing trip tickets from the airport authorities, by paying a per trip fee, and having a transponder and decal issued by the airports that every one doing business at thes eairports do have at an added expense to the operators that Uber and Lyft and their contractors once again exempt themselves from, yet another unfair business practice.
The list goes on and on in various and sundry nuances in not just the U.S, but also in Paris, Berlin, Brussells, Barcelona, and in countries like the Phillipines and China where their laws are being violated by a US based corporation.
But the thing that stands out glaringly is the lying that comes from the mouths of spokeholes from Uber and Lyft who present themselves before city councils like Houston and Seattle and when cornered for a yes or not response they never seem to be able to anser in one word and do not acknowledge the turth and that is that they do not #playbytherules that every one else must operate under and as Americans we pride out selves by that credo in not just sporting events or social justice but yes, in business as well, we do not go about using our financial strength to delibertaely under cut the other guy with artificial unsustainable pricing until the markest is disrupted and then impose pricing that recovers the cost of the covert campaign at the detriment of the consumers be they young and old alike healthy or disabled or every day people in a predatory scheme to extract profit Uber Alles.
And of course there is that silly little catch all thing called the R.I.C.O. Act.
*
You’re not fooling us, Uber! 8 reasons why the “sharing economy” is all about corporate greed
Or, how to make money for Silicon Valley venture capitalists while pretending to espouse progressive ideals
ANDREW LEONARD
http://www.salon.com/2014/02/17/youre_not_fooling_us_uber_8_reasons_why_the_sharing_economy_is_all_about_corporate_greed/
The Sheppard Law Group In Oakland California Descirbes Predatory Business Practices Thusly:
The current political climate has accepted, shielded, and in some cases promoted various predatory and often illegal business practices as legitimate means for generating company revenues and, thereby, satisfying investors’ insatiable appetites for profits. Some of these practices include saturating the market with unsafe products, making promises about products and services with no intention of fully honoring them, and creating one-sided, often hidden contractual provisions that create onerous obligations and set traps for unwary consumers. They primarily affect single income households, the elderly, and small to medium sized businesses. As a result of such ethically bankrupt practices, many well intentioned consumers find themselves facing foreclosures and bankruptcies, and exhausting their life savings in what are often futile efforts to extricate themselves.
Predatory business practices also hurt honest businesses as well as local, state, and federal governments. Honest businesses find themselves unable to match the false claims made by larger, better financed—albeit unethical—competitors. Consequently, many small and medium size businesses are unfairly driven out of the market. Local, state, and federal governments are, in turn, forced to absorb the slack in the economy caused by stagnant wages and rising unemployment. Resources that should be used to improve the public school system, increase access to medical care, and upgrade infrastructure are, instead, diverted to build prisons, increase the law enforcement ranks, and to provide temporary and often inadequate financial relief for displaced workers.
Our firm is committed to fighting business misconduct at the source. Accordingly, we offer a variety of consultation and legal services to individuals, and small to mid-sized businesses designed to help them avoid and/or economically, effectively and efficiently address costly anti-competitive business abuses. We also seek redress for harmful business conduct on behalf of large numbers of similarly situated consumers in the form of class actions.
New York’s Top Lawyer Is Investigating Whether Uber’s Surge Pricing Is Legal | Business Insider
Stew, by “well regulated” do you mean to say kept as an oligopoly with inflated prices, poor service, and unethical drivers that take advantage of out of town passengers? Because then we would agree.
And by “predatory business practices” do you mean buying off local politicians, intimidating newcomers to the marketplace, and denying that technology can bring in a newer better form of service? Because then we would agree again.
First off, I have to say that Andy’s comment is pretty much spot on, I’m no big proponent of Uber or Lyft at all, I very rarely use taxis here in Milwaukee, which is probably partially because of the ridiculous fares they get here, which is of course a side effect of the totally artificial cap on licenses.
Now, to respond to Stewart’s response, which I have to say one thing for sure, was certainly not lacking in detail! First off, the insurance issue, if correct is certainly a major problem but I really have trouble believing that’s the true case, unless everyone in charge of both Uber and Lyft, along with every investor and every advisor along the way is totally brain dead! If that’s really the case that the drivers are simply using their own personal use car insurance, well yes if there’s a major injury accident, the driver’s insurance company is likely going to attempt to be absolved of being held liable to pay for the paying passengers claims and although I’m not an attorney, I’d think they’d likely prevail in court. Even if they didn’t, most drivers carry at most $300k in liability. In a major crash with multiple passengers having serious injuries, $300k can get burned through very quickly. Of course, plaintiffs lawyers will ALWAYS go after the deepest pockets whenever possible, which in this case is Uber/Lyft and considering that they would’ve arranged the ride and at least theoretically were profiting from it, I’d sure as heck think that they’d be held liable as well. So, if its true that the only insurance is the driver’s personal use policy, Uber/Lyft would be getting its pants sued off with the first big crash! I find it VERY hard to believe that would be the case at all. Between the management of the company and the various major investors, who always carefully scrutinize any company they invest in, I just can’t see them leaving such a massive liability loophole like that.
Now, as far as your point about price gouging, if I own a store and I want to jack up my prices to some exorbitant amount, there’s no law against that. Here in WI, there is a price gouging law but it only goes into effect if the governor declares a state of emergency. So, if Uber/Lyft want to jack up prices for Valentine’s Day or whenever else, there’s nothing illegal about that. The consequence I’d certainly fear more anyway would be the reaction of my loyal customers upon finding out that I’d been manipulating prices like such, although honestly prices do vary based on demand in a multitude of businesses. Have you ever bought a dozen roses right before Valentine’s Day? You probably paid AT LEAST double what you would’ve paid a week prior and maybe more! That’s just simple supply and demand, the basis of economics!
The Uber insurance issue is real. In San Francisco, an Uber driver hit a 6-year-old girl and her mother in a crosswalk on New Years Eve. The girl died and the mother has run up over $500,000 in medical bills so far.
The car wasn’t carrying anybody at the time and wasn’t driving to an Uber call. Instead it was just driving around, running the Uber app, waiting to be dispatched.
Uber refuses to take responsibility, claiming that the driver was an “independent contractor”. At the time of the crash, Uber provided $1 million of insurance for its “independent contractors” but only when a paying passenger was in the car (which wasn’t the case here). Since then, Uber has added minimal insurance (limited to $50,000 per person) for other times. This $50,000 of coverage is much less than the $500,000 (and counting) racked up by the dead girl’s mother in San Francisco.
http://sanfrancisco.cbslocal.com/2014/03/14/uber-lyft-announce-insurance-policy-changes-following-fatal-crash-involving-rideshare-driver/
I like how the author takes the advisory from the institute of justice and twists it to make it ound as though the institute of justice actually supports lyft and uber. All they said was the city should remove the cab on cab company registration and vehicle permits. So instead of relaxing regulations on the number of cabs, milwaukee is going to allow hundreds of inexperienced, uninsured drivers to hit the roads sucking up only the busy taxi traffic on only key areas of the city and leaving 80% of the rest of the city out to pasture if they are too poor or too black as they have done in EVERY other city they operate in.
Lyft and uber arent even developed app companies for taxi operations. Their companies do not cover the drivers with any insurance, the drivers are never told they need to get livery grade insurance to drive, these apps force the customer to only use a credit card they have to keep on an account with either company and they offer zero SERVICE TO THE DISABLED.
Why not just remove the medallion system, make sure the drivers have proper insurance and make sure cabs offer service to everyone without discrimination or limiting payment options like Madison’s system?
Madison has the lowest operating fees and the lowest cab prices in the country.
Lyft and uber have racked up MILLIONS in unpaid compensation to people and the families of those that their drivers have injured and killed because thir service terms have so many fraudulent loopholes there is zero insurance to cover any incident. They strap their drivers with all of the liability and then tell the drivers they dont have to worrry about insurance upgrades to cover commercial transportation.
Lyft and uber dont even properly background check these drivers.
Basically, Milwaukee needs to get it’s head out of it’s ass.
Lyft and Uber are banned from operations here in Madison because they don’t just violate the law, they dump costs on victims and tax payers everywhere they go.
As the numbers of uninsured and inexperienced drivers grows, so will the incidents. Eventually someone will die and be left holding the back while the driver loses their coverage for lying to their company and Lyft and uber turn their back.
Then (as it has in every other city Uber and Lyft operate in) it will fall on the tax payers.
Not to mention your cab service will suffer. Since Uber and Lyft can discriminate, your actual cab drivers will be forced to as well just to keep in business.
They will also start using the apps to arrance rides like cabbies have done in Chicago.
But then they will realise that limiting people to only credit cards and agreeing to the terms these companies define will lose them a lot of options for tipping and force them to refuse service to a lot more people.
All fo this while better cab app companies in Asia and Europe are now releasing apps that actually require drivers to have permits, insurance and training as well as giving customers full options on payment.
Get ready Milwaukee, you’ve invited yourselves to one of the biggest tech bubble disasters this side of the 21st century.
andy, by well regulated I do mean that existing compliant livery services are heavily regulated, by predatory business practices you know exactly what I am refering to…
Ridesharing companies get Nebraska warning – Washington Times
http://www.washingtontimes.com/…/ridesharing-companies-get-nebraska-warning/
4 hours ago … On Monday the commission issued letters to Lyft and Uber, two San … that for ridesharing, “Uber maintains a best-in-class insurance policy in …
Big Liabilities For Uber, Sidecar And Lyft? – Forbes
http://www.forbes.com/sites/…/big-liabilities-for-uber-sidecar-and-l... – Similar to Big Liabilities For Uber, Sidecar And Lyft? – Forbes
Jan 8, 2014 … Accidents by Uber, Lyft and Sidecar drivers bring big liability questions for the … They are tech companies, they claim, and just take a fee for putting … They have their own insurance, but a serious or fatal accident can involve … There are many taxicab, limo and package delivery cases that raise this issue.
Uber, Lyft drivers and customers should be aware of potential …
http://www.crainscleveland.com/…/uber-lyft-drivers-and-customers-should-be- awar…
Apr 16, 2014 … E-mail alerts … The tech companies may provide liability insurance, but not other … with companies like Uber and Lyft to review their personal coverage … to be the standard-bearer on ridesharing insurance issues and look …
Drivers for Uber, Lyft stuck in insurance limbo – SFGate
http://www.sfgate.com/…/Drivers-for-Uber-Lyft-stuck-in-insurance-lim... – Similar to Drivers for Uber, Lyft stuck in insurance limbo – SFGate
Feb 2, 2014 … Drivers must have personal insurance, and the companies must carry $1 … Taxi advocates say it’s unfair that drivers for Uber, Lyft and Sidecar are … state Department of Insurance, which issued a warning to motorists about …
Arizona governor vetoes bill exempting Uber from insurance regulations
The Republic – 32 minutes ago
PHOENIX — Arizona Gov. Jan Brewer has vetoed a bill exempting Uber and other rideshare companies from the regulations that traditional taxi
OK, now keep in mind that as I mentioned, I rarely, or really I should say extremely rarely ever take a cab anywhere in the local area. I’d say that in the last 10 years, I’ve taken three or four rides at most. Before that time, I did take cabs maybe once every month or two, usually always at the end of a night on the town, knowing I shouldn’t be driving due to my booze consumption that night. It was probably about 10 years ago that I just tired of drinking more than a couple of drinks, so since then I only have a couple drinks at most when I go out and thus I’m fine to drive home myself, so no more cabs home! So, whether the city keeps the old artificial cap on cabs, adds more or just ditches it altogether really doesn’t matter to me. Same goes for Lyft, Uber and anyone else attempting to start a car service of that type, I really doubt I’d ever use one, so I really could care less if they are here or not. So, I’m not coming at this with any hidden agenda or cause here.
First off, this “sky is falling” or maybe more accurately “sky is going to be falling very soon if Uber/Lyft are allowed to operate here” tone to several of the comments is pretty over the top and is bordering on humorous at times! Believe me, I totally understand and agree with the concept that we do need at least some basic regulations for all sorts of different businesses in today’s world and as a business owner myself, I understand totally and have seen first hand how an unscrupulous business operator that just laughs at any rules and who operates solely to maximize short term income and couldn’t care less about anything else can cause real damage to everyone and chaos as well. That said, you guys really ought to lighten up a bit on your “end is near” tone. I’m not disputing at all that letting some fly by night car service that blatantly ignores any and all rules and regulations would certainly end up causing various problems but not the sort of apocalypse you seem to be insinuating!
Now, I’m unclear on a few things. I see it mentioned over and over about how if a car service chooses to only service certain parts of town and if they don’t offer full access for the disabled, that its somehow against the law. Now, I know that due to the Americans With Disabilities Act, they have all sorts of regulations regarding access to public places such as restaurants for one but does that cover a car service as well? As far as being able to pick and choose my coverage areas, is there seriously a law somewhere that mandates that? If so, that’s crazy! What if I have a small budget and just want to start up a car service for other people living on the east side? Why the hell would I be required to cover the whole city? Or is it the whole county? Whole metro area??
As far as the insurance issue, I see the comment and link above about the deadly crash in San Fran and its really hard to believe, but apparently true. That does really blow my mind that any company and especially one that apparently has many, many millions or even billions of dollars of investment capital backing it would skimp one bit on insurance coverage, let alone do what they apparently did and just go without it and then attempt to blame it on an independent contractor if and when something very bad did happen. That’s just crazy for several reasons, one that its already been at least 15 years or more since the IRS cracked down big time on the whole “independent contractor” racket. They were mainly doing it to stop all of the uncollected taxes they lost out on every year when for years, many less scrupulous businesses would just claim that the people working for them who were by any measure their legal employees and thus subject to tax withholding, etc were just independent contractors and then they didn’t think they were required to withhold taxes, pay the employer contribution to SS and medicare, etc Well, back in the 1990’s the IRS finally wised up to that trick and cracked down hard so that these days, if you own a business and are paying regular payouts to someone you’re calling an independent contractor, they damn well better really be one! So, it sounds downright crazy to me that Uber or Lyft, which both have all these big time, big money investors, which also means that those investors will be sending their analysts over as well and they’ll be going over your operations with a fine toothed comb because these monster hedge fundsand other big time investors don’t just throw big money at any biz that sounds like a good concept and then just hope for the best as far as how that biz is run, they get in there and they look at it close!
I was with a group of friends earlier this month. We had reserved a cab ride weeks in advance. After the cabs were already 25 minutes late (and called to tell us they should be there in only another 20-30 minutes), we looked up Lyft. It was fast and convenient and still got us where we were going faster than the cabs which had a huge head start. Anything to upset the cab industry around here is a positive for me. It is worse than useless.
East Sider, the reason many of the posts seem so over the top in opposition to rideshare services is because they are people connected with the transport industry and these services go directly against their businesses/associations. You can google them since they are so kind as to provide their full names.
Unfortunately for them, their disregard for the problems of the taxi services in Milwaukee is causing their arguments to not only fall on deaf ears, but also actively turns would-be neutral parties against their cause.
oh andy, there you go again, its all those transportation people who #playbytherules they are given to operate with that disdavantages the venture capiltalists form the silicon valley…po-po big money folk that just cant catch a break nationwide in every city they have been issued cease and desist orders?
You’re not fooling us, Uber! 8 reasons why the “sharing economy” is all about corporate greed
Or, how to make money for Silicon Valley venture capitalists while pretending to espouse progressive ideals
ANDREW LEONARD
http://www.salon.com/2014/02/17/youre_not_fooling_us_uber_8_reasons_why_the_sharing_economy_is_all_about_corporate_greed/
Sorry to say it, but the cab situation in Milwaukee is pathetic. With some exceptions, I’ve consistently found issues with cabbies who are surly and negative, throw absolute fits about passengers who aren’t carrying cash for a ride, can’t be bothered to accept a ride if it’s called is as a credit card fare, either don’t know or care to follow the most direct route to a destination, and frankly, couldn’t hold a candle to an experienced cabbie in Chicago or NYC.
I’ve lived in both and I know the difference between a professional and a hack. And there are an awful lot of hacks in Madison and Milwaukee. Funny how some of them seem to pop up on these boards bitching about illegality.
Having a union who whines to an alderman doesn’t make Uber or Lyft in the wrong. And spouting about the driver who hit a child in SF? Oh, you want to tout a tragic death? About how taxi drivers are the mecca for safety? Please read on:
http://nypost.com/2014/01/10/man-child-killed-in-separate-accidents/
http://www.nj.com/monmouth/index.ssf/2014/04/brielle_woman_22_killed_after_being_struck_by_2_nyc_taxis.html
or this winning example of taxi society? http://www.complex.com/rides/2014/02/new-york-cabbie-attacked-woman-for-not-having-cash
Predatory? Please…you have a weak system with garbage ethics that does a piss-poor job. Suddenly, you have competition based on people who want drivers that show up when they’re supposed to, don’t price-gouge, don’t spend the entire ride talking into a blue-tooth in a language they can’t understand, have clean vehicles, have a personality….and you think that regulations are going to save you? People don’t like the service that cabs have been offering. Not having to settle for something inferior is what drives people to new things.
Also, Justin has no idea what he’s talking about beyond the same regurgitated arguement that two other accounts keep spewing in Madison talk-threads (same guy maybe?), so I’m guessing he’s a LaPlante for the cabbies. The “unpaid millions” are more than an exaggeration (and also ignores how many lawsuits are levied against taxi drivers, companies and their associates every year), stating that background checks are not performed is an outright lie (or mis-statement assuming you just have no idea what you’re talking about), and complaining that the drivers don’t go to “certain areas” is also entirely incorrect. The city as a whole gets coverage. I’ve found rides from Lyft when looking in Riverwest, west of Marquette, Glendale, South Milwaukee and points in between. Compare that to a cab service like American or Yellow who “lose” my called in requests or just never happen to be driving in the area.
Sorry, but taxis will continue to lose out as the system they drive for continues to keep it’s head in the sand over cleaning up and improving the level of service provided.
Andy, We tend to use our real names unlike advertisement plants who work for Uber and Lyft who bait and troll articles. I post my full name very proudly in this matter. I was working with the BBB, US state dept and Wisconsin state consumer protections six years before I ever got in a cab. Lyft and uber are no different than any other confidence scam I’ve helped the state eject. You would have to be a moron to get into a cab “service” that has no insurance coverage for anything that may happen to you while you use it.
James Fallon, excellent post. That is just about the best comment I’ve seen yet on this topic related to Uber/Lyft coming to Milwaukee.
Justin La Plante, that’s great that you post your real names so people can internet stalk you. What would be better is if you just outright state you affiliation so no one has to do that.
That being said, you may feel someone must be a “moron to get into a cab ‘service’ that has no insurance” but lets remember two things. First, as James Fallon has said, you are overstating the insurance situation (not to mention taking liberties with the idea that cab insurance will just automatically pay for any situation without a fight as well). Second, since getting a traditional cab in Milwaukee is so difficult, and even when you do the service is so bad, many people really have no other options. Call them a moron if you will, but when it’s a person’s only real option… what do you expect them to do?
Get your industry up to some sort of acceptable standards and you won’t have to worry about the competition from these new rideshare services.
WHY CORPORATE TRAVEL MANAGERS SHOULD AVOID UBER
Unacceptable and Unnecessary Exposure to Adversary Litigation
Dear Travel Manager:
When you arrange transportation for a client, employee, visitor
or family members of any of those, you not only have an implied
obligation to perform due diligence in selecting the service, but
a direct and specific obligation and responsibility for their safety.
That Town Car transporting your people is in fact an agent of your
corporation acting on behalf of and at the direction of your department.
Anything and everything that may happen will be your complete and
total liability and responsibility.
When you sign a contract with UBER, you specifically acknowledge
that UBER accepts no liability or responsibility for anything that
happens, and further that the transportation arranged may be in a
vehicle that is unlicensed, unsafe or unsuitable for the transportation
of children. (Exact words)
Exposure to Risk 1) Let’s say you have a visitor, a high-level attractive
female executive from a company whose account you are eager to secure.
This is an actual account of a woman’s experience of being raped by
an UBER driver: (Want him to drive for your client?)
Uber Driver Arrested For Rape: Anouar Habib Trabelsi Arrested, Not Charged With Sexual Assault Of Female Passenger In Washingt
Exposure to Risk 2) An UBER Town Car transporting your employee
on an official company trip to make a presentation is involved in a
fatal accident en route, similar to the one below, (Scroll down) where
a six year old girl was run over and killed by an UBER driver and her
mother was grievously injured and has needed several operations.
Her medical bills so far exceed $650,000.
UBER’s insurance has proven to be ineffective at best and evasive
and worthless in several instances. The attorneys for the families of
the people killed will not waste much time in discovery determining
who was leasing the car and directing it at the time of the accident.
If that happened to be your corporation, you will experience some
enormous bad publicity and a huge settlement that goes to the favor
of the people injured and killed by YOUR CHOICE of transportation.
PLEASE READ THE ENTIRE EMAIL, ALL THE WAY TO THE BOTTOM
First, let’s look at the advantages of using an established, licensed
Limousine Service instead of a freelance UBER person using his
family car or SUV to make beer money on the side.
1) Insurance. Limousine companies are required by law to have
first-dollar coverage and be in effect 24/7/365.
You can have your company listed as an additional insured on
these policies. (Impossible with UBER).
2) Chauffeur Background Checks. Again, by law, all chauffeurs and
drivers for regular licensed services have mandatory and regular
drug tests, fingerprints and full FBI background checks.
(UBER does none of that)
3) Distracted Driving. Professional chauffeurs know the city and know
where they are going before they pick you up. An UBER driver is always
watching his UBER smartphone screen and his GPS instead of the road.
4) Hours of Service. Is your UBER driver nodding off from lack of sleep?
UBER has no oversight of its contracted vehicles in the field. Again,
regular licensed services are regulated by law and their drivers can
only work a certain number of hours per day.
5) Licensed Chauffeurs. Licensed companies are required by law to have
chauffeurs get Chauffeur Licenses and/or Commercial Driver Licenses
(CDL’s). UBER’s only requirement is a plain vanilla basic driver’s license.
Again, did YOU perform due diligence in selecting safe transportation
for the people you are responsible for?
READ MORE: This stuff is real IMPORTANT.
6. The UBER Insurance Umbrella Revisited
Uber, on behalf of UberX, has conducted a major media blitz claiming an umbrella insurance coverage that drops down to cover drivers and/or passengers in the event of an accident when the TNA operator’s insurance carrier denies coverage. Uber has labeled this coverage as the best in the industry. Uber fought public release of all but the most elemental provisions of this supposed elaborate and generous coverage, and then only under cloaks of secrecy to select public officials. However,
any search of the literature turned up dire warnings to the public about the reliability of such policies. Indeed, the noted local legal scholar, Gail S. Kelley, pointed out in a July, 2013 article in Structural Engineering Magazine that the drop down coverage of an Umbrella policy was generally denied when the underlying insured failed to comply with the provisions of the underlying policy. This is exactly why coverage was being denied for the private vehicles being used in livery services. And Regulators from both the California and Ohio had issued stern warnings of gaps in liability coverage by the drop downs of the Umbrella policies carried by the likes of Uber and Lyft.
The shroud of secrecy was lifted when an anonymous source sent the San Francisco Bay Guardian a copy of the Uber Umbrella policy issued by James River Insurance Company (JRI). The S F B Guardian immediately published this copy of the Uber policy on the web for public viewing. Some of the early comments were of interest. Ohio Insurance Director Mary Taylor stated in a consumer alert issued on April 16th that “While TNC’s may provide liability insurance, they may not provide medical payments coverage, comprehensive, collision, uninsured and underinsured motorists coverage, or other types of coverage to fully protect the TNC drivers and passengers”. Amy Bogner, a spokesperson for the Florida Office of Insurance Regulation, issued concerns stating “We are looking at solvency of companies – if they have enough surplus to pay out claims”. Finally, John Madiedo, president of the Professional Insurance Center in Tampa, pointed out that the supposed Uber Umbrella policy was secured through a series of shell corporations, all with the first name of Rasier, none of which had any assets and none of which had contracts with any of the Uber drivers. According to Madiedo, “Rasier doesn’t do anything: it has no drivers … It’s a ring around the rosie”. (See “Some Doubt Ride-Sharing has it Covered Liability Wise” by Mike Salinero, Tampa Tribune, April 20, 2014). JRI is frequently referenced in the Financial Media as a ‘start-up’.
According to published media reports, Uber is moving quickly to fill gaps in the alleged deficient policy it has so publicly touted as the best in the industry. Based upon the above warnings, most notably those published by Salinero, a cursory review was conducted of the published Financial Statements of James River Insurance Company (JRI), and the policy issued to the Rasier, LLC’s on behalf of Uber. While these comments are neither definitive nor exhaustive, they should shed light on exactly how the public may have been misled by Uber.
JRI is a Commercial Excess Casualty Insurer with a home address in Richmond, Virginia. As a casualty insurer, JRI is not authorized to issue insurance on private non-commercial vehicles. JRI is privately held by the offshore Bermuda Corporation, 055488 Franklin Holdings. Offshore Corporations are often known for being difficult to attach assets in the event of a dispute.
JRI had total assets at EOY 2013 of a mere $470.2 million. In comparison Geico, who is authorized to issue insurance policies on private, non-commercial vehicles, had total assets at EOY 2013 in excess of $28 billion. JRI had a credit rating issued by Best of A- compared to that of A++ for Geico. While this may appear to be a comparison of apples and oranges, one is reminded that Geico is nothing more than our little home grown company located out on Western Ave.
As Casualty Insurer, JRI’s primary revenue source is expected to be insurance premiums. In 2013 JRI wrote $35.9 million in insurance premiums. This is down from $41.5 million written in 2012, a decline of 18% in one year.
The Web published copy of the policy issued on behalf of Uber by JRI had the premium amount blackened out. However, an examination of the detailed schedules to the JRI financials sheds some interesting parameters on what that policy appears to have cost Uber. In 2013 JRI had premiums written of $568,669.00 for “Commercial Auto Liability”. In 2013 JRI further wrote premiums of $2,924.00 for a commercial category “Auto Physical Damage”. This is a combined total of commercial auto premiums written for JRI of $571, 593.00 for the year 2013. No premiums were written for any category of auto coverage by JRI in 2012.
It may be reasonable to infer, given that the issuance of a Commercial Auto Insurance Policy by JRI is new to JRI in 2013, and that the Uber policy was priced at an upper limited of $571,593.00 dollars. In order to understand the absurdity of such a minimal premium, this premium would cover the total premiums on DC’s estimated fleet of 7,000 taxicabs for little more than two weeks. UberX is alleged to have had 7,000 vehicles in operation in the Metro area at the end of 2013 and currently an estimated 10,000 vehicles. Nationwide, it would be reasonable to infer that Uber now dispatches an estimated 45,000 UberX vehicles. At DC Taxicab insurance rates, an annual premium of $571,593.00 would provide coverage for the nationwide Uber fleet for about 3 days, not a full year.
While attempting to read an insurance policy is like swatting at bats in the dark with bare hands, a couple of interesting curiosities did emerge. First, the Uber policy drop down is not a million dollar drop down. The drop down is $50K for an individual with a total of $100K per incident for bodily injury; and a $25K per incident for property damage. This carries a $1,000.00 deductible. Second, JRI will pay only after the liability limits under any liability bonds or policies have been exhausted by payments of judgments or settlements. This appears to suggest that any party processing a claim has a long road to travel before they can access the JRI coverage. Third, any judgment for damages arising out of a ‘suit’ brought without JRI’s written consent is not binding on JRI. A plain language reading of this suggests that to seek recovery of damages against JRI, you have to have JRI’s written consent to sue JRI. How convenient. Fourth, any suit brought must be served on the Company Attorney in Sacramento California. How convenient for the residents of the District of Columbia.
It is difficult to conclude that the fantastic Uber Umbrella drop down policy is anything more than a sham. Similarly, the Lyft and Sidecar policies need to be made available to the public and subjected to public scrutiny. In any event, none of these policies should serve as a starting point for mandating insurance coverage applicable to any ‘for hire’ vehicles permitted to operate on the public roadways of The District of Columbia.
MORE SERIOUS QUESTIONS ABOUT UBER INSURANCE:
The Situation in Illinois:
Very few of the Illinois Senators bought or even understood why Uber, Lyft and Sidecar didn’t want coverage when someone was essentially working ” app on “to ” app off”. The California situation with the Uber defense in the little girl”s case was not appreciated. Also, no one understands why these guys don’t want drug testing.The safety issue trumps all in our fight. Even the Libertarians agreed on the safety issues. After all everyone is worried about their kids in these cars. The legitimacy of the Uber insurance policy was brought into play. First because of the waivers everyone signs and then because the James River annual report for 2013 points out that they took in only 2.5 million in premiums for commercial cars which is very strange given that these guys have over 60,000 cars on the road or around $41.00 per year for insurance premiums.The same report also pointed out that James River paid out only $33,000 dollars in settlements in 2013. If the policy is like any other and has real coverage these numbers would not be anywhere near the coverage results. In Chicago alone, for 6800 taxis the Insurers pay out around $30,000 per day.So something is clearly wrong with this policy.
In any event, I am at 239 514 7329
Pat Corrigan
Yellow Group
Chicago
————————————————————————————————————————–
KEEP READING:
UBER FATAL ACCIDENT: Points of Law
There are several points of law that need to be looked at in the wake of
the tragic accident on New Year’s Eve when six year old Sophia Liu was killed by a negligent UBER driver who has since been indicted on Felony Manslaughter by
Auto charges.
UBER DENIES ANY RESPONSIBILITY. Here is their official statement:
http://sfcitizen.com/blog/wp-content/uploads/2014/01/Capture2-copy.jpg
UBER ACCIDENT SCENE PHOTOS
http://search.aol.com/aol/image?q=sophia+liu+san+francisco&v_t=comsearch51
VICTIM’s FAMILY WANTS UBER TO PAY. Also Memorial Fund details
http://abclocal.go.com/kgo/story?section=news/local/san_francisco&id=9383769
FIRST POINT OF LAW:
UBER says they are not liable for the fatal accident because they didn’t have
a paying client in the back seat at the time.
This is like “Cracker Jack Box” Pizza delivery insurance. Little or no liability.
(More on this later).
In actuality, UBER has no insurance. The California PUC ordered them to have one million per incident, but UBER has “Appealed” the decision.
Here’s the deal: Limo Operators found out the hard way on a Department of Labor ruling that if a chauffeur takes a Town Car home in order to do an early morning run, if he is “Subject to doing a job” then he is on the clock and must be paid overtime and be subject to Hours of Service for CDL drivers and/or crossing a State Line.
So, using this legal precedent, any UBER driver is “Subject to doing a job” by
virtue of being in permanent possession of an UBER-Issued phone. UBER needs to have (Like the rest of us) 24/7/365 Active Insurance OVER AND ABOVE any insurance the car and driver may have.
If any California operators know a good Personal Injury attorney, they should refer them to the Liu family. Uber has a net worth of $4 billion and posted an after-tax net income of $275 million last year, a very sweet plum ripe for the plucking.
SECOND POINT OF LAW
Uber says they “Have a zero tolerance policy on drugs” and that “Our drivers are thoroughly background checked before we hire them”.
TOTAL LIES AND BS
In the article below, it is factually documented that UBER Driver Daveea Whitmire was a convicted felon and had done in time in prison for being a drug dealer and had a long rap sheet. It went on to say that former California regulators were appalled that UBER was allowed to use Hirease for a $15 one-click criminal background check instead of the full FBI/DOJ Livescan with fingerprints and NCIC checks.
Under the loosely-written California PUC Regulations, UBER could even do an in-house one phone call to the sheriff. The California PUC regulations on UBER are like letting the fox guard the henhouse. Anything goes. Neither UBER nor Lyft have ever drug tested or fingerprinted a single driver anywhere in the USA.
Take the time to read this article. It will dispel any delusions you may have about
UBER’s “Thorough background checks”.
http://pando.com/2014/01/06/exclusive-uber-driver-accused-of-assault-passed-zero-tolerance-background-check-despite-criminal-history/#!
THIRD POINT OF LAW
UBER says “We are just an APP and not liable for the actions of our drivers”
Not so. In the following article in FORBES magazine, it is pointed out that Dominos Pizza lost a $32 million dollar lawsuit when a pizza delivery boy hit a car and killed the wife of a man and permanently disabled the husband. The jury decided that the pizza delivery boy was driving excessively fast to stay in compliance with the national chain order of “All pizzas must be delivered in 30 minutes”. UBER drivers must arrive precisely when Google Maps says they “Could” not taking into account weather or construction delays. Drive fast or get a bad review. Exact same legal precedent. Read the article, get educated.
http://www.forbes.com/sites/robertwood/2014/01/08/big-liabilities-for-uber-sidecar-and-lyft/
FOURTH POINT OF LAW
California Texting While Driving Law
The driver in the fatal accident may well have been texting UBER at time he killed Sophia Liu. Real Limousine Chauffeurs go from job to job with full knowledge ahead of time from their dispatcher. UBER drivers drive aimlessly around belching emissions and clogging traffic while waiting for a “Ping” from UBER and then their eyes are glued to the phone while they compete for the run while they are zooming down the Ventura Freeway. Was he texting UBER? In your lifetime you will never know as everything UBER does is highly encrypted and no one in authority in California has the cojones to ask to see the records. Bad, bad, bad.
http://www.dmv.ca.gov/cellularphonelaws/
FIFTH POINT OF LAW
ARE DRIVERS EMPLOYEES OR INDEPENDENT CONTRACTORS?
UBER’s Travis Kalanick is a known lawbreaker and tax evader so it would make sense he would claim all drivers as Independent Contractors. He also gets to ignore FICA, witholding, Obamacare, Workers Comp, Hours of Service, etc, etc.
Could all his drivers pass the 21-Point IRS Independent Contractor smell test? I don’t think so. If you go a whole year and work only for one person, you are an employee. UBER specifies appearance, behavior and service levels and that is micromanagement. UBER is even “Arranging” for drivers to buy cars from them. FEDEX Ground found out the hard way about that mis-step.
Why does USDOT, USDOJ, IRS, FMCSA, FTC all give UBER a “Get out of jail free card”? Does anybody but me smell a rat?
SIXTH POINT OF LAW
UBER: “We are not a transportation Service, we are just an APP on a telephone”
Well, let’s see:
1) UBER inspects vehicles
2) UBER runs (Sort of) background checks on drivers
3) UBER specifies level of service, appearance and behavior
4) UBER advertises for customers
5) UBER collects the money and pays the drivers
6) UBER dispatches specific vehicles and designates routes
7) UBER fires drivers for bad service (Or trying to organize or complain)
Seems like Danny DeVito did all this during the TV Show “Taxi” in the 70’s.
That was a transportation company. How is UBER any different?
SEVENTH POINT OF LAW (The real law!)
In the wake of the terrible tragedy of UBER’s killing of a six year old girl, UBER CEO and multi-millionaire Travis Kalanick loudly denies any responsibility whatsoever even as the police report at the scene is still being written on the clip board.
ARE THERE ANY WOMEN in Travis Kalanick’s life? Apparently not. Most of the mothers, wives, sisters and daughters I know would be slapping his face so hard he would be knocked across the room while they demanded he stand up and act like a man and take responsibility for this grotesque monstrosity of a transportation service he built that resulted in the death of a six year old girl.
Travis Kalanick is the poster child for all that is wrong with corporate America.
Greed, corruption, bribing of public officials, falsifying public documents, lying to Federal Agents, egregious abrogation of responsibility, he operates as an incorrigible reprobate in a pervasive moral and ethical vacuum. Need another example of the completely socially irresponsible scum that UBER is? Neither UBER nor Lyft have even one wheelchair accessible vehicle anywhere in the USA.
I encourage you to go see the movie “Wolf of Wall Street”, based on actual events.
When you see the main character Jordan Belfort (His real name) lying, cheating and stealing, you can blink your eyes and see Travis Kalanick. There were scenes
of wild parties at the stockbroker’s office. Go to UBER’s Facebook page and see
his employees dancing the “Baker” at UBER HQ in San Francisco. Life imitates art.
FINALLY, The Biggest Understatement of 2014 (So Far)
UBER, Lyft and Sidecar need more regulation (Really?No)
http://m.sfgate.com/opinion/openforum/article/Uber-Lyft-and-other-ride-sharing-services-need-5129399.php
Hope all this has been helpful. Please share with all your limo buddies and any
regulators who have not been bought off yet. Getting UBER in your marketing area is like getting Aids, Herpes, Malaria or Tuberculosis