Uber agrees to $28.5 mn settlement over safety claims

February 12, 2016
Uber lets customers use smartphone applications to summon and pay for rides provided by drivers using their own cars
Uber lets customers use smartphone applications to summon and pay for rides provided by drivers using their own cars

Uber said Thursday it has agreed to pay $28.5 million to settle a pair of lawsuits challenging its promises on driver safety checks.

The settlement submitted for approval in US District Court in Northern California called for the ride-share company to divvy up the cash between some 25 million customers and to "avoid using certain language in safety-related advertising as well as the term Safe Ride Fee."

"No means of transportation can ever be 100 percent safe," Uber said in an online post.

"Accidents and incidents do happen. That's why it's important to ensure that the language we use to describe safety at Uber is clear and precise."

The civil litigation challenged Uber's claim that it used "industry leading practices" to check backgrounds of drivers. It also took issue with how it used money taken in by a "Safe Ride Fee" added on to trips.

Under terms of the proposed settlement, Uber will rename the charge a "Booking Fee" that it said will be used to cover safety and operational costs as needed.

"We are glad to put these cases behind us and we will continue to invest in new technology and great customer services so that we can help improve in the cities we serve," Uber said.

If approved, those represented in the class action suits will get a choice to have their shares of the settlement money paid to credit cards or Uber accounts.

They include people who took Uber rides in the United States between the start of 2013 to the last day of January this year, according to the San Francisco-based firm.

Uber lets customers use smartphone applications to summon and pay for rides provided by drivers using their own cars.

The company made its billionth trip last month in a milestone for the global ridesharing service.

Uber has expanded to hundreds of cities around the world, offering new options for both riders and drivers but also running into complaints from the taxi industry and regulators.

The company has reached a valuation of more than $50 billion based on private investment disclosed to date.

Uber faces competition from US-based Lyft and other global startups.

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5 / 5 (1) Feb 12, 2016
My problem with Uber is the fact that it is a US based company that operates globally. The drivers get a slice of the take, the rest goes to Uber. Where in all of this are the local taxes being paid? The Uber drivers may or may not pay income tax but Uber itself pays no taxes in the foreign company it operates in, the cash goes to the US. The local taxi drivers/companies fully participate in the fees, taxes, permits etc while Uber runs an app on your smartphone and sends you to get the fare. There needs to be a way to have them pay taxes in the foreign contries it operates in. If not, they are simply a cash vacuum sucking the life out of other countries economies. No to Uber!
1 / 5 (1) Feb 12, 2016
The drivers get a slice of the take, the rest goes to Uber.

Actually, Uber gets a slice, with the most going to the driver. And the driver pays taxes on the income. Tell me how this is worse than taxi companies' practices, often where the taxi driver takes cash and pays no income on it? And where taxi fleet owners pay (in the form of campaign cash or other favors) politicians to restrict competition.

Frankly, I've found Uber to be a lot better than taxis. While I'm not a driver for either, taxi companies rent their cars to drivers forcing them to work the whole time, while with Uber drivers have a lot more flexibility. And as a user, I find it far easier to get a Uber ride, than getting a taxi.
not rated yet Feb 13, 2016
@forFreeMinds good update, thanks. I was not trying to espouse the virtues of the current taxi system and drivers, just the apparent lack of taxes in the Uber system. If the Uber system delivers the same revenues to Governments where they operate, I'm ok with that. If it's actually a siphon of cash to the US, then I'm against it. Time will tell. Keep in mind the ongoing push for the TPP. This treaty will undoubtedly increase the cash flow to the US with little the Canadian Gov't can do about it.

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