Uber Technologies Inc. sued the New York City Taxi & Limousine Commission to block an increase in rates it must pay drivers that was approved last month, calling them “dramatic, unprecedented and unsupported hikes.”
(Bloomberg) — Uber Technologies Inc. sued the New York City Taxi & Limousine Commission to block an increase in rates it must pay drivers that was approved last month, calling them “dramatic, unprecedented and unsupported hikes.”
The commission on Nov. 15 approved the first increase in fares since 2012, including increases in per-mile and per-minute rates for Uber and Lyft Inc. drivers. In a lawsuit filed on Friday in New York state court, Uber said it would be forced to spend an additional $21 million to $23 million a month if the rule goes into effect on Dec. 19, which it wouldn’t be able to recover unless it raised rider fares.
“Such a significant fare hike, right before the holidays, would irreparably damage Uber’s reputation, impair goodwill, and risk permanent loss of business and customers,” Uber said in its suit. The company said the commission suddenly switched to a “volatile inflation index for a one-time increase that makes no sense, and that is a drastic departure from the Commission’s past practice or any rational approach.”
The city didn’t immediately respond to requests for comment on the lawsuit.
Uber and Lyft driver pay rates will increase by 7% per minute and 24% per mile under the commission’s plan. A sample trip of 30 minutes and 7.5 miles will require a minimum payment of $27.15. The suit is seeking a court order declaring the increases invalid and to block their implementation while the litigation proceeds.
“With this latest rulemaking, on top of the annual inflation adjustment, the TLC is choosing to invent a new methodology that locks in this summer’s high gas prices in perpetuity with a ‘mid-year’ adjustment that takes place 12 days before the end of the year,” an Uber spokesman said in a statement. He added that the TLC “should have followed its usual annual adjustment and instituted a temporary gas surcharge when gas prices were actually elevated.”
The case is Uber USA LLC v. New York City Taxi & Limousine Commission, 160451/2022, New York State Supreme Court, New York County (Manhattan).
–With assistance from Jackie Davalos.
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