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Lyft, Uber not going anywhere despite fines

| Tuesday, June 10, 2014, 11:15 p.m.
ASSOCIATED PRESS
In this Jan. 17, 2013 photo, a Lyft car drives crosses Market Street in San Francisco. Fed up with traditional taxis, city dwellers are tapping their smartphones to hitch rides from strangers using mobile apps that allow riders and drivers to find each other. Internet-enabled ridesharing services such as Lyft, Uber and Sidecar are expanding rapidly in San Francisco, New York and other U.S. cities, billing themselves as a high-tech, low-cost alternative to cabs. (AP Photo/Jeff Chiu)

Ride-share companies Lyft and Uber said on Tuesday they would continue to operate in Pittsburgh despite big fines sought by the Pennsylvania Public Utility Commission, setting up a legal showdown with the state agency.

The PUC filed legal paperwork last week proposing fining Lyft $130,000 and Uber $95,000 for what the agency calls illegal operations since they started in February and March, respectively. The PUC fined 23 previously cited drivers $1,000 each. The commissioners would have to approve the fines before they are imposed.

The PUC asked PennDOT to revoke the registrations of the drivers who were cited.

Both Lyft and Uber spokespeople said their companies would cover the cost of PUC driver citations — including the $1,000 fines — and would continue to offer rides to passengers in the area. The companies and drivers have 20 days to respond.

“We ... commit to standing strong with drivers and passengers every step of the way, fighting any citations, covering relevant costs and making policy progress,” Lyft spokeswoman Paige Thelan said.

Uber spokesman Taylor Bennett said traditional taxi companies are holding up state approval of ride sharing.

“The PUC's recent enforcement action taken against drivers utilizing Uber's platform is disappointing. We have been working in good faith with the PUC to create a regulatory framework that allows for modern business models like ride sharing,” Bennett said. “Efforts to penalize drivers directly impact their ability to expand economic opportunities, create new jobs and contribute to the economy.”

Cited Lyft and Uber drivers could not be reached or declined to comment. The drivers were cited initially in April when a PUC compliance officer took a variety of rides from between March 31 and April 21, including pickups at the Wyndham Grand, Rivers Casino and Station Square. The citations were summary offenses filed with a magistrate with hearings set in September. The new fines would be civil penalties, PUC spokeswoman Jennifer Kocher said.

Both Lyft and Uber have applications pending with the PUC seeking approval. Several taxi companies from across the state have filed protests against the applications, records show. A date has not been set for a hearing.

“It's unfortunate that this is the approach we have to take in order to ensure the safety of the entire community,” Kocher said. “We have been telling (the companies) what is required to operate within the bounds of the law, but they chose to open and begin business, leaving us no choice but to enforce the law.”

Among the groups who opposed Lyft and Uber applications is the Insurance Federation of Pennsylvania, an industry group. Samuel Marshall, president and CEO, said most individual drivers have policies that exempt coverage if the policyholder is using the vehicle as a taxi. He said Lyft and Uber should make their insurance the primary coverage for drivers.

“It exposes our members to unanticipated, unaccepted and uncompensated liability expenses,” Marshall said. “That's an expense all of our policy holders will have to pay for.”

Bobby Kerlik is a staff writer for Trib Total Media. He can be reached at 412-320-7886 or bkerlik@tribweb.com.

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