Home Business Uber Competitor Lyft Under Investigation

Uber Competitor Lyft Under Investigation

When you purchase through our sponsored links, we may earn a commission. By using this website you agree to our T&Cs.

Uber competitor Lyft is in hot water. Law firm Hagens Berman informed ValueWalk today that they are investigating the ride-share operator. The firm alleges that Lyft has not been conducting vehicle and driver checks and that it neglects some important safety protocols. The investigation so far sounds pretty similar to problems Uber has already been facing in Europe and even in some U.S. cities.

Lyft accused of ignoring cease-and-desist letters

The law firm also claimed today that the Uber competitor has been “knowingly ignoring multiple cease-and-desist letters” and hasn’t disclosed this information to its riders. Hagens Berman stated that its investigation revealed that Lyft doesn’t have the required permits, “adequate” insurance that covers enough to be in compliance with the law or even proper licenses for its drivers.

The firm also accuses the ride sharing company of registering with the departments of transportation in a number of states and not conducting background checks on its drivers or even proper safety checks for its vehicles.

“Our investigation shows that Lyft has blatantly ignored many laws and cease-and-desist letters from various cities and states, without informing riders,” said lead attorney Rob Carey in a statement. “It appears that in its haste to compete in the transportation market, Lyft has abandoned one of the most important protocols – rider safety.”

Lyft riders may be reimbursed

The law firm states that rides in several states may be entitled to reimbursement by Lyft if they were affected by any of the allegations. In fact, lawyers believe Lyft continues to operate illegally in several states and cities.

The company has said that even though it provides transportation services for a fee, it is a technology company that simply connects drivers and passengers rather than a passenger transportation company. As a result, Lyft claims that it doesn’t need to follow the laws which Hagens Berman accuses it of violating. The firm also stated that Lyft’s description of itself has been rejected by law enforcement and regulators, according to its investigation.

Lawyers with the firm urge riders who think they may be entitled to reimbursement to email them at [email protected].

Lyft case similar to Uber case

This lawsuit is similar to issues competitor Uber has been facing elsewhere. Uber said it will continue to operate in Germany and roll out services elsewhere in the European Union even though German lawmakers issued a temporary injunction on its operations. Later the injunction was lifted, but then after that, the ban was upheld in two of Germany’s major cities.

Both Lyft and Uber are under the gun in San Antonio right now. WOAI reported today that the San Antonio Transportation Advisory Committee will take up the issue today. The debate is whether drivers for both companies must have background checks, vehicle inspections and drug tests.

Our Editorial Standards

At ValueWalk, we’re committed to providing accurate, research-backed information. Our editors go above and beyond to ensure our content is trustworthy and transparent.

Michelle Jones

Want Financial Guidance Sent Straight to You?

  • Pop your email in the box, and you'll receive bi-weekly emails from ValueWalk.
  • We never send spam — only the latest financial news and guides to help you take charge of your financial future.