Companies like Uber Technologies, Inc. are changing the way people get around -- especially in major cities. Things have been going so well, in fact, that numerous lawsuits have been filed just against Uber. The latest business litigation to make the Maryland news is a federal lawsuit filed by 15 taxi and limousine companies here on the East Coast accusing Uber of racketeering.
For those here in Maryland who are not yet familiar with Uber, it is one of several companies who market a ride-sharing application for smart phones and tablets. The application allows passengers to summon vehicles, and everything is done online. People no longer have to hail a cab or call a limousine or livery service in order to arrange transportation.
The Connecticut companies contended that Uber was guilty of unfair competition, misrepresenting its services to customers and trying to lure the plaintiff's drivers away from them. It was also alleged that the California company should be required to adhere to the same safety regulations and licensing requirements as they do. Uber, of course, denied the allegations and questioned how the state's transportation laws applied to it since it is a technology company, not a transportation company, and does not own any vehicles or employ any drivers. A federal judge recently dismissed the lawsuit, but gave the plaintiffs the right to refile the case.
Uber appears to be what every entrepreneur hopes for when starting a business. It started out small and quickly skyrocketed into a global phenomenon, which increases its exposure to liability along with its ability to increase profits. The company may not have immediately anticipated the amount of business litigation that would be filed against it, but it most likely adjusted its business plan accordingly. Hopefully, most small businesses will not endure the barrage of litigation that Uber has, but it is a consideration that needs to be explored so that it will not impede the growth and success of the company.
Source: Reuters, "Uber Scores a Win in Connecticut as Court Dismisses Racketeering Lawsuit", Jonathan Stempel, Aug. 14, 2015