LOS ANGELES — Uber — plagued by problems with regulators, drivers and taxi unions around the world — took a big blow in its home state Wednesday when an administrative judge recommended that the ride-sharing giant be fined $7.3 million and be suspended from operating in California.
In her decision, chief administrative law judge Karen V. Clopton of the California Public Utilities Commission contended that Uber has not complied with state laws designed to ensure that drivers are doling out rides fairly to all passengers, regardless of where they live or who they are. She said Uber’s refusal to provide such data is in violation of the 2013 law that legalized ride-hailing firms.
Uber said it would appeal. Whether the fine and suspension are enforced will depend on the appeals process, which could take several months.
“They had a year to comply with these regulations, and didn’t do it,” CPUC spokeswoman Constance Gordon said.
Uber competes with the taxi industry by contracting with drivers and connecting them with passengers through a smartphone app.
Clopton wrote that her proposed ban would remain in effect until Uber “complies fully with the outstanding requirements.”
The reporting requirements include the number of requests for rides from people with service animals or wheelchairs; how many such rides were completed; and other ride-logging information such as date, time, ZIP code and fare paid. For Uber, which has raised $5.9 billion in venture capital investment, a $7.3 million fine would amount to less than 1 percent of that. A suspension, however, is another matter.
In a prepared statement, an Uber spokeswoman called the decision “deeply disappointing.”
“We will appeal the decision as Uber has already provided substantial amounts of data to the California Public Utilities Commission, information we have provided elsewhere with no complaints,” spokeswoman Eva Behrend said. “Going further risks compromising the privacy of individual riders as well as driver-partners.”
The decision was applauded by Marilyn Golden, senior policy analyst at the Disability Rights Education & Defense Fund in Berkeley.
“This industry has done everything it can to avoid, dismiss and coerce themselves out of regulation, and this decision is welcome from that standpoint,” she said. “They’ve been scofflaws. They take every advantage and avoid every requirement.”
If the San Francisco company is suspended in its own backyard, it doesn’t bode well for the litany of issues it faces worldwide. The company has faced repeated pushback from taxi operators and regulators as it has expanded into more than 300 cities across six continents. In an attempt to win over skeptical local authorities, the company has touted its potential to create jobs, reduce congestion and boost tax revenue.
Wednesday’s decision was the latest run-in that Uber has had with government regulators. The company has become known for aggressively barreling into new regions without much consideration for existing rules and norms, and has subsequently faced widespread pushback.
Last month, hundreds of French taxi drivers took to the streets in a massive protest against Uber, blocking access to major airports and train stations, and attacking vehicles suspected of working for the popular car service, which they accuse of stealing their livelihoods. This month, Uber suspended its UberPop service in France following those riots.
Uber Chief Executive Travis Kalanick made the case in January that many taxis in Europe operate “off-grid” and that Uber could be a way to bring them into compliance with local safety regulations and tax obligations.
