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UberCab Ordered to Cease And Desist

October 24th, 2010 10:19 admin Leave a comment Go to comments

Did Ubercab just crash and burn? Taxi and limo industry insiders in California today informed TechCrunch that the city of San Francisco has ordered the startup to cease and desist. We reached out to the company for comment. They did not respond but posted the following information to their website:

UberCab Inc. has been issued a cease and desist order from the SF Metro Transit Authority & the Public Utilities Commission of California. While we are looking into the issues raised, we believe that the service we offer is in compliance with the cited regulations.

UberCab is a first to market, cutting edge transportation technology and it must be recognized that the regulations from both city and state regulatory bodies have not been written with these innovations in mind. As such, we are happy to help educate the regulatory bodies on this new generation of technology and work closely with both agencies to ensure compliance and keep our service available for our truly Uber users and their drivers.

Our commitment is to facilitate an improved transportation option that provides safe, reliable, and convenient travel. That will not change. We will continue full speed ahead with the mission of making San Francisco city a great place to live and travel.

Ubercab’s mobile apps let users request a car service to pick them up wherever they are right now, and let users pay for that car service with their phones. The startup takes a cut of the money made by drivers to generate revenue. Earlier this month, Ubercab closed a $1.25 million angel investment led by First Round.

That was despite the fact that the San Francisco taxi industry has been rumbling about whether its business is legal since September. A concerned driver brought the matter up at a Taxi Advisory Council meeting, reported The Phantom Cab Driver Phites Back blog.

The old taxi industry’s concerns include the following:

    Ubercab operates much like a cab company but does not have a taxi license.
    Its cars don’t have insurance equivalent to taxis’ insurance.
    Taxi dispatchers make money on tips. Ubercab threatens dispatchers’ way of earning a living.
    Limos have to prebook an hour in advance, only licensed taxis can pick someone up right away by San Francisco law, yet Ubercab picks people up right away, yet doesn’t have a taxi license.

Source: UberCab Ordered to Cease And Desist

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