Uber will pay at least $10 million to settle California prosecutors' allegations that the ride-hailing company misled passengers over the quality of its driver background checks.
District attorneys in San Francisco and Los Angeles sued in 2014, saying Uber falsely claimed its criminal screening of would-be drivers led the industry.
In fact, prosecutors say, Uber's background checks were inferior to what taxi drivers undergo because they don't include fingerprint checks.
In settling the case, Uber said it already has made many changes prosecutors sought. For example, Uber stopped claiming its background checks were the best available under a different settlement earlier this year.
A judge in San Francisco approved the settlement Thursday. The district attorneys' offices said if Uber doesn't comply, it would have to pay an additional $15 million.
Uber on Thursday provided the following statement to NBC Bay Area:
Today the Superior Court of California approved the terms of a settlement between Uber and the District Attorneys of San Francisco and Los Angeles. Uber has agreed to pay $10 million as part of this settlement, as well as to address a number of advertising and airport-related issues—many of which we have already dealt with.
Technology enables us to focus on safety before, during and after a trip in ways that were simply not possible before smartphones. However, no means of transportation can ever be 100 percent safe. Accidents and incidents do happen. That’s why we need to ensure that the language used to describe safety at Uber is clear and precise. So we’ve agreed not to use terms like “safest ride on the road” or describe our background checks as “the gold standard”. These commitments are almost identical to those we made as part of a class-action lawsuit settlement in February—and to commitments made by Lyft as part of their settlement with the district attorneys in 2014.
Operations at airports
We have agreed to allow ridesharing only at airports in California where we have explicit permission: SFO, LAX, BUR, SAN, OAK, SJC, SNA, MRY, SMF, SBA and MOD. In addition, we’ve changed the way we describe airports fees—as agreed in a class-action lawsuit last November.
California Division of Measurement Standards (DMS)
Uber will continue to work with the DMS, which last August certified our app as a reliable, accurate way to calculate fares using GPS data. The DMS also said that the app “meets or exceeds” the measurement for traditional taximeters. We are the only ridesharing app which has been approved by the DMS.
We’re glad to put this case behind us and excited to redouble our efforts serving riders and drivers across the state of California.
- As part of this settlement, we have agreed to pay $10 million, split equally between the SF and LA DAs. There is a $15 million penalty if we don't comply. The settlement is very similar to the case Lyft settled with the DAs in 2015. Here is more about Lyft’s DA settlement.
- There is no admission of wrongdoing or liability on Uber’s part.
- As part of the settlement, Uber has agreed to the following things we had already started doing
- Keep working with DMS. The DMS issued a 12 month permit in August to Uber after confirming that while the Uber App is not a taximeter, the software system “meets or exceeds” the traditional requirements of measuring distance and time applicable to taximeters.
- Avoid using certain language in safety-related advertising. Uber recently filed a motion for preliminary settlement approval for the private class actions related to safety statements and we have agreed to avoid using certain language in safety-related advertising (such as safest ride on the road or gold standard of background checks).
- Fees relating to Airport trips should be clearly described and disclosed. Uber settled claims related to California airport surcharges. (see Tadepalli v. Uber Technologies)
- Operate ridesharing only at Primary Commercial airports where we have permission. Uber has permits or permission to operate at airports under the DAs jurisdiction (SFO, LAX, Burbank), among other major airports in California (SAN, OAK, SMF, SJC, SNA).