LOS ANGELES (CN) – A class action accuses Uber of falsely advertising that it is cheaper than traditional cab companies.
Sennett Devermont used San Francisco-based Uber Technologies in Superior Court on Tuesday alleging violation of California’s unfair competition law. The case was the Top Download for Courthouse News on Wednesday and Thursday.
“Plaintiff has received advertisements from Uber and viewed advertisements provided to the general public regarding claims that Uber is 30 percent cheaper than a cab for specific routes. Based on his use of Uber, Uber’s statements are not true during certain peak times,” the eight-page complaint states.
Nor does Uber make clear that credits for customers who refer new business have an expiration date, Devermont says. It discloses that only after getting the referral.
A state administrative law judge on Wednesday recommended that Uber be fined $7.3 million for violating state laws and have its license suspended , pending an appeal or a California Public Utilities commissioner review.
State prosecutors are scrutinizing Uber and its competitor Lyft, both of which use crowd-sourced drivers who do not need a commercial license to drive for the companies.
Several class-action employment lawsuits are pending against the companies, and some cities in the United States and Europe have barred them as unfair competitors.
Smartphone users can submit a trip request to an Uber driver, and pay with a credit card on the app.
The California Labor Commissioner in June challenged Uber’s business model by awarding driver Barbara Berwick $4,152 in reimbursable business expenses and interest, finding she was an Uber “employee” rather than independent contractor. Class action lawsuits quickly followed.
Devermont seeks class certification, a preliminary and permanent injunction, disgorgement of profits, and general, special and consequential damages.
He is represented by Heath McKeon of Cohen McKeon.
Uber did not immediately respond to an emailed request for comment.
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