Uber Faces $1.1M State Fine Over Intoxicated Driver Claims

Source: Law360

By Bonnie Eslinger

April 13, 2017

Uber is facing possible fines in California of more than $1.1 million over allegations from state regulators that the ride-hailing giant failed to investigate or promptly suspend drivers suspected of driving under the influence, according to an order issued Wednesday by the California Public Utilities Commission.

The state agency, which regulates private passenger transportation companies, announced Wednesday that it had opened a “penalty consideration case” against Uber for violation of “zero tolerance” rules it required of the company to protect the public against intoxicated drivers. Those mandates include a requirement to swiftly suspend a driver whom a rider suspects of being under the influence of drugs or alcohol in order to investigate the complaint.

“The CPUC’s Consumer Protection and Enforcement Division alleges that the company failed to either suspend promptly and/or investigate drivers after zero-tolerance complaints had been filed between Aug. 12, 2014, and Aug. 31, 2015,” the Wednesday announcement states. “The Consumer Protection and Enforcement Division recommends a penalty of $1,132,500.”

An order instituting an investigation into the matter, issued on April 11, states that a preliminary review of Uber’s compliance found that of 154 complaints received between August 2014 and August 2015, Uber failed to suspend and/or investigate drivers in 151 complaints. The recommended penalty is based on those 151 alleged complaints at a fine of $7,500 per violation.

Those complaints reviewed are only a portion of the 2,047 reports of intoxicated drivers Uber said it received during that 12-month time period. The company also told the CPUC that it deactivated drivers in 574 of those complaints.

But during its review of the 154 complaint sample, Uber could only provide evidence showing 22 instances of it suspending the driver within one hour of when a passenger filed a complaint, the enforcement division order states.

The CPUC’s preliminary investigation showed that in one instance, an allegedly intoxicated driver continued to be logged on to the app and available to accept rides for another two hours after he was purportedly suspended by Uber.

California’s “zero tolerance” regulations imposed on Uber and similar ride-hailing companies requires that notices be posted on their websites, mobile apps and riders’ receipts identifying ways to report an intoxicated driver.

The CPUC’s enforcement division noted that Uber doesn’t provide a method for a complainant to “flag” or identify a complaint as one pertaining to driving while under the influence, meaning it initially gets put into the general queue of complaints until an Uber staffer reviews the concern.

“The flaw with that approach, however, is that a driver will not be suspended until [Uber] has reviewed and categorized each individual complaint and identified those that involve DUI allegations,” the order states.

This is contrary to the requirement that a driver be suspended promptly after the complaint is filed, the order states.

The enforcement division order also expressed concern about Uber’s “problematic” methods for confirming intoxication allegations: driver admission, DUI arrest/conviction, a blood alcohol test from law enforcement showing an intoxication level over the legal limit, and video or other evidence demonstrating the driver was under the influence.

The problem is compounded by the fact that Uber does not appear to contact the driver in the majority of instances following a complaint, regulators said. Of the 154 complaints the CPED reviewed, Uber only attempted to contact a driver in 50 such instances, the order states and, of those contacts, state regulators identified only 21 instances where Uber conducted its “any sort of driver investigation, which contravenes what the Commission requires: suspension and investigation of the zero tolerance complaints.”

The preliminary investigation into Uber’s compliance filing shows sufficient grounds for the formal investigation into the matter, according to the enforcement division’s order.

A spokesperson for Uber told Law360 on Thursday that the company has zero tolerance for any impaired driving.

“This report relates to complaints in 2014 and 2015 and we’ve significantly improved our processes since then,” spokesperson Eva Behrend wrote in an email.