Pennsylvania Slaps Uber with $11 Million Fine

The ride-sharing service plans to appeal the hefty penalty.

 

uber-PUC-940x540Uber officials probably aren’t popping open champagne bottles or doing happy dances over the $11.4 million fine the Pennsylvania Public Utility Commission levied against the company today, but they can at least go to bed tonight knowing things could have been much, much worse.

Last year, the commission’s administrative judges recommended that the ride-sharing service face a $49.9 million penalty for operating in Pennsylvania without authority for six months in 2014, said Robin Tilley, a spokeswoman for the commission.

(Spoiler alert: Uber feels like the latest penalty is still way too high, and plans to appeal.) 

The commission’s independent Bureau of Investigation of Enforcement filed a complaint in June 2014 against Raiser LLC , the company that began operating Uber out of Pittsburgh earlier that same year. In July, a cease-and-desist order was filed against Uber, but the company continued to do its thing. The order was lifted later that same month, after Uber applied for and was granted emergency temporary authority in Allegheny County. (All of this is laid out in a handy timeline compiled by the commission.)

In January 2015, Uber was granted a two-year experimental service certificate. And that was that … except for the fact that the Public Utility Commission was still plenty unhappy with all of the unauthorized business Uber conducted in 2014.

The commission’s administrative judges called for the massive $49.9 million penalty in November 2015, but the commission opted in a 3-2 split vote today to reduce it to $11.4 million.

On the one hand: “We find that a civil penalty of this size is necessary to deter Uber and other members of this industry from future violations of the Public Utility Code and the laws of this Commonwealth,” Commissioner John Coleman wrote in a joint motion with chairman Gladys Brown.

On the other: “I believe the recommended civil penalty is egregious, especially when compared to other cases in which the Commission has assessed substantial civil penalties for violations of the [Public Utility] Code,” said Commissioner Pamela Witmer in a statement.

Uber didn’t hesitate to express its unhappiness with the commission’s ruling, claiming that fellow ride-sharing service Lyft resolved similar problems for just $250,000. Uber also released a statement that read:

“We are disappointed by today’s decision and shocked by the amount of the civil penalty, which is 45 times higher than the penalty paid by Uber’s competitor for the same activity. As two Commissioners confirmed today, there was no actual harm to Pennsylvanians, and the Commission subsequently approved the same operations. We look forward to making our case to the Commonwealth Court. In the meantime, we will continue to work in good faith with the Commission.”

Uber noted the penalty it is facing is the highest ever imposed by the commission; the next highest was $1.8 million, which was levied against Hiko Energy, for misleading and overcharging its customers.

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