Legal

US Judge: Uber Can Be Sued For Allegedly Forcing Out Rival

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A lawsuit against Uber alleges that the company engaged in deceitful practices to drive its competitor Sidecar Technologies out of business in 2015, according to Reuters.

The lawsuit by SC Innovations, Sidecar’s successor, has been allowed to go forward by Judge Joseph Spero in San Francisco.

The lawsuit claims Sidecar, which was formed in 2012 and was the first company to offer ride-sharing practices, was crowded out of the business by Uber’s reportedly aggressive tactics.

The lawsuit alleges that Uber began offering low fares for passengers and better incentives for drivers to bust into the market. But then the company used “surge” and “dynamic” pricing, as well as other methods to cut driver pay and raise prices for riders, as a way to get back the money it had lost from its earlier deals once it was the most established company in its field.

The lawsuit also says Uber would secretly book and cancel rides on competitors’ apps. Using names like “Project Hell” and “SLOG,” the company allegedly hoped to frustrate competing drivers and passengers to switch to Uber.

Spero wrote that, at this stage, the allegations by SC Innovations seemed to merit the case going forward, unlike an earlier version of the suit that Spero blocked.

Uber had no comment on the allegations.

Uber has faced allegations before, such as in Colombia4, where the country’s regulators accused the company of unfair advantages over local competition because Uber wasn’t paying the same regulatory fees. However, that was later reversed, and Uber was allowed back into the country by February.

Also, in London, Uber was stripped of its licensing to operate over concerns about false identities and safety on the app there.

Uber has also vowed to fight vigorously with an ad campaign this year against California’s AB 5, which forces some gig economy workers to be classified as employees rather than contractors.

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