Uber’s aggressive expansion methods just cost the company millions of dollars after a Pennsylvania regulator found it guilty of illegally operating in the state in 2014.
In a ruling, the Pennsylvania Public Utility Commission (PUC), which regulates taxi services, voted three-to-two in favor of imposing the $11.4 million fine on Uber — the largest the regulator has ever imposed. The fine is being levied upon the ride-hailing app company for its failure to seek authorization and provide details on its operation between Feb. and Aug. 2014.
While the $11.4 million fine may seem gargantuan, it’s way less than the $49.9 million originally imposed by two administrative judges in an initial ruling against Uber last November. Uber, however, is still not happy.
The San Francisco-based company now plans to appeal the ruling in the Pennsylvania state court. The company said it was “shocked” at the severity of the ruling by the PUC, when, in a similar case, Lyft was only fined $250,000, Reuters reported.
Even some dissenting PUC commissioners couldn’t help but point out how “egregious” and unnecessarily high the fine was. Nonetheless, PUC has an example to set. John Coleman, a PUC commissioner, said imposing the fine was imperative to deter other businesses from following such illegal business practices.
The $11.4 million fine, Coleman argued, was a solid reduction from the $49.9 million fine to reward Uber for proper compliance and the minimal complaints that have been noted since Uber was provided with a two-year experimental license early last year.
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In Uber’s argument, it says it hasn’t violated the public utility code as its service didn’t qualify as a motor carrier or broker. Such hefty fines are seen in cases involving life-threatening injuries and deaths, stated Pamela Witmer, one of the PUC’s dissenting commissioners.
