1 00:00:00,080 --> 00:00:03,040 Speaker 1: There are now forty five thousand Uber and Lift drivers 2 00:00:03,040 --> 00:00:06,920 Speaker 1: in San Francisco. The number of licensed taxis eighteen hundred 3 00:00:07,000 --> 00:00:10,639 Speaker 1: and shrinking. But the trouble taxi industry is still fighting 4 00:00:10,640 --> 00:00:12,760 Speaker 1: in court, and one of those fights is in federal 5 00:00:12,840 --> 00:00:15,720 Speaker 1: court in San Francisco, where U S District Judge Edward 6 00:00:15,840 --> 00:00:19,720 Speaker 1: Chen yesterday considered claims by Flywheel Taxi, a company that 7 00:00:19,720 --> 00:00:23,520 Speaker 1: says it has the first app oriented taxi fleet. Flywheel 8 00:00:23,560 --> 00:00:27,360 Speaker 1: claims the state's Public Utilities Commission has created an uneven 9 00:00:27,360 --> 00:00:30,960 Speaker 1: playing field, letting Uber and other rides sharing services escape 10 00:00:30,960 --> 00:00:34,320 Speaker 1: the types of regulations that taxis must abide by. With 11 00:00:34,440 --> 00:00:37,240 Speaker 1: us to talk about that case and other legal matters 12 00:00:37,240 --> 00:00:41,920 Speaker 1: involving Uber is Bloomberg San Francisco Courthouse reporter Joel Rosenblatt. Joel, 13 00:00:41,920 --> 00:00:44,240 Speaker 1: thanks for being with us. Um, Well, we'll just start 14 00:00:44,280 --> 00:00:49,519 Speaker 1: by telling us what Flywheels argument is in this case. Yeah. Sure. So, 15 00:00:49,680 --> 00:00:53,000 Speaker 1: Flywheel is a taxi cab company here in San Francisco, 16 00:00:53,080 --> 00:00:55,600 Speaker 1: as you said, and it's saying that that it is 17 00:00:55,640 --> 00:00:58,880 Speaker 1: providing essentially the same services as Uber or that really 18 00:00:59,120 --> 00:01:02,200 Speaker 1: kind of the inverse of that that Uber is providing 19 00:01:02,440 --> 00:01:05,400 Speaker 1: essentially a taxi service. But that the taxis are so 20 00:01:05,520 --> 00:01:09,679 Speaker 1: good to far more rigorous local regulation and that that's 21 00:01:09,680 --> 00:01:13,440 Speaker 1: the violation of its constitutional guarantee of of equal protection 22 00:01:13,520 --> 00:01:17,160 Speaker 1: under the law, and so it's seeking to undo um 23 00:01:17,959 --> 00:01:20,640 Speaker 1: a decision by a state agency that kind of made 24 00:01:20,640 --> 00:01:26,119 Speaker 1: that created that discrepancy in regulation. Joel. Part of the 25 00:01:26,280 --> 00:01:32,800 Speaker 1: argument that seems logical is that there are these these 26 00:01:33,040 --> 00:01:38,240 Speaker 1: ubers and and lifts riding around with no regulations on them. 27 00:01:38,840 --> 00:01:42,800 Speaker 1: Um they have they have. There might be issues of 28 00:01:42,840 --> 00:01:45,839 Speaker 1: how well they drive, or all different kinds of things 29 00:01:45,840 --> 00:01:50,480 Speaker 1: that taxis aren't aren't subjected to, and there is there 30 00:01:50,520 --> 00:01:55,120 Speaker 1: a concern about public safety, Well, there is. That's one 31 00:01:55,120 --> 00:01:58,320 Speaker 1: of the that's certainly one of flywheels kind of major arguments. 32 00:01:58,440 --> 00:02:01,040 Speaker 1: And it's not maybe you know, it's not it's not 33 00:02:01,080 --> 00:02:03,040 Speaker 1: the kind of front and center as a legal argument, 34 00:02:03,040 --> 00:02:05,960 Speaker 1: but it's but it kind of resonates in the practical sense. 35 00:02:06,000 --> 00:02:08,440 Speaker 1: I don't know about where you are, but in San Francisco, now, 36 00:02:08,440 --> 00:02:12,399 Speaker 1: as you mentioned the numbers UM, the tens of thousands 37 00:02:12,560 --> 00:02:16,239 Speaker 1: of ubers and lift cars versus you know, the it's 38 00:02:16,280 --> 00:02:20,399 Speaker 1: really less than now taxis UM they're they're just everywhere. 39 00:02:20,480 --> 00:02:23,480 Speaker 1: It seems like every third car as an Uber sticker 40 00:02:23,480 --> 00:02:27,120 Speaker 1: on it, and they they they are pulled over, oftentimes 41 00:02:27,120 --> 00:02:32,639 Speaker 1: in very inconvenient places. Um. So that creates a traffic 42 00:02:32,919 --> 00:02:38,040 Speaker 1: problems and and dangers, especially for bicyclists. There's also an 43 00:02:38,040 --> 00:02:42,120 Speaker 1: issue of the background checks. So so the taxi cab 44 00:02:42,160 --> 00:02:45,040 Speaker 1: companies are are required to subject their drivers to very 45 00:02:45,120 --> 00:02:48,360 Speaker 1: to the most strenuous kind of rigorous background checks criminal 46 00:02:48,360 --> 00:02:51,840 Speaker 1: background checks. Uh, not as not as rigorous for Uber. 47 00:02:51,919 --> 00:02:54,560 Speaker 1: So there's they make that claim too. So there's a 48 00:02:54,639 --> 00:02:56,959 Speaker 1: number of yes, I mean the answer is yes, there's 49 00:02:56,960 --> 00:02:59,600 Speaker 1: a number of safety safety concerns on kind of in 50 00:02:59,639 --> 00:03:05,160 Speaker 1: different in different areas. Joe. What was the judge's reaction 51 00:03:05,240 --> 00:03:09,000 Speaker 1: to this equal protection argument in court yesterday? Yeah, good question. 52 00:03:09,080 --> 00:03:12,320 Speaker 1: It's it's very interesting. This is Judge Edward Chen who 53 00:03:12,440 --> 00:03:18,240 Speaker 1: is deeply, deeply familiar with Uber's operations because he's handled 54 00:03:18,440 --> 00:03:21,520 Speaker 1: a number he handles a lot of litigation involving Uber, 55 00:03:21,800 --> 00:03:26,040 Speaker 1: including the very big employment classification case, which we can 56 00:03:26,080 --> 00:03:28,440 Speaker 1: talk about more if you want to. But he's he's 57 00:03:28,480 --> 00:03:31,679 Speaker 1: so deeply familiar with with the company. It's very it's 58 00:03:31,720 --> 00:03:34,519 Speaker 1: kind of I think useful and interesting. Um it's a 59 00:03:34,720 --> 00:03:38,600 Speaker 1: he's a judge who pushes both parties to extremes of 60 00:03:38,640 --> 00:03:40,640 Speaker 1: their arguments, so it's hard to kind of figure out 61 00:03:40,640 --> 00:03:44,720 Speaker 1: where he's going, but he, you know, in order to 62 00:03:44,920 --> 00:03:48,120 Speaker 1: succeed in its argument, fly Wheel has to say that 63 00:03:48,200 --> 00:03:52,600 Speaker 1: these that that it's it is very similarly situated to Uber. 64 00:03:52,680 --> 00:03:55,560 Speaker 1: So essentially they're the same types of companies and they 65 00:03:55,560 --> 00:04:00,600 Speaker 1: shouldn't be regulated differently. The state, the regulatory agency Flywheel 66 00:04:00,600 --> 00:04:02,960 Speaker 1: has sued, has to argue that the opposite right, that 67 00:04:02,960 --> 00:04:06,320 Speaker 1: they're dissimilar. Um that the that there's a there's a 68 00:04:06,400 --> 00:04:09,640 Speaker 1: key difference, and the key difference that it argues is 69 00:04:09,680 --> 00:04:14,960 Speaker 1: that um that taxis can get street hail. So for example, 70 00:04:14,960 --> 00:04:17,039 Speaker 1: if you want to ride off of the street, you 71 00:04:17,080 --> 00:04:20,160 Speaker 1: can flag a taxi down, You're not allowed to do 72 00:04:20,200 --> 00:04:23,440 Speaker 1: that with an Uber and the state agencies arguing that's 73 00:04:23,480 --> 00:04:27,200 Speaker 1: a big, big difference, and the judge, Judge Hans seemed 74 00:04:27,279 --> 00:04:32,359 Speaker 1: to be sympathetic ultimately to that point. We will see 75 00:04:32,640 --> 00:04:36,599 Speaker 1: this is a motion to dismiss, so um, we'll see 76 00:04:36,760 --> 00:04:40,440 Speaker 1: I'm guessing that he lets it go forward, but but 77 00:04:40,600 --> 00:04:44,719 Speaker 1: he is very skeptical about whether the taxi kept whether 78 00:04:44,720 --> 00:04:47,680 Speaker 1: the Flywheel can succeed with with that argument. So you 79 00:04:47,760 --> 00:04:52,040 Speaker 1: write that Flywheel has an unlikely ally and that it's 80 00:04:52,160 --> 00:04:57,200 Speaker 1: the regulator, the San Francisco Municipal Transportation Authority tell us 81 00:04:57,240 --> 00:05:00,880 Speaker 1: about that. Yeah, so that's the that's the local regulator 82 00:05:00,920 --> 00:05:03,800 Speaker 1: of the taxis. They've they've always kind of regulated taxis 83 00:05:03,880 --> 00:05:06,400 Speaker 1: and they've been you know, I think it would be 84 00:05:06,440 --> 00:05:09,200 Speaker 1: fair to describe the the s f M t A 85 00:05:09,200 --> 00:05:14,440 Speaker 1: as having been timid up to this point. Um, you know, 86 00:05:14,480 --> 00:05:17,400 Speaker 1: I mean that's my assessment. That's certainly the assessment of 87 00:05:17,400 --> 00:05:20,240 Speaker 1: of um, the taxi cabs. But they have been they've 88 00:05:20,240 --> 00:05:23,279 Speaker 1: been timid in going up against the state and the 89 00:05:23,320 --> 00:05:26,600 Speaker 1: state agency in terms of trying to kind of reassert 90 00:05:26,760 --> 00:05:32,880 Speaker 1: its control over over the rideshare companies. But the problem 91 00:05:32,920 --> 00:05:35,400 Speaker 1: that I described earlier where you have so many now 92 00:05:35,480 --> 00:05:40,160 Speaker 1: you have so many uber cars and lift cars, uh, 93 00:05:40,200 --> 00:05:44,840 Speaker 1: frankly creating adding to a lot of congestion in this city. 94 00:05:44,920 --> 00:05:47,160 Speaker 1: I think the I think we're reaching maybe a tipping 95 00:05:47,160 --> 00:05:51,200 Speaker 1: point where the local agency is getting more aggressive in 96 00:05:51,320 --> 00:05:55,680 Speaker 1: its willingness to kind of assert itself, and so the 97 00:05:55,680 --> 00:05:58,720 Speaker 1: the state agency, this is the California Public Utilities Commission, 98 00:05:58,960 --> 00:06:01,920 Speaker 1: is kind of constantly a valuating these definitions and regulations 99 00:06:01,920 --> 00:06:04,919 Speaker 1: and wondering whether whether it needs to be changed. And 100 00:06:04,960 --> 00:06:06,919 Speaker 1: in recent comments the s F M t A has 101 00:06:06,960 --> 00:06:11,119 Speaker 1: been much more aggressive in saying, really these these uh, 102 00:06:11,360 --> 00:06:15,080 Speaker 1: the Uber and Lift ought to be regulated more like taxis. 103 00:06:15,960 --> 00:06:19,160 Speaker 1: It's been pretty pretty for for this for the city agency. 104 00:06:19,160 --> 00:06:22,640 Speaker 1: It's been a market change in the language. Joel, you 105 00:06:22,680 --> 00:06:25,839 Speaker 1: mentioned the other cases before Judge Chen involving Uber and 106 00:06:25,960 --> 00:06:28,320 Speaker 1: its drivers. Can you just give us an update on 107 00:06:28,320 --> 00:06:32,279 Speaker 1: on where that stands. Yeah, it's complicated, but and so 108 00:06:32,400 --> 00:06:33,919 Speaker 1: you can cut me off if I if I go 109 00:06:34,000 --> 00:06:38,880 Speaker 1: too long. But briefly, Uh, this judge has allowed that 110 00:06:38,960 --> 00:06:41,720 Speaker 1: case to go forward. Right, So this is a lawsuit 111 00:06:42,560 --> 00:06:47,400 Speaker 1: challenging the driver's classification as as independent contractors. They're arguing 112 00:06:47,440 --> 00:06:50,080 Speaker 1: they should be treated as employees and and afforded the 113 00:06:50,160 --> 00:06:54,919 Speaker 1: benefits that employees get. His his his rulings which have 114 00:06:55,000 --> 00:06:57,359 Speaker 1: allowed the case to go forward, is a class action 115 00:06:57,440 --> 00:07:01,359 Speaker 1: in a big way. Uh. Uh. You know, tens of 116 00:07:01,600 --> 00:07:05,800 Speaker 1: hundreds of thousands of drivers um have been appealed and 117 00:07:06,000 --> 00:07:10,040 Speaker 1: Uber has won some rulings on appeal. Um it's complicated. 118 00:07:10,040 --> 00:07:13,040 Speaker 1: I can go into into the appeals court status if 119 00:07:13,080 --> 00:07:15,560 Speaker 1: you want. But it's kind of hung up there for 120 00:07:15,720 --> 00:07:18,679 Speaker 1: right now. It's kind of frozen at the appeals court, 121 00:07:19,120 --> 00:07:21,120 Speaker 1: and so Judge sent doesn't have much to do with 122 00:07:21,160 --> 00:07:24,600 Speaker 1: that case for the time being. As it's been appealed, 123 00:07:25,160 --> 00:07:28,640 Speaker 1: that case has been kind of picked apart um, in 124 00:07:28,840 --> 00:07:33,320 Speaker 1: large part because of rulings that most of the drivers 125 00:07:33,360 --> 00:07:36,840 Speaker 1: should be subject to arbitration. Um, it's still it's just 126 00:07:37,160 --> 00:07:40,040 Speaker 1: it's just a long, kind of complicated battle. That's that's 127 00:07:40,080 --> 00:07:42,800 Speaker 1: still going on right now, hung up at the at 128 00:07:42,800 --> 00:07:46,200 Speaker 1: the Federal Appeals Court, also here in San Francisco. Um. 129 00:07:46,320 --> 00:07:47,960 Speaker 1: You know, we can talk about that more and if 130 00:07:48,000 --> 00:07:51,120 Speaker 1: you want, in just about a minute. Um. There are 131 00:07:51,200 --> 00:07:54,760 Speaker 1: similar fights underway in New York, Boston, in Philadelphia, but 132 00:07:55,320 --> 00:07:58,480 Speaker 1: a Chicago Federal appeals score throughout a challenge by a 133 00:07:58,560 --> 00:08:02,680 Speaker 1: local taxi lobby. And on what basis, Yeah, I'm not 134 00:08:02,960 --> 00:08:04,880 Speaker 1: to be honest with you, I'm just not that familiar 135 00:08:04,920 --> 00:08:07,480 Speaker 1: with that case. But I know the rule you're talking about, 136 00:08:07,840 --> 00:08:10,600 Speaker 1: and I think what's going to happen here. I would 137 00:08:10,640 --> 00:08:13,840 Speaker 1: guess that that we're gonna have a similar appeal here 138 00:08:14,960 --> 00:08:18,240 Speaker 1: at the Ninth Circuit. Um, and so we'll see whether 139 00:08:18,360 --> 00:08:21,280 Speaker 1: or not. Um. You know, we get split at the 140 00:08:21,320 --> 00:08:25,200 Speaker 1: circuit court or or um ur Uber goes to for zero. 141 00:08:26,680 --> 00:08:29,840 Speaker 1: I want to thank Joel Rosen Black Bloomberg San Francisco 142 00:08:30,040 --> 00:08:32,520 Speaker 1: legal reporter for our joining us today to talk about 143 00:08:33,320 --> 00:08:36,360 Speaker 1: Uber and the city of San Francisco and challenged by 144 00:08:36,360 --> 00:08:40,840 Speaker 1: a local taxi company to the regulations that apply to Uber. June. 145 00:08:41,040 --> 00:08:45,199 Speaker 1: Uber is all over the courthouses in the country. There's 146 00:08:45,720 --> 00:08:47,560 Speaker 1: another case that maybe we can talk about on a 147 00:08:47,600 --> 00:08:54,719 Speaker 1: different day, UH involving allegations of whistleblower allegation that um 148 00:08:55,000 --> 00:08:58,880 Speaker 1: UH that that employees were able to see UH data 149 00:08:59,040 --> 00:09:03,520 Speaker 1: Uber's data and track the activity of celebrities and politicians 150 00:09:03,520 --> 00:09:07,000 Speaker 1: and even ex spouses. No word on whether anybody was 151 00:09:07,000 --> 00:09:12,360 Speaker 1: trying to track Bloomberg Law hosts with that. I I mean, 152 00:09:12,440 --> 00:09:15,040 Speaker 1: I live in New York City and I'm still a 153 00:09:15,080 --> 00:09:18,520 Speaker 1: fan of handling a cab. It's it's just easier for me. 154 00:09:19,360 --> 00:09:22,559 Speaker 1: So there you go, kick, Can you whistle to get 155 00:09:22,600 --> 00:09:26,280 Speaker 1: a cab? Let's not get personal. I've always wanted to 156 00:09:26,280 --> 00:09:29,040 Speaker 1: be able to do that. Okay, coming up on Bloomberg Law, 157 00:09:29,080 --> 00:09:31,920 Speaker 1: we're gonna talk about the biggest patent verdict in history 158 00:09:31,960 --> 00:09:35,080 Speaker 1: that happened yesterday, you're listening to Bloomberg Law. This is 159 00:09:35,080 --> 00:09:35,640 Speaker 1: Bloomberg