Pennsylvania Upholds$11.4M Fine Against Uber

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By Leslie A. Pappas

Sept. 1 — The Pennsylvania Public Utility Commission Sept. 1 upheld a record-breaking $11.4 million civil penalty against Uber Technologies Inc. for operating in the state without permission, going against pleas from business leaders, lawmakers and the state's governor to reduce the fine ( Pa. Pub. Util. Comm'n v. Uber Technologies Inc., Pa. Pub. Util. Comm'n, No. C-2014-2422723, 9/1/16 ).

The commission said Uber made an “intentional business decision” to begin operations prematurely and that 122,998 trips were taken before the company received proper authority. The Commission ordered Uber to pay the penalty within 30 days and denied the ride-sharing service a request for reconsideration and rehearing.

“We do not take lightly the fact that the civil penalty in this case is the largest in this Commission's history,” Chairman Gladys M. Brown and Vice Chairman Andrew G. Place said in a joint statement. “However, the reason the penalty is so large is because we were faced with an unprecedented number of violations.”

The penalty is the highest ever imposed by the commission and is almost six times the previous record-breaker, a $1.8 million fine against Hiko Energy for deceptive marketing practices, according to Uber.

Uber ‘Shocked'

Uber said in a statement it was “shocked that the PUC would compound its past mistakes and send the troubling message that Pennsylvania is unwelcoming to technology and innovation.”

The company called the fine “absurd” and said it would appeal the opinion.

In a dissenting statement, Commissioner Robert F. Powelson said the penalty was “inappropriate and inconsistent with Commission precedent” and is “an abuse of Commission discretion.” He argued that the fine should be reduced.

The Commission fined Uber's competitor Lyft about $1,000 per day for the same behavior during the same period, compared to almost $60,000 per day for Uber, Powelson wrote.

The commission voted 4-1 to uphold the penalty, which was originally imposed in April (21 ECLR 622, 4/27/16).

To contact the reporter on this story: Leslie A. Pappas in Philadelphia at lpappas@bna.com

To contact the editor responsible for this story: Keith Perine at kperine@bna.com

For More Information

Full text of the order at http://src.bna.com/iej.

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