Ride-sharing service, Uber Technologies Inc needs to pay $11.4 million after a Pennsylvania regulator has found that the company operated illegally in the state in 2014.
According to Reuters, the Pennsylvania Public Utility Commission (PUC) received a 3-2 vote that justified that Uber violated measures, including failure to have commission authorization between February to August 2014, and not submitting an explanation about its operations. Initially, Uber was fined with $49.9 million in November and then lowered to $11.4 million, which some dissent commissioners find the fine too harsh. The penalty was the biggest imposed by PUC that regulates transportation providers.
Uber spokesman Jason Post expressed his shock about the company's fine, which they claimed is 45 times higher than what Lyft paid in the similar case. Lyft was fined with $250,000. PUC Commissioner John Coleman said that the fine was appropriate to discourage other companies from doing the same. Uber has gained thousands of passengers through its aggressive marketing, but has become the subject of investigation by several regulators, Street Insider claims.
The San Francisco-based company has faced legal concerns over the safety of drivers and passengers and overpricing. Coleman said that the penalty was lessened because Uber has followed the state rules and has settled some complaints since it acquired a two-year experimental license in January 2015. Meanwhile, the company has just reached a $100 million class action lawsuits in California and Massachusetts. In both settlements, Uber won by claiming that drivers would still remain as independent contractors, and not Uber employees. The company is set to pay 100 million in payments to the 385,000 drivers, Tech Crunch reported.
Uber has expressed its plan to appeal on the $11.4 million fine at the Pennsylvania court. Pamela Witmer, one of the dissenting commissioners, called the fine "egregious." Before the announcement of penalty for Uber, PUC's highest penalty was $1.8 million against Hiko Energy LLC.
