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In reply to the discussion: Uber, Lyft owe Chicago $15 million, other Chicagoland entities millions more [View all]WhaTHellsgoingonhere
(5,252 posts)WASHINGTON -- Ride-sharing that its drivers are independent contractors -- automotive entrepreneurs running their own businesses who have decided to link their operations with Uber.
Andrew Schmidt, a labor lawyer from Portland, Maine, has brought a new lawsuit on behalf of his client Spencer Meyer that could create a lot of trouble for Uber based on this distinction. Because if Uber's drivers are really independent contractors like the company claims, it could be breaking a whole different set of laws: The antitrust statutes that protect consumers from corporate collusion.
"Uber has a simple but illegal business plan: to fix prices among competitors and take a cut of the profits," the complaint reads.
If all of the company's drivers really are independent contractors, then they aren't allowed to secretly conspire over what to charge their customers, the lawsuit reasons. That would be price fixing, a basic antitrust law violation. Since its technology allows all of these independent contractors to set identical prices, Uber is a price fixing scheme that has to shut down and pay its customers for overcharging them, according to the suit.
"If Uber were to become a transportation company and employ drivers, it would be free to compete with other companies using its pricing algorithm," the complaint reads. "But Uber has refused to become a transportation company. Consequently, drivers using the app are independent firms, competing with each other for riders. They should compete on price
Instead, they have agreed to Kalanicks scheme to fix prices among direct competitors using Ubers pricing algorithm. Ubers price fixing is classic anticompetitive behavior."
http://www.huffingtonpost.com/entry/legal-problem-could-crash-uber_us_5718d485e4b0479c59d714f6