Dallas' Unfair Fight to Crush Uber

City Hall does the taxi industry's dirty work to kill competition.

It's the oldest play in the crony capitalist's book: If you can't beat them, regulate them out of existence.

City Council members like Scott Griggs and Philip Kingston, who discovered the proposed ordinance change on the agenda just days before it was set for a vote, have some tough questions they can't wait to ask: How in the hell did this all happen? Why were undercover vice cops out issuing misdemeanor citations based on an incredibly nuanced city code that it isn't at all clear Uber violated? Was city staff working diligently to regulate an "unauthorized operator" in the interest of public safety? Or were they casting out the future of on-demand transportation for the benefit of an industry that sees Uber as a mortal threat to its existence?


Think of Uber's march through America's major cities as a war. Months before riders use the app to hail their first Town Car, Uber's forward operatives have already engaged in months-long reconnaissance of the city. They know how the taxi-per-capita ratio shakes out. They know all about its public transportation options. They've already dived into municipal ordinances and examined the limo and taxi codes for legal issues.

"We felt good about Dallas," said Leandre Johns, Uber general manager for Dallas and Fort Worth. "And the way the regulations read, it was well within reason. We didn't think we'd have much to worry about."

As it turned out, that assessment was a shade too sunny. Dallas wouldn't be any easier to conquer than, say, California, where state regulators issued a cease-and-desist letter, fining the company $20,000 (they eventually reached an agreement allowing Uber to operate). Or, after that, in Los Angeles, where police arrested Uber's "bandit taxicab" drivers in undercover stings. Or in Washington, D.C., where the public and the Federal Trade Commission chided the district council for proposing laws that seemed aimed less at protecting consumers than erecting arbitrary barriers to Uber's operation (the council later withdrew them).

"This is not something we haven't seen before," says Uber spokeswoman Nairi Hourdajian. "It is a standard play in the taxi industry's playbook in order to shut down consumer choice and competition to which they do not want to rise."

Despite significant financial backing from Goldman Sachs, Jeff Bezos and Google, Uber fits the role of David battling Goliath comfortably, if only because the resistance the company meets in nearly every city is so predictable.

And so, on November 2, Assistant City Attorney Chris Bowers sent Uber a cease-and-desist letter, recapitulating a pattern that had grown all too familiar. Over the next several months, representatives from Uber met with the city to clarify the nature of their business and to assuage the city's concerns. In correspondence dated as late as March 29, Uber stressed that it neither owned nor operated any vehicles and provided only a referral service, connecting riders with drivers; that it partnered only with drivers who held the required city limousine operator's license, which it verified independently; and that on top of the $500,000 insurance policy its drivers already have, Uber carries a $5 million excess liability policy just in case.

"The city knew all this before any of this started," Griggs says. "They had it in writing."

This spring, however, says Joel Reese, an attorney for the drivers, some of his clients reported picking up a woman named Deborah Burns, a former FBI agent listed as a consultant for private investigator Danny Defenbaugh. A few of them say they picked her up at a Walgreens near Lake Cliff Park, which happened to be just a few hundred yards from Defenbaugh's office. And his office, as it turned out, shares a building with attorney John Barr, who represents Yellow Cab. The citations these drivers received invariably dated back to the rides they gave Burns. When reached by phone, Defenbaugh said he would need to consult with Barr before commenting and did not reply by press time. A message left with Barr's office was not returned.

By May, the undercover stings began and tickets were issued to drivers like George. "It was a surprise to us," says Johns, Uber's local manager. "We'd had what I thought were good conversations with [the city]. Anytime they made a request, we sat down and talked. This came out of nowhere. They made no indication this was going to happen and they did say, 'Hey, if we're going to do anything or have any questions, we'll let you know.' But that wasn't the case at all."

Yet even as late as August, Reese says, limo companies who have partnered with Uber report receiving demands from city officials for ride manifests and records.

Uber, invoking its usual narrative, blames the local taxi industry, which it says exerts significant muscle in city halls across America. There might just be something to it. Taxis have always wielded influence in Dallas. Recall Al Lipscomb, the longtime council member who was both a civil rights icon and a symbol of pay-to-play city politics from the mid-'80s to 2000. He was a strident opponent of any regulation beneficial to taxis, and not without reason. They had historically failed to service his South Dallas constituents. That was until 1994, while Lipscomb was off the council, and Floyd Richards, owner of the Yellow Cab and Checker Cab franchises, asked for help with burnishing his company's reputation in minority areas of the city in exchange for $1,000 monthly payments.

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39 comments
annette727
annette727

Who's insured?? Last year I tried to add my husbands Taxi on our policy, just for extra coverage. The answer was NO! And mind you we have clean driving records. I was shocked they wouldn't touch us. So my question is ? Is Uber insuring each of these privately owned vehicles and if so how? NO! And if not, how are they monitoring the drivers insurance?

Anyone can alter the coverage on a vehicle after giving them what paperwork they requested at the beginning. And Uber is not the lender on the car so they are not entitled to any policy change. Hello Dallas wake up.... I personally have nothing against Uber except they should have to follow all the same rules, licenses, monthly inspections, etc.

The ones they are hurting the most is the "little guys" like us. We have to work just like everyone else to put food on the table for our family. We are a family owned US citizen, well spoken English Taxi Service in Dallas. Please don't put "ALL" taxicabs in the same box. We are an honest company that care about customer service! Unlike Uber you are just a number. Where's they loyalty Dallas?? Or is there such a thing these days!

chuythegr3at
chuythegr3at

I like the chić feel of uber.

If taxies in Dallas were black, dripped in leather, and had personable drivers in a standard suit/tux uniform, I would totally use a taxi like that.

However the taxies in Dallas are old, disgusting and you have to wait forever.

Uber gives me a driver at my fingertips.

That's how the world is going, get over it.

The taxi cab drivers in Dallas also need to check their attitudes.

Customer service is key, and uber has that.

My uber drivers have always been nice, personable and knowledgeable about the cities I've used uber in.

I say Dallas gets rid or public taxies and just higher uber.

Plain and simple.

amhs879
amhs879

City of Dallas is not approving the new limo licenses because of Uber. They think that everyone starting the new limo business, will be working for Uber. They are scared to tell this to the public openly because of their corruptions within.

DallasCabbie
DallasCabbie

As a cab driver in Dallas since 1979 it just boils down to definitions.  A Taxi service in the city of Dallas can pick up from cab stands, hails from the street, and on demand [asap] calls for service.  A Town Car or Limo service has historically been one where a reservation is made 30-60 minutes in advance.  I have no objection to Uber as it simply is an easier way for independent Town Car operators to get more business.  A co-op dispatch as it were.  But I also feel they should have the requirement of beeing booked 30-60 minutes in advance.  How many business people do not know in advance they need a ride??

Also, the pre-booking requirement would make illegal the practice of Dallas hotel employees of lining their pockets from people coming down, asking for a taxi, and the doorman guiding the passengers to their friendly neighborhood Town Car out front and getting a kickback.

JRjr
JRjr

"Bewley, in an emailed statement, says he simply wants "a level playing field" where the law is "equally applied to all participants." "

Translation:  Bewley wants the taxpayer funded police and courts to offset his technological and public relations issues.   

 Where is the "free market" in that?

If the cab companies used some of their assets to upgrade to a Uber-type technology and to put their drivers through customer service training, they would not need the police or the justice system to intervene.


johnsmith
johnsmith

If it wasn't a Dot certified police officer he had No right to stop you no jurisdiction  But to help with some  understanding of l laws related to drivers operators and traffic here is some case law in these youtube links that back it all up help you under stand    copy past in search bar    .http://youtu.be/jILkxbK_lzk .  and  this link ,,,,,http://youtu.be/_Ytf7wGA4ns,,, and if that don't beat them into the dirt then getting a 503c certifying you as a non profit aka a church will and then they have no authority over you non profit ! aka a Jessie Jackson move

kimsearley
kimsearley

I use Uber all the time when I travel to LA...Guess what?  They actually pick you up and it doesn't take 30 - 45 for them to arrive!

kerptinpicard
kerptinpicard

Uber is way better than a cab. If you want to save $15 off your first ride, use code 521o9.

Sudilos
Sudilos

I do not authorize the city of Dallas to spend police budget on enforcing Yellow Cabs policy especially if no laws are being broken.

tim_lebsack
tim_lebsack

re: "of any regulation beneficial to taxis"

What regulations are beneficial to taxis??

 

RhetoricalQuestion
RhetoricalQuestion

Ah, corrupt liberal city policies strike again.

Uber sounds fantastic, it is a real 'power to the people' application. 

Admonkey
Admonkey

If the COD & Yellow Cab really want to take Uber on, it's going to become courtroom-expensive as hell for both Yellow Cab owner Jack Bewley and the City of Dallas taxpayers: 

Taxi & limo service is a $10bn/yr industry in the U.S., but Uber has equity funding of $307MM— an equity funding number that equates to a little over 3% of the entire domestic industry.

I'm guessing Uber can, and will, eventually out-lawyer both the city and Bewley (fairly easily in fact), particularly over an antitrust issue that seems like a real "duh" moment to anyone who reads two paragraphs on it.

And the Council Members who get on the wrong side are going to have to explain exactly why they voted the way they did— and put the city finances farther into the lawsuit hole— just because Yellow Cab once spread some small-time cash around the old general election campaign and lobbying fund.

pak152
pak152

so when will the po-po do a sting operation on Yellow Cab et al making suring they are following all the regulations?

mdd0124
mdd0124

On Sunday, after the pride parade (more like 11:30 PM), I was tired, a little drunk, and ready to go home. I walked up to a cab outside S4, and asked if he'd take me home (Knox-Henderson area). He flat-out refused, and told me he was waiting for a bigger fare, and to ask another cab. 

My phone had 1% battery, but I was able to pull up Uber, a cab came in less than 3 minutes, and I was home in less than 10.

That is why #DallasNeedsUber.

mrarmyant
mrarmyant

Yellow Cab just released an iPhone app for Dallas.  I wonder if they would also face the same 30 minute wait, however it frequently takes 30 minutes to get a cab and I live in Oaklawn...

cjbwalton
cjbwalton

What is the status of the search for a new City Manager? Interim City Manager Gonzales is NOT the right person for the job.

BettyC1
BettyC1

Some new Council members are actually reading their agendas.Good for them.

primi_timpano
primi_timpano topcommenter

I have experienced too many bad taxi experiences. To name a mere 3 of many: trying to refuse a DFW pickup for interteminal transfer; driving under the influence (the cab crashed into a parked car when it arrived at my destination--the driver asked me to be a witness to his sobriety, I suggested I would not be a helpful witness--he was drinking, but used many anyway--I said he appeared intoxicated and smelled like whiskey); and crashed my car when doing a U turn across four lanes in from of the Fairmount--trying to catch a fair. And forget trying to schedule a cab to get to the airport on time.

Never a problem with Uber.

whocareswhatithink
whocareswhatithink

Once we have 2 or more folks in our car and travel from M streets to Uptown or Downtown - Uber is cheaper, and nicer. Its a no brainer. There is nothing like getting in a cab and before its left the curb the driver has hit fee after fee after extra fee, none of which makes sense.

Also I wish the COD would stop talking about how they care about our safety - they don't and plus we can all read the waiver we sign when we join.

NightSand
NightSand

Instead of the Cabs fighting and giving money to the criminals on City Council, why not create their own app with the same function, but make the fares cheaper?   The reason Uber works is because they give you an exact time they will arrive, they actually do arrive, they take credit cards without a fight and generally know where they are in the city... not to mention their cars are all clean and don't smell bad.   

  I use Cowboy Cab a lot and have had pretty pleasant experiences with them, but Uber tops them, though it is more expensive.  

hentai.jeff
hentai.jeff

@RhetoricalQuestion if you want to assign the term liberal to a side in this debate, it's actually on uber, need only look at their funding for that one.

ScottsMerkin
ScottsMerkin topcommenter

@pak152 All one has to do is stand on a corner in the CBD and you could witness all kinds of unsafe for the public actions by any number of cabs

pak152
pak152

@mdd0124 did you get the cab number and report his refusal?


jocktop
jocktop

@mdd0124 isn't it illegal for them to refuse a fair? My drunken friend yelled his way into a cab that tried to pull this after a ranger's game, just because we wanted to go to some arlington bars nearby, not drive all the way to dallas.

lakewoodhobo
lakewoodhobo

@whocareswhatithink Plus you can split fares with Uber. Try getting a cab driver to take one credit card, and imagine the look on his face if you asked him to take two of them!

Dub919
Dub919

@ScottsMerkin @pak152 Yep.  I walk around downtown often...and the only time I've ever come close to being hit by a car was by a Yellow cab who was speeding through a red light.

Or, you could just sit at the Love Field entrance portion of Cedar Springs.  The road becomes a 30mph zone about halfway through with a radar sign indicating your speed.  I got passed by Yellow and Executive at that spot today...both were going at least 62 mph (which is what the sign indicated).

pak152
pak152

@ScottsMerkin @pak152 but if i or you witness them our account is apocryphal, but if the po-po does it we have a record that can be used.

kimsearley
kimsearley

@jocktop @mdd0124  Cabs refuse fares all the time...I live near DFW Airport and when I come in at an "off" hour, they refuse to take me home.  Finally, I just hired a car service. It's not worth the stress to deal with them!

ScottsMerkin
ScottsMerkin topcommenter

@lakewoodhobo OMG, We had a cabbie that was actually going to take a credit card, then when he saw 2, mysteriously the machine suddenly didnt work lol

brantley.hargrove1
brantley.hargrove1

@ScottsMerkin @tim_lebsack Things like freezing the number of operating licenses issued, followed by allowing fleet increases so the majors can increase their hold on the market. Things like that.

 
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