Ride-sharing company Uber, already tangled in business and legal troubles, has been forced to stop operating in Nevada.
Citing public safety issues raised by state regulators, a district court judge in Washoe County this week blocked the company from operating in the state.
Uber, a multibillion-dollar company that sees itself as simply providing a service through a smart-phone app, matching riders with drivers in their personal cars, argues that it should not come under regulations applied to taxis and other transportation services. The company began operations in Nevada on Oct. 24.
Officials with the Nevada Taxicab Authority and the Nevada Transportation Authority immediately went after Uber drivers as illegal and unlicensed carriers, the Las Vegas Review-Journal reports.
“Under Nevada’s strict common carrier regulations, drivers are to be tested and their vehicles inspected. Regulators also require proof of insurance,” the newspaper says. “While Uber stated that their drivers are thoroughly investigated and must drive late-model vehicles, and that the company holds a blanket insurance policy for its drivers when transporting customers, state officials said it wasn’t good enough.”
Nevada political leaders and the judge in the case don’t necessarily oppose the kind of service provided by Uber.
"There's no question it's a wonderful product," Judge Scott Freeman said. "But I'm charged with following the law – the law currently in existence.... I'm not going to risk the safety of the public."
But, Judge Freeman also asked the company’s lawyers, "Why did Uber choose to operate first without regulation?... Why didn't you try to change the law first, then operate?"
Gina Session, chief deputy attorney general, suggested the company may have been picking a fight in court to “get some momentum” before the upcoming legislative session.
"Uber's approach is to start operations in open violation of the law in hope a groundswell of public opinion will override the regulatory concerns," she told Freeman.
The company, she noted, acquiesced before in agreeing to regulation elsewhere, including in Nebraska, South Carolina, and Maryland.
"When it wants to, it can work with regulatory oversight," Ms. Session said. "Why not in Nevada? Are we the Wild, Wild West?... I've never seen a multibillion-dollar company come into Nevada and so aggressively and deliberately disregard the law.”
The company quickly responded to the court order, which it says will cost 1,000 jobs in the state. The company will "continue to work with regulators and state leaders as we evaluate this development," Uber spokeswoman Eva Behrend said in a statement following Freeman's ruling Tuesday night.
"Nevadans overwhelmingly support the transportation choice, competition, and job opportunity Uber brings to the Silver State," she said.
Uber supporters have been gathering online signatures for a letter to Nevada Gov. Brian Sandoval (R) and Attorney General Catherine Cortez Masto (D).
“Nevadans desperately want and need better, more innovative ways to move around their communities – Uber can help meet that need, as it is currently doing in more than 220 cities and 45 countries around the world,” the letter states. “Regulators shouldn’t stand in the way of consumer choice and economic opportunity simply to enrich a deeply-entrenched taxi industry. Millions of riders have voted for Uber with their pocketbooks and hundreds of thousands of drivers are earning more than they ever could in a taxi by partnering with Uber.”
So far, the petition has gathered about 18,000 signatures.