A New York state court has issued a temporary restraining order against Lyft, the on-demand ride-sharing app, from operating in New York City, after the state attorney general sued the service just hours before it was set to launch in the New York City market. The suit says the company actually operates as a traditional for-hire livery service using mobile technology, not a peer-to-peer transportation platform as claimed.
Attorney General Eric Schneiderman said the company operates "in open defiance" of state and local licensing and insurance laws. He sought the restraining order plus a civil penalty and loss of profits. The suit says Lyft began operating in Buffalo and Rochester without authorizations in April and currently violates various laws.
A call to the company's attorney wasn't initially returned.
Meera Joshi, the chair of the Taxi and Limousine Commission, said earlier this week that Lyft's business model is illegal. The TLC has met with Lyft twice. Based on those meetings, Joshi said she concluded Lyft is a bad idea because she said it is unsafe for passengers and drivers. She said you can call it car-sharing but it is an illegal cab service.
Lyft said New York City's laws are outdated and it plans to launch regardless of city reaction. It argues Brooklyn and Queens need interborough service because 95 percent of yellow cab service is in Manhattan or the airports.
But Joshi said Lyft has apparently not heard about the NYC Boro Taxi service, green cabs that do lots of outer borough and interborough service.
Lyft said its app-based car-sharing was supposed to begin Friday, July 11, at 7 p.m. in Brooklyn and Queens.
The TLC said if Lyft launches, the commission will arrest drivers.
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