Weekly Roundup: Taxi Apps Face Federal Antitrust Suit Over Alleged Uber Price-Fixing Scheme

Happy Thanksgiving weekend! Taxi apps face federal antitrust lawsuit for allegedly colluding with Uber. Uber cuts AI training contracts. Progressive sued for allegedly providing illegal insurance coverage to California Uber passengers. New study reveals riders waste $300 million annually by not comparing Uber and Lyft prices. Risher reveals he goes undercover as a driver every six weeks. We break it all down for you.

Taxi Apps Face Federal Antitrust Suit Over Alleged Uber Price-Fixing Scheme

SOURCE – Reuters

Four major taxi-hailing app companies, Curb Mobility, Flywheel Technologies, Creative Mobile Technologies, and ARRO, are facing a federal class action lawsuit accusing them of colluding with Uber to artificially inflate passenger fares. The lawsuit alleges that after these companies integrated their technology with Uber’s platform in 2022, pricing between Uber rides and taxi rides became “uniform or near-uniform,” eliminating price competition. The case seeks damages for potentially millions of customers across New York, Chicago, San Francisco, Boston, Seattle, and Washington, D.C.

• The lawsuit claims taxi app companies “traded their growing competitive momentum for access to Uber’s scale and revenue streams” instead of competing independently.

• Uber is not named as a defendant despite being central to the alleged anticompetitive arrangements.

• The case challenges 2022 partnerships that allowed traditional taxis to be hailed through Uber’s app

Uber Abruptly Terminates AI Training Contracts After Just One Month

SOURCE – Business Insider

Uber cut its “Project Sandbox” AI training contracts after just one month, despite promising PhD-level contractors at least three months of work. The approximately dozen contractors were performing AI training tasks for Google at rates up to $110 per hour when Uber notified them that “the client has recently communicated a change in their internal priorities.”

• Workers are still awaiting their first paycheck, which could take up to seven weeks to arrive, and must return company laptops.

• ​​The work involved annotating photos and videos and evaluating AI responses as part of Uber’s push to become a broader “platform for work.”

• The abrupt termination highlights the instability of gig-based AI training work compared to companies with automated AI infrastructure.

Progressive Faces Class Action Over Allegedly Illegal Uber Insurance Coverage in California

SOURCE – Top Class Actions

Progressive Corp. and Blue Hill Specialty Insurance are being sued for allegedly providing Uber passengers with illegally structured insurance coverage in California. Plaintiffs claim the insurers charged riders for the legally mandated $1 million primary uninsured/underinsured motorist coverage but deliberately structured policies to make it secondary coverage instead, a “bait-and-switch” that allowed them to underbid competitors while excluding major damage categories.

• California law requires TNCs to provide $1 million in primary UM/UIM coverage, but the lawsuit alleges Progressive made this coverage “excess” or secondary.

• Plaintiffs seek class status for all California consumers who paid for Uber rides during the class period.

• Progressive settled a separate Florida class action in September for $500,000 over late-night debt-collection emails.

New Study Shows Riders Lose $300 Million Annually by Not Comparing Uber and Lyft Prices

SOURCE – Business Insider

A National Bureau of Economic Research study found an average 14% price difference for identical rides between Uber and Lyft in New York City, with neither platform consistently cheaper. Despite potential savings of $300 million annually in New York City alone, only 16% of U.S. ride-hailing customers check both apps before booking.

• Professor Michael Luca noted that “competition should be a click away, but people are acting like it isn’t.”

• Both companies defended price variations as reflecting legitimate factors like driver supply and customer demand.

Uber’s terms of service prohibit third-party price comparison tools, creating a structural barrier to effective price shopping.

Lyft CEO Drives Incognito Every Six Weeks to Stay Connected to Driver and Rider Experience

SOURCE – Entrepreneur

Lyft CEO David Risher drives for the company incognito every six weeks to directly experience the platform and gather feedback, with these sessions directly inspiring features like Price Lock. Under his leadership since April 2023, Lyft achieved its first full year of profitability in 2024 with record revenue of $5.8 billion.

• Risher rides a Lyft bike to the office daily while counting autonomous vehicles, emphasizing his hands-on leadership approach.

• Lyft guarantees drivers earn 70% or more of rider fares weekly after external fees, paying the difference if they fall short.

• The company is expanding autonomous partnerships, including bringing Waymo robotaxis to Nashville in 2026.

QUICK HITS

• Uber rolls out robotaxis in Abu Dhabi in partnership with WeRide, a Chinese autonomous vehicle company. – CNBC

• Delivery workers in Australia have reached a landmark deal that would set minimum pay for workers. – Reuters

• Want to learn more about the robotaxi industry? Subscribe to The Driverless Digest, our new newsletter and podcast dedicated to the future of autonomous vehicles.

Must Listen Or Watch RSG Content

Here are this week’s featured podcast episode and YouTube videos:

• RSG268: Uber’s NEXT Big Move? Taxis!

• This One Thing Changed Everything When Driving Uber

• Uber’s Driver League Competition?!?

• Uber Says This Will Make Drivers Safer But Will It Really?

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