Pa. PUC refuses to reconsider record $11.4 million Uber fine
Despite pressure from Gov. Wolf, the Pennsylvania Public Utility Commission on Thursday declined to back down and reconsider its $11.4 million fine against Uber for operating a transportation business without a license.
Despite pressure from Gov. Wolf, the Pennsylvania Public Utility Commission on Thursday declined to back down and reconsider its $11.4 million fine against Uber for operating a transportation business without a license.
In a 4-1 vote, the commission rejected Uber's request to reconsider the April fine, the largest in the PUC's history. Chairman Gladys M. Brown said that Uber had failed to raise novel legal issues that would force the commission to reconsider the penalty.
An Uber spokesman called the fine "absurd" and said it would stifle innovation. The company plans to appeal the decision to Commonwealth Court.
The commissioners said Uber's defiance by continuing to operate its ride-hailing service even after the PUC issued cease-and-desist orders weighed heavily on their decision. Though Uber said its actions caused no injuries, and said its violations were minor compared with fatal utility accidents that drew smaller fines, the commissioners were unsettled by the company's unwillingness to acknowledge the commission's authority.
"It's unprecedented in so many ways," said Commissioner John F. Coleman Jr. Uber was cited for more than 120,000 violations - one for each unlicensed ride it delivered.
Robert F. Powelson, the sole dissenting vote, called the fine "excessive" and "grossly disproportionate" to the offense.
Powelson said he agreed with Wolf and others who fear that the fine would put a chilling effect on innovation. Uber has located its Advanced Technologies Center in Pittsburgh, and plans to launch a driverless-car initiative there soon.
"While the state cannot condone companies that do not comply with the Public Utility Code, which exists for the protection of consumers, the recent fine goes too far, and constitutes a penalty on innovation, threatening the company's ability to harness new technologies and create the jobs of tomorrow," Wolf said in a May 3 letter to the PUC, also signed by Pittsburgh Mayor William Peduto and Allegheny County Executive Rich Fitzgerald.
But three Democratic members of the PUC declined to reconsider: Brown, whom Wolf elevated to chairman last year; and Andrew G. Place and David W. Sweet, who are both Wolf appointees.
Sweet and other commissioners called on the legislature to advance a long-stalled measure to regulate the ride-share industry, in which riders hail drivers using apps on their cellphones.
The decision highlights the ongoing conflict over how Uber and its popular car service operate within a traditional regulatory environment. Uber agreed with the call from some commissioners for clarity from the legislature on how ride-hailing services should operate.
"We are shocked that the PUC would compound its past mistakes and send the troubling message that Pennsylvania is unwelcoming to technology and innovation," Craig Ewer, an Uber spokesman, said in a statement.
"For technical violations in bringing Uber to Pennsylvanians, the PUC has imposed an absurd and record-breaking fine which demonstrates why the commonwealth needs permanent, statewide ride-sharing legislation as soon as possible."
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