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Vilcek v. Uber USA, LLC

United States District Court, E.D. Missouri, Eastern Division

July 21, 2002

AARON VILCEK, et al., Plaintiffs,
v.
UBER USA, LLC and UBER TECHNOLOGIES, INC., Defendants.

          OPINION, MEMORANDUM AND ORDER.

          HENR Y EDWARD AUTREY UNITED STATES DISTRICT JUDGE.

         This matter is before the Court on Defendant Uber Technologies, Inc.'s Motion to Dismiss, [Doc. No. 25], Plaintiffs oppose the motion. For the reasons set forth below, the Motion is granted.

         Facts and Background

         Plaintiffs brought this action in the Circuit Court for the County of St. Louis, Missouri on November 12, 2015. Pursuant to the Court's diversity of citizenship jurisdiction, Defendants timely removed the action. 28 U.S.C. §§ 1332, 1441, 1446. On October 29, 2016, the Court dismissed Plaintiff's Petition for failure to state a claim. The Court allowed Plaintiffs to file an Amended Complaint, “consistent with the rulings” contained in the Opinion. Plaintiffs filed their Amended Complaint on October 21, 2016. Defendant now moves to dismiss the Amended Complaint.

         Plaintiffs' Amended Complaint alleges the following: Uber developed and operates a software system that allows passengers with Uber accounts to request rides from drivers. These drivers are classified by Uber as independent contractors. Customer payments are processed automatically through Uber's system at the time a ride is requested. Uber takes a percentage of the payment, normally 20%, and passes the balance of the payment to the driver.

         The St. Louis Metropolitan Taxicab Commission (the “MTC”) regulates taxicabs, their drivers, and taxicab companies operating in St. Louis City and County. The MTC is organized and exists under Section 67.1800, et seq., RSMo. The MTC was created to recognize taxicab service as a public transportation system, improve the quality of the system, and exercise primary authority over licensing, controlling, and regulating taxicab services within St. Louis City and County. The MTC is authorized to license, supervise, and regulate any person who engages in the business of transporting passengers for hire, and is required by statute to establish administrative procedures for granting, denying, suspending, or revoking taxicab licenses. These procedures are stated in the MTC's Vehicle For Hire Code (“Taxi Code”).

         Under the Taxi Code, individuals may not operate a taxicab in St. Louis City or County without first obtaining an MTC driver's license. To obtain an MTC driver's license, a person must comply with certain requirements, including: a. being in possession of a valid Class E chauffeur's license issued by the State of Missouri; and b. submitting to fingerprint identification as required by Section 67.1819, RSMo. Plaintiffs and all members of the putative class have complied with all MTC taxicab driver's license requirements, are in good standing with the MTC, and possess valid MTC taxicab driver's licenses.

         The MTC voted September 18, 2015 to allow Uber to operate in St. Louis City and County. The MTC directed, however, that Uber drivers be fingerprinted and possess a Class E Missouri chauffeur's license, the same as all other taxicab drivers.

         Uber, with intentional and contemptuous disregard for the MTC's authority and rules, and in disregard of the requirements that taxicab companies must comply with to operate taxicab services in St. Louis City and County, launched its services in St. Louis City and County on September 18, 2015 using drivers who do not comply with the Taxi Code's licensing requirements for taxicab drivers.

         Uber's service is functionally and legally indistinguishable from the incumbent taxicab services in St. Louis City and County, and Uber's drivers are functionally and legally indistinguishable from the plaintiff taxicab drivers. Uber and the incumbent taxicab services each provide a vehicle-for-hire service to the public, not operating on a regular route or between fixed terminals. Uber drivers and the plaintiff taxicab drivers work as independent contractors transporting passengers assigned them by the company for a fare set by the company between the locations directed by the passengers. Uber drivers and the plaintiff taxicab drivers each pay a fee to the company for which they work in exchange for the company's contribution to the driver's business.

         Uber's entry into the taxicab business in St. Louis City and County was unlawful and in violation of the MTC's rules and the Taxi Code. Since Uber's unlawful entry into the St. Louis City and County taxicab market, plaintiffs and members of the putative Class have experienced decreases in revenue of 30-40% compared to the comparable time period in 2014 resulting from a decrease in passenger calls. Passenger calls and revenue decreases began on or about September 18, 2015 and were directly caused by Uber's unlawful entry into the St. Louis City and County taxicab market. Uber has admitted that during its first weekend of operations in St. Louis City and County, it provided passengers more than 5, 000 rides. A significant portion of those rides would have gone to plaintiffs and the class but for Uber's unlawful entry into the St. Louis City and County taxicab market. Based on historical trends and the regular course of prior dealings between taxicab drivers and passengers within the St. Louis City and County taxicab market, plaintiffs and the members of the putative class have a reasonable expectation before Uber entered the St. Louis County and the City of St. Louis market that they would continue to see a consistent usage of taxicab services by the traveling public, subject to long-term trends in the economy and punctuated by short-term increases and decreases in ride demand caused by various events.

         Plaintiffs and the members of the putative class collectively had valid and reasonable expectations of future business relationships with current and prospective taxicab passengers collectively The taxicab market in St. Louis County and the City of St. Louis consists of approximately 1, 000 MTC-licensed drivers (based on Uber's estimate) servicing a public seeking ride-for-hire services for trips originating in St. Louis County and the City of St. Louis.

         The public seeking ride-for-hire services includes persons who routinely use taxicabs, business visitors to St. Louis, persons arriving at or departing via the airport, and occasional, local users of the service. Although there are alternative transportation options to ride-for-hire services available in this market, such as buses, MetroLink, rental cars, bicycles, and self-ownership or leasing of an automobile, those alternatives are generally not readily substitutable with ride-for-hire services. In short, for trips for which a member of the public wishes to travel as a passenger from a point of origination to a point of destination of the passenger's choosing, and not between fixed termini, without ownership of or other responsibility for the vehicle, the choice is essentially limited to a ride in a taxicab.

         Historically, the number of taxicab trips taken in St. Louis County and the City of St. Louis remains steady, adjusted by season, with slow ...


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