SF City Attorney Sues Car-Sharing Company Over Airport Rides
A spokesman for peer-to-peer car sharing site Turo said the company shouldn't be forced to obtain a permit meant for traditional car rental companies.
January 24, 2018 at 05:06 PM
3 minute read
The San Francisco city attorney has sued online car-sharing company Turo, claiming it flouts rules designed to prevent congestion around San Francisco International Airport and provide funding for airport infrastructure.
The complaint filed in San Francisco Superior Court Wednesday claims Turo, formerly known as RelayRides Inc., has continued to provide customers with airport rentals via its website even though its permit to provide “off-site” rental car services at SFO expired last summer. The city contends Turo allows people who rent through its site to have vehicles delivered curbside at SFO's terminals—skirting rules designed to filter rental car customers to designated areas away from the terminals via the airport's AirTrain light rail system.
The airport charges an $18 per ride fee to rental companies for the AirTrain service and received roughly 11.5 percent of its annual operating budget from fees paid by rental car companies last year, according to the complaint.
“All other similarly situated rental car businesses comply with SFO's permit and fee requirements,” the complaint said. “Turo's practices contribute to congestion at SFO terminals, deprive SFO of funds needed for its operation and maintenance, and confer on Turo an unfair advantage over similarly situated business that operate lawfully and fairly.”
Steve Webb, a spokesman for Turo, said in an emailed statement that the company has been in negotiations with the airport to develop a permit that would be appropriate given the company's “peer-to-peer” model. He pointed out California amended its Insurance Code in 2010 to recognize “personal vehicle sharing programs” that are “separate and distinct” from rental car companies.
“Turo cannot be compelled by the San Francisco International Airport ('SFO') to comply with SFO's permitting framework for rental car companies, which would impose unreasonable and exorbitant fees for airport facilities that Turo does not use,” Webb said. “Turo is ready to work with SFO to arrive at a rational arrangement that advances the interests of the airport, rather than the rental car companies, but SFO has flatly rejected such a cooperative solution.”
The suit is the latest in a line of lawsuits pitting City Attorney Dennis Herrera's office against Bay Area companies in the so-called sharing economy, who challenge traditional regulatory regimes. Herrera's office previously tussled with online short-term rental platforms Airbnb Inc. and HomeAway.com Inc. over a local ordinance threatening the companies with steep fines for listing properties not registered with the city. That suit ended in a deal that resulted in thousands of illegal listings being removed from the sites. The office has also sued Uber Technologies Inc. to obtain driver records for tax purposes.
Joining Herrera on Wednesday's complaint were Yvonne Mere, the office's chief of complex and affirmative litigation, and deputy city attorneys Natalie Orr and Jaime Huling Delaye.
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