A Toronto taxi owner has filed a $410-million lawsuit against Uber on behalf of the cab industry – even as the ride-sharing company continues its relentless expansion across the country and around the world.
Dominik Konjevic, the plaintiff in a class-action suit filed by Sutts, Strosberg LLP on Thursday, alleges that Uber has diverted "millions of dollars of revenue" away from the taxi and limo industry and asks for an injunction to shut down the company's operations in Ontario. The suit was filed on behalf of all taxi and limo drivers, brokers and owners in the province.
In his suit, Mr. Konjevic alleges that Uber conspired to break Ontario's Highway Traffic Act – which requires an appropriate licence or permit to pick up passengers for compensation – resulting in harm to the taxi industry. "The defendants and the UberX drivers knew, or ought to have known, that the natural result of their conspiracy would be injury to the ongoing legitimate business interests of the class members," he alleges in court records.
The lawsuit – which was prompted in part by the iTaxiworkers Association, one of the city's largest taxi organizations – attempts to put up a roadblock after a string of wins around the world for the Silicon Valley-based giant. A standoff in New York with Mayor Bill de Blasio over whether to impose a vehicle cap ended in Uber's favour this week.
And closer to home, Uber announced its expansion into four new cities in Ontario on Thursday: London, Hamilton, Guelph and Waterloo.
Meanwhile, the City of Toronto appears to be on the verge of regulating the company, though it is not yet clear what that regulatory system may look like.
Still, the class-action suit is not the only legal action facing the ride-sharing company.
In Toronto alone, 11 UberX drivers are facing Highway Traffic Act charges under the same section cited in Mr. Konjevic's suit. At the same time, 36 UberX drivers have been charged with 72 infractions under city bylaws.
But Mr. Konjevic's lawyer, Jay Strosberg, said his client's suit, unlike other ongoing proceedings, is necessary because it seeks to compensate drivers directly. While licensed taxi and limo drivers are required to follow a long list of regulations, including licensing fees, UberX drivers aren't. As a result, Mr. Konjevic has seen a 48 per cent drop in revenues just this year, his lawyer said.
"We're looking for compensation," Mr. Strosberg said – something he claims the ongoing political debate at Toronto City Hall will not address.
City staff are expected to come back in September with proposals for regulating Uber. "The change in the regulations isn't going to get Dominik compensation, and compensation for drivers in the GTA," Mr. Strosberg said.
In an e-mailed statement, Uber Canada spokeswoman Susie Heath dismissed the suit. "This protectionist suit is without merit," she said. "As we saw from a recent court ruling in Ontario, Uber is operating legally and is a business model distinct from traditional taxi services."
That ruling was issued by Ontario Superior Court Justice Sean Dunphy this month after the City of Toronto attempted but failed to get an injunction against the company. In his decision, Justice Dunphy found that, under city bylaws, Uber is not an illegal taxi service. That case – which the city is still considering appealing – did not address the provincial Highway Traffic Act cited in Mr. Konjevic's class-action suit.
According to Mr. Strosberg, the suit is the first of its kind against Uber in Canada.