New York City sued ridehail app Empower and founder Joshua Sear, claiming the company has been operating unlawfully without a license the past few years even as the service gained popularity by offering cheap fares to customers.
Empower has violated local laws by failing to apply for relevant licenses since it began operating in the city in 2022, New York said in a lawsuit filed Friday in state court. The city said it seeks to permanently ban the “unlawful” ridehail service.
“New York City will not tolerate companies that flout the law while putting drivers, passengers, and the public at risk,” New York City Corporation Counsel Steve Banks said in a statement. “The City will use every tool available to ensure that Empower is held accountable and complies with the law.”
Sear, Empower’s chief executive officer, didn’t immediately respond to a request for comment.
Empower has recently gained traction in New York by offering fares on its mobile app that it says are 20% less than Uber Technologies Inc. or Lyft Inc. Fares are lower in part because Empower puts drivers on subscription plans rather than taking commissions on each trip and because it hasn’t been licensed by the New York Taxi and Limousine Commission, so it doesn’t pass on fees and surcharges imposed by the regulator.
“NYC’s streets are not a testing ground for companies that refuse oversight,” said Jason Kersten, the taxi and limousine commission’s press secretary.
Even though the taxi and limousine commission has declared Empower an illegal app and warned riders and drivers of the risks of using it, the service’s monthly active users in the metropolitan area jumped 155% to 92,000 in January since last May, according to market intelligence firm Sensor Tower.
New York Attorney General Letitia James is also reviewing potential violations by Empower, her office said.
Empower has defied a court order to stop operating in Washington. It also operates in Baltimore, South Florida and North Carolina.
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