7/18 UPDATE: A lawsuit has been filed against UBER and Lyft by a group of taxi and limousine companies across Virginia. The civil suit filed in Fairfax County asks the court to ban the two companies from operating in the Commonwealth because they lack necessary permits.
In June, the DMV issued a "cease and desist" order against both companies, saying their operations were illegal. However, according to the lawsuit, both have continued to operate.
UPDATE 6/10: The DMV said Tuesday they stand by their actions and released the following statement:
Virginia DMV supports innovation. The agency has been in communications with UBER and Lyft for months to educate them on Virginia’s law with the goal of bringing them into compliance so that they can operate lawfully in Virginia. During this same period DMV has been charged by the General Assembly to conduct a study of these transportation network companies. We are confident that the solution to transportation network companies operations will come out of the study and we hope that UBER and Lyft will actively participate in the study and be a part of creating the solution. In the meantime, Virginia DMV must fulfill its obligation to highway safety and enforce the law as it is currently written.
RICHMOND -- The Virginia Department of Motor Vehicles sent cease and desist letters to two companies the agency says are essentially operating illegal taxi companies.
The companies, Uber and Lyft, sell rides in a vehicle through an app you download on a smart phone. You use the app to order, track and pay for your car.
Lyft, whose cars are denoted by a fuzzy pink mustache tied to the front grill, launched service in Hampton Roads in April. Uber does not operate in Hampton Roads but does have operations in Northern Virginia. Lyft also operates in Northern Virginia.
DMV has fined both companies previously for operating without a Virginia passenger carrier broker's license.
In his letter, DMV Commissioner Richard D. Holcomb outline the steps his agency had already taken to try and work with each company to bring them into compliance with the law.
"DMV has educated [your company] about Virginia's passenger carrier laws, which apply to any business that receives compensation to provide or facilitate transportation," Holcomb wrote.
CLICK HERE FOR THE DMV LETTER TO LYFT
Both companies contend the law does not apply to them because they operate a ride-sharing service that connects passengers with independent drivers.
"The current regulations surrounding taxis and limos were created before something like Lyft was even imagined," a spokeswoman for Lyft told 13News Now in response to the DMV's fines in April. "Lyft’s peer-to-peer business model does not easily fit into the current framework, but we have made safety a top priority from the beginning by putting forth strict safety measures that go beyond what is required for existing transportation providers."
At the same time, Zuhairah Washington, the general manager for Uber's business in Virginia, said her company is a technology company and not a taxi company.
"The concept of ride sharing is something that hasn't yet been contemplated in many jurisdictions throughout the nation," she said. "So, for us, our main mission is really to try and educate other regulators."
Holcomb's letter said the DMV is actively studying Virginia's passenger carrier laws and how they relate to businesses such as Lyft and Uber.
"DMV has invited Uber and other stakeholders to participate in this study and will produce a final report before he next legislative session," Holcomb wrote. "I strongly suggest that [your company] focus its resources on participation in this study rather than continue illegal operations in the meantime."
Uber released the following statement to 13News Now:
The DMV’s actions today are shocking and unexpected. Uber has been providing Virginians with safe, affordable and reliable transportation options for months and has continued to work in good faith with the DMV to create a regulatory framework for ridesharing. The DMV decision today hurts thousands of small business entrepreneurs who rely on the Uber platform to make a living, create new jobs and contribute to the economy – and it hurts the countless residents who rely on Uber to connect them with affordable, safe and reliable transportation alternatives. We look forward to continuing to work with the Virginia DMV to find a permanent home for ridesharing in the Commonwealth.
Uber Technologies, Inc.