When Uber opens for business in Western New York in a few weeks, the ride-sharing company will be bringing a host of legal and ethical issues with it.
In fact, the issues could be “existential,” said Matthew Pelkey, an attorney at Colligan Law LLP who works with local startups.
Issues range from workplace claims of harassment and discrimination to running afoul of the New York State Joint Commission on Public Ethics. The sheer amount of issues the company faces is “shocking,” he said.
“This could go down as one of the best examples of how not to run a company,” he said, “short of defrauding investors.”
The state ethics commission recently announced that it reached a settlement with Uber after the company failed to disclose more than $6 million in lobbying expenses in 2015-16.
Uber agreed to pay a fine of $98,000, according to the commission. The settlement is the largest reached under the commission’s compliance program.
According to reports about the fine, Uber disclosed $3.1 million in expenses when the actual number was closer to $9.4 million. Most of the spending was for an advertising campaign geared toward regulations in New York City, where Mayor Bill de Blasio pressed legislation to check the growth of the company’s app.
According to the settlement, Uber cooperated fully with the commission and attributed the nondisclosure to an error by a filing firm used by the ride-sharing company. Uber also made a mistake in reporting the expenses, the settlement said. The company has updated its filings with the commission.
In a statement, Uber said it no longer uses the third-party company to manage its state filings.
“We updated our reports because there were unintentional omissions from our initial disclosures,” the company said. “Uber NY has revised its processes and no longer uses the third-party filing firm who prepared these disclosure statements.”
Last week, Gov. Andrew Cuomo announced new regulations for the rollout of ride-sharing services across the state as of June 29.