New York City has filed a lawsuit seeking to shut down Empower, a ride-hailing service accused of operating without proper Taxi & Limousine Commission (TLC) licensing.
City lawyers filed court papers Friday in Manhattan state court against Yazam Inc., alleging that the Empower app has been “flagrantly flouting” the law since 2022 by operating as an unlicensed dispatcher of for-hire vehicles. “New York City will not tolerate companies that flout the law while putting drivers, passengers, and the public at risk,” stated Steve Banks, the city’s corporation counsel.
The lawsuit follows similar legal challenges for Yazam and its chief executive, Joshua Sear, who is facing millions of dollars in fines in Washington D.C. For being in contempt of a 2024 court order to cease operations. Empower has repeatedly clashed with the TLC, which regulates the city’s taxi and for-hire vehicle industry, by failing to comply with regulations regarding taxes and surcharges.
The TLC has warned drivers that they risk losing their licenses and facing fines of up to $500 for using “unlicensed software platforms.” Vehicle owners could face fines up to $10,000. The TLC issued a cease-and-desist letter to Empower in May 2022, followed by another on March 18, urging the company to deactivate the app and apply for a For-Hire Vehicle Base license.
Jason Kersten, a TLC spokesperson, stated, “We will not gaze the other way while illegal operators undermine our laws, exploit drivers, and put passengers at risk.”
Court papers reveal that TLC enforcement agents flagged Empower 32 times for unlicensed activity in 2022 and 2023, and another 38 violations have been issued since February 4 of this year. Empower allows drivers to set their own rates and retain 100% of the fare, a model Sear has described as allowing drivers to “truly run their own businesses.”
Sear testified on March 12 that Empower had provided over 100,000 rides in New York City in the prior week. He also discussed bringing on David Do, the TLC’s recent commissioner, as Empower’s senior vice president of government and regulatory affairs, though Do later decided against the position.
The lawsuit coincides with a review of potential violations by the office of state Attorney General Letitia James. City Councilmember Shaun Abreu stated that Empower is failing to collect legally required fees and taxes, including congestion pricing charges. Valdivia, the new TLC commissioner, has vowed to shut down Empower.
Notice currently more than 115,000 TLC-licensed vehicles, including over 82,000 high-volume for-hire vehicles, such as those operated by Uber.
Frequently Asked Questions
What is Empower accused of doing?
Empower is accused of operating as an unlicensed dispatcher of for-hire vehicles in New York City since 2022, violating the city’s licensing laws and regulations.
What is the TLC’s position on Empower?
The TLC has warned drivers that using Empower could result in the loss of their licenses and fines, and has issued multiple cease-and-desist letters to the company.
What does Empower offer drivers?
Empower allows drivers to set their own rates and keep 100% of the fare, requiring them to pay a subscription fee to leverage the service.
Will Empower be able to continue operating in New York City given the current legal challenges?
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