Lyft's NYC Launch Party Goes Off Without a Hitch. The Launch? Not So Much.
Warehouse in an up-and-coming, trendy part of Brooklyn? Check. Live music performance by hip rapper Q-Tip? Check. Free booze? Check. San Francisco-based ridesharing company Lyft’s New York launch party was carefully planned and uber trendy (forgive the pun). If only the actual launch being celebrated had been so well planned. Womp. Womp.
Ridesharing app Lyft announced last week that it would be officially available in New York City on Friday. The service, which was going to premier in Brooklyn and Queens, was going to be available to New York City residents for free for two weeks. Late Friday afternoon, Lyft announced that no, actually, it was not going to launch as planned.
New York State Supreme Court declared the ridesharing company in violation of New York City Taxi and Limousine regulations and filed a temporary restraining order on it. The Court was adjourned until Monday. Lyft said that it had no opportunity to respond in Court before the weekend because of “a deliberate misstatement” on the part of the New York Attorney General and the Department of Financial Services, Lyft spokesperson Erin Simpson told Entrepreneur.com.
“We agreed in New York State Supreme Court to put off the launch of Lyft's peer-to-peer model in New York City and we will not proceed with this model unless it complies with New York City Taxi and Limousine regulations,” said Simpson. “This is a positive step forward and a good demonstration of compromise in balancing innovation with government regulation, and we appreciate the continued efforts of New York City government to find common ground for the betterment of New York.”
That’s hardly debatable. Innovators and regulators are often at loggerheads and so it’s encouraging to see them come to the table together. The part that’s hard to swallow is why would Lyft have officially announced a launch in New York City -- complete with careful planning of an curated and bumping launch party -- without having already had these conversations?
Feels a bit like a no brainer, guys. A company like Lyft, which is already operating in more than 60 cities around the country and proudly adorns cars in its fleet with oversized magenta mustaches, wasn’t going to slip into the Big Apple unnoticed.
Meanwhile, New York City lawmakers say they had reached out to Lyft multiple times to try to deal with the legal requirements of them launching in Brooklyn and Queens. "We pursued this action only after repeatedly offering to work with Lyft in order to ensure that its business practices complied with the law,” said Attorney General Eric T. Schneiderman and New York State Superintendent of Financial Services Benjamin M. Lawsky in a written statement released Friday. “Lyft’s arguments are a disingenuous attempt to disguise old-fashioned law-breaking that jeopardizes public safety.”
Lyft’s primary competition, Uber, says that it does meet New York City laws and that all of it’s drivers are registered with a local Taxi and Limousine Commission-regulated base or are Taxi and Limousine Commission-regulated taxis. Lyft, by contrast, was going to launch a ridesharing platform in New York City last week where drivers can pick each other up for rides without being registered with the Taxi and Limousine Commission. A petition to bring ridesharing to New York City currently has more than 6,000 digital signatures.
Uber says it will eagerly charge forward into the ridesharing space if that becomes an option.”Due to TLC regulations Uber does not currently have a ridesharing platform in New York. If regulators embrace ridesharing with a relaxed approach to licensing and enforcement with other companies, Uber will be excited to launch our ridesharing platform soon in the state of New York,” said Uber in a statement emailed to Entrepreneur.com.
Wonder if Uber’s popping the champagne already?
Catherine Clifford is senior entrepreneurship writer at CNBC. She was formerly a senior writer at Entrepreneur.com, the small business reporter at CNNMoney and an assistant in the New York bureau for CNN. Clifford attended Columbia University where she earned a bachelor's degree. She lives in Brooklyn, N.Y. You can follow her on Twitter at @CatClifford.