Turo Fires Back Against the City of San Francisco Lawsuit

A lawsuit claims the car-sharing company is getting around the city's airport permit system and Turo is not backing down.

Turo

Turo, known as the Airbnb for cars, is coming under fire. The City of San Francisco has filed a lawsuit on behalf of the San Francisco International Airport (SFO). In the suit, City Attorney, Dennis Herrera claims that the internet-based car company is getting around the airport's permit system. The system's official purpose is to help control traffic congestion, enhance safety for travelers and maintain airport facilities. Turo is firing back and has responded to Herrera's claims.

Herrera claims that Turo has been operating at the airport without the required permits for rental car companies. According to Herrera, the car-sharing company gave up its SFO permit on Aug. 10, 2017, but has continued to operate without the required permits. 

“Turo executives seem to think the rules don’t apply to them,” Herrera said. “They seem to think traffic congestion is someone else’s problem, and that their company doesn’t need to pay its fair share for the public facilities it is profiting off of. They couldn’t be more mistaken.” 

The city is seeking "a court order prohibiting Turo from engaging in rental car transactions at SFO; making reference to SFO on its website, mobile application, or other promotional materials; and encouraging or facilitating SFO transactions in any other manner until Turo fully complies with SFO’s permit and fee requirements. The lawsuit also seeks civil penalties of up to $2,500 per violation, reimbursement for costs from the lawsuit and other relief."

Herrera's main claim against Turo is that it is a rental car company and subject to the fees and permits as other rental companies. Turo, however, makes a firm statement that Turo is not a rental car company. Turo does not own a fleet of cars. It allows everyday car owners to offset the cost of car ownership by providing a forum to rent out their cars. Turo claims that it should not have to comply with the fees of normal rental car companies. Imposing them would cause the fees to fall back on the car owners who host their cars. 

"Turo is a car sharing platform, not a rental car company under both California and federal law.  We plan to fight this suit aggressively," Michelle Fang, chief legal officer at Turo, told The Drive.

In 2010, California's legislature amended the California Insurance Code to recognize personal vehicle sharing programs such as Turo as a separate entity, separate from a rental car company. Turo mentioned that SFO's arm may be twisted by rental car companies which contribute to more than 12 percent of the airport's operating revenue, but by taking this path it is ignoring precedents set by the California legislature. 

The case of People of The State of California v. Turo Inc., San Francisco Superior Court Case No. CGC-18-563803 was filed on Jan. 24, 2018.