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Uber Debuts Driverless Cars in San Francisco -- Without a Permit

Uber is acting illegally by operating self-driving cars in San Francisco and "must cease" until it gets a permit, according to a strongly worded letter sent by California's Department of Motor Vehicles on Wednesday.

By Carolyn Said

Uber is acting illegally by operating self-driving cars in San Francisco and "must cease" until it gets a permit, according to a strongly worded letter sent by California's Department of Motor Vehicles on Wednesday.

The DMV's letter to Uber came just hours after the ride-hailing company began a public trial of the futuristic cars in its hometown. Under the program, a handful of Uber's self-driving Volvo XC90s and Ford Fusions will be randomly assigned to paying riders to test public interactions with the cars. An Uber engineer will sit in the driver's seat, ready to take control.

The DMV requires a permit to use autonomous vehicles on public roads. Uber, which did not immediately respond to a request for comment, had previously argued that its technology was exempt.

"The rules apply to cars that can drive without someone controlling or monitoring them," wrote Anthony Levandowski, head of Uber's Advanced Technology Group, in a blog post published early Wednesday morning, before the DMV letter came out. "For us, it's still early days, and our cars are not yet ready to drive without a person monitoring them."

But the DMV disagreed. "It is illegal for (Uber) to operate its self-driving vehicles on public roads until it receives an autonomous vehicle testing permit," DMV chief counsel Brian Soublet wrote to Levandowski. Twenty companies, ranging from Google to small startups, have obtained the permits to test autonomous cars on California roads.

The clash recalls Uber's approach to regulations when it began offering its ride-hailing service in cities nationwide without permission from lawmakers. The company said it was exempt from rules governing taxis since hailing rides via smartphone from people driving their own cars made it fundamentally different.

"Roll back a few years, and public service commissions, taxicab (regulators), police and airport authorities were saying to Uber: 'Stop doing what you're doing; it's unlawful,'" said Bryant Walker Smith, a law professor at the University of South Carolina and expert on self-driving cars. "Sometimes it complied but often it did not." Ultimately many jurisdictions ended up legalizing ride-hailing services.

But this case is more extreme. California has several remedies, Smith said. "There are ways an agency could use existing law to make life difficult for a company that's not playing ball," he said. The DMV could seek a court injunction forcing Uber to stop the test, for instance. It could revoke the cars' vehicle registrations. The Highway Patrol could ticket the cars' drivers for reckless driving or driving with unsafe equipments. The DMV letter said legal action against Uber could include "seeking injunctive relief."

Smith said he sympathizes with Uber and other companies that feel California's rules are restrictive, but "nonetheless, I start as a lawyer with 'What is the law?' not 'What do I want the law to be?'"

Levandowski's blog post included an oft-repeated tech industry argument about rules stifling innovation and even a veiled hint that California could be hurting itself.

"Several cities and states have recognized that complex rules and requirements could have the unintended consequence of slowing innovation," he wrote. "Pittsburgh, Arizona, Nevada and Florida in particular have been leaders in this way, and by doing so have made clear that they are pro technology."

Getting a DMV permit to test autonomous cars is straightforward, requiring proof of $5 million in insurance and verification that test drivers are adequately trained. But companies must submit detailed reports on each vehicle deployed, any accidents and every time a driver had to take manual control of the car -- all information that is public. Uber, which is privately held, has resisted past attempts at regulation that would require public reports about its business.

"What is Uber's end game?" Smith said. "Is it making a legal argument now that it will build upon later to say its vehicles are still lawful (without a permit) if a driver is sitting in a call center 100 miles away?"

Besides the DMV clash, Uber's pilot program stirred up a storm of negative publicity on social media when a YouTube video emerged on Wednesday showing one of the retrofitted Volvos running a red light. Taken by a Luxor Cab dash cam and first reported by the Examiner, the video shows the distinctive car driving through a crosswalk on Third Street near SFMOMA about 3 seconds after the light turned red.

"This incident was due to human error," Uber said. "This vehicle was not part of the pilot and was not carrying customers. The driver involved has been suspended while we continue to investigate."

(c)2016 the San Francisco Chronicle

Caroline Cournoyer is GOVERNING's senior web editor.
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