SF’s Yellow Cab blames lawsuits, Uber and Lyft for bankruptcy
The Examiner explained that self insurance lifts certain insurance caps, allowing lawsuits filed against the Co-op to reach exorbitant amounts. For instance, it paid $14.5 million for one lawsuit filed in 2006 and, more recently, $8.5 million to settle another wherein a Yellow Cab crash left a woman partially paralyzed.
Martinez also admitted that the rise of Uber and other ride-sharing companies greatly affected the company. But what really drove the final nail in its coffin is the loss of its drivers (and hence, revenue) to those ride-sharing rivals. “[That] drained Yellow Cab’s remaining equity,” Martinez wrote. Despite filing for Chapter 11, the Co-Op will continue to be operational. The filing will allow it to restructure its debts in an effort to get back into the game.
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