Taxi warfare: Uber drags Ola to court over 'false bookings'

US-based ride hailing firm accuses rival of making false bookings on its platform, drags it to Delhi High Court

American taxi-hailing app Uber and its Indian counterpart Ola, often intensely competing with each other on discounts and service, are now caught in a legal battle over alleged fake bookings.

Uber moved the Delhi High Court on Tuesday, accusing Ola of making false bookings on its platform. Demanding Rs 49.61 crore in damages, Uber alleged that Ola set up fake rider accounts, misled its drivers via fake calls impersonating Uber and gave misleading information. Bengaluru-based Ola, which has the highest share in the taxi-app space with Uber catching up fast, has denied the allegations. In view of the submission made by Ola, judge Vipin Sanghi directed it to abide by its statement and listed the matter for further hearing on September 14.

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“Defendants (Ola and its subsidiary Serendipity Cabs) emphatically deny the allegations. Counsel for defendants states they have not done anything to interfere with plaintiff’s (Uber) business as alleged, or its system by making false accounts, bookings or cancellations... nor has any intention of doing so. Defendants, their agents and employees shall abide by this statement,” the court said.    

WAR ON WHEELS
Gloves off between Uber, Ola

NUMBERS DON’T ADD UP

• 50% Uber’s claimed India market share
• 75% Ola’s purported market share

VALUATION

• $60 bn Uber’s estimated worldwide valuation. US-based ride-hailing company seen as one of the most valuable start-ups. No separate estimate available for India entity
  $5 bn SoftBank-backed Ola’s valuation

PROJECTION OF TAXI APP MARKET IN INDIA:

• $7 bn in 2020

Sources: Companies, industry estimates

It also issued notice to Ola and Serendipity asking them to file their written statement, reply and submit documents within four weeks.

According to sources, Uber in its petition alleged that Ola created as many as 93,859 false rider accounts on the US major's technological platform by stating fake names, e-mail IDs and untraceable phone numbers.

"The company alleges that Ola made 405,649 false bookings of taxi rides and thereafter cancelled them to create frustration and disrupt business. Also, according to Uber, Ola's employees impersonated Uber officials and circulated damaging text messages," said sources.

Uber has claimed that at least 20,000 drivers have left the company's platform owing to these reasons. According to Uber, it has paid around Rs 5 lakh as cancellation charges and alleged that by making false bookings, Ola was squatting on the cabs associated with Uber.

Meanwhile, Ola told the court that Uber's plea is the direct result of a contempt petition it has filed against the latter accusing the US-based taxi aggregator of not complying with court directions to phase out diesel cabs.

ON A COLLISION COURSE

• February 2016: A contempt of court plea was filed by Ola Cabs against Uber, claiming that the US giant flouted court’s earlier directives and is still adding and plying diesel vehicles in Delhi.
  Uber India, on the other hand, accused Ola of submitting “false and fabricated” documents to the court for achieving “illegal business gains”
• March 2016: Ola launched a new class of ‘Micro’ cabs, which have a base fare ranging from Rs 35 to Rs 45, at rates of Rs 6/km. The launch of the new fleet was seen as an attempt to undercut the prices of UberGo, Uber’s cheapest class of cab available in the country, which ranges from Rs 6 to Rs  8/km.
• March 2016: On the very same day Uber launched its bike taxis ‘uberMoto’, Ola announced that it has launched its pilot ‘Bike Taxis’  in Bengaluru. Sources said that Ola purposely coincided its launch with Uber.

"All the allegations made by Uber in the plaint listed for hearing before Delhi High Court are denied in their entirety and we have apprised the court accordingly that the allegations by Uber are frivolous and false to its own knowledge," Ola stated.

"We can only speculate this is a counter to the contempt proceedings pending against Uber in the high court... This is an effort to divert attention from the current realities of the market where Uber has faced major setbacks including the recent incidents of its vehicles being seized by government authorities. We stand by our contempt petition that Uber has been plying new diesel vehicles within Delhi in wilful and deliberate defiance of the local rules and regulations," Ola stated.