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Lyft will pay $25 million to settle claims it hid safety issues before its IPO

Lyft has agreed to pay $25 million to settle shareholders’ allegations that it did not disclose questions of safety in its Preliminary Public Providing (IPO) paperwork. In accordance with Reuters, shareholders accused the corporate of concealing recognized issues, comparable to sexual assaults by its drivers, to domesticate a picture of a extra socially accountable different to Uber. Additionally they accused Lyft of not disclosing questions of safety relating to its bikeshare program, particularly the issue the corporate confronted with its brakes that pressured it to tug its bikes from varied cities within the US. Whereas Lyft has agreed to settle, it denied any wrongdoing. In a press release despatched to CNN Business, firm spokesperson Gabriela Condarco-Quesada mentioned:

“This settlement resolves a shareholder class motion associated to statements in Lyft’s preliminary public providing and its monetary affect on buyers — it is not about safety-related claims on the platform.”

Of their grievance, the shareholders mentioned experiences of sexual assaults by Lyft drivers that got here out after the IPO represented an “existential threat” to the model that ought to have been disclosed beforehand. Additional, they mentioned Lyft used promotions to spice up its market share towards Uber. 

Lyft formally filed to go public in 2019, however it wasn’t till 2021 that it had revealed its first security report. In it, the trip—hailing agency revealed that it acquired a complete of 4,158 sexual assault experiences from 2017 till 2019. Lyft divided the circumstances in several classes for its report, with the commonest incidents falling beneath the non-consensual touching of a sexual physique half class. It is price noting, nonetheless, that the cash for this settlement will go to shareholders and to not any of the passengers who reported being sexually assaulted by the agency’s drivers.

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