Calif. Shared Mobility Bill Amended to Remove Liability Waiver Ban

On Tuesday, the California legislature amended assembly bill AB 1286, after shared mobility providers and other groups opposed a provision in the bill that would prohibit liability waivers in shared mobility device agreements, claiming that the provision would “threaten the existence” of shared mobility providers in California; the amended version of the bill removed this provision. The bill was introduced by Assemblymember Al Muratsuchi in February 2019 and passed in May 2019; it passed a committee vote in the Senate last week, which propelled shared mobility providers, such as Uber, Lyft, and Lime to act.

The earlier version of the bill included language that would prohibit e-scooter and bike providers from using liability waivers, which the companies stated, in effect, would force them to shut down. Specifically, the bill stated “(t)he shared mobility provider agreement between the provider and a user shall not contain a provision by which the user waives, releases, or in any way limits their legal rights or remedies under the agreement.”

“As COVID is prompting many Californians to rethink how they get around, this change is a powerful acknowledgement that shared bikes and scooters are here to stay in our cities,” Sam Sadle, Senior Director for Government Relations at Lime, said in a statement to The Verge. “We look forward to continuing to work with cities and the state to encourage open-air, socially-distanced, and sustainable transportation options going forward.”

Last week, the California Senate performed an analysis of the bill that pointed out shared mobility providers’ strong opposition to the bill. The analysis also stated that “such waivers are generally permitted and widely used,” but the waivers must be “clear, unambiguous, and explicit.”

The bill is designed to prevent shared mobility providers from deploying scooters and bikes before a clear set of rules and guidelines have been created by authorities. For example, it sets a standard insurance minimum and requires mobility providers to obtain a permit with governing cities and counties. The bill would also require governing cities and counties to “adopt operation, parking and maintenance rules…before the provider may offer shared mobility devices for rent or use.”

“E-scooters and other shared mobility devices can be fun, affordable, and eco-friendly ways to get around,” Assemblymember Muratsuchi said. “However, like any new innovation, we need to make sure it is safe both for users and for pedestrians, with basic consumer protections. This bill would protect consumers of these services as well as the general public by requiring cities and counties to adopt basic safety rules, as well as providing for consumer protections that would protect users and third parties in the event of an injury.”

Shared mobility providers were concerned that without the liability waivers, they could be held liable for a variety of injuries and accidents, ranging from poorly kept roads to reckless or negligent driving. This could cause shared mobility providers to face a litany of personal injury litigation, despite some users already suing for personal injury with the waiver. Recently, Lime was sued in a California State Superior Court for riders’ personal injuries, which the plaintiffs claimed came from scooter defects, including failure to maintain or issues with brakes, throttle, wheels, and handlebars, and injuries caused by geofencing.

The City of San Jose, the City of Oakland and the San Francisco Bay Area Planning and Urban Research Association (SPUR) opposed the bill unless it was amended. A variety of other organizations and shared mobility providers wrote to the legislature to oppose the bill and pinpointed the portions of the bill that they found problematic. SPUR stated that the bill would “threaten the existence of shared micromobility services in California…by subjecting them to intolerable and unfair levels of liability exposure and making it financially unviable to operate.” SPUR noted that no other industry in California has this standard, adding that rental car companies have renters sign a liability waiver and the federal Graves Amendment protects rental car companies from vicarious liability. The opposers noted that not having the liability waiver would raise insurance costs, which would also raise prices for consumers. They also felt that publicly run or contracted micromobility services should be exempt from the bill, noting that the increase in prices would hurt this system and impact low-income Americans who rely on these transportation methods.

The organizations noted that the bill’s provision could unintentionally destroy the micromobility and shared mobility industry in California. They noted that micromobility has become important during the COVID-19 pandemic and that “(o)ther cities around the world have recognized this phenomenon and are rushing to expand access to clean, socially distant micromobility. But AB 1286 would instead legislate it out of existence, sending California down a regressive path and adding tens of millions of car trips each year to our cities’ streets.” Bike advocates also felt the bill would “stifle the growth of a thriving industry at a time when the state is in the greatest need of these services.”