The city took Empower to court Friday, filing suit in Manhattan state court against Yazam Inc., the company behind a ride-hailing app that offers cheaper fares than Uber and Lyft but has operated without a license since 2022.
City Corporation Counsel Steve Banks said the company has been “flagrantly flouting” Taxi and Limousine Commission regulations for years. “New York City will not tolerate companies that flout the law while putting drivers, passengers, and the public at risk,” Banks said in a statement. “As detailed in our complaint, Empower has been conducting business in clear violation of New York’s licensing laws and other regulations, and we are seeking relief to halt these unlawful practices.”
The lawsuit is the sharpest move yet in a prolonged standoff between the city and Yazam CEO Joshua Sear. The company is also in serious legal trouble in Washington D.C., where it faces millions of dollars in fines for contempt of a 2024 court order that told it to stop operating there entirely.
The TLC’s complaint against Empower centers on a straightforward charge: the company has been dispatching for-hire vehicles in the five boroughs without holding the required base license. Under city rules, platforms that connect drivers with passengers must collect per-trip taxes and surcharges. Empower has not done that.
TLC issued its first cease-and-desist letter to the company in May 2022. It sent another one as recently as March 18, urging the company to deactivate the app and contact the commission to begin the licensing process. Empower has not complied.
Court papers show TLC undercover enforcement agents flagged Empower 32 times for unlicensed activity in 2022 and 2023. The company ignored every one of those violations, resulting in default judgments against it. Since February 4 of this year, TLC has issued another 38 violations.
“Empower ignored each of these violations, resulting in default judgments against it,” the complaint states. “At no time has Empower sought to respond to, or dispute, any of these violations.”
TLC spokesperson Jason Kersten did not mince words. “We will not look the other way while illegal operators undermine our laws, exploit drivers, and put passengers at risk,” Kersten said. “This action against Empower sends a clear message: if you operate in this city, you must play by TLC rules.”
The commission has also put drivers on notice. Any TLC-licensed driver who signs on with Empower risks a fine of up to $500 and the potential loss of their license. Vehicle owners who connect with the service could face fines of up to $10,000. TLC has characterized platforms like Empower as “unlicensed software platforms that serve as bases by connecting drivers with trips.”
Empower launched in 2020 and markets itself as a driver-friendly alternative to the major ride-hailing companies. Sear has argued that the app lets drivers “truly run their own businesses” by charging a flat subscription fee rather than taking a percentage of each fare. The company also operates in Baltimore, South Florida, and the Winston-Salem and Greensboro area of North Carolina.
The pitch clearly resonates with some drivers who feel squeezed by Uber and Lyft. But operating cheaper does not entitle a company to skip the regulatory structure that governs the industry. That structure exists for reasons that go beyond bureaucratic convenience. Per-trip surcharges fund the city’s congestion pricing program and support the Metropolitan Transportation Authority. The TLC licensing process ensures baseline accountability for both drivers and passengers.
What Empower has done, by ignoring violation after violation and two separate cease-and-desist orders over four years, is treat New York City as a test case for how long a company can run an unlicensed operation before anyone forces it to stop. The city is now answering that question in court.
The lawsuit seeks to halt Empower’s operations in New York entirely. A hearing date has not yet been publicly announced.
