Lyft Settles DOJ Lawsuit for $2.1 Million

Lyft has agreed to pay a $2.1 million settlement to resolve allegations from the Department of Justice (DOJ) and the Federal Trade Commission (FTC) for misleading drivers about potential earnings during the pandemic. The lawsuit claimed Lyft exaggerated earnings, advertising hourly rates of over $40 in major cities, based on the income of only the top 20% of drivers, thus creating unrealistic expectations for the majority. The settlement includes a permanent injunction preventing Lyft from engaging in similar deceptive practices in the future. DOJ officials emphasized their commitment to protecting gig economy workers from misleading claims about earnings. Under new CEO David Risher, Lyft has begun implementing changes to improve transparency regarding driver compensation. This settlement highlights ongoing regulatory scrutiny in the gig economy, particularly concerning fair advertising practices.