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`COOLEY LLP
`ATTORNEYS AT LAW
`SAN FRANCISCO
`
`
`
`COOLEY LLP
`MICHAEL G. RHODES (116127)
`(rhodesmg@cooley.com)
`MATTHEW D. BROWN (196972)
`(brownmd@cooley.com)
`BENJAMIN H. KLEINE (257225)
`(bkleine@cooley.com)
`BETHANY C. LOBO (248109)
`(blobo@cooley.com)
`MAX A. BERNSTEIN (305722)
`(mbernstein@cooley.com)
`101 California Street, 5th Floor
`San Francisco, CA 94111-5800
`Telephone: (415) 693-2000
`Facsimile: (415) 693-2222
`Attorneys for Plaintiff
`TURO INC.
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`WESTERN DIVISION
`
`TURO INC.,
`
`Plaintiff,
`
`v.
`CITY OF LOS ANGELES,
`Defendant.
`
`
`
`Case No. 2:18-cv-6055
`COMPLAINT OF TURO INC. FOR
`DECLARATORY JUDGMENT AND
`OTHER RELIEF
`
`DEMAND FOR JURY TRIAL
`
`
`Plaintiff Turo Inc. (“Turo”) alleges as follows:
`PRELIMINARY STATEMENT
`1.
`Turo is a software company that provides its community of users a
`platform to share their personal cars. As California law makes clear, Turo is not a rental
`car company because it does not own or rent a fleet of cars. In stark contrast, Turo
`operates a website1 and mobile-device app platform through which users engage in
`
`1 Turo’s website can be found at https://turo.com/.
`COMPLAINT OF TURO INC. FOR DECLARATORY
`1.
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`ATTORNEYS AT LAW
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`personal vehicle sharing. That is, Turo allows users to connect with each other. Turo
`works as follows: Owners list their privately-owned cars on Turo, indicating
`availability, price, and options for pickup. Users seeking a car (“guests”) use Turo to
`search listings, select and book a car, and arrange with the car’s owner to pick it up at a
`mutually-agreed time and place.
`2.
`Turo’s technology has benefitted the public by revolutionizing short-term
`car use. Turo helps car owners, from students to retirees, turn idle cars into an income
`source. Guests, in turn, love Turo because it gives them access to a wide selection of
`privately-owned cars with a superior user experience.
`3.
`The California legislature has embraced this innovative “sharing
`economy” model by amending the Insurance Code to recognize “personal vehicle
`sharing program[s]” as a new kind of entity, distinct from rental car companies (users
`of Turo’s personal vehicle sharing program2 are called “Users” herein). Cal. Ins. Code
`§ 11580.24. California is not alone: Oregon, Washington, and Maryland have enacted
`similar laws to promote peer-to-peer car sharing and to clarify responsibilities in
`connection with such car sharing. See Or. Rev. Stat. §§ 742.585-742.600; Wash. Rev.
`Code §§ 48.175.005-48.175.900; S.B. 743, 2018 Reg. Sess. (Md. 2018).
`4.
`Californians love Turo. Hundreds of thousands of Californians are Turo
`Users, and more than 10,000 California car owners have listed their vehicles for sharing
`on Turo.
`5.
`Some Users coordinate through Turo’s platform to exchange cars at or near
`Los Angeles International Airport (“LAX”), which is owned by the City of Los Angeles
`(the “City”). Because of these User exchanges, the City asserts that Turo must obtain
`an LAX rental car company permit. This makes no sense as Turo is a software company
`and website operator, not a rental car company.
`
`2 Turo has other offerings beyond providing a personal vehicle sharing platform, and it
`plans to offer additional verticals in the coming year. However, its personal vehicle
`sharing line of business is the subject of this lawsuit.
`COMPLAINT OF TURO INC. FOR DECLARATORY
`2.
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`6.
`Pursuant to the rental car company permit, the City would require Turo
`and its Users to pay exorbitant charges designed for rental car companies operating at
`LAX. Specifically, on information and belief, the City would charge Turo and its Users
`meeting at or near the LAX ten percent of each booking (the “Gross Receipts Charge”).
`This would be a pure revenue grab from local car owners that is totally unconnected to
`any benefit provided to, or service used by, Turo and its Users, or any supposed burden
`those Users cause by exchanging cars at or near LAX.
`7.
`Remarkably, this is not the only fee that the City seeks to impose. It also
`seeks a per-transaction “Customer Facilities Charge” meant to finance rental car
`infrastructure at the airport (the “LAX Facilities Charge”). On information and belief,
`the LAX Facilities Charge is calculated as $7.50 per day for the first five days of a car
`rental. If applied to a five-day Turo car share, it would require Turo and its Users to
`make a costly $37.50 payment to LAX—more than the price many travelers pay for
`private ground transportation from LAX to their final destination.
`8.
`For a week-long car share that costs a guest $500, this amounts to an eye-
`popping $87.50 in additional charges ($50 for the Gross Receipts Charge and $37.50
`for the LAX Facilities Charge)—all for simply exchanging keys at the LAX curb.
`By contrast, Uber and Lyft users pay LAX a mere $4 to meet cars curbside at the same
`LAX terminals. Limousines and taxis likewise meet passengers curbside and require a
`staging area, yet pay only $4 (limousines) or $5 (taxis) per trip. In other words, the City
`irrationally seeks to charge Turo and its Users ten or even twenty times as much as
`others who use similar or greater LAX resources.
`9.
`These exorbitant charges are not only arbitrary and unjust, but illegal. As
`an initial matter, LAX has threatened to sue Turo for the decision of its Users to meet
`at or near LAX. But such an action would run afoul of federal law, specifically the
`immunity provided by the Communications Decency Act, 47 U.S.C. § 230. Turo in no
`way requires that owners offer, or guests select for, LAX delivery—any such exchanges
`are arranged by the Users themselves. The Communications Decency Act thus provides
`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`ATTORNEYS AT LAW
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`that Turo, an online platform that publishes the selections and offerings of its Users,
`cannot be liable for such publication or for User conduct stemming from the same.
`10. Moreover, under California Government Code § 50474.3, the LAX
`Facilities Charge can only be charged to rental car companies, which excludes both
`Turo and its Users. In fact, the LAX Facilities Charge is collected specifically to finance
`construction of a behemoth “Consolidated Rent-a-Car Facility,” which will provide a
`wide range of expensive services to rental car companies and their customers. On
`information and belief, it will feature 30+ car washing bays, 60+ car maintenance bays,
`180+ refueling stations, and 17,000+ stalls for rental cars—as well as over 100,000
`square feet of customer service counters, booths, back-office space for rental car
`companies, and customer lobbies. But Turo is democratizing car sharing, allowing
`Users to bypass this precise manner of expensive overhead and share cars directly with
`one another using nothing more than an online app or website. Accordingly, Turo Users
`require none of the Consolidated Rent-a-Car Facility’s amenities and will never need to
`visit this sprawling facility for any purpose. Imposing the LAX Facilities Charge on
`Turo and its Users is thus unfair and unlawful under Government Code § 50474.3, and
`not rationally related to the purpose for which the fee is being collected.
`11. Both the Gross Receipts Charge and LAX Facilities Charge are also
`unconstitutional because they are unapproved taxes. In 2010, California voters enacted
`Proposition 26 (the “Stop Hidden Taxes Initiative”), which amended Article XIII C of
`the California Constitution to require that any “fee” charged by a local government bear
`a reasonable relation to the cost of the service covered by the fee. Any “fee” that fails
`this reasonable relation test is not legally a fee, but a tax that California voters are
`entitled to approve or reject. Both of LAX’s proposed charges fail the reasonable
`relation test as applied to Turo and its Users, and voters have never approved either.
`Thus, it is unconstitutional for the City to impose these charges on Turo and its Users.
`12. These arbitrary charges also violate the “dormant” commerce clause of
`Article I, Section 8 of the United States Constitution and the equal protection clauses of
`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`the Fourteenth Amendment to the United States Constitution and Article I, Section 7 of
`the California Constitution. The City has ignored the fact that these constitutional
`provisions prohibit it from (a) imposing an undue burden on interstate commerce by
`imposing exorbitant charges that are not actually related to any benefit provided to or
`service used by Turo and its Users; and (b) discriminating against Turo and its Users
`via charges that are dramatically higher than those imposed on businesses that use
`airport property in a similar manner.
`13. Turo would have preferred cooperation with LAX over litigation. Turo’s
`CEO, Andre Haddad, has repeatedly asked to meet with LAX executives to work
`towards an amicable resolution, but LAX has refused to meet with him even once. Turo
`is prepared to (a) submit to a permitting regime appropriate for its business model as a
`personal vehicle sharing program; and (b) pay reasonable fees to LAX, similar to those
`charged to TNCs or taxis. But LAX has refused even to engage with the idea of
`developing an appropriate permit for Turo and other personal vehicle sharing programs,
`instead arbitrarily (and incorrectly) insisting that Turo is a rental car company and must
`be permitted as one. Indeed, LAX has aggressively cited Turo Users exchanging cars
`at the airport, sometimes even impounding their cars without cause.
`14. Turo is committed to protecting its community of Users and itself from
`arbitrary, unfair, unreasonable, and unlawful charges and LAX’s aggressive, misplaced,
`and unconstitutional enforcement efforts. Given no other choice, Turo brings this
`lawsuit. Specifically, Turo seeks to ensure that its new approach to peer-to-peer car
`sharing is not stymied by heavy-handed regulations meant to protect the interests of the
`large national car rental companies, to the detriment of entrepreneurial local residents
`looking to offset the high cost of car ownership in California by taking advantage of the
`economic opportunity Turo’s platform provides. Turo asks the Court for a judicial
`declaration that:
`(a) The City cannot hold Turo, an online platform, liable for its Users’
`decisions to meet at or near LAX. Any such attempt would run afoul of immunity
`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`afforded online entities by the Communications Decency Act, 47 U.S.C. § 230;
`(b) Because Turo is not a rental car company, Turo and its Users cannot
`be compelled by the City to pay LAX charges that only apply to rental car companies;
`(c) The City’s attempts to impose the Gross Receipts Charge and LAX
`Facilities Charge on each booking made via Turo are unlawful as unauthorized taxes in
`violation of California Constitution, Article XIII C;
`(d) The City has violated the “dormant” commerce clause of the United
`States Constitution because the charges that the City is attempting to extract from Turo
`and its Users pose an undue burden on interstate commerce, are excessive in relation to
`the benefits conferred, and are not based on any fair approximation of Turo or its Users’
`use of LAX’s facilities; and
`(e) The City has violated the equal protection clauses of the California
`and United States Constitutions because it unlawfully discriminates against Turo and
`its Users by imposing charges that far exceed the amount LAX assesses against
`similarly-situated companies and their users without any rational basis.
`LAX Takes Direction from National Car Rental Companies
`15. The campaign to misclassify Turo as a rental car company began with
`Enterprise Rent-a-Car and its parent, Enterprise Holdings (together, “Enterprise”).
`Enterprise is a powerful player that also owns Alamo Rent a Car and National Car
`Rental and controls 37 percent of the airport car rental market.3 Enterprise views Turo
`as an existential threat and has gone on the offensive to exclude Turo and its Users from
`airports nationwide.
`
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`3 ENTERPRISE HOLDINGS, Enterprise, National, and Alamo Brands Earn Top Three Spots
`in J.D. Power 2016 Rental Car Satisfaction Study (Nov. 10, 2016), available at
`https://www.enterpriseholdings.com/en/press-archive/2016/11/enterprise_national_
`and_alamo_brands_earn_top_three_spots_in_jd_power_rental_car_satisfaction_study.
`html (last visited July 11, 2018).
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`COOLEY LLP
`ATTORNEYS AT LAW
`SAN FRANCISCO
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`COMPLAINT OF TURO INC. FOR DECLARATORY
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`16. Enterprise has launched a multi-pronged attack on Turo, lobbying for
`damaging legislation in state legislatures and aggressively pressuring airports to stifle
`Turo however possible. Documents show Enterprise doing just that at LAX. In
`September 2017, an Enterprise representative emailed LAX to discuss approaches to
`limiting car sharing via Turo at airports. Shortly thereafter, in November 2017, a
`“contingent from Enterprise” met with an airport advocacy firm that represents LAX,
`with the specific purpose of “discuss[ing] Turo and the collection of fees at airports[.]”
`Enterprise explained at this meeting that it was planning to lobby for legislation that
`would subject Turo to regulations meant to govern rental car companies. By February
`2018, an Enterprise representative emailed LAX, seeking updates on Turo and lists of
`entities with and without LAX rental car permits. LAX obliged and diligently reported
`to Enterprise that “the Los Angeles City Attorney is pursuing litigation against Turo[.]”
`These emails show that LAX officials treat Enterprise not as a permitted entity under
`their regulatory purview but instead as a patron LAX takes instructions from and
`actively attempts to protect from competition.
`17. This is particularly disconcerting, given that LAX refuses even to meet
`with Turo. Tellingly, LAX and its representatives appear to have held more meetings
`with Enterprise than with Turo regarding how to regulate Turo. And what Enterprise
`wants is clear: to stifle Turo’s innovative model and, more generally, pro-consumer
`competition through regulation and litigation, to the detriment of taxpayers.
`18. LAX is unduly attentive to Enterprise’s demands for a reason. While
`Enterprise is increasingly outmoded from consumers’ vantage point, it still wields
`enormous influence as the largest rental car company in America. It exerts its power
`through armies of paid lobbyists, expansive political donations, and its own political
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`COMPLAINT OF TURO INC. FOR DECLARATORY
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`action committee, spending millions of dollars to advance its interests at each level of
`government.4 Enterprise spent over $850,000 on federal lobbyists alone in 2017.
`19. The Hertz Corporation has similarly sought to destroy Turo. The Hertz
`Corporation is a subsidiary of Hertz Global Holding Inc., which owns Thrifty Car
`Rental and Dollar Rent a Car (collectively, “Hertz”), which collectively account for a
`significant share of the airport rental car market. Hertz, like Enterprise, employs
`lobbyists to control legislation and regulatory policies. Through these methods,
`Enterprise and Hertz have secured lavish tax loopholes worth billions of dollars per year
`to the rental car industry and favorable regulatory environments. Like Enterprise, Hertz
`views Turo as an existential threat and seeks to use its influence to regulate, tax, or
`litigate Turo out of the airport market.
`20. Both Enterprise and Hertz have recently lobbied statehouses across the
`country, including in California, Maryland, Massachusetts, Hawaii, Missouri, and
`Utah, to pass laws that would define Turo and other peer-to-peer car sharing companies
`as rental car companies under state law—thus tacitly admitting that Turo is not a rental
`car company under current laws.
`21. Under pressure from these national rental car companies, the City has
`threatened to spend taxpayer money on a lawsuit against Turo that would benefit
`Enterprise and Hertz above all others. But contrary to the wishes of Enterprise and
`Hertz, the City cannot legally hold Turo, an online platform, responsible for such User
`conduct—let alone regulate Turo as if it were a rental car company or impose unlawful
`charges on Turo and its community of Users.
`PARTIES
`22. Turo Inc. is a Delaware corporation with its headquarters in San Francisco,
`California.
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`4 See FEDERAL ELECTION COMMISSION, Enterprise Holdings, Inc. Political Action
`Committee Financial Summary, available at https://www.fec.gov/data/committee/
`C00219642/ (last visited July 11, 2018).
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`COOLEY LLP
`ATTORNEYS AT LAW
`SAN FRANCISCO
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`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`23. The City of Los Angeles (the “City” or “Defendant”) is a city located in
`southern California. The City owns and operates LAX through the Los Angeles World
`Airports, which is governed by the Board of Airport Commissioners.
`JURISDICTION AND VENUE
`24. This Court has jurisdiction of this action under 28 U.S.C. § 1331 because
`Turo alleges violations of its rights under the Constitution and laws of the United States.
`25. This Court has supplemental jurisdiction over those claims arising under
`California law pursuant to 28 U.S.C. § 1367.
`26. The Court may declare the legal rights and obligations of the parties in this
`action pursuant to 28 U.S.C. § 2201 because the action presents an actual controversy
`within the Court’s jurisdiction.
`27. This Court has personal jurisdiction over Defendant, because Defendant
`resides in California and has its principal place of business in California.
`28. Venue is proper under 28 U.S.C. § 1391 because Defendant is located and
`resides in this judicial district and in the State of California, and because a substantial
`part of the events giving rise to Turo’s claims for relief occurred in this judicial district.
`ADDITIONAL STATEMENT OF FACTS
`Turo Brings Short-Term Personal Car Sharing to the Sharing Economy
`29. Turo (formerly RelayRides) was founded in April 20095 by a Harvard
`Business School student named Shelby Clark:
`
`It was Thanksgiving Day in 2008, and I needed to rent a Zipcar. It
`was snowing, and I had to bike 2 1/2 miles through Boston snow
`to get to a car. “I passed hundreds of cars on the road that had
`clearly not been driven for weeks, and that was when the light bulb
`went on. I thought: ‘Wait a minute! I should be taking one of those
`cars!’”
`
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`5 Turo did not operate in California before December 2010.
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`30. Clark researched insurance and technologies and surveyed the marketplace
`to see whether others were interested in sharing their cars. Then, in April 2009, he
`founded RelayRides, the first peer-to-peer sharing service. Unlike fleet-based services
`like Zipcar, RelayRides allowed individual car owners to share their vehicles.
`31. Clark envisioned a platform that would pair people who have spare cars
`with those willing to pay reasonable fees to use them. Every day, hundreds of thousands
`of cars sit unused in America; American cars remain parked over 95 percent of the time.
`Turo, as an innovator in the sharing economy, provides an elegant solution to this waste.
`Its model makes sense for car owners and drivers. As the sharing economy grows, the
`need for dedicated rental cars, which require expensive overhead and massive
`environmental waste, is diminishing. Turo is the largest and most successful peer-to-
`peer car sharing platform provider in the United States.
`32. On average, California car owners who use Turo earn about $3,500 per
`year, which helps many to offset their car loan and insurance payments. This extra
`source of income benefits Californians who belong to the over 90 percent of American
`households that own one or more cars, including seniors on fixed incomes and young
`people with student loans. Indeed, the majority of car owners using Turo report using
`their earnings to make car payments, reduce debt, or save for their future.
`33. Turo lets these households realize income on an otherwise idle asset while
`reducing environmental impacts by eventually decreasing the number of cars on the
`road. In fact, researchers at the University of California, Berkeley have found that
`“shared mobility” platforms like Turo can create new revenue sources from underused
`resources, support healthy lifestyles by reducing driving, and benefit the environment
`by encouraging individuals to forgo car ownership and instead use public transit
`supplemented by car sharing. Likewise, United States Department of Transportation
`researchers have found that members of car sharing programs are more likely to sell
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`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`their cars and avoid buying new cars. Reductions in car ownership, in turn, correlate
`with increased public transit use, walking, biking, and reduced parking demand.6
`Turo Is an Online Matchmaking Platform
`Not Liable for the Conduct of Its Users
`34. Turo maintains a software platform that matches car owners with those in
`need of a car. This business model is fundamentally different from car rental
`companies, which own vast fleets of vehicles, run private networks of airport vans and
`shuttle buses, utilize significant real estate to conduct their operations, and rake in
`immense profits due to generous tax breaks from the federal and state government
`(including direct subsidies, bail-outs, waiver of capital gains taxes for car purchases and
`sales, and pass-through of registration and licensing fees) in excess of $3 billion per
`year.
`35. Private car owners who use Turo set up a profile and list their cars by
`describing the make, model, location, and special features of the cars, and indicating
`availability. Owners may also input more detailed descriptions of the cars and set
`guidelines for use, including price and terms of delivery. Most car owners also upload
`photographs of their cars.
`36. Users who wish to book a car share also set up profiles on Turo. They can
`search Turo’s website or app by: (a) typing a desired location into the search menu on
`Turo’s main homepage; and (b) inputting a desired timeframe using a drop-down menu.
`These Users then gain access to over 800 makes and models, and—unlike if they were
`renting from a rental car company—they can pick a car with the specific make, model,
`
`
`6 See, e.g., Susan Shaheen & Adam Cohen, Overview of Shared Mobility, ITS
`BERKELEY POLICY BRIEFS, available at https://cloudfront.escholarship.org/dist/prd/
`content/qt8w77044h/qt8w77044h.pdf?t=p2q24m&v=lg (last visited July 11, 2018);
`UNITED STATES DEPARTMENT OF TRANSPORTATION, Shared Mobility: Current
`Practices and Guiding Principles (hereafter, “Shared Mobility”) at ix, available at
`https://ops.fhwa.dot.gov/publications/fhwahop16022/fhwahop16022.pdf (last visited
`July 11, 2018).
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`COOLEY LLP
`ATTORNEYS AT LAW
`SAN FRANCISCO
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`11.
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`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`and color they want. That is, they can pick the exact car that fits the occasion and their
`budget and coordinate directly with its owner for delivery or pickup from a pre-
`determined location.
`37. Turo does not require that owners offer, or guests receive, car delivery.
`Instead, the owner and guest can agree that the guest will pick up the car from the
`location where the owner keeps it (or at any other owner-specified location).
`38.
`If the owner chooses to deliver the car, she can use the Turo platform tools
`to create a completely customized delivery option. That is, the owner can offer to
`deliver the car at any location that she agrees with the guest, or the two can simply agree
`to coordinate with each other (either via Turo’s messaging tools, or via phone, text, or
`email) prior to the exchange.
`39. An owner may also optionally offer delivery to “LAX,” only if she agrees
`with the guest to meet there. Even then, Turo does not dictate where the owner and her
`guest will exchange the car. They can agree to meet anywhere at or near the airport,
`including in a parking lot, at the curb, or at any other customized location.
`40. Because Turo is an online platform, and because Turo does not require or
`mandate LAX exchanges, the Communications Decency Act, 47 U.S.C. § 230 precludes
`liability stemming from such User-organized exchanges.
`The California Legislature Has Recognized That Turo’s Car Sharing
`Model Is Legally Distinct From the Rental Car Company Model
`41. As noted above, Turo is a car sharing platform, without any fleet of cars to
`“rent.” Just as Kayak and Expedia are not airlines, eBay is not an auctioneer, StubHub
`is not a ticket seller, Skype is not a telecom company, and DoorDash is not a restaurant,
`Turo is not a rental car company.
`42. California law is in accord. California Insurance Code § 11580.24,
`enacted in 2010, created a legal framework for personal vehicle sharing programs. The
`California legislature thus recognized that such programs are distinct from rental car
`companies, which are governed by a separate legal framework. Specifically, Insurance
`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`Code § 11580.24 (a) defines a “personal vehicle sharing program” such as Turo as “a
`legal entity qualified to do business in the State of California engaged in the business
`of facilitating the sharing of private passenger vehicles for noncommercial use by
`individuals within the state”; and (b) explains that private cars shared through such
`programs are not commercial vehicles. Moreover, this law requires personal vehicle
`sharing programs like Turo to provide auto insurance that covers vehicles while they
`are being shared, relieving owners of this responsibility. Id. § 11580.24(c)(1).
`43. The National Resources Defense Council, the Environmental Defense
`Fund, the Sierra Club, the City of Sacramento, the American Planning Association,
`California Chapter, Community Action to Prevent Asthma, and the Consumer
`Attorneys of California supported the passage of this law—many of them because of
`the environmental or consumer-choice benefits of car sharing programs like Turo.
`44. Consistent with this provision of California insurance law, other aspects of
`California law also make plain that Turo, an online platform allowing car owners to
`share their personal vehicles with guests, is not a rental car company:7
`(a) The California Vehicle Code defines a “rental car company” as “a
`person or entity in the business of renting passenger vehicles to the public in California.”
`Cal. Veh. Code § 11752(e).
`(b) The California Civil Code defines a “rental company” as “a person
`or entity in the business of renting passenger vehicles to the public.” Cal. Civ. Code
`§ 1939.01(a).
`(c) The California Insurance Code defines a “rental car company” as
`“any person in the business of renting vehicles to the public.” Cal. Ins. Code § 1758.89.
`45. These statutes show that a rental car company rents cars to customers and
`a personal vehicle sharing program is something distinct—i.e., a platform that
`
`7 Turo’s Users are also not rental car companies. They are instead individuals
`empowered by California Insurance Code § 11580.24 to earn income from an otherwise
`idle asset without operating as commercial entities.
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`COOLEY LLP
`ATTORNEYS AT LAW
`SAN FRANCISCO
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`
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`13.
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`COMPLAINT OF TURO INC. FOR DECLARATORY
`JUDGMENT AND OTHER RELIEF; 2:18-CV-6055
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`“facilitat[es] the sharing of private passenger vehicles for noncommercial use.” As
`such, Turo does not meet the statutory definition of a rental car company. Indeed, its
`business model provides consumers with a far more appealing alternative to them.
`46. Other governmental and private actors agree. For example, Oregon and
`Washington passed similar car sharing laws to California’s and Maryland just passed a
`peer-to-peer car sharing statute which makes clear platforms like Turo are not
`considered rental car companies. Similarly, credit card companies and personal
`insurance providers that offer protections to rental car companies’ customers regularly
`deny such coverage to Turo Users because Turo is not a rental car company. And the
`United States Department of Transportation has stated that “peer-to-peer carsharing”
`programs are distinct from rental car companies.8
`The City Cannot Charge Turo the LAX Facilities Charge Under California Law
`47. Consistent with the will of the rental car companies, the City has demanded
`that Turo obtain a rental car company permit and pay the LAX Facil