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Car2Go settles class-action lawsuit for $1 million

The suit evolved around Car2Go’s imposition of a $1 driver protection fee added to every trip
Car2Go left North America in 2020, citing a lack of electric vehicle infrastructure and “rapidly evolving” competition. (Submitted photo.)

Anyone in B.C., Alberta, Ontario or Quebec who had a Car2Go membership may have some money coming to them — albeit, not much.

A class-action lawsuit against Car2Go was recently settled for $1 million. The suit revolved around Car2Go’s imposition of a so-called driver protection fee, which added an extra dollar to every trip. The action was brought by class members who alleged that the fee breached consumer protection laws around unjust enrichment, effectively making consumers pay for a service they didn’t need.

When the fee was introduced, Car2Go said the fee was necessary to reduce insurance deductibles from $1,000 to $250. The company said it would reduce drivers’ financial exposure if they were involved in an accident or damaged a Car2Go during their trip.

The company was required to pay $1 million, inclusive of all legal fees, taxes and disbursements. To qualify for a settlement, class members need to have paid at least $10 of fees after March 25, 2018, or March 25 2017 for users in Quebec. Settlements will be distributed by accounting firm MNP. Notices will be sent to class members via email instructing them on how to make claims.

The settlement will not require the company to admit fault.

Alexia Majidi is a lawyer with Hammerco, the firm that represented the class members. Majidi said approximately two-thirds of the settlement will remain after the deduction of fees, interest and taxes. Settlements will not exceed the total amount of fees paid during the applicable class period. But Majidi said the suit isn’t about the money.

“It’s about holding corporations accountable and to disgorge or take back what they unlawfully took. There was no basis for the driver protection fee as most credit cards were already offering this to users. And while it is only $1 per trip, this adds up when you consider the number of car2go users in Alberta, Ontario, and BC over June 1, 2015 - February 29, 2020.”

Car2Go merged with the car share service Drive Now, becoming ShareNow before abruptly pulling their service from North America. Share Now said that North American infrastructure could not support a large fleet of shared electric vehicles and cited “rapidly evolving” competition like ride-hailing and rapid transit for their departure.

At the time, more than 450,000 Canadians used the service. The company still operates in multiple European cities.

RELATED: Share Now, formerly Car2Go, leaves Canada with valuable data in changing market: expert

RELATED: Share Now, formerly Car2Go, to halt service in Vancouver, Montreal


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