NEWS 8 INVESTIGATES
DALLAS If it makes you mad when you pay for something but never get it, then you know how cab driver Rahabar Hossain feels about Yellow Cab.
Hossain is a subcontractor who owns his own cab and drives it for Yellow.
Every month, he says, he pays Yellow for insurance coverage. In 2012, Hossain got in an accident with another vehicle and needed that insurance.
He said when he told the company about the incident, he was told they would handle it.
'The Yellow company, Yellow Cab,' Hossain said. 'Because I'm driving the Yellow company's taxi. And I have Yellow Cab's insurance. And I pay for that.
But Yellow did not take care of it.
And soon the other driver's insurance company hit Hossain with a lawsuit for $7,300 in damages. Hossain said he reported the lawsuit to a supervisor at Yellow.
'She said, 'Don't worry about that. Go home and get relaxed; our lawyer will take care of that,'' Hossain said he was told.
But records show Yellow never defended Hossain, and now he's suing Yellow Cab for deception and fraud.
An attorney for Yellow said the company cannot verify Hossain ever notified Yellow about the lawsuit; that his case is an anomaly; and that it does right by its drivers.
In Dallas, cab companies are required to carry $500,000 worth of insurance. Every dollar of an injury claim must be paid through an insurance policy, not the cab company. Self-insurance is not allowed.
That policy is supposed to eliminate the temptation for a cab company to save its cash by denying legitimate injury claims.
But News 8 has previously reported that Yellow did self-insure cabs for at least ten years, a violation of the rules.
A letter from the city attorney's office points out there are 1,500 cabs out there owned by Yellow's drivers, and by definition, Yellow could not self-insure something if never owned.
The letter says 1,500 Yellow drivers who work as subcontractors, were 'completely uninsured,' 'leaving victims of accidents ... with little recourse but to attempt to recover for their injuries from the uninsured cab driver.'
So cab drivers the little guys, like Hossain say they kept paying and paying Yellow for insurance coverage they never got.
'It's a ripoff,' said Kelly Hollingsworth, Hossain's attorney.
After a City Council meeting on Tuesday, we asked Jack Bewley, president of Yellow, what the drivers were actually paying for.
He did not answer our questions.
Hollingsworth alleges that Yellow ran its own unregulated insurance company for 12 years.
'They get 'em coming and going,' he said.
Yellow sold insurance to cabbies that the city said never even existed. Yellow even listed parent company 'Irving Holdings' as the insurance company on the proof of insurance cards it gave to cabbies.
Yellow collected premiums and deductibles.
And the company handled and frequently rejected claims from injured passengers.
Linda Dedman, a Dallas attorney who is not involved in this case, is an expert on complex insurance issues. She agrees that Yellow Cab acted like an unlicensed insurance company.
'They collected a premium; they sold insurance coverage; and they administered claims,' she said. 'All of those are activities that constitute the definition of engaging in the business of insurance in Texas. All of those would require some sort of licensure.'
But Yellow is not licensed as an insurance company with the State of Texas, as all legitimate insurance companies must be.
The City of Dallas says it is powerless to address the business practices of Yellow Cab, though it could refer the case to the district attorney
So there's no one out there to protect drivers and passengers.
And Rahabar Hossain says it's the little guy left picking up the bill.