(Bloomberg) — Uber Technologies Inc. car-sharing servicecompetitor Lyft Inc., which said it planned to begin operationstoday in New York City, was sued by New York officials who claimit's flouting licensing laws.

New York Attorney General Eric Schneiderman and Superintendentof Financial Services Benjamin Lawsky sought a temporaryrestraining order against the company, arguing in a complaint filedtoday in Manhattan state court that Lyft hasn't complied with stateand local regulations.

“As it has done in every other city in which it operates,defendant has simply waltzed into New York and set up shop whiledefying every law passed whose very purpose is to protect thepeople of the state of New York,” Schneiderman's office said in thecomplaint.

Lyft, based in San Francisco, said on July 9 that it would startoffering mobile-booking ride-sharing services by today in New Yorkwith 500 drivers, bringing more competition to Uber, which wasvalued at $17 billion in its latest financing round. Lyft startedoperating in two other New York cities, Buffalo and Rochester, onApril 24, without approval or authorization, according to thecomplaint.

“We always seek to work collaboratively with leaders in theinterests of public safety and the community, as we have donesuccessfully in cities and states across the country, and hope tofind a path forward for ride-sharing in New York,” Erin Simpson, aspokeswoman for Lyft, wrote in an e-mailed statement.

Insurance Claims

Lyft today asked a judge to block the state's subpoena againstthe company, arguing the operational documents requested by thestate are “utterly irrelevant” to the dispute, court recordsshow.

Lyft doesn't require drivers to hold commercial licenses,conduct vehicle safety inspections or take defensive-drivingcourses, the state officials claimed. The company also doesn'tconduct drug tests on drivers, the officials said.

The New York State Department of Financial Services on July 8issued a cease and desist letter, saying the company is violatingstate laws, including selling insurance directly to New Yorkdrivers and requiring them to buy from a specific insurer in orderto join Lyft's program. Lawsky had said in the letter that DFS iswilling to work with Lyft to determine how the company can operatelegally in the state.

The New York City Taxi & Limousine Commission also weighedin, saying on July 9 that Lyft hasn't complied with safetyrequirements and licensing criteria. At the time, Lyft said itwould start the service anyway.

Uber Pricing

Uber, which has been operating in the city since 2011, has alsoencountered legal hurdles in its New York operations with regard tothe fee it charges customers. The San Francisco-based companyreached an agreement with Schneiderman's office to limit itspeak-pricing tactics and cap fees during emergencies, potentiallyrestricting revenue.

Unlike traditional taxis with fixed fares, Uber varies itstariffs depending on demand. Uber agreed with the attorneygeneral's office earlier this week to limit pricing during“abnormal disruptions of the market” under an accord. The companysometimes charged as much as eight times its base rate duringstorms, Schneiderman said.

While UberX, its lower-priced service, is a ride-sharingoffering that competes directly with Lyft in other cities, UberXdrivers in New York have official taxi licenses and operate morelike a taxi service.

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