New York City Passed a Law Limiting Uber and Lyft Deactivations. A Federal Court Blocked It.
The law. In January 2026, the New York City Council passed Local Law 52 of 2026 over then-Mayor Eric Adams’s veto. It would have allowed Uber and Lyft to deactivate drivers only for specified reasons, and it would have let more than 12,000 drivers deactivated since July 2019 petition for reinstatement. It was set to take effect July 28, 2026.
The lawsuits. Uber sued the city on June 9, 2026, and Lyft followed. The companies argued the law took away their contract rights and violated the Constitution. Court filings say about 87,000 Uber and Lyft drivers completed more than 22 million trips in New York City in March 2026, and that Uber deactivates about 1% of New York driver accounts a year.
The ruling. In July 2026, the companies won an order blocking the law before it took effect. City Council leaders said they would defend it. The case is Uber Technologies, Inc. v. City of New York, No. 1:26-cv-04893 (S.D.N.Y.).
What drivers have now. Uber’s separate deactivation review panel for New York City drivers, run through the American Arbitration Association, still exists. Drivers hurt in an accident and then deactivated should save every notice. Those messages document lost income. See Deactivated by Uber or Lyft After an Accident?
Sources: Bloomberg Law — Uber sues NYC over deactivation law (June 10, 2026) · S.D.N.Y. opinion and order (PDF) · International Employment Lawyer — Platforms block NYC deactivation law (July 23, 2026)
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