Livery Cab Street Hail Plan Faces Court Challenge

The city’s plan to roll out a new class of taxi to serve neighborhoods in Brooklyn, northern Manhattan and other areas poorly served by yellow cabs, is now heading to court, courtesy of a lawsuit filed by a lobbying group representing the largest yellow medallion taxi fleets.

The lawsuit, filed yesterday in New York State Supreme Court by the Metropolitan Taxicab Board of Trade, claims that the outerborough street hail livery plan, passed into law by Albany legislators in Feburary, violates the rights of medallion owners who paid for exclusive rights to pick up street hails in New York City.

The proposal would create a new class of taxi medallion for up to 18,000 livery drivers, giving them the right to pick up street hails in the Bronx, Brooklyn, Queens, Staten Island and northern Manhattan – areas previously underserved by yellow cabs that clog the city’s financial and tourist areas. It also permits the city to issue 2,000 new yellow taxi medallions.

The privileges for livery cabs will unfairly reward a culture of bad behavior from livery cabbies who “poach” street hails from yellow cabs, the Metropolitan Taxicab Board of Trade claims, and will hurt the livelihood of yellow cab owners who will now have to compete with the new livery class as well as 2,000 new yellow cabs.

“The street hail livery rules are unconstitutional, irresponsible and unconscionable,” said Ron Sherman, president of the Metropolitan Taxicab Board of Trade. “How can the City of New York sell medallions to thousands of individual owner-drivers and small businesses, promising them the exclusive right to pick up street hails, only to take that right away in one destructive piece of legislation?”

The group is also claiming that the process in which the legislation was enacted was unconstitutional, violating a “Home Rule” procedure, in which legislation affecting only one locality can only be passed in the state legislature once the local legislative body has given its stamp of approval. There was no City Council vote on the issuance of new medallions, and no public hearing.

“How can the City do this without a single public hearing, without the authorization of the City Council, and without a single economic study on its effects on this industry comprised mostly of immigrants who have pursued the American dream by working hard, saving their earnings and playing by the rules?” Sherman asked.

What do you think? Is this legislation that will hurt the business of yellow cab drivers? Or will the bill provide service for areas where the yellow cabs were not serving anyway?