Fox Litigators Win Green Light for Taxi Companies in Civil Rights Suit Over Uber and Lyft

June 8, 2017 – Press Releases

In a major legal victory for taxi drivers in Philadelphia, a federal judge ruled that a civil rights suit filed by traditional medallion taxi businesses may proceed with claims they suffered economic harm due to the government’s refusal to regulate Uber and Lyft, the smart phone-based transportation network companies, or TNCs.

Fox Rothschild LLP partner Brett A. Berman, who represented lead plaintiff Checker Cab, said: “This is a landmark decision and a huge win for taxi medallion owners and operators who watched the value of their medallions plummet from about $550,000 to well below $100,000 as the Philadelphia Parking Authority (PPA) did absolutely nothing to regulate Uber and Lyft while continuing to subject taxi drivers and operators to extremely strict regulations.”

In a 15-page decision issued on June 6, 2017, U.S. District Judge Michael M. Baylson rejected PPA’s arguments that all claims in the case should be dismissed.

The judge concluded that the taxi operators have two valid legal theories to pursue against PPA:

  • An Equal Protection claim based on PPA’s policy of strictly enforcing regulations on taxis while refusing to regulate the TNCs in any way.
  • An unlawful taking claim under the U.S. Constitution premised on the loss of value of their medallions.

“Plaintiffs’ allegations of arbitrary disparate treatment, coupled with Plaintiffs’ detailed allegations that taxis and TNCs are similarly situated, are sufficient to state a plausible Equal Protection Claim,” Judge Baylson wrote.

Similarly, Judge Baylson found that since the number of taxi medallions in Philadelphia is capped, Pennsylvania law effectively grants taxi operators an exclusive right. As a result, the judge found, the taxi operators have a valid property interest based on that exclusive right and therefore should be allowed to pursue a takings claim for the medallions’ loss in value.

“Plaintiffs have identified enough of a difference in the statutory structure in Philadelphia to give rise to a plausible allegation that the taxi owners had a property right in their medallions,” Judge Baylson wrote.