Cab companies sue city

Several taxi cab companies filed a lawsuit in federal court against the City of Milwaukee this week in an attempt to block a new ordinance passed by the Common Council in July to eliminate the city’s cap on taxi cab permits and establish regulations for ride sharing services.

 

The move is intended to enable drivers for tech-based ride sharing services, like Uber and Lyft, to obtain permits to operate legally in the city. The legislation passed by aldermen included requirements for driver background checks and vehicle inspections, regulations that the ride sharing services opposed.

Taxi cab companies upset that the cap on the number of taxi permits in the city, currently at 420, would be lifted.

“Having previously limited the number of taxicab permits and required taxicab owners to go to a secondary market and spend thousands of dollars (sometimes tens or hundreds of thousands of dollars) to obtain a city permit, the city now has irrationally destroyed all value of those permits,” the lawsuit states.

The lawsuit was filed by Joe Sanfelippo Cabs Inc., G.C.C. Inc., Roy WMS Inc., Frenchy’s Cab Company Inc. and 2 Sweets LLC. It was filed in U.S. District Court in the Eastern District of Wisconsin in Milwaukee. The case will be heard by Judge Lynn Adelman.

The cab companies also say the city’s new ordinance, “creates an irrational, two-tiered regulatory system that unconstitutionally harms the economic property interests of taxicab permits holders.”

“The ordinance… allows ‘network’ based service providers to operate in an essentially free market system with little or no oversight, while continuing to subject traditional taxicab drivers to antiquated, economically oppressive regulations,” the lawsuit states. “In particular, the Milwaukee ordinance allows ‘network’ based drivers to use practically any vehicle and charge any fare while requiring taxicab drivers to use specific vehicles, charge city-set rates, and incur multiple city-mandated expenses.”

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