Claiming that as many as 1,000 medallion owners are facing bankruptcy and foreclosure, individual taxi owners and their allies took to the steps of City Hall on Wednesday in a call for help from government officials. The rally also called attention to a lawsuit filed Monday against the city, the Taxi and Limousine Commission and its commissioner, Meera Joshi. The suit, filed in state Supreme Court in Manhattan, argues that medallions were sold on the premise that they conveyed an exclusive right to pick up passengers on the street. Detailing the disruption that Uber’s entry has wreaked on the market, the suit claims that the medallion owners’ exclusive right has been given away to ride-hail drivers.
It asks that the city and its regulator enforce standards that will make sure all medallion owners remain “financially stable.”
The suit joins others brought against the city by the taxi industry in an effort to block the growth of ride-hail services. All were unsuccessful, but an attorney for the two taxi drivers who filed the suit says this one is different.
“It’s just asking the courts to compel the city and the TLC to abide by their own laws,” said the lawyer, Brad Gerstman, referring to the Taxi and Limousine Commission.
The city has successfully defended itself against previous taxi industry lawsuits by arguing that pickups booked via smartphone apps are prearranged travel, which is not exclusive to yellow cabs. “The city’s taxi industry continues to advance technologically,” said Joshi in a statement. “With such a well-known, global brand—the yellow taxi—there is great opportunity for both longtime and new businesses to use technology to improve customer service.”
The taxi groups are also calling on Gov. Andrew Cuomo to help the industry through regulatory changes, a state-backed distressed assets relief plan and a temporary moratorium on medallion foreclosures. (Medallions sold as recently as 2014 for close to $1 million and sometimes more, so their purchases are commonly financed, as a house would be.) Last week the Taxi Medallion Owner Driver Association sent the governor a letter asking him to intervene.
“We are reviewing the letter and look forward to engaging with members of the taxi association to address issues of interest,” a spokesman for the governor said.
The taxi industry has been under unrelenting pressure as app-based ride-hail services have eaten into the traditional cabbies’ business and undermined the value of the 13,587 taxi medallions issued by the city.
“There is no market for the medallion,” said Gloria Guerra, whose husband, William Guerra, is one of the drivers suing the city. The couple are in their 60s and have health problems, and had long planned to lease out their medallion when they retired. But it was recently chosen through a city lottery to be designated for a wheelchair-accessible cab, which has hurt its value.
Though the taxi industry has embraced the city’s goal of making half of all cabs wheelchair-accessible by 2020, the mandate has become a major point of contention, with both taxi groups and disability advocates arguing that ride-hail vehicles should have the same requirement. Cabs that accommodate wheelchairs are bigger and heavier than conventional taxis and use more gas. That has made them unpopular with drivers and helped to make driving for ride-hail companies more attractive.
“There’s no market for leasing it,” Gloria Guerra said of the couple’s medallion.
Uber declined to comment. The company and its supporters have traditionally said that it has brought innovation to a stagnant industry, increased transportation options in the outer boroughs, and should be judged on whether it is serving riders.
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