Boston-area cab companies take ride-app giant Uber to federal court

Printed from: http://newbostonpost.com/2016/12/16/boston-area-cab-companies-taking-ride-app-giant-uber-to-federal-court/

 

BOSTON — More than 30 taxicab companies filed a lawsuit against the popular ride-hailing app Uber in federal court on Friday, alleging that the company operates in violation of the U.S. Constitution’s Equal Protections Clause and “preys parasitically on established taxi services without paying for them and without obeying the laws designed to protect taxi passengers.”

The lawsuit, filed by cab companies based out of Boston, Everett, Malden, Medford and Somerville, seeks $60 million in damages and also takes aim at a law passed by the state Legislature regulating “transportation network companies” such as Uber and its rival Lyft. 

Lyft, however, is not named in the lawsuit. A message left with attorneys at Cesari and McKenna, LLP, representing the cab companies, was not immediately returned.

A spokesperson for Uber declined to comment.

“Uber owns no cars, no medallions, no licences and no radio associations,” the lawsuit states. “It induces its drivers or ‘partners’ to illegally substitute Uber’s computerized dispatching system for the legal dispatching system in each respective municipality.

“In doing so, Uber knowingly induces its drivers to violate the taxi rules.”

Gov. Charlie Baker signed the state’s ride-hailing bill into law on Aug. 5. In addition to introducing a double-tiered background check process to screen potential drivers, the legislation also tacked on new fees. Transportation network companies like Uber and Lyft are charged 20 center per ride, with 10 cents earmarked to flow back to the municipality where passengers are picked up, five cents designated for the state Department of Transportation and five cents to MassDevelopment. The portion dedicated to MassDevelopment, the state’s economic development agency, goes towards grants aimed at assisting the taxicab industry.

The cab companies are looking to have the recently-passed law struck down as unconstitutional.

Billy Pittman, Baker’s press secretary, said Friday in a statement that the governor, “in collaboration with the legislature, was pleased to sign legislation establishing a regulatory framework for transportation network companies, that didn’t previously exist and prioritizes public safety including some of the strongest ride-for-hire background check systems in the nation.”

Baker’s administration did not comment on the pending litigation. 

The lawsuit’s Equal Protections Clause argument could prove however to be an unwinnable claim, based upon a ruling made in October in Chicago by Judge Richard Posner of the U.S. 7th Court of Appeals.

Posner compared the difference between Uber and taxicabs to the difference between cats and dogs.

“Here’s an analogy: Most cities and towns require dogs but not cats to be licensed…there are differences between the animals,” Posner wrote. “Dog owners, other than those who own cats as well, would like cats to have to be licensed, but do not argue that the failure of government to require that the ‘competing’ animal be licensed deprives the dog owners of a constitutionally protected property right, or alternatively that it subjects them to unconstitutional discrimination.

“The plaintiffs in the present case have no stronger argument for requiring that Uber and the other TNPs (transportation network companies) be subjected to the same licensure scheme as the taxi owners. Just as some people prefer cats to dogs, some people prefer Uber to Yellow Cab, Flash Cab, Checker Cab, et al. They prefer one business model to another.”

Posner in his ruling instructed a lower court judge to toss out the lawsuit.

Read a copy of the lawsuit:

2016-12-16 Cabs v Uber by Evan on Scribd

Read a copy of Judge Posner’s ruling:

2016-10-07 Posner UBER Ruling by Evan on Scribd