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Taxi-hailing apps are illegal again in NYC, day after launch

May 01, 2013 4:37 pm

Skift Take

Big stakes game of hide-and-seek in the local taxi business in New York City, with huge entrenched players on one side with some legit demands, pushing against brash upstarts with dreams of disrupting.

— Rafat Ali

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New York livery car groups won a bid to block a pilot program that would enable people to hail and pay for rides in one of the city’s 13,000 yellow taxis using location-based smartphone applications.

The measure adopted by the New York City Taxi & Limousine Commission in December would run for 12 months and exempt areas such as airports that have provisions for taxi lines. While all licensed city cab drivers would be eligible, participation would be optional.

The Livery Roundtable, Black Car Assistance Corp. and several car-service firms sued the TLC in February, claiming the program violates city codes and may let drivers discriminate against racial minorities based on their names or locations, as well as the elderly, who are less likely to own smartphones.

New York State Supreme Court Justice Carole Huff in Manhattan last week dismissed the lawsuit and lifted her March 7 order blocking the program. Today, Associate Justice Helen E. Freedman of the Appellate Division, First Department, issued an emergency injunction blocking the program from going forward and ordered expedited review by a full panel of appeals court judges, Randy Mastro, an attorney for the livery cab companies with Gibson Dunn & Crutcher LLP, said in an e-mail.

Mastro, who was deputy mayor under Rudolph Giuliani, said he expects the appeals court to hear arguments on the case this month.

‘Fundamentally Flawed’

“This faux ‘pilot program’ is so fundamentally flawed and illegal in so many respects that it had to be stopped,” Mastro said in an e-mail. “And now it once again has been.”

Freedman issued a temporary restraining order that’s in effect until a full panel of appeals court judges decides the livery car groups’ motion for an injunction during the pendency of their appeal, the city’s Law Department said. That motion is scheduled to be submitted to the appellate panel on May 13, with a decision to be issued on May 20.

“We’re disappointed that there is a further delay in implementing the e-hail pilot program,” Michelle Goldberg-Cahn, senior counsel in the administrative law division of the Law Department, said in a statement. “It’s unfortunate that taxi riders will not be able to continue to test this innovative tool for hailing taxis.”

Limited Range

South of Manhattan’s 59th Street, the smartphone program would be restricted to pickups within a half-mile (0.8 kilometer) range, according to Huff’s decision. Elsewhere in the city, the range would extend to 1 1/2 miles. Smartphone application providers would be subject to Taxi & Limousine Commission approval.

The commission today said it approved Hailo Network USA Inc. as the second participant in the program, joining Uber Technologies Inc.

“The Supreme Court was absolutely right that taxi-hailing apps are not only good for the riding public, but perfectly legal as well,” David Yassky, who heads the commission, said in a statement. “It is appalling that narrow commercial interests continue to try to block passengers from using the latest technology.”

New York Mayor Michael Bloomberg is founder and majority owner of Bloomberg News parent Bloomberg LP.

The case is Black Car Assistance Corp. v. City of New York, 100327-2013, Supreme Court for the State of New York, County of New York (Manhattan).

–Editors: Andrew Dunn, Charles Carter

To contact the reporter on this story: Chris Dolmetsch in New York State Supreme Court at cdolmetsch@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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