MANHATTAN — The city's largest group of taxi owners filed a lawsuit Wednesday to halt the so-called “five borough taxi plan,” which will allow livery cabs to accept hails on the street.
The suit, filed in Manhattan Supreme Court, accuses the city of breaking its contract with yellow cab medallion owners who claim they paid for the “legally protected,” “exclusive right” to pick up passengers on the street.
"How can the City of New York sell medallions to thousands of individual owner-drivers and small businesses, promising them the exclusive right to pick up street hails, only to take that right away in one destructive piece of legislation?” Metropolitan Taxicab Board of Trade President Ron Sherman asked in a statement.
The organization, which filed the suit, argued that there are several provisions in city code that grant the exclusive right to street hails to medallion owners.
The suit also argues that the state lacked the jurisdiction to impose the change because it had not received approval from the City Council, which is required when legislation applies to one locale.
The move comes one day before the Taxi and Limousine Commission is set to vote to implement the legislation, which Mayor Michael Bloomberg first proposed in his State of the City speech as a way to increase access to cabs outside of central and Lower Manhattan.
Under the final deal, which Gov. Andrew Cuomo brokered late last year, up to 18,000 livery drivers will be allowed to purchase $1,500 licenses, allowing them to pick up street hails in the outer boroughs as well as north of East 96th Street on the East Side and West 110th Street on the west.
The legislation also put another 2,000 yellow medallions up for sale — seven times as many as as any previous year, the group said.
As a result, the owners fear their expensive medallions will decrease in value.
But the City's Law Department said the plan is sound.
"A great deal of careful thought and consideration went into the adoption of this important new transportation initiative. We are confident that it complies with all legal requirements — and that this challenge will be rejected by the court," city lawyer Ave Maria Brennan said, adding that the suit comes as “absolutely no surprise" and will not stand in the way the TLC vote.
The TLC meeting is scheduled for Thursday morning at 9 a.m.