The emergence of businesses such as Uber and Lyft has “threatened the viability of traditional taxicab companies worldwide,” a federal appeals court said this week.
But that doesn’t mean cab companies in Miami-Dade County should receive compensation after a 2016 ordinance cleared the way for Uber and Lyft drivers to hit the streets.
A panel of the 11th U.S. Circuit Court of Appeals on Monday rejected a class-action lawsuit filed by cab companies that contended the Miami-Dade ordinance amounted to an unconstitutional taking of property because of its effect on “medallions,” which have long served as a valuable license for cabs to operate.
The limited number of medallions, which have been issued over the years by the county, traded for about $340,000 by 2014. But the 2016 ordinance did not require app-based services such as Uber and Lyft to obtain medallions, which also were tied to regulations imposed on cab companies.
The lawsuit against the county, in part, alleged that the cab companies should receive compensation because the ordinance allowing competitors such as Uber and Lyft reduced the value of the medallions.
But a federal district judge rejected the arguments, and the panel of the Atlanta-based appeals court agreed in a 32-page ruling Monday. The appeals court said the medallions did not give cab companies a right to “exclusivity” in the local transportation market.
“If the (ordinance) code did not convey to the medallion holders the right to block competition in the for-hire transportation market, then the county could not have ‘taken’ that right and the medallion holders’ takings claims must fail,” said Monday’s ruling, written by Judge Stanley Marcus and joined by judges Charles Wilson and Marcia Morales Howard. “Even the most cursory examination of the code reveals that the county did not give the medallion holders the right to enjoin competition. None of the code’s provisions ever explicitly or implicitly conferred that right. Instead, the code reflects the carefully cabined scope of the medallion holders’ intangible property interest. Moreover, the right to property does not ordinarily encompass the power to exclude competition, and nothing in the code signaled a contrary intent.”
The lawsuit is part of legal and political battles that have played out across the country in recent years as companies such as
Uber and Lyft have upended the traditional taxi industry. Numerous communities in Florida, including Miami-Dade County, grappled with how --- and whether --- to regulate the new companies.
After Miami-Dade County passed its ordinance, the Legislature in 2017 approved a law that created a statewide regulatory framework for the new companies. That state law trumped local ordinances, but the federal appeals court said the Miami-Dade cab companies were still able to pursue the class-action lawsuit against the county because of the 2016 ordinance.
But the appeals court said the county had a rational basis for the ordinance, including differences in regulation between taxis and the new transportation services, which the court called “transportation network entities,” or “TNEs.”
“The long and short of it is that the medallion holders’ constitutional claims fail,” the ruling said. “Their takings claims falter because they cannot lay claim to a property interest that includes the power to block competitors from the for-hire transportation market. And their equal protection claims fail because any disparate regulatory treatment that the county afforded taxicabs and TNEs was amply supported by legitimate government interests.”