MILWAUKEE (CN) – Having failed to land an injunction, Milwaukee cabbies now want reimbursement of the $24.3 million they claim that a new law has cost them.
Joe Sanfelippo Cabs is the lead plaintiff in the action originally filed this past August, challenging changes Milwaukee made to its public passenger vehicle rules.
Though the cabbies had initially sought to have the city stop giving app-based companies like Uber and Lyft preferential treatment, they abandoned that claim in an amended complaint filed Thursday after U.S. District Judge Lynn Adelman denied them a temporary injunction.
The dispute stems from a 2011 challenge by different cabbies to a cap on the number with a taxi permits in the city since 1992.
When a judge agreed that the 354-permit cap could not stand, Milwaukee cut off an appeal by passing an ordinance that allowed 100 more taxi permits to be issued by Nov. 1, 2014.
With the recent market entry of app-based ridesharing services, the city again changed its ordinances to allow the issuance of unlimited taxi permits.
Joe Sanfelippo and the other traditional cabbies say the new rule devalued the permits they had obtained in the days of the cap to sell on the secondary market.
The plaintiffs allegedly purchased 162 permits, paying as much as $142,857.14 each, for a total value of $24.3 million, according to the amended complaint.
“Elimination of the taxicab permit cap has completely destroyed any and all economic value in taxicab permits, causing their value to plummet from approximately $150,000 to zero,” the amended complaint states.
The cabbies call Milwaukee’s removal of the cap a violation of the Fifth Amendment.
“The city’s actions amending its ordinance in 2014 constitute a taking plaintiff’s property rights in the value of their taxicab permits without just compensation,” the amended complaint states.
Milwaukee also breached its contract with taxi permit holders by reneging on the promise made in the 1992 ordinance not to issue any more permits, according to the amended complaint.
Plaintiffs seek damages in the amount of the difference between the value of their taxi permits before Sept. 1 and after.
Dean Laing, an attorney for the plaintiffs with O’Neil, Cannon, Hollman, DeJong & Laing, did not return a request for comment.
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