In a recent federal court case between Taxi's and the Philadelphia Parking Authority, Judge Michael Baylson sided with the PAA and found for the PAA stating that Taxi drivers cannot blame the PAA for the losses due to the impact of Uber and Lyft on the taxi sector economy.
The reason for the suit is the ever-plunging value of a taxi medallion, which was once worth up to $500,000 is now only worth $10,000. The reason for this devaluation is the impact that rideshare companies Uber and Lyft have on the market. (Similar to the impact digital photography had on the cellulose film industry).
The rationale behind the judge's decision is that while the PAA regulates medallions, it does not regulate their price. The price of a medallion is based solely on the laws of supply and demand, which are market driven. Baylson stated that "A court is not suited to protect market participants from competition, or from changing consumer preferences. The marketplace still speaks loudly, probably louder than a court can, and the resolution of competitive combatants must take place in the marketplace rather than in a courtroom."
The lawsuit was originally filed during 2016 when hundreds of taxi medallion owners came together to sue the PPA for their lack of control over what they termed was Uber and Lyft's legal entry into the local market, causing severe economic damage. The PPA, according to the taxi drivers did not uphold their side of the "contract." The PPA volley that they did all they could to stop the "onslaught" of private drivers for Uber and Lyft from operating but could not handle the deluge that was to become ridesharing.
Towards the end of 2016, the PPA was granted control over the new designated Transportation Network Companies (TNCs) and the PPA CEO Scott Petri supported the decision that would move the PPA into the new era of gig economies, by stating that "The cab owners' position would have wreaked havoc on the industry and seriously hampered the PPA's ability to protect the riding public,"
Petri also looks towards the future, and realizes that TNC's are not just a new fad, they are the future of road transportation and stated "Moving ahead, we look forward to meeting with representatives from the taxi, limo, and TNC industries to make certain that regulations protect the riding public and ensure the safe operation of these entities while recognizing the significant differences between them."
While the taxi cab legal counsel stated that the PPA violated the Constitution's Equal Protection Clause by treating two similar businesses differently and by selectively enforcing cab regulations, Judge Baylson responded by stating that "The taxi companies have offered no legal support for the proposition that a legal participant in a regulated market is 'similarly situated' to an illegal participant in the same regulated market." Baylson also supported the PPA's decisions when handling the emerging technologies by saying "The Pennsylvania legislature enacted substantially new legislation specifically governing TNCs. The legislature therefore clearly considered TNCs to be a new form of for-hire transportation, separate and distinct from taxicabs."