Appeals court sides with city in ongoing CPNC dispute but sympathetic to cab drivers

26th December 2012   ·   0 Comments

On December 18, a panel of Fifth Circuit Court of Appeals judges ruled in the City of New Orleans’ favor on three consolidated lawsuits filed by taxicab companies and CPNC holders regarding the lawfulness of the city’s taxicab reform package.

However the three-judge panel did not rule out the possibility that the taxicab drivers may have another chance to make their case in the legal system.

“Today’s ruling and the reforms that it upheld is consistent with common sense and the practical needs of the city, the taxi industry and its customers, and we will continue our efforts to create a world class taxicab industry in New Orleans,” Mayor Landrieu said. “This is a win for the residents, businesses and visitors of New Orleans, who deserve clean, reliable, and accessible taxicab service. “

The court held that a Certificate of Public Convenience and Necessity (CPNC) is a privilege and not a right.

“Today is an exciting day for the future of transportation in New Orleans. For years our residents and visitors have asked for improvements in the for-hire industry, but weak legal arguments were perceived as road blocks to achieving better standards,” said District C Council­member Kristin Gisleson Palmer. “Today’s U.S. Fifth Circuit Court decision will further the reforms that the administration and the City Council have made in setting higher standards in the for-hire industry. Everyone will benefit from riders being better served and therefore satisfied customers. “

Attorneys for the city’s nearly 1,500 cab drivers have said that their clients were not allowed to contribute in any way to efforts to come up with reasonable reforms before the City Council voted earlier this year. Nor were they granted a workable time frame within which to make the city-mandated upgrades and changes. Complicating the process was a catch-22 situation in which in the past taxicab drivers were able to use their CPNCs as collateral in order to secure bank loans to make the necessary changes to their cabs.

In April of 2012, the City Council passed sweeping taxicab reforms recommended by the Landrieu Administration and Councilmember Kristin Gisleson Palmer. The reforms have already improved vehicle standards, improved driver and CPNC holder standards, and improved industry and permitting regulations.

Taxicab drivers have pointed out that the city and state have conducted business for more than a half-century that the government-regulated CPNCs were properties that could be passed down from one generation to the next, sold or purchased by cab drivers. Those practices appear to support the premise that CPNCs can and should be protected as items of value, not privileges controlled by a city agency, attorneys for the taxicab drivers contend.

To date, more than 950 taxicabs have reportedly come into compliance. It is expected that most taxicabs will be in compliance by the 2013 Super Bowl.

The reform package includes improvements for passengers, drivers and CPNC holders.

The city said last week that by early 2013, passengers can expect: Cabs with common-sense vehicle age limits and a prohibition on salvaged and junked vehicles; the ability to pay fares with credit or debit card; taximeter receipts with detailed information; cabs equip­ped with GPS technology; tougher inspections and vehicle safety standards; improved safety re­quirements including one seatbelt per passenger; tougher ethical standards for taxis and the Taxicab and For Hire Bureau; and; the creation of a dedicated fleet of handicap-accessible cabs.

The three-judge panel said that it was not presenting a final ruling on the merits of all the taxicab drivers’ challenges, only on whether they were entitled to an injunction blocking the city from enforcing the new rules. According to the local daily paper, the panel said the taxicab drivers had failed to show they were entitled to such an injunction either on the upgrade ordinances or on the legal status of CPNCs.

The daily paper reported that the panel indicated it was sympathetic to cab owners’ argument that city has not shown a “rational basis” for the new rules on the maximum age of cabs. However, it added that if the owners ultimately can persuade a court that that rule—or the other laws requiring installation of expensive new equipment—is not justified, the owners could file a lawsuit against the city to recover the money they would have been erroneously required to spend as part of the taxicab reforms.

This article was originally published in the December 24, 2012 print edition of The Louisiana Weekly newspaper