Technology has created a boon industry for alternative car services in the city of Chicago, but traditional taxis are gearing up to put a stop to it.
A group of taxi owners, drivers and the Illinois Taxi Transportation Alliance filed a lawsuit Thursday that they say is the first ever filed in the country against a city for "failing to enforce its own regulations for taxi services."
- VIEW: Cab Driver Lawsuit
The suit claims companies such as UberX, Lyft and Sidecar are jeopardizing public health and safety and exposing the city to more than $1 billion in potential lawsuits.
The suit also alleges the city allows these companies to discriminate against passengers in low-income neighborhoods and individuals with disabilities.
"Uber says, 'Gee, I'm sorry, we don't offer that,'" said Brad Saul, the president of Chicago Disability Transit.
"That's essentially saying we're playing with two sets of rules," attorney Michael Shakman said. "This is an administration that understands public policy and has to realize that what it's doing is poor public policy."
Private drivers are cutting into the profits of those who paid $360,000 for a city medallion. The medallions are no longer valued that highly.
"The money I gained from the taxi business has declined substantially," cab driver Francis Koblah said.
Uber Chicago general manager Andrew McDonald defended his company, calling it a "faster, cheaper and safer way of getting around."
Mayor Rahm Emanuel supports a proposed ordinance he believes closes a loophole that has given ride-sharing companies an unfair advantage, but cab companies say the measure lets the ride-sharing companies off lightly.
It would require them to pay a $25,000 annual fee, a daily $3.50-per-vehicle ground transportation tax and a $25-per-driver tax that companies pay. The cab companies argue the payment from those fees and taxes would be small compared with the $24 million paid annually by the taxi industry.
Emanuel's ordinance would require licensed ride-sharing companies to train and administer drug tests to their drivers, conduct criminal background checks and make certain vehicles pass an annual inspection. Passengers also will be allowed to negotiate the fare.
But aldermen Anthony Beale and Ed Burke want the private companies to stop operating until new rules are in place.
"Now we have these new companies coming in, there's no rules or regulations, nobody's checking what they're doing or how they're doing it, and they're making millions of dollars," Beale said.
The city's attorney says he hopes to have the new lawsuit dismissed, believing changes should be made through the legislative process and not the courts.
