Chicago, Illinois — Next week, all eyes will be on Chicago, where a federal appeals court will hear two cases that could dramatically change how cities approach deregulating their transportation markets.
The question before the court is straightforward: Are protected cab companies entitled to be shielded from competition from other businesses? That is the central issue in two lawsuits, one in Chicago and one in Milwaukee. In both cases, entrepreneurs have teamed up with the Institute for Justice (IJ) to fight for their right to compete with formerly protected cab companies. Both cases will be heard by the 7th Circuit Court of Appeals on Monday (9/19) at 9:30 a.m.
In Chicago, IJ and a group of ridesharing drivers are fighting to defend the city’s decision to recognize ridesharing services like Uber and Lyft. This decision was challenged by the entrenched taxicab industry, which argued that cabs should not have to compete with ridesharing companies. A trial court dismissed that lawsuit, and the case is now at the 7th Circuit on appeal.
In Milwaukee, a coalition of taxi drivers, and would-be taxi owners sued the city to have its cap on taxi permits declared unconstitutional back in 2011. At the time, Milwaukee allowed only 321 taxicabs—almost half of them owned by a single person—on its streets. The drivers won, but the taxi industry filed its own lawsuit in response, bizarrely arguing that allowing more competition is itself unconstitutional.
The 7th Circuit will have the chance to uphold the right to honest competition in both cases.