Wednesday, March 2, 2016

Taxi driver sues the city over cab monopoly

Posted By on Wed, Mar 2, 2016 at 4:39 PM

click to enlarge Leininger with one of his cabs.
  • Leininger with one of his cabs.
Ken Leininger, owner of Ken's Cabs, filed suit against the city today, claiming its contract with Yellow Cab violates the Arkansas Constitution's prohibition against monopolies.

Leininger, who City Attorney Tom Carpenter believes has been operating anyway, applied for a permit last year but was turned down because he was unable to show the company would serve as a “public convenience and necessity,” as required by ordinance. He appealed to the city Board of Directors; they did not overturn the denial but recommended he apply again this year, Carpenter said. To Carpenter's knowledge, he has not reapplied. Carpenter said he had not seen the suit.

The city does restrict new tax permits, Carpenter said. Leininger would have had to show that Yellow Cab (Greater Little Rock Taxi Service LLC) was not adequately serving the whole city. 

The suit was filed in Pulaski Circuit Court. Leininger's lawyer is Chris Burks, who is working with the Institute for Justice in Virginia.
 
A full press release is on the jump.

Lawsuit Seeks to End Little Rock’s Taxi Monopoly

Institute for Justice Joins with Entrepreneur to Stop Government-Imposed Taxi Monopoly
Little Rock, Ark.—The Arkansas Constitution says that monopolies are “contrary to the genius of a republic, and shall not be allowed,” but that has not stopped the City of Little Rock from enforcing an ordinance that grants a monopoly to the only taxi company in town. Today, the Institute for Justice has joined a local taxi-driver-turned-entrepreneur in filing a lawsuit that seeks to end the city’s taxi monopoly once and for all.

The City of Little Rock currently prohibits any new cab companies from competing with its one existing company, Greater Little Rock Taxi Service, LLC (“Yellow Cab”), by allowing new taxi permits to be issued only if “public convenience and necessity” leave no other choice and if doing so will not harm the existing permit holder. In other words, a newcomer to the Little Rock taxi market needs to obtain arbitrary approval from the city government and permission from their competitor.

After eight years of working as a driver for Yellow Cab, Ken Leininger decided to start his own business. He founded Ken’s Cab, a taxi company that only uses hybrid vehicles and offers reliable service at competitive fares. Ken believed he could deliver a better service to the people of Little Rock, provide a better deal for drivers, and successfully compete with Yellow Cab. But when Ken tried to get permits for his new business early last year, his applications were repeatedly denied.

Little Rock’s Fleet Services Department admitted that Ken met all of the requirements other than “public convenience and necessity” and approval from Yellow Cab, and therefore denied Ken’s application. Shocked, Ken appealed the decision to Little Rock’s Board of Directors. When the Board heard Ken’s appeal at its meeting in October, Fleet Services again admitted that Ken met all of the other requirements. Some Directors even admitted that Little Rock had created a private monopoly. But when Yellow Cab’s owner asked the Board to reject Ken’s appeal, it did, preserving the monopoly for Yellow Cab.

“Little Rock has only one taxi company, and it is illegal to start a second one,” said Institute for Justice Attorney Justin Pearson, who represents the plaintiffs in the lawsuit. “The government should not be Yellow Cab’s henchman, doing what’s best for Yellow Cab rather than what’s best for the citizens of Little Rock.”

Ken was not going to give up his right to earn a living, especially when he felt that consumers—not the government—should decide whether a new taxi business is “necessary.” So, he teamed up with the Institute for Justice to end the Little Rock taxi monopoly.

“It doesn’t seem right that the government can tell me that I can’t have a taxi service when I know I’ve fulfilled all of the requirements and more,” explained Ken Leininger.

“As Ken’s story shows, monopolies are harmful to small businesses and to customers, which is why the Arkansas Constitution prohibits them,” said IJ Attorney Allison Daniel, who also represents Ken. “Unfortunately, it will take a lawsuit to make Little Rock’s Board of Directors acknowledge that.”

Tags: , ,

From the ArkTimes store

Favorite

Speaking of Ken Leininger, Ken's Cabs

Comments (7)

Showing 1-7 of 7

Add a comment

 
Subscribe to this thread:
Showing 1-7 of 7

Add a comment

More by Leslie Newell Peacock

  • That modern mercantile: The bARn

    The bARn Mercantile — "the general store for the not so general," its slogan says — will open in the space formerly occupied by Ten Thousand Villages at 301A President Clinton Ave.
    • May 26, 2017
  • Meteor will land in LR June 7

    The paper has come down from the long windows facing Kavanaugh Boulevard to reveal The Meteor Cafe, the coffee shop joined to Spokes bicycle shop at the corner of Kavanaugh and Markham, and the cafe has announced a June 7 opening.
    • May 25, 2017
  • A modern mercantile for downtown

    The storefront at the corner of Clinton, Cantrell, Markham and Cumberland (can there be any other intersection anywhere like it?) has brown paper covering the windows and a sign saying LEASED, so we asked Moses Tucker realtor John Martin what gives.
    • May 24, 2017
  • More »

Readers also liked…

  • Jason Rapert vs. Wikipedia

    Sen. Jason Rapert against the world: Wikipedia edition.
    • Jan 23, 2016
  • More on how highways were used to wipe out "blight" of non-white neighborhoods

    Vox, a news website that concerns itself with energy and other issues, has a fine piece, including before and after images, on the history of the U.S. interstate system and why roads were built through the middle of cities (unless people of influence stopped them — see Manhattan, San Francisco and Washington, D.C.)
    • Mar 22, 2016
  • IHOP coming down, but .....

    I always scan the Little Rock City Board for items of interest this week and this one caught my eye: A zoning measure required by a proposal to tear down the IHOP at Markham and University.
    • Apr 30, 2016

Most Shared

  • Conspiracy theorists

    Back in 2000, I interviewed Rev. Jerry Falwell on camera in connection with a documentary film of "The Hunting of the President," which Joe Conason and I wrote.
  • The health of a hospital

    The Medicaid expansion helped Baxter County Regional Medical Center survive and thrive, but a federal repeal bill threatens to imperil it and its patients.
  • Virgil, quick come see

    There goes the Robert E. Lee. But the sentiment that built the monument? It's far from gone.
  • Real reform

    Arkansas voters, once perversely skeptical of complicated ballot issues like constitutional amendments, have become almost comical Pollyannas, ratifying the most shocking laws.
  • That modern mercantile: The bARn

    The bARn Mercantile — "the general store for the not so general," its slogan says — will open in the space formerly occupied by Ten Thousand Villages at 301A President Clinton Ave.

Visit Arkansas

Paddling the Fourche Creek Urban Water Trail

Paddling the Fourche Creek Urban Water Trail

Underutilized waterway is a hidden gem in urban Little Rock

Most Recent Comments

Blogroll

Slideshows

 

© 2017 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation