Circuit Court judge strikes down Little Rock cab monopoly as unconstitutional | Arkansas Blog

Thursday, December 8, 2016

Circuit Court judge strikes down Little Rock cab monopoly as unconstitutional

Posted By on Thu, Dec 8, 2016 at 11:54 AM

click to enlarge LEININGER: His challenge to city's restrictive taxi permit rules won in court.
  • LEININGER: His challenge to city's restrictive taxi permit rules won in court.

Judge David Laser
, sitting in the Pulaski County Circuit Court, yesterday struck down two subsections of Little Rock city law regarding taxi permits. Attorneys for Ken Leininger, owner of Ken's Cabs, who sued the city in March over the law, described it as a "sweeping victory in his constitutional challenge to Little Rock, Arkansas’ longstanding taxi monopoly." The city plans to challenge the ruling.

Leininger applied for a taxi permit in 2015 but was turned down. Under the old law, a permit was withheld if the applicant failed to show that "the requirements of public convenience and necessity" could only be met by issuing an additional permit and that the new permit holder's business wouldn't harm the existing permit holders' business. Despite meeting all other requirements, Leininger was denied a permit because of these provisions. Leininger argued that this amounted to enforcing a monopoly for the city's only taxi company, Greater Little Rock Transportation Services, LLC (Yellow Cab).

Laser agreed yesterday, striking down both of the provisions as a violation of the Arkansas Constitution’s anti-monopoly clause (Article 2, Section 19). Laser issued an injunction against the city enforcing the provisions, and awarded a nominal judgment for Leininger. A written opinion is forthcoming this week.

Leininger can now re-apply for a permit and presumably will be granted one. This will also open up the process to others who want to start a taxi business to compete with Yellow Cab.

I've reached out to City Attorney Tom Carpenter to ask whether the city plans to appeal and will update if I receive a response. If the city appealed, it could try asking for a stay of Laser's judgment to keep the provisions in place while the case was appealed. *** UPDATE: Carpenter said that he will recommend to the City Board of Directors that they fight the decision — either via a motion of reconsideration or an appeal. Carpenter argued that the "necessary and convenient" standard was not unconstitutional, saying that it is currently used to guide regulation of state hospitals and several other businesses. He also pointed out that Leininger had not applied in 2016 or 2017; Carpenter said Leininger likely would have been granted a permit if he had. I'll add more from Carpenter in a subsequent post. ***

Leininger was represented by the Institute for Justice, a libertarian law firm that has previously been active in Arkansas in fighting against what it views as overly burdensome occupational licensing requirements for hair braiders and dentists.

IJ attorney Justin Pearson, who argued the case, said in a statement:

Ken Leinginer just wants to compete. That is all. He is pursuing his version of the American Dream, and today’s ruling confirms that the Arkansas Constitution protects his right to do so.

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