Minneapolis Taxis

Minneapolis Taxi Owners Coalition, Inc. v. City of Minneapolis
Defending Minneapolis’ Free-Market Taxi Reforms

IJ Client Luis Paucar

Private companies cannot use government power to outlaw competition, yet this is precisely what the established taxi cartel in Minneapolis tried to do.
In October 2006, the city removed an artificial government-imposed cap on the number of taxis legally permitted to operate within city limits. The new ordinance increased the number of taxicabs on the street each year until 2010, when the cap will be lifted entirely, opening the door to all taxi businesses that are fit, willing and able to serve the public.

Predictably, the city’s taxi cartel sued to keep out newcomers by attempting to maintain its stranglehold on the industry. The cartel’s action was the last gasp of a dinosaur that free-market reforms have made extinct.
The cartel’s baseless lawsuit threatened the civil rights of entrepreneurs like taxicab owner Luis Paucar. Simply put, Luis has the right to earn an honest living in the occupation of his choice free from government-enforced barriers to entry erected to protect existing companies.  That is why on May 1, 2007, the Institute for Justice Minnesota Chapter (IJ-MN) filed legal papers to intervene in the suit brought by the taxi cartel in order to defend the free-market reforms on behalf of Luis Paucar and his new company.  
The judge allowed IJ to intervene and in December 2007, Federal District Court Judge James Rosenbaum ruled in favor of Paucar and adopted the recommendation of Federal Magistrate Franklin Noel that all five counts of the Taxi Coalition’s complaint should be dismissed.
The Taxi Coalition then appealed the case to the U.S. Court of Appeals for the 8th Circuit.  After argument, in July 2009, a unanimous panel of the 8th Circuit upheld the constitutionality of Minneapolis’ deregulation of the local taxi industry and rejected entirely the cartel’s absurd takings claim.  The court’s opinion reflected fully IJ’s argument that municipalities may not be held hostage by the threat of a takings claim for the premium that entrenched interests pay, in secondary markets, for licenses that are restricted in number and then deregulated.

Essential Background


Background on this case

Client Photo

Latest Release: U.S. Supreme Court Rejects Challenge To Minneapolis Taxi Entrepreneur’s Right to Compete (February 22, 2010)

Client Video - none available

Launch Release: IJ Defends Free Market Taxi Reforms (May 1, 2007)

Legal Briefs and Decisions

Decision: Rehearing Petition Denied (August 17, 2009)
Opinion (July 14, 2009)

Appelle Brief (Apr. 18, 2008)

Taxi Industry's Appeal (January 16, 2008)

District Court Judge's order (December 19, 2007)

Magistrate Judge report on Motion to Dismiss (October 29, 2007)


Complete Case Timeline

Case Timeline

Filed Lawsuit:


May 1, 2007: IJ files to intervene

Court Filed:


U.S. District Court for the District of Minnesota





Additional Releases

Maps, Charts and Facts

Release: Eighth Circuit Court of Appeals Protects Minneapolis Taxi Entrepreneur’s Right to Compete (July 14, 2009)

Release: Victory for Minneapolis Taxi Entrepreneurs (December 19, 2007) 

Statewide Study On Government Barriers to Entrepreneurship in Minnesota

Release: Victory for Minneapolis Taxi Entrepreneurs; Judge Upholds Competition in Taxi Market by Dismissing Cartel Lawsuit (October 29, 2007)





Op-eds, News Articles and Links

Article: Minneapolis Taxi Entrepreneur Wins Appeal; Liberty & Law (August 2009)

Article: Victory For Minneapolis Taxi Entrepreneurs; Liberty & Law (December 2007)

Article: Minnesota: Land of 9,998 Regulations, Liberty & Law (December 2006)

Email Address
Please enter a valid email address

Institute for Justice
901 N. Glebe Road, Suite 900
Arlington, VA 22203
Tel 703.682.9320, Fax 703.682.9321
© 1997-2015