IJCE Strikes Blow for Independent Taxi Affiliations

July 1, 2001

July 2001

IJCE Strikes Blow for Independent Taxi Affiliations

By John Stinneford

When the Chicago Department of Consumer Services announced that it wanted taxi companies to start jitney programs to serve Chicago’s inner-city communities, the Jimmy Morgan Taxi Association was the only company to step forward.  James Morgan, Sr., now deceased, had founded the company as a jitney service back in 1934, when the dominant taxi companies refused to go to the south side of the city.  His son Jimmy Morgan, JMTA’s current owner, volunteered for the new jitney program because he wanted to continue his company’s tradition of service to Chicago’s inner-city communities.

Client Jimmy Morgan will remain in business thanks to the IJ Clinic’s advocacy.

Instead of welcoming JMTA’s initiative, however, the city of Chicago has spent the last two years aggressively trying to shut it down.

In the summer of 1999, the Chicago Department of Consumer Services conducted a “sting operation” in which city employees, posing as consumers, called taxi affiliations and timed them to see whether a cab arrived within 30 minutes.  Although none of the affiliations appear to have “passed” this test, the City singled out five small independent African- and African-American-owned companies, including JMTA, and prosecuted them (ironically) for violating a city anti-discrimination ordinance.  The city sought $7,500 in fines against each company—despite the fact that no actual consumers had ever complained about these companies’ radio dispatch service, and the City’s own investigators testified that none of these companies refused them service.

For the past 20 months, working as part of the Institute for Justice Clinic on Entrepreneurship (IJCE), Clinic Director Patricia Lee, James Joseph (my predecessor as the IJCE’s assistant director) and I have defended JMTA and two other small taxi affiliations (ABO and Metro Jet) against these charges.  On June 7, 2001, the Hearing Officer granted our clients and the other affiliations a total victory, dismissing every one of the nearly 50 counts that had been brought against them.  The Hearing Officer found that in every case, our clients had made reasonable efforts to dispatch a cab but were prevented from doing so because they were small, and because the City-imposed licensing scheme made drivers independent of affiliation control.

After hearing of this victory, Jimmy Morgan said, “If it weren’t for the IJ Clinic on Entrepreneurship, the City would have put us out of business long ago.  Now there’s a chance I can pass this business on to my son, as my father passed it on to me.”

Eddie Nwosu of Metro Jet added, “I came to this country from Nigeria for freedom and liberty, but I met with nothing but obstacles from the City.  The IJ Clinic has helped me keep my business.”

James Boateng of ABO did not say anything after hearing the verdict, but his smile and the tears in his eyes spoke volumes.

Unfortunately, however, our clients are not yet out of the woods.  Last December, after our clients refused to admit liability as a condition for settling the case, the Department of Consumer Services brought a duplicative second complaint against JMTA, seeking to revoke its license.  On June 8, the day after our victory, the Department filed new charges against ABO and JMTA based on almost identical allegations.  And finally, the City has passed a new ordinance that appears to be tailored to destroy small affiliations like our clients.

The fight for liberty never ends.  But we at the IJ Clinic on Entrepreneurship will continue to work as hard as we can to ensure that all our clients are afforded that most basic right:  the right to earn an honest living. 

John Stinneford is the assistant director of the IJ Clinic on Entrepreneurship.

Also in this issue

With Big Odds and High Stakes Limo Drivers and IJ Lawyers Roll to Victory

IJ Asks Supreme Court to Review Cleveland Case

Litigation Update

Stanley Dea – Vindicated At Last

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