Arkansas Entrepreneur Breaks Taxi Monopoly
Little Rock, Ark.—Today is a historic day for transportation freedom in Little Rock. Entrepreneur Ken Leininger has opened up the city’s first taxi company in 16 years after a successful year-long legal battle with Little Rock officials. The Little Rock Board of Directors granted Ken’s request for seven new taxi permits yesterday. This morning, Ken paid for his permits from the Little Rock Fleet Services Department and is officially open for business.
“I have been waiting two years to be granted a new taxi permit by Little Rock officials and still cannot believe that day is here,” explained Ken, owner of Ken’s Cab. “I plan to buy four more cars and hire four more drivers right away,” he said.
But Ken’s Little Rock debut almost never happened. When Ken first applied to offer his services in the city, he was told he met all of the legal requirements for a new taxi service except two: He had to prove he would not take customers away from Little Rock’s only existing taxi company and prove that unmet demand made his competition “necessary.” Unwilling to let protectionist regulations keep him out of business, Ken teamed up with the Institute for Justice (IJ)—a nonprofit law firm that has won court victories for transportation entrepreneurs in Denver, Milwaukee, New York City, and other cities nationwide—to file a major constitutional challenge to Little Rock’s taxi law. And he won: On December 7, 2016, Ken and IJ scored a sweeping victory when the Pulaski County Circuit Court ruled that Little Rock’s city code violated the Arkansas Constitution, which prohibits the government from creating a private monopoly.
“Today is a victory for Ken and for taxi customers in Little Rock,” said Justin Pearson, the managing attorney of IJ’s Florida office and lead attorney on Ken’s case. “But it is also a victory for a basic constitutional principle—that government power cannot be used simply to protect favored businesses from competition.”
“Ken’s victory in Little Rock is just the latest example of a wave of transportation freedom that has been sweeping the nation in recent years,” said IJ Senior Attorney Robert McNamara. “As recently as 20 years ago, almost every jurisdiction in the country had rules that made it all but impossible to break into the taxi business. But Little Rock joins cities like San Diego, Minneapolis, Milwaukee, and others that have cast aside outdated, protectionist laws. Increasingly, courts and legislators alike are beginning to recognize that consumers and entrepreneurs, not government officials, should decide which transportation businesses succeed or fail. And the Institute for Justice stands ready to persuade those jurisdictions that have not yet gotten that message.”