Court Gives NYC Van Drivers Economic Liberty Victory

John Kramer
John Kramer · March 23, 1999

Washington, D.C.-The Institute for Justice announced today that New York commuter van operators won a significant victory for economic liberty in the New York State Supreme Court-the state’s trial court. The Court ruled last week that the City Council may not veto van operator licenses approved by the New York City Taxi and Limousine Commission. The Institute had filed suit on February 11, 1997, challenging that provision.

Justice Louis B. York further ruled in favor of van operators when he struck down two sections of the local law: one that automatically denies van applications that are not granted within 180 days, and another allowing regulators to deny licenses without stating a reason.

“No longer can the City Council unilaterally defeat the aspirations of honest entrepreneurs trying to provide efficient community-based transportation,” said Chip Mellor, president of the Institute for Justice, which represents the van operators. “This decision profoundly changes the rules of the game governing commuter vans. More vans should now be authorized to serve the riding public.”

Jamaican immigrant Hector Ricketts is among four plaintiffs suing the State and City of New York. Ricketts wants to provide safe and reliable van transportation for his community of Queens, New York, but is prevented from doing so by arbitrary and onerous regulations designed to protect the local public bus monopoly. Since 1994, 98 percent of all the vans that have sought licenses from the City Council have been denied.

While last week’s victories were significant, much of the lawsuit continues. New York’s laws still impose arbitrary and unreasonable burdens on commuter vans that prevent them from reaching their full potential in New York’s transportation network. For instance, vans are prohibited from picking up or discharging passengers on any street where public buses operate. Instead vans are required to pick up passengers only by pre-arrangement. The Institute plans to appeal these remaining issues.

“This case will decide the fate of commuter vans in New York City, which each day carry 40,000 people to work, most of whom make minimum wage,” said Ricketts. “Commuter vans break the economic isolation found in city after city by not only putting people to work, but by taking people to work.”

“In important ways due process prevailed,” said Deborah Simpson, an Institute staff attorney. “The City Council can no longer so blatantly rig the system in favor of politically connected interests.”

“Van operators now look to the Giuliani administration to fulfil its commitment to authorize hundreds more commuter vans,” Mellor said.

Justice York ruled in Ricketts v. City of New York that, “It is fundamental to procedural due process that a licensee be given notice of adverse action by the licensing authority, and an opportunity to be heard. It must also be given reasons for an adverse decision.”