Portland, Ore.—Today, two Portland sedan companies announced their intent to appeal a ruling from the U.S. District Court for the District of Oregon dismissing their lawsuit challenging the constitutionality of Portland’s pro-taxi, anti-consumer sedan regulations. The regulations require sedan companies to charge 135% as much as taxicab companies anywhere they go, keep a minimum of $50 for trips to the airport, and require passengers to wait one hour before they can be picked up.

The lawsuit was sparked in 2012 when Portland threatened to imposed $895,000 in fines on two sedan companies—Towncar.com and Fiesta Limousine—for offering $32 promotional fares on Groupon.com. The city also threatened to revoke the companies’ operating permits, which would have put them out of business, if they did not immediately cancel the deals and refund their customers.

In a 19-page opinion, Judge John V. Acosta ruled that since Towncar.com and Fiesta Limousine complied with the city’s demands, they cannot bring a constitutional challenge to the three regulations.

Judge Acosta wrote: “Plaintiffs did, in fact, cancel the promotions and refund the money and have continued to provide Executive Sedan services without interruption” and “[a]ccordingly, Plaintiffs were not deprived of the right to pursue their chosen occupation but were merely deprived of the right to advertise or promote their businesses by offering reduced rates which violate the Fare Regulations.”

“A business does not have to go out of business in order to challenge the constitutionality of a law,” said Wesley Hottot, an attorney at the Institute for Justice, who represents the two sedan services. “We will appeal this ruling to the Ninth Circuit.”

“Portland threatened to bankrupt my company with a $635,500 penalty,” said Michael Porter, the CEO of Towncar.com. “All we are asking for is the right to charge our customers a reasonable price.”

“This case is about a businesses’ right to operate free from unreasonable governmental restrictions that were designed to protect the city’s existing taxicab companies, rather than the riding public” added Hottot. “That isn’t just wrong. It’s unconstitutional, and we’re confident that a higher court will agree with us.”

To learn more about this case, visit: www.ij.org/PortlandSedans

To watch a brief video on this case, visit: www.ij.org/PortlandSedansVid