Hamstrung Toronto cab owner/operators say they were left with "no choice" but to initiate their $1.7-billion class action suit against the City.
On August 10, they filed a Statement of Claim in Ontario Superior Court (subsequent to last month’s Notice of Action), their business cut by more than half by Uber and Lyft, their plate and rental values basically now worth next to nothing, and the powers-that-be at city hall demonstrating little interest in heeding their calls for help, and with the Review of the new Vehicle-For-Hire bylaw more than a year behind schedule, and not projected to hit Council before the spring of 2019).
The newly formed All Toronto Owners and Operators Ltd. (ATOOL) alleges the City has reneged on a "social contract" struck up with them decades ago, while facilitating the easy entry of Uber and other Private Transportation Companies (PTC’s) into the Toronto market .
"We have no choice. This is our last kick at the can," says Lucky 7 Taxi owner Lawrence Eisenberg, one of three plaintiffs, alongside Taxi Action president Behrouz Khamseh, and driver Sukhvir Thethi. "They told us our taxi license was our pension, and they took it away.
"We’ve cooperated, and followed the bylaw for the last 30 years. Uber comes in, where’s the bylaw? They played for three years (without a license), and then the City put in a bylaw just for them. What’s going on here?"
Plate-holder Carl Rotman, 86, finds it "disgusting" the way Toronto – and major cities across North America -- have allowed Uber to successfully lobby for its own PTC licensing model (which includes unlimited entry, and what amounts to self-regulation). In Toronto’s case, the pot was sweetened by PTC’s agreeing to pay the City 30 cents on every run made by one of their vehicles.
Rotman alleges the new bylaw belies Mayor’s John Tory’s promise of a level playing field between taxis and PTC’s. He and his wife Donna are now finding it a tight squeeze in what should be their golden years.
"(This class action), it’s a last resort. This time we have to do it," he says. "We have some ammunition."
More than 63 years in the taxi business, he suggests the City’s brain trust, "doesn’t want to hear from us." However, he claims it’s a longstanding unwritten rule that elected officials have a responsibility to protect the general public -- including the 10,000-plus members of the taxi industry and their families who have been so adversely affected.
"That’s their first responsibility, their constituents – not some (corporation) outside the borders of their country," he adds.
Taxi industry leaders say the new bylaw has created a "Wild West" scenario on Toronto streets, between the unlimited number of untrained (and questionably screened and insured) PTC drivers, the heightened downtown gridlock and pollution, and the reportedly high number of sexual assault charges against Uber X drivers.
"The public safety is at risk. This is how the City of Toronto has acted. They just forgot about that responsibility," he alleges. "That’s what counts in a court of law."
Thirty-one years on the road, Khamseh suggests the cab industry’s problems are a direct product of the incompetence and/or hidden agenda of Toronto’s politicians and bureaucrats.
"The City basically did not give a damn about what’s happening to the taxi industry," he alleges. "They were not trying to fix the problems. They were just looking at leveling the taxi business and moving on."
The situation makes him "sad and angry at the same time".
"I’m talking about my whole life," he continues. "Many times my kids were still sleeping when I went to work in the morning, and when I came home they were asleep. They didn’t know their father."
"(Driving) 12 to 13 hours a day just to survive. What kind of life is that? You were hoping at some point you’d get your own plate."
He and Thethi were among the five Toronto cabbies who staged a five-day hunger strike outside Toronto city hall in December of 2015, to peacefully protest the City’s lax enforcement against Uber (which at that point was unlicensed, and claimed to be a "technology company" and not a taxi service).
In the early 2000’s, Eisenberg spearheaded an unsuccessful legal action against the City (by the now-defunct Toronto Taxicab Owners and Operators Association), challenging the legality of the Ambassador Taxi program.
He says plate values have crashed from a pre-Uber high of $380,000, to around $30,000 today.
He notes the taxi driver is free to walk away from the industry at any time. But he stresses, "Where is the owner going, after staking his life’s investment in a taxi plate now generating a bare fraction of its previously monthly income?"
According to the MLS, 175 plates are currently sitting on the shelf, and industry leaders estimate more than twice that many are sitting on desks at the brokerages and garages.
As a 55-year industry veteran, there’s no doubt in his mind how all this transpired.
"(The City), they deregulated us without using the word," he alleges. "Instead of 5,500 taxis vying for a piece of the pie, there’s now 75,000 PTC’s and the 5,500. And the federal government says they’re taxis. The City can’t do that. They think they can do it."
He’s mildly encouraged by the Province of Quebec’s recent announcement that it will be awarding $250 million in compensation to taxi interests for their losses due to PTC’s.
"It’s a step in the right direction. Somebody’s putting their money where their mouth is," he comments.
"It makes our case a little bit stronger," Khamseh agrees, "that another jurisdiction, they realized the damage they created."
He asserts the taxi business is suffering from the same problems in Toronto, Ottawa, Boston, Chicago, and all of the big cities.
"Imagine if the taxi industry in these various cities got together," he adds, "You’d have a huge force. They’re all suffering from the same common problems right now."
ATOOL’s 10-page submission alleges numerous inequalities and illegalities in the Vehicle-For-Hire bylaw. They cite the audacious $130 VFH Driver’s Fee owner/operators must now pay on top of their $975 plate renewal (for which they have received no explanation from MLS staff).
Eisenberg also wonders how Uber was able to operate "with impunity" for three years prior to being licensed – noting there were 30 to 40 outstanding charges against Uber X drivers, "that never made it to court."
Toronto Legal has 20 days to respond to the Statement of Claim, before the matter goes to a Show Cause hearing, where an Ontario Superior Court Justice will determine whether or not the class action application has sufficient grounds to proceed.
"The City is saying, ‘Take us to court’, so we’re taking them to court. They’re not answering the questions," he adds.
"Uber’s not the problem, it’s the City… The City is there to to regulate the taxi industry and protect the public. You don’t go into a business if you can’t make any money. Who in their right mind would go into the taxi business now