SAN FRANCISCO (KPIX 5) — A case centered around the meltdown of San Francisco’s taxi industry that has occurred over the course of nearly a decade could finally be edging towards a conclusion.
At the center of it are the medallions drivers purchased for as much as $250,000. Once considered a sure investment, the medallions have returned untold misery for many of those drivers.
A lawsuit filed over the taxi medallion issue is now in the hands of a judge. A tentative ruling could come as soon as Thursday.
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“25 years I’ve done this job,” Chris French told KPIX in 2017. “I’ve always complied with the rules and regulations. I’m just trying to earn an honest living.”
French was just one of the cab drivers who was ultimately crushed by the debt of something he worked a quarter century for. San Francisco envisioned the medallion program as a revenue maker when they were initially sold for $250,000. Almost simultaneously came the rise of ride-hailing apps Uber and Lyft.
In 2018, KPIX first reported on the where the vast majority of that debt was residing. It was the San Francisco Federal Credit Union which sued the city that year, claiming damages suffered through its taxi medallion loans.
“Obviously, that damage figure changes over time,” said attorney Daniel Bailey with the Joseph & Cohen law firm. “Presently were looking at at least $155 million and rising.”
Bailey is part of the team representing the credit union. He said the city knows the program has failed.
“In a public report, the city’s own taxi industry expert said that the program was only stalled, i.e., it could come back to life at any second,” explained Bailey. “But in a secret report that we obtained through discovery from a third party, that same expert said the program wasn’t viable.”
Attorneys for the credit union are arguing that San Francisco has effectively allowed the medallion program to die, just without declaring it dead. The credit union’s case, however, is theirs alone.
A court victory for the credit union would not necessarily help struggling drivers, although San Francisco Federal Credit Union says a loss would not further jeopardize any medallion holders.
The San Francisco City Attorney’s office responded in a statement that said in part, “the city and the credit union have a contract. The city has not broken that contract, so San Francisco taxpayers should not be forced to bail out this financial institution.”
The city also says the lawsuit has made it impossible to negotiate any changes to the medallion program.
On Thursday, a judge is expected to issue a tentative ruling on whether or not the credit union can proceed with its case. If the case is dismissed, the credit union says it will appeal. If the judge allows the case to proceed, it could be heard by a jury as soon as April.