LINION, TAXI MEDALLION OWNER DRIVER 1S-Cv-E042

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LINION, TAXI MEDALLION OWNER DRIVER 1S-Cv-E042 Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 1 of 37 LINITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEV/ YORK ------x MELROSE CREDIT LINION, PROGRESSIVE CREDIT LINION, LOMTO FEDERAL CREDIT LINION, TAXI MEDALLION OWNER DRIVER ASSOCIATION, [NC., KL MOTORS,INC., SAFINI TRANSPORT, INC., WHITE & BLUE GROUP CORP., FIMA SERVICE CO., INC., CARL 1s-cv-e042 (AT) GINSBURG, aNd JOSEPH ITZCHAKY, Plaintiffs -against- THE CITY OF NEW YORK; THE NEW YORK CITY TAXI & LIMOUSINE COMMISSION; and MEERA JOSHI, in her Official Capacity as the Chair of the New York City Taxi & Limousine Commission, Defendants. ------x DEFENDANTS' REPLY MEMORANDUM OF LAW IN FURTHER SUPPORT OF DEFENDANTS'MOTION TO DISMISS THE AMENDED COMPLAINT ZACHARY W. CARTER Corporation Counsel of the City of New York Attorney for Defendants 100 Church Street New York, New York 10007 (212) 3s6-219e June24,2016 MICHELLE GOLDBERG-CAHN, KAREN SELVIN, Of Counsel. SAMANTHA SCHONFELD, On the Memorandum Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 2 of 37 TABLE OF CONTENTS Page TABLE OF AUTHORITIES lll ARGUMENT POINT I PLAINTIFFS FAIL TO MEET THRESHOLD REQUTREMENTS.... ,........ 1 A. Plaintiffs Lack Standing ............ I B. Res JudicataBarc Plaintiffs' Claims 4 C. Claims are Barred by Doctrine of Laches 6 POINT II. 9 PLAINTIFFS' EQUAL PROTECTION CLAIMS FAIL AS A MATTER OF LAW, 9 A. Medallion Taxicab Owners Are Not Similarly Situated to FHV Operators As a Matter of Law... 9 B. Regulatory Distinctions Between Medallion Taxis and FHVs Are Presumptively Valid and Rational. l3 POINT III ,,,,.,, 17 PLAINTIFFS' TAKINGS CLAIMS ARE NOT RIPE FOR JUDICIAL REVIEW AND FAIL AS A MATTER OF LAW l7 A. Plaintiffs Have Not Sought Just Compensation in State Court, and Thus, Their Takings Claims Are Not Ripe l7 B. Plaintiffs'Takings Claims Must Be Dismissed As a Matter of Law 20 POINT IV 23 PLAINTIFFS' DUE PROCESS CLAIMS FAIL AS A MATTER OF LAW.. 23 Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 3 of 37 Page POINT V ,,,27 PLAINTIFFS' STATE LAW FRAUD CLAIM SHOULD BE DISMISSED. 27 CONCLUSION 29 lt Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 4 of 37 Page TABLE OF AUTHORITIES Page(s) Cases 520 East 81st Street Assoc. v. State of New York, ee N.Y.2d 43 (2002) l8 Alfonso v. Fernandez, 195 A.D.2d 46 (2d Dep't 1993) 5 Black Car Assistance Corp. v. City of New York, 2013 N.Y. Misc. LEXIS 1692 (April23,20l3), aff d,2013 N.Y. App. Div LEXIS 6919 (lst Dep't Oct.29,2013) 7 Boston Taxi Owner's Ass'n v. Cit)'of Boston, 2016 U.S. Dist. LEXIS 43496 (D. Mass. Mar. 31, 2016).... 15,2 I City of Cleburne v. Cleburne Living Center. Inc., 473 U.S. 432 (re9s)... l3 Concrete Pipe & Prods. v. Constr. Laborers Pension Trust, s08 u.s. 602 (tee3).... .22 D'Antonio v. Metro. Transp. Auth, 2008 U.S. Dist. LEXIS 16726 (S.D.N.Y, Mar.4,2008) ,,.,,,',,.'28 Dawson v. Higsins, 154 Misc. 2d 811 (N.Y. Sup. Ct., N.Y. Co. 1992). l8 Dreher v. Doherty. 531 Fed. Appx. 82 (2d Cir. 2013) t9 Ferris v. Cuevas, I l8 F.3d t22 (2d Cir. 1997) 4 Ford v. New York State Racing & Wagering Bd., 24 N.Y.3d 488 (2014)....... 5 Gansemi v. City of New York, l3 Misc. 3d lll2 (NI.Y. Sup. Ct., Kings. Co. 2006). l8 Gebresalassie v. District of Columbia, 2016 U.S. Dist. LEXIS 35093 (D,D,C. Mar. 18,2016) 10, 13, 14 lil Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 5 of 37 Page C Health & 164 F.3d 789 (2d Cir. 1999). ,',,,,,.,,,29 v. Arthur Andersen 72F.3d 1085 (2d Cir. 1995) 2 Jackson Sawmill v. United States. 428F. Supp. 555 (1977), affd,580 F. 2d302 (1978), cert. denied,439 U.S. t070 (t97e).......... .2'l Joe Sanfelippo Cabs, Inc. v, Cit)' of Milwaukee, 46 F. Supp.3d 888, 893 (8.D. Wisc. 2014) .,,.,.,14 Kim v. City ofNew York, e0 N.Y.2d t (t997).... 18 Lingle v. Chevron U.S.A.. Inc., s44 U.S. s28 (200s) 20 Marom v. Cit)¡ of New York, 2016 U.S. Dist. LEXIS28466 (S.D.N.Y. }l4ar,7,2016) 13 Minneapolis Taxi Owners Coalition" Inc. v. Cit)' of Minneapolis, 572F.3d 502 (8th Cir.2009) .21 Nnebe v. Daus, 644 F.3d 147 (2d Cir. 201 l) ,,2,3 Peanut Ouota Holders Ass'n v. United States, 421 F.3d 1323 (Fed. Cir. 2005)......... .....20,21 Penn Central v of New York. 438 U,S. 104 (1978) 22 Pharr v. Evergreen Garden. Inc., 123 Fed. Appx. 420 (2d Cir. 2005). 6 Rogers Truck Line v. U.S., 14 cl. ct. 108 (cl. ct. 1987)......,........,. .21 Ruston v. Town Bd. for Skaneateles, 610 F.3d 5s (2d Cir.2010). ,,12 Sanitation & Recycling Indus. Inc. v, City of N.Y., 928 F. Supp, 407 (1996),af?d,197 F,3d987 (1996) ,,',,,,,,','23 tv Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 6 of 37 Page Santini v. Connecticut Hazardous V/aste Mgmt. Serv., 342F.3d 1 l8 (2d Cir. 2003). t9 r tA" c (Brt Slnnrrtn nn hehclf nf Nøthnn v. Jnsenh 183 A.D.2d 102(3d Dep't 1992) 6 Corr. Svcs. 719 F.3d 127 (2d Cir. 2013). ..14 St. Pierre v. Dyer, 208 F.3d 394 (2d Cir. 2000). 5 United States v. Schmitt, 999F. Supp.317 (E.D.N.Y. 1998) 28 Valley Forge Christian College v. Americans United for Separation of Church and State" Inc., 454 U.S. 464 (1982)... 2 Villager Pond, Inc. v. Town of Darien, 56 F.3d 375 (2d Cir. 1995). t9 Williamson County Regional Planning Comm'n v. Hamilton Bank, 473 U.S. t72 (r98s) .,17, 19 Statutes Laws of the State of New York, Chapter 9 (2012)..... ,20 NYC Administrative Code g 7-201(a) .28,29 NYC Administrative Code $ l9-502(l).. l0 NYC Administrative Code $$ 19-502(g) 10 NYC Administrative Code g 19-502(u).... ,........1I NYC Administrative Code $ 19-504(i)... ',,,,,,23 NYC Administrative Code g l9-504(Ð .16 NYC Administrative Code g 19-515(a).. l6 NYC Administrative Code $ l9-516(a) t6 New York City Charter $ 1043 et seq... 24 N.Y. General Municipal Law $ 50-e ..... 28 Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 7 of 37 Page Other Authorities 35 RCNY $ sl-03 ,,,.,,,.22,23 3s RCNY $ sa-17(e)......... ,... ... .. .... I I 3s RCNY $ s5,04(h)........ ,...,......... l6 35 RCNY $ ss-04(i) ........,.....16 3s RCNY $ ss-l1(aX1) .............. l6 35 RCNY $ s8-21(cXsXxii)... 8 3s RCNY $ s8-26(i) 14 3s RCNY $ s8-26(a)(l).......... ll 35 RCNY $ 58-43 ',,20 35 RCNY $ 58-s0 3,8,9,23 3s RCNY $ s8-s0(c). .24 3s RCNY $ s8-s0(e). 24 3s RCNY S 58-s0(h) I 3s RCNY $ s8-s0c) ,,,,,,,,,,,,..3,8,26 35 RCNY seA-03(c)(3).. .....,.,..........,... I I 35 RCNY $ seA-2e(d).... .,.........,..,.,..... l6 35 RCNY $ seB-26(a).... t6 CPLR $ 7806 t7 FRCP 9......... .28 FRCP 12(bxl)..... t7 FRCP 12(bX6).,.... I New York State Constitution Article 1, Section 7 ....... I 8 vl Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 8 of 37 Defendants submit this reply memorandum of law in further support of their motion to dismiss the Amended Complaint pursuant to FRCP 12(bxl) and l2(b)(6). As detailed herein, the girth of Plaintiffs' Memorandum of Law in Opposition to Motion to Dismiss, dated June 6, 2016 (Pls. Opp. Memo"), does not obfuscate the fact that plaintiffs' claims lack any and all merit and should be dismissed. POINT I PLAINTIF'FS FAIL TO MEET THRESHOLD REOT]IREMENTS. A. Plaintiffs Lack Standing 1. Credit Union Plaintiffs As previously detailed in defendants' initial motion to dismiss papers, the Credit Union Plaintiffs have failed to establish that they are within the zone of interest of the regulations they challenge or that they have suffered an injury-in-fact that is redressable in this proceeding. Notably, in their opposition, plaintiffs do not contend that they are for-hire transportation providers in the City of New York or that they are subject to regulation and oversight by TLC. Instead, they simply assert, in a conclusory fashion, that they have ooadequately alleged that they are within the zone of interest of the challenged regulations," and that they have suffered an injury from the 'oimpairment of their security interest in the medallions, an increasing number of loan deficiencies, troubled debt restructurings, foreclosure, and inevitable balance sheet losses." See Pls. Opp. Memo, at 60-61. In other words, the Credit Union Plaintiffs are asserting that they have standing to bring the instant lawsuit based on their own business failings and lack of due diligence when providing medallion loans. Yet, in their l16 page opposition memorandum plaintiffs fail to identify a single case where a financial lender's poor business decisions provide it with standing to overturn regulations that are solely applicable to its borrower. Case 1:15-cv-09042-AT Document 66 Filed 06/24/16 Page 9 of 37 It is well-settled that to establish standing, a party must assert its own legal rights and interests, not those of a third party. See Valley Forge Christian College v. Americans United for Separation of Church and State. Inc., 454 U.S. 464,474 (1982); Hirsch v.
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