CLASSIC CAB INC. et al v. DISTRICT OF COLUMBIA et al

Filing 19

MEMORANDUM OPINION re 18 Order. Signed by Judge Christopher R. Cooper on 4/11/2018. (lccrc1)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
CLASSIC CAB, INC., et al.,
Plaintiffs,
v.

Case No. 17-cv-2820 (CRC)

DISTRICT OF COLUMBIA, et al.,
Defendants.
MEMORANDUM OPINION
Beginning in 2016, the District of Columbia’s Department of For-Hire Vehicles adopted
a series of rules that require taxicab operators to transition from traditional analog metering
systems to newer systems called “digital taxicab solutions,” or “DTS.” Designed to resemble
popular ride-hailing services like Uber and Lyft, DTS systems run on mobile devices and
calculate fares using GPS technology.
Classic Cab, Inc., a taxicab operator in the District, along with its owner, filed a
complaint and a motion for a temporary restraining order late last December seeking to halt the
DTS requirement from going into effect at the beginning of the new year. They claimed that the
Department’s rules violated several federal constitutional provisions and that its rulemaking
process violated the District of Columbia Administrative Procedure Act (“D.C. APA”). After a
hearing, the Court denied the plaintiffs’ motion, finding that they were unlikely to succeed on
any of their federal constitutional claims and, in turn, that the Court would unlikely exercise
supplemental jurisdiction over their D.C. APA claim. Memo. Op. at 16, 18–19 (ECF No. 14).
The District has now moved to dismiss this case. It relies primarily on this Court’s
analysis in its decision denying the plaintiffs’ motion for a temporary restraining order. The
plaintiffs’ opposition mostly reiterates the arguments made in its previous motion and, more

generally, it emphasizes the difference between the preliminary injunction standard (whether the
plaintiffs have shown a likelihood of success on the merits) and the standard governing dismissal
for failure to state a claim (whether the facts as stated in the complaint plausibly entitle the
plaintiff to relief). Even if the Court found little likelihood of success on the merits of their
claims, the plaintiffs argue, the facts stated in their complaint establish constitutional violations.
The Court disagrees. While of course the standards governing preliminary relief and
dismissal are different, the Court for essentially the same reasons stated in its previous order
finds that the plaintiffs have not stated a federal claim on which relief can be granted.
The Court will not fully repeat its previous analysis here but, to summarize: On the
plaintiffs’ due process claim, even assuming that they were deprived of a cognizable property
interest in the value of their taxi business or in their contract with Creative Mobile Technologies,
the notice-and-comment process that the District afforded, as detailed in the complaint, was
constitutionally adequate. See Bi-Metallic Inv. Co. v. State Bd. of Equalization, 239 U.S. 441,
445 (1915); Pickus v. U.S. Bd. of Parole, 543 F.2d 240, 244 (D.C. Cir. 1976). Nor have the
plaintiffs stated a claim under the Contract Clause of Article I. Even assuming that they could
establish that the Department’s regulations substantially impaired their contractual relationship,
they have not plausibly asserted that the regulations were not “reasonable and necessary to serve
an important public purpose,” as is required to show that an impairment of contract violates the
Contract Clause. U.S. Trust Co. v. New Jersey, 431 U.S. 1, 25 (1977); see also Keystone
Bituminous Coal Ass’n v. DeBenedictis, 480 U.S. 470, 505 (1987) (“[W]e have repeatedly held
that unless the State is itself a contracting party, courts should properly defer to legislative
judgment as to the necessity and reasonableness of a particular measure.” (internal quotation
omitted)); United Auto., Aerospace, Agr. Implement Workers of Am. Int’l Union v. Fortuno, 633

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F.3d 37, 43 (1st Cir. 2011) (explaining that “lack of reasonableness or necessity to an important
governmental purpose” is one of the two essential elements of a Contract Clause claim).
That leaves the plaintiffs’ claim under the D.C. APA. 1 Generally, when all of a
plaintiff’s federal claims are dismissed before trial, a federal court should decline to exercise
supplemental jurisdiction over any remaining (non-federal) claims. 28 U.S.C. § 1367(c)(3)
(allowing district court to decline supplemental jurisdiction if the court “has dismissed all claims
over which it has original jurisdiction”); see also United Mine Workers of Am. v. Gibbs, 383
U.S. 715, 726 (1966) (“Certainly, if the federal claims are dismissed before trial . . . the state
claims should be dismissed as well.”); Robinson v. Palmer, 841 F.2d 1151, 1157 (D.C. Cir.
1988) (endorsing district court’s refusal of supplemental jurisdiction over claim under the D.C.
APA and its suggestion that D.C. local courts were preferable forum for that claim). Thus,
because the Court is dismissing all of the plaintiffs’ federal claims, it will dismiss their D.C.
APA claim as well.
The Court will therefore dismiss the plaintiffs’ complaint pursuant to Federal Rule of
Civil Procedure 12(b)(6). A separate Order accompanies this Memorandum Opinion.

CHRISTOPHER R. COOPER
United States District Judge
Date: April 11, 2018

1

In its previous decision, the Court evaluated the plaintiffs’ likelihood of succeeding
under the Takings Clause of the Fifth Amendment and under the Dormant Commerce Clause. It
did so because the plaintiffs raised these theories in their motion for a temporary restraining
order. But as the District points out, these claims appear nowhere in the complaint, and thus are
not properly before the Court at this stage of the proceedings.

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