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Beginning and End of Cab Monopoly Suit

Beginning and End of Cab Monopoly Suit

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Published by Robert Wilonsky
Dallas' small cab companies claimed Yellow Cab and its parent company were illegally monopolizing the business. But as they fight with Uber and Lyft, they found a common enemy.
Dallas' small cab companies claimed Yellow Cab and its parent company were illegally monopolizing the business. But as they fight with Uber and Lyft, they found a common enemy.

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Published by: Robert Wilonsky on Feb 04, 2014
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02/22/2014

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COMPLAINT Page 1
 
IN THE UNITED
STATES DISTRICT COURT
FOR
THE NORTHERN DISTRICT
OF
TEXAS
 ASSOCIATION OF TAXICAB OPERATORS, USA, D.E.C.D.A, INC. d.b.a. STARCAB, MAREDI CORPORATION d.b.a UNITED CAB, E.P.D.A., INC. d.b.a ALAMO CAB, INC., WALAAL CORPORATION d.b.a. AMBASSADOR CAB COMPANY, and PLAINTIFFS LISTED IN EXHIBIT A, Plaintiffs, v. JACK BEWLEY, JEFF FINKEL, DAYRA CORPORATION d/b/a EXECUTIVE CAB COMPANY, KHORSHID, INC. d/b/a TAXI DALLAS, and ZYBA CORPORATION d/b/a GOLDEN CAB Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Civil Action No. ________ COMPLAINT
1. Plaintiffs, the Association of Taxicab Operators, USA, D.E.C.D.A, Inc. d/b/a Starcab, Maredi Corporation d/b/a United Cab, E.P.D.A., INC. d/b/a Alamo Cab, Inc., Walaal Corporation d/b/a Ambassador Cab Company, and all the individuals listed in the Rule 10(a) Compliant Caption for Complaint which was filed with the Original Complaint, (collectively,
“Plaintiffs”), file this
 Complaint alleging antitrust violations against Defendants Jack Bewley, Jeff Finkel, Darya Corporation d/b/a Executive Cab Company, Khorshid, Inc. d/b/a Taxi Dallas, and Zyba Corporation d/b/a Golden Cab, and in support thereof, state the following:
Case 3:12-cv-04508-N Document 1 Filed 11/08/12 Page 1 of 18 PageID 1
 
 
COMPLAINT Page 2
 
I. PRELIMINARY STATEMENT
 2. An individual cannot obtain the authority to operate a taxicab in Dallas, Tarrant and Collin Counties. Instead, licensed taxicab drivers must contract with franchise or annual  permit holders
(“Holders”)
 which have been approved by local regulators, including the cities of Dallas, Fort Worth, Addison, Arlington, Hurst, Irving, Mesquite, Plano, and DFW Airport, to operate fleets of taxicabs. The drivers are not employees of the Holders. They are independent
contractors who pay Holders a “Stand Fee” in exchange for the right to
 operate an authorized taxicab. Through various entities, including the Defendant entities, two individuals
 – 
 Defendants Jack Bewley and Jeff Finkel
 – 
 assert dominant control over approximately 75% of the authorized taxicabs in Dallas, Tarrant, and Collin Counties. Irving Holdings, Inc. owns 100% of Yellow Checker of DFW, Freedom, Eagle, JetTaxi, Diamond, State, and U.S. Cab (collectively, the
Defendants’ “Co
-
Conspirators”)
. Bewley and Finkel are the only directors or owners of
Defendants’ Co
-Conspirators. Through management contracts
 – 
 or some other non-public governance mechanism
 – 
 Bewley and Finkel or entities they own and direct exercise effective control over Executive, Taxi Dallas, and Golden taxi companies. Executive, Taxi Dallas, and Golden
 – 
 with their approximately 23% of the marketplace
 – 
 were brought into the fold in late April, 2012. To summarize, then, using entities they control by various means, Defendant Bewley and Finkel control 75% of the relevant market
 – 
 which is authorized taxicabs in Dallas, Tarrant, and Collin Counties. 3. Having achieved this level of market dominance through consolidation, Defendants and their Co-Conspirators have (1) fixed Stand Fee prices across the relevant product
Case 3:12-cv-04508-N Document 1 Filed 11/08/12 Page 2 of 18 PageID 2
 
 
COMPLAINT Page 3
 
market, (2) engaged in predatory pricing with respect to Stand Fees, and (3) engaged, and are continuing to engage, in a conspiracy to monopolize the market. The Plaintiff taxicab companies are Defendant Entities
 competitors in the market. The individual Plaintiffs are drivers who pay Stand Fees to Holders and drive taxicabs authorized to operate in the relevant geographic market. The Association of Taxicab Operators, USA is a trade group representing the interests of its member drivers situated as the individual Plaintiffs, but lacking the financial means to join the litigation personally. Plaintiffs bring this suit to stop
Defendants’ antitrust violations by
 breaking up
Defendants’ market
consolidation and to redress the damages Plaintiffs already have sustained since
Defendants’
 scheme started.
II. PARTIES AND SERVICE OF PROCESS
 4. The individual Plaintiffs listed in the attached Exhibit A
 – 
 Rule 10(a) Compliant Caption for Complaint, are individually licensed taxicab drivers who regularly operate taxicabs for hire within this District. 5.
Plaintiff, D.E.C.D.A., Inc. d/b/a StarCab, (“Star”), is a Texas Corporation with its
 principal place of business in within this District. 6.
Plaintiff, Maredi Corporation d/b/a United Cab Company (“United”),
 is a Texas Corporation which regularly and routinely conducts business within this District. 7.
Plaintiff, E.P.D.A., Inc. d/b/a Alamo Cab, Inc., (“Alamo”), is a Texas Corporation
with its principal place of business within this District. 8. Plaintiff, Wal
aal Corporation d/b/a Ambassador Cab, (“Ambassador”), is a Texas
Corporation with its principal place of business within this District.
Case 3:12-cv-04508-N Document 1 Filed 11/08/12 Page 3 of 18 PageID 3

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