Towncar companies set to sue after clash with city over fares

Towncar companies set to sue after clash with city over fares »Play Video

PORTLAND, Ore. - A local transportation company is on the verge of suing the city of Portland over what it calls unfair business practices.
 
The company, towncar.com, had to refund customers recently because the city said a recent promotion was illegal.
    
Towncar.com recently advertised a deal on Groupon for a $32 ride to the Portland airport.
 
The city got wind of the offer and said it was illegal and the fare was too low, forcing the company to either pay a big fine or refund customers. The company chose to issue hundreds of refunds but now say they plan to challenge the law.
 
Towncar.com and another limousine company said they will file a lawsuit on Friday.
 
The companies takes issue with a city law that enforces a minimum fare the towncar operators argue is 35 percent more than what taxis would charge.
 
 “The City of Portland is driving up transportation prices and destroying innovation in the transportation industry, just to help taxicab companies make more money,” Wesley Hottot with the Institute for Justice told KATU News. “Our argument is that it isn't just wrong, it's unconstitutional.”
 
Towncar.com said about 600 customers bought that original Groupon deal. If the companies hadn't refunded customers, they would have faced a fine of $895,000 - and suspension of operating permits.
 
The companies held at rally at Pioneer Courthouse Square Thursday morning. Supporters claim the current law makes it too difficult for them to make a living.