A new Massachusetts law signed by Governor Charlie Baker that established the first statewide rules for Uber, Lyft, and other ride-hailing services is being challenged in court by a group of Boston taxi owners as unconstitutional.
The Boston Taxi Owners Association filed the lawsuit Friday in US District Court against Baker and several other Massachusetts officials.
The lawsuit marks the latest salvo in the taxi industry’s fight in Boston and across the nation against the rise of its popular digital-age competition, which allows passengers to summon a ride from drivers with the touch of a button.
The taxi industry group said the so-called Uber law, which was among the most high-profile measures of the last legislative session, violates its members’ equal protection rights, because it prevents municipalities from regulating ride-hailing companies in the same way they do cabs.
The law leaves regulation of those digital companies solely to the state.
The taxi companies said they now face an unfair dynamic in which they must follow strict city rules governing fares, vehicle design, background checks, insurance rates, and more, while Uber drivers and other transportation network companies — called TNCs in the industry — do not.
“The two industries, taxicab and TNCs, provide essentially identical services, yet with the enactment of the TNC Law are being regulated in an entirely different manner from each other,” the cab owners said in their lawsuit.
Baker’s office did not comment directly on the suit. Instead, spokesman Billy Pitman said the governor “was pleased” to have signed off on the new oversight of the industry passed by the Legislature this year.
Uber and Lyft were not named in the suit. Both companies declined to comment.
The new state law sets standards for ride-hailing companies that are more permissive than local taxi regulations. It requires drivers to pass background checks from the companies and the state, but does not require drivers to undergo fingerprint-based checks that Uber has strongly resisted. It also sets favorable insurance standards for the companies.
The taxi owners assert that the law creates “a system where two similarly situated industries are being regulated by different government bodies in an entirely unequal way, thereby violating the taxi owners’ constitutional rights.”
Additionally, they say their “exclusive right to provide for-hire transportation,” secured through city-issued taxi licenses called medallions, has been violated by Uber and Lyft’s presence.
The suit asks the court to declare the law unconstitutional, bar the state from implementing it, and require transportation network companies to follow municipal taxi rules.
The taxi companies have invoked equal protection rights in another lawsuit they filed against the city of Boston in 2015. In March, US District Court Judge Nathaniel Gorton ordered the Walsh administration to revise the way the city regulates taxicabs and ride-hailing firms by the end of September.
In his ruling, Gorton declined the city’s request to dismiss the cab owners’ equal-protection claims.
On Friday Gorton was assigned as the judge in the suit the cab owners brought against Massachusetts officials.
Mayor Martin J. Walsh’s office declined to comment on both lawsuits. However, in August the mayor said he wished the Legislature had given the city more control over Uber drivers, even though he said he wouldn’t necessarily hold them to the same standards as taxi drivers.
That outlook puts the mayor in the complicated position of agreeing with the taxi group that cities should be able to regulate Uber, while defending a lawsuit from the group asking a court to force him to do just that.
To add to the complexity, Walsh’s police commissioner, William Evans, has been an advocate for fingerprinting Uber drivers.
In a statement Friday, Evans said he had not reviewed the lawsuit against the state, but that he remains “a supporter of stricter oversight for ride-share companies and drivers to ensure the safety of the public who use their services.”
The taxi industry, however, has not been without controversy.
In August, Edward J. Tutunjian, who controls many medallions in the city, agreed to pay more than $2 million in fines and may face prison time in connection with federal tax and fraud offenses.
Elsewhere in the country, the city of Chicago, Miami-Dade County, and California’s Department of Public Utilities have all faced lawsuits from taxi groups or individual companies challenging Uber laws along similar equal-protection arguments. None of those suits has had a definitive court ruling yet.
Chicago’s lawsuit has advanced the furthest. A federal judge there has also declined to dismiss the equal-protection argument, a decision city officials are appealing.
In their suit against Massachusetts, the Boston taxi group said it represents “individuals who collectively own hundreds of taxicab medallions in the City of Boston.” The suit lists another plaintiff, Steven Goldberg, who according to the filing, owns three taxi medallions.
The taxi companies are also demanding compensation to cover losses related to the rapidly diminishing value of their medallions.
In the legislation, Massachusetts lawmakers did give cabbies one concession, requiring ride-hailing companies to pay a per-ride fee of 20 cents, a portion of which will be used to aid small taxi or livery companies.
And when Baker signed the law in early August, the governor said he was open to overhauling taxi rules.
“We’ve said to the taxi community on a number of occasions, if they want to come back and talk to us about things that we might do to make it easier for them to operate here in the Commonwealth, we’re wide open to having that conversation,” Baker said at the time.
Adam Vaccaro can be reached at email@example.com. Follow him on Twitter @adamtvaccaro.
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