The largest taxi company in the Lower Mainland is suing nearly every one of its competitors over the right to profitable passenger pickup contracts at Vancouver International Airport (YVR).
According to a September 16 B.C. Supreme Court notice of civil claim, Yellow Cab Co. has filed suit against the Lower Mainland Taxi Association and members including Bonny’s Taxi, Coquitlam Taxi, Delta Sunshine Taxi, Guildford Cab, Kimber Cabs, Newton Whalley Hi Way Taxi, North Shore Taxi, Richmond Cabs, Royal City Taxi, Sunshine Cabs, Surdell Kennedy Taxi and White Rock South Surrey Taxi.
The suit revolves around a highly competitive bid process for pickup licences at YVR, which Yellow claims it’s been cut out of thanks to the illegal actions of the association and an opaque bidding process at the YVR.
Yellow Cab has held licences to pick up passengers at the airport for decades, and it was the second largest licence holder, with 62, among association members.
Peter Gall, a partner with law firm Heenan Blaikie acting on behalf of Yellow, said the company’s revenue would take a hit if it’s cut out of the airport pickup business.
“I don’t have exact numbers, but that would be a significant loss for Yellow,” Gall told Business in Vancouver.
Lower Mainland taxi companies, including Yellow, formed the association in 2009 to improve relations with the airport authority, speak collectively on issues of concern and eliminate cab shortages at YVR.
The current licences held by Yellow and the association members are set to expire next February, meaning that each company would have to re-apply for its contract with the airport.
According to court documents, in June 2010, the airport authority told the association members it would prefer a “common concession for passenger pick-up at YVR” beginning March 1, 2012.
YVR allegedly told the members the annual cost to run the pickup program would be approximately $1.8 million.
Gall said Yellow Cab was interested in bidding for what it believed could be a contract to exclusively serve YVR, effectively seizing control of all pickup business at the airport.
In the fall of 2010, the claim alleges, the association pursued its own bid to land an exclusive contract for its members at YVR, effectively pitting Yellow Cab against the association it had helped form.
The association then allegedly demanded Yellow drop its bid for the contract and allow the association to act as the “exclusive bargaining agent” for all negotiations with the airport.
Yellow refused.
“The association was never formed for the purpose of bidding on the contract,” Gall said. “Yellow is of the view that the association doesn’t have the ability or authority to actually bid on the contract as an entity to itself.”
In July, the situation deteriorated to the point that the association demanded an “extraordinary general meeting” be held with a resolution to kick Yellow out of the association, court documents show.
It’s further alleged the association members intended to not only win the contract from YVR and strip Yellow of its membership, but also then divide the company’s licences among themselves.
On September 14, all 16 members of the association allegedly attended a meeting where a 12-4 vote stripped Yellow of its membership.
Black Top and Checker Cabs, Maclure’s Cabs and Vancouver Taxi, along with Yellow, voted against the resolution.
Black Top, Maclure’s and Vancouver have not been targeted in the suit.
A representative from the association refused to comment on the suit, but said, so far, YVR has not awarded any new pickup contracts.
Still, Yellow’s lawyers say YVR’s bidding process for new contracts has been opaque, inviting suspicion from different cab companies that the process hasn’t been fair.
YVR could not be reached for comment.
Gall said the bidding process should be started over.
“They should start the process afresh,” he said. “It should be an open and transparent process with a formal [request for proposal] … so it’s fair and transparent.”
Yellow is seeking declarations that the association breached its constitution and bylaws when it required Yellow to abandon its bid for the contract and stripped the company of its membership. •
