City Attorney David Chiu confirmed that San Francisco won a lawsuit filed by the San Francisco Federal Credit Union (SFFCU) against the San Francisco Municipal Transportation Agency (SFMTA). The lawsuit was about loans given by SFFCU for taxi medallions, which are permits for taxi drivers to operate in the city. The California Court of Appeal upheld a previous verdict that the City did not violate its agreement with SFFCU.
The disagreement started when changes were made to the taxi medallion program. In 1978, San Francisco voters approved Proposition K, which offered free, non-transferable taxi medallions. Due to a long waitlist, SFMTA changed the program and sold transferable medallions for $250,000 each. SFFCU, which had a lender agreement with SFMTA in 2010 and 2013, financed these purchases.
The popularity of companies like Uber and Lyft reduced the demand for taxi medallions. This led to SFFCU foreclosing on taxi drivers, and no taxi medallions have been sold since 2016. SFFCU sued the City, claiming contract violation and lack of good faith for not maintaining a market for the taxi medallions.