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New York's 'Taxi of Tomorrow' deal with Nissan voided by judge

By Joseph Ax

NEW YORK (Reuters) - New York City's plan to create a uniform taxi fleet was struck down by a judge on Tuesday, only weeks before Nissan Motor Co Ltd was due to start supplying new taxis under an exclusive contract.

The "Taxi of Tomorrow" initiative, which was to go into effect October 28, would have required every new taxi to be a Nissan NV200. Nissan was given a contract worth an estimated $1 billion in 2011 after a competition.

Manhattan State Supreme Court Justice Shlomo Hagler ruled that the Taxi and Limousine Commission had overstepped its authority. In part, he relied on the same legal argument that doomed Mayor Michael Bloomberg's effort to ban large sugary drinks from city eateries, saying the commission had infringed upon the City Council's powers.

"The notion that New York City should have one exclusive 'iconic' New York City taxicab is a policy decision that is reserved for the City Council," he wrote.

The city's chief lawyer, Michael Cardozo, said in a statement, "We believe the Court's decision is fundamentally wrong, and we intend to appeal immediately."

When the 10-year contract was awarded, Nissan officials said they expected to provide as many as 26,000 vehicles to the city's taxi fleet over the deal's lifetime.

Travis Parman, a Nissan spokesman, said the company was considering its options, but it would still sell the vehicle to interested fleet owners.

"We are disappointed in the court's decision, but it will not prevent our plan to start upgrading the NYC taxi fleet with the Nissan Taxi of Tomorrow at the end of the month," he said.

The ruling was the second time a state judge has blocked the plan, after Justice Peter Moulton in Manhattan ruled in May that the initiative failed to comply with city regulations allowing taxi operators to buy hybrid vehicles.

The taxi commission then revised the plan to permit hybrid models until Nissan provides a hybrid version of the NV200.

The lawsuit was brought by Evgeny Freidman, a major city fleet operator, and the Greater New York Taxi Association, who claimed the commission did not have the power to force taxi operators to purchase a particular vehicle.

(Reporting by Joseph Ax)

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