Santos v. City of Houston (852 F. Supp. 601, 1994)

ORDER & MEMORANDUM

RAINEY, District Judge.

Pending before the Court are Defendant’s Motion for Summary Judgment (Dkt. entry # 11) and Plaintiffs Motion for Summary Judgment (Dkt. # 13).

Having reviewed the parties’ motions, responses, and the applicable law, the Court finds that Plaintiffs Motion for Summary Judgment should be granted and Defendant’s Motion for Summary Judgment should be denied.

Factual Background

In the early 1900’s, the City of Houston was served by motor vehicles called jitneys. In 1924, under pressure from the streetcar companies, the City of Houston enacted Ordinance # 1137-B (the “anti-jitney ordinance” or “ordinance”). The ordinance was passed by a referendum of the voters. The admitted objective of the ordinance was to protect streetcar companies from competition.

The ordinance contains two operative clauses. The first provides that no jitney is allowed to operate on a street that has streetcar tracks. The second provides that no jitney with a seating capacity of less than 15 passengers may be operated on the streets of Houston. Because there are no remaining streetcar tracks in Houston, the first clause is obsolete. However, the second clause has effectively banned all jitney operations in the City of Houston.

Since its inception, the City has granted exceptions to the ordinance when circumstances made it convenient or exigent. In 1949, and again in 1974, the City ignored the ordinance and granted temporary permits to jitney services during transit strikes. Although this allowed jitneys on the streets for only a short time, the City has allowed similar types of transportation services to operate through the years. For a period of time prior to 1983, for example, the City operated a mini-bus system for the transport of passengers inside the central business district for 10 cents a ride. This was a successful operation that had to be discontinued due to problems with the efficiency of the vehicles being used. Since that time, the Metropolitan Transit Authority (“MTA”) has operated a “Shopper’s Special” that is similar in concept to the mini-buses, but limited in its service. There are many van pool and ride share programs in Houston, in addition to the numerous hotel and motel courtesy vans, air transport vans, delivery vans, handicapped vans, and garage parking vans. In 1983, there were over 1500 vans operated by 79 companies in the Houston area, and that number may be much higher today.

From 1983 to 1984, Alfredo Santos operated a jitney service along Westheimer Avenue in the Galleria shopping area and along Harrisburg Street in a predominantly Hispanic area of east Houston. He offered this service using a leased taxicab, charging one ($1.00) dollar for up to five miles along these routes. At this same time, the bus fare for the same distance was approximately fifty-five ($.55) cents and the fare for a five-mile taxi ride was approximately five ($5.00) dollars.

Mr. Santos discontinued the operation of his jitney service after allegedly being threatened with the loss of his license to operate a taxi by a city official. He then filed this lawsuit. In his complaint, Mr. Santos urges the Court to declare the anti-jitney ordinance of 1924 unconstitutional and permanently enjoin the City from enforcing the ordinance. He contends that the ordinance violates the federal anti-trust laws and his substantive due process and/or equal protection rights under the United States and/or Texas Constitutions.

Anti-trust Claim

Plaintiffs anti-trust claim is based on the Sherman Act, 15 U.S.C. § 2, which makes any conduct that tends to “monopolize, or attempt to monopolize ... any part of the trade or commerce among the several states” unlawful.

A. Jurisdiction under the Sherman Act

The Court’s first task is to determine whether jurisdiction exists under the Sherman Act. Defendant directs the Court to U.S. v. Yellow Cab Co., 332 U.S. 218, 67 S.Ct. 1560, 91 L.Ed. 2010 (1947), to support its argument that local transportation services, such as a jitney business, do not “affect interstate commerce;” therefore, acts tending to monopolize such services do not come within the juris