A federal lawsuit that marked the latest salvo in a drawn-out battle between taxi medallion owners and a Minnesota-based lender seemed to fizzle out just days after it was announced. Court documents showed that financial firm O’Brien-Staley Partners/OSK “voluntarily dismissed” its lawsuit in June against the New York Taxi Workers Alliance (NYTWA) within days of filing the case – and just hours after media outlet THE CITY reported on the case.
The two sides had been at odds for months over City Hall’s debt-relief plan for medallion owners, with OSK filing a federal lawsuit on May 24 that accused the 25,000-member union of taxi workers of “nonstop militant action unchecked by the rules that govern everyone else.” The suit threatened to disrupt the firm’s payment plans with individual borrowers, legal documents say.
In court papers filed in June in Brooklyn, the firm abruptly put an end to the case, which sought at least $774,046 in damages. The firm charged that NYTWA sought “to coerce [OSK] into restructuring its entire loan portfolio under the [debt relief] program – even where the individual borrower is currently paying as agreed or has a proven ability to pay.”
In March, OSK accepted an invitation from Senate Majority Leader Chuck Schumer (D-NY) to sign on with the Taxi & Limousine Commission’s (TLC’s) Supplemental Loan Deficiency Guaranty Program, which helps owners struggling with payments. The company also agreed that its servicers would not repossess medallions from owners who keep their loans in good standing with weekly payment plans.
The program, which was spurred by a hunger strike waged by cabbies in October and November, is designed to cap debt-service payments at $1,122 a month with the city guaranteeing the restructured loans. OSK in March said it would participate in the loan program when it becomes operational, but in court papers contended that it is “not fully funded, not fully documented and not operational.”
The TLC said it had so far achieved $50 million of debt forgiveness for close to 300 medallion owners, as of early June – and that it is finalizing the loan guaranty portion of the plan, which would restructure loans up to $200,000 each with a $30,000 grant from the city.
Source: The City