Chicago Parking Meters hit with potential class-action suit for ‘unreasonable 75-year monopoly’
The complaint, filed Wednesday in federal court in Chicago, says the deal with the city has brought increased parking rates and restrictions on other forms of travel.
A potential class action lawsuit filed this week against the private company that operates Chicago’s sprawling parking meter system alleges its exclusive contract with the city amounts to an “unreasonable 75-year monopoly.”
The complaint, filed Wednesday in federal court in Chicago, holds that Chicago Parking Meters’ lengthy deal with the city has resulted in increased parking rates and restrictions on other forms of travel, like bicycles and ride-hailing.
“The City of Chicago granted CPM, a private party, monopoly control over the City’s parking meter system for an astonishing 75-year-long period, without regard for the changes in technology and innovations in transportation taking place now and for the rest of the century, without regard for the rapidly changing consumer needs and preferences for different types of transportation, and without regard for changes in transportation resulting from climate change and the imperative need to reduce greenhouse gas emissions,” the suit claims.
Three drivers aligned with the Democratic Socialists of America brought the suit, which seeks class action status on behalf of other motorists who have paid to use the ParkChicago machines operated by CPM, a Delaware-based venture that counts Morgan Stanley, Allianz Capital Partners and the Abu Dhabi Investment Authority as its backers.
CPM didn’t respond to a request for comment. Neither did an attorney for the plaintiffs.
In 2008, the City Council approved former Mayor Richard M. Daley’s proposal to lease the meter system to CPM for 75 years. The following year, the city transferred control of 36,000 meters to the company in exchange for $1.16 billion.
Though many Chicago drivers maligned the deal, the city entered into an amended agreement in 2013 under then-Mayor Rahm Emanuel. That agreement offered free parking in neighborhoods on Sundays, allowed drivers to pay with their cellphones and revised meter times in some areas.
On its website, CPM touts some of those changes and claims its parking system is the nation’s third largest.
The suit, however, claims the “rates for parking have more than doubled” under CPM. In 2008, prior to the start of the contract, the city was collecting just under $24 million in annual parking meter rates. But in 2019, the company collected nearly $139 million in annual meter rates, according to the lawsuit.
By the end of that year, the suit claims the firm had already made $500 million more than its initial $1.16 billon investment.
The lawsuit holds that CPM’s agreement bars the city from regulating the firm’s parking rates and prevents bidding with competitors that “could provide the same services for a smaller number of meters and in a manner that is environmentally safe and consistent with consumer needs and preferences.” The agreement also allegedly placed “special restrictions” on other forms of transportation, like bikes, ride-hailing, public transit “and the onset of driverless cars.”
The suit claims the deal with the city violates both federal antitrust laws and the Illinois Consumer Fraud and Deceptive Business Practices Act. The initial filing seeks class action status, unspecified monetary damages, the payment of legal fees and other relief.