A 2023 Pennsylvania state law gave the Philadelphia Parking Authority an unconstitutional monopoly on the abandoned vehicle towing industry, local towing companies claim in a new federal lawsuit.

The 10 companies claim that a law signed by Governor Josh Shapiro in December disrupted more than two decades of business relations they had in Philadelphia. This interference with contracts is prohibited by the Pennsylvania and United States constitutions, the lawsuit claims.

The Philadelphia Independent Towers and Salvors Association and towing companies filed a lawsuit against the PPA, ShapiroAnd Attorney General of Pennsylvania Michelle Henry on October 29 in the Eastern District of Pennsylvania.

The PPA and Henry’s office declined to comment. Lawyers representing the towing companies and Shapiro’s office did not respond to requests for comment.

Private towing companies had contracted with the city to remove abandoned vehicles since 2000, the complaint states. Businesses would receive abandoned vehicle report the Philadelphia Police Department’s Neighborhood Services Unit and tow the car to a warehouse.

Between 2022 and 2023, the 10 companies represented in the lawsuit towed approximately 13,000 abandoned cars, according to the complaint. (Not to be confused with “courtesy towing» in which the PPA moves a legally parked car because parking is temporarily prohibited, for example before an event.)

“Plaintiffs rely on these contracts as their primary source of revenue because they do not provide private towing services but serve the City of Philadelphia for years cleaning the streets,” the lawsuit states.

Things changed in the second half of 2023, when PPA allegedly began towing abandoned cars, which the lawsuit alleges was done without permission. And at the end of the year, state lawmakers included language in an omnibus bill that made the PPA “a designated municipal agency and authorized rescuer” of abandoned cars in Philadelphia.

“The law clearly states that only PPA may tow abandoned vehicles within the city limits of Philadelphia,” the complaint states. “This constitutes a violation of Plaintiffs’ long-standing and recently extended contract with the City of Philadelphia and is unconstitutional on its face.”

In September, Philadelphia extended the contract with towing companies until November 2025. It requires the companies to store, return or dispose of abandoned vehicles throughout the city.

But towing companies say they’ve had to lay off staff, making it difficult to meet other elements of their contract with the city. The lawsuit argues that by “conferring the obligations of contracts,” the law is unconstitutional.

The companies filing the suit are: K&A Salvage Auto Salvage Inc, Morton Towing & Recovery, Delaware Valley Towing & Auto Parts, Steffa Metals Co. Inc., Above All Salvage Inc., Orthodox Auto Group, Freddie’s Auto Parts Inc., Jim’s. Auto Recycling Inc., Jamison’s Towing Service and Philadelphia Towing and Transport.

They are demanding that a federal judge declare the law null and void, order PPA to stop towing abandoned vehicles in Philadelphia and compensate the companies for revenue they have lost since the law was enacted.