There was a temporary order halting the use of the e-hail apps, which the judge lifted on Tuesday.
The New York City Taxi and Limousine Commission agreed in December to test the idea for a year.
Livery cab owners sued, claiming that the program would violate a law that prohibits cab drivers from refusing passengers without justifiable grounds.
The judge says the e-hail plan might actually combat any discrimination in picking passengers, since drivers won’t be able to see their fares when accepting them.
The livery owners also argued that the virtual hail apps violate a law that prevents yellow cab drivers from setting up prearranged rides with passengers.
TLC Commissioner David Yassky calls the decision a victory for riders’ choice.
A lawyer for the livery cab owners, Randy Mastro, said they were considering an appeal.
“This decision is so fundamentally wrong in so many respects,” Mastro told the Associated Press by phone, declining to elaborate.
The Taxi and Limousine Commission agreed in December to test the idea for a year, saying the city couldn’t ignore evolving taxi technology. E-hail systems are in use in some other cities, and at least a dozen companies said they were ready to provide the service in New York.
Using an app, a potential passenger requests a ride, all participating cabbies within a certain distance get the inquiry, and the driver who responds first gets the fare.
Car-service owners said it unfairly blurred a legal line between yellow and livery cabs, which are barred from picking up passengers on streets and so depend on prearranged rides.
Meanwhile, the state’s highest court, the Court of Appeals, was poised to hear arguments Wednesday over a nearly opposite initiative: A plan to let livery cabs pick up passengers on streets in upper Manhattan and the city’s four other boroughs.
In that case, yellow cab owners sued. They said the plan would hurt their business; Mayor Michael Bloomberg has countered that it would make travel safer, easier and cheaper for millions of people.
The outcome could have a major impact on the city’s budget, as the disputed measure is coupled with a proposal to sell 2,000 new yellow-cab permits, or medallions. Officials have estimated that could make the city more than $1.4 billion over several years.
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