July 24, 2026 NEW YORK, NY In a stunning blow to New York City’s gig workers, a federal court has temporarily halted the enforcement of Local Law 52—a groundbreaking piece of legislation designed to protect rideshare drivers from sudden and unfair account deactivations.

The preliminary injunction, handed down by Judge Woods, delivers a massive initial victory to tech giant Uber as the broader lawsuit proceeds through the courts.

The Core of the Decision: Safety Over "Narrow" Driver Interests

Judge Woods ruled that the balance of public interest and potential harm heavily favors Uber. At the center of his reasoning was a controversial assessment: the number of drivers affected by wrongful deactivations is simply too small to justify the law's sweeping restrictions on private contracts.

"The record documents hardships that wrongful deactivation imposes on drivers but does not estimate how many deactivations were wrongful," Woods wrote. "The record does not establish that the group likely to require its protections is large in the context of the public served by the City Council."

The court agreed with Uber and Lyft’s argument that Local Law 52 likely violates the U.S. Constitution’s Contracts Clause, unfairly stripping tech platforms of their authority to investigate and discipline drivers engaged in:

• Deceptive or fraudulent behavior

• Unsafe or illegal actions

• Harmful conduct on the platform

The Safety Timeline Loophole

While Local Law 52 still allowed platforms to deactivate drivers who pose immediate dangers, Judge Woods took severe issue with a mandatory five-day rule. The law required rideshare companies to deliver detailed documentation explaining temporary deactivations within five days of a passenger complaint.

Woods highlighted a potentially dangerous loophole: if a company failed to meet the strict five-day deadline while investigating a severe complaint—such as a sexual assault claim—a dangerous driver could be forced back onto the road purely due to a "procedural defect." In the court's view, the public safety risks created by this strict timeline far outweighed the harm done to what Woods characterized as "a very small but undetermined number of drivers."

Outrage from Labor Advocates and City Leaders

The ruling sent shockwaves through New York City's labor advocate community, igniting fiery responses from city officials and union leaders alike.

"A Punch in the Gut to Workers"

Bhairavi Desai, Executive Director of the New York Taxi Workers Alliance (NYTWA), issued a scathing rebuke of the judge's logic regarding driver population sizes:

"It’s an extreme, pro-corporation position that would be a danger to the rights of every working person if it were allowed to stand. The decision is a punch in the gut to New York City workers and a slap in the face of democracy, endangering the city’s ability to enact any workforce-specific regulations."

Lawmaker Vows to Fight On

Queens City Council Member Shekar Krishnan (D-Queens), the primary sponsor behind Local Law 52, expressed deep disappointment with the injunction but made it clear the battle is far from over.

Krishnan reaffirmed his commitment to ensuring gig workers receive fundamental due process, stating that city legal teams are actively evaluating the ruling and plotting their next moves to defend the law in court.

What’s Next in the Legal War?

Uber original complaint—filed in June—argues that Local Law 52 breaches the Contracts Clause, the Due Process Clause, and the First Amendment.

With Judge Woods ruling that Uber and Lyft are ultimately likely to prevail on the merits of their argument, the temporary block remains in place. As the lawsuit moves forward, thousands of New York City drivers are left waiting in limbo, watching to see whether the city can salvage its ambitious driver-protection agenda.

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