updated 9/28/2007 3:32:27 PM ET 2007-09-28T19:32:27

A federal judge refused Friday to block a new city rule that requires taxi drivers to install global positioning systems and credit card machines in their cabs by Monday.

The drivers argue that the city overstepped its authority and acted unconstitutionally when it mandated the units. Their lawsuit also claims GPS will give away trade secrets by disclosing the cabbies' driving patterns, which they say give them a competitive edge.

U.S. District Judge Richard M. Berman refused to block the rule from taking effect, saying the use of the technology to improve taxi service appeared to outweigh drivers' privacy rights. He urged the two sides to negotiate and set the next hearing for Oct. 10.

Malcolm Goldstein, a lawyer for the taxi drivers, said the case is among the first to confront GPS issues.

"The record has to be developed yet. We're saying GPS is remarkably intrusive, more intrusive than anything before. It's our burden to persuade him," Goldstein said.

Michael Cardozo, the head of the city's law office, called the decision a "satisfying legal victory — and a victory for all taxi passengers who will enjoy the benefits of these service improvements."

Taxi and Limousine Commissioner Matthew W. Daus said he hoped the ruling "allows us to continue to advance and progress without distraction or delay."

Berman said that on the limited amount of evidence he had viewed so far, it did not appear the drivers would succeed in claims that the city acted improperly, caused them "severe and debilitating economic harm" and prevented them from earning their livelihood.

At an earlier hearing on Wednesday, Berman had expressed skepticism toward the drivers' arguments, saying, "It's not a Mona Lisa painting. It's a car."

After that hearing, dejected driver Beres Ford Simmons said: "Gentlemen, prepare for another strike."

Hundreds of drivers idled their cabs for a two-day protest of the GPS technology in early September. More than 13,000 yellow cabs must be equipped with GPS and software that record where the cars are every eight seconds or the drivers could face fines. The group leading that strike called it a "resounding success," while city officials said disruption was minimal.

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