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MONTREAL — Quebec cab drivers have been given the green light to sue the provincial government, alleging it stood by as Uber moved into their market.

A lawyer for the taxi drivers said if they win their claim, it could cost the government $1 billion to compensate drivers for lost revenues and a drop in the value of their taxi permits.

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“It is a significant loss of value, and it must be compensated,” Marc-Antoine Cloutier said after Quebec Superior Justice Mark Peacock ruled Wednesday that the drivers’ case can proceed and be heard on its merits.

Drivers have accused the government of inaction as Uber’s ride-hailing service moved into the province without being subjected to the rules imposed on taxis.

They argue a government-sanctioned pilot project with Uber that began in October 2016 has further devalued their costly permits.

“At the heart of this case is the question of why, if two groups are carrying out the same commercial activities, the government treats one group differently than the other,” Peacock wrote in a 46-page decision. “Based on the premise posed by (the applicant), an inference is possible that this differential treatment may be caused by bad faith.”