Hagler invalidated the new city rule that would require taxi companies and drivers to begin buying only the Nissan NV200 van, starting late this month.
Nissan beat out Ford Motor Co. and a Turkish vehicle maker two years ago to win the multi-year, exclusive deal as part of Mayor Michael Bloomberg's "Taxi of Tomorrow" concept.
Bloomberg wanted a fleet of thousands of identical, purpose-built taxis serving New York to showcase the city to millions of tourists a year.
Nissan has hailed the New York contract as the cornerstone of a plan to market high-profile taxis to cities around the world, based on its presence in New York.
The ruling stems from a lawsuit filed against the New York City Taxi and Limousine Commission in August by the Greater New York Taxi Association, a local advocacy group representing cab companies, drivers and dispatchers.
The judge said the taxi commission did not have "the authority to contract with a third party vendor to manufacture a vehicle that would be the exclusive taxi for the City of New York for the next ten years and medallion owners will be mandated to purchase."
A statement issued this afternoon by Nissan indicated it will move ahead with plans to launch taxi sales in New York.
"We are disappointed in the court's decision, but it will not prevent our plan to start upgrading the NYC taxi fleet with the Nissan Taxi of Tomorrow at the end of the month," the company said in a statement.
The unusual arrangement has been assailed both by city officials and the court.
Some cab companies balked at the deal, complaining that with a manufacturer's list price of $29,700, the vehicle would be too expensive for some cab companies. Others complained that the city's contract with Nissan, officially signed in October 2012, failed to meet New York's own pre-condition that the taxi be available as a hybrid.
A separate court ruling earlier this year declared that because Nissan's NV200 taxi does not yet come as a hybrid vehicle, buyers will be able to opt for non-Nissan taxis until a hybrid NV200 is available.
But the latest court decision appears to deflate Nissan's entire contract.
"We are evaluating options for next steps regarding the exclusivity contract," Nissan added in its statement.
The NV200 taxi was designed from the ground up to appeal to cab operators and passengers. Among its features are ample seating, a see-through roof to let tourists watch the skyline as they move through the city and rear-seat phone chargers. An electric version of the NV200 taxi is also planned.
The company's statement today asserted that cab drivers will still want the NV200, even without an exclusive requirement to purchase it.
"Given the specific NYC taxi research and development that we have conducted," the automaker said, "we are confident that the Nissan taxi provides optimal safety, comfort and convenience for passengers and drivers alike."