In a statement Monday, the Vancouver Taxi Association said the lawsuit, which was launched last November, is no longer necessary "as Uber has since stated it is not operating in the city."
The association represents Black Top & Checker Cabs, Yellow Cabs, MacLure's Cabs and Vancouver Taxi and said if Uber does try to operate in Vancouver it will refile the lawsuit.
"We hope that will not be necessary and that if Uber decides to operate in the city, it will do so in compliance with the legal requirements," said the association.
Uber's smart phone app allows non-regulated drivers to pick up fares in their own personal vehicles, and already operates in more than 200 cities worldwide.
Uber calls lawsuit 'without merit'
Uber responded Monday by saying the taxi association's arguments were "without merit."
"Vancouver and British Columbia need 21st century regulation and business models, and we're proud to be advocates for change," said spokesman Xavier Van Chau in a statement.
"We're still eager to find our way back to Vancouver!" wrote Chau.
City moratorium in place
The app company has more hurdles than the lawsuit to make that happen, however.
Last fall, when Uber appeared to be entering the Vancouver market, the B.C. government announced plainclothes enforcement officers would pose as customers to bust anyone providing a "taxi-like service" without a license.
In October, the city of Vancouver also put a six-month moratorium on new taxi licenses to review the impact of changes including "ride sharing" technologies like Uber's app.
Uber is participating in that review and currently hiring for a public policy manager based in Vancouver, whose job it would be to "develop strategies for keeping markets open, and opening new ones."
The city is considering extending its moratorium and review until October 31, 2015.