If the medallion is the only way you can be a taxi, then enforce it. If Lyft and Uber are legitimate, then lose the medallion and pay this guy back his $250K.
Yes, there is little difference between street hailing and dispatch these days. But the law never guaranteed them immunity from dispatch innovation.
No one was scammed. But you can still feel sorry for the guy.
If there is one thing to learn - DIVERSIFY YOUR INVESTMENTS!
How do you diversity your investment in your employer?