Nnebe v. Daus Stallworth v. Joshi , 931 F.3d 66 ( 2019 )

18-866-cv (L); 18-490-cv
Nnebe v. Daus; Stallworth v. Joshi
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term, 2018
(Argued: January 14, 2019 Decided: July 19, 2019)
Docket Nos. 18-866-cv (L); 18-1254-cv (XAP); 18-490-cv
JONATHAN NNEBE, KHAIRUL AMIN, EDUARDO AVENAUT, NEW YORK TAXI WORKERS
ALLIANCE, individually and on behalf of all others similarly situated,
Plaintiffs - Appellants - Cross-Appellees,
ALEXANDER KARMANSKY, individually and on behalf of all others similarly
situated,
Plaintiff,
— v. —
MATTHEW DAUS, JOSEPH ECKSTEIN, ELIZABETH BONINA, THE NEW YORK CITY TAXI
AND LIMOUSINE COMMISSION, THE CITY OF NEW YORK, CHARLES FRASER,
Defendants - Appellees - Cross-Appellants,
CHARLES FRAZIER,
Defendant.*
*
The Clerk of Court is requested to amend the caption to conform to the above.
ANTHONY STALLWORTH, PARICHAY BARMAN, NOOR TANI, THE NEW YORK TAXI
WORKERS ALLIANCE, individually and on behalf of all others similarly situated,
Plaintiffs - Appellants,
v.
MEERA JOSHI, CHRIS WILSON, STAS SKARBO, THE CITY OF NEW YORK,
Defendants - Appellees.
B e f o r e:
KATZMANN, Chief Judge, and HALL and LYNCH, Circuit Judges.
The Nnebe plaintiffs are taxi drivers who instituted this action under 42
U.S.C. § 1983, complaining that their constitutional rights were violated when
their licenses were suspended following their arrests and they were not given
meaningful post-suspension hearings to consider whether their licenses should
be reinstated. They appeal following a bench trial in the United States District
Court for the Southern District of New York (Richard J. Sullivan, Judge), after
which the court held that the hearings provided by defendants were sufficient.
Because the drivers’ property interest in their licenses is substantial, the risk of
erroneous deprivation is unacceptably high, and defendants could institute a
more meaningful process at minimal financial and administrative cost, we
conclude that the hearings did not afford plaintiffs adequate process. We
therefore AFFIRM in part and REVERSE in part the judgment of the district court
and REMAND for further proceedings.
The Stallworth plaintiffs are also taxi drivers who instituted a similar action
challenging the same regulatory regime. The district court dismissed their
complaint for failure to state a claim in reliance on its Nnebe ruling. Because we
find that that ruling was incorrect, we AFFIRM in part and REVERSE in part the
judgment of the district court and REMAND for further proceedings.
2
DANIEL L. ACKMAN, Law Office of Daniel L. Ackman, New
York, New York, DAVID T. GOLDBERG, Donahue & Goldberg,
LLP, New York, New York, for Plaintiffs - Appellants - Cross-
Appellees in Nnebe, and Daniel L. Ackman, Law Office Of
Daniel L. Ackman, New York, New York for Plaintiffs -
Appellants in Stallworth.
CLAUDE S. PLATTON, Assistant Corporation Counsel (Richard
Dearing, Susan Paulson, on the brief), for Zachary W. Carter,
Corporation Counsel, New York, New York, for Defendants -
Appellees - Cross-Appellants in Nnebe, and Zachary W. Carter,
Corporation Counsel, Claude S. Patton, Susan Paulson, and
Scott Shorr, New York, New York, for Defendants - Appellees in
Stallworth.
Runa Rajagopal, The Bronx Defenders, Bronx, New York, for
amici curiae The Bronx Defenders, Community Service Society
of New York, Legal Action Center, Neighborhood Defender
Service of Harlem, Youth Represent, Urban Justice Center
Mental Health Project, Brooklyn Defender Services, Legal Aid
Society, and LatinoJustice PRLDEF.
GERARD E. LYNCH, Circuit Judge:
The Taxi and Limousine Commission of New York City (the “TLC”) has
the authority to issue, revoke, and suspend taxi drivers’ licenses. These tandem
cases require us to examine the TLC’s suspension procedures under the Due
Process Clause to determine whether the TLC provides meaningful hearings to
3
drivers whose licenses have been suspended pending the outcome of criminal
proceedings. We conclude that it does not.
We first determine that evidence of a driver’s ongoing danger to health
and public safety is relevant under the statutory and regulatory scheme. We then
conclude that, in light of the significant private interest at stake, the unacceptably
high risk of erroneous deprivation, and the fact that additional safeguards can be
provided with minimal burden on governmental resources, the TLC’s refusal to
consider such evidence violates due process.
Accordingly, in Nnebe we AFFIRM in part and REVERSE in part the
judgment of the district court, we AFFIRM in part and REVERSE in part the
judgment in Stallworth, and we REMAND both cases to the district court for
further proceedings.
BACKGROUND
This appeal concerns what happens when taxi drivers are arrested on
criminal charges and their licenses are summarily suspended. Though arrested
drivers are entitled under the relevant regulation to a post-suspension hearing,
the plaintiffs contend that the hearings the TLC provides are meaningless, and
that no driver has ever had his or her license reinstated following such a hearing.
4
They bring claims that sound in procedural due process, arguing that the post-
suspension hearings are not the “meaningful” hearings that due process requires.
See Mathews v. Eldridge, 424 U.S. 319, 333 (1976) (citation omitted).
In the first of the tandem cases, Nnebe v. Daus, plaintiffs-appellants-cross-
appellees are drivers whose licenses were suspended before 2007. They first
brought this action under 42 U.S.C. § 1983 in 2006; it has since wound its way
through a complex procedural web which culminated in a bench trial, from the
results of which plaintiffs now appeal (No. 18-866-cv). The defendants in that
case ¯ the TLC, the City of New York, and various employees of those entities ¯
cross-appeal the single issue on which the district court found in plaintiffs’ favor:
that the notice given to suspended drivers prior to December 2006 was
constitutionally infirm (No. 18-1254-cv).
In the second case, Stallworth v. Joshi, the plaintiffs-appellants are drivers
suspended in 2017 after being arrested for leaving the scene of an accident.
Defendants ¯ the City of New York, and various City and TLC employees ¯
moved to dismiss the case for failure to state a claim in light of the district court’s
rulings in Nnebe. The district court granted the motion; plaintiffs appeal (No. 18-
490-cv).
5
I. The TLC Regulatory Regime
The New York City Charter grants broad authority to the TLC to
promulgate and implement a regulatory program for the taxi industry. See N.Y.C.
Charter § 2303(b)(5) (granting the TLC, inter alia, the power to issue, revoke, and
suspend licenses). New York City Administrative Code § 19-512.1(a) (the
“Ordinance”) governs the revocation of taxicab licenses and reads as follows:
“The commission . . . may, for good cause shown relating to a direct and
substantial threat to the public health or safety and prior to giving notice and an
opportunity for a hearing, suspend a taxicab . . . license . . . .” The Ordinance
further requires notice to be given within five calendar days of any such
suspension, and “an opportunity to request a hearing . . . within ten calendar
days” of such notification. Id. In passing the Ordinance, the City Council noted
“the strong need for aggressive regulation of the taxicab . . . industry and those
directly responsible for the safety of the riding public” but found that certain TLC
rules modifying disciplinary measures against drivers were overly “onerous.” Id.
n.1. The Council determined that the new ordinance, with its requirements of
good cause related to a direct and substantial threat to public safety and of a
prompt hearing process, “establishes a superior balancing of the concern for safe
6
and high quality service with the need for fair treatment of an industry important
to New York City.” Id.
Under this authority, the TLC has promulgated a number of regulations
over the years dealing with arrest-related license suspensions and revocations. In
1999, the first version of the Rule, 35 R.C.N.Y. § 8-16(a) (1999), allowed the TLC
Chairperson to order a summary suspension of a license, pending revocation
proceedings, if he or she “finds that emergency action is required to insure public
health, safety or welfare.” The 1999 Rule further required notification of the
summary suspension within five days, and an opportunity to request a prompt
post-deprivation hearing before an administrative law judge (“ALJ”) “who shall
consider relevant evidence and testimony” under oath. Id. §8-16(c),(d). The ALJ
was then required to issue a written recommendation to the TLC Chair, who
could “accept, reject or modify the recommendation.” Id §8-16(e).
In 2006, the Rule was amended; notably, the amended Rule specified that
the TLC Chair could summarily suspend a license “based upon an arrest on
criminal charges that the Chairperson determines is relevant to the licensee’s
qualifications for continued licensure.” R.C.N.Y. § 8-16 (c) (2006). It then laid out
the issue to be determined at the hearing: “whether the charges underlying the
7
licensee’s arrest, if true, demonstrate that the licensee’s continued licensure
during the pendency of the criminal charges would pose a threat to the health or
safety of the public.” Id. The TLC Chair retained the authority to accept, reject, or
modify the finding of the ALJ. Id. §8-16(f).
The most recent version of the Rule, as amended in 2014, provides as
follows: “The Chairperson can summarily suspend a License based upon an
arrest or citation if the Chairperson believes that the charges, if true, would
demonstrate that continued licensure would constitute a direct and substantial
threat to public health or safety.” R.C.N.Y. § 68-15(d)(1). The Rule then proceeds
to state that all felonies and certain enumerated misdemeanors will trigger a
summary suspension. Id. This latest version of the Rule provides for a hearing at
which the issue to be determined is “whether the charges underlying the
Licensee’s arrest, if true, demonstrate that the continuation of the License while
awaiting a decision on the criminal charges would pose a direct and substantial
threat to public health or safety.” Id. § 68-15(d)(3).1
1
The Rule was also modestly amended in 2008 and 2011.
8
II. Summary Suspension Process2
While the text of the Rule has gone through several iterations, in practice
the summary suspension process has been essentially the same since its adoption.
As the district court pointed out, “[e]ven the most significant change to the Rule
¯ the addition of the substantive standard in 2006 ¯ merely reflected and
restated pre-existing practice.” J. App’x 65.3
A. The Initial Suspension Process
When a licensed taxi driver is arrested, the New York Division of Criminal
Justice Services (“DCJS”) sends the TLC an arrest notification. A TLC employee
then confirms that the arrested person is in fact a licensed TLC driver and checks
the charged offense against a list of offenses that the TLC considers sufficiently
2
The facts set forth in this Section are taken from the findings of fact made by the
district court after trial, none of which are challenged on appeal.
3
“J. App’x” refers to the Nnebe Joint Appendix.
9
serious to warrant suspension.4 The listed offenses include all felonies, and
misdemeanors involving violence, driving, or sexual misconduct.5
The TLC then notifies the driver in a letter that it has learned of his or her
arrest, that the driver’s license has been suspended, and that the driver can
schedule a hearing to contest the suspension. The driver is not informed of any
standard that will be applied at the hearing, but the letter does direct the driver
to the version of the Rule in force at time of the letter’s issuance. The letter also
makes clear that the TLC may lift the suspension if the charges are resolved in the
driver’s favor, and that the driver should inform the TLC of any developments in
the criminal case.
Approximately nine out of ten suspended drivers initially request a
hearing. Seventy-five percent of suspended drivers eventually have their
suspensions lifted by virtue of a favorable disposition of their cases ¯ such as the
4
This list of offenses was not made public until the 2014 amendment, which
enumerated the offenses for which an initial summary suspension was automatic.
5
On a few isolated occasions, the TLC has summarily suspended a driver for a
misdemeanor that, while not listed, was deemed sufficiently serious to warrant
suspension. See TLC v. Nahamov, OATH Index No. 1796/12 (June 4, 2012)
(reviewing a suspension for promoting prostitution in the fourth degree).
10
charges against them being dismissed, reduced to an offense that is not on the
list, or otherwise resolved in their favor. A driver can notify the TLC of a change
in the status of his or her criminal case at any time, including after the hearing
and review process has taken place. If the criminal case is resolved without a
conviction, the TLC does not inquire into the reasons for the favorable
disposition, but automatically lifts the suspension.
B. The Summary Suspension Review Process
After a driver requests a hearing, the TLC notifies the driver by letter of the
time, date, and location of the hearing, and informs the driver that he or she can
present evidence and call witnesses. The letter informs the driver that “the
purpose of th[e] hearing will be to determine whether your TLC license should
remain suspended pending the final disposition of your criminal case.” J. App’x
67.
The review process itself consists of two parts: the first is a hearing before
an ALJ at which the driver and a TLC attorney appear and present evidence; the
second is a review of the ALJ’s recommendation by the TLC Chair. Two different
administrative bodies have presided over the summary suspension hearings.
While there were some differences in procedure, under neither regime has the
11
TLC Chair ever recommended reinstating a driver’s license. We consider each in
turn.
1. Hearings before TLC ALJs
Prior to November 2007, the ALJs presiding at summary suspension
hearings were TLC employees. The TLC ALJs were instructed not to consider any
specific facts and circumstances about either the drivers or the individual crimes
with which they were charged. Rather, they were directed to address only three
issues: (1) whether the suspended driver had in fact been charged with a crime;
(2) whether the charge was still pending; and (3) whether the crime with which
the driver was charged had a “nexus” to public health or safety. J. App’x 67. The
first two were factual questions,6 but the nexus question “was a ‘philosophical’
question and was decided based on argument, not facts.” Id. However, the ALJs
did not direct drivers to the “philosophical” nexus standard, and “most, if not all,
suspended drivers did not understand what the standard was.” J. App’x 68.
Instead, the ALJs “encouraged drivers to argue anything they wanted ¯
6
The TLC most often met its burden on the first two issues by providing a DCJS
arrest notification, a printout from the TLC database showing that the suspended
driver was the same person identified in the arrest notification, and a copy of the
penal statute defining the charged crime. Occasionally, it provided a copy of the
criminal complaint.
12
including that they were not a threat to health or public safety or that they were
innocent ¯ so that those arguments could be included in the record.” Id.
Although the drivers were allowed to present evidence and call witnesses on
these subjects, the TLC ALJs did not consider drivers’ particularized arguments
that their licensure did not pose a threat to the public safety.
The hearings under the TLC ALJs “resulted in a nearly unbroken record of
recommendations that the suspension be continued.” J. App’x 68. In only three
cases out of hundreds of hearings was a contrary recommendation made. A
single ALJ, Eric Gottlieb, was responsible for all three. He was promptly
reprimanded by his supervisor, and subsequently took care not to make another
such recommendation for fear that he would be transferred to a less desirable
work location. See Nnebe v. Daus, 644 F.3d 147, 152S53 (2d Cir. 2011) (“Nnebe II”).
Gottlieb testified that, after being admonished, he recommended continued
suspension in all cases. As Gottlieb stated, “[s]o long as the person before me
was, in fact, arrested, he would remain on suspension, absolutely.” J. App’x 306.
2. Hearings before OATH ALJs
Starting in November 2007, the hearings were presided over by ALJs
employed by the City’s Office of Administrative Trials and Hearings (“OATH”).
13
The process under the OATH ALJs was largely the same as before the TLC ALJs,
but the standard applied was different. At an OATH hearing, the ALJs were
directed to consider “whether the particular suspended driver is, in fact, a direct
and substantial threat to public health or safety.” J. App’x 68 (emphases added).
Under this regime, an ALJ was more likely to recommend lifting a driver’s
suspension, though the absolute number of such recommendations was still low.7
3. TLC Chairperson Review
Under both regimes, the TLC Chairperson makes the ultimate decision
about whether to lift a summary suspension. After the hearing, the TLC sends a
copy of the ALJ’s recommendation to the driver, and notifies the driver that he or
she may submit a written response to the recommendation. The written response,
however, may not incorporate any evidence outside of the hearing record, and
the notice does not inform the driver of the standard the Chair will apply.
7
As the district court found, “[t]here have been six recommendations to lift
suspensions ... out of [a] few dozen hearings.” J. App’x 69. This is in contrast to
the hundreds of hearings held by the TLC ALJs, a drop due primarily to the
presence of “pre-hearing conferences” at which an OATH ALJ meets with the
driver and a lawyer for the TLC. At these conferences, the OATH ALJ typically
discourages the driver from proceeding to the hearing, advising him or her “that
there is ‘little or no chance’ that the driver will ultimately prevail.” J. App’x 69.
Following the conference, most drivers decide to waive or postpone their
hearings.
14
Throughout the period at issue, regardless of the affiliation of the ALJ, the
Chair, like the TLC ALJs, considered only: (1) whether a suspended driver has in
fact been charged with a crime; (2) whether that charge is still pending; and (3)
whether there is a nexus between the charged crime, considered in the abstract,
and public health and safety. The Chair can consider evidence relating to the first
two inquiries, including the criminal complaint or other charging documents, but
the Chair’s determination as to whether there is a “nexus” is a “‘common sense’
determination ‘based on the nature of the pending charges.’” J. App’x 70 (citation
omitted). The Chair does not consider the specific factual allegations in the
complaint, nor does he or she consider any evidence that the driver is not guilty
of the charges, or any other evidence that a particular driver does not pose a
direct and substantial threat to public safety based on his or her individual
characteristics or history.8 Under neither hearing regime has the TLC Chair ever
lifted a suspension.
8
At trial, two witnesses testified that the Chair engaged in a more holistic inquiry
into the individual circumstances underlying a driver’s arrest. The district court,
however, credited neither witness’s testimony, finding that one witness had
“little memory of his actual experience reviewing summary suspension hearings,
and what memory he did have was contradicted by the documentary record,”
J. App’x 71, and that the testimony of the other witness, a former TLC Chair’s
designee, “flatly contradict[ed]” the official decisions that she herself had written,
J. App’x 72.
15
III. Procedural History
A. Nnebe
The Nnebe plaintiffs ¯ Jonathan Nnebe, Eduardo Avenaut, and Khairul
Amin, and the New York Taxi Workers Alliance9 ¯ filed suit against officials of
the TLC and employees of the City of New York in June 2006, challenging the
TLC’s summary suspension procedures under the Due Process Clause of the
Fourteenth Amendment. They sought certification of a class action, declaratory
and injunctive relief, compensatory and punitive damages, and attorney’s fees.
Each of the named plaintiffs was a driver whose license had been suspended
after an arrest for assault in the third degree and was restored several months
later after the charges against him were either dismissed or adjourned in
contemplation of dismissal.10
9
An additional plaintiff, Alexander Karmansky, was listed in the original
complaint. He died in 2014 and is not a party to this appeal.
10
According to the complaint, Nnebe was arrested on May 29, 2006,
given a Desk Appearance Ticket (“DAT”), and released. He requested a hearing,
which was held before a TLC ALJ on June 8, 2006; the ALJ recommended
continued suspension. On July 3, 2006, the Chair accepted the ALJ’s
recommendation. Nnebe’s license continued suspended for at least four months,
at which point the criminal charges were dismissed for failure to prosecute.
Avenaut was arrested on July 17, 2006, for an alleged domestic dispute with his
girlfriend, who subsequently recanted her accusation. His license was suspended
on July 20, 2006, and reinstated on October 24, 2006, when his case was dismissed
16
1. Summary Judgment Motion
In 2009, the district court granted summary judgment to the defendants.
Nnebe v. Daus, 665 F. Supp. 2d 311 (S.D.N.Y. 2009) (“Nnebe I”). The district court
considered both the lack of a pre-deprivation hearing and the meaningfulness of
the post-deprivation hearing under the familiar Mathews framework, first finding
no constitutional deprivation in the lack of a pre-deprivation hearing despite the
“undoubtedly significant” private interest at stake, noting that “the deprivation
of a protected interest is mitigated by the availability of prompt post-deprivation
review.” Nnebe I, 665 F. Supp. 2d at 324.
The court also found that the post-deprivation hearings did not deprive the
plaintiffs of procedural due process, basing its conclusion primarily on its
concern that a “full adversarial hearing” as to plaintiffs’ guilt or innocence
“would be unworkable,” and “would present the significant possibility of
interference with the criminal investigation and proceedings.” Id. at 328. The
for failure to prosecute. Amin was arrested on June 11, 2005, and his license was
suspended on June 14, 2005. At his hearing the ALJ recommended continued
suspension and the TLC Chair so ruled. His criminal case was adjourned in
contemplation of dismissal on August 24, 2005, and the charges were formally
dismissed on February 23, 2006. His license was suspended for ten weeks.
17
court also concluded that “additional safeguards . . . would present a significant
financial and administrative burden on the TLC.” Id.
The court then held that the plaintiffs’ substantive due process claims
lacked merit, concluding “that [d]efendants’ actions were not so outrageously
arbitrary as to rise to the level of a substantive due process violation.”11 Id. at 331
(internal quotation marks omitted). Finally, the court held that there was no merit
to plaintiffs’ claims that the summary suspensions were “unconstitutional
because drivers lack notice that they will be suspended after they are arrested for
specified crimes.”12 Id. at 332.
2. 2011 Appeal
The Nnebe plaintiffs appealed to this court. We affirmed in part, agreeing
that procedural due process did not require a pre-deprivation hearing, and
vacated and remanded in part, holding that we could not “determine whether
the post-deprivation hearing affords due process because we find that the record
on summary judgment does not support the district court’s finding (and the
11
Plaintiffs then contended, and continue to contend, that they did not intend to
raise any substantive due process claims. See Nnebe II, 644 F.3d at 153S54 n.2.
12
The court’s summary judgment opinion also addressed several other issues not
relevant to this appeal.
18
City’s claim) that the hearing enables a driver to make a showing that ‘the
charges, even if true, do not demonstrate that the licensee’s continued licensure
would pose a threat to public health or safety.’” Nnebe II, 644 F.3d at 150 (quoting
Nnebe I, 665 F. Supp. 2d at 318) (internal quotation marks omitted).
At oral argument, the City took the position that arrest for one of the
enumerated offenses was not per se conclusive that “the licensee’s continued
licensure would pose a threat to public health or safety,” but rather that drivers
were given a “real opportunity to show that they do not pose a risk to public
safety, arrests notwithstanding,” by presenting evidence relevant to that
determination. Nnebe II, 664 F.3d at 161. We were troubled, however, by the
record’s failure to clarify “what it is a driver may in fact attempt to show” to
prove that “the regulatory standard was not met ¯ [that] the charges, even if
true, did not demonstrate that continued licensure would pose a threat to public
safety.” Id. at 160. While we noted that the regulatory standard that the City
purported to apply might fall “within the range of adequate due process
protections,” we were nevertheless concerned that the asserted standard was “an
oft-quoted nullity that in no way resembles a part of the standard ALJs must
apply” as there was “little evidence that an ALJ is allowed actually to apply this
19
standard, . . . [but] considerable evidence supporting the appellants’ view that
they may not.” Id. at 160S61.
Furthermore, we noted that the district court had “assumed that the only
alternative to a hearing on identity and charge would be a hearing at which the
TLC would be required to prove that each driver engaged in the charged
conduct.” Id. at 163. While we agreed with the district court that a host of
problems could ensue if the City held “a hearing that functions as a preview of
the criminal case” and thus that such a hearing was not required by due process,
id. at 160, we noted that there might be other inquiries that could be less
burdensome to the City and that might be required, given the significant interests
of the plaintiffs, id. at 162S63. We posited, for example, that “even a hearing at
which the ALJ is permitted to examine the factual allegations underlying the
arrest, without making a determination of likely guilt or innocence, would
provide to drivers considerably more opportunity to be heard than the current
system, as the ALJ might in some cases determine that the allegations, although
arguably inconsistent with the criminal statute, do not provide any basis for
finding the driver to be a threat to public safety.” Id. at 163.
20
We thus remanded to the district court “to conduct additional fact-finding,
in the manner it deems appropriate, to determine whether the post-suspension
hearing the City affords does indeed provide an opportunity for a taxi driver to
assert that, even if the criminal charges are true, continued licensure does not
pose any safety concerns,” and then to determine, in light of that fact-finding,
“whether the hearing the City actually provides . . . comports with due process.”
Id. We did “not discuss the district court’s substantive due process analysis” as
plaintiffs had “expressly disavow[ed] [any substantive due process claims] on
appeal.” Id. at 153S54 n.2.
3. On Remand
On remand, the parties cross-moved for summary judgment. The district
court denied the motions, finding that it was “genuinely in dispute” whether
“the City meaningfully considers evidence other than the fact of arrest.” J. App’x
260. The court scheduled a trial to resolve the narrow issue of “whether the post-
suspension hearing the City affords does indeed provide an opportunity [both de
jure and de facto] for a taxi driver to assert that, even if the criminal charges are
true, continued licensure does not pose any safety concerns.” J. App’x 36
(alteration in original) (citation omitted).
21
Shortly before the scheduled jury trial, defendants raised an objection to
the proposed Jury Verdict form which would have included several
interrogatories concerning whether “the TLC policy allowed meaningful
consideration of,” inter alia, whether the driver had previous criminal convictions
or arrests, the facts and circumstances that led to the arrest, whether the driver
was given a DAT or arraigned, whether the driver was released without bail,
whether the charged conduct was committed on- or off-duty, and the driver’s
maturity, family background, and community ties. J. App’x 388S89. Defendants
suggested a single question for the jury instead: did the TLC policy allow
“meaningful consideration of whether even if the pending criminal charges are
true, the driver’s continued licensure would not pose a threat to the health or
safety of the public.” J. App’x 423. The district court noted that the objections
presented a “quandary” as “[i]n order for there to be a real, de facto opportunity
‘to assert that, even if the criminal charges are true, continued licensure does not
pose any safety concerns,’ the ALJs and the TLC Chair must be able to consider
something other than the fact of a mere criminal charge. But if none of the factors
listed in the verdict form may be considered, then the Court is frankly at a loss
for what that something might be.” J. App’x 425S26. The district court instructed
22
defendants to suggest factors that the TLC might consider, but warned that “if
they cannot even suggest any factors that an ALJ or the TLC Chair can consider
beyond the fact of arrest, then a directed verdict in this trial would appear
inevitable.” J. App’x 426S27.
In response, the TLC General Counsel stated that the TLC’s position
remained that it was open to considering other relevant factors and that evidence
supporting that position would be presented at trial. J. App’x 273. Shortly
thereafter, the parties agreed to a bench trial, rather than a jury trial, rendering
the verdict form moot. J. App’x 282.
The trial commenced on January 13, 2014, and concluded on January 21,
2014. Thirteen witnesses testified.
4. Findings of Fact
The district court issued its findings of fact on August 7, 2014. They are
detailed in Section II, above, but Judge Sullivan concluded by framing the
question upon remand as “whether the post-suspension hearing the City affords
does indeed provide an opportunity for a taxi driver to assert that, even if the
criminal charges are true, continued licensure does not pose any safety concerns”
(quoting Nnebe II, 644 F.3d at 163), and answering it as follows:
23
[D]rivers do have such an opportunity: a driver who has
been arrested may argue that continued licensure does
not pose any safety concerns because the charged crime,
based on its statutory elements, does not have a nexus to
public health or safety. The argument may rarely
succeed ¯ so far, it never has ¯ but the evidence in the
record shows that drivers may make such arguments,
the Chairperson may consider such arguments, and the
Chairperson may lift a suspension if the argument is
persuasive. That argument, however, is the only
argument an arrested driver can make. A driver cannot
argue, based either on any facts particular to the driver
or on the factual allegations in the criminal complaint,
that he or she would not pose any safety concerns. Put
simply, once the Chairperson has determined that (1) the
driver was charged with a crime, (2) the crime is still
pending, and (3) the charged crime has a nexus to public
health or safety, the inquiry is over and any other facts or
arguments are irrelevant.
J. App’x 72.
The district court then ordered additional briefing, specifically instructing
the parties to “focus only on procedural due process, as Plaintiffs have explicitly
waived any substantive due process claims.” Id.
5. Conclusions of Law
The parties submitted additional briefing in the Fall of 2014, and held oral
argument on the issue on December 5, 2014. On April 28, 2016, the district court
issued its conclusions of law. The court identified only one constitutional
24
violation: “that the notice provided by the TLC with respect to summary post-
suspension hearings held prior to December 2006 violated the procedural
component of the Due Process Clause of the United States Constitution.” J. App’x
75. It further found that “[i]n all other respects . . . Plaintiffs have failed to prove
their constitutional claims.” Id.
As to plaintiffs’ procedural due process claims that were not notice-related,
the district court identified the Mathews test as the relevant inquiry but went on
to emphasize that “procedural due process does not require a government
agency to provide a party with an individualized hearing where the purpose of
such a hearing would be to address a fact not relevant to the applicable
substantive inquiry.” J. App’x 83. The district court compared the instant case to
cases in which convicted sex-offender plaintiffs unsuccessfully sought hearings
on their individual dangerousness (or lack thereof) before being placed on sex-
offender registries, and concluded that “due process only requires that the
individual be granted an opportunity to prove or disprove facts relevant to the
substantive standard selected by the legislature.” J. App’x 84 (emphasis added).
More specifically, it held that the TLC regulatory scheme rested “on whether the
charges reflect a threat to public health or safety, not on whether an individual
25
driver in fact poses a risk to public health or safety.” J. App’x 85. As a result, the
district court concluded that “the driver’s individual characteristics and
evidentiary arguments relating to the strength of the criminal case against him
are simply not relevant to the regulatory framework, which rests on a limited
inquiry into the fact and nature of the charges. Thus, an additional hearing on an
irrelevant issue would have no bearing on or otherwise prevent an erroneous
license deprivation.” Id. (internal quotation marks omitted).
The court, concluding that “Plaintiffs really seem to be asserting a
substantive due process challenge to the TLC’s arrest-plus-nexus standard,” then
devoted a large portion of its opinion to a substantive due process analysis,
finding that any such claims would fail due to the “rational relationship”
between the Rule and a legitimate legislative purpose ¯ “protecting the public
from dangerous taxi drivers.” J. App’x 87, 91-92.
Finally, the court turned to the issue of whether the notice to the drivers
was constitutionally adequate, bifurcating the answer based on whether the
notice was given before December 2006 (when the Rule was amended) and
during and after December 2006. As to the second period, the court found no
violation, as the notice at that time cited the relevant rule, which clearly stated the
26
relevant issues for purposes of the hearing ¯ the fact of the charges, the
pendency of those charges, and the nexus between those charges and public
health or safety.
As to the first period, however, during which the relevant Rule did not
include this standard, but merely indicated that a summary suspension could be
ordered if the Chair “finds that emergency action is required to insure public
health, safety, or welfare,” and did not include anything about the issues to be
settled at the post-suspension hearing, the district court found that due process
had been violated. 35 R.C.N.Y. § 8-16 (1999). Specifically, it noted that a driver in
that period (during which all three named plaintiffs received their letters)
“would have had no way of knowing” what the critical issues were, and thus that
the notice was constitutionally inadequate. J. App’x 93.
Because there were state-law claims that were still pending, plaintiffs were
unable to appeal to this court; only when they withdrew those claims and the
district court issued its final judgment, on March 27, 2018, were they able to do
so. They filed this timely appeal thereafter. The defendants then cross-appealed
the district court’s finding of a pre-2006 notice violation.
27
B. Stallworth
On September 19, 2017, after the district court issued its opinion in Nnebe,
but before entry of final judgment, the Stallworth plaintiffs (Anthony Stallworth,
Parichay Barman, Noor Tani, and the New York Taxi Workers Alliance) brought
their action. The case was assigned to Judge Sullivan as “related” to the Nnebe
suit. The Stallworth plaintiffs are all drivers whose licenses were suspended after
each was arrested for leaving the scene of an accident.13 All three were issued
DATs and subsequently requested hearings. At their hearings, each introduced
evidence that he was not a danger to the public health or safety, by, for example,
calling character witnesses, and introducing his driving records as well as
evidence that he had no previous criminal convictions. All were unsuccessful;
their licenses were suspended for between 81 and 160 days 14 before being
reinstated after they pled guilty to reduced charges.15
13
These facts are drawn from the Stallworth complaint; for purposes of this
appeal, we accept the allegations as true and draw all reasonable inferences in
plaintiffs’ favor. Doe v. Columbia Univ., 831 F.3d 46, 48 (2d Cir. 2016).
14
At the time of the complaint, Stallworth’s license had been suspended for
approximately 45 days and had not yet been reinstated.
15
At their post-suspension hearings, the argument centered in part over whether
a finding of individualized dangerousness was relevant in light of Nnebe I and
Nnebe II.
28
Plaintiffs originally sought a temporary injunction, but the district court
denied it on November 22, 2017, on the basis of its opinion in Nnebe. Defendants
moved to dismiss; the motion was granted after the plaintiffs withdrew their
opposition. The Stallworth plaintiffs then appealed.16
DISCUSSION
The Nnebe plaintiffs ask us to conclude that the hearings the TLC offers are
not meaningful and that they thus violate due process. They also argue that the
TLC policy unconstitutionally assumes the guilt of the drivers. The Stallworth
plaintiffs appeal principally on the same issues, and add that the drivers are
denied fair warning of the law. Defendants cross-appeal the district court’s ruling
in Nnebe that the pre-December 2006 notices are constitutionally infirm.
16
The Stallworth action was thus filed at a time when the Nnebe action was stalled
due to the pendency of state-law claims, in an apparent effort to reach a quick
final judgment that would permit an appellate challenge to the district court’s
Nnebe decision. The effort succeeded, in that the Stallworth appeal was filed
before proceedings in Nnebe reached final judgment. When the Nnebe plaintiffs
then dismissed their state-court claims, however, and a final judgment in that
case was entered, an appeal was filed in that case as well. The two cases, which
raise substantially identical issues, were then placed on a similar schedule and
were heard in tandem.
29
I. Standard of Review
For the Nnebe appeal, we review the “district court’s findings of fact for
clear error, and its conclusions of law de novo.” CARCO GROUP, Inc. v.
Maconachy, 718 F.3d 72, 79 (2d Cir. 2013).
For the Stallworth appeal, “[w]e review the grant of a motion to dismiss de
novo, accepting as true all factual claims in the complaint and drawing all
reasonable inferences in the plaintiff[s’] favor.” Singh v. Cigna Corp., 918 F.3d 57,
62 (2d Cir. 2019).
II. Procedural Due Process
The Fourteenth Amendment provides that “[n]o state shall . . . deprive any
person of . . . property, without due process of law.” In a § 1983 suit brought to
enforce procedural due process rights, a court must first determine whether a
property interest is implicated, and then, if it is, determine what process is due
before the plaintiff may be deprived of that interest. Nnebe II, 644 F.3d at 158.
Here, there is no dispute as to the first part of the inquiry: “a taxi driver has a
protected property interest in his license.” Id. (quoting Nnebe I, 665 F. Supp. 2d at
323). Thus, we need decide only what process is due.
30
To make that determination, we balance the factors laid out by the
Supreme Court in Mathews v. Eldridge: (1) “the private interest that will be
affected by the official action;” (2) “the risk of an erroneous deprivation of such
interest through the procedures used, and the probable value, if any, of
additional or substitute safeguards;” and (3) “the Government’s interest,
including the ... fiscal and administrative burdens that the additional or
substitute procedural requirement[s] would entail.” 424 U.S. at 335.
In Nnebe I, the district court held that the Mathews factors favored the
Government, primarily because of what it assumed would be a “significant
financial and administrative burden on the TLC,” an assumption in part based on
the premise that only a process that included an adjudication as to the guilt or
innocence of an arrested driver would satisfy plaintiffs. Nnebe I, 665 F. Supp. 2d
at 328. On appeal, we questioned that premise, suggesting that it was “entirely
possible that a meaningful hearing can be devised at minimal cost to the City that
does not constitute a mini-trial on the criminal charges.” Nnebe II, 644 F.3d at 163.
On remand, in its conclusions of law, the district court did not balance the
Mathews factors ¯ instead it briefly noted the private interest at stake,
“direct[ing] its focus to what minimal process a taxi driver is due before he may
31
be deprived of his property interest in his license, and whether the process
afforded drivers is sufficient for such purposes.” J. App’x 84. It then concluded,
relying on Connecticut Department of Public Safety v. Doe, 538 U.S. 1 (2003) and Doe
v. Cuomo, 755 F.3d 105 (2d Cir. 2014), that the facts that the drivers asked for an
opportunity to prove ¯ namely, that their particular licensure did not pose a risk
to the public health or safety ¯ were not relevant to the substantive standard
selected by the TLC.
In Connecticut Department of Public Safety, the Supreme Court determined
that since the Connecticut legislature required convicted sex offenders to register
with the Connecticut Department of Safety, but based such a requirement not on
current dangerousness, but on the mere fact of conviction, due process did not
require an opportunity to prove a fact that was not material to Connecticut’s
statutory scheme ¯ namely, that a registrant did not pose a danger to his or her
community. 538 U.S. at 4. We reached a similar conclusion as to the New York
state registry in Cuomo, holding that “the New York State Legislature decided
that a conviction for a relevant offense was proof enough of dangerousness,” and
that therefore there was no procedural due process violation. 755 F.3d at 113.
32
The district court analogized those cases to the instant one, determining
that individual dangerousness was not material and thus that a meaningful
hearing on dangerousness was not required. The court based this determination
on a narrow reading of the regulatory standard, relying heavily on the word
“charges.” According to the district court, since the Rule states that the issue to be
determined is “whether the charges underlying the Licensee’s arrest, if true,
demonstrate that the continuation of the License while awaiting a decision on the
criminal charges would pose a threat to public health or safety, . . . the entire
regulatory scheme turns on whether the charges reflect a threat to public health or
safety, not on whether an individual driver in fact poses a risk to public health or
safety.”17 J. App’x 85.
We disagree with this reading of the Rule and thus find the sex offender
cases inapposite. Furthermore, we find the district court’s reading in tension with
the purpose of the Rule.
17
The district court did not distinguish the pre-2006 version of the Rule, which, in
its written form, allowed the TLC to suspend a license summarily if the Chair
found that “emergency action is required to insure public health, safety or
welfare,” perhaps because all parties agreed that the 2006 Rule simply codified
the existing standard, rather than changing it.
33
A. The TLC Rule
A close reading of the Rule, in accordance with New York state rules of
interpretation, reveals that individual dangerousness is, in fact, relevant under
the regulatory scheme.18 “[B]ecause the clearest indicator of legislative intent is
the statutory text, the starting point in any case of interpretation must always be
the language itself, giving effect to the plain meaning thereof.” Town of Aurora v.
Vill. of E. Aurora, 32 N.Y.3d 366, 372 (2018) (citation and internal quotation marks
omitted). The current TLC rule allows a license to be summarily suspended
“based upon an arrest or citation if the Chairperson believes that the charges, if
true, would demonstrate that continued licensure would constitute a direct and
substantial threat to public health or safety.” 35 R.C.N.Y. § 68-15(d)(1). The
current Rule further provides a list of charges that meet the pre-suspension
standard. Id. At the post-deprivation hearing, however, the relevant inquiry is
“whether the charges underlying the Licensee’s arrest, if true, demonstrate that
18
In its analysis of the Rule, the district court focused solely upon the 2014
iteration of the Rule. We do the same here, acknowledging that there were slight
variations throughout the years but that throughout the iterations the underlying
concerns remain the same. Because we find that individual dangerousness is
relevant even to the most recent Rule, we need not discuss in detail the previous
iterations, for which we find the same to be true.
34
the continuation of the License while awaiting a decision on the criminal charges
would pose a direct and substantial threat to public health or safety.” Id. § 68-
15(d)(3).
The district court emphasized the words “the charges . . . if true,” which
appear in both the pre- and post- suspension standards. While it is certainly
correct that those words cut against an interpretation that would authorize an
inquiry into whether the driver is in fact guilty of the charged offense, a focus on
these words alone gives short shrift to the rest of the regulatory text. See Town of
Aurora, 32 N.Y.3d at 372 (stating that a law “must be construed as a whole”
(citation omitted)). Read in context, the regulation is focused not on the threat
posed by the charges, but rather on the threat posed to the public by the driver’s
licensure. The TLC must show that the charges, if assumed to be true,
“demonstrate” that “the continuation of the License . . . would pose a direct and
substantial threat.” § 68-15(d)(3) (emphasis added). It is possible for a driver to be
charged with an act that itself endangered public health or safety, but that is
insufficient to demonstrate that the driver would continue to pose a threat if
allowed to retain his or her license. The crime may have been unrelated to his or
her duties, for instance, or a sole infraction in an otherwise spotless record. The
35
underlying conduct, while perhaps satisfying the elements of a crime on the
TLC’s list, may also be such as to persuade an ALJ and the TLC Chair that the
offense was technical or mitigated, such that continuation of the driver’s license
did not pose the kind of threat conjured by the general nature of the crime
charged. The Rule permits the TLC to put forward a charge as a proxy for
dangerousness, but its language does not foreclose arguments that the charge
alone fails to demonstrate that continued licensure would pose a threat.
Additionally, regulations are “to be read, if possible, in a manner
consistent with, rather than in opposition to, the governing statute.” People ex. rel.
Knowles v. Smith, 54 N.Y.2d 259, 267 (1981). As discussed above, the Ordinance
governing revocation of for-hire vehicle licenses allows the TLC to suspend a
license “for good cause shown relating to a direct and substantial threat to the
public health or safety,” and allows further suspension or revocation “after notice
and an opportunity for a hearing.” N.Y.C. Code § 19-512.1(a). The Ordinance
thus does not authorize suspension of a license upon arrest, but rather for “good
cause” that “relat[es] to a direct and substantial threat to the public health and
safety.” Id. (emphasis added). The good cause requirement, as well as the general
language of the Ordinance, shines the spotlight on whether the TLC has
36
demonstrated that keeping a driver on the road poses a threat to health or safety.
While the TLC may decide to treat an arrest for certain crimes as “good cause”
for immediate suspension pending further inquiry, under the statutory scheme it
remains relevant whether the arrest in fact “relat[es]” to a health or safety threat
to the public from continued licensure of the driver. And because that threat
must be both “direct” and “substantial,” it is relevant whether the conduct
underlying the arrest and the overall record and character of the driver confirms
or disproves the arrest’s relation to public health or safety. Thus, for example, in
the majority of cases, the further removed the crime is from the driver’s job, the
less “direct” the threat may be if he or she remains licensed. Depending on the
surrounding circumstances and the driver’s history, the threat may also be more
or less “substantial.”
Moreover, it is useful to put the post-suspension hearing issue back into its
proper due process context. Suspension of a driver’s license is automatic upon
arrest for any felony or listed misdemeanor. The Nnebe plaintiffs originally
argued that due process requires a hearing before the suspension takes effect. In
Nnebe II, we agreed with the City and the district court that a pre-suspension
hearing was not required, because the fact of an arrest provided sufficient indicia
37
of a threat to public health and safety to permit an immediate suspension at a
point at which little was known about the driver and the charged crime,
provided that the driver would be given a post-deprivation hearing. Nnebe II, 644
F.3d at 158S59. The post-deprivation hearing thus provides the necessary inquiry
into the propriety of the suspension in light of the fuller record that can be
compiled in the aftermath of the arrest, which might confirm or dispel the initial
impression that the driver’s continued licensure would pose a threat to the safety
of the public.
Thus, by reading the Rule as a whole and consistently with the Ordinance
under whose authority it was promulgated, we conclude that the individual
circumstances underlying a taxi driver’s suspension are relevant to the statutory
scheme and to the role that a due process hearing is designed to play when a
person is threatened with the loss of a valuable property interest.
Finally, “[w]hile examining the specific language of statutory provisions is
part of our inquiry, we must also look to the underlying purpose and the
statute’s history. . . . The legislative intent is the great and controlling principle.”
Meegan v. Brown, 16 N.Y.3d 395, 403 (2011) (internal quotation marks omitted); see
also Goodwin v. Perales, 88 N.Y.2d 383, 395 (1996) (noting that regulations may go
38
beyond the text of a statute only “as long as they are in harmony with the
statute’s over-all purpose”). As noted above, the Ordinance bespeaks a clear
intent to leaven the Commission’s eagerness to discipline drivers with greater
concern for drivers’ rights. Indeed, the City Council embedded its concern into
the text of the Ordinance in the form of a legislative “find[ing] that certain of the
rules promulgated within the past several months by the [TLC], such as those
that modify the disciplinary measures that may be imposed against taxicab and
for-hire vehicle drivers, taxicab and for-hire vehicle owners and taxicab
medallion owners are onerous.” N.Y.C. Code § 19-512.1, n.1 (1999).19 Suspensions
continued due to arrests alone, with no meaningful ability to contest the TLC’s
determination that the licensee poses a threat, would appear to be just the kind of
“onerous” disciplinary measure that the City Council passed § 19-512.1 to
eliminate.
Thus, the text of both the Rule and the Ordinance, as well as the legislative
purpose underlying the Ordinance, all indicate that the threat from a given
19
This language apparently referenced a recently-established Persistent Violator
program, which “created a point system for license revocation” that the industry
complained “impose[d] penalties . . . for conduct . . . unrelated to passenger
safety.” Arif v. N.Y.C. Taxi & Limousine Comm’n, 2002 WL 1559732, at *5 (N.Y.
Sup. Ct. July 10, 2002) (alteration omitted), rev’d on other grounds, 3 A.D.3d 345
(N.Y. App. Div. 2004).
39
driver’s continued licensure is the lodestar of the statutory and regulatory
inquiry, and that the hearing is intended to provide a meaningful process for
drivers. We thus disagree that the only consideration relevant to the inquiry is
the statutory charge; a meaningful hearing, for purposes of the Rule, must give
the driver an opportunity to show that his or her particular licensure does not
cause a threat to public safety. With that understanding, we turn to the Mathews
factors.
B. Mathews Factors
1. Private Interest
The first factor to be considered in the Mathews inquiry is “the private
interest that will be affected by the official action.” Mathews, 424 U.S. at 335. As
we have already stated in this case, “the private interest at stake . . . is enormous
¯ most taxi drivers rely on the job as their primary source of income and often
earn the sole income for large families in a city where the cost of living
significantly exceeds the national average.” Nnebe II, 644 F.3d at 159 (internal
quotation marks omitted). Indeed, we have previously held that this factor favors
more extensive process where the interest at stake is “operating a business
and . . . pursuing a particular livelihood.” Spinelli v. City of New York, 579 F.3d
40
160, 171 (2d Cir. 2009) (internal quotation marks omitted). Moreover, “[t]he
Supreme Court has ‘repeatedly recognized the severity of depriving someone of
his or her livelihood.’” Id. (quoting FDIC v. Mallen, 486 U.S. 230, 243 (1988)); see
also Brock v. Roadway Exp., Inc., 481 U.S. 252, 263 (1987); Cleveland Bd. of Educ. v.
Loudermill, 470 U.S. 532, 543 (1985); Goldberg v. Kelly, 397 U.S. 254, 264 (1970).
In the past, we have registered particular concern about the inability to
remedy this type of deprivation, noting that “a licensee erroneously deprived of a
license cannot be made whole simply by reinstating the license,” and that “the
interim period between erroneous deprivation and reinstatement can be
financially devastating to the licensee.” Spinelli, 579 F.3d at 171 (citations and
internal quotation marks omitted).
We thus have little difficulty in concluding ¯ particularly upon a record
demonstrating that plaintiffs were deprived of their licenses for several months
at a time ¯ that the private interest here is extremely strong. The first
Mathews factor favors the plaintiffs.
2. Risk of Erroneous Deprivation
Next, we consider “the risk of an erroneous deprivation” under the
procedures used by the TLC, along with “the probable value, if any, of additional
41
or substitute procedural safeguards.” Mathews, 424 U.S. at 335. We note at the
outset that in New York state, “[u]nlike a felony charge, for which a ‘prompt’
probable cause hearing must be held or evidence of probable cause must be
presented to a grand jury, a misdemeanor charge . . . requires no post-arrest
determination.” Krimstock v. Kelly, 306 F.3d 40, 44 (2d Cir. 2002); see also People v.
Green, 96 N.Y.2d 195, 199S200 (2001). Compare N.Y. Crim. Proc. § 170.10
(misdemeanors) with N.Y. Crim. Proc. § 180.10 (felonies). What this means in
practice is that a driver can be arrested for a misdemeanor based on an on-the-
scene determination of reasonable cause made by the arresting officer,20 and then
have his license suspended for the several months that follow, without any
meaningful opportunity to challenge the arrest.
In this case, the risk of erroneous deprivation can be assessed by looking to
the statistics regarding the outcome of the cases in which drivers’ taxi licenses
were suspended. The TLC hinges the ultimate decision as to whether to continue
the suspension of a license on the outcome of the criminal case. In other words,
the TLC discontinues the suspension of an arrested driver only if the charges are
20
New York Criminal Procedure Law § 140.10(1) allows a police officer to arrest a
suspect without a warrant for “reasonable cause” that the arrestee has committed
a crime “whether in his or her presence or otherwise.”
42
dismissed, reduced to an offense that does not warrant a suspension, or resolved
favorably. Upon the occurrence of any of these three dispositions, the driver is
reinstated without further inquiry into his conduct. As the district court found,
the charges against at least 75% of arrested drivers are resolved favorably to the
driver, and the drivers’ licenses are accordingly reinstated.21 J. App’x 66. In fact,
there was evidence presented at trial indicating that, putting aside arrests for
driving under the influence, the percentage of drivers whose licenses are
reinstated could be as high as 90%.22 J. App’x 61, 383.
In an analogous case, Valmonte v. Bane, 18 F.3d 992, 995 (2d Cir. 1994), the
plaintiff brought a § 1983 claim challenging her inclusion on a registry of child
abusers, where a person could be placed on the registry based on a “some
credible evidence” standard. Considering both the private interest (the plaintiff’s
right to secure employment in the child care field) and the Government interest
(its parens patriae obligation to protect children from abuse and maltreatment) to
be extremely strong, we concluded that “the deciding factor” was an
21
Defendants do not challenge this finding.
22
The calculation excluding charges of driving under the influence of intoxicants
is relevant because such convictions may well be more likely to lead to a high
percentage of continued suspensions even where a meaningful hearing is
provided.
43
unacceptably high risk of error, as evidenced by the fact that “nearly 75% of those
who seek expungement of their names from the list are ultimately successful.” Id.
at 1003. We held that “[t]he fact that only 25% of those on the list remain after all
administrative proceedings have been concluded indicates that the [procedures
used were] at best imperfect.” Id. at 1004.
Here, as many as 75% of taxi drivers will have their licenses reinstated
with no further inquiry into the danger posed by any individual driver to the
taxi-riding public. Thus, the vast majority of the suspensions will turn out to have
been, by the standard applied by the TLC itself, erroneous.23 Nor can this
deprivation “be recompensed by the claimant’s prevailing in later proceedings,”
Krimstock, 306 F.3d at 63, as there is no way to make up for the income lost during
23
We are cognizant that some number of the 75% of drivers whose licenses were
not revoked were vindicated based on their innocence of the charged offense, a
factor that would not in any event be canvassed in a proper hearing. J. App’x 66;
see also Nnebe II, 644 F.3d at 160. That does not deprive the statistic of significance,
however. It is the best available evidence of the percentage of drivers charged
with crimes and summarily suspended under the regulation who are ultimately
deemed unfit to retain their licenses. Suspension pending resolution of charges
may be entirely appropriate in some number of cases that do not ultimately result
in conviction and revocation of licenses. But when such a preponderant
percentage of summary suspensions are not ultimately vindicated by a finding of
unfitness, that fact surely weighs heavily against the defendants’ argument that
essentially automatic suspensions, for a period of many months, are required to
ensure public safety, and that no further review of individual cases is required by
the constitutional guarantee of procedural fairness.
44
the period in which the driver’s license is suspended. We find this to be an
unacceptably high risk of error, and thus find that the second factor, like the first,
favors plaintiffs.
3. Government Interest
The Supreme Court has recognized the “significant interest” that the
government has “in immediately suspending, when felony charges are filed
against them, employees who occupy positions of great public trust and high
public visibility, such as police officers.” Gilbert v. Homar, 520 U.S. 924, 932 (1997).
And we have noted, when this case was last before us, that “[a]mong the most
critical functions performed by the TLC are ensuring the safety of the taxi-riding
public and maintaining the public’s trust in the safety of taxis,” and thus that “an
arrest for a felony or serious misdemeanor creates a strong government interest
in ensuring that the public is protected in the short term, prior to any hearing.”
Nnebe II, 644 F.3d at 159 (alteration in original) (internal citations and quotation
marks omitted). For that reason, we affirmed the decision below that there was
no constitutional violation in failing to offer drivers a pre-suspension hearing,
since “in the immediate aftermath of an arrest, when the TLC has minimal
information at its disposal and the very fact of an arrest is cause for concern, the
45
government’s interest in protecting the public is greater than the driver’s interest
in an immediate hearing.” Id. However, in the post-deprivation context, “the
existence of ‘exigent circumstances’ warranting a deprivation before holding a
hearing is irrelevant. The relevant inquiry is whether the City had a legitimate
interest in not providing [drivers] with meaningful post-deprivation due
process.” Spinelli, 579 F.3d at 174.
The district court found, in Nnebe I, that additional administrative
procedures ¯ specifically, a hearing that attempted to adjudicate the guilt or
innocence of an individual driver ¯ would “unacceptably interfere with the
parallel criminal proceeding” and “present a significant financial and
administrative burden on the TLC.” 665 F. Supp. 2d at 328. “We agree[d] with the
district court that the City cannot be required to hold a hearing that functions as a
preview of the criminal case.” Nnebe II, 644 F.3d at 160. But we considered the
possibility that “a meaningful hearing can be devised at minimal cost to the City
that does not constitute a mini-trial on the criminal charges.” Id. at 163.
Defendants did not respond to our supposition by attempting to show, on
remand, that a hearing that allowed, for example, an inquiry into the facts
underlying a criminal complaint, the driving record of the arrested driver, or
46
whether the charged conduct occurred on- or off-duty, would financially or
administratively burden the TLC. Indeed, the TLC already allows such testimony
to be heard and such evidence to be presented. They thus do not, and perhaps
could not, credibly contend that allowing the ALJ or TLC Chair to consider the
evidence already presented at the post-suspension hearings would present an
onerous administrative task.
Thus, while we take seriously the Government interest implicated, we hold
that, given the potential of conducting far more meaningful hearings at little or
no additional financial or administrative cost to the TLC, that interest is
outweighed by the private interest at stake and the unacceptably high risk of
erroneous deprivation.
In Nnebe II, we reserved the question of “whether a hearing that does
nothing more than confirm the driver’s identity and the existence of a pending
criminal proceeding against him would in fact be adequate process to allow the
City to suspend a driver’s taxi license until the criminal charges are resolved.” Id.
at 161. We now decide that, under the circumstances presented here, given the
high risk of erroneous deprivation of the driver’s livelihood for a period of
months, and under this particular statutory regime that emphasizes the danger of
47
licensure to the public health and safety, a hearing that in effect conclusively
presumes that suspension is appropriate based solely on the abstract relationship
of the elements of a charged offense to safe driving provides inadequate
process.24
That conclusion is bolstered by our holding in Krimstock v. Kelly, 306 F.3d
40. In Krimstock, we held that drivers whose cars were seized for forfeiture after
an arrest for certain crimes for which the car could be considered an
instrumentality were entitled to a prompt hearing to contest the legitimacy of the
seizure. Id. at 43S44. Noting that “[a] car or truck is often central to a person’s
livelihood or daily activities,” we concluded that “[a]n individual must be
permitted to challenge the City’s continued possession of his or her vehicle
during the pendency of legal proceedings where such possession may ultimately
prove improper and where less drastic measures than deprivation pendente lite
are available and appropriate.” Id. at 44. We were particularly concerned with
24
We further agree with the Nnebe II court that the out-of-Circuit cases cited in
Nnebe I ¯ Brown v. DOJ, 715 F.2d 662 (D.C. Cir. 1983) and Cooke v. Social Security
Admin., 125 F. App’x 274 (Fed. Cir. 2004) ¯ are distinguishable by virtue of the
facts that: (1) taxi drivers, unlike the plaintiffs in those cases, are not City
employees; (2) the misconduct here, unlike that in Brown and Cooke, need not be
work-related; and (3) summary suspension can be triggered by a warrantless
arrest, whereas in both Brown and Cooke there had been an independent probable
cause determination. See Nnebe II, 644 F.3d at 162.
48
“the temporal gap that typically exists between seizure of the vehicle and the
forfeiture proceeding.”25 Id. at 53. We concluded that “the Due Process Clause
requires that claimants be given an early opportunity to test the probable validity
of further deprivation, including probable cause for the initial seizure, and to ask
whether other measures, short of continued impoundment, would satisfy the
legitimate interests of the City in protecting the vehicles from sale or destruction
pendente lite.” Id. at 68.
We note that in Krimstock, there was no prompt post-deprivation hearing
held at all and that our opinion focused heavily on that defect. But there are also
some clear similarities between the instant case and Krimstock. Here, a license to
drive a taxicab is not simply “often” central to the driver’s livelihood; it is a
prerequisite to plying his or her trade. And while the TLC does provide a post-
deprivation hearing, plaintiffs successfully argue that the hearing is effectively
meaningless. Moreover, the Krimstock Court did not remand the case with
instructions to hold a hearing merely on the fact of the arrest of a given claimant
¯ instead, it required the hearing to allow for a testing of the “probable cause for
the initial warrantless seizure.” Id. at 70. As in this case, we emphasized that we
25
The forfeiture proceeding often took place “months or even years after the
seizure.” Krimstock, 306 F.3d at 45.
49
did “not envision the retention hearing as a forum for exhaustive evidentiary
battles that might threaten to duplicate the eventual forfeiture hearing,” but
nevertheless concluded that a hearing that was less intrusive into the anticipated
law-enforcement proceeding was both possible and required to provide due
process. Id. at 69S70.
The concerns with which we grappled in Krimstock apply with equal force
here. As in Krimstock, a taxi-driver’s license can be suspended without any
independent determination of probable cause, and the deprivation could last
weeks or months. And while the TLC Rule does provide a prompt post-
deprivation hearing, as discussed above, that hearing is meaningless. Here, as in
Krimstock, a lengthy deprivation of property, based on an arrest without a judicial
determination of probable cause and without a deeper inquiry into whether the
deprivation is appropriate, violates the Constitution’s guarantee of procedural
due process.
We therefore find a procedural due process violation, and remand to the
district court to fashion a constitutionally adequate process, after hearing from
the parties. We emphasize that we do not require an inquiry into factual guilt or
innocence to satisfy the due process inquiry; rather, a hearing that encompasses
50
some level of conduct-specific findings based upon the facts underlying the
complaint and the driver’s history and characteristics, for example, would be
sufficient. Additionally, the district court should consider on remand the
plaintiffs’ Rule 23 motion for class certification, and determine what, if any,
damages plaintiffs are due.26
II. Notice
The district court held that the notice provided to drivers before December
2006 denied due process, but that the notice given since that point has been
sufficient. The parties cross-appeal that conclusion.
“Parties whose rights are to be affected are entitled to be heard; and in
order that they may enjoy that right they must first be notified.” Fuentes v. Shevin,
407 U.S. 67, 80 (1983) (internal quotation marks omitted). “[I]n the absence of
effective notice, the other due process rights . . . such as the right to a timely
hearing . . . are rendered fundamentally hollow.” Kapps v. Wing, 404 F.3d 105, 124
26
While we express no view on the class certification and damages issues, we
note that the deprivation of a hearing alone does not necessarily proximately
cause a loss of income, since a hearing in a particular case may well have led to a
continued suspension in any event. See Warren v. Pataki, 823 F.3d 125, 143 (2d Cir.
2016) (noting that “[i]n the procedural due-process context, actual damages are
based on the compensation that resulted from the plaintiff’s receipt of deficient
process,” which involves a determination of “whether a different outcome would
have been obtained had adequate procedural protections been given”).
51
(2d Cir. 2005). For notice to be effective, it must inform the affected party of what
“critical issue” will be determined at the hearing. See Turner v. Rogers, 564 U.S.
431, 447 (2011). In addition, “[p]art of the function of notice is to give the charged
party a chance to marshal the facts in his defense.” Wolff v. McDonnell, 418 U.S.
539, 564 (1974). Adequate notice must “reasonably . . . convey the required
information that would permit [a driver] to present [his or her] objections” to the
continuation of a suspension. Spinelli, 579 F.3d at 172 (citation and internal
quotation marks omitted).
Citing to the version of the Rule then in effect, the district court found that
the pre-December 2006 notice did not indicate what standard would apply at the
post-suspension hearing, as neither the Rule nor the notice informed the driver as
to the critical issue to be determined at the hearing. Defendants appeal, arguing
that “any reasonable driver would know that they could challenge their
suspension by asserting that they had not been charged with a crime and by
challenging the assumption of dangerousness.” Appellees’ Br. 57S58. They
maintain that the information contained in the notice ¯ that the driver’s license
was being suspended based on an arrest for the charge identified in the letter
52
with a citation to the relevant Rule ¯ was adequate to allow the taxidriver to
marshal evidence and prepare a defense.
While we do not imply that adequate notice must include a roadmap to a
successful defense, the notice here falls considerably on the other side of that line.
The text of the Rule pre-2006, as well as the encouragement given to drivers by
the TLC ALJs, gave the driver no indication that the only issue that mattered was
the question of a “philosophical nexus” between the abstract elements of a
charged offense and public safety, for which he or she would need to marshal a
dramatically different case¯ case law and legal argument ¯ than he or she
would to show evidence of his or her own lack of dangerousness. Indeed, the
misleading quality of the notice was confirmed by the fact that drivers did
present, and ALJs were instructed to admit, evidence regarding their individual
records and the specific facts charged by the arresting officer — evidence that the
ALJs were then privately directed not to consider. We thus affirm the lower court
on the inadequacy of the pre-2006 notice.
As the district court interpreted the Rule, the sufficiency of the post-
December 2006 notice presented a closer question, since the notice then cited a
version of the Rule that the district court believed embodied the “arrest-plus-
53
nexus” standard. Moreover, the drop-off in hearing requests after November
2007 suggests that drivers and their union representatives were being made
aware in some manner of the standard being applied to facts by the ALJs and the
TLC Chair that rendered the hearings futile.
As we have held above, however, that standard was not what the Rule
actually required. We therefore disagree with the lower court’s decision that the
notice became adequate when the language of the Rule changed. For the very
same reasons the district court found that drivers would be ill-prepared for the
hearing the TLC provided before 2006, they would remain ill-prepared and
poorly-informed as to what evidence would be relevant to their hearings
thereafter.
We thus find that the notice given, both before and after December 2006,
was constitutionally infirm. This conclusion is largely academic, in light of the
more fundamental problem that the hearing in question was constitutionally
insufficient, regardless of the content of the notice.
54
III. Additional Issues
A. Substantive Due Process
Despite the plaintiffs’ protestations that they did not bring claims based in
substantive due process, the district court proceeded to assess a potential
substantive due process claim, finding no such claim was viable. Because the
plaintiffs do not press, and indeed have affirmatively disavowed, any such claim,
we have no reason to discuss the issue.
B. Unconstitutional Presumption of Guilt
Plaintiffs additionally argue that what they characterize as a presumption
that the taxi drivers are guilty of the charges, for purposes of the hearings, is
unconstitutional in light of Nelson v. Colorado, 137 S. Ct. 1249 (2017). In Nelson, the
Court determined that it was unconstitutional to continue to deprive defendants
whose convictions had been vacated or reversed of property that had been
retained upon their conviction. Id. at 1252. The Court, noting that “the
presumption of innocence lies at the foundation of our criminal law,” held that
defendants in that posture should have to meet no burden to recover their
property, as they were once again presumed innocent in the eyes of the law. Id. at
1256 (citation and internal quotation marks omitted).
55
Plaintiffs’ analogy to Nelson is inapt. Nelson struck down a law that
permitted the State to retain costs, fees and restitution charged to criminal
defendants, even after a criminal prosecution had resulted in the invalidation of
their convictions, unless the defendant proved his or her factual innocence by
clear and convincing evidence. Id. at 1255. Here, by contrast, the drivers’ charges
remain pending. Rather than relying on an assumption of guilt, the TLC Rule
says, in effect, that if a charge is serious enough to warrant revocation of a license
upon conviction, then it is serious enough to warrant suspension upon arrest. It is
true that the TLC Rule allows initial and continued suspensions based on arrests
for at least eighteen misdemeanors, which in New York may occur without a
warrant. N.Y. Crim. Proc. § 140.10(1); see Nnebe II, 644 F.3d at 162. It is also true
that police officers who arrest someone for a misdemeanor without a warrant
may issue the accused a Desk Appearance Ticket (“DAT”), NY. Crim. Proc. §
150.20(1)S(2), and that until the accused appears on the date set by the DAT no
neutral factfinder will have determined that the arrest was based on probable
cause. However, any concern about the lack of probable cause in a particular case
is mitigated, for purposes of the license suspension process, by our holding that
the TLC must allow drivers to argue that the circumstances surrounding their
56
arrest show that there is no reason to deem them a danger. Viewing the Mathews
factors in light of the procedural changes our ruling today will require, and for
the reasons set forth in Nnebe II, we see no constitutional infirmity in a process
that allows for context-specific findings but does not open the question of a
driver’s factual guilt of the criminal charges. We leave that to be resolved in the
criminal courts, with the burden on the prosecution to prove guilt beyond a
reasonable doubt.
C. Fair Warning
Finally, the Stallworth plaintiffs argue that defendants have denied them
fair warning of the law. Citing FCC v. Fox Television Stations, Inc., 567 U.S. 239, 253
(2012) for the proposition that “laws which regulate persons or entities must give
fair notice of conduct that is forbidden or required,” and that a regulation will be
unconstitutionally vague if “it is unclear as to what fact must be proved,”
plaintiffs argue that the Rule does not satisfy these constitutional requirements.
Stallworth Appellants’ Br. 57.
That argument is merely another version, and a less convincing one, of
plaintiffs’ notice argument. The cases on which plaintiffs rely are inapposite. Both
cases address the harm that occurs where prohibited conduct is not clearly
57
defined or when an agency exceeds it authority in enforcing the law.27 Here,
plaintiffs concede that prohibited conduct is clearly defined by the Rule, and do
not argue that the TLC exceeds its authority by continuing their suspensions.
Plaintiffs note that the Fair Warning Doctrine applies not only to
proscribed conduct but also to collateral consequences of that conduct, citing
Johnson v. United States, 135 S. Ct. 2551 (2015), and Sessions v. Dimaya, 138 S. Ct.
1204 (2018). But those cases were concerned with the vagueness of the residual
clauses of, respectively, the Armed Career Criminal Act and the federal criminal
code’s definition of “crime of violence,” as incorporated into the Immigration and
Nationality Act, and the particular problems that arose from the interactions
between the state criminal codes and federal law; the Court concluded in both
cases that there was indeed uncertainty as to which crimes would be considered
sufficiently violent to trigger particular federal consequences.
27
In FCC v. Fox Television Stations, Inc., 567 U.S. 239 (2012), the Court found the
law in question unconstitutionally vague because it did not give notice to
television broadcasters that fleeting expletives or momentary nudity could be
found actionably indecent when previous FCC decisions had found that such
circumstances would not be considered actionably indecent; in SEC v. Sloan, 436
U.S. 103 (1978), the Court held that the SEC exceeded its authority when it
imposed an indefinite trading suspension under a statute that explicitly stated
that the SEC could suspend trading for no more than ten days.
58
In contrast, the Stallworth plaintiffs were all suspended under a version of
the Rule that specifically enumerates the offenses that will trigger a summary
suspension. There is little doubt that certain misdemeanors and all felonies will
always lead to a summary suspension and that a hearing will follow. The issue is
not that the warning is not fair; it is, as discussed above, that the hearings that
follow fail to provide any real opportunity for a driver to contest that
suspension.28 Accordingly, plaintiffs’ fair warning argument fails.
CONCLUSION
For the foregoing reasons, we AFFIRM in part and REVERSE in part the
judgments of the district court and REMAND for further proceedings. The Nnebe
judgment is affirmed insofar as it found a notice violation, and reversed insofar
as it found no violation of procedural due process. The Stallworth judgment,
which relied upon the Nnebe judgment, is affirmed as to the assumption of guilt
and fair warning claims but is otherwise reversed. On remand, the district court
is directed to address the proper remedies for the constitutional violations
28
To the extent plaintiffs claim they were denied fair warning because the written
Rule, which makes facts other than the fact of arrest relevant to the suspension
decision, failed to warn them that the TLC’s de facto standard ignored such
evidence, that argument is duplicative of plaintiffs’ fair notice claim.
59
established by the plaintiffs as well as the motion for class certification and the
damages, if any, to which plaintiffs are entitled.
60