Martin v. Stites

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
FEB 13 2001
TENTH CIRCUIT
__________________________ PATRICK FISHER
Clerk
JIMMIE L. MARTIN, d/b/a J & L Services;
EDDIE M. HAYNES, d/b/a Twilite
Recovery Services; MORSE’S AUTO
SALVAGE & TOW SERVICE, INC.;
LESLIE L. MORSE, SR.; JOHN W. No. 99-3192
MORSE; ROBERT L. MORSE, (D. Kan.)
(D.Ct. No. 98-CV-2226-GTV)
Plaintiffs-Appellants,
v.
MARVIN V. STITES, Linn County Sheriff,
in his individual and official capacities;
MARTIN J. READ; HAROLD J. MOONEY,
JR.; CHARLES TRASK, Linn County
Board of County Commissioners, in their
individual and official capacities; DEAN
SCHOENHALS, d/b/a/ Northside Auto,
Defendants-Appellees.
____________________________
ORDER AND JUDGMENT *
Before BRORBY, POLITZ, ** and BRISCOE, Circuit Judges.
*
This order and judgment is not binding precedent except under the doctrines of
law of the case, res judicata and collateral estoppel. The court generally disfavors the
citation of orders and judgments; nevertheless, an order and judgment may be cited under
the terms and conditions of 10th Cir. R. 36.3.
**
The Honorable Henry Politz, United States Circuit Judge for the Fifth Circuit,
sitting by designation.
We must decide on appeal whether county established towing policies are
preempted by federal law. The district court denied plaintiffs’ motions for
preliminary injunction and partial summary judgment on the federal preemption
issue and granted defendants’ motion for partial summary judgment on the same
issue, holding the sheriff’s policies are not preempted by § 14501(c) of the
Interstate Commerce Commission Termination Act (“ICCTA”). The district court
subsequently denied plaintiff’s motion for reconsideration. Plaintiffs appeal the
district court’s rulings on the issue of federal preemption. We affirm.
FACTUAL BACKGROUND
Mr. Martin, Mr. Haynes and the Morses (collectively “Towing Companies”)
are Linn County, Kansas, tow truck operators. They sued Sheriff Stites and
members of the Linn County Board of Commissioners (“Commissioners”) for
violation of the Interstate Commerce Commission Termination Act, 49 U.S.C.
§ 14501(c)(1). 1 Section 14501(c)(1) expressly preempts state and municipal laws,
regulations or provisions “having the force and effect of law” that regulate the
1
Mr. Martin, Mr. Haynes and the Morses brought suit in the district court alleging
Sheriff Stites and the Commissioners violated anti-trust, civil rights, and federal
preemption laws. The summary judgment order appealed here deals only with the
preemption claim. Mr. Schoenhals, a private tow operator and owner of Northside Auto,
is also a defendant in the case, but is not involved in the federal preemption issue in this
appeal.
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prices, routes or services provided by towing companies. The Towing Companies
challenge two county-wide towing policies.
The first policy was announced in December 1997, at a public Board of
County Commissioners meeting. The minutes from the meeting report that as a
result of an executive session, requested by Sheriff Stites to consult with counsel
on a legal matter, the county “set a 60-day moratorium for towing county
requested vehicles. After that 60 days, the county will only use tow services that
have filed an approved application for county tows and been approved by the
county commission.” The sheriff, among other people, was tasked with designing
an application form.
As implemented by the sheriff, this policy requires each tow operator to fill
out an “Application for Permit for Towing Services for Linn County” (“permit
form”) in order to receive non-preference tow calls from the sheriff’s
department. 2 The permit form seeks personal and tow truck information, asks
2
A “non-preference tow” call is one in which the owner or operator of a disabled
vehicle has no preference for a particular tow truck operator. In such an instance, the
sheriff’s department relays a call to a local tow truck company. If, however, the owner or
operator of the disabled vehicle expresses a preference for a particular tow operator, the
sheriff’s dispatcher calls the requested tow truck operator.
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whether the operator has current Kansas Corporation Commission authority,
requests a copy of the vehicle’s inspection report showing compliance with 49
CFR 396.17 - 396.23, and requires the applicant to disclose the location of the
applicant’s legal and properly zoned storage area for vehicles. Both the sheriff
and the county commission chairman must approve and sign the permit form.
Thus, the completion and approval of the permit form is a prerequisite to being
put on the list to receive non-preference tow calls from the sheriff’s dispatcher.
However, a county-based or out-of-county operator can conduct preference tows
in Linn County without completing a permit form.
The second towing policy divides the county geographically into eastern
and western portions for purposes of assigning non-preference tow truck calls. In
1995, when Sheriff Stites first became sheriff, the department used a geographical
division of Linn County. In 1997, Sheriff Stites changed to a pure rotation
system, in which the geographic location of the towing company was irrelevant.
In February 1998, however, the policy was again altered to allocate non-
preference calls based on a geographic division of the county.
The minutes from the February 1998 public meeting reveal the second
policy was announced following an executive session. There are no minutes from
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the executive session in the record, but the minutes recorded from the regular
session disclose that “[a]s a result of the executive session the commission
reported that from now on towing services for the county will be split from east
and west .... This arrangement will be for the county tows and non preference
tows.” Under the new policy, the Morses were allotted the western part of the
county, while Mr. Martin, Mr. Haynes, and Mr. Shoenhal were assigned the more
lucrative eastern part of the county, from which eighty percent of the non-
preference tows are generated. The Towing Companies have since complained
that in practice most non-preference calls are directed to Mr. Shoenhal’s towing
business. The Towing Companies sought declaratory and injunctive relief from
the district court.
PROCEDURAL HISTORY
In order to establish our jurisdiction to review the merits of the Towing
Companies’ preemption claim, it is necessary to detail the procedural history of
this case. The district court, after holding an evidentiary hearing, denied the
Towing Companies’ motion for preliminary injunction because the Towing
Companies “failed to put forth evidence that Sheriff Stites’ towing policy
amounted to a law, a regulation, or other provision having the force and effect of
law”; and therefore failed to establish the Towing Companies’ substantial
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likelihood of success on the merits. 3
Subsequently, the district court ruled on the parties’ cross-motions for
partial summary judgment on the federal preemption issue. The district court
granted the Commissioner’s motion for partial summary judgment, and denied the
Towing Companies’ motion. In a terse order, the district court held the summary
judgment papers revealed no genuine issue of material fact, and “as a matter of
law, Sheriff Stites’ towing policy does not amount to a law, a regulation, or other
provision having the force and effect of law.” While the district court did not
explain its reasoning, the court apparently consolidated the two towing policies
into one, and found the “towing policy,” as a whole, was not preempted because
there was no evidence the commission invoked its home rule authority when
adopting the policy pursuant to Kansas law, K.S.A. § 19-101a.
The district court granted the parties’ joint motion to certify the court’s
partial summary judgment rulings as a final order, pursuant to Rule 54(b). An
order nunc pro tunc expressly limited the scope of the final order to the
preemption claim.
3
The district court did not explain whether the “towing policy” it referred to was
the permit or the geographic division policy, or both.
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The Towing Companies timely filed a “motion to reconsider” their
application for preliminary injunction, motion for partial summary judgment, and
the granting of defendant’s motion for partial summary judgment. The district
court construed the Towing Companies’ motion for reconsideration as a Rule
59(e) motion to alter or amend the judgment, and denied the motion because the
court found “the Linn County towing policy does not amount to a law, regulation,
or other provision having the force and effect of law; therefore, it is not
preempted by 49 U.S.C. § 14501.”
The Towing Companies filed an interlocutory appeal to this court, and the
district court stayed all other proceedings in the case. In the Towing Companies’
notice of appeal, they challenge the district court’s orders: 1) refusing plaintiff’s
motions for preliminary injunction; 2) denying plaintiff’s motion for partial
summary judgment; 3) granting defendants’ motion for partial summary judgment;
and 4) denying plaintiff’s motion to reconsider.
The Towing Companies assert the towing policy is a joint policy of the
commissioners and sheriff having the force and effect of law. The Towing
Companies contend the policy schemes are a joint effort because the
Commissioners and sheriff together promulgated the policies, the Commissioners
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then enacted the policies, and the sheriff enforced them. The essence of the
Towing Companies’ argument is that the permit and the geographic division
policies, which were coordinated efforts by the Board and the sheriff, each are a
law, a regulation, or have the force and effect of law and, thus, are preempted by
federal law. 4 At the outset, we should clarify that we view the geographic
division and permit policies as two distinct policies that act together, and we will
review them as such.
JURISDICTION
We unquestionably have jurisdiction to review the district court’s denial of
plaintiff’s preliminary injunction pursuant to 28 U.S.C. § 1292(a)(1), which
states, in relevant part, “the courts of appeals shall have jurisdiction of appeals
from ... [i]nterlocutory orders of the district courts ... refusing ... injunctions.”
When a district court’s interlocutory order expressly denies an injunction, the
order “fits squarely within the plain language of 28 U.S.C. § 1292(a)(1)” and is
immediately appealable. Utah State Dep’t of Health v. Kennecott Corp., 14 F.3d
1489, 1496 (10th Cir.), cert. denied, 513 U.S. 872 (1994).
4
We assume the Towing Companies’ counsel inadvertently violated Federal Rule
of Appellate Procedure 28(a)(5) and Tenth Circuit Rule 28, by failing to include, in
appellant’s brief, a statement of the issues presented for review.
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We have jurisdiction to review the district court’s final order granting
partial summary judgment to defendants under 28 U.S.C. § 1291 and Rule 54(b).
The denial of a motion for summary judgment is generally not a final, appealable
decision under 28 U.S.C. § 1291. Lee v. Nicholl, 197 F.3d 1291, 1297 (10th Cir.
1999); but see Rose v. Uniroyal Goodrich Tire Co., 219 F.3d 1216, 1221 n.3 (10th
Cir. 2000). As is the case here, however, the denial of partial summary judgment
becomes appealable under 28 U.S.C. § 1291 when it is accompanied by a final
order granting a cross-motion for partial summary judgment. See Stroehmann
Bakeries, Inc. v. Local 776, Int’l Brotherhood of Teamsters, 969 F.2d 1436, 1440
(3d Cir.), cert. denied, 506 U.S. 1022 (1992); see also Abend v. MCA, Inc., 863
F.2d 1465, 1482 (9th Cir. 1988). In this instance, the district court certified as a
final order the granting of the Commissioner’s cross-motion for partial summary
judgment, thus giving us jurisdiction. Because we have jurisdiction to review the
district court’s denial of the Towing Companies’ motions for preliminary
injunction and partial summary judgment, and the grant of the Commissioner’s
partial summary judgment, we have jurisdiction to review the district court’s
motion for reconsideration. Having established our jurisdiction, we proceed to
the merits of the case.
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STANDARD OF REVIEW
“The standard of review for a denial of a motion for reconsideration
depends on the nature of the underlying decision.” Johnson v. Thompson, 971
F.2d 1487, 1498 (10th Cir.), cert. denied, 507 U.S. 910 (1993). In this case, the
motion for reconsideration was based on the district court’s preliminary
injunction and partial summary judgment rulings. Although we review the district
court’s denial of a preliminary injunction for an abuse of discretion, the
underlying preemption determination is reviewed de novo. St. Thomas-St. John
Hotel & Tourism Ass’n, Inc. v. Government of the United States Virgin Islands,
218 F.3d 232, 235 (3d Cir. 2000); see also Hawkins v. City & County of Denver,
170 F.3d 1281, 1292 (10th Cir.), cert. denied, 528 U.S. 871 (1999). “An abuse of
discretion occurs only when the trial court bases its decision on an erroneous
conclusion of law or where there is no rational basis in the evidence for the
ruling.” Hawkins, 170 F.3d at 1292 (quotation marks and citation omitted).
We review the district court's grant of summary judgment de novo, applying
the same legal standards used by that court. Charter Canyon Treatment Ctr. v.
Pool Co., 153 F.3d 1132, 1135 (10th Cir. 1998). Summary judgment should not
be granted unless the evidence, viewed in the light most favorable to the party
opposing the motion, shows there are no genuine issues of material fact and the
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moving party is due judgment as a matter of law. Id.; Fed. R. Civ. P. 56(c).
“Where, as here, the parties file cross motions for summary judgment, we are
entitled to assume that no evidence needs to be considered other than that filed by
the parties, but summary judgment is nevertheless inappropriate if disputes remain
as to material facts." 5 James Barlow Family Ltd. Partnership v. David M.
Munson, Inc., 132 F.3d 1316, 1319 (10th Cir. 1997), cert. denied, 523 U.S. 1048(1998). The Towing Companies admit no material issues of fact are in dispute;
our review is limited to whether the towing policies, as a matter of law, constitute
a law, regulation, or have the force and effect of law.
DISCUSSION
Preemption Principles
The Supremacy Clause of the United States Constitution provides that the
laws of the United States are “the supreme Law of the Land; ... any Thing in the
5
In addition to the filed papers we will examine the oral testimony from the
preliminary injunction hearing. “While the use of oral testimony on summary judgment
motions is not improper, ... the determinations made in ruling on summary judgment
materials and such testimony are not findings reviewable on the clearly erroneous
standard of Rule 52(a), but are reviewed under Rule 56(c) to ascertain whether there is an
absence of any genuine issue as to any material fact and whether the movant was entitled
to judgment as a matter of law.” Riley v. Brown & Root, Inc., 896 F.2d 474, 477 n.5 (10th
Cir. 1990). Thus, contrary to the Sheriff Stites’ assertion in his brief, we do not examine
the trial court’s ruling under the “clearly erroneous” standard, despite the fact the trial
court conducted an evidentiary hearing. Id. at 476.
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Constitution or Laws of any state to the Contrary notwithstanding.” U.S. Const.
Art. VI, cl. 2. In any preemption analysis, congressional intent is the “‘ultimate
touchstone.’” Tocher v. City of Santa Ana, 219 F.3d 1040, 1045 (9th Cir. 2000)
(quoting Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516 (1992)), petition for
cert. filed, (U.S. Nov. 29, 2000) (No. 00-916). Federal law preempts state law in
three circumstances: (1) Congress explicitly defines the extent to which the
enacted statute preempts state law; (2) state law actually conflicts with federal
law; or (3) state law attempts to regulate “conduct in a field that Congress
intended the Federal Government to occupy exclusively.” Choate v. Champion
Home Builders Co., 222 F.3d 788, 792 (10th Cir. 2000) (citing English v. General
Elec. Co., 496 U.S. 72, 78-79 (1990)). “Congress’ enactment of a provision
defining the pre-emptive reach of a statute implies that matters beyond that reach
are not pre-empted.” Cipollone, 505 U.S. at 517.
Interstate Commerce Commission Termination Act § 14501(c)
In 1994, Congress enacted the Federal Aviation Administration
Authorization Act (“Aviation Act”), as amended by the Interstate Commerce
Commission Termination Act § 14501(c), in order to deregulate the motor carrier
industry nationwide. Tocher, 219 F.3d at 1046. Congress intended the ICCTA,
like the Aviation Act, to broadly preempt state and local regulation, with an
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exemption for the state’s authority to regulate motor vehicle safety. 49 U.S.C.
§ 14501(c)(2)(A); see R. Mayer of Atlanta, Inc. v. City of Atlanta, 158 F.3d 538,
541 (11th Cir. 1998), cert. denied, 526 U.S. 1038 (1999). The ICCTA express
preemption language relevant to this appeal provides:
General Rule.– Except as provided in paragraphs (2) and (3), a
State, political subdivision of a State, or political authority of 2 or
more States may not enact or enforce a law, regulation or other
provision having the force and effect of law related to a price, route,
or service of any motor carrier ... with respect to the transportation of
property.
49 U.S.C. § 14501(c)(1) (emphasis added). It is apparent from the plain language
of the statute the threshold issue before this court is whether the two towing
policies are “laws, regulations or other provisions having the force and effect of
law.”
The Supreme Court has shed some light, in dicta, on similar preemption
language. According to the Court, “the word series ‘law, ... regulation ... or other
provision’ ... ‘connotes official, government-imposed policies, not the terms of a
private contract.’” The phrase “‘having the force and effect of law’ is most
naturally read to ‘refe[r] to binding standards of conduct that operate irrespective
of any private agreement.’” American Airlines, Inc. v. Wolens, 513 U.S. 219, 229
n. 5 (1995) (interpreting the preemption clause of the Airline Deregulation Act of
1978 which contains similar preemption language to the ICCTA). “[T]his court
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considers itself bound by Supreme Court dicta almost as firmly as by the Court’s
outright holdings, particularly when the dicta is recent and not enfeebled by later
statements.” Gaylor v. United States, 74 F.3d 214, 217 (10th Cir.), cert. denied,
517 U.S. 1211 (1996). We find the Court’s dicta construing the preemption
clause in the Airline Deregulation Act instructive in determining whether the
geographic division or the permit towing policies rise to the level of “law,
regulation, or having the force and effect of law.”
Geographic Division Policy
After reviewing the record, we hold the Towing Companies failed to show,
as a matter of law, that the geographic division policy is a law, regulation, or has
the force and effect of law.
The Towing Companies submitted the minutes from the Board’s February
1998, regular session as evidence of the Board’s participation and acquiescence in
adoption of the geographic division policy. The details were sparse, but the
minutes mentioned that Sheriff Stites and the Board members met in a brief
executive session, and “as a result of the executive session the commission
reported that from now on towing services for the county will be split from east
and west.” The fact the commissioners announced the adoption of the geographic
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division policy after an executive session does not de facto establish the policy as
a law or regulation or imbue the policy with the force and effect of law. In fact,
it suggests the opposite conclusion because, as Chairman Read acknowledged in
his deposition, the Board members are “prohibited by law from taking any action
in an executive session.” The Towing Companies have failed to produce evidence
showing the Commissioners took any action beyond publicly announcing Sheriff
Stites’ policy.
Even if we assume, without deciding, the geographic policy is attributable
to the Commissioners and not the sheriff, the Towing Companies still failed to
show the geographic division policy rises to the requisite level of formal
legislation required by K.S.A. § 19-101a. The Towing Companies suggest the
Commissioners used home rule authority because Mr. Read, the Linn County
Commissioner Chairman, suggested the geographic division policy was enacted by
the Commissioners in a “consensus agreement” pursuant to their home rule
powers. Chairman Read’s testimony, however, is inconsistent because he also
attributes the geographic division policy to the sheriff, rather than the
Commissioners. In this case, the Chairman’s statement the home rule powers
were used is not dispositive because we are entitled, if not obligated, to review
the Commission’s actual compliance with K.S.A. § 19-101a.
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Kansas law articulates precise statutory requirements for counties to pass
effective legislation under the counties’ home rule authority:
(a) The board of county commissioners may transact all county
business and perform all powers of local legislation and
administration it deems appropriate, subject only to the following
limitations, restrictions or prohibitions:
....
(b) Counties shall apply the powers of local legislation granted
in subsection (a) by resolution of the board of county commissioners.
If no statutory authority exists for such local legislation other than
that set forth in subsection (a) ..., such local legislation shall become
effective upon passage of a resolution of the board and publication in
the official county newspaper.
K.S.A. § 19-101a(a-b). The Towing Companies have put forth no evidence
showing the Commissioners passed a resolution and published in the official
county newspaper, as mandated in K.S.A. § 19-101a.
The Towing Companies assert that the Commissioner’s abidance with the
K.S.A. § 19-101a statutory requirements is not necessary because the
Commissioners can enact a law or regulation under K.S.A. § 19-212.
Specifically, K.S.A. § 19-212 states: “The board of county commissioners of
each county shall have the power, at any meeting: ... Sixth. To represent the
county and have the care of the county property, and management of the business
and concerns of the county, in all cases where no other provision is made by law.”
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This provision, unlike K.S.A. § 19-101a, has no express resolution or publication
requirement. The Towing Companies’ argument is not persuasive.
By the plain language of the statute, K.S.A. § 19-212 is appropriately
invoked by the Board of County Commissioners when managing county property
and internal business. Our decision that K.S.A. § 19-212 is not applicable in this
instance is supported by the Kansas Attorney General’s opinion. See Kan. Att’y
Gen. Op. No. 81-146, 1981 WL 15647 at *1 (Kan. A.G. 1981) (suggesting
publication is not required when a county adopts a personnel manual for county
employees). According to the Attorney General, K.S.A. § 19-212 is a
“delegation[] of authority to administer [not legislate] county business; to handle
its day to day affairs.” Id. at *2. In contrast, K.S.A § 19-101a accords legislative
and administrative powers, “and may be looked to primarily when exercising the
general police powers of the county.” Id. It is common sense that if a policy is to
be considered an official “law” or “regulation” it must be a matter of local
legislation passed pursuant to K.S.A § 19-101a, rather than a mere day-to-day
administrative matter that relates to county property and business. For this
reason, we hold K.S.A. § 19-212 is inapplicable, the Towing Companies made no
showing the Commissioners invoked their home rule authority pursuant to K.S.A
§ 19-101a, and, therefore, the geographic division policy is not a law or
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regulation.
The Towing Companies further failed to show the geographic division
policy has the “force and effect of law.” There is no evidence in the record to
suggest the geographic division policy has a guideline or “standard” that binds the
sheriff’s conduct. See United Airlines, 513 U.S. at 229 n.5. For instance, the
sheriff suffers no official repercussion or reprimand for violating the geographic
division policy, and, in fact, there is no evidence to suggest the sheriff can not
unilaterally change the policy, as he had done once in the past. The Towing
Companies’ contention the “county officials have acted as if the tow policy is
valid” is simply insufficient to demonstrate formal regulation and control over the
parties’ conduct. In sum, the tow operators could still tow in the county
regardless of the geographic division of the county, and nothing would happen
either to the operator or to the sheriff if either party violated the policy. Thus, it
is our conclusion the geographic division policy does not amount to a law, a
regulation, or have the force and effect of law; accordingly, the geographic
division policy is not preempted. For this reason, we affirm the district court’s
grant of partial summary judgment for Commissioners and affirm the district
court’s denial of partial summary judgment for the Towing Companies on the
geographic division policy.
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Permit Policy
The permit policy is a different creature, and presents a closer question.
Before considering the merits of the towing permit policy, however, we must
address whether the Towing Companies have standing to raise this claim.
To show Article III standing, a plaintiff has the burden of proving: (1) he
or she suffered an "injury-in-fact," (2) a causal relationship between the injury
and the challenged conduct, and (3) the injury likely will be redressed by a
favorable decision. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).
“‘Past exposure to illegal conduct does not in itself show a present case or
controversy regarding injunctive relief ... if unaccompanied by any continuing,
present adverse effects.’” Facio v. Jones, 929 F.2d 541, 545 (10th Cir. 1991)
(quoting O’Shea v. Littleton, 414 U.S. 488, 495-96 (1974)).
The Commissioners assert the Towing Companies lack standing to
challenge the permit policy because the Towing Companies were not denied a
regular size tow truck permit or the opportunity to perform a tow due to a lack of
a permit. According to the Commissioners, the Morses in particular lack standing
to challenge the denial of their large tow truck permit because they attempted to
acquire a county permit on behalf of an out-of-county operator. Nevertheless, for
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purposes of this opinion, we will assume, without deciding, all appellants in this
case have standing to assert this claim. See generally Gaylor v. United States, 74
F.3d at 216. We assume the Towing Companies have standing because the record
shows the Towing Companies continue to be affected by the application of the
permit policy and have expressed an interest in operating a towing business or
being placed on the sheriff’s non-preference towing list.
On the merits, the district court held the towing policy does not, as a matter
of law, amount to a law, a regulation, or have the force and effect of law. After
reviewing the record, we agree with the district court that the Towing Companies
have failed to show the permit policy is an “official, government-imposed policy”
enacted pursuant to the county’s home rule authority. See United Airlines, 513
U.S. at 229 n.5; see also K.S.A. § 19-101a.
To prove the permit policy has the force and effect of law, the Towing
Companies cite to the December 1997 Board of County Commissioner’s minutes.
This evidence, however, is insufficient because the minutes do not show or even
hint that the Commissioners passed a resolution and published in the official
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county newspaper pursuant to K.S.A. § 19-101a. 6 The minutes expressly state the
county counselor “reported” a temporary moratorium on non-preference tow calls
and a forthcoming permit policy. Indeed, at the time the county counselor
announced the policy, the permit form had not yet been designed. Thus, for the
same reasons the geographic policy does not constitute a law or regulation, we
likewise hold as a matter of law the informal permit policy fails to amount to a
law or regulation.
We are also not convinced the permit policy, as a matter of law, has the
force and effect of law. The permit form clearly requires the applicant to provide
personal and tow truck information, tender a copy of the inspection report, supply
the location of the storage area, and complete and sign the permit form. After the
applicant completes the form, the sheriff and county commission chairman must
approve and sign the permit form before the applicant can receive non-preference
calls from the sheriff’s department.
6
The record does not suggest the Commissioners passed the permit policy
pursuant to a resolution. Chairman Read testified the Commissioners enacted the policy
pursuant to a “consensus agreement,” but such an informal agreement made in an
executive session fails to rise to a resolution, particularly in light of Chairman Read’s
admission the Commissioners are prohibited from taking any action in an executive
session. The December 1997 minutes, from the public meeting, fail to mention the
Commissioners passed a resolution or even voted on the permit policy.
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It appears the permit form, however, is a mere formality that requires no
more from the tow operators than was previously required by law. Under the
permit form, the applicant must have current Kansas Corporate Commission
licensing and a Department of Transportation inspection, but such requirements
were already in effect before the permit form was promulgated. Moreover, the
applicant must have a legal, properly zoned storage area, but Linn County had
local zoning ordinances regulating the storage of impounded vehicles already in
effect before the permit policy was announced. For these reasons, we conclude
the permit policy is a pro forma application that merely consolidates the previous
licensing, inspection, and storage information onto one form.
Even if the permit form is more than pro forma, the requirement that the
sheriff and chairman approve and sign each application does not imbue the permit
policy with the force and effect of law. Like the geographic division policy, it is
evident the permit policy fails to articulate a “binding standard of conduct” for
the sheriff or county commission chairman. See United Airlines, 513 U.S. at 229
n.5. Neither person suffers a repercussion if he fails to approve and sign the
permit form, or violates the policy by under- or over- enforcement. Based on the
absence of any evidence suggesting the permit policy imposed a binding standard
of conduct on the sheriff or chairman, we hold the permit policy, as a matter of
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law, does not have the force and effect of law. Accordingly, the permit policy is
not preempted by the ICCTA.
In summary, for the reasons stated, we AFFIRM the district court’s grant
of partial summary judgment for Commissioners; we AFFIRM the denial of the
Towing Companies’ partial summary judgment motion; we AFFIRM the denial of
the Towing Companies’ preliminary injunction; and we AFFIRM the denial of
the Towing Companies’ motion for reconsideration.
Entered by the Court:
WADE BRORBY
United States Circuit Judge
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No. 99-3192, Martin v. Stites
BRISCOE, Circuit Judge, concurring and dissenting:
I concur in part and dissent in part. I agree with the majority that the
geographic division policy implemented by Sheriff Stites does not amount to a
law, regulation, or other provision having the force and effect of law, and
therefore is not preempted by 49 U.S.C. § 14501(c)(1). I disagree, however, with
the majority’s similar assessment of the permit policy. In my view, the permit
policy is preempted by § 14501(c)(1) because it has the force and effect of law
and is “related to a price, route or service” of the plaintiffs. I would reverse and
remand the case to the district court to determine whether, as asserted by
defendants, the permit policy is saved by the safety exception set forth in
§ 14501(c)(2)(A).
Section 14501(c)(1) prohibits states and political subdivisions thereof from
“enact[ing] or enforc[ing] . . . law[s], regulation[s], or other provision[s] having
the force and effect of law related to a price, route, or service of any motor carrier
. . . with respect to the transportation of property.” 49 U.S.C. § 14501(c)(1). As
the majority correctly observes, the threshold question in applying § 14501(c)(1)
is whether the policy at issue constitutes a “law, regulation, or other provision
having the force and effect of law.” The policy at issue, i.e., the permit policy,
was allegedly passed pursuant to a resolution of the Linn County Board of County
Commissioners requiring any towing service operator contacted by sheriff’s office
dispatchers to have a “permit.” App. at 411 (indicating that the permit policy was
enacted pursuant to the consensus agreement of the Board pursuant to the home
rule powers allotted under Kansas law). It is unclear from the record whether the
Board complied precisely with the terms of the Kansas home rule powers statute
by publishing notice of the resolution “in the official county newspaper.” Kan.
Stat. Ann. § 19-101a(b). Thus, I agree with the majority that the Towing
Companies have failed to show the permit policy is an official law or regulation
enacted pursuant to the county’s home rule authority.
The question remains, however, whether the permit policy “has the force
and effect of law.” In deciding this question, the majority correctly notes that the
phrase “having the force and effect of law,” as used in § 14502(c)(1), “is most
naturally read to ‘refe[r] to binding standards of conduct that operate irrespective
of any private agreement.’” American Airlines, Inc. v. Wolens, 513 U.S. 219, 229
n.5 (1995) (interpreting identical phrase used in the Airline Deregulation Act of
1978). Applying this definition, the majority concludes that the permit policy
does not have the force and effect of law because (1) the permit application “is a
mere formality that requires no more from the tow operators than was previously
required by law,” Slip op. at 22, and (2) even though the sheriff and county
commission chairman must approve and sign each completed application,
“[n]either person suffers a repercussion if he fails to approve and sign [a
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particular] permit form, or violates the policy by under- or over-enforcement.”
Id. at 23.
I disagree with the majority’s conclusions. Even though the majority
characterizes the permit form as a “mere formality,” the fact is that the permit
policy imposes binding standards of conduct on towing service operators
interested in receiving business from the county (i.e., non-preference calls from
the sheriff’s dispatchers). If towing service operators do not complete the permit
form, they will lose the towing business generated by non-preference calls from
the sheriff’s dispatcher. Our focus in addressing § 14501(c)(1) should be upon
the permit policy’s effect upon the conduct of towing service operators, and not
its effect upon the conduct of the sheriff and county commission chairman. By
downplaying the effect of the permit policy upon towing service operators, the
majority acts in contravention of the intended purpose of the Interstate Commerce
Commission Termination Act (to preempt state regulation of intrastate motor
carrier activities) and paves the way for other states or political subdivisions to
impose their own unique procedural requirements on towing service operators or
other motor carriers.
Because the permit policy, in my view, has the force and effect of law, it is
expressly preempted by § 14501(c)(1) if it is “related to a price, route, or service”
of the plaintiffs. There is no dispute that the permit policy does not expressly
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refer to, or have a significant economic effect upon, towing service rates. It is
apparent, however, that the permit policy expressly refers to towing services. On
its face, the policy applies solely to towing service operators and provides that
such operators must have a county-authorized permit before they are eligible to be
placed on the county’s referral list and receive calls for towing service from
sheriff’s office dispatchers. Although the permit policy does not, as pointed out
by the majority, impose any new substantive standards upon towing service
operators, this appears to be irrelevant for preemption purposes in light of
Morales v. Trans World Airlines, Inc., 504 U.S. 374, 384 (1992) (construing in a
broad fashion similar “related to” language in the Airline Deregulation Act of
1978 and holding that it results in preemption of any state or local law that has a
“connection with or reference to” airline rates, routes, or services). Thus, the
permit policy runs afoul of § 14501(c)(1).
Defendants assert that even if the permit policy is otherwise preempted by §
14501(c)(1), it is saved by § 14501(c)(2)(A), which provides that § 14501(c)(1)
“shall not restrict the safety regulatory authority of a State with respect to motor
vehicles.” 49 U.S.C. § 14501(c)(2)(A). This argument raises a factual issue
which requires remand to the district court. There appears to be a genuine factual
dispute concerning whether the permit policy was actually implemented by the
Board for safety reasons. For example, contrary to the defendants’ current
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assertions on appeal, defendant Read, one of the Linn County Commissioners,
testified that the permit requirement was implemented solely due to concerns
about the county’s potential liability if it contacted and utilized a towing service
that had not satisfied otherwise applicable state and federal requirements. App. at
414. Assuming, arguendo, the permit policy was adopted for safety reasons, there
are also two significant legal questions that must be resolved. First, there is the
question of whether § 14501(c)(2)(A)’s safety exception applies to regulations
implemented by political subdivisions of a state (as opposed to regulations
implemented by the state itself). There is currently a split of opinion concerning
whether § 14501(c)(2) applies to laws and regulations implemented by political
subdivisions of a state. Some courts have concluded that the exception applies
only where the safety regulation at issue was implemented by the state itself. See
R. Mayer of Atlanta, Inc. v. City of Atlanta, 158 F.3d 538, 545-46 (11th Cir.
1998) (“[W]e view Congress’ omission of a reference to a state’s political
subdivisions from § 14501(c)(2)(A) as a manifestation of Congress’ intent that
municipal safety and insurance regulations are not exempted from the preemptive
scope of § 14501(c)(1).”), cert. denied, 526 U.S. 1038 (1999); Petrey v. City of
Toledo, 61 F. Supp. 2d 674, 680 (N.D. Ohio 1999) (“[T]he exception in
§ 14501(c)(2)(A) limits the authority of a state to delegate its regulatory authority
over tow truck operators to local or municipal governments.”). Other courts have
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concluded that the exception applies to safety regulations enacted by political
subdivisions if the state has delegated its safety regulatory authority to those
subdivisions. See Ace Auto Body & Towing, Ltd. v. City of New York, 171 F.3d
765, 775-76 (2d Cir.) (“49 U.S.C. § 14501(c)(2)(A) does not limit the authority of
a state to delegate its towing regulatory authority to local or municipal
governments.”), cert. denied, 528 U.S. 868 (1999); Harris County Wrecker
Owners v. City of Houston, 943 F. Supp. 711, 727 (S.D. Tex. 1996) (“The court
concludes that 49 U.S.C. § 14501(c)(2)(A) permits municipalities to enact safety
regulations related to a price, route, or service of a tow truck if a State has
redelegated its regulatory authority to its political subdivisions.”). Finally,
assuming, arguendo, that § 14501(c)(2) is applicable to safety regulations adopted
by political subdivisions of a state, there is the question of whether the State of
Kansas has delegated its towing regulatory authority to counties and other
political subdivisions in the state.
While I agree with and concur in the majority’s affirmance of the district
court’s rulings on the geographic division policy, I would reverse the district
court’s grant of summary judgment in favor of defendants on plaintiffs’ claim that
the permit policy is preempted by § 14501(c)(1) and remand for further
consideration of defendants’ argument that the permit policy is saved by the
safety exception set forth in § 14501(c)(2)(A). For the same reasons, I would
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reverse and remand the district court’s denial of plaintiff’s motion to
preliminarily enjoin the permit policy.
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