State of New Hampshire v. Wayne A. Bickford & a.

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THE SUPREME COURT OF NEW HAMPSHIRE
___________________________
9th Circuit Court - Manchester District Division
No. 2013-796
THE STATE OF NEW HAMPSHIRE
v.
WAYNE A. BICKFORD & a.
Argued: October 9, 2014
Opinion Issued: May 19, 2015
Joseph A. Foster, attorney general (Lisa L. Wolford, assistant attorney
general, on the brief and orally), for the State.
Brennan, Caron, Lenehan & Iacopino, of Manchester, (Michael J.
Iacopino and Jenna M. Bergeron on the brief, and Mr. Iacopino orally), for the
defendants.
HICKS, J. The defendants, Gerald Mandelbaum, Christopher Lajoie,
Nicholas Meuse, Michael Garrity, and Wayne Bickford, were charged with
operating a taxicab business without a license from the City of Manchester
(City). The Circuit Court (Michael, J.) granted the defendants’ motion to
dismiss on federal preemption grounds. See 49 U.S.C. §§ 14501(a), (d) (2012).
The State appeals, arguing that the local ordinances are not preempted by
federal law and that the circuit court has jurisdiction over the charges. We
reverse and remand.
The following facts are supported by the record or undisputed by the
parties. Mandelbaum owns Amoskeag Airport Service (AAS), a sole
proprietorship in Manchester, and Amoskeag Black Car (ABC), a registered
trade name for a subdivision of AAS. Mandelbaum operates these businesses
pursuant to a motor carrier permit issued by the United States Department of
Transportation’s Federal Motor Carrier Safety Administration (FMCSA) that, he
asserts, grants him the authority “to engage in the transportation as a common
carrier of passengers, in charter and special operations, by motor vehicle in
interstate or foreign commerce.” Mandelbaum does not, however, hold a City
license to operate a taxicab service.
Bickford, Garrity, Lajoie, and Meuse are drivers for AAS and ABC. In
March and April of 2013, they were each cited by the Manchester Police for
operating a taxicab service in violation of the City’s business and taxicab
licensing ordinances (City Ordinances). See Manchester, N.H., Rev.
Ordinances title XI, ch. 110, § 110.02; id. title XI, ch. 118, §§ 118.01 et seq.
(2014). On two occasions, Mandelbaum was also issued a citation for the same
reasons.
On July 8, 2013, the defendants moved to dismiss the citations, arguing
that: (1) federal law preempts the City Ordinances; (2) Mandelbaum’s FMCSA
certification divests the City of jurisdiction to regulate AAS or ABC; and (3)
neither AAS nor ABC constitutes a taxicab service as defined by statute or
ordinance. The State objected and, after a hearing, the trial court granted the
defendants’ motion to dismiss “without prejudice to the State’s right to petition
the FMCSA for further review of the defendants’ activities.” The State filed a
motion to reconsider, which was denied. This appeal followed.
Although the parties raise numerous issues, we need only address the
following: (1) whether federal law preempts the City Ordinances; and (2)
whether federal law requires the State to first bring its complaints before the
FMCSA. Because resolution of these issues requires both statutory
interpretation and a determination of federal preemption, we review the trial
court’s decision de novo. Appeal of Bretton Woods Tel. Co., 164 N.H. 379, 386-
87 (2012); State v. Merriam, 150 N.H. 548, 549 (2004). When interpreting a
statute, we first look to the language of the statute itself, and, if possible,
construe that language according to its plain and ordinary meaning. Pelkey v.
Dan’s City Used Cars, 163 N.H. 483, 487 (2012), aff’d, 133 S. Ct. 1769 (2013).
We do not read words or phrases in isolation, but in the context of the entire
statutory scheme. Id. When construing federal statutes, we construe them in
accordance with federal policy and precedent. Id.
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We first consider whether federal law preempts the City Ordinances.
State and local laws are preempted when: “(1) Congress expresses an intent to
displace state law; (2) Congress implicitly supplants state law by granting
exclusive regulatory power in a particular field to the federal government; or (3)
state and federal law actually conflict.” Disabilities Rights Center, Inc. v.
Comm’r, N.H. Dept. of Corrections, 143 N.H. 674, 676 (1999). The federal
preemption doctrine is based upon the Supremacy Clause of the United States
Constitution. U.S. CONST. art. VI, cl. 2; Arizona v. United States, 132 S. Ct.
2492, 2500 (2012); Appeal of Sinclair Machine Prod’s, Inc., 126 N.H. 822, 826
(1985). “Consideration of issues arising under the Supremacy Clause starts
with the assumption that the historic police powers of the States are not to be
superseded by Federal Act unless that is the clear and manifest purpose of
Congress.” Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516 (1992)
(quotation, brackets, and ellipsis omitted). “Accordingly, the purpose of
Congress is the ultimate touchstone of pre-emption analysis.” Id. (quotation
and brackets omitted).
The defendants do not argue that Congress expressly displaced state law
by enacting 49 U.S.C. §§ 14501(a) and 14501(d). Instead, they argue that
enforcement of the City Ordinances against them brings state and federal law
into conflict, and that when such conflict occurs state law must yield.
Specifically, they contend that “[f]ederal law clearly exempts taxicab services
from FMCSA regulation” and that “Mandelbaum’s business cannot be licensed
both under the FMCSA Certificate and local Manchester, NH taxicab
ordinances.” We disagree.
We first examine the federal statutory scheme upon which the
defendants rely. Title 49 U.S.C. §§ 13101 et seq. (2012) govern the federal
regulation of interstate transportation provided by motor carriers, water
carriers, brokers, and freight forwarders, and seek “[t]o ensure the
development, coordination, and preservation of a transportation system that
meets the transportation needs of the United States.” 49 U.S.C. § 13101(a). In
overseeing the transportation of motor carriers of passengers, the federal
government endeavors “to cooperate with the States on transportation matters
for the purpose of encouraging the States to exercise intrastate regulatory
jurisdiction in accordance with the objectives of [49 U.S.C. §§ 13101-14916].”
Id. § 13101(a)(3)(A). To achieve these goals, Congress has vested the Secretary
of Transportation (Secretary) and the Surface Transportation Board (STB) with
jurisdiction “over transportation by motor carrier and the procurement of that
transportation, to the extent that passengers . . . are transported by motor
carrier” from one state to another or within a single state as long as the
transportation, in relevant part, crosses into another state. Id. § 13501(1).
Congress has directed the FMCSA to carry out the “duties and powers related
to motor carriers or motor carrier safety vested in the Secretary by” the statutes
here at issue. Id. § 113(f) (2012).
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Congress, however, explicitly denied the federal government jurisdiction
over “a motor vehicle providing taxicab service.” Id. § 13506(a)(2). Congress
has defined taxicab service to mean:
[P]assenger transportation in a motor vehicle having a capacity of
not more than 8 passengers (including the driver), not operated on
a regular route or between specified places, and that –
(A) is licensed as a taxicab by a State or local jurisdiction; or
(B) is offered by a person that –
(i) provides local transportation for a fare determined (except with
respect to transportation to or from airports) primarily on the basis
of the distance traveled; and
(ii) does not primarily provide transportation to or from airports.
Id. § 13102(22).
Federal law displaces the states’ ability to regulate the “scheduling of
interstate or intrastate transportation . . . provided by a motor carrier of
passengers . . . on an interstate route” and to regulate “the implementation of
any change in rates for such transportation . . . except to the extent that notice
. . . of changes in schedules may be required” for motor carriers subject to the
Secretary’s or the STB’s jurisdiction. Id. § 14501(a) (emphasis added). It also
displaces the states’ ability to enforce any law or regulation requiring a license
or imposing a fee on motor vehicles providing pre-arranged ground
transportation service if such service is within the jurisdiction of the Secretary
or the STB, “meets all applicable vehicle and intrastate passenger licensing
requirements of the State or States in which the motor carrier is domiciled or
registered to do business,” and is provided pursuant to a contract for
transportation from one state to a destination in another state or within a
single state but with an intermediate stop in another state. Id. § 14501(d);
Black Car Assistance Corp. v. New Jersey, 351 F. Supp. 2d 284, 289 (D.N.J.
2004) (holding that 49 U.S.C. § 14501(d) prohibits enforcing licensing or fee
requirements against non-resident providers of prearranged ground
transportation provided they satisfy the requirements of § 14501(d)); S. Rep.
No. 107-237, at 1 (2002) (“The purpose of this bill . . . is to prohibit a State, . . .
other than the home licensing State, from enacting or enforcing any law, rule,
or regulation requiring a license or fee on a motor vehicle that is providing
prearranged interstate ground transportation service.” (emphasis added)).
Here, again, the federal law explicitly exempts taxi services from the
jurisdiction of the Secretary. 49 U.S.C. § 14501(d)(3)(A). Federal law also
establishes the process that motor carriers must follow to register with the
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Secretary and the FMCSA, if they wish to provide interstate transportation
services. Id. § 13901(a); 49 C.F.R. § 385.301(a) (2014).
The plain language of these statutes requires a motor carrier engaging in
interstate commerce or transit to be within the jurisdiction of the Secretary
and, thus, the FMCSA; purely intrastate activities are left to state and local
authorities to regulate. See Leonard Express, Inc. v. United States, 298 F.
Supp. 556, 560 (W.D. Pa. 1969) (recognizing that a motor carrier cannot rely on
its federal certification to avoid compliance with state law when conducting
purely intrastate activities). Furthermore, Congress explicitly exempts taxicab
services from any federal jurisdiction. 49 U.S.C. §§ 13506(a)(2), 14501(d)(3)(A).
The exemption recognizes that taxicab services are inherently local in nature.
See Buck v. California, 343 U.S. 99, 102 (1952) (“The operation of taxicabs is a
local business. For that reason Congress has left the field largely to the
states.”); I.C.C. v. Miller, 360 F. Supp. 1167, 1170-71 (D.N.H. 1973) (finding
that federal law generally exempts taxicab services from federal regulation and
that “bona fide taxicab service” constitutes local transportation). Accordingly,
we conclude that federal law neither expressly nor implicitly preempts the City
Ordinances.
Nevertheless, when an actual conflict arises between state or local law
and federal law, state or local law is without effect to the extent that it conflicts
with federal law. Fidelity Federal Sav. & Loan Assn v. De La Cuesta, 458 U.S.
141, 153 (1982). “An actual conflict exists when it is impossible for a private
party to comply with both state and federal requirements or where state law
stands as an obstacle to the accomplishments and execution of the full
purpose and objective of Congress.” Disabilities Rights Center, 143 N.H. at 678
(quotation omitted). A motor carrier that provides taxicab service under a state
or local license would, generally, be exempt from federal regulation. 49 U.S.C.
§ 13506(a)(2) (exempting taxicab services from federal jurisdiction); 42 U.S.C.
§ 13902 (detailing how to register as a motor carrier subject to federal
jurisdiction). This exemption, however, is not without limits. See, e.g., I.C.C.
v. Mr. B’s Services, Ltd., 934 F.2d 117, 122 (7th Cir. 1991). The taxicab
services exemption does not extend to transportation provided by taxicabs that
is not inherently local. Id. Once the transportation ceases to be local in nature
or the provider bills itself as an interstate service, it falls within the jurisdiction
of the Secretary, the STB, and the FMCSA, and the provider must comply with
federal law to provide such transportation. See id.; see also Miller, 360 F.
Supp. at 1171 (concluding that a taxicab service cannot hold itself out as
providing interstate transportation without securing the necessary licenses
from the federal government). Accordingly, a taxicab service can be subject to
local regulation and still fall within the jurisdiction of the FMCSA.
Thus, the defendants’ FMCSA certification provides them with the
authority to carry passengers in interstate commerce, but it does not authorize
them to provide purely intrastate services that are unrelated to their interstate
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services. See Funbus Systems, Inc. v. C.P.U.C., 801 F.2d 1120, 1122, 1129
(9th Cir. 1986) (concluding that certificate issued by Interstate Commerce
Commission to operate in interstate commerce grants a limited authority to
operate along the same routes in intrastate commerce but does not grant the
certificate holder free rein to operate wholly unrelated intrastate services); East
West Resort Transp., LLC v. Binz, 494 F. Supp. 2d 1197, 1200 (D. Colo. 2007)
(noting that for intrastate transportation to qualify as interstate service subject
to federal regulation, thereby preempting regulation by the state, it “may not
operate independently of the interstate service, but instead must be conducted
as part of existing interstate service” (quotation omitted)). Federal law and
certification do not function as a shield to prevent the enforcement of local
regulation when the nature of the service provided is intrastate and unrelated
to the interstate services protected under federal law. See Trans Shuttle v.
Public Utilities Com’n, 89 P.3d 398, 400 n.3, 404 (Colo. 2004) (concluding that
federal law preempts local regulatory authority only with respect to a motor
carrier’s intrastate passenger transportation on same routes over which it
provides interstate transportation; intrastate activities that are independent of
the interstate activities are subject to local regulation).
Because the defendants have not shown that they cannot comply with
the requirements of both federal law and the City Ordinances, they have failed
to demonstrate that state and federal law actually conflict. See Disabilities
Rights Center, 143 N.H. at 678. Accordingly, we conclude that the trial court
erred in dismissing the case. If the trial court concludes that the defendants’
transportation service falls within the scope of the City Ordinances, they must
comply with the requirements of those ordinances.1
Finally, the defendants assert that the determination “of whether their
business activity falls within the authority granted to them by their federal
certificate requires the special competence of the issuing authority.” They
appear to argue that the primary jurisdiction doctrine justifies a stay of the
court proceedings and a determination of the issue by the FMCSA in the first
instance. See Reiter v. Cooper, 507 U.S. 258, 268 (1993) (noting that the
primary jurisdiction doctrine requires a trial court “to enable a ‘referral’ to the
agency, staying further proceedings so as to give the parties reasonable
opportunity to seek an administrative ruling,” particularly where the claim
“contain[s] some issue within the special competence of an administrative
agency”). However, as the State points out, the City’s enforcement action does
not “challenge the defendants’ compliance with their federal operating
authority”; rather, the dispositive issue here is whether the defendants’
activities constitute a taxicab service under the City Ordinances. Because this
is not an issue within the special competence of the FMCSA, the primary
jurisdiction doctrine is inapplicable.
1Because we so conclude, we need not address the defendants’ argument that the Manchester
Ordinances unconstitutionally burden interstate commerce.
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For all of the foregoing reasons, we conclude that the trial court erred in
dismissing the State’s charges.
Reversed and remanded.
DALIANIS, C.J., and CONBOY, LYNN, and BASSETT, JJ., concurred.
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