Truckers Group Seeks Relief on Port Concessions

The American Trucking Associations with the support of its Intermodal Motor Carriers Conference filed suit in the U.S. District Court in California challenging the port "Concession Plans" as approved by the cities of Los Angeles and Long Beach and their harbor commissions. The groups filed the suit in late July.

The plans will limit access to the ports to only those trucking companies that have entered into concession contracts approved by the port program administrator.

The concession plans impose a broad range of operational requirements that create a regulatory environment similar to state intrastate economic regulation. The ports have acknowledged that these intrusive regulatory systems will result in far fewer trucking companies being able to service the ports, reducing competition.

"We firmly believe that these concession programs unlawfully re-regulate the port trucking industry to the detriment of motor carriers, shippers, and the businesses and consumers that depend on the products that are handled at those ports," said ATA President and Chief Executive Officer Bill Graves. "We are particularly concerned with the Port of Los Angeles' concession requirement that will lead to a complete ban of the use of independent contractor/owner operator drivers in servicing that port's operations within five years. That requirement, which has nothing to do with the clean air goals of the ports' Clean Truck Program, threatens a well-established trucking industry operational practice that provides efficiencies and the flexibility needed for the trucking industry to effectively serve our customers."

Graves emphasized that the litigation is not aimed at and should not interfere with the ports' clean air efforts. "Despite the additional costs that our industry will incur, we strongly support the ports' efforts to reduce truck emissions, and our lawsuit does not challenge any aspect of those efforts," Graves said.

"We are challenging only the intrusive and unnecessary regulatory structure being created under the Concession Plans," IMCC Executive Director Curtis Whalen said. "As Congress recognized when it created price, routes, and services pre-emption, regulatory schemes like the Concession Plans burden interstate commerce and are bad for the American economy."

In its filing, ATA specifically asserts that the ports' actions violate the federal statutory provision (49 U.S.C. § 14501) that prohibits states or their political subdivisions from enacting or enforcing a legal requirement that is "related to a price, route, or service of any motor carrier." The filing points to a host of regulatory requirements (for example, submission of truck-maintenance; safety and parking plans; equipment marking and tracking; financial oversight; routing mandates; and periodic reviews and audits) that will dramatically affect a motor carrier's operations at the ports in terms of price, routes, and services.

The filing also relies heavily on the U.S. Supreme Court's recent unanimous ruling interpreting that federal pre-emption provision. Rowe v. New Hampshire Motor Transport Ass'n, 128 S.Ct. 989, 995 (2008). Citing language in that case, the trucking industry papers argue that laws like the Concession Plans that substitute "governmental commands for 'competitive market forces' in determining the services that a motor carrier will provide" are pre-empted.

In response to the lawsuit, the ports of Los Angeles and Long Beach filed their opposition on Aug. 21, in the U.S. District Court in Los Angeles.

The ports' response demonstrates that the requested injunction is without legal basis for three reasons:

• First, the statute that the ATA relies upon does not apply to the special tidelands property on which the ports are located. The U.S. Supreme Court has previously decided that the tidelands were granted to California directly under the U.S. Constitution and subsequently granted to the cities. Therefore, absent explicit congressional intent -- which is not present in the federal statute relied upon by the ATA – a federal statute will not interfere with the ports' rights to manage and control these sovereign lands as they see fit.

• Second, the statute does not apply to actions taken by the ports as landholders and as "commercial enterprises … in the business of providing world-class port facilities and services." The ports rely on many U.S. Supreme Court and Ninth Circuit cases which recognize that the "Market Participant Doctrine" allows programs such as the Clean Truck Program concession requirement.

• Third, the statute clearly does not apply to port actions directed to the safety and security of the ports, which are also among the major goals of the Clean Truck Program concession requirement.

The ports' opposition also emphasizes that the ATA's alleged injuries are merely financial in nature and, therefore cannot justify the extraordinary action of the preliminary injunction it seeks. Furthermore, these claimed financial injuries are more than outweighed by the public health and security interests of those who work at and live near the ports.

Port of Los Angeles Executive Director Geraldine Knatz said, "I believe that a substantial delay in the implementation of the Clean Truck Program will have dire consequences for the air quality in the area in and around the port, for the people who work at the port or live nearby or near the transportation corridors used by trucks serving the port, and for the future of the Port as an enterprise." "The ATA lawsuit directly attacks the ports' efforts to dramatically reduce truck-related pollution and improve the safety, security and efficiency of port operations," said Port of Long Beach Executive Director Richard Steinke. "We strongly believe that our plan is lawful, and we will vigorously oppose any action that will delay the Clean Truck Program."

The court will hold a hearing for preliminary injunction on Sept. 8 and a decision is expected sometime after that date. The ports are committed to moving forward with the Clean Truck Program as planned on Oct. 1.

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