Supreme Court Partially Upholds ATA in L.A. Port Case

UPDATED---The Supreme Court unanimously ruled that the Port of Los Angeles may not impose the placarding and parking requires of its concession plan on trucking companies.

This in effect upholds part of the position American Trucking Associations took in pushing for the high court’s review of the port’s concession agreement.

The court declined to rule on a second aspect of the matter, concerning how the port enforces its financial-capacity and truck maintenance requirements.

ATA has been pursuing the issues through lower courts since 2008, when the Port of Los Angeles instituted a Clean Truck Program under which drayage carriers must join a concession agreement in order to provide service.

The high court upheld ATA’s contention that the Federal Aviation Administration Authorization Act exempts carriers from the off-street parking and placard provisions of the agreement.

Those provisions require carriers to submit an off-street parking plan, and to mount placards with a phone number so the public can report concerns about safety or the environment.

The issue turned on whether or not the requirement is an act of regulatory authority, which the FAAA would forbid.

Justice Elena Kagan, writing for the unanimous court, said the port was exercising “classic regulatory authority” when it imposed the requirement.

The FAAA “expressly preempts the agreement’s placard and parking requirements,” she wrote.

“(The Port) forced terminal operators – and through them, trucking companies – to alter their conduct by implementing a criminal prohibition punishable by imprisonment.

“That counts as action ‘having the force and effect of law’ if anything does.”

ATA also contended that under a 1954 Supreme Court decision, Castle v. Hayes Freight Lines, the port cannot suspend or revoke a carrier’s access.

The Supreme Court did not take a position on this issue.

Kagan wrote that Castle does not prevent a state from taking a noncompliant truck off the road, and said there is no basis for finding that the port will use the concession agreement to do so.

ATA President and CEO Bill Graves said in a statement that the association is gratified by the decision.

“The decision is sure to send a signal to any other cities who may have been considering similar programs which would impermissibly regulate the port trucking industry,” he said.

A copy of the Supreme Court’s decision is available here.