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Judge Upholds Controversial Port Plan to Ban Owner-Operators

August 27, 2010

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The U.S. District Court upheld the legality of controversial parts of the Port of Los Angeles' Clean Truck Program yesterday, which could open up the port truck drivers to unionization. But observers say there will likely be an appeal.


Last year, District Judge Christina Snyder granted the American Trucking Associations a preliminary injunction against certain concessions, including a ban on owner-operators at the port. While the ATA does support the Clean Truck Program's environmental goals, the association argued that the concession plan imposes operational requirements that create a regulatory environment similar to state intrastate economic regulation and is thus against federal law.

After hearing arguments earlier this year, Snyder Thursday ruled that although federal law prohibits state and local entities from regulating the rates, routes and services of motor carriers engaged in interstate commerce, the Port of Los Angeles can mandate certain requirements on truckers under a "market participant" exception to that law. That exception is applicable, she ruled, because the port adopted the concession agreement in the Clean Truck Program "as a business necessity."

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The Owner-Operator Issue

The heart of the argument lies in the decision by the Port of Los Angeles to require all drayage drivers to be employees of trucking companies, rather than owner-operators.

The LA port believes that the owner-operator business model simply cannot produce enough revenue to ensure that the truck owner will be able to afford a modern engine that meets federal clean air standards without ongoing financial assistance.

The Port of Long Beach has taken a different approach. Under a settlement agreement with ATA, it grants port access to owner-operators as well as drayage lines with employee drivers. Access is conditioned on a Registration Agreement that requires the carrier or owner-operator to abide by environmental, safety and security requirements.

Look for more details and analysis of this development from Washington Editor Oliver Patton Monday on Truckinginfo.com.


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