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This order and judgment is not binding precedent except under the doctrines of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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