Port of L.A. wins round in lawsuit, appeal anticipated

| 8/27/2010

A federal judge has ruled in favor of the Port of Los Angeles Clean Truck Program, although litigants – the American Trucking Associations – have said they plan to appeal the latest ruling in a two-year legal battle.

In 2008, the ports of Los Angeles and Long Beach each approved a Clean Truck Program that banned pre-1989 trucks from entering their ports in 2009. In January 2010, trucks with 1993 model year engines and older were banned. By 2012, only trucks meeting 2007 model year diesel engine emissions standards will be allowed at the ports.

The Port of Los Angeles’ program required companies wanting to work at the ports to employ their drivers, and included expensive taxi-style “concessionaire” fees, prompting a July 2008 lawsuit to overturn several portions of the program. The lawsuit has bounced between U.S. District Court in Los Angeles and the 9th Circuit Court of Appeals. 

On Thursday, Aug. 26, U.S. District Judge Christina Snyder ruled in favor of the port, including the Clean Truck Program’s employee-driver provision, off-site parking and other requirements on the basis that the Port is acting as a market participant and, as such, is not subject to the laws that pre-empt states or municipalities from regulating trucking activities.

“In cases of statutory pre-emption, the market participant doctrine is based on the proposition that ‘pre-emption doctrines’ apply only to state regulation,” Snyder wrote in her 57-page decision. “Therefore, if state action is propriety, rather than regulatory, such action is not generally subject to statutory pre-emption.”

While the Port of Los Angeles has sought to regulate drayage drivers, it hasn’t regulated long-haul trucking, and the port worked with OOIDA to create a Day Pass system that allows trucks engaged in long-haul to bypass the system.

“We have always appreciated the fact that Los Angeles and Long Beach aren’t attempting to regulate long-haul trucking,” said OOIDA Executive Vice President Todd Spencer. “However, the ports should recognize, as should large motor carriers, that if truckers were fairly compensated, we wouldn’t be having this conversation. Truckers are nickel and dimed to death and therefore can’t keep up with truck payments or repairs. Both of those parties have the power to change that without amending federal law.”

OOIDA has objected to expensive fees for port access and has pointed out underlying problems at ports that go beyond the scope of the Clean Truck Program.

Recently, OOIDA participated in a House Highways and Transit Subcommittee hearing evaluating the effectiveness of the Clean Truck Program when the issue of lease purchasing arose. Regulatory Affairs Director Joe Rajkovacz testified before the House panel and lambasted such schemes, which are prevalent not only at the ports but across the country.

“How did the drayage industry become so dominated by older trucks, and did the Clean Truck Program do anything to address that? Our response is – not really,” Rajkovacz said at the hearing.

“For owner-operators to be a vibrant part of the marketplace, federal regulations that are meant to protect them from unscrupulous practices by motor carriers need to be enforced,” Rajkovacz said then. “It’s about the leases between motor carriers and owner-operators.”

The leasing requirement “essentially isn’t enforced, and therefore we have no referee in the game when it comes to making sure drivers get the money to which they are entitled,” Rajkovacz said.

Spencer agreed, saying that federal leasing requirements, along with truck maintenance requirements, have never been observed at the ports.

“What has evolved is a very dysfunctional system that hasn’t helped safety or the environment,” Spencer said. “The net result is an extremely dysfunctional system that won’t be changed by simply throwing millions of dollars of tax money at it or by changing the status of drivers from owner-operators to employees.”

By spring 2010, legal wrangling in the case had racked up a reported $8 million in legal bills paid by the city of Los Angeles alone, and the issue sparked some congressional proposals that had either supported or opposed giving ports more power to regulate trucks nationally.

ATA argued that the Federal Aviation Administration Authorization act of 1994 pre-empted the port from regulating some portions included in the concessionaire plan, including the employee-only mandate.

– By Charlie Morasch, staff writer