807 F.3d 1008
9th Cir.2015Background
- San Francisco enacted Articles 30 and 30.1 requiring permits, application disclosures (including criminal history), fees, display, recordkeeping, and other conditions for tow‑truck drivers and towing firms operating in the city.
- CTTA (trade association for tow companies) sued, arguing the Permit Scheme is preempted by the FAAAA (49 U.S.C. § 14501(c)(1)) because it relates to price, route, or service of motor carriers.
- The City defended under the FAAAA savings clauses, principally the safety exception (§ 14501(c)(2)(A)), and also invoked insurance and price exceptions for nonconsensual tows.
- On remand from this Court’s earlier opinion (CTTA I), the district court upheld nearly all Permit Scheme provisions, finding most fell within the safety exception or otherwise were not preempted; it excepted the business‑plan requirement.
- This appeal challenges that remand disposition; the Ninth Circuit affirms in part, reverses as to the business‑plan requirement (severable), and remands for further proceedings limited to that issue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Permit Scheme is preempted by the FAAAA | CTTA: Scheme relates to price/route/service and is preempted unless squarely saved; many provisions are economic regulation cloaked as safety. | City: Scheme is saved by FAAAA savings clauses—mainly the safety exception; regulations address real safety problems in towing. | Most provisions are not preempted: permit, application, fees, penalties, recordkeeping, brochure, complaint system fall within the safety exception; business‑plan requirement is preempted. |
| Scope of "safety" under §14501(c)(2)(A) | CTTA: "Safety" should be limited to motor vehicle operational safety (i.e., mechanical/roadway safety of tow trucks). | City: "Safety" covers risks to people and towed vehicles (confrontations, assaults, stranding, illegal tows) and thus is broader. | Court: Adopts broad construction—safety exception covers regulations genuinely responsive to safety risks to people and vehicles associated with towing, not only mechanical operation. |
| Validity of permit possession/display rules and whether they are "service" regulation | CTTA: Requiring display/acts is a "service" and thus subject to preemption. | City: Display/possession are compliance/identification measures, not a regulated "service." | Held: Possession/display requirements are not preempted; they are not services under §14501(c)(1) and thus fall outside preemption (and also support safety objectives). |
| Business plan and complaint‑handling requirement in §3052(4) | CTTA: Both requirements are regulatory and preempted as economic regulation. | City: Both promote safety and consumer protection (complaints reduce confrontations; business plan helps assess safe storage/transport). | Held: Complaint‑system requirement is saved by the safety exception; business‑plan requirement (as to business details/pricing) is not genuinely responsive to safety and is preempted but is severable from the ordinance. |
Key Cases Cited
- City of Columbus v. Ours Garage & Wrecker Serv., Inc., 536 U.S. 424 (2002) (establishes safety‑exception framework: state/local safety regulations are saved if "genuinely responsive to safety concerns")
- Dan’s City Used Cars, Inc. v. Pelkey, 133 S. Ct. 1769 (2013) (narrows FAAAA preemption to laws concerning a motor carrier’s transportation of property)
- Cal. Tow Truck Ass’n v. City & Cnty. of S.F., 693 F.3d 847 (9th Cir. 2012) (CTTA I) (directs provision‑by‑provision analysis and sets safety‑exception inquiry)
- Tillison v. City of San Diego, 406 F.3d 1126 (9th Cir. 2005) (upholds towing regulation as within safety exception where it furthered protection against confrontations and unsafe removals)
- Rowe v. N.H. Motor Transp. Ass’n, 552 U.S. 364 (2008) (preemption does not extend to state laws that affect rates/routes/services only in a remote or peripheral way)
- Cole v. City of Dallas, 314 F.3d 730 (5th Cir. 2002) (permits criminal‑history‑based licensing rules as safety regulation under FAAAA exception)