Cedarhurst Air Charter, Inc. v. Waukesha CountyCedarhurst Air Charter, Inc. v. Waukesha County
DECISION AND ORDER
Plaintiff Cedarhurst Air Charter, Inc. [“CAC”] operates its business out of Waukesha County Airport, which is owned by defendant Waukesha County. The county leases space at the airport to a “fixed base operator” [“FBO”], a private business that manages and operates the airport pursuant to a contract with the county. The county requires all owners who store their aircraft at the airport to buy fuel from the FBO; owners are not permitted to fuel their own planes, and fuel vendors other than the FBO are not allowed to do business at the airport.
These allegations, which are taken from the plaintiffs complaint and accepted as true only for present purposes, form the basis for CAC’s claims that the county violated federal antitrust laws by conspir
I. FEDERAL ANTITRUST CLAIMS
The county asserts that CAC’s antitrust claims are barred by the state action immunity from antitrust liability established by the Supreme Court in
Parker v. Brown,
In the present case, Wisconsin statutes grant the county broad authority to establish, operate and regulate a local airport. Wis.Stats. §§ 114.11(1) and 114.14(1). The county has the authority to “adopt regulations, and establish fees or charges for the use of the airport”. § 114.14(1). The county has established an airport commission pursuant to § 114.14(2)(a), and the commission is empowered to “make such contracts or other arrangements as may be deemed necessary for the construction, improvement, equipment, maintenance or operation of the airport.” § 114.14(3). The county argues that these airport statutes constitute a “sweeping grant of authority [that] anticipates anticompetitive conduct by local governments with respect to local airports, and therefore affords the County state action immunity to antitrust claims arising out of such conduct.”
The plaintiff disagrees and argues that several statutes demonstrate the legislature’s intent to forbid the allegedly anti-competitive conduct challenged here. One set of statutes relied upon by CAC is found in Wisconsin’s antitrust laws, § 133.03
et seq.,
Wis.Stats. Section 133.03 forbids, in , language similar to that of the Sherman Act, agreements or conspiracies to restrain or monopolize trade, and its prohibitions apply to municipal governments. § 133.02(3);
American Medical Transport of Wisconsin, Inc. v. Curtis-Universal, Inc.,
I conclude that CAC’s argument is correct. The county’s claim of state action immunity is based only on the broad, general grant of authority by the legislature to the county with respect to airports. However, it is often difficult to distinguish between “a [state] regulatory program designed to supplant the operation of the free market [and] ... one that can coexist happily with the full enforcement of federal antitrust principles”.
Hardy v. City Optical Inc.,
The county has failed to explain how its claims of state action immunity can be reconciled with state antitrust laws. The county criticizes the cases relied on by the plaintiff as irrelevant or too old, but a recent Wisconsin Supreme Court ease (1990), not cited by the parties, supports the plaintiffs view.
See AMT,
The plaintiffs in AMT were three ambulance companies who alleged that the defendant City of Milwaukee violated state antitrust law by assigning most of its ambulance work to four preferred companies (also defendants), thereby relegating the plaintiffs to back-up status. The trial court dismissed the complaint and the appellate court affirmed, holding that pursuant to the city’s broad home-rule powers granted by § 62.11(5), the city had the authority to implement its ambulance system despite its anticompetitive effects.
The Wisconsin Supreme Court reversed, holding that the home-rule statute could not be construed as authorizing the city’s anticompetitive, monopolistic regulation of ambulance service.
Id.
at 150-51,
The home-rule statute at issue in
AMT
is more general than the airport statutes relied upon by the county in the present case. However, the court in
AMT
also opined that §§ 59.07 and 60.565, which grant towns and counties more specific authority to contract for ambulance services, do not authorize anticompetitive conduct.
Id.
at 152,
CAC argues that there is more statutory evidence to refute the county’s claim that its actions are authorized by the state legislature. CAC contends that the same statutes which grant the county the authority to operate the airport also forbid the county from exercising that authority in a manner contrary to federal law. For example, § 114.11, which permits local governments to regulate local airports, provides that such regulations “shall not be in conflict with such rules and regulations as may be made by the federal government.” Section 114.105, which authorizes local governments to enact ordinances for the regulation of airports, states that “[n]o local authority shall enact any ordinance governing aircraft or aeronautics contrary to or inconsistent with ... federal law.”
According to CAC, the county’s policy of requiring aircraft owners to purchase fuel from the FBO is contrary to several FAA regulations. One source of regulations, FAA Order 5190.6A, prohibits the county from refusing
to permit an air carrier, air taxi, or flight school to fuel its own aircraft.... [A]ircraft owners should be permitted to fuel ... their own aircraft. A restriction which has the effect of diverting such business to a commercial operator amounts to an exclusive monopoly of aeronautical activity contrary to law.
FAA Order 5190.6A, Section 2 at § 3-9d(l) and § 3 — 9e(l). The conduct at issue here could not have been intended by the state legislature, CAC argues, because federal regulations incorporated by §§ 114.11 and 114.105, Wis.Stats., specifically forbid it.
The county has not responded to the plaintiffs contention in its reply brief. Because I find no obvious flaws in the argument, I will credit it.
See Hardy v. City Optical Inc.,
I conclude that the county has fallen short of showing the type of “clear articulation of a state policy to authorize anti-competitive conduct” needed to support its defense of state action .immunity.
See City of Columbia v. Omni Outdoor Advertising, Inc.,
The exception is
Town of Hallie v. City of Eau Claire,
The defendant’s motion to dismiss will be denied as to the plaintiffs federal antitrust claims.
II. SECTION 1983 CLAIMS
A. Section 1983 Claim under the AAIA and FAA Regulations
CAC’s third cause of action is brought pursuant to § 1983 for alleged violations of its rights under FAA Order 5190.6A (quoted in relevant part above) and under the AAIA (49 U.S.C. § 47107). The plaintiff asserts that both the order, as well as certain “grant assurances” made by the county in order to receive federal funds under § 47107, give the plaintiff the right to fuel its own aircraft. The defendant contends that both the AAIA and the Federal Aviation Act [“FAA”] do not give rise to claims under § 1983. This mandates dismissal of not only the AAIA claim but also the claim based on the FAA Order, the county argues, because the FAA Order was promulgated primarily under the AAIA and the FAA.
The county identifies a number of cases which have held that § 47107 (or its predecessor § 2210) is not enforceable under § 1983.
See, e.g., Four T’s, Inc. v. Little Rock Mun. Airport Comm’n,
Despite the number of cases that support the county’s view, I am not prepared at this time to accept it. I believe that the cases cited by the defendant have limited precedential value here because each of them is either distinguishable, unpersuasive, outdated in light of more recent Supreme Court precedent, or some combination thereof. Before discussing these cases, however, I first turn to the analytical framework established by the Supreme Court for determining whether a federal statute or regulation creates rights that can be asserted in a § 1983 action.
Section 1983 imposes liability on anyone who, under color of state law, deprives a person “of any rights, privileges, or immunities secured by the Constitution and laws.” In order to bring a § 1983 action, “a plaintiff must assert the violation of a federal right, not merely a violation of federal law.”
Blessing v. Freestone,
We have traditionally looked at three factors when determining whether a particular statutory provision gives rise to a federal right. First, Congress must have intended that the provision in question benefit the plaintiff. [Wright v. City of Roanoke Redevelopment & Hous. Auth.,479 U.S. 418 , 430,107 S.Ct. 766 ,93 L.Ed.2d 781 (1987) ]. Second, the plaintiff must demonstrate that the right assertedly protected by the statute is not so “vague and amorphous” that its enforcement would strain judicial competence. [Id. at 431 — 32][,107 S.Ct. 766 ]. Third, the statute must unambiguously iihpose a binding obligation on the States. In other words, the provision giving rise to the asserted right must be couched in mandatory rather than prec-atory terms. [Wilder v. Virginia Hosp. Ass’n,496 U.S. 498 , 510-11,110 S.Ct. 2510 ,110 L.Ed.2d 455 (1990) ].
If these requirements are met, there is a presumption that the plaintiff has a right enforceable under § 1983.
Id.
at 341,
This court must analyze the relevant statutory scheme with these principles in mind in order to determine whether a § 1983 action is available.
Wiley,
I therefore must assume, for purposes of the present motion, that there is a rebutta-ble presumption that CAC has a right enforceable under § 1983. The presumption may be rebutted only if Congress intended to foreclose a remedy under § 1983. The county asserts that Congress has done so. Two of the cases cited by the defendant have held that the administrative enforcement scheme established by Congress precludes § 1983 actions under § 47107.
See Northeast Jet Center, Ltd. v. Lehigh-Northampton Airport Auth.,
One such precedent is
Golden State Transit Corporation v. City of Los Angeles,
[t]he availability of administrative mechanisms to protect the plaintiffs interests is not necessarily sufficient to demonstrate that Congress intended to foreclose a § 1983 remedy.... Rather, the statutory framework must be such that allowing a plaintiff to bring a § 1983 action would be inconsistent with Congress’ carefully tailored scheme.
Id.
at 106-07,
We disagree with the Court of Appeals’ rather summary conclusion that the administrative scheme of enforcement foreclosed private enforcement. The Court of Appeals merely relied on one of its prior cases which had referred to HUD’s authority to enforce the annual contributions contracts.... HUD undoubtedly has considerable authority to oversee the operation of the PHA’s [public housing authorities]. We are unconvinced, however, that respondent has overcome its burden of showing that the remedial devices provided in [the Housing Act] are sufficiently comprehensive ... to demonstrate congressional intent to preclude the remedy of suits under § 1983.
Wright v. City of Roanoke Redev’t and Housing Auth.,
The authorities relied upon by the defendant are inconsistent with these cases.
See, e.g., Northeast Jet Center,
The remaining cases cited by the county are decided on grounds that are either irrelevant or incorrect under the analytical framework set forth in
Freestone.
In
Four T’s, Inc. v. Little Rock Municipal Airport Commission,
The court’s second reason was the absence of an explicit or implicit private cause of action under the AAIA itself (apart from a § 1983 action).
Id.
This clearly was not a proper reason for dismissing a § 1983 action under the Supreme Court cases discussed above. The court’s confusing reasoning is explained by an unusual mistake in the opinion: in extracting the relevant legal rule from a prior decision, the court omitted the crucial word “not”. Quoting
Howe v. Ellenbecker,
To be enforceable under § 1983 .... the statute itself must provide ‘a comprehensive remedial scheme which leaves no room for additional private remedies.’ Howe, 8 F.3d at 1263 (citation omitted).
By omitting the word “not”, the court in Four T’s gave the relevant rule the opposite of its correct meaning. This was not a mere typographical error; the court actually applied the misstated rule. This explains why the court treated a fact that was favorable or neutral to the plaintiffs § 1983 claim — i.e. the absence of a private cause of action under the provisions of the AAIA itself — as a basis for dismissal. Because the court’s mistake caused it to reach a conclusion that is plainly inconsistent with Howe, Wilder, Artist M. and Freestone, I conclude that the Four T’s decision has no precedential value in the present case.
Two cases cited by the defendant hold that the AAIA is not the kind of statute that creates private rights that can be enforced pursuant to § 1983.
See Northeast Jet Center, Ltd. v. Lehigh-Northampton Airport Auth.,
Since then, both the Supreme Court and the court of appeals for the seventh circuit have permitted plaintiffs to bring § 1983 actions based upon state assurances made as a condition of receiving federal funds disbursed under federal statutes.
Wilder,
B. Section 1983 Claim under the Commerce Clause
In its fourth claim, which is brought pursuant to § 1983, CAC asserts that the county’s fueling restrictions violate the Commerce Clause. The county argues that the claim must be dismissed because the county acts as a market participant when it requires aircraft owners to buy fuel from the FBO. The market participant doctrine differentiates between a State acting in its governmental capacity and a State acting in the more general capacity of a market participant; the Commerce Clause applies only to the former.
Camps Newfound/Owatonna, Inc. v. Town of Harrison,
According to the county, three courts have held that government airports act as market participants when they impose concession fees on lessees who rent space from them at the airport:
Four T’s,
The county does not merely collect fees from renters or licensees in exchange for space; it imposes a restriction that benefits a third party in a market in which it does not directly participate — the market for aircraft fuel. In this respect, this case is similar to
South-Central Timber Development, Inc. v. Wunnicke,
ORDER
Therefore, IT IS ORDERED that the defendant’s motion to dismiss be and hereby is denied, with costs.