Reeves v. Queen City Transportation, Inc.Reeves v. Queen City Transportation, Inc.
MEMORANDUM OPINION AND ORDER
Defendants, the Public Utilities Commission of the State of Colorado and the individual Commissioners thereof, Robert J. Hix, Vincent Majkowski, and R. Brent Mderfer (collectively, “the PUC”), move to dismiss plaintiffs’ complaint pursuant to
I. PLEADING STANDARDS
A court may dismiss a complaint for “failure to state a claim upon which relief can be granted.”
II. ALLEGED FACTS
I derive the following facts from the complaint. To the extent plaintiffs present matters outside the pleadings in their response brief, I exclude such matters from consideration.
See
Plaintiffs commenced this action on April 21, 1997. Plaintiffs allege two claims against Queen City: (1) discrimination in violation of United State Department of Transportation regulations, found at
III. TITLE II OF THE AMERICANS WITH DISABILITIES ACT OF 1990
Title II of the ADA prohibits “public entities” from discriminating against disabled individuals. A “public entity” is broadly defined under the statute as “any State or local government” and “any department, agency, special purpose district, or other instrumentality of a State or States or local government.”
The operative language of Title II states:' “[N]o qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity.”
The operative language of Title II, however, must be read in conjunction with applicable implementing regulations.
See Crandon v. United States,
Unlike the other titles in this Act, title II does not list all of the forms of discrimination that the title is intended to prohibit. Thus, the purpose of this section is to direct the Attorney General to issue regulations setting forth the forms of discrimination prohibited.
H.R.Rep. 101-485, part III at 52 (1990),
reprinted in
1990 U.S.C.C.A.N. 445, 475. In response to this congressional mandate, the DOJ issued regulations defining the forms of discrimination prohibited by Title II of the ADA. Because Congress left to the Attorney General the task of giving meaning to § ,12132’s broad prohibition of discrimination in public services, DOJ regulations must be “given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute.”
Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc.,
IV. ANALYSIS
Plaintiffs do not allege that the PUC wrongfully denied their application for a certificate of public convenience and necessity to operate as a common carrier. Nor do plaintiffs allege that the PUC’s certification standards require certified common carriers to discriminate against qualified individuals with disabilities. The complaint asserts that Queen City, not the PUC, engaged in discriminatory practices. (Compl.t25.) The only conduct on which plaintiffs’ premise their complaint against the PUC is its issuance of a certificate of public convenience and necessity to Queen City. (Compl.lffl 12, 14, 29-31.) In response to the PUC’s motion to dismiss, plaintiffs rely on the following DOJ regulation, which states in relevant part:
A public entity, in providing any aid, benefit, or service, may not, directly or through contractual, licensing, or other arrangements, on the basis of disability ... [a]id or perpetuate discrimination against a qualified individual with a disability by providing significant assistance to an agency, organization, or person that discriminates on the basis of disability in providing any aid, benefit, or service to beneficiaries of the public entity’s program; ...
Before resolving this issue, I first outline the nature of the PUC. Although the PUC concedes that it is a “public entity” as defined by the ADA, determining the functions of the PUC will assist with resolution of whether the PUC has denied plaintiffs an “aid, benefit, or service” of a program that it provides. By the authority of the Colorado Constitution and the Colorado General Assembly, the PUC regulates the “facilities, service and rates and charges” of public utilities. C.R.S. §§ 40-1-102 & 104(1) (1997); C.R.S. § 40-10-105(2). This authority includes, but is not limited to, the power to issue certificates of public convenience and necessity to common carriers.
Miller Bros., Inc. v. Public Utils. Comm’n,
The PUC’s issuance of certificates of public convenience and necessity to common carriers is governed by the doctrine of “regulated monopoly.”
Yellow Cab Co-op. Ass’n v. Public Utils. Comm’n,
Based on the salient provisions of its enabling statute and operating regulations, I conclude that the PUC’s primary function and activity is certification, registration, and permitting of public utilities. The PUC does not offer, directly or indirectly, telephone services, electric services, motor vehicle services, or any other public utility services or programs to the public. Its function is limited to regulation of private entities and public utilities that offer such services. Having ascertained the nature of the PUC, I return to analysis of Title II.
As noted above, the general prohibition of Title II states: “no qualified individual with a disability shall, by reason of such disability,
In
Tyler v. City of Manhattan,
In granting the city’s motion for summary judgment, the court stated:
[T]he City correctly argues that the regulations implementing Title II of the ADA do not cover the programs and activities of entities that are licensed or certified by a public entity. See28 C.F.R. § 35.130(b)(6) . Although City programs operated under contractual or licensing arrangements may not discriminate against qualified individuals with disabilities, see28 C.F.R. § 35.130(b)(1) , “[t]he programs or activities of licensees or certified entities are not themselves programs or activities of the public entity merely by virtue of the license or certificate.” See 28 C.F.R. Pt. 35, App. A,Section 35.130 (reference to paragraph (b)(6)). Therefore, except to the extent that plaintiff asserts in Count III that he has been denied access to services, aids, and programs provided by the City under licensing or contractual arrangements, see28 C.F.R. § 35.130(a) , (b)(1), the defendant is entitled to judgment as a matter of law on Count ,111.
Id: at 1441-1442. In addition to concluding that liquor licensure and the issuance of building permits do not constitute “services, programs, or activities of a public entity,” the court also held that the city need not impose on private establishments, as a condition of licensure, a requirement that they make their facilities physically accessible to persons with disabilities:
[Ijndividuals with disabilities are not denied access to such licensed facilities, or to the claimed benefits flowing from the City’s inspection of them, by virtue of any act of the City in the manner it conducts [inspection] activities. Rather, they are excluded from the benefits of the City’s inspection and licensing services solely because the licensed structure itself happens to be inaccessible. Title II of the ADA and its implementing regulations prohibit discrimination against qualified individuals only by public entities. See28 C.F.R. § 35.102(a) ;§ 35.130(a) . It simply does not go so far as to require public entities to impose on private establishments, as a condition of licensure, a requirement that they make their facilities physically accessible to persons with disabilities.
Id. at 1442.
The distinction drawn by
Tyler
demonstrates that the scope of Title II is not limitless. The language chosen by Congress in
A public entity may not discriminate on the basis of disability in its licensing, certification, and regulatory activities. A person is a “qualified individual with a disability” with respect to licensing or certification, if he or she can meet the essential eligibility requirements for receiving the license or certification.
******
A public entity does not have to lower or eliminate licensing standards that are essential to the licensed activity to accommodate an individual with a disability. Whether a specific requirement is “essential” will depend on the facts of the particular case. Where a public entity administers licensing examinations, it must provide auxiliary aids for applicants with disabilities and administer the examinations in accessible locations.
In addition, a public entity may not establish requirements for the programs or activities of licensees that would result in discrimination against qualified individuals with disabilities. For example, a public entity’s safety standards may not require the licensee to discriminate against qualified individuals with disabilities in its employment practices.
ILLUSTRATION: A State prohibits the licensing of transportation companies that employ individuals with missing limbs as drivers. XYZ company refuses to hire an individual with a missing limb who is “qualified” to perform the essential functions of the job, because he is able to drive safely with hand controls. The State’s licensing requirements violate title II.
BUT: The State is not accountable for discrimination in the employment or other practices of XYZ company, if those practices are not the result of requirements or policies established by the State. Although licensing standards are covered by title II, the licensee’s activities themselves are not covered. An activity does not become a “program or activity” of a public entity merely because it is licensed by the public entity.
ADA
TAM II-3.7200 (emphasis added). The Title II TAM is persuasive authority unless it is plainly erroneous or inconsistent with the DOJ regulations it interprets.
Innovative Health Systems,
The Title II TAM is consistent with not only
A public entity may not administer a licensing or certification program in a manner that subjects qualified individuals with disabilities to discrimination on the basis of disability, nor may a public entity establish requirements for the programs or activities of licensees or certified entities that subject qualified individuals with disabilities to discrimination on the basis of disability. The programs or activities of entities that are licensed or certified by a public entity are not, themselves, covered by this part.
Plaintiffs contend that the PUC’s administration of the regulated monopoly system for motor vehicle common carriers is different from the liquor licensure system at issue in
Tyler.
Plaintiffs argue that the PUC’s issuance of a certificate to Queen City created a monopoly and, therefore, the PUC aided discrimination against plaintiffs by providing “significant assistance to an ... organization ... that discriminates on the basis of disability.”
A public entity, in providing any aid, benefit, or service, may not, directly or through contractual, licensing, or other arrangements, on the basis of disability ... [a]id or perpetuate discrimination against a qualified individual with a disability by providing significant assistance to an agency, organization, or person that discriminates on the basis of disability in providing any aid, benefit, or service to beneficiaries of the public entity’s program; ...
Attempting to distinguish this case from
Tyler,
plaintiffs cite
Independent Housing Services v. Fillmore Center Associates, supra.
In
Fillmore,
the plaintiffs claimed that a city redevelopment agency provided bond financing to the owner of a housing project in violation the ADA because the housing project discriminated against disabled persons. In denying the agency’s motion for summary judgment, the court noted the “crucial distinction” that the agency had contracted with the owner of the housing project to provide aid, benefits, or services to beneficiaries of the agency’s “program or activity of urban renewal.”
Fillmore,
Nor is this case similar to
Paxton v. State Dept. of Tax and Revenue,
It is clear that the Lottery Commission offers more than a mere license to the entities which are given lottery outlets. This is not like the liquor and building permits issued by the city in Tyler, where the city had no control over the premises or services. Here, through its contract vendors the Lottery Commission furnishes the lottery devices and services that allow the licensee to conduct lottery sales. The Lottery Commission is clearly a public entity within the meaning of the Americans with Disabilities Act, and it provides an aid, benefit or service on a continuing basis to its licensee. Therefore, the Lottery Commission comes within the scope of28 C.F.R. § 35.130(b)(1) , which precludes a public entity that provides any aid, benefit, or service from allowing disability discrimination, either through contractual, licensing, or other arrangements.
In reaching this conclusion, we reject the appellant’s argument that the lottery is only engaged in a licensing arrangement under
Paxton
at 218-219,
In summary, I conclude that plaintiffs fail to state a claim upon which relief can be
IV. ADMINISTRATIVE ISSUES
A review of the record indicates that Queen City is not represented by counsel. On February 18, 1998, I granted the motion to withdraw of Queen City’s attorney of record, Muriel Agnelli. The notice of withdrawal, dated January 22, 1998, informed Queen City that it could not appear before this court without an attorney. It has been the law, for the better part of two centuries, that a corporation may appear in federal court only through a licensed attorney.
Osborn v. President of Bank of United States,
Magistrate Judge Schlatter held a pretrial conference on February 23, 1998. Despite Ms. Agnelli’s previous motion to withdraw and my order granting such motion, she appeared at the pretrial conference. She represented to Magistrate Judge Schlatter that Queen City and plaintiffs reached a settlement. The pretrial order entered February 23, 1998, but without Ms. Agnelli’s signature on behalf of Queen City. Magistrate Judge Schlatter entered an order on February 23, 1998, directing plaintiffs and Queen City to finalize their settlement and provide the court with a stipulated motion for dismissal “within ten days.” That order also stated: “In the event that settlement is not finalized as between plaintiff and Queen City, substitute counsel for Queen City shall be allowed ten days from this date within which to review and supplement the Pretrial Order.”
Plaintiffs then moved for, and I granted, two extensions of this deadline. Pursuant to my order entered March 13, 1998, plaintiffs and Queen City were to file a stipulated motion for dismissal or a supplemental pretrial order on or before April 3, 1998. As of today, the plaintiffs and Queen City have not done so. Thus, I direct plaintiffs to show cause on or before July 2, 1998 why this action should not be dismissed as to Queen City as having been settled with that defendant.
Accordingly, I ORDER that:
(1) the motion to dismiss of defendants Public Utilities Commission of the State of Colorado, Robert J. Hix, Vincent Majkowski, and R. Brent Alderfer is GRANTED;
(2) plaintiffs’ third claim for relief is DISMISSED with prejudice;
(3) defendants Public Utilities Commission of the State of Colorado, Robert J. Hix, Vincent Majkowski, and R. Brent Al-derfer are DISMISSED as party defendants and AWARDED costs;
(4) the caption of the case is AMENDED to reflect that defendants Public Utilities Commission of the State of Colorado, Robert J. Hix, Vincent Majkowski, and R. Brent Alderfer are no longer parties to this case; and
(5) plaintiffs shall SHOW CAUSE on or before July 2, 1998 why this action should not be dismissed as to defendant Queen City as having been settled with that defendant.