Supply Chain News / Risk & Compliance / Ocean / Ports

Port of LA Concessions Quashed

The U.S. Supreme Court supports the dominant commerce clause in ATA v. City of Los Angeles.

June 13, 2013
Port of LA

Preemption is an issue the U.S. Supreme Court has examined a number of times relative to transportation, and it has found once again in the case of American Trucking Associations, Inc. V. City of Los Angeles, California, et al. that the placard and parking requirements for drayage carriers set by the city of Los Angeles at the port are preempted by federal law. In a decision handed down on June 13, 2013, the Court said both parties agreed that the requirements affected the carriers’ price, route, or service and, therefore, the issue was whether the requirements “have the force of law.”

When the Court agreed to hear the case, it had said it would not consider the preemption issue, but it did agree to hear the case on the dominant commerce issue (see Down the Road Again).

Joel Anderson, president and ceo of the International Warehouse Logistics Association (IWLA) has already jumped on this element of the decision saying, “This also may help in the Minnesota warehouse tax case because it once again re-affirms the concept of interstate commerce and that when the feds preempt, they preempt exclusively.”

What Anderson is saying is that the long-established position that infers congress’ ability to regulate interstate commerce also prohibits states from passing legislation which improperly burdens or discriminates against interstate commerce. Clearly, Anderson is referring to an IWLA position that the Minnesota tax improperly burdens interstate commerce, and a decision by the Court in favor of the City of Los Angeles would have made their position more tenable in opposing the warehouse tax.

The Court pointed out, “Section 14501(c)(1) [of title 49 of the U.S. Code] draws a line between a government’s exercise of regulatory authority and its own contract-based participation in a market. The statute’s ‘force and effect of law’ language excludes from the clause’s scope contractual arrangements made by a State when it acts as a market participant, not as a regulator.”

What the Court has said is that one defense the City of Los Angeles had offered for its action was that it was acting as a market participant and that would preempt the federal law which doesn’t allow the City to regulate a motor carrier’s rate, route, or service. Saying the placard and parking requirements have the force of law means the market participant argument doesn’t stand up and won’t be debated.

The Court had no problem demonstrating the force of law in this instance: “It forced terminal operators – and through them, trucking companies – to alter their conduct by imple¬menting a criminal prohibition punishable by imprisonment. That counts as action ‘having the force and effect of law’ if anything does,” said the Court finding.

The Court’s decision is available at http://www.supremecourt.gov/opinions/12pdf/11-798_anbf.pdf

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

KC SmartPort Momentum

Kansas City SmartPort Momentum 2013 focused on 3PLs, the issues facing the industry, and the role or logistics in economic development

Podcasts

 

Calculating a true landed cost for global sourcing directly correlates with the profitability of purchased goods. However, few companies can command real-time visibility in to all the costs involved for cross border movements. In this podcast, World Trade 100 and Amber Road highlight how a comprehensive global trade platform that converges both logistics and compliance costs can deliver true landed cost visibility.

 

Speaker: Hung Lee, Senior Product Manager, Amber Road

More Podcasts

THE MAGAZINE

World Trade 100 Magazine

april cover wt100 2014

2014 April

Check out the April 2014 edition of World Trade WT100, featuring articles on fueling changes for trucking plus much more!

Table Of Contents Subscribe

Supply Chain Disruptions

Which are the most common causes of disruptions in your supply chain?
View Results Poll Archive

WT100 STORE

world-class-warehousing.gif
World-Class Warehousing and Material Handling, 1st Edition

Filled with proven operational solutions, it will guide managers as they develop a warehouse master plan, one designed to minimize the effects of supply chain inefficiencies as it improves logistics accuracy and inventory management - and reduces overall warehousing expense.

More Products

Clear Seas Research

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications,Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

Use our interactive maps to locate service providers across North America.Interactive Map

Logistics Development Partners 

IWLA Members

STAY CONNECTED