Fla. Transp. Servs., Inc. v. Miami–Dade Cnty.

• Decision Date: 28 December 2012
• Docket Number: 11–11116.,Nos. 11–10475,s. 11–10475
• Citation: 703 F.3d 1230
• Parties: FLORIDA TRANSPORTATION SERVICES, INC., a Florida corporation, Plaintiff–Appellee–Cross–Appellant, v. MIAMI–DADE COUNTY, a political subdivision of the State of Florida, Defendant–Appellant, Cross–Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

703 F.3d 1230

FLORIDA TRANSPORTATION SERVICES, INC., a Florida corporation, Plaintiff–Appellee–Cross–Appellant,

v.MIAMI–DADE COUNTY, a political subdivision of the State of Florida, Defendant–Appellant, Cross–Appellee.

Nos. 11–10475, 11–11116.

United States Court of Appeals,Eleventh Circuit.

Dec. 28, 2012.

Jeffrey B. Crockett, Robert T. Wright, Jr., Coffey Burlington, PL, Miami, FL, Mark Alan Journey, Rice, Pugatch, Robinson & Schiller, PA, Linda Spaulding White, Broad & Cassel, Fort Lauderdale, FL, Carmen Maria Rodriguez, Law Offices of Carmen Rodriguez, PA, Palmetto Bay, FL, for Plaintiff–Appellee–Cross–Appellant.

Steven B. Bass, Wifredo A. Ferrer, Miami, FL, Craig Edward Leen, Coral Gables, FL, for Defendant–Appellant, Cross–Appellee.

Appeals from the United States District Court for the Southern District of Florida.

Before HULL and COX, Circuit Judges, and WALTER,^* District Judge.

HULL, Circuit Judge:

This appeal involves a county ordinance for permitting stevedores at the Port of Miami in Miami–Dade County, Florida. Stevedores load and unload millions of dollars in cargo in interstate and foreign commerce at the Port each year. Stevedore permits expired annually and a county ordinance required each stevedore company each year to reapply and be reassessed, along with any new applicants, as to competency, safety record, financial strength, and need.

Plaintiff Florida Transportation Services, Inc. (“FTS”) filed suit against Defendant Miami–Dade County (“the County”), which owns and operates the Port. The crux of FTS's complaint is that the County's Port Director did not follow the ordinance's requirements at all but instead protected incumbent stevedores and kept out new entrants and competition, like FTS, by rubber-stamping and automatically renewing permits for all existing stevedore permit holders at the Port and automatically denying permits to all new applicants in violation of the dormant Commerce Clause.

The district court granted partial summary judgment for Plaintiff FTS as to liability, concluding the County's denial of permits to FTS in 2003, 2004, and 2005 violated the dormant Commerce Clause. The district court then held a jury trial as to damages. The jury awarded $3.55 million in damages to FTS for lost profits in 2003, 2004, and 2005.

The County appeals the district court's (1) grant of partial summary judgment for FTS as to the County's liability for denyingstevedore permits to FTS in 2003, 2004, and 2005, and (2) denial of the County's motions for judgment as a matter of law as to damages, made both at the close of the evidence and later after the jury's damages award. After review and oral argument, we affirm.

I. BACKGROUND¹

We first recount how the County's Port Director used the permit process to protect the incumbent stevedore permit holders at the Port of Miami from any new entrants and competition in that local market.

A. Port of Miami and the Stevedore Permit Ordinance

The Port of Miami is one of the busiest ports in the nation, fully engaged in interstate commerce, predominantly foreign commerce. For instance, from 2003 through 2005, the Port handled over nine million tons of cargo each year, 39% exported and 61% imported, and around 3.5 million cruise passengers carried on between 719 and 850 cruise ships. From 2002 through 2006, 27% of the trade in the Port was with the Far East, 25% with South America, 17% with Europe, and less than a third of 1% with North America.

Stevedoring is an essential component of the Port. Stevedores load and unload cargo at port facilities. Each year, stevedores move millions of dollars of goods in interstate and foreign commerce through the Port of Miami. The rates stevedores charge are established through an individual agreement between (1) the stevedore and (2) the contracting shippers or cruise lines. The County does not regulate the rates that stevedores charge. But to operate at all in the Port of Miami, the stevedore must obtain a permit from the County, which is the hard part.

The first step—the license—is easy. The County's ordinance requires a person to have a County-issued license in order to act as a stevedore anywhere in Miami–Dade County, Florida. Miami–Dade County, Fla., Code of Ordinances (“Miami–Dade County Code”) § 28A–6.1.²

The second step is the problem here. If the licensed stevedore wants to operate at the Port of Miami, the same County ordinance requires that person also to have a stevedore permit issued by the Director of the Port of Miami. Id. § 28A–6.2.³ The County Manager and Port Director “shall, after examination, issue stevedore licenses and permits, respectively, to competent and trustworthy persons in such numbers as they deem necessary for the efficient operation of the county waterfront and Port of Miami facilities.” Id. § 28A–6.4(c) (emphasis added). To demonstrate that an applying stevedore is competent, the Port Director requires the applicant to provide satisfactory proof that it has trained and experienced personnel to operate the Port's cranes and other equipment. Specifically, the Port Director's Requirement for Competence states:

For any stevedore firm to be issued a permit to work at the Port, it is of utmost importance from a safety and financial risk standpoint that they demonstrate that they are competent to perform the services of a stevedore.

....

To demonstrate that a stevedore firm is competent, they should provide proof that they employ highly trained personnel with specific experience to safely operate the Port of Miami's cargo gantry cranes and other equipment to be utilized at the Port. A demonstrated safety record could assist in determining the level of competency of a stevedore firm.

....

A stevedore permit can and should be denied pending the satisfactory demonstration that the applying stevedore firm has competent personnel and equipment.

The County's ordinance further prescribes nine broad categories of criteria that govern the Port Director's issuance of a Port of Miami stevedore permit, including “[t]he inability or refusal of license or present permit holders, respectively, to adequately serve new or existing business,” Miami–Dade County Code § 28A–6.4(c)(5); “[t]he financial strength of the applicant, including the ability to secure insurance, indemnity and performance bonds,” id. § 28A–6.4(c)(6); and “[t]he experience of the applicant, its affiliates, principals or operating officers,” id. § 28A–6.4(c)(8).⁴ Further, “[t]he Port Director, in making his determination as to the issuance or denial of the permit, shall, in addition to the [nine broad categories of] criteria ... [,] make findings as to the need or lack of need for such permit.”⁵Id. § 28A–6.4(b). In summary, the Port Director must make competency, safety record, financial, and needs assessments in considering the issuance or denial of a permit.

Port of Miami stevedore permits expire annually and automatically on January 15 of each year. Id. § 28A–6.6. Therefore, each and every stevedore, including existing permit holders, must apply or reapply each year. Importantly here, the County's ordinance provides that the Port Director may renew an expiring permit, but only if the renewal application meets the criteria for the issuance of a new permit. Id. Thus, the County's ordinance facially subjected new and renewal applications to the same competency, safety record, financial, and needs criteria. However, as explained below, the Port Director did not abide by the ordinance and did not make these assessments annually. Rather, the Port Director in practice automatically renewed permits of existing permit holders and repeatedly denied permits to new applicants like FTS. Before detailing the County Port Director's permitting practices, we review who held stevedore permits and the stevedore market at the Port of Miami.

B. Permitted Stevedores, 2002–2007

As of 2002, nine companies held stevedore permits for the Port of Miami. About half of these companies were based or incorporated out-of-state, and about half were in-state. These permit-holder companies were: (1) Seaboard Marine, a wholly owned subsidiary of Seaboard Corp., which was based in Kansas; (2) Universal Maritime Service, a New York company; (3) Eller–ITO, a joint venture between (a) Continental Stevedoring and Terminals, whose location is not indicated in the record, and (b) Ports America, a New Jersey corporation;⁶ (4) Ports America Florida,⁷ which was owned by Ports America; (5) R.O. White & Company (“R.O. White”), a Florida company; (6) Hallmark Stevedoring, a Florida company; (7) Florida Stevedoring, a Florida company; (8) Oceanic Stevedoring Company, whose location is not indicated in the record; and (9) Biscayne Stevedore Agency, Inc., whose location is not indicated in the record.⁸

As of 2007, seven of these nine companies—Seaboard Marine, Universal Maritime Service, Eller–ITO, Ports America Florida, R.O. White,⁹ Hallmark Stevedoring, and Florida Stevedoring—still held stevedore permits.

The two stevedore permit holders in 2002 that do not appear on the 2007 list are Biscayne Stevedore Agency and Oceanic Stevedoring. Biscayne last held a stevedore permit in 2005 and did not submit a renewal application in 2005 or beyond. Oceanic appears either to have been acquired by another company or was defunct by 2007. The parties do not dispute the fact that existing permit holders who wanted permit renewals got them annually between 2002 and 2007. ¹⁰

Importantly, too, at least three of the companies on the 2002 and 2007 lists—Seaboard Marine, Ports America Florida, and R.O. White—had their permits renewed even though they were not providing stevedore service.¹¹ This meant that at most six of nine permitted stevedores cornered the Port of Miami market in 2002 and at most four still did in 2007. Those four were: Florida Stevedoring, Eller–ITO, Universal Maritime Service, and Hallmark Stevedoring. As discussed later, the Port Director, year after year, refused to...