Alliance of Auto. Mfrs., Inc. v. Jones
| Citation | 897 F.Supp.2d 1241 |
| Decision Date | 20 September 2012 |
| Docket Number | Case No. 4:08cv555/MCR/CAS. |
| Parties | ALLIANCE OF AUTOMOBILE MANUFACTURERS, INC., Plaintiff, v. Julie L. JONES, in her official capacity as the Executive Director of the Department of Highway Safety and Motor Vehicles of the State of Florida, Defendant, Florida Automobile Dealers Association, Defendant–Intervenor. |
| Court | U.S. District Court — Northern District of Florida |
OPINION TEXT STARTS HERE
David Bruce Salmons, Bingham McCutchen LLP, Washington, DC, Dean B. Bunch, Nelson Mullins Riley etc LLP, Major Best Harding, Ausley & McMullen, Tallahassee, FL, Alicia L. Downey, Daniel L. Goldberg, James Chafel McGrath, Bingham McCutchen LLP, Boston, MA, for Plaintiff.
Jonathan Alan Glogau, Tallahassee, FL, for Defendant.
Allen C. Winsor, GrayRobinson PA, Tallahassee, FL, for Defendant–Intervenor.
The Plaintiff, the Alliance of Automobile Manufacturers, Inc. (“the Alliance”), brought this action challenging the constitutionality of Chapter 320, Florida Statutes, which regulates the relationship between motor vehicle manufacturers and dealers in the state of Florida.1 The Defendant, Julie Jones, in her official capacity as the Executive Director of the Department of Highway Safety and Motor Vehicles of the State of Florida (“DHSMV”), and Defendant-intervenor, the Florida Automobile Dealers Association (“FADA”) (referred to collectively as “defendants”), filed a motion to dismiss the Alliance's complaint (doc. 46), arguing that the Alliance has failed to state a claim upon which relief can be granted.2 The Alliance responded in opposition to the motion, and the defendants were granted leave of court to submit a reply.3 Having reviewed the motion, responses, and reply, and heard oral argument from counsel, the court finds that the motion should be granted in part and denied in part.
The Alliance is a non-profit trade association comprised of eleven motor vehicle manufacturers and distributors (“Members”) that sell new motor vehicles and replacement parts throughout the United States.5 In order to conduct business in the state of Florida, each of the Alliance's Members must secure a license. SeeFla. Stat. § 320.61, Fla. Stat. To maintain the license, the Members are required to comply with Florida's laws governing the relationship between motor vehicle licensees and dealers. 6 In Florida and elsewhere, licensees are required to distribute new motor vehicles through independently owned and operated authorized dealers who, in turn, sell or lease the vehicles to retail customers.7 In order to facilitate distribution of their vehicles, the Members enter into contracts with dealers (“Dealer Agreements”) pursuant to which the dealers agree to promote and sell the Members' vehicles and provide certain maintenance and repair services.8 According to the Alliance, unless state law provides otherwise, the Members typically reimburse their dealers for maintenance and repair services based on a uniform methodology that provides for a markup over the dealer cost of the parts or a pre-existing parts price, such as the Manufacturer Suggested Retail Price, plus an approved rate for labor.9 Although warranty and other covered repairs and services are provided to the consumer at no additional charge at the time of service, the cost of such repairs and services is included in the wholesale price of each new motor vehicle. Members also offer bonus, incentive, and other benefit programs to dealers.
Through this action, the Alliance seeks to invalidate three laws governing the relationship between motor vehicle licensees and dealers in the state of Florida, which the Alliance contends are unconstitutional. The first statute the Alliance challenges is Fla. Stat. § 320.696(3) and (4) (the “Parts and Labor Reimbursement Provisions”), which requires licensees to compensate dealers for parts and labor used in performing work pursuant to a warranty, maintenance plan, extended warranty, certified pre-owned warranty, service contract, delivery or preparation procedure, recall, campaign service, authorized goodwill, directive, or bulletin at certain rates in the event the parties cannot agree to a rate within thirty days of the dealer's written request that they attempt to do so. SeeFla. Stat. § 320.696(3)(a), (4)(b).10 The Alliance claims that the Parts and Labor Reimbursement Provisions violate the Due Process Clause of the Florida Constitution and the Contracts Clauses of the United States and Florida Constitutions. The second statute the Alliance challenges is Fla. Stat. § 320.696(6) (the “Recoupment Bar”), which prohibits licensees from directly or indirectly recovering the costs of compensating dealers under the Parts and Labor Reimbursement Provisions. According to the Alliance, the Recoupment Bar discriminates on its face and in its effects against out-of-state manufacturers, dealers, and consumers in violation of the Commerce Clause of the United States Constitution. The Alliance also alleges that the Recoupment Bar violates the Contracts Clauses of the United States and Florida Constitutions. Finally, the Alliance challenges Fla. Stat. § 320.64(38) (the “Extraterritorial Benefit Restriction”), which requires licensees to offer in Florida any bonus, incentive, or other benefit program offered nationally or in the same zone or business region as the state of Florida unless the failure or refusal to offer the program in Florida is reasonably supported by substantially different economic or marketing considerations than are applicable to the licensee's same line-make dealers in this state. The Alliance alleges that the Extraterritorial Benefit Restriction is unconstitutional on its face because it regulates and impacts interstate commerce in violation of the Commerce Clause. The Alliance seeks a declaratory judgment that (1) the Enhanced Parts and Labor Reimbursement Provisions are unconstitutional in their effects; (2) the Recoupment Bar is unconstitutional on its face and in its effects; and (3) the Extraterritorial Benefit Restriction is unconstitutional on its face. The Alliance also seeks a declaration that the reduction or elimination of incentive, bonus, or other benefit programs in the state of Florida in response to higher parts and labor reimbursement costs does not constitute the direct or indirect recovery of costs under the Recoupment Bar and that, even if it does, such action is justified by economic considerations under the Extraterritorial Benefit Restriction and that an interpretation of the Recoupment Bar and Extraterritorial Benefit Restriction as prohibiting the economically justifiable reduction or elimination of incentive, bonus, or other benefit programs is unconstitutional.
The defendants seek dismissal of each of the Alliance's claims, arguing that the Alliance has failed to state a claim upon which relief can be granted. Specifically, with regard to the Alliance's challenges to the Parts and Labor Reimbursement Provisions, the defendants argue that the statute is rationally related to the state's interest in addressing the disparity in bargaining power between motor vehicle manufacturers and dealers and that the Alliance's due process claim thus fails. The defendants also argue that the Alliance lacks standing to assert a Contract Clause claim on behalf of its Members. Regarding the Alliance's challenges to the Recoupment Bar, the defendants argue that the statute does not discriminate on is face because it applies equally to all manufacturers, regardless of residency; the defendants maintain that the Alliance's as applied challenge is not ripe because the Recoupment Bar has not yet been applied and its effects therefore are speculative and unknown. As to the Extraterritorial Benefit Restriction, the defendants insist that it can be constitutionally applied in certain circumstances and that the Alliance's facial challenge to the statute thus fails under United States v. Salerno, 481 U.S. 739, 745, 107 S.Ct. 2095, 95 L.Ed.2d 697 (1987). The defendants also argue that the Alliance's challenge to the Extraterritorial Benefit Restriction is not ripe because the Alliance has failed to allege concrete facts regarding specific benefit programs that will be affected by the statute and that the plaintiffs will suffer no injury from a delay in adjudication of the claim until they are in a position to allege concrete facts in support thereof. Finally, the defendants urge the court to dismiss Counts IV and V of the Alliance's complaint on ripeness grounds and because the Alliance's proposed interpretation of the statutes conflicts with their text, structure, and/or history. The court will address each of the defendants' contentions in turn.
Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” While “ ‘detailed factual allegations' ” are not required, the plaintiff must present “more than an unadorned, the defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). “A pleading that offers ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action will not do.’ ” Id. (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955). “Nor does a complaint suffice if it tenders ‘naked assertion [s]’ devoid of ‘further factual enhancement.’ ” Id. (quoting Twombly, 550 U.S. at 557, 127 S.Ct. 1955). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Id. (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the...
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...case brought in Florida, in which the district court declined to dismiss the Contract Clause claim. See Alliance of Auto. Mfrs., Inc. v. Jones, 897 F.Supp.2d 1241 (N.D.Fla.2012). That reliance is misplaced. In Jones, the defendants argued only that Alliance lacked associational standing to ......