Charley's Taxi Radio Dispatch Corp. v. SIDA of Hawaii, Inc.

• Citation: 810 F.2d 869
• Decision Date: 12 February 1987
• Docket Number: No. 85-1828,85-1828
• Parties: , 1987-1 Trade Cases 67,443 CHARLEY'S TAXI RADIO DISPATCH CORPORATION, a Hawaii Corporation, Plaintiff- Appellant, v. SIDA OF HAWAII, INC., a Hawaii Corporation; State of Hawaii; Department of Transportation; and Wayne J. Yamasaki, * in his capacity as Director of Transportation, Defendants- Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

Page 869

810 F.2d 869

55 USLW 2493, 1987-1 Trade Cases 67,443

CHARLEY'S TAXI RADIO DISPATCH CORPORATION, a Hawaii Corporation, Plaintiff- Appellant, v. SIDA OF HAWAII, INC., a Hawaii Corporation; State of Hawaii; Department of Transportation; and Wayne J. Yamasaki, ^* in his capacity as Director of Transportation Defendants- Appellees.

No. 85-1828.

United States Court of Appeals Ninth Circuit.

Argued and Submitted March 25, 1986.

Decided Feb. 12, 1987.

Joel Linzer and Daniel J. Furniss, San Francisco, Cal., for plaintiff-appellant.

Gerald Y. Y. Chang, Honolulu, Hawaii, for State of Hawaii and Dep't of Transportation.

Torkildson, Katz, Jossem & Loden, Robert S. Katz, Honolulu, Hawaii, for SIDA.

Appeal from the United States District Court for the District of Hawaii.

Before FERGUSON, CANBY and HALL, Circuit Judges.

CANBY, Circuit Judge:

Charley's Taxi Radio Dispatch Corporation ("Charley's") appeals the district court's dismissal of its antitrust action. The defendants in this action are the State Independent Drivers Association of Hawaii, Inc. ("SIDA"), the State of Hawaii, the State of Hawaii's Department of Transportation ("DOT"), and Wayne J. Yamasaki, Director of Transportation. After a six-day bench trial, the district court found that Charley's had failed to establish that either SIDA or the state defendants had violated either section 1 or 2 of the Sherman Act, 15 U.S.C. Secs. 1, 2 (1982). We hold that (1) the Eleventh Amendment bars Charley's action against Hawaii and the DOT; (2) under the Parker state action doctrine Director Yamasaki may not be enjoined from enforcing the challenged contract; and (3) SIDA did not engage in a group boycott in violation of the section 1 of the Sherman Act, or engage in other conduct prohibited by the Sherman Act. Accordingly, we vacate in part, affirm in part, and remand.

FACTS

SIDA, the State Independent Drivers Association, Inc., is the largest taxi company on Oahu, Hawaii. It was formed in 1963 by a group of individual taxi owner-operators for the purpose of gaining access to airport and hotel taxi stands that were contracted out on an exclusive basis to individual taxi companies. SIDA's membership is limited to independent taxi operators; it does not admit fleet operators.

In 1963, Hawaii's Department of Transportation awarded a contract granting SIDA the exclusive right, subject to minor exceptions, to provide taxi service from Honolulu International Airport. No restrictions were placed on taxi service to the Airport. The DOT's decision to award an exclusive contract was unilateral and not based upon negotiations with SIDA.

From 1963 to 1971, SIDA's contract with the DOT was renewed every two years. In 1973 SIDA's contract was renewed for five years. In 1978, SIDA's contract was renewed for 15 years.

Charley's Taxi Radio Dispatch Corporation is the largest fleet operator on Oahu, Hawaii. In 1979, Charley's brought this action in the United States District Court for the District of Hawaii against SIDA, the State of Hawaii, and various state agencies and officials ¹ alleging that (1) the exclusive contract between SIDA and the DOT restrained trade in violation of section 1 of the Sherman Act; (2) SIDA unlawfully monopolized in violation of section 2 of the Sherman Act; and (3) SIDA's refusal to accept it as a member was a per se unlawful group boycott in violation of section 1 of the Sherman Act.

On June 22, 1982, Charley's moved for partial summary judgment, arguing that Parker state action immunity was not available to the state defendants. The state defendants filed a countermotion asserting On November 5, 1984, following a bench trial, the district court ruled in favor of SIDA and Hawaii. It found that neither defendant had violated the Sherman Act. Judgment was entered on February 22, 1985. Charley's filed a timely appeal.

                that it was available.  On April 1, 1983, the district court ruled that Parker immunity was unavailable under the Midcal two-prong test.   Charley's Radio Dispatch, Inc. v. SIDA, 562 F.Supp. 712 (D.Hawaii 1983).  On September 13, 1983, the district court denied the state defendants' motion to dismiss based on the Eleventh Amendment
                

DISCUSSION

I. JURISDICTION AND THE ELEVENTH AMENDMENT

The first issue we must consider is whether the district court correctly asserted jurisdiction over the state defendants. We review de novo findings of subject matter jurisdiction. Bright v. Bechtel Petroleum, Inc., 780 F.2d 766, 768 (9th Cir.1986). We conclude that the Eleventh Amendment deprived the district court of jurisdiction over Charley's action against Hawaii and the DOT.

The Eleventh Amendment provides that:

The judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.

Under this amendment, an unconsenting state is immune ² from suits brought in a federal court by citizens of another state or, as in this case, citizens of her own. Pennhurst State School & Hospital v. Halderman, 465 U.S. 89, 100, 104 S.Ct. 900, 907, 79 L.Ed.2d 67 (1984). The Eleventh Amendment's jurisdictional bar also extends to suits brought in federal court against state agencies and departments. Id.; Almond Hill School v. United States Department of Agriculture, 768 F.2d 1030, 1034 (9th Cir.1985).

Charley's contends that Hawaii and the DOT waived their immunity to suit in the district court. A state may waive its Eleventh Amendment immunity only by giving an "unequivocal indication" that it consents to suit in a federal court. Atascadero State Hospital v. Scanlon, 473 U.S. 234, 105 S.Ct. 3142, 3145 n. 1, 87 L.Ed.2d 171 (1985). We may find such an indication where (1) the state expressly consents to federal jurisdiction in the context of the litigation, see Actmedia, Inc., v. Stroh, 789 F.2d 766, 772 (9th Cir.1986); (2) a state statute or constitutional provision expressly provides for suit in a federal court, Atascadero, 105 S.Ct. 3142 at n. 1; or (3) Congress clearly intends to condition the state's participation in a program or activity on the state's waiver of its immunity. Id. at 3150; Doe v. Maher, 793 F.2d 1470, 1477 (9th Cir.1986). ³

None of these conditions are present here. Hawaii and the DOT have asserted their constitutional immunity throughout the course of this action. The statutes relied on by Charley's, Haw.Rev.Stat.

                Secs. 662-2 and 662-3 (1976 & Supp.1984), are waivers of immunity from tort liability. 4   They cannot even remotely be considered an "unequivocal indication" of consent to suit in federal court on antitrust claims
                

Nor has Congress manifested a clear intent to condition either Hawaii's operation of the Airport or the DOT's entering into exclusive contracts on a waiver of Eleventh Amendment immunity. To the contrary, "in enacting the Sherman Act, [Congress] did not intend to compromise the States' ability to regulate their domestic commerce." Southern Motor Carriers Rate Conference, Inc. v. United States, 471 U.S. 48, 105 S.Ct. 1721, 1726, 85 L.Ed.2d 36 (1985); see also Parker v. Brown, 317 U.S. 341, 351, 63 S.Ct. 307, 313, 87 L.Ed. 315 (1943) ("The Sherman Act makes no mention of the state as such, and gives no hint that it was intended to restrain state action or official action directed by a state"). The Eleventh Amendment thus barred Charley's action against Hawaii and the DOT.

In contrast with states and their agencies, state officials acting in their official capacity enjoy only limited immunity under the Eleventh Amendment. Although suits against state officials allegedly violating federal law may be brought in federal court, see Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974); Ex parte Young, 209 U.S. 123, 160, 28 S.Ct. 441, 454, 52 L.Ed. 714 (1908), only prospective injunctive relief may be awarded, Pennhurst, 465 U.S. at 102-03, 104 S.Ct. at 909; Edelman, 415 U.S. at 666-67, 94 S.Ct. at 1357. Charley's alleged that the Airport's exclusive taxi service contract violated the Sherman Act. The district court thus properly entertained Charley's action to enjoin Director of Transportation Yamasaki from enforcing the contract.

The district court's jurisdiction over Charley's action against SIDA was, of course, unaffected by the Eleventh Amendment.

II. DIRECTOR YAMASAKI AND THE PARKER STATE-ACTION DOCTRINE

Charley's contends that the district court erred in dismissing its injunctive action against Director of Transportation Yakasaki. We may affirm the district court on any ground supported by the record, even if the ground is not relied on by the district court. Big Spring v. Bureau of Indian Affairs, 767 F.2d 614, 616 (9th Cir.1985), cert. denied, --- U.S. ----, 106 S.Ct. 2914, 91 L.Ed.2d 543 (1986). In this case we affirm on a ground in fact rejected by the district court: the Parker state-action doctrine.

In Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943), the Supreme Court held that an anticompetitive marketing program instituted under the California Agricultural Act was exempt from the Sherman Act. The Court stated, "There is no suggestion of a purpose to restrain state action in the [Sherman] Act's legislative history." Id. at 351, 63 S.Ct. at 313. Over the years, the scope of the exemption for "state action" under Parker has been tested and delineated. See, e.g., Southern Motor Carriers Rate Conference, 471 U.S. 48, 105 S.Ct. 1721, 85 L.Ed.2d 36 (1985) (state authorized rate bureaus composed of private common carriers found immune); Community Communications Co. v. City of Boulder, 455 U.S. 40, 52-54, 102 S.Ct. 835, 841-42, 70 L.Ed.2d 810 (1982) (cities exempt when acting pursuant to clearly articulated and affirmatively expressed state policy); Goldfarb v. Virginia State Bar, 421 U.S. 773, 778-92, 95 S.Ct. 2004, 2008-15, 44 L.Ed.2d 572 (1975) (state bar acting alone could not immunize...