Farina v. Metro. Transp. Auth.

• Decision Date: 21 August 2019
• Docket Number: 18-cv-1433 (PKC)
• Citation: 409 F.Supp.3d 173
• Parties: Jason FARINA, Charles Gardner, Dorothy Troiano, Deloris Ritchie and Mirian Rojas, on behalf of themselves and all others similarly situated, Plaintiffs, v. METROPOLITAN TRANSPORTATION AUTHORITY, Triborough Bridge and Tunnel Authority, the Port Authority of New York and New Jersey, New York State Thruway Authority and Conduent State and Local Solutions, Inc., Defendants.
• Court: U.S. District Court — Southern District of New York

409 F.Supp.3d 173

Jason FARINA, Charles Gardner, Dorothy Troiano, Deloris Ritchie and Mirian Rojas, on behalf of themselves and all others similarly situated, Plaintiffs,

v.METROPOLITAN TRANSPORTATION AUTHORITY, Triborough Bridge and Tunnel Authority, the Port Authority of New York and New Jersey, New York State Thruway Authority and Conduent State and Local Solutions, Inc., Defendants.

18-cv-1433 (PKC)

United States District Court, S.D. New York.

Signed August 21, 2019

Joseph Ralph Santoli, Joseph R. Santoli, Esq., Ridgewood, NJ, Stephen John Fearon, Jr, Squitieri & Fearon LLP, New York, NY, for Plaintiffs.

Esteban Morales, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., Joshua Briones, Blank Rome LLP, Los Angeles, CA, Todd Fredrick Rosenbaum, Mintz Levin Cohn Ferris Glovsky & Popeo, P.C., New York, NY, Andrew Joshua Blady, Sessions, Fishman, Nathan & Israel, Furlong, PA, Aaron R. Easley, Sessions, Fishman, & Nathan & Israel LLC, Flemington, NJ, Michael Alltmont, Sessions, Fishman, Nathan & Israel, L.L.C., Metairie, LA, Arthur Jay Sanders, Law Offices of Arthur Sanders, New City, NY, Mitchell Lee Williamson, Barron & Newburger, P.C., Somerset, NJ, for Defendants.

OPINION AND ORDER

CASTEL, U.S.D.J.

E-Z Pass technology was first introduced late last century and met with initial public skepticism. With the passage of time, it has been embraced as a convenience that eliminates a driver's search for loose change and reduces traffic backups at toll-collection points.¹ The State of New York is one of 17 states where E-Z Pass is available. Since 2017, New York's toll collection has moved toward "cashless tolling," in which a car's passage through a toll point is recorded through the E-Z Pass transponder or a license-plate reader. Those not registered with an E-Z Pass account are billed by mail. Neither E-Z Pass nor the transition to cashless tolls has been problem-free.

Plaintiffs are five drivers who allege that they were wrongfully sent notices to pay fines for failing to comply with aspects of the cashless tolling process. Four of the five plaintiffs received fine notices for failing to comply with some aspect of the automated E-Z Pass system, and a fifth plaintiff received fine notices for failing to pay toll bills sent to her as part of the state's "Tolls-By-Mail" program, an adjunct of the cashless tolling program. Plaintiffs allege that defendants did not give them notice of their violations until long after they occurred, during which time they accumulated fines that totaled from several hundred to tens of thousands of dollars.

Several plaintiffs have successfully challenged the fines that were initially demanded and do not allege that they paid anything more than the tolls. With noted exceptions, plaintiffs who may have paid some amount in fines fail to distinguish in the Complaint between the amount paid in tolls and the amount paid in fines.

Plaintiffs bring a variety of state and federal claims on behalf of themselves and a putative class. They allege that defendants have violated the Eighth Amendment's prohibition against excessive fines, and, separately, failed to give them fair notice in violation of the procedural due process guaranteed by the Fourteenth Amendment. Plaintiffs also bring state law claims for breach of contract, tortious interference with contract, and unjust enrichment, and assert that defendants violated sections 349 and 350 of the New York General Business Law. Plaintiffs seek money damages, disgorgement, restitution, injunctive relief and punitive damages.

Defendants Triborough Bridge and Tunnel Authority ("TBTA"), the Port Authority of New York and New Jersey ("Port Authority") and the New York State Thruway Authority (the "Thruway Authority") are public entities that administer aspects of New York's toll systems. Defendant Conduent State and Local Solutions, Inc. ("Conduent") is a private company that contracted to administer aspects of the cashless-tolling process.

The TBTA, Port Authority and Thruway Authority assert that plaintiffs do not have Article III standing, and move to dismiss the Complaint for lack of subject matter jurisdiction pursuant to Rule 12(b)(1), Fed. R. Civ. P. All defendants move to dismiss the Complaint for failure to state a claim. Rule 12(b)(6), Fed. R. Civ. P.

For the reasons that will be explained, the Rule 12(b)(1) motions will be denied in their entirety. The Rule 12(b)(6) motions will be granted, except as to the excessive fine and unjust enrichment claims of Dorothy Troiano against the TBTA.

BACKGROUND.

A. Overview of the Cashless Tolling System.

In 2017, the TBTA, Port Authority and Thruway Authority "switched many of their bridges and tunnels to ‘cashless toll’ collecting, meaning that tolls are collected from drivers using automated systems." (Compl't ¶ 2.) Tollbooths were dismantled and drivers could no longer pay in cash at many crossings. (Compl't ¶ 2.) Instead, tolls were collected through "E-Z Pass" and "Tolls-By-Mail" systems. (Compl't ¶¶ 2, 57.) Among other claimed benefits, cashless tolling alleviates congestion at crossings and permits the agencies to shift responsibilities from toll collection to security and safety. (Compl't ¶ 61.)

Drivers participating in the E-Z Pass system affix a tag to their vehicle, and maintain an E-Z Pass account linked to their bank account or credit card. (Compl't ¶¶ 58-59.) When the vehicle passes through a tolling location, an E-Z Pass transponder on or in the car communicates with an antenna, and the E-Z Pass account is charged for the toll. (Compl't ¶ 58.) When an account's balance becomes low, the driver's bank or credit card is automatically charged to "reload" the account. (Compl't ¶ 59.)

As part of the cashless-tolling system, New York maintains a "Tolls-By-Mail" system for drivers who are not enrolled in E-Z Pass. (Compl't ¶ 60.) The vehicle and its license plate are photographed when a driver passes through a tolling point on a bridge, road or tunnel. (Compl't ¶ 60.) A license-plate reader is used to identify the vehicle's registered owner, and a bill for the toll is then mailed to its owner. (Compl't ¶ 60.)

Defendants are responsible for different bridges, tunnels and roadways in the State of New York. The TBTA is controlled by the Metropolitan Transportation Authority ("MTA"), and oversees seven toll bridges and two tunnels around New York City. (Compl't ¶¶ 24-28.) The Thruway Authority manages the Governor Thomas E. Dewey Thruway in New York, which includes 496 miles of toll roads. (Compl't ¶¶ 29-33.) The Port Authority oversees the bridge and tunnel crossings between New York and New Jersey, including the Lincoln and Holland tunnels and the George Washington Bridge. (Compl't ¶¶ 34-35.)

These public authorities outsourced billing and collection duties to various private companies, including Conduent, which allegedly manages billing for the cashless tolling system, and sent bills and notices to drivers who incur fines. (Compl't ¶¶ 49-55.)²

B. Fines Administered for Violations of Cashless-Tolling Procedures.

The Complaint and the parties' memoranda variously refer to charges (other than actual tolls) as "penalties," "fees" and "fines." There appears to be no meaningful distinction between the terms. For consistency, the Court refers to them as "fines," except where quoting from a submission.

Defendants impose fines upon vehicle owners who fail to comply with aspects of the cashless tolling system. The TBTA and the Thruway Authority have adopted regulations that govern imposition of such fines.

The Thruway Authority provides for a "toll violation fee ... in the amount of $100.00" for the "evasion, nonpayment, payment in other than lawful currency, payment of less than the full amount required or other failure to comply with the published toll rates or tolls for any reason along the Thruway System for any cashless tolling facility...." 21 N.Y.C.R.R. § 101.3(a)(1)(i)(a ).

The regulations of the TBTA set a "toll violation fee" in the amount of $50 or $100, depending on the crossing. 21 N.Y.C.R.R. § 1021.3(b). For instance, the failure to properly pay the toll at the Henry Hudson Bridge will result in a $50 fine, whereas a fine of $100 is assessed for failure to pay the toll at the Queens Midtown Tunnel. Id. The fine is charged to "[t]he owner of any vehicle which violates toll collection regulations by crossing a bridge or tunnel without paying the crossing charge prescribed by the Authority...." Id. The fine "shall be in addition to the applicable crossing charge and any fines and penalties otherwise prescribed by law or by agreement." Id. The TBTA's regulations also establish a procedure for disputing a fine, which includes the vehicle owner's filing of an initial complaint, a decision by the TBTA's "Authorized Agent" and an administrative appeal to the TBTA. Id. § 1021.3(d)-(f).

The parties have not pointed to any regulation by the Port Authority that governs the administration of fines or establishes a process to dispute them. However, New York and New Jersey both have statutes that permit the Port Authority to charge tolls for the construction and maintenance of tunnels and bridges. N.Y. Unconsolidated L. § 6501; N.J. Stat. Ann. § 32:1-118. Plaintiffs do not assert that the Port Authority lacks authorization to set fines for violating cashless-tolling procedures.

For plaintiffs who participated in the E-Z Pass program, an agreement included certain terms and conditions that governed its use (the "Agreement"). (Compl't ¶¶ 134, 136; Fausti Dec. Ex. A.) Under the heading "Violations," the Agreement provides that if a user's account "is in a negative balance, suspended or revoked as a result of E-ZPass speed violations or any other reason, or after the Tag has been reported lost or stolen, you may: incur administrative fees of up to $100 per occurrence...." (Agrm't ¶ 5.a.) It also provided for a $100 fine if the E-Z Pass tag is affixed to a vehicle "other than one of the class for which the Tag is...