N.Y. Shipping Ass'n Inc v. Waterfront Comm'n Of N.Y. Harbor
| Decision Date | 18 March 2011 |
| Docket Number | Civil Action No.: 10-5633 (JLL) |
| Parties | NEW YORK SHIPPING ASSOCIATION, INC., Plaintiff, v. WATERFRONT COMMISSION OF NEW YORK HARBOR, Defendant. |
| Court | U.S. District Court — District of New Jersey |
NOT FOR PUBLICATION
This matter comes before the Court by way of a motion to dismiss filed by Defendant on February 3, 2011 for lack of subject matter jurisdiction under Rule 12(b)(1) of the Federal Rules of Civil Procedure and for failure to state a claim upon which relief can be granted under Rule 12(b)(6). The Court has considered the parties' submissions in support of and in opposition to the present motion and decides the matter without oral argument pursuant to Rule 78. For the reasons set forth below, Defendant's motion is granted.
The following facts are taken from Plaintiff's Amended Complaint unless otherwise noted. Plaintiff, the New York Shipping Association (the "NYSA") is an association of marine terminal operators, stevedoring companies, and vessel operators engaged in international trade and commerce in the Port of New York and New Jersey (the "Port"). The NYSA negotiates andadministers collective bargaining agreements with workers represented by various trade unions.
Defendant, the Waterfront Commission of New York Harbor (the "Commission") is an instrumentality of the States of New York and New Jersey that oversees operations of the Port through licensing, regulatory, and investigatory powers. The Commission was created in 1953 under the Waterfront Commission Compact, an interstate compact between New York and New Jersey. The Commission operates pursuant to the Waterfront Commission Act ("WCA"), N.J. Stat. Ann. §§ 32:23-1, et seq., which incorporates the terms of the Waterfront Commission Compact. Among the Commission's duties is the issuance of licenses to companies that operate in the Port. The Commission bases its licensing determinations on the "good character and integrity" of the applicant company. Id. at § 32:23-21(b). The Commission obtains revenue from statutory assessments paid by companies operating in the Port, including members of the NYSA. The WCA limits this assessment as not to exceed two percent. Id. at § 32:23-58.
In August 2010, the Commission announced a plan to implement a program in which Independent Private Sector Inspectors General ("IPSIGs") could provide additional oversight of operations within the Port. The Commission circulated a "Request for Expressions of Interest and Statements of Qualification in Being Considered for Appointment as an Independent Private Sector Inspector General, " seeking applicants interested in acting as IPSIGs and describing the IPSIG program as follows:
The IPSIG will establish and maintain internal controls designed to deter unethical or illegal conduct, and will report any unethical or illegal conduct observed to the Commission. The IPSIG will examine the operations of stevedoring companies to ensure that they run effectively without fraud, criminal influence, improper accounting and/or hiring practices, or other malfeasance. The Commission may require a stevedoring company to retain an IPSIG pursuant to a responsibility agreement or stipulation with the Commission, in order for that stevedoring company to continue to operate in the Port.
Upon selection by the Commission, the IPSIG will be hired by the stevedoring company but will report directly to the Commission, with the stevedoring company retaining responsibility for payment of the IPSIG's services.
(Am. Compl. Ex. 1 (emphasis added).)
On September 23, 2010, members of the Commission appeared before the New Jersey Senate Economic Growth Committee.1 The Commission's Executive Director, Walter Arsenault, testified that the Commission will not in fact "require" that a stevedoring company retain an IPSIG, as suggested in the August 2010 circular, but rather that such companies would have the option to retain an IPSIG in order to maintain their license to operate in the Port, should licensure have otherwise been denied by the Commission.2 Mr. Arsenault testified that applications for licenses are reviewed by the members of the Commission, and if the Commission finds that the company does not possess the "requisite good character and integrity, " it then issues a notice of hearing. Senate Committee Hr'g at 31. Mr. Arsenault stated that following the denial of a license application,
[the applicant] can go and have the hearing, or they can request and accept an IPSIG. If they lose the hearing, they have the opportunity to appeal it to the Commissioners, or they can accept an IPSIG. If they lose with the Commissioners, they have the opportunity to accept an IPSIG or to appeal it to the courts in the states of New York and New Jersey. And even after they lose that hearing--rather than close down the company, we want togive those companies an opportunity to continue to employ people in the Port of New York, and we're willing to offer them an IPSIG program.
Id. Plaintiff does not dispute Mr. Arsenault's description of the IPSIG program and its relevant procedures.
On October 29, 2010, the NYSA filed the instant action seeking a declaratory judgment that the IPSIG program exceeds the Commission's statutory authority, violates the Commission's enabling statute, and violates constitutional separation of powers. The NYSA further seeks an injunction restraining the Commission from implementing the IPSIG program.
Defendant's arguments in support of the present motion notwithstanding, the Court has federal question jurisdiction over this matter pursuant to 28 U.S.C. §§ 1331 and 1337. The Supreme Court has held that because congressional consent transforms an interstate compact within the Compact Clause into the law of the United States, "the construction of an interstate agreement sanctioned by Congress under the Compact Clause presents a federal question." Cuyler v. Adams, 449 U.S. 433, 438 (1981); see also Waterfront Comm'n v. Sea Land Service, Inc., 764 F.2d 961, 963 n.2 (3d Cir. 1985). The Waterfront Commission compact is within the Compact Clause, and Congress has consented to it. Act of Jan. 3, 1953, ch. 407, 67 Stat. 541 (1953); see Waterfront Comm'n of New York Harbor v. Construction and Marine Equipment Co., 928 F. Supp. 1388, 1394 (D.N.J. 1996).
Under Federal Rule of Civil Procedure 12(b)(1), a court must grant a motion to dismiss if it lacks subject matter jurisdiction to hear a claim. A motion under Rule 12(b)(1) "may be treated as either a facial or factual challenge to the court's subject matter jurisdiction." GouldElecs. Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000). Defendant styles its motion as a facial subject matter jurisdiction challenge. (Def.'s Mot. Br. at 15.) In a facial attack, the movant challenges the legal sufficiency of the claim, and the standard is therefore similar to that of a Rule 12(b)(6) motion. Petruska v. Gannon University, 462 F.3d 294, 302 n.3 (3d Cir. 2006). A court may thus "consider only the complaint, exhibits attached to the complaint, matters of public record, and undisputedly authentic documents if the plaintiff's claims are based upon those documents." New Jersey Mfrs. Ins. Co. v. United States, No. 07-2653, 2008 WL 2168006, at *2 (citing Pension Benefit Guaranty, 998 F.2d at 1196).
For a complaint to survive dismissal under Rule 12(b)(6), it "must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The plausibility standard is not akin to a " 'probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully;" mere consistency with liability is insufficient. Id. In evaluating the sufficiency of a complaint, a court must accept all well-pleaded factual allegations in the complaint as true and draw all reasonable inferences in favor of the non-moving party. See Phillips v. County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008). But, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions[;] [t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 129 S.Ct. at 1949. It is the underlying specific facts alleged in a complaint that should be treated as true and evaluated.
Defendant argues that this Court is without subject matter jurisdiction to hear Plaintiff'sclaims because Plaintiff lacks standing to assert such claims and because Plaintiff's claims are unripe. Defendant further contends that Plaintiff has failed to state a claim upon which relief can be granted because the IPSIG program falls with the Commission's statutory authority, is not prohibited by the WCA, and does not violate the constitutional separation of powers.
Article III of the Constitution confines the jurisdiction of the federal courts to "Cases" and "Controversies." To ensure the presence of a "case" or "controversy, " a plaintiff must show that (1) it personally suffered an actual or threatened injury; (2) the injury is fairly traceable to the defendant's illegal conduct; and (3) the injury is likely to be redressed by a favorable decision. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992); Valley Forge Christian Coll. v. Ams. United for Separation of Church & State Inc., 454 U.S. 464, 472 (1982). A plaintiff's "injury in fact" must amount to an invasion of a legally protected interest which is (a) "concrete and particularized" and (b) "actual or imminent, not conjectural or hypothetical." Lujan, 504 U.S. at 561. However, where "the acts necessary to make the injury happen are at least partly within the plaintiff's own control, " the Supreme Court has "insisted that the injury proceed with a...
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