Ourbus v. City of Ithaca

• Decision Date: 28 June 2019
• Docket Number: Civil Action No. 3:19-CV-0356 (DEP)
• Parties: OURBUS, INC. Plaintiff, v. CITY OF ITHACA, NEW YORK, et al., Defendant.
• Court: U.S. District Court — Northern District of New York

OURBUS, INC.Plaintiff, v. CITY OF ITHACA, NEW YORK, et al., Defendant.

Civil Action No. 3:19-CV-0356 (DEP)

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF NEW YORK

June 28, 2019

APPEARANCES:

FOR PLAINTIFF:

LAW OFFICE OF

STEVEN A. DIAZ

2200 Pennsylvania Avenue, NW

Fourth Floor, East Tower

Washington, DC 20037

RIVKIN RADLER LLP

9 Thurlow Terrace

Albany, NY 12203

HUGHES LAW OFFICE

42-65 Kissena Blvd., Suite 609

Flushing, NY 11355-3267

FOR DEFENDANT:

SMITH, SOVIK, KENDRICK

& SUGNET, P.C.

250 S. Clinton Street, Suite 600

Syracuse, NY 13202

OF COUNSEL:

STEVEN A. DIAZ, ESQ.

JAMES P. LAGIOS, ESQ.

MARK J. WAGNER, JR., ESQ.

LAWRENCE F. HUGHES, ESQ.

EDWARD J. SMITH, III, ESQ.

KAREN G. FELTER, ESQ.

DAVID M. KATZ, ESQ.

DAVID E. PEEBLES CHIEF U.S. MAGISTRATE JUDGE

DECISION AND ORDER

PlaintiffOurBus, Inc.("OurBus" or "plaintiff") is a broker engaged in arranging for the transportation of passengers, including to and from Ithaca, New York, utilizing the services of federally-registered motor carriers.OurBus has commenced this action against defendantCity of Ithaca("City") and various City officials and employees, alleging that, inter alia, through enactment and implementation of an ordinance adopted by its Common Council, the City has unlawfully restricted access by OurBus, for purposes of dropping off and picking up passengers, to a bus stop previously utilized by buses engaged by the company.Plaintiff argues that through its actions, the City has unlawfully discriminated against OurBus and placed an undue burden upon interstate commerce, and that the ordinance at issue is preempted by a federal law governing interstate motor carriers.

Currently pending before the court is an application by OurBus for a temporary restraining order and preliminary injunction precluding the City from enforcing the ordinance and denying plaintiff access to the pick-up and drop-off point previously utilized under color of the ordinance.Because OurBus has failed to demonstrate either a likelihood of success on the merits of its claims or that it will suffer irreparable harm if an injunction is not issued in its favor, and further based upon my finding that the issuance of an injunction would not serve the public's interest, plaintiff's motion is denied.The following constitutes my findings of fact and conclusions of law.

I.BACKGROUND

A.City of Ithaca

The City of Ithaca is located in Upstate New York, and within the Northern District of New York.Two large collegiate institutions, Cornell University and Ithaca College, are located within the limits of the City.Evidentiary Hearing Transcript ("Tr.") 222.While the City's population numbers approximately thirty thousand people, that number doubles when students are present at those two institutions.Tr. 222-23.One witness described the City as "unique" with its "challenging" topography, hills, small intersections, and narrow residential streets.Tr. 222.

Several different bus companies operate within the City.The Tompkins Consolidated Area Transit ("TCAT"), a not-for-profit organization that is partially owned by the City, provides local transit services to both the City and the surrounding areas of Tompkins County.Tr. 15, 110.TheCity is also serviced by several privately-owned motor carriers of passengers that provide intercity service, including Greyhound Lines, Inc.("Greyhound"), Passenger Bus Corporation("New York Trailways"); and Chenango Valley Bus Lines, Inc.("ShortLine" or "Coach USA")(collectively, the "Legacy Carriers").Tr. 23, 33.In addition to TCAT and the Legacy Carriers, OurBus, a broker of passenger transportation, provides intercity services to the City.

B. OurBus

OurBus is a Delaware corporation formed in 2016 and headquartered in New York City.Tr. 6.According to company's co-founder, Axel Hellman, OurBus is a "transportation technology company," engaged in the business of brokering passenger transportation by bus to and from various locations, with regular stops in New York, Massachusetts, Connecticut, Pennsylvania, Maryland, and the District of Columbia.Tr. 6, 8.It appears that at least initially, and during the relevant time period, OurBus provided service for a single route from the City to New York City and back.Exh. P-1at 4.That route is interstate, since it traverses through Pennsylvania and New Jersey.Tr. 8.

Because it is a broker of transportation services, rather than a federally-registered motor carrier, OurBus neither owns any buses norcontrols any of the motor carriers with whom it contracts.Tr. 6-8.Rather, the function of OurBus is to connect passengers seeking transportation with motor carriers registered with the Federal Motor Carrier Safety Administration ("FMCSA") to provide that transportation.Tr. 6-8.The services offered by OurBus include route planning, marketing, customer service, and ticket sales.Tr. 7.

When OurBus sells tickets to passengers, it submits a portion of the fees collected to the motor carrier providing that transportation and then realizes, as a gross profit, the difference between the fares paid by the passengers and the fees remitted to the motor carrier.Dkt. No 2-1at 2-3.Officials for the City agree that "OurBus is valuable to the City" because it provides a low cost transportation option, particularly to its large student population.Tr. 329.

Unlike the Legacy Carriers, OurBus does not utilize a paper ticketing system.¹Tr. 36.Instead, passengers can purchase electronic tickets through the OurBus website or a mobile application.Tr. 9.Each electronicticket issued displays the name of the motor carrier assigned, as well as the Department of Transportation("DOT") and Motor Carrier ("MC") numbers of the bus to be utilized for the route.Tr. 11.Although OurBus utilizes the services of a range of different motor carriers to provide transportation to its customer base, it relies primarily upon three motor carriers: (1) Hampton Jitney of Calverton, Long Island, (2) Martz Trailways of Pennsylvania,² and (3) Field Trips 101, which does business as Fitzgerald Brothers of Geneva, New York.Tr. 45-46.

C.Section 346-31 of the City of Ithaca Municipal Code

In March 2001, the City's Common Council enacted section 346-31 of the City of Ithaca Municipal Code as part of an overall scheme to promote traffic control, eliminate traffic congestion, and ensure the safety of passengers and pedestrians in and around the streets of the City.See generallyDkt.No. 30-4.In relevant part, that section provides as follows:

Unless otherwise provided to the contrary, no bus or common carrier, whether for hire or not, shall be operated upon, stop on or stand on any City street in the corporate limits of the City of Ithaca, nor shall such bus or common carrier pick up or discharge passengers on any such City street or curb, or any other public property, or at or within 200 feet of any City bus stop in said corporate limits of the City ofIthaca, unless a permit is obtained therefor from the Common Council of the City of Ithaca, or its designee, the issuance of which permit shall be at the sole discretion of the Common Council of the City of Ithaca.

City of Ithaca Municipal Code§ 346-31(A).

Historically, section 346-31 was not construed as requiring the Legacy Carriers to obtain a permit because although they"operated upon" the City's streets, those companies utilized a then-existing, privately-owned bus terminal to embark and disembark passengers.Exh. P-8at 4-5;see infra Point II.E.Accordingly, the Legacy Carriers "did not pose the same potential hazards contemplated by the Code[,] including traffic congestion, interruption of passage of emergency vehicles, and disruption of public bus stops."Exh. P-8at 4.Likewise, the ordinance was not historically construed as applying to TCAT because that entity "functions as the City's public transit system."Id. at 5;see alsoTr. 135.

D. 131 East Green Street and the Initial OurBus Permit

At the center of this dispute is an intercity bus stop, located partially along the frontage of 131 East Green Street and in front of an Urban Outfitters storefront.Tr. 28-29, 229-30.That bus stop is located in a congested area in the heart of the City, and in close proximity to "The Commons," a pedestrian zone that is closed to vehicular traffic(hereinafter, the "pedestrian mall").Tr. 14, 25, 223.The bus stop, labeled Ⓐ, and surrounding area are generally depicted on the following map:³

Image materials not available for display.

East Green Street, which is immediately south of the pedestrian mall, and East Seneca Street, which is immediately north of the pedestrian mall, together form a portion of New York State Route 79, an east-west statehighway that represents a main thoroughfare in and out of the City.Tr. 107.East Green is an eastbound, one-way street, while East Seneca Street is a westbound, one-way street.Tr. 26, 56, 155-56.

As it is presently configured, two full-size motor coaches can fit within the bus stop at 131 East Green Street, although the City initially and incorrectly believed that the space was capable of accommodating three buses.⁴Tr. 27, 73, 140, 144, 335.East Green Street does not currently have a bicycle lane, although once construction on East Green Street ends, which is anticipated for August of this year, a five-foot wide bicycle lane will be restored between the driving lanes of the street and the bus stop at 131 East Green Street.Tr. 73, 142.Once this bicycle lane reopens, the space at 131 East Green Street will not be able to accommodate more than one bus at a time.Tr. 73, 140-41, 144, 335.

There are several businesses in the immediate vicinity of the 131 East Green Street bus stop, which as will be seen, create unique challenges for the area.To the immediate east of the bus stop is a mental health facility, which is labeled on the map as ?.Tr. 35-36(citingExh. P-13).While it does not appear that the facility has adjacent parking for itspatrons, it does have a curb cut...