Park Shuttle N Fly v. Norfolk Airport Authority

Decision Date09 December 2004
Docket NumberNo. CIV.A. 2:03CV461.,CIV.A. 2:03CV461.
CourtU.S. District Court — Eastern District of Virginia
PartiesPARK SHUTTLE N FLY, INC., Plaintiff, v. NORFOLK AIRPORT AUTHORITY, NORFOLK INTERNATIONAL AIRPORT, Defendant.

Steven R. Zahn, McGuirewoods LLP, Norfolk, VA, Theodore Frank Schwartz, Law Offices of Theodore F. Schwartz, Clayton, MO, for Plaintiff.

Anita Owings Poston, Vandeventer Black LLP, Norfolk, VA, for Defendant.

MEMORANDUM OPINION AND ORDER

JACKSON, District Judge.

The Court held a bench trial in the above-captioned matter on September 9, 2004. Having conducted a trial and thoroughly reviewed the evidence, arguments, and records in this case, the Court finds that this case is ripe for decision. For the reasons stated below, the Court awards judgment for the DEFENDANT.

I. PROCEDURAL HISTORY AND FACTUAL FINDINGS
A. Procedural History

The Plaintiff, Park Shuttle N Fly, Inc. ("Park Shuttle"), brought suit on June 30 2003 alleging that the Defendant, Norfolk Airport Authority ("Authority"), had imposed an invalid privilege fee upon it for its use of the airport's facilities. The complaint alleged violations of the Due Process, Equal Protection, and the Commerce clauses of the United States Constitution. The complaint stemmed from an Authority regulation imposed in May 2003 that required off-airport parking operators to pay a fee of 8% of the operators' gross monthly revenue for the privilege of accessing airport property to pick up or discharge customers. The Plaintiff alleged that this fee was different from the lump sum fee that other courtesy vehicle operators were required to pay, including hotels, taxis, and limousine services, among others. It also alleged that the amount of fee the Authority imposed was an "arbitrary, discriminatory, and artificial classification" that imposed an undue burden on interstate commerce and violated the due process and equal protection clauses of the Constitution. (Pl. Compl. at ¶ 11).

The Defendant filed a Motion to Dismiss on August 18, 2003 on the grounds that Plaintiff's complaint failed to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6), and in the alternative for Summary Judgment on the Commerce Clause claim. On February 6, 2004 this Court granted Defendant's Motion to Dismiss Plaintiff's Equal Protection claim which alleged that Park Shuttle was treated differently than hotels, and the Due Process Claim. It denied Defendant's Motion to Dismiss the challenge to the amount of user fee charged and to the prohibition of Park Shuttle to pick up passengers which do not have prior arrangements with the company. It also denied the Motion to Dismiss and Summary Judgment on the Commerce Clause claim.

The Court also made several findings that are relevant to the analysis here. The Court found that the revenues Plaintiff paid to Defendant constitute a usage fee rather than a state-imposed tax. Park Shuttle N Fly, Inc. v. Norfolk Airport Auth., No. 2:03cv461, at *7 (February 6, 2004). In addition, the Court found that state law allows the Authority to impose usage fees of some kind, thus establishing a legitimate purpose for the regulation.

After the Court's decision, the Plaintiff filed its First Amended Complaint for Declaratory Judgment, Preliminary Injunction, Permanent Injunction and Other Relief ("Pl.Am.Compl."). The Amended Complaint reiterated the initial allegations regarding the Equal Protection, Due Process, and Commerce Clause claims, and added a claim alleging a violation of Free Speech and Equal Protection. The Plaintiff newly alleged that Defendant denied Plaintiff the opportunity to advertise in the concourses of the airport terminals, while other commercial entities were allowed to advertise.

B. Factual Findings
1. Stipulated Facts

The Plaintiff, Park Shuttle is a duly organized and existing Virginia corporation engaged in the business of operating a parking lot in close proximity to the Norfolk International Airport ("Airport"), which parking lot is used by persons traveling in interstate commerce by using the flight facilities at said Airport. (Final Pre-Trial Order at ¶ 1). The Norfolk Airport Authority ("Authority") is a political subdivision of the Commonwealth of Virginia and is an independent body that owns and operates the Airport pursuant to state law and the Code and Charter of the City of Norfolk. For purposes of this litigation, the Authority operates in its proprietary capacity and not in its governmental or regulatory capacity. (Final Pre-Trial Order at ¶ 2). The Authority is governed by a Board of Commissioners (the "Board"), which oversees the general operation and management of the Airport. At all relevant times, the Chairman of the Board is and has been Richard D. Roberts. As Chairman of the Board, Mr. Roberts is familiar with the overall operational, business, and financial aspects of the Airport and the Authority. Mr. Roberts presides at its meetings and activities. The other members of the Board are: Peter G. Decker, Jr., Esquire; Louis F. Ryan, Esquire; Thomas P. Host, III; Dr. Harold J. Cobb, Jr.; Robert D. Jack, Jr.; Gus J. James, II, Esquire; Robert T. Taylor; and Howard M. Webb, Sr. (Final Pre-Trial Order at ¶ 3). At all material times, the Executive Director of the Authority is and has been Kenneth R. Scott. As Executive Director, Mr. Scott is the highest-ranking employee and officer of the Authority. Mr. Scott reports to the Board. Mr. Scott is responsible for all day-to-day operations and management of the Airport, as well as strategic and financial planning. (Final Pre-Trial Order at ¶ 4).

The Airport is served by major airlines, including American, Continental, Delta, Northwest, Southwest, United, U.S. Airways, or their subsidiaries and affiliates. From 1998 through 2002, on average, approximately 3,079,470 passengers flew into and out of the Airport per year. This figure does not include people who come to the Airport to meet passengers or for other purposes. With the exception of 2001 (during which the September 11 terrorist attacks occurred), the number of passengers has increased every year. (Final Pre-Trial Order at ¶ 6). All passengers arriving at and departing from said Airport use automotive surface transportation for purposes of ingress and egress to and from the Airport facilities. (Final Pre-Trial Order at ¶ 7). Automotive surface transportation at the Airport, other than personal automobiles, consists of common carrier buses, limousines, taxi cabs, shuttles, and vehicles commonly denominated as "courtesy vehicles", which pick up and discharge customers of hotels, parking lots, motels, and car rental agencies. (Final Pre-Trial Order at ¶ 8).

A substantial portion of the traveling passengers using the facilities of the Airport reach the facilities by driving their automobiles or by taking limousines, taxi cabs, shuttles and courtesy vehicles. (Final Pre-Trial Order at ¶ 9). The Authority owns and operates the parking facilities located on Airport property. There are three parking lots and three parking garages on the Airport, containing a total of approximately 6,800 spaces. (Final Pre-Trial Order at ¶ 10).

At present, Park Shuttle operates the only known off-Airport parking facility. The Park Shuttle lot is located on Military Highway, approximately 1.5 miles from the main entrance to the Airport. (Final Pre-Trial Order at ¶ 11). The travelers who park their automobiles off the Airport on Park Shuttle's facility are then provided transportation to and from Park Shuttle's parking lot and the Airport by means of Park Shuttle's courtesy vehicles. Plaintiff's courtesy vehicles also transport its customers' luggage and drop off Park Shuttle's customers and luggage at the appropriate check-in and baggage check-in facility. The Authority's parking facility provides no such transportation of customers' luggage to the appropriate airline terminal. (Final Pre-Trial Order at ¶ 12). On an annual basis, more than 90% of Park Shuttle's revenues are generated from customers who are parking on Park Shuttle's property for the purpose of accessing the Airport and thereby traveling in interstate commerce. If the Airport did not exist, Plaintiff would have too few, if any, customers to operate its parking facility. (Final Pre-Trial Order at ¶ 13). Hotels located near the Airport provide courtesy vehicles to transport customers to the Airport. (Final Pre-Trial Order at ¶ 14).

On May 22, 2003, at its regularly scheduled meeting, the Board of Commissioners of the Authority adopted the Resolution Establishing Regulations and Fees for Off-Airport Public Parking Operators at Norfolk International Airport ("Resolution"). (Final Pre-Trial Order at ¶ 15). The Resolution provides, among other things, that all off-Airport parking operators shall pay a fee of 8% of the operator's gross monthly revenue derived from its customers who are transported to or from the Airport (the "Privilege Fee") for the privilege of accessing Airport property to pick up or discharge customers. The Resolution went into effect on July 1, 2003. (Final Pre-Trial Order at ¶ 16). At present, the Privilege Fee does not apply to vehicles operated by hotels, or to limos, taxi cabs or any other private or public vans transporting passengers to the Airport. Rather, such other businesses pay a different permit fee. (Final Pre-Trial Order at ¶ 17). The Authority has imposed a privilege fee of 8% of gross revenues for off-Airport rental car companies. At present, all rental car companies are located on the Airport and pay fees pursuant to concession agreements with the Authority. However, the Privilege Fee would apply to vehicles operated by an off-Airport rental car company in the event such a company were to open for business. (Final Pre-Trial Order at ¶ 18). The Authority does not require itself to pay a percentage of its gross revenue as required by the Authority of...

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