Petry v. City of Toledo

• Citation: 246 F.3d 548
• Decision Date: 29 November 2000
• Docket Number: No. 99-4441,99-4441
• Parties: (6th Cir. 2001) Anna S. Petrey, d/b/a Magnum Towing, Plaintiff-Appellee, v. City of Toledo, Defendant-Appellant. Argued:
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

Page 548

246 F.3d 548 (6th Cir. 2001)

Anna S. Petrey, d/b/a Magnum Towing, Plaintiff-Appellee, v. City of Toledo, Defendant-Appellant.

No. 99-4441

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

Argued: November 29, 2000

Decided and Filed: April 2, 2001

Appeal from the United States District Court for the Northern District of Ohio at Toledo. No. 98-07188, James G. Carr, District Judge. [Copyrighted Material Omitted] John D. Latchney, REMINGER & REMINGER, Cleveland, Ohio, for Appellee.

James G. Burkhardt, OFFICE OF THE CITY OF TOLEDO LAW DEPARTMENT, Toledo, Ohio, for Appellant.

Before: DAUGHTREY and MOORE , Circuit Judges; CLELAND , District Judge^*.

OPINION

KAREN NELSON MOORE, Circuit Judge.

Defendant, City of Toledo ("City" or "Toledo"), appeals the district court's order granting plaintiff-appellee Anna Petrey's motion for summary judgment with respect to her claim that various Toledo towing ordinances must be struck down under the preemption doctrine because they conflict with a federal statute, 49 U.S.C. §14501(c). Toledo also appeals the district court's decision granting summary judgment to Petrey on her claim that Toledo's violation of 49 U.S.C. §14501(c) constituted a denial of her federal rights for which relief is available pursuant to 42 U.S.C. §1983.

We AFFIRM in part and REVERSE in part the district court's decision in this case.

I. BACKGROUND

On April 3, 1998, Anna Petrey filed suit against the City of Toledo challenging the legality of the City's municipal towing provisions. See Toledo, Ohio, Mun. Code ch. 765 (1998). Petrey contends that a series of Toledo's towing ordinances are preempted by 49 U.S.C. §14501(c), a federal statute which provides, with some important exceptions to be discussed later, that "a State, political subdivision of a State, or political authority of 2 or more States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier with respect to the transportation of property."

Chapter 765 of the Toledo Municipal Code requires, with limited exceptions, that anyone operating a tow truck within the City obtain a towing license from the City's Director of Finance. Toledo Mun. Code §765.02(a)-(b) (1998)¹. Two types of licenses are available to tow truck drivers: Class A and Class B. Id. §765.02(a)(1), (2). A Class B license permits a tower to conduct private and third-party tows. Id. §765.02(a)(2). A Class A license, however, in addition to private and third-party tows, permits the holder to conduct non-consensual tows ordered by the Toledo Police Department. Id. §765.02(a)(1).

While both Class A and Class B applicants must meet certain requirements to be issued a license, the requirements for a Class A license are more onerous and expensive. To obtain a Class B license, an applicant must: 1) pay a filing fee, id. §765.06(a)(1); 2) furnish a certificate of insurance evidencing that the tower is insured up to at least the City's prescribed minimum coverage, id. §765.06(a)(2); 3) fill out an application listing general information about the business and its owners or partners, including any criminal record each owner or partner might have, id. §765.06(a)(3)-(4); and 4)maintain a storage facility within City limits if the tower is to perform third-party tows in the City. Id. §765.05(e)(4).

To obtain a Class A license, however, the applicant must: 1) pay a filing fee that is approximately four times as expensive as the Class B fee, id. §765.03(a)(1); 2) maintain significantly more insurance coverage, id. 765.03(a)(2); 3)ensure, for police tows only, the availability of at least three approved tow trucks, id. §765.03(b)(4); 4) provide storage space for a minimum of one hundred vehicles, at least twenty-three of which must be at the licensed premises, id. §765.03(b)(5); and 5) maintain a valid special use permit for any licensed premises and auxiliary storage site, id. §765.03(b)(7)². If all of the Class A license requirements have been met, then the Director of Public Safety must approve the application³.

The City is divided into a number of police towing districts, the amount and boundaries of which are also determined by the City's Director of Public Safety. Id. §765.07(a)-(b). Police towing work in each towing district is rotated among the Class A license holders in that district. Id. §765.07(c). For several years in the 1990s, the City had granted Class A licenses to the same eleven towing companies for all of the police towing in the city. See Rule of the Director of Public Safety No. 10034⁴.

Petrey's towing company, Magnum Towing, first began towing in 1991, and Petrey applied for and was issued a Class B towing license for that year. Petrey failed to renew her license in 1992 and 1993, however, and in 1994, one of Magnum's employees was cited for towing without a license. After renewing her Class B license following the citation, Petrey applied for a Class A license in March 1995. Plaintiff's application was denied both because she had not been legally conducting business in the City during the previous two years as required by Toledo's towing provisions, and because the Director of Public Safety had already limited the number of Class A licensees to eleven. Petrey also applied for a Class A license in both 1996 and 1997, and her applications were similarly rejected. In 1998, Petrey's application was returned to her because she had not provided the City with enough information to grant either a Class A or Class B permit.

On April 3, 1998, Petrey filed suit in the United States District Court for the Northern District of Ohio seeking, on the grounds of preemption, "declaratory and injunctive relief precluding the City from enforcing those portions of Toledo Municipal Code Chapter 765 which deny and have denied Magnum a 'Class A' license and the right to perform non-consensual police tows." Joint Appendix ("J.A.") at 21 (Am. Compl.). More specifically, Petrey challenged the following Toledo towing provisions, all but one of which pertain only to Class A license holders: the storage space requirement, §765.03(b)(5); the special use permit requirement, §765.03(b)(6); the requirement that all Class A license holders have been in the towing business in the Toledo area for two years prior to applying for a Class A license, §765.03(c)(3) (1997); the heavy equipment commercial driver's license requirement, §765.03(c)(5) (1997); the Rule of the Director of Public Safety limiting the number of Class A licensees to eleven, Rule No. 10034; and the general requirement that all Toledo tow truck drivers obtain a special towing license from the City, §765.02(c) (1997)⁵. J.A. at 238 (Pl.'s Mem. in Supp. of Summ. J.).

Petrey also sought compensatory and punitive damages pursuant to 42 U.S.C. §1983, alleging that the City, through its application of the towing provisions, had violated her equal protection and substantive due process rights. Petrey further claimed that the City had retaliated against her for exercising her First Amendment rights by selectively applying its towing provisions following her complaints about the Class A license requirements.

On February 16, 1999, the City of Toledo filed a motion for summary judgment as to Petrey's claims. The district court engaged in a lengthy preemption analysis and ultimately concluded that 49 U.S.C. §14501(c) permitted states, but not political subdivisions like the City of Toledo, to engage in safety regulation that had been exempted from the statute's general preemption provision. Petrey v. City of Toledo, 61 F. Supp. 2d 674, 676-80 (N.D. Ohio 1999). The district court further denied, without prejudice to renew, the City's motion for summary judgment as it pertained to Petrey's §1983 claims. Id. at 680. The district court granted, however, the City's motion for summary judgment with respect to Petrey's First Amendment claim. Id. Finally, the district court granted leave to Petrey to file a motion for summary judgment by June 30, 1999. Id. at 681.

On June 30, 1999, Petrey filed a motion for summary judgment with respect to her claim that Chapter 765 of the Toledo Municipal Code is preempted by 49 U.S.C. §14501(c). The City responded by renewing its motion for summary judgment with respect to Petrey's §1983 claims. On October 21, 1999, the district court granted Petrey's motion for summary judgment, stating that the Toledo towing ordinances were preempted and ordering that the City be permanently enjoined from enforcing the provisions specifically challenged in Petrey's motion for summary judgment. The district court denied the City's motion for summary judgment with respect to Petrey's §1983 claims, and, in light of its finding that Toledo's towing regulations were preempted by federal law, held that there was no genuine issue of material fact that Petrey was deprived of her federal right not to be regulated. Thus, the court held that the only issues left to be decided were the amount of damages, if any, that Petrey had suffered as a consequence of the City's regulations, and whether Petrey was entitled to recover attorneys' fees, expenses, and costs under 42 U.S.C. §1988. The district court further held that, pursuant to Fed. R. Civ. P. 54(b), there "was no just reason for delay of the City's appeal" of the permanent injunction prohibiting Toledo from enforcing its towing provisions. J.A. at 356 (D. Ct. Order, Dec. 16, 1999). The City's appeal to this court followed. Pending appeal to this court, the district court, noting that the City had granted Petrey a Class A license for the course of the litigation, ordered a stay of its previous order enjoining the City from enforcing certain sections of its towing regulations.

II. ANALYSIS

A. Standard of Review

This court reviews de novo a district court's decision to grant summary judgment. Thomas v. United States, 213 F.3d 927, 929 (6th Cir. 2000). The moving party has...