Prof'l Towing & Recovery Operators of Ill. v. Box

• Citation: 965 F.Supp.2d 981
• Decision Date: 16 August 2013
• Docket Number: Case No. 08–cv–4096.
• Parties: PROFESSIONAL TOWING & RECOVERY OPERATORS OF ILLINOIS, et al., Plaintiffs, v. Charles E. BOX, in his official capacity as Chairman of the Illinois Commerce Commission & Transportation Division, Defendant.
• Court: U.S. District Court — Northern District of Illinois

965 F.Supp.2d 981

PROFESSIONAL TOWING & RECOVERY OPERATORS OF ILLINOIS, et al., Plaintiffs,

v.Charles E. BOX, in his official capacity as Chairman of the Illinois Commerce Commission & Transportation Division, Defendant.

Case No. 08–cv–4096.

United States District Court,

N.D. Illinois,

Eastern Division.

Aug. 16, 2013.

Preempted

625 ILCS 5/18d-120(a)

625 ILCS 5/18d-125

625 ILCS 5/18d-150

625 ILCS 5/18d-160

625 ILCS 5/18d-165

Donald S. Rothschild, Brian Michael Dougherty, Goldstine, Skrodzki, Russian, Nemec & Hoff, Ltd., Burr Ridge, IL, Michael P. McGovern, The McGovern Law Firm, Knoxville, TN, for Plaintiffs.

Thomas A. Ioppolo, Chicago, IL, Alice Elizabeth Keane, Michael T. Dierkes, Illinois Attorney General's Office, Chicago, IL, for Defendant.

MEMORANDUM OPINION

ROBERT M. DOW, JR., District Judge.

The parties' cross-motions for summary judgment ask the Court to decide whether Illinois' Commercial Safety Towing Law (Towing Law), 625 ILCS 5/18d–101, et seq. is preempted in whole or in part by the Federal Aviation Administration Act of 1994 (FAAAA), as amended by the Interstate Commerce Commission Termination Act, 49 U.S.C. § 14501(c), because the it has “the force and effect of law related to a price, route, or service of any motor carrier * * * with respect to the transportation of property,” but is not part of “the safety regulatory authority of a State with respect to motor vehicles,” or whether a dispute over material facts precludes summary judgment. For the reasons stated below, the Court concludes that Towing Law sections 18d–120(a), 18d–125, 18d–150, 18d–160 and 18d–165 are preempted by federal law. The remainder of the Towing Law “is complete in and of itself, and is capable of being executed wholly independently of the severed portion,” People v. Sanders, 182 Ill.2d 524, 231 Ill.Dec. 573, 696 N.E.2d 1144, 1149 (1998), and so the Towing Law is not preempted in its entirety. Accordingly, the parties' cross-motions for summary judgment [100, 101] are granted in part and denied in part.

I. Background

This case concerns a sometimes-dangerous towing scam known as “wreck chasing,” Illinois' attempt to combat wreck chasing with towing regulations, and whether those regulations can remain in force despite a federal law that preempts state laws “related to a price, route, or service of any motor carrier * * * with respect to the transportation of property.” 49 U.S.C. § 14501(c); City of Columbus v. Ours Garage & Wrecker Serv., Inc., 536 U.S. 424, 430, 122 S.Ct. 2226, 153 L.Ed.2d 430 (2002) (“Tow trucks * * * are ‘motor carrier[s] of property’ falling within § 14501's compass.”).

The concept of a “wreck chaser” applies to towers and towing companies that do a variety of bad things, including: (1) monitoring police scanners to find accidents, (2) speeding to accident sites to solicit business; (3) using strong-arm tactics with owners and operators; (4) brawing with competing towers who get in their way; (5) towing damaged cars to undisclosed locations; (6) providing car owners and operators with phone numbers that go directly to an answering service and not their tow lots; (7) holding cars longer than necessary; (8) summoning owners and operators to desolate areas to recover vehicles; and (9) charging exorbitant fees, often more than $1,000, and (10) requiring payment in cash. The Court has no information about how many wreck chasers hit all those points, but even entities that hit some of them may be worthy of the name. A tower that solicits a tow at the scene of an accident, tows the car without honestly disclosing how much the tow will cost or where the vehicle will be towed, and charges an exorbitant fee to recover the car probably has done enough to earn the designation. The parties have documented that towers of this sort cause economic harms ( e.g., exorbitant fees) and makes the roads less safe ( e.g., speeding to accident scenes, creating disorder at the roadside).

The Commercial Safety Towing Law, 625 ILCS 5/18d–101, et seq. is part of Illinois' response to wreck chasing.¹ It regulates “commercial vehicle safety relocators,” which it defines as persons or entities “engaged in the business of removing damaged or disabled vehicles from public or private property by means of towing or otherwise, and thereafter relocating and storing such vehicles.” 625 ILCS 5/18d–105. The law applies in counties with a population of more than one million and in counties with a population under one million that have adopted the Commercial Relocation of Trespassing Vehicles Law, 625 ILCS 5/18a; 625 ILCS 5/18d–180. Under that rule, the Towing Law applies in 5 of Illinois' 102 counties: Cook, Will, Kane, DuPage, and Winnebago. Its substantive provisions can be summarized as follows:

• Sections 18d–115 and 145 require towing companies engaged in consensual towing ² to obtain a safety relocator's registration certificate from the Illinois Commerce Commission, for which the companies must pay both an annual and a per-vehicle fee, and require the certificate to be carried in each tow truck;

• Section 18d–120(a) requires towing companies to request specific authorization after the disclosures set forth in 18b–120(b) but prior to towing a damaged or disable vehicle;

• Section 18d–120(b) and (d) require towing companies to provide specific and detailed written disclosures to vehicle owners or operators before towing a damaged or disabled vehicle, and if the owner cannot receive the disclosures then they must be given to local law enforcement and, if known, the owner or operator's insurance company;

• Section 18d–120(c) requires towing companies to maintain copies of completed disclosures for a minimum of five years;

• Section 18d–120(e) prohibits towing companies from seeking any compensation from the vehicle owner or operator and voiding any contracts between the vehicle owner or operator and the tower if the tower fails to comply with section 18d–120(a)-(d);

• Section 18d–125 requires towing companies to issue an itemized final invoice to vehicle operators or owners upon demand and to retain copies of such invoices for a period of five years;

• Section 18d–130 requires towing companies to post signs at their storage facilities advising customers of their rights;

• Section 18d–135 imposes penalties for violations of the recordkeeping requirements in sections 18d–120(b) and 18d–125

• Section 18d–150 prohibits towing companies from including in their contracts with owners or operators of damaged or disabled vehicles clauses that waive or limit the towing companies' liability;

• Section 18d–155 imposes penalties and fines for failure to comply with the State Towing Law;

• Section 18d–160 makes noncompliance with the Towing Law an “unlawful practice” within the meaning of Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/1 et seq.; and

• Section 18d–165 requires that charges accrued by vehicle owners or operators for consensual tows to be payable by cash or major credit card.

The law is prefaced by a statement of “[p]ublic interest and public welfare”:

The General Assembly finds and declares that commercial vehicle towing service in the State of Illinois fundamentally affects the public interest and public welfare. It is the intent of the General Assembly, in this amendatory Act of the 95th General Assembly, to promote the public interest and the public welfare by requiring similar basic consumer protections and fraud prevention measures that are required of other marketplace participants, including the disclosure of material terms and conditions of the service to consumers before consumers accept the terms and conditions. The General Assembly also intends that the provisions in this amendatory Act of the 95th General Assembly promote safety for all persons and vehicles that travel or otherwise use the public highways of this State. The General Assembly finds that it is in the public interest that persons whose vehicles are towed from the public highways know important basic information, such as where they can retrieve their vehicles and the cost to retrieve their vehicles, so that they can avoid vehicle deterioration and arrange for a prompt repair of the vehicles.

625 ILCS 5/18d–110 (emphasis added). Thus, on its face, the Towing Law has a mixed purpose: it aims to protect consumers and promote safety. The law's purpose matters for the Court's preemption analysis because even if a provision of the Towing Law is “related to a price, route, or service” of a tower, and so falls within the general scope of 49 U.S.C. § 14501(c), it will be saved from federal preemption if it is “genuinely responsive to safety concerns” and not by virtue of its reasonableness or effectiveness as a measure combating consumer confusion or fraud, see Ours Garage, 536 U.S. at 442, 122 S.Ct. 2226 (emphasis added); 49 U.S.C. § 14501(c)(2).

The mixed purpose set out in the Towing Law's statement of public interest and public welfare is mostly absent from the law's (rather sparse) legislative history, which is focused primarily on consumer protection. When the bill that would eventually become the Towing Law was introduced to the General Assembly on February 8, 2007 as Senate Bill 435 (SB435), it was titled “Truth in Towing” and contained a variety of consumer-disclosure requirements intended to address unfair towing practices. On February 23, 2007, the first Senate amendment to SB435 proposed, among other things, requiring the Illinois Commerce Commission to set rates for towing damaged or disabled vehicles and changing section 2Z of the Consumer Fraud and Deceptive Business Practices Act (“ICFA”), 815 ILCS 505/2Z to make violations of certain sections of Chapter 18a (which would include the “Truth in Towing Law”) a violation of ICFA. On March 29, 2007, Senator Maloney, one of SB435's sponsors, told the Senate that the bill “was precipitated by the fact that there are many unscrupulous towing companies out there who take...