Travis v. Reno

• Decision Date: 16 December 1998
• Docket Number: No. 98-2881,98-2881
• Citation: 163 F.3d 1000
• Parties: 27 Media L. Rep. 1080 David M. TRAVIS, et al., Plaintiffs-Appellees, v. Janet RENO, Attorney General of the United States, and United States of America, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1000

163 F.3d 1000

27 Media L. Rep. 1080

David M. TRAVIS, et al., Plaintiffs-Appellees, v. Janet RENO, Attorney General of the United States, and United States of America, Defendants-Appellants.

No. 98-2881.

United States Court of Appeals Seventh Circuit.

Argued Nov. 12, 1998.

Decided Dec. 16, 1998.

Jon Deitrich, Adelman, Adelman & Murray, Milwaukee, WI, for David M. Travis, Fred A. Risser, Robert K. Zukowski.

James E. Doyle, Susan K. Ullman, Office of the Atty. Gen., Madison, WI, for Roger D. Cross, Wisconsin Dept. of Transp.

Craig M. Blackwell, Mark B. Stern, Dept. of Justice Civil Div., Washington, DC, for Janet Reno, U.S.

Thomas H. Odom, Arter & Hadden, Washington, DC, Bill Pryor, Office of the Atty. Gen., Jack Curtis, Dept. of Public Safety, Montgomery, AL, for State of Alabama.

Thomas H. Odom, Arter & Hadden, Washington, DC, W.A. Drew Edmondson, Office of the Atty. Gen., Oklahoma City, OK, John K. Lindsey, Dept. of Public Safety, Oklahoma City, OK, for State of Oklahoma.

Anne Miyako Hayes, Pacific Legal Foundation, Sacramento, CA, for Pacific Legal Foundation.

Before FLAUM, EASTERBROOK, and KANNE, Circuit Judges.

EASTERBROOK, Circuit Judge.

This case poses the question whether Congress has the power to enact the Driver's Privacy Protection Act, 18 U.S.C. §§ 2721-25, which regulates disclosures of the information that states maintain in drivers' records. The district court held that the Act exceeds Congress' authority under the commerce clause (read in light of the tenth amendment) because the Act commandeers states to do the national government's bidding. 12 F.Supp.2d 921 (W.D.Wis.1998). After the district court released its opinion, the fourth circuit concluded that the Act is unconstitutional because it applies exclusively to states. Condon v. Reno, 155 F.3d 453 (4th Cir.1998). But the tenth circuit has disagreed and held that the Act is valid. Oklahoma v. Reno, 161 F.3d 1266 (10th Cir.1998), reversing 994 F.Supp. 1358 (W.D.Okla.1997). Accord, Pryor v. Reno, 998 F.Supp. 1317 (M.D.Ala.1998). Although each side to this controversy can take comfort from decisions of the Supreme Court, we conclude that, whatever may be said about the Act's wisdom, it is within the commerce power and compatible with constitutional principles of federalism. This eliminates any need to discuss whether the Act also is within the legislative power under § 5 of the fourteenth amendment.

I

The Act forbids the disclosure of "personal information about any individual obtained by the [State's] department [of motor vehicles] in connection with a motor vehicle record" except to the extent that the Act itself permits or requires disclosure. 18 U.S.C. § 2721(a). Elsewhere the Act requires disclosure for law enforcement and pollution-control uses; forbids disclosure for commercial uses (such as the creation of mailing lists); and makes disclosure optional for other uses, such as research and insurance. Violations of the Act are punishable by fines up to $5,000 per day. 18 U.S.C. § 2723. Wisconsin contends, and we must assume, that in order to comply with the Act it must make costly changes in the way it handles requests for access to its motor vehicle licensing records. Moreover, because Wisconsin formerly sold its records for use in creating mailing lists, and for other purposes, the Act deprives the state of approximately $8 million in annual revenue. ("Wisconsin" is shorthand for the state's Division of Motor Vehicles and its director, who intervened as plaintiffs after questions were raised about the standing of the original plaintiffs. The Division, as the regulated entity, has an Article III controversy with the United States, so we need not discuss the original plaintiffs' standing.)

A

Driving is an interstate activity, as is the mailing-list business. Information about Wisconsin's drivers readily can affect movement and business transactions outside that state's borders. Wisconsin does not doubt that, but for the principles of state sovereignty that underlie our Nation's federal structure (and are acknowledged by the tenth and eleventh amendments), Congress would possess power under Art. I § 8 cl. 3 of the Constitution to enact this statute. The interstate components are substantial in the aggregate even if a single disclosure has but a slight effect on commerce. See United States v. Lopez, 514 U.S. 549, 558-61, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995); Wickard v. Filburn, 317 U.S. 111, 63 S.Ct. 82, 87 L.Ed. 122 (1942); United States v. Hicks, 106 F.3d 187 (7th Cir.1997).

Nonetheless, ever since McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316, 4 L.Ed. 579 (1819), the Supreme Court has recognized that suppositions implicit in the structure of the Constitution limit the power of the states to tax or regulate the national government. The intergovernmental tax immunity doctrine that Chief Justice Marshall articulated in McCulloch (and that the Court extended in Collector v. Day, 78 U.S. (11 Wall.) 113, 20 L.Ed. 122 (1871), and Pollock v. Farmers' Loan & Trust Co., 157 U.S. 429, 15 S.Ct. 673, 39 L.Ed. 759 (1895), to federal taxation of states and their contractors) foreclosed all taxation of a governmental body or its instrumentalities on the ground that the power to tax is the power to destroy, a rationale equally applicable to the imposition of costly regulation. (It is through the power to regulate the movement of goods in interstate commerce that Congress has forbidden child labor, United States v. Darby, 312 U.S. 100, 61 S.Ct. 451, 85 L.Ed. 609 (1941), and for a time prohibited lotteries. Lottery Case, 188 U.S. 321, 23 S.Ct. 321, 47 L.Ed. 492 (1903).) Gradually intergovernmental immunity turned into a rule of nondiscrimination, under which the governmental body's protection is vicarious: one government may tax (or regulate) another's trading partners only to the extent it imposes equivalent burdens on those who do business with private citizens. See South Carolina v. Baker, 485 U.S. 505, 515-27, 108 S.Ct. 1355, 99 L.Ed.2d 592 (1988). Neutrality between governmental and private spheres is a principal ground on which the Supreme Court has held that states may be subjected to regulation when they participate in the economic marketplace--for example, by hiring workers covered by the Fair Labor Standards Act. Garcia v. San Antonio Metropolitan Transit Authority, 469 U.S. 528, 105 S.Ct. 1005, 83 L.Ed.2d 1016 (1985); Maryland v. Wirtz, 392 U.S. 183, 88 S.Ct. 2017, 20 L.Ed.2d 1020 (1968). See also South Carolina, 485 U.S. at 511-15, 108 S.Ct. 1355 (states may be required to issue bonds in registered form); United Transportation Union v. Long Island R.R., 455 U.S. 678, 102 S.Ct. 1349, 71 L.Ed.2d 547 (1982) (labor laws apply to state-owned railroads); Fry v. United States, 421 U.S. 542, 95 S.Ct. 1792, 44 L.Ed.2d 363 (1975) (states are bound by generally applicable wage and price controls). So long as public market participants are treated the same as private ones, they enjoy the protection the latter have been able to secure from the legislature; and as Congress is not about to destroy private industry (think what that would do to the tax base!) it can not hobble the states either. National League of Cities v. Usery, 426 U.S. 833, 96 S.Ct. 2465, 49 L.Ed.2d 245 (1976), adopted a proviso to this approach: that Congress may not disrupt the states' ability to manage core governmental functions such as police and fire protection. Garcia overruled National League of Cities after concluding that the set of traditional or essential governmental functions is too indistinct to be a constitutional norm. Even if Garcia should be overruled in turn, this branch of analysis would do Wisconsin no good. Nothing in the Driver's Privacy Protection Act interferes with states' ability to license drivers and remove dangerous ones from the road; it regulates external rather than internal uses of the information.

Alongside the prohibition of discrimination against the states is a rule that remains absolute, a genuine "immunity." Congress may not "commandeer the legislative processes of the States by directly compelling them to enact and enforce a federal regulatory program." Hodel v. Virginia Surface Mining & Reclamation Ass'n, Inc., 452 U.S. 264, 288, 101 S.Ct. 2352, 69 L.Ed.2d 1 (1981). See also Printz v. United States, 521 U.S. 898, 117 S.Ct. 2365, 138 L.Ed.2d 914 (1997); New York v. United States, 505 U.S. 144, 112 S.Ct. 2408, 120 L.Ed.2d 120 (1992); FERC v. Mississippi, 456 U.S. 742, 762-66, 102 S.Ct. 2126, 72 L.Ed.2d 532 (1982). When Congress enacted legislation requiring states to pass laws regulating nuclear waste--and to pay the steep penalty of taking title to all waste within their borders if they failed to comply--the Court replied (in New York) that the national government simply may not direct the states to use their legislative powers to regulate private conduct. Printz adds that the same principle applies to the federal government's direction that a state's executive branch enforce federal rules. Although the Constitution's supremacy clause precludes any effort by states to divorce themselves from the application of federal law when they choose to act, see Printz, 521 U.S. at 913, 117 S.Ct. at 2374; FERC v. Mississippi, 456 U.S. at 759-69, 102 S.Ct. 2126; Howlett v. Rose, 496 U.S. 356, 110 S.Ct. 2430, 110 L.Ed.2d 332 (1990); Testa v. Katt, 330 U.S. 386, 67 S.Ct. 810, 91 L.Ed. 967 (1947); Claflin v. Houseman, 93 U.S. 130, 23 L.Ed. 833 (1876); Alleghany Corp. v. Haase, 896 F.2d 1046, 1053-56 (7th Cir.1990) (concurring opinion), vacated in part as moot, 499 U.S. 933, 111 S.Ct. 1383, 113 L.Ed.2d 441 (1991), Congress must assign the enforcement duty to federal officials unless the Constitution itself authorizes use of the states as agents (see Art. I § 4 cl. 1; Association of Community Organizations for Reform Now v. Edgar, 56 F.3d 791 (7th Cir.1995)). When the national government conscripts the legislative or executive arms...