California Trucking Association et al v. Becerra et al

REPLY to Response to Motion re MOTION to Dismiss Plaintiffs' First Amended Complaint

S.D. Cal.March 25, 2019

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM STACEY M. LEYTON (SBN 203827) Email: sleyton@altber.com ANDREW KUSHNER (SBN 316035) Email: akushner@altber.com ALTSHULER BERZON LLP 177 Post Street, Suite 300 San Francisco, CA 94108 Telephone: (415) 421-7151 Facsimile: (415) 362-8064 Attorneys for Intervenor-Defendant International Brotherhood of Teamsters UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA CALIFORNIA TRUCKING ASSOCIATION, RAVINDER SINGH, and THOMAS ODOM, Plaintiffs, v. XAVIER BECERRA, in his official capacity as the Attorney General of the State of California; ANDRE SCHOORL, in his official capacity as the Acting Director of the Department of Industrial Relations of the State of California; and JULIE A. SU, in her official capacity as Labor Commissioner of the State of California, Division of Labor Standards Enforcement, Defendants, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, Intervenor-Defendant. Case No. 3:18-cv-02458-BEN-BLM REPLY MEMORANDUM IN SUPPORT OF INTERVENOR- DEFENDANT’S MOTION TO DISMISS Hearing Date: April 2, 2019 Time: 10:30am Courtroom: 5A Judge: Honorable Roger T. Benitez Action Filed: October 25, 2018 Trial Date: Not set Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.376 Page 1 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM TABLE OF CONTENTS TABLE OF AUTHORITIES ........................................................................................ii I. INTRODUCTION ..............................................................................................1 II. ARGUMENT ......................................................................................................1 A. Plaintiffs Lack Standing for Their Pre-Enforcement Challenge ...............1 1. CTA Has Not Adequately Alleged Associational Standing ...................1 2. The Individual Plaintiffs Have Not Adequately Alleged Standing to Challenge Dynamex...................................................................................3 3. Plaintiffs Do Not Allege a Genuine Threat of Imminent Harm, as Required for a Pre-Enforcement Challenge to Dynamex ......................4 B. Plaintiffs’ Complaint Fails to State a Claim for Relief...............................5 1. Plaintiffs Fail to State an FAAAA Preemption Claim ............................5 a. Wage Order No. 9 Does Not Compel Use of Employees...............6 b. Plaintiffs’ Allegations about Effects on Prices, Routes, and Services Do Not State a Claim under Ninth Circuit Precedent ......8 2. Plaintiffs Fail to State a Dormant Commerce Clause Claim.................9 3. Plaintiffs Fail to State an FMCSA Preemption Claim.........................10 III. CONCLUSION ...................................................................................................10 Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.377 Page 2 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ii REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM TABLE OF AUTHORITES Federal Cases Alaska Airlines, Inc. v. City of Long Beach, 951 F.2d 977 (9th Cir. 1991) ........................................................................................9 Alvarez v. XPO Logistics Cartage, LLC, 2018 WL 6271965 (C.D. Cal. Nov. 15, 2018) ..............................................................7 American Trucking Associations, Inc v. City of Los Angeles, 559 F.3d 1046 (9th Cir. 2009) ......................................................................................5 Ashcroft v. Iqbal, 556 U.S. 662 (2009) .....................................................................................................7 Bedoya v. American Eagle Express, Inc., 914 F.3d 812 (3d Cir. 2019) .........................................................................................8 Big Lagoon Rancheria v. California, 789 F.3d 947 (9th Cir. 2015) ...................................................................................... 10 California Tow Truck Ass’n v. City and Cnty. of San Francisco, 693 F.3d 847 (9th Cir. 2012) ........................................................................................6 California Trucking Association v. Su, 903 F.3d 953 (9th Cir. 2018) ........................................................................................8 Californians for Safe & Competitive Dump Truck Transport v. Mendonca, 152 F.3d 1184 (9th Cir. 1998) ......................................................................................8 Dilts v. Penske Logistics, LLC, 769 F.3d 637 (9th Cir. 2014) .................................................................................... 6, 9 Eden Envtl. Citizen’s Group LLC v. Laptalo Enters., Inc., 2019 WL 1202056 (N.D. Cal. Mar. 14, 2019) ..............................................................3 In re Cell Tower Litigation, 2010 WL 3419516 (S.D. Cal. 2010) .............................................................................7 League of Women Voters of California v. Kelly, 2017 WL 3670786 (N.D. Cal. 2017).............................................................................3 Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) ................................................................................................. 3, 4 NAACP v. Ameriquest Mortgage Co., 635 F.Supp.2d 1096 (C.D. Cal. 2009)...........................................................................3 National Council of La Raza v. Cegavske, 800 F.3d 1032 (9th Cir. 2015) .................................................................................. 2, 3 Rosemere Neighborhood Ass’n v. U.S. E.P.A., 581 F.3d 1169 (9th Cir. 2009) .................................................................................... 10 Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.378 Page 3 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 iii REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM Schneider v. Cal. Dep’t of Corrections, 151 F.3d 1194 (9th Cir. 1998) ......................................................................................4 Schwann v. FedEx Ground Package System, Inc., 813 F.3d 429 (1st Cir. 2016)..................................................................................... 7, 8 Skaff v. Meridien North America Beverly Hills LLC, 506 F.3d 832 (9th Cir. 2007) ........................................................................................4 Sullivan v. Oracle Corp., 662 F.3d 1265 (9th Cir. 2011) ................................................................................ 9, 10 Summers v. Earth Island Inst., 555 U.S. 488 (2009) ............................................................................................. 1, 2, 3 Thomas v. Anchorage Equal Rights Com’n, 220 F.3d 1134 (9th Cir. 2000) .................................................................................. 4, 5 State Cases Chambers v. RDI Logistics, Inc., 65 N.E.3d 1 (Mass. 2016).............................................................................................8 Dynamex Operations West, Inc. v. Superior Court, 4 Cal.5th 903 (2018)............................................................................................ passim S.G. Borello & Sons, Inc. v. Department of Industrial Relations, 48 Cal.3d 341 (1989)....................................................................................................2 Federal Statutes 29 U.S.C. §213(a) ............................................................................................................7 49 U.S.C. §31141........................................................................................................... 10 Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.379 Page 4 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM I. INTRODUCTION International Brotherhood of Teamsters’ (“IBT”) Motion to Dismiss explained why Plaintiffs do not have standing and, even if they did, their claims would fail on the merits. See Dkt. 29-1 (“MTD”). Nothing in Plaintiffs’ opposition (Dkt. 34 (“Opp.”)) undermines IBT’s arguments. First, Plaintiffs have not adequately alleged standing to bring a pre- enforcement challenge to the construction of Industrial Welfare Commission Wage Order 9-2001, Cal. Code Regs., tit. 8, §11090 (“Wage Order 9”) in Dynamex Operations West, Inc. v. Superior Court, 4 Cal.5th 903 (2018). Contrary to Plaintiffs’ arguments, California Trucking Association (“CTA”) is not excused from identifying a member affected by Dynamex, and Plaintiffs must plead a theory of the individual plaintiffs’ standing that is not at odds with Wage Order 9 and an imminent threat of enforcement. They have done none of these things. Second, Plaintiffs ignore IBT’s main merits argument: because application of Dynamex’s test triggers only coverage by the Wage Order, Plaintiffs’ Federal Aviation Administration Authorization Act (“FAAAA”) preemption claim turns on whether the specific requirements of the Wage Order are preempted, and the Ninth Circuit has already concluded they are not. Rather than even acknowledge this argument, Plaintiffs misrepresent the Wage Order by insisting that it prevents motor carriers from hiring independent owner-operators altogether. Plaintiffs’ remaining claims—a dormant Commerce Clause claim and preemption claim based on the Federal Motor Carrier Safety Act (“FMCSA”)— also fail. Ninth Circuit precedent forecloses the former, and the latter is moot. II. ARGUMENT A. Plaintiffs Lack Standing for Their Pre-Enforcement Challenge 1. CTA Has Not Adequately Alleged Associational Standing An organization asserting associational standing must “identify members who have suffered the requisite harm.” Summers v. Earth Island Inst., 555 U.S. Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.380 Page 5 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM 488, 499 (2009). Plaintiffs’ First Amended Complaint (Dkt. 25 (“FAC”)) does not identify a single CTA member (let alone plead facts about harm to that member). Plaintiffs initially argue that National Council of La Raza v. Cegavske, 800 F.3d 1032 (9th Cir. 2015), excuses CTA from Summers’ requirement. Opp. at 12 & n.11. But Cegavske is inapplicable for two reasons. First, under Cegavske, an organization need not identify a specific member to establish associational standing only “[w]here it is relatively clear, rather than speculative, that one of more members” are injured. 800 F.3d at 1041. Here, it purely speculative that any CTA member will be injured if Dynamex rather than the standard from S.G. Borello & Sons, Inc. v. DIR, 48 Cal.3d 341 (1989), determines whether Wage Order 9 applies. Even before Dynamex, the Labor Commissioner found in 97% of drayage driver misclassification cases that the driver was misclassified under Borello. MTD at 5. Thus, many CTA members’ workers would qualify for Wage Order protections even under Borello, so Dynamex cannot injure these companies. Second, Cegavske applies only “where the defendant need not know the identity of a particular member to understand and respond to an organization’s claim of injury.” 800 F.3d at 1041. Here, Defendants do need to know the identity of particular members to respond to CTA’s claim to standing. If a given CTA member’s workers are already protected by the Wage Order under Borello, then Dynamex makes no difference and CTA cannot rely on that member to challenge Dynamex. Cegavske does not excuse CTA from identifying an affected member. CTA next argues that there is no need to identify an affected member at the pleading stage. Opp. at 12-13. But this argument is irreconcilable with Cegavske, which considered at the pleading stage whether an organization had sufficiently alleged associational standing. See 800 F.3d at 1041-42. Cegavske did not hold that there is no need to identify an affected member at the pleadings stage, but instead held that the organization in that case had fulfilled the identification requirement’s purposes by pleading facts establishing that it was “relatively clear” Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.381 Page 6 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM that one of its members was in fact affected. Id. at 1041. In fact, courts after Cegavske have applied Summers at the pleading stage. See, e.g., Eden Envtl. Citizen’s Group LLC v. Laptalo Enters., Inc., 2019 WL 1202056, at *4 (N.D. Cal. Mar. 14, 2019) (citing Summers and holding that plaintiff’s complaint “fails to establish Article III standing for plaintiff-organization Eden because it does not identify even one member of the organization nor make specific claims regarding past or future harm suffered by that individual”).1 2. The Individual Plaintiffs Have Not Adequately Alleged Standing to Challenge Dynamex Plaintiffs Singh and Odom also lack standing to challenge Dynamex. Their theory of standing is based on the faulty premise that Dynamex will force trucking companies to cease contracting with independent drivers like Singh and Odom because those drivers can no longer “lawfully contract as individual owner- operators.” See Opp. at 10 (quoting FAC ¶59). But Plaintiffs’ opposition does not even attempt to explain how Dynamex precludes a trucking company from hiring an individual owner-operator for a one-off job. In fact, as IBT has explained, Dynamex does no such thing. See infra at 6-7; see also MTD at 18-20. Rather, it merely requires that the companies comply with the requirements of the Wage Order in compensating those drivers, providing them with meal and rest breaks, and reimbursing them for wear and tear of their vehicles. Plaintiffs’ only response is that this Court must “presume” that their “general factual allegation[]” that Singh and Odom “‘face the threat of losing their businesses’” “‘embraces those specific facts that are necessary to support the claim.’” Opp. at 9-10 (quoting FAC ¶59 and Lujan v. Defenders of Wildlife, 504 1 The district court decisions cited in Plaintiffs’ opposition, Opp. at 12-13, do not establish that Summers is inapplicable at the pleading stage. In League of Women Voters of California v. Kelly, 2017 WL 3670786 (N.D. Cal. 2017), the court held only, consistent with Cegavske, that there was no need in that case for the plaintiff membership organization to identify an affected member. Id. at *8. And NAACP v. Ameriquest Mortgage Co., 635 F.Supp.2d 1096 (C.D. Cal. 2009) predates Summers and Cegavske, so it is no longer good law on this point. Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.382 Page 7 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM U.S. 555, 561 (1992)). Lujan’s language about allegations of injury embracing subsidiary factual allegations does not apply here, however, because Plaintiffs have revealed their theory of injury to be flawed. Plaintiffs’ theory—that Singh and Odom face losing their businesses because, under Dynamex, they can no longer “lawfully contract as individual owner-operators”—rests on a misunderstanding of the Wage Oder, which does not preclude a hiring entity from contracting with an individual owner-operator. Even at the motion to dismiss stage, no presumption entitles Plaintiffs to plead a theory of injury that is demonstrably inaccurate.2 3. Plaintiffs Do Not Allege a Genuine Threat of Imminent Harm, as Required for a Pre-Enforcement Challenge to Dynamex Even if Plaintiffs might at some point in the future have standing to challenge Dynamex, their pre-enforcement complaint would still be subject to dismissal for failure to allege a “genuine threat of imminent prosecution.” Thomas v. Anchorage Equal Rights Com’n, 220 F.3d 1134, 1139 (9th Cir. 2000) (en banc). Plaintiffs argue that they face such a threat because the State is charged with enforcing Wage Order 9 and workers can seek to enforce the Wage Orders through the Private Attorneys General Act (“PAGA”). Opp. at 5-8. These assertions are irrelevant and, in any case, do not establish an imminent prosecution threat. First, Plaintiffs’ new assertions about the risk of prosecution are irrelevant because they are not in the FAC. See Schneider v. Cal. Dep’t of Corrections, 151 F.3d 1194, 1197 n.1 (9th Cir. 1998) (in ruling on motion to dismiss, “‘[t]he court may not . . . take into account additional facts asserted in a memorandum opposing the motion to dismiss, because such memoranda do not constitute pleadings under Rule 7(a)’”) (quoting 2 Moore’s Federal Practice, §12.34 (3d. ed.)). 2 Plaintiffs also cite Skaff v. Meridien North America Beverly Hills LLC, 506 F.3d 832 (9th Cir. 2007), but that case supports IBT’s position. There, the plaintiff had standing because his complaint identified specific “barriers to disabled access” that he had personally encountered at the defendant hotel. Id. at 841. Plaintiffs’ complaint lacks such specific allegations, and instead contains only the conclusory (and inaccurate) allegation that Singh and Odom face losing their business because Dynamex precludes trucking companies from hiring them as owner-operators. Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.383 Page 8 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM Second, in any event, these allegations would not establish imminent harm. Plaintiffs’ allegation that CTA’s motor carrier members “‘risk criminal and civil liability for violation of Wage Order No. 9,’” Opp. at 14 (quoting FAC ¶46), establishes only “the mere existence of a proscriptive statute” and “generalized threat of prosecution,” which are insufficient to demonstrate standing for pre- enforcement relief. See Thomas, 220 F.3d at 1139. Moreover, even if they could allege that the state were actively enforcing Dynamex, that would not establish that any CTA member faces liability under Dynamex, let alone imminent liability, as required. Plaintiffs in fact concede that “Defendants are not threatening an immediate enforcement action under Dynamex.” See FAC ¶48 (emphasis added).3 American Trucking Associations, Inc v. City of Los Angeles, 559 F.3d 1046 (9th Cir. 2009) (“ATA”), provides no help to Plaintiffs. See Opp. at 14-16. ATA does not discuss standing requirements for a pre-enforcement challenge (or even standing at all) but instead addresses the irreparable harm prong of the preliminary injunction standard. Id. at 1057. The ATA plaintiff demonstrated irreparable harm because inevitable consequences resulted from any refusal to follow the law: trucking companies were “barred from entering [the] Port” unless they agreed to abide by the challenged regulation. Id. at 1051. Here, by contrast, Plaintiffs’ allegations establish only that any trucking company that does not comply with the Wage Order faces an uncertain, “generalized threat of prosecution,” which does not entitle Plaintiffs to declaratory relief. See Thomas, 220 F.3d at 1139. B. Plaintiffs’ Complaint Fails to State A Claim for Relief 1. Plaintiffs Fail to State an FAAAA Preemption Claim Plaintiffs completely ignore the central argument in IBT’s motion: because the Dynamex test itself imposes no legal obligations, Plaintiffs’ FAAAA preemption claim turns on whether the substantive requirements of Wage Order 9 3 Plaintiffs do not respond to IBT’s arguments that Plaintiffs’ allegations that they will need to spend money to comply with Wage Order 9, that some motor carriers may cease operating in California, and that there is alleged uncertainty about the legal status of Dynamex do not establish standing. See MTD at 8-9. Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.384 Page 9 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 6 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM that attach through the Dynamex test are preempted. See MTD at 10-12. Rather than discuss the actual requirements of the Wage Order (or even attempt to explain why the analysis should not focus on those requirements), Plaintiffs’ opposition repeats the erroneous contention that the Wage Order “impermissibly compels the use of employees rather than owner-operators.” Opp. at 23. The Wage Order does no such thing, and Plaintiffs’ FAAAA preemption claim fails. a. Wage Order No. 9 Does Not Compel Use of Employees IBT’s motion to dismiss explained that, under Ninth Circuit precedent, “when preemption is claimed, a court must pay careful attention to the particular provisions that a state or local entity seeks to impose upon motor carriers.” MTD at 11 (quoting California Tow Truck Ass’n v. City and Cnty. of San Francisco, 693 F.3d 847, 861 (9th Cir. 2012) (emphasis added)). Plaintiffs’ opposition does not even cite California Tow Truck Association, let alone respond to IBT’s argument that it requires this Court to evaluate Plaintiffs’ FAAAA preemption claim by considering the effect of each of the Wage Order’s substantive requirements on motor carriers. Nor do Plaintiffs even acknowledge IBT’s argument that the Ninth Circuit has already determined that each of the Wage Order’s substantive requirements are not preempted by the FAAAA because they bear only a “indirect, remote, and tenuous” relationship to motor carriers’ prices, routes, or services. See MTD at 12-16.4 4 Plaintiffs suggest that this authority is inapplicable because Wage Order 9 is not a “generally applicable” state law. Opp. at 22. However, Ninth Circuit precedent forecloses this argument. In Dilts v. Penske Logistics, LLC, 769 F.3d 637 (9th Cir. 2014), the defendant challenged the meal and rest break requirements of Wage Order 9 (Cal. Code Regs., tit. 8, §11090), among other California labor laws. Id. at 640-42. In rejecting that challenge, the Ninth Circuit held that the challenged laws were not preempted by the FAAAA because they are all “generally applicable background regulations.” Id. at 646. Furthermore, Plaintiffs do not challenge Wage Order 9 itself but Dynamex’s construction of the Wage Order’s definition of the term “employ,” which appears in all of the Wage Orders. See 4 Cal.5th at 926 & n.9; FAC ¶¶ 1-2. In fact, the 17 Wage Orders are nearly identical, and any differences between them are irrelevant to Plaintiffs’ claims. That the state released 17 different Wage Orders rather than a single order containing exceptions and different rules for certain industries (as Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.385 Page 10 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM Instead of discussing the actual requirements of the Wage Order or engaging with the relevant FAAAA jurisprudence, Plaintiffs attack a straw man by arguing that Dynamex “compels the use of employees” and “prohibit[s] . . . using owner- operators.” Opp. at 23-24. It does not. As IBT has explained, Dynamex requires only that, if the owner-operator on a particular job meets the Dynamex test, the hiring entity pay the owner-operator in accordance with the Wage Order’s minimum wage rules, provide the owner-operator with meal and rest breaks, and reimburse the owner-operator for costs incurred in operating his or her truck during the job (and follow other rules that have an even more remote connection to prices, routes, and services). MTD at 18-20. Dynamex does not require a motor carrier to use only employees or invest in its own fleet of trucks (see FAC ¶58), so a motor carrier can still abide by the Wage Order if it contracts with individual owner- operators and pays them as independent contractors for federal tax purposes.5 Because Dynamex does not prohibit motor carriers from using owner- operators, Plaintiffs’ discussion of cases addressing “all-or-nothing” prohibitions on independent contractors is irrelevant. See Opp. at 26-27. The regulation at issue in ATA explicitly “mandate[d] the phasing out . . . of independent contractors,” thereby binding motor carriers to use certain types of workers. 559 F.3d at 1053-55. Dynamex does not preclude motor carriers from hiring independent contractors for individual jobs, so ATA is inapposite. Plaintiffs’ other cases are also inapplicable. IBT has explained that Alvarez v. XPO Logistics Cartage, LLC, 2018 WL 6271965 (C.D. Cal. Nov. 15, 2018), and Schwann v. FedEx Ground Package System, Inc., 813 F.3d 429 (1st Cir. 2016), are under the Fair Labor Standards Act, for example (see 29 U.S.C. §213(a))) does not determine whether the underlying rules are generally applicable. 5 Plaintiffs argue that this Court must accept as true the contrary allegations in Plaintiffs’ FAC. Opp. at 23 (citing In re Cell Tower Litig., 2010 WL 3419516 (S.D. Cal. 2010)). But as this Court recognized in In re Cell Tower Litigation, a court “is not required ‘to accept as true a legal conclusion couched as a factual allegation.’” 2010 WL 3419516, at *2 (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). Plaintiffs’ allegations about the effect of Dynamex and the Wage Order are just that, and so should not be credited for purposes of this motion. Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.386 Page 11 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 8 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM inconsistent with Ninth Circuit precedent, and that California Trucking Association v. Su, 903 F.3d 953 (9th Cir. 2018), expressly declined to address Dynamex. See MTD at 11, 16-18 & n.10. And Bedoya v. American Eagle Express, Inc., 914 F.3d 812 (3d Cir. 2019), merely summarizes Schwann’s holding as part of its survey of relevant case law. Bedoya, 914 F.3d at 822. Finally, Chambers v. RDI Logistics, Inc., 65 N.E.3d 1 (Mass. 2016), like Schwann, is incompatible with Ninth Circuit law. Chambers’ holding that Massachusetts’ version of the ABC Test had a significant impact on motor carriers’ services because it would “‘requir[e] that employers pay employees minimum wage,’” id. at 9 (quoting Mass. Gen. Laws ch. 151, §1), is plainly at odds with Californians for Safe & Competitive Dump Truck Transport v. Mendonca, 152 F.3d 1184 (9th Cir. 1998), which held that minimum wage requirements are not preempted because they have only an “indirect, remote, and tenuous” effect on prices, routes, or services. Id. at 1189. b. Plaintiffs’ Allegations about Effects on Prices, Routes, and Services Do Not State a Claim under Ninth Circuit Precedent Plaintiffs also rely on allegations that Dynamex will have a “significant” impact on prices, routes, and services. Opp. at 27-29. Even if true, however, Plaintiffs’ allegations would establish only the sort of “indirect, remote, and tenuous” effect that the Ninth Circuit has held does not cause FAAAA preemption. i. Prices. Plaintiffs allege that Dynamex “will materially affect motor carriers’ costs.” Opp. at 28 (quoting FAC ¶45). But in Mendonca, the Ninth Circuit held that the Prevailing Wage Law would not be preempted even if it increased prices by 25%. 152 F.3d at 1189. Under Mendonca, Plaintiffs’ allegation that prices will rise “a few percent” as a result of Dynamex (FAC ¶45) is insufficient to state a claim. ii. Routes. Plaintiffs allege that Dynamex “directly impacts the routes that a motor carrier must use” because “routes must be reconfigured by the motor carriers to ensure drivers are able to . . . take the meal and rest periods mandated under” Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.387 Page 12 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 9 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM Wage Order 9. Opp. at 28-29 (quoting FAC ¶44). However, Dilts squarely held that any such effect on motor carriers is insufficient to establish preemption. 769 F.3d at 649 (“The requirement that a driver briefly pull on and off the road during the course of travel does not meaningfully interfere with a motor carrier’s ability to select its starting points, destinations, and routes.”). iii. Services. Finally, Plaintiffs allege that services will be affected because motor carriers cannot “acquire every possible type of truck, trailer, and equipment” that could be needed. Opp. at 29 (quoting FAC ¶58). But this allegation plainly misrepresents the Wage Order. As previously explained, Dynamex does not require a motor carrier to purchase its own trucks. See supra at 7. A motor carrier can still hire an owner-operator with a specific piece of equipment for a job. 2. Plaintiffs Fail to State a Dormant Commerce Clause Claim Under Ninth Circuit precedent, laws that do not discriminate against interstate commerce run afoul of the dormant Commerce Clause only if “the burdens of the statute . . . so outweigh the putative benefits as to make the statute unreasonable or irrational.” Alaska Airlines, Inc. v. City of Long Beach, 951 F.2d 977, 983 (9th Cir. 1991) (emphasis added). Given this very difficult standard, it is unsurprising that the Ninth Circuit has held that “[t]here is no plausible Dormant Commerce Clause argument” against California’s Labor Code requirements, which apply “equally to work performed in California, whether that work is performed by California residents or by out-of-state residents.” Sullivan v. Oracle Corp., 662 F.3d 1265, 1271 (9th Cir. 2011) (emphasis added). Plaintiffs’ opposition succeeds only in demonstrating their disagreement with these Ninth Circuit decisions. Plaintiffs argue that Alaska Airlines’ “unreasonable or irrational” language “finds no support” in U.S. Supreme Court or Ninth Circuit case law. Opp. at 32- 33. Even if that were true (which it is not), it would be irrelevant, because this Court is bound by Alaska Airlines. Plaintiffs also argue that Sullivan is inapposite because it was decided at summary judgment. Opp. at 31. Not so. The Sullivan Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.388 Page 13 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM district court had granted summary judgment to the defendant on the plaintiff’s Labor Code claims. 662 F.3d at 1269. On appeal, the Ninth Circuit certified questions about the meaning of the Labor Code to the California Supreme Court, which overruled the district court’s interpretation. Id. at 1269-70. After the case returned to the Ninth Circuit, the defendant argued for the first time that the California Supreme Court’s construction of the Labor Code violated the dormant Commerce Clause. Id. at 1271. Even without any factual development, the Ninth Circuit summarily rejected the defendant’s dormant Commerce Clause argument in a mere three sentences. Id. Sullivan thus applies with full force even absent factual development regarding the impact of California’s labor laws. 3. Plaintiffs Fail to State an FMCSA Preemption Claim Plaintiffs’ cause of action under the FMCSA must be dismissed because there is no private right of action to enforce 49 U.S.C. §31141, the statute on which Plaintiffs rely. See MTD at 23-25. Plaintiffs’ opposition does not dispute that private litigants “cannot sue directly under” §31141 but instead argues that they are entitled to an order enforcing the FMCSA decision addressing California’s meal and rest break laws. Opp. at 34. However, as IBT has already explained, this Court cannot grant Plaintiffs that relief. Plaintiffs contend that the FMCSA’s decision is “binding unless and until it is reversed on appeal.” Id. Under that theory, their FMCSA claim is moot, because any order “enforcing” the FMCSA decision would offer no relief beyond the decision itself. See Big Lagoon Rancheria v. California, 789 F.3d 947, 956 (9th Cir. 2015) (claim is moot if it offers litigant “no further relief”); see also Rosemere Neighborhood Ass’n v. U.S. E.P.A., 581 F.3d 1169, 1173 (9th Cir. 2009) (“In general, when an administrative agency has performed the action sought by a plaintiff in litigation, a federal court ‘lacks the ability to grant effective relief,’ and the claim is moot.”). III. CONCLUSION For the reasons stated, Plaintiffs’ FAC should be dismissed. Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.389 Page 14 of 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11 REPLY ISO MOTION TO DISMISS; Case No. 3:18-cv-02458-BEN-BLM Dated: March 25, 2019 Respectfully submitted, STACEY M. LEYTON ANDREW KUSHNER Altshuler Berzon LLP By: /s/ Stacey M. Leyton f Stacey M. Leyton Attorneys for Intervenor-Defendant International Brotherhood of Teamsters Case 3:18-cv-02458-BEN-BLM Document 37 Filed 03/25/19 PageID.390 Page 15 of 15