Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-15614/USCOURTS-ca9-13-15614-1/pdf.json

Nature of Suit Code: 950
Nature of Suit: Constitutionality of State Statutes
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CALIFORNIA TOW TRUCK

ASSOCIATION,

Plaintiff-Appellant,

v.

CITY AND COUNTY OF SAN

FRANCISCO,

Defendant-Appellee.

No. 13-15614

D.C. No.

3:10-cv-03184-

CRB

ORDER AND

AMENDED

OPINION

Appeal from the United States District Court

for the Northern District of California

Charles R. Breyer, Senior District Judge, Presiding

Argued and Submitted

February 11, 2015—San Francisco California

Filed August 13, 2015

Amended December 8, 2015

Before: Michael Daly Hawkins, Richard A. Paez,

and Marsha S. Berzon, Circuit Judges.

Order;

Opinion by Judge Berzon

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2 CTTA V. CITY & CTY. OF SAN FRANCISCO

SUMMARY*

Federal Aviation Administration Authorization Act /

Preemption

The panel filed (1) an order denying petitions for panel

rehearing and rehearing en banc and (2) an amended opinion

affirming in part and reversing in part the district court’s

summary judgment in an action challenging San Francisco

ordinances that comprehensivelyregulate the towing industry

within the city and provide a number of conditions and

requirements concerning towing permits.

Tow car firms are “motor carriers” under the Federal

Aviation Administration Authorization Act, and the San

Francisco ordinances, known as the “Permit Scheme,”

generally relate to a price, route, or service of a motor carrier. 

The panel held, therefore, that Permit Scheme provisions

were preempted by the FAAAA unless they fell within the

FAAAA’s savings clauses, which included a “safety

exception.”

Agreeing with the Second Circuit, the panel held that the

safety exception covered regulations related both to the safe

physical operation of the tow trucks themselves and to the

safety of other vehicles and individuals involved in the

towing process. The panel held that Permit Scheme’s permit

requirements fell within the safety exception, as did multiple

other Permit Scheme provisions, including permit application

requirements, permit fee and penalty provisions, and

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 3

recordkeeping and brochure requirements. The panel also

held that possession and display requirements were not

subject to preemption. Finally, the panel held that the Permit

Scheme’s complaint system requirement fell within the safety

exception, but its business plan requirement did not and

therefore was preempted. The panel remanded the case to the

district court for further proceedings.

COUNSEL

Patrick J. Whalen, The Law Offices of Brooks Ellison,

Sacramento, California, for Plaintiff-Appellant.

Wayne Snodgrass (argued), Deputy City Attorney; Dennis J.

Herrera, City Attorney; Vince Chhabria, Deputy City

Attorney, San Francisco, California, for Defendant-Appellee.

ORDER

The panel has voted to deny appellant’s petition for panel

rehearing and petition for rehearing en banc. The full court

has been advised of the petition for rehearing en banc, and no

judge has requested a vote on whether to rehear the matter en

banc. Fed. R. App. P. 35.

The panel has voted to amend the opinion. The amended

opinion is attached hereto.

The petition for panel rehearing and petition for rehearing

en banc are denied. No further petitions for rehearing will be

permitted.

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4 CTTA V. CITY & CTY. OF SAN FRANCISCO

OPINION

BERZON, Circuit Judge:

The City and County of San Francisco requires tow truck

drivers and towing firms to obtain permits to operate and

conduct business within San Francisco. The City enacted two

ordinances, Articles 30 and 30.1 of the San Francisco Police

Code (the “Permit Scheme”), which comprehensively

regulate the towing industry within the city and provide a

number of conditions and requirements concerning the

towing permits.

The California Tow Truck Association (“CTTA”)

challenged the Permit Scheme, contending that it is

preempted by the Federal Aviation Administration

Authorization Act of 1994, 49 U.S.C. § 14501 (“FAAAA” or

the “Act”). After the district court initially granted partial

summary judgment, the parties appealed to this court. See

Cal. Tow Truck Ass’n v. City & Cnty. of S.F., 693 F.3d 847

(9th Cir. 2012) (“CTTA I”). We held that the district court

did not analyze the Permit Scheme as required by our

precedent, and so vacated the judgment and remanded for the

required provision-by-provision analysis. See id. at 866.

Following remand, the district court upheld nearly all of

the Permit Scheme, holding some provisions outside the

ambit of the Act’s express preemption clause, 49 U.S.C.

§ 14501(c)(1), and others covered by the Act’s savings

clauses, id. § 14501(c)(2)(A)–(C). In particular, the district

court determined that many of the provisions fell within the

FAAAA’s “safety exception,” id. § 14501(c)(2)(A), because

they are “genuinely responsive to safety concerns.” City of

Columbus v. Ours Garage & Wrecker Serv., Inc., 536 U.S.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 5

424, 442 (2002). The district court thus granted the City’s

cross-motion for summary judgment, from which CTTA

appeals. With the exception of the challenge to the Permit

Scheme’s business plan requirement, we affirm.

I.

A.

Pursuant to its authority under California law, see Cal.

Veh. Code § 21100(g)(1), the City enacted the Permit

Scheme. Article 30 of the Permit Scheme regulates “tow car

drivers,” S.F. Police Code § 3000 et. seq., and Article 30.1

regulates “tow car firms,” id. § 3050 et seq.1“Together,

Articles 30 and 30.1 set forth a comprehensive regulatory

regime requiring tow truck drivers and towing firms to obtain

permits to operate and conduct business in San Francisco.” 

CTTA I, 693 F.3d at 851.

Article 30 provides that “[n]o person shall drive or

operate a tow car within the City . . . without first obtaining

a permit from the Chief of Police . . . .” S.F. Police Code

§ 3000. To obtain a permit, tow car drivers must submit

1 The Permit Scheme adopts the California Vehicle Code’s definition of

tow car: “[A] motor vehicle which has been altered or designed and

equipped for, and primarily used in the business of, transporting vehicles

by means of a crane, hoist, tow bar, tow line, or dolly or is otherwise

primarily used to render assistance to other vehicles.” Cal. Veh. Code

§ 615(a); see S.F. Police Code § 3001.

A “tow car firm” is defined as “[a]ny person, firm, partnership,

association, corporation, or any other group . . . engaged in the business

of transporting, removing, or storage of motor vehicles, including the

owner/operator of any tow car as herein defined.” Id. § 3051.

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6 CTTA V. CITY & CTY. OF SAN FRANCISCO

identifying information, and disclose any criminal arrest

history. See id. § 3002. Along with the application,

applicants must submit fingerprints, passport-size

photographs, a letter from an employer, and a filing fee. Id.

§ 3003. After receiving an application for a permit, “[t]he

Chief of Police shall . . . make an investigation without

unnecessary delay . . . and grant such application,” unless the

applicant was convicted of violating, or acted in violation of,

certain enumerated criminal statutes, or falsified information

on the application. Id. § 3004.

The tow car driver must keep the permit, which contains

the names and residences of the driver and employer and

other identifying information, in “his immediate possession

at all times while driving or operating a tow car and shall

exhibit such permit on demand of any peace officer.” Id.

§§ 3006, 3007. The permits last for one year, are renewable

upon payment of the annual license fee, id. § 3008, and can

be revoked after a hearing if the Chief of Police “finds that

grounds exist which would have constituted just cause for

refusal to issue such permit,” id. § 3011. Driving or operating

a tow car within the City without a permit, or not maintaining

possession of a permit while driving or operating a tow car,

is a misdemeanor. Id. § 3012.

The Permit Scheme’s requirements for tow car firms are

similar to those for tow car drivers. As with tow car drivers,

“[n]o person shall engage in or conduct business as a tow car

firm within the City . . . without first obtaining a permit from

the Chief of Police . . . .” Id. § 3050. Applicants for such

permits must provide not only identifying information about

themselves and their business, id. § 3052(1)–(2), but also

additional information, including: details of “every tow car

that will be operated by the tow car firm,” id. § 3052(3); “[a]

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CTTA V. CITY & CTY. OF SAN FRANCISCO 7

description of the applicant’s business plan, and proposed

services to be provided, including . . . a system for handling

complaints that is acceptable to the Chief of Police,” id.

§ 3052(4); the name and permit number of all tow car

operators employed by the firm, id. § 3052(5); evidence of a

minimum level of insurance, id. § 3052(6); and a “record of

all crimes of which the applicant has been convicted,

plead[ed] guilty, or plead[ed] no contest,” id. § 3052(7). Like

tow car driver applicants, tow car firm applicants must submit

fingerprints, photographs, and a filing fee. Id. § 3053.

A tow car firm permit shall be granted unless the Police

Department finds that the applicant, among other things, does

not possess a minimum level of insurance, does not possess

requisite tow car equipment, or has been convicted of certain

crimes. Id. § 3054. Every firm issued a permit must display

the permit “in a conspicuous place within the tow car firm

business address, so that the [permit] may be readily seen by

persons entering the premises.” Id. § 3055. The Police

Department may suspend or revoke a tow car firm permit for

any of the grounds listed in § 3054, as well as for additional

reasons, including failing to maintain required levels of

insurance and employing a tow car operator who lacks a valid

operating permit. Id. § 3056.

Like the individual tow car driver permits, a tow car firm

permit lasts for a year and is renewable upon payment of an

annual license fee. Id. § 3062. Article 30.1, however,

contains some additional requirements for tow car firm

permit-holders. For example, tow car firms are required

regularly to submit proof of insurance and evidence of

registration, and must notify the Police Department of the

number of tow vehicles or changes in tow car drivers’

employment status. Id. § 3058. Additionally, “[t]ow car firm

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8 CTTA V. CITY & CTY. OF SAN FRANCISCO

vehicles may be inspected for code and safety violations by

any peace officer.” Id. § 3059. Tow car firms are also

required to maintain records of each vehicle towed for three

years and to make such records available for inspection by

any peace officer. Id. § 3060. Conducting business without

a tow car firm permit or failing to display the permit at the

tow car firm business is a misdemeanor. Id. § 3064.

The San Francisco Board of Supervisors amended Article

30.1 in 2009 to include a brochure requirement. See id.

§ 3055.2(c). When a vehicle has been towed, tow car firms

must “provide information to towed-vehicle owners by

displaying and making available a brochure ‘in a conspicuous

place in the location where a vehicle owner must come to

reclaim their towed vehicle.’” CTTA I, 693 F.3d at 854

(quoting S.F. Police Code § 3055.2(c)). The brochure,

developed by the City’s police department, consists of “a

concise summary of California law, including the maximum

rate that can be legally charged for a private property tow and

the rights and responsibilities of all parties who participate in

towing from private property . . . .” S.F. Police Code

§ 3055.2(b). Non-compliance with this requirement triggers

an administrative penalty of $500. Id. § 3055.2(f).

When it promulgated the brochure requirement in 2009,

the Board of Supervisors made a number of legislative

findings, including:

(i) that there are frequent incidents of illegal

towing from private property in San

Francisco; and

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CTTA V. CITY & CTY. OF SAN FRANCISCO 9

(ii) that there is a significant risk to the safety

of residents and visitors when illegal towing

from private property occurs at night; and

(iii) that there is a risk to public health and

safetywhen the vehicles of senior citizens and

persons with disabilities are illegally towed

from private property; and

(iv) that illegal towing from private property

affects vulnerable populations when people of

limited economic means are required to pay

hundreds of dollars to recover their vehicle, or

are subjected to deficiency claims by

collection agencies if they could not afford to

pick up their vehicle even though the vehicle

was illegally towed; and . . .

(ix) that consistent adherence to legal towing

practices will substantially increase the

quality of life for residents and the experience

of visitors to San Francisco.

S.F. Police Code § 3055.2(a). Both Articles 30 and 30.1

include severability clauses, providing that if any part is “held

to be unconstitutional or invalid,” such a decision “shall not

affect the validity or effectiveness of the remaining portions.” 

Id. §§ 3013, 3065.

B.

In July 2010, CTTA, a nonprofit organization

representing more than 1,000 towing companies doing

business in California, filed a complaint against the City in

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10 CTTA V. CITY & CTY. OF SAN FRANCISCO

San Francisco Superior Court. According to CTTA, its

members had been “harassed and subject to citations, fines,

and in some cases the impound of their tow truck . . . for

failing to obtain a permit.” Moreover, it alleged, “[t]he

ability of CTTA members to conduct their business is

adversely affected by the San Francisco ordinance, because

it subjects them to great uncertainty as to whether they are

able to conduct business in, around, and through the City.” 

Several owners and operators of tow car firms also declared

that the Permit Scheme has impacted their routes and

services, and caused them to incur significant costs.

In its action, CTTA sought, among other things, a

declaration that the Permit Scheme is preempted by federal

law and an injunction prohibiting the City from enforcing its

provisions. After the City removed the case to federal court,

the parties filed cross-motions for summary judgment. As

relevant here, CTTA argued that the Permit Scheme is

preempted by the FAAAA’s express preemption clause,

which provides: “[A] State . . . 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.” 49 U.S.C.

§ 14501(c)(1).

Conceding that the Permit Scheme “relate[s] to” the

“price” and “service” of a towing company, and hence of a

“motor carrier,” the City argued that the Permit Scheme is not

preempted because it falls within the Act’s savings clauses —

in particular, the Act’s “safety exception.” The safety

exception provides that the Act’s express preemption clause

“shall not restrict the safety regulatory authority of a State

with respect to motor vehicles.” 49 U.S.C. § 14501(c)(2)(A). 

The City emphasized that the regulations were motivated by

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CTTA V. CITY & CTY. OF SAN FRANCISCO 11

safety concerns, pointing in particular to a declaration by

Sergeant William Coggan, the Commanding Officer of the

San Francisco Police Department’s Permit Section. Coggan

explained that “corruption and criminal activity pervade the

[towing] industry,” leading to “[i]mproper conduct” such as

“towing vehicles illegally; overcharging people whose

vehicles are towed; outright stealing towed vehicles;

operating tow trucks in an unsafe manner on the road;

stealing merchandise from towed vehicles; and causing

damages to towed vehicles.” Further, Coggan stated that he

was “aware of instances in which tow operators or their

employees have physically or sexually assaulted persons

whose cars had been towed.” “[T]he towing business,”

Coggan declared, “by its nature, presents certain dangers to

the public,” as “when a person discovers that her car has been

towed, she is sometimes left stranded in a dangerous

location.”

The district court initially held that the Permit Scheme

was preempted to the extent it applied to companies and

drivers that engage solely in “consensual” tows, as well as to

those merely “passing through” San Francisco. CTTA I,

693 F.3d at 856–57.2 But it also held that the Permit Scheme

was not preempted as applied to companies and drivers that

engage in “nonconsensual tows” in the City. Id. The district

2 Consensual towing involves “an agreement between the car owner and

the tow truck driver,” while “[n]on-consensual towing involves towing,

often from private lots, improperly or ‘illegally’ parked cars.” CTTA I,

693 F.3d at 857. “In non-consensual tows the car owner typically does not

know that his car has been towed until he comes to retrieve it and it is not

there.” Id.

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12 CTTA V. CITY & CTY. OF SAN FRANCISCO

court entered judgment for the City on CTTA’s other federal

claims, and remanded CTTA’s state claims to state court.3

Both parties appealed on the FAAAA preemption

question. We concluded that the district court erred in

analyzing the Permit Scheme “without specificallyaddressing

its individual provisions,” rather than “on a provisionby-provision basis.” CTTA I, 693 F.3d at 850, 860. The

district court, we noted, need not “analyze every sentence of

the Permit Scheme, line by line.” Id. at 863. But “where a

multi-faceted law or regulation is challenged as a whole,” we

explained, “it is still necessary to analyze each of its essential

or major component parts.” Id. at 860. Although the district

court applied the correct test in determining whether the

Permit Scheme was preempted, id. at 861–62, it did not

“analyze the major provisions identified . . . and address

whether the Permit System can survive, after severing

provisions, if any, that are pre-empted,” id. at 863. We thus

vacated and remanded to the district court to conduct the

FAAAA preemption analysis “in the first instance.” Id.4

3 After the San Francisco Superior Court granted judgment for the City

on its state preemption claims, CTTA appealed. The Court of Appeal

reversed, noting that, under California law, a local authority may “only

license and regulate tow truck services and drivers having their ‘principal

place of business or employment’ within the jurisdiction of the local

authority.” Cal. Tow Truck Ass’n v. City & Cnty. of S.F., 225 Cal. App.

4th 846, 858 (2014). It thus held the City’s regulation of towing services

and drivers whose “principal place of business or employment is located

in another jurisdiction” preempted by state law. Id.

4 CTTA I also held that, as the “undisputed evidence” established that the

City does not require tow truck drivers and tow firms to obtain a permit

just to pass through, CTTA could not show “a realistic danger of

enforcement,” and thuslacked standing. 693 F.3d at 865–66. As a result,

the district court lacked jurisdiction to enjoin the City from enforcing the

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CTTA V. CITY & CTY. OF SAN FRANCISCO 13

After remand, the parties again filed cross-motions for

summary judgment. The district court then granted summary

judgment to the City as to all but one of the challenged

provisions of the Permit Scheme, holding that a majority of

the Permit Scheme’s provisions were exempted from

preemption by the Act’s safety, insurance, and price

exceptions.5

In so holding, it rejected CTTA’s “narrow”

definition of “motor vehicle safety,” noting that “the Ninth

Circuit has endorsed a concept of motor vehicle safety that

encompasses but surely goes well beyond the safe

performance of towing services.” The district court also

determined that several challenged provisions — the permit

display requirement (sections 3007 and 3055) and the

business plan requirement (section 3052(4)) — were not

subject to the FAAAA’s express preemption clause at all. 

CTTA appeals from that judgment.

II.

A.

“The principal purpose of the FAAAA was ‘to prevent

States from undermining federal deregulation of interstate

trucking’ through a ‘patchwork’ of state regulations.” Dilts

v. Penske Logistics, LLC, 769 F.3d 637, 644 (9th Cir. 2014)

(quoting Am. Trucking Ass’ns v. City of L.A., 660 F.3d 384,

Permit Scheme against “tow trucks merely passing through San

Francisco.” Id.

5 The district court concluded that section 3056(2), which authorizes the

Chief of Police to revoke the permit of any tow firm that imposes charges

“in excess of the maximum rate established by the [City] for its contracted

tow car firms,” was preempted. The City does not appeal this holding.

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14 CTTA V. CITY & CTY. OF SAN FRANCISCO

395–96 (9th Cir. 2011), rev’d in part, 133 S.Ct. 2096 (2013)). 

Toward that end, the FAAAA contains an express preemption

clause, which provides:

Except as provided in [the savings clauses in]

paragraphs (2) and (3), a State [or] political

subdivision of a State . . . 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

. . . .

49 U.S.C. § 14501(c)(1). The parties agree that tow car firms

are “motor carriers” under the statute, and that the Permit

Scheme generally “relate[s] to a price, route, or service” of a

motor carrier. See CTTA I, 693 F.3d at 857. Accordingly, at

least some of the Permit Scheme’s provisions are preempted

unless they fall within the FAAAA’s savings clauses, 49

U.S.C. § 14501(c)(2)–(3).

Three of those clauses are at issue here. See CTTA I,

693 F.3d at 857–58. The “safety exception” provides that the

FAAAA “shall not restrict the safety regulatory authority of

a State with respect to motor vehicles.” 49 U.S.C.

§ 14501(c)(2)(A). The “insurance exception” saves from

preemption state laws “relating to insurance requirements and

self-insurance authorization.” Id. Finally, the “price

exception” permits “a State or a political subdivision of a

State to enact or enforce a law . . . relating to the price of

for-hire motor vehicle transportation by a tow truck, if such

transportation is performed without the prior consent or

authorization of the owner or operator of the motor vehicle”

— i.e., is a nonconsensual tow. Id. § 14501(c)(2)(C). As the

district court observed, “[t]he motor vehicle safety exception

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CTTA V. CITY & CTY. OF SAN FRANCISCO 15

is the main, though not exclusive, focus of the parties’

dispute.”

Importantly, “[p]reemption analysis ‘start[s] with the

assumption that the historic police powers of the States were

not to be superseded by the Federal Act unless that was the

clear and manifest purpose of Congress.’” Ours Garage,

536 U.S. at 438 (second alteration in original) (quoting

Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996)). 

Furthermore, the Act “does not pre-empt state laws that affect

rates, routes, or services in too tenuous, remote, or peripheral

a manner.” Rowe v. N.H. Motor Transp. Ass’n, 552 U.S. 364,

375 (2008) (internal quotation marks omitted).

B.

Ours Garage held that the FAAAA’s safetyexception can

apply to ordinances enacted by municipalities, even though

§ 14501(c)(2)(A) refers only to “the safety regulatory

authority of a State.” 536 U.S. at 428. That is so, Ours

Garage explained, because “Congress’ clear purpose in

§ 14501(c)(2)(A) is to ensure that its preemption of States’

economic authority over motor carriers of property . . . ‘not

restrict’ the preexisting and traditional state police power

over safety[,] . . . includ[ing] the choice to delegate the

State’s ‘safety regulatory authority’ to localities.” Id. at 439. 

“At the same time, however, Ours Garage also warned that

states and municipalities could not hide economic regulation

under the guise of safety regulation.” CTTA I, 693 F.3d at

858 (internal citation and quotation marks omitted).

Ours Garage went on to direct a basic framework for

applying the FAAAA’s safety exception: A state law is saved

from preemption only if it is “genuinely responsive to safety

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16 CTTA V. CITY & CTY. OF SAN FRANCISCO

concerns.” 536 U.S. at 442. We have given that approach

shape by fashioning “a two-part inquiry”:

The first step examines any “expressions of

legislative intent,” including (1) the particular

language of the statute or regulation being

challenged, and any explicit statutory or

regulatory findings in the provision; and

(2) available legislative or regulatory

history. . . . Once a safety motivation is

identified, the second step looks to “the

existing record evidence” to determine

whether there is a “logical” or “genuine”

connection between the regulation and the

safety justification, or, instead, whether the

purported safety justification is a pretext for

undue economic regulation. The more

attenuated or speculative the connection, the

more likely it will be that a court will find the

purported safety motives “illusory or

pretextual” and that the safety justification

will not withstand scrutiny.

CTTA I, 693 F.3d at 860.

CTTA I also articulated some more specific guidelines

concerning the FAAAA’s safety exception “applicable to the

district court’s preemption analysis on remand.” Id. at 863. 

First, while the initial step of the safety-exception test

“addresses whatever traditional sources of legislative intent

are available,” it “also allows for the situation where history

is lacking — especially at a local level where committee

reports or municipal statements might not be published.” Id.

at 864. “[M]erely because a safety rationale is not

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CTTA V. CITY & CTY. OF SAN FRANCISCO 17

documented does not necessarily mean the safety exception

cannot apply,” CTTA I explained, as “[s]ometimes a safety

justification is so obvious that it need not be stated — intent

can be obvious from the subject of the regulation itself, as

well as from the surrounding circumstances.” Id. (citing

Tillison v. Gregoire, 424 F.3d 1093, 1102–03 (9th Cir.

2005)).

Next, CTTA I described how to assess legislative intent

when regulators had “mixed motives” — for example, where

a regulation was motivated by safety concerns and economic

concerns. We observed that “‘[t]he presence of such mixed

motives . . . does not preclude the application of the safety

exception, provided that the State’s safety motives are not

pre-textual.’” Id. at 860 (alteration in original) (quoting Am.

Trucking, 660 F.3d at 405). Determining whether an asserted

safety motive is not pretextual “is equivalent to asking

whether a law is ‘genuinely responsive’ to safety concerns”

— in other words, whether the challenged provision has a

“logical connection” to motor vehicle safety. CTTA I,

693 F.3d at 860.

Finally, we reiterated in CTTA I that proper analysis of an

FAAAA preemption challenge to a comprehensive regulation

must be conducted on a “provision-by-provision basis.” Id.

“‘Were it otherwise, a single valid excepted provision would

allow a vast amount of nonexcepted provisions to stand.’” Id.

(quoting Am. Trucking Ass’ns, Inc. v. City of L.A., 559 F.3d

1046, 1055 (9th Cir. 2009)). “Similarly, the mere fact that

one part of the regulatory scheme is preempted does not mean

that other parts of the scheme are preempted, or that the

scheme as a whole is preempted.” Id.

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18 CTTA V. CITY & CTY. OF SAN FRANCISCO

III.

Before applying the above principles to San Francisco’s

Permit Scheme, we consider a threshold dispute between the

parties over the proper scope of the FAAAA’s safety

exception.

CTTA argues that an appropriately circumscribed

understanding of the Act’s safety exception covers only

regulations related to the “motor vehicle safety” of the tow

trucks themselves — for example, “the manner in which tow

trucks operate, the way they are driven on the roadways, and

the manner in which they transport motor vehicles” — and

not the safety of the people whose vehicles are towed. 

Conversely, the City contends that CTTA “assumes an

artificially narrow definition of the term ‘safety,’” and that,

properly understood, the safety exception covers

“regulation[s] seek[ing] to prevent or mitigate the danger a

person experiences when her motor vehicle is being or has

been towed by another motor vehicle.” The City is correct.

The very language of the safety exception demonstrates

that CTTA’s understanding of the FAAAA’s safety concept

is unduly narrow. Section 14501(c)(2) provides that the

FAAAA “shall not restrict the safety regulatory authority of

a State with respect to motor vehicles.” 49 U.S.C.

§ 14501(c)(2)(A) (emphases added). The safety exception

nowhere mentions “motor vehicle safety,” the talismanic

phrase to which CTTA repeatedly refers.6 Rather, it

6 We acknowledge that courts have occasionally referred to “motor

vehicle safety” when applying the safety exception. See, e.g., Rowe,

552 U.S. at 374; CTTA I, 693 F.3d at 860, 862. But, as noted, the relevant

statutory language contains no such phrase.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 19

expressly states that the FAAAA shall not restrict the State’s

general “safety regulatory authority,” not just its regulatory

authority regarding the safe operation of the regulated motor

vehicles.

Nor does the language of the exception limit the “motor

vehicles” covered by the exemption to the regulated vehicles

covered by the FAAAA as a whole. Indeed, the FAAAA

specifically defines “motor vehicle” for purposes of this part

of the statute as:

a vehicle, machine, tractor, trailer, or

semitrailer propelled or drawn by mechanical

power and used on a highway in

transportation, or a combination determined

by the Secretary, but does not include a

vehicle, locomotive, or car operated only on a

rail, or a trolley bus operated by electric

power from a fixed overhead wire, and

providing local passenger transportation

similar to street-railway service.

49 U.S.C. § 13102(16). “[T]he ‘cardinal canon’ of statutory

construction” is that “Congress ‘says in a statute what it

means and means in a statute what it says there.’” Planned

Parenthood Ariz. Inc. v. Betlach, 727 F.3d 960, 968 (9th Cir.

2013) (quoting Conn. Nat’l Bank v. Germain, 503 U.S. 249,

253–54 (1992)). Congress chose to fashion the FAAAA’s

safety exception to encompass the State’s safety regulatory

authority with respect to the broader category of “motor

vehicles,” generally, instead of the more limited set of

vehicles denoted by the term “[m]otor carriers of property.” 

49 U.S.C. § 14501(c). Accordingly, as tow trucks are

engaged in towing other motor vehicles, the exception in

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20 CTTA V. CITY & CTY. OF SAN FRANCISCO

terms extends to “safety regulatory authority” concerning the

vehicles towed.

Furthermore, “[t]he phrase ‘with respect to’ is generally

understood to be synonymous with the phrase[] ‘relating to.’” 

In re Plant Insulation Co., 734 F.3d 900, 910 (9th Cir. 2013). 

And, although the “the breadth of the words ‘related to’ does

not mean the sky is the limit,” the Supreme Court has

reiterated that the “ordinary meaning of . . . [the] words

[‘related to’] is a broad one,” meaning “having a connection

with or reference to.” Dan’s City Used Cars, Inc. v. Pelkey,

133 S. Ct. 1769, 1778 (2013) (second alteration in original)

(internal quotation marks omitted); see also Nw., Inc. v.

Ginsberg, 134 S. Ct. 1422, 1428, 1430–31 (2014). 

Consequently, the FAAAA’s safety exception exempts from

preemption safetyregulations that “hav[e] a connection with”

motor vehicles, not only those that directly govern the

physical operation of the tow trucks themselves. See Dan’s

City, 133 S. Ct. at 1778.

Consistent with the statutory language, Ace Auto Body &

Towing, Ltd. v. City of N.Y., 171 F.3d 765, 774 (2d Cir.

1999), holding modified on other grounds by Loyal Tire &

Auto Ctr., Inc. v. Town of Woodbury, 445 F.3d 136 (2d Cir.

2006), specifically rejected the argument that the safety

exception “extends only to safety regulation of the

mechanical components of motor vehicles.” Noting that

“[n]either the text nor the legislative history of

§ 14501(c)(2)(A) supports such a narrow reading,” Ace Auto

Body concluded that even if the phrase “safety regulatory

authority . . . with respect to motor vehicles” were

ambiguous, it must be read “to encompass the authority to

enact safety regulations with respect to motor vehicle

accidents and break-downs.” Id.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 21

More generally, and contrary to CTTA’s arguments,

“[c]ase law . . . has on the whole given a broad construction

to the safety regulation exception.” VRC LLC v. City of

Dallas, 460 F.3d 607, 612 (5th Cir. 2006). Ours Garage

specifically rejected “the narrowest possible construction of

the [safety] exception,” 536 U.S. at 440, noting that

Congress’s clear purpose in enacting § 14501(c)(2)(A) was

“to ensure that its preemption of States’ economic authority

over motor carriers of property . . . ‘not restrict’ the

preexisting and traditional state police power over safety,” id.

at 439.

We have likewise held that towing regulations directed at

safety in a fairly broad sense are exempt from preemption

under the FAAAA’s safety exception. Tillison v. City of San

Diego, 406 F.3d 1126, 1127 (9th Cir. 2005), for example,

held that a state law requiring towing companies to obtain

written authorization before removing a vehicle from private

property, fell within the FAAAA’s safety exception. In so

holding, Tillison emphasized the California Legislature’s

statement that it enacted the statute

“to further the safety of the general public by

ensuring that a private property owner or

lessee has provided his or her authorization

for the removal of a vehicle from his or her

property, thereby promoting the safety of

those persons involved in ordering the

removal of the vehicle as well as those

persons removing, towing, and storing the

vehicle.”

Id. at 1129–30 (emphasis added) (quoting Cal. Veh. Code

§ 22658(m)(2)). Tillison v. Gregoire similarly held a state

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22 CTTA V. CITY & CTY. OF SAN FRANCISCO

law restricting patrol and nonconsensual towing exempted by

the FAAAA’s safety exception, listing a number of possible

“safety purposes” animating the law, including “prevent[ing]

involuntary tows and towing mistakes, reduc[ing]

confrontations, and expedit[ing] vehicle recovery.” 424 F.3d

at 1100–01, 1104. Some of these purposes — for example,

reducing confrontations — are related to the safety of

individuals affected by the towing process, but not directly to

the safe operation of the tow trucks when in use as a vehicle.

Finally, in addition to the Second Circuit in Ace Auto

Body, our other sister circuits have interpreted the scope of

the FAAAA’s safety concept consonantly with our cases. 

Cole v. City of Dallas, 314 F.3d 730 (5th Cir. 2002) (per

curiam), for instance, held a Dallas regulation prohibiting the

issuance of a tow driving permit to persons who had been

convicted of certain drug crimes to be “a motor vehicle safety

regulation under 49 U.S.C. § 14501(c)(2)(A).” Id. at 731. “It

is difficult to imagine,” the court explained, “a regulation

with a more direct protective nexus or peripheral economic

burden.” Id. at 735. Cole emphasized that Ours Garage

“anchored” its interpretation of the FAAAA’s safety

exception “to Congress’s desire to leave for the states and

local governments those responsibilities regarding motor

carriers that do not relate to the slender congressional goal of

addressing economic authority over such carriers.” Id. at 733. 

Accordingly, Cole “decline[d] to elasticize Congress’s

economic goal by narrowly interpreting ‘safety regulatory

authority of a State with respect to motor vehicles.’” Id. at

734; see also VRC LLC, 460 F.3d at 615 (holding that an

ordinance requiring explanatory signs concerning towing fell

within the FAAAA’s safety exception as possible “violent

confrontation between unwarned vehicle owners and tow

truck drivers” could be remedied by a sign requirement);

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CTTA V. CITY & CTY. OF SAN FRANCISCO 23

Galactic Towing, Inc. v. City of Miami Beach, 341 F.3d 1249,

1251–52 (11th Cir. 2003) (concluding that a nonconsensual

towing ordinance requiring permits and written authorization

to tow fell within the FAAAA’s safety exception).

In sum, the FAAAA’s safety exception does not, as

CTTA contends, limit the set of valid safety rationales in this

context to those concerned only with the safe physical

operation of the tow trucks themselves. Rather, regulations

that are “genuinely responsive” to the safety of other vehicles

and individuals involved in the towing process may also be

exempted from preemption. Keeping this proper

understanding of the FAAAA’s safety concept in mind, we

turn to CTTA’s specific challenges to San Francisco’s Permit

Scheme.

IV.

We first analyze CTTA’s challenge to the Permit

Scheme’s general permit requirements. We then address the

remaining provisions enabling the operation of the Permit

Scheme, such as the requirements concerning applications,

fees, permit possession and display, and penalties.

A.

The Permit Scheme’s requirements that tow car operators

and tow car firms hold a City-issued permit while operating

in San Francisco, S.F. Police Code §§ 3000, 3050, clearly fall

within the FAAAA’s preemption clause, as they are “related

to a . . . service of [a] motor carrier,” 49 U.S.C.

§ 14501(c)(1). But the permit requirements, we hold, fall

within the Act’s safety exception.

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24 CTTA V. CITY & CTY. OF SAN FRANCISCO

In applying the safety exception, we first “consider

available legislative or regulatory intent” to evaluate

“whether safety relating to motor vehicles was truly a

concern,” using “whatever traditional sources of legislative

intent are available.” CTTA I, 693 F.3d at 860, 864. Neither

party has cited legislative history dating from the initial

enactment of these ordinances, which may not exist. When

amending Article 30.1 in 2009, however, the Board of

Supervisors made explicit findings, some of which are

directly concerned with safety.

Specifically, the Board found “that there is a significant

risk to the safety of residents and visitors when illegal towing

from private property occurs at night,” and “that there is a

risk to public health and safety when the vehicles of senior

citizens and persons with disabilities are illegally towed from

private property.” S.F. Police Code § 3055.2(a)(ii), (iii). 

CTTA maintains that only these safety-related findings are

relevant to evaluating the Permit Scheme. But that argument

assumes that the only safety concerns relevant to the

preemption analysis are those expressly stated in section

3055.2(a). That is not so. As CTTA I emphasized, a safety

justification “can be obvious from the subject of the

regulation itself, as well as from the surrounding

circumstances.” 693 F.3d at 864.

Here, as in Gregoire, it is “reasonable to conclude” from

the Permit Scheme’s subject matter that the legislature “had

public safety in mind when it passed [the law].” 424 F.3d at

1103. Indeed, the California state law allowing

municipalities like San Francisco to regulate towing services

demonstrates clear safety concerns. See Cal. Veh. Code

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CTTA V. CITY & CTY. OF SAN FRANCISCO 25

§ 21100(g)(2).7 Furthermore, the Coggan Declaration —

although not direct evidence of the Board’s intent, as it was

produced after the Permit Scheme was enacted — can be

considered to establish the “surrounding circumstances” in

which the ordinances were passed. CTTA I, 693 F.3d at 864. 

That is, the Declaration is evidence of the broad range of

safety problems arising in the towing industry, such as the

“operati[on] [of]tow trucks in an unsafe manner on the road,”

“stealingmerchandise from towed vehicles,” and instances of

physical or sexual assault by tow operators or their

employees.

Viewing the various indices of regulatory intent in

combination, we find that “safety relating to motor vehicles

was truly a concern” that motivated the Board of Supervisors

to enact the challenged permit requirements.8 CTTA I,

693 F.3d at 860. These safety concerns include the limited

set articulated when enacting the 2009 amendment to Article

 

7

 The California Legislature, in enacting section 21100(g)(2), found:

[T]hat the safety and welfare of the general public is

promoted by permitting local authorities to regulate tow

truck service companies and operators by requiring

licensure, . . . thereby ensuring against towing mistakes

that may lead to violent confrontation, [and] stranding

motorists in dangerous situations . . . . Id.

 

8 To be sure, CTTA’s observation that the Permit Scheme is animated,

in part, by consumer protection concerns is accurate. See S.F. Police Code

§ 3055.2(a)(iv)–(viii). That the Board had reasons other than safety for

enacting the regulation, however, does not compel the conclusion that the

Board’s safety-related findings are “pretextual.” CTTA I instructed that

“mixed motives” do not affect the safety-exception analysis so long as the

challenged regulations have a “logical connection” to the “safety

justification.” 693 F.3d at 860.

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26 CTTA V. CITY & CTY. OF SAN FRANCISCO

30.1 — the risk posed by illegal towing from private property

at night or involving a vehicle belonging to senior citizens

and persons with disabilities — but are not limited to those

concerns. Rather, we may infer from the other indices that

broader safety concerns, including safe operation of the

trucks, physical or sexual assault, the possibility of violent

confrontations, and the stranding of motorists in dangerous

situations, also underlay the enactment of the challenged

permit requirements.

The second prong of the safety exception analysis

requires us to “assess the nexus between the provision at issue

and the safety concern.” CTTA I, 693 F.3d at 860. That

nexus is more than sufficient.

That the permit requirements have a significant and

logical relationship to safety is evident. As the district court

stated, “the presence of a permit requirement implies the

threat of permit revocation,” which makes the requirement “a

tool for policing misconduct in the towing industry.” 

Furthermore, the permit requirement enables the City

proactively to “weed out” and monitor tow car drivers and

firms on an ongoing basis.

CTTA maintains that a more appropriate safety response

by the City would be “to increase the criminal penalties for

[illegal towing],” instead of creating a scheme that “places

enormous regulatory and economic burdens on legitimate

towing firms.” But the FAAAA’s safety exception does not

save from preemption only the least intrusive methods of

promoting safety. Moreover, as Sergeant Coggan reasonably

observed, it maywell be that “the threat of permit nonrenewal

or revocation by administrative action is more effective than

the threat of criminal or civil prosecution, given the relative

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CTTA V. CITY & CTY. OF SAN FRANCISCO 27

certainty and timeliness of the administrative process.” 

CTTA offers no reason to doubt this assessment.

Taking another tack, CTTA complains that the City has

produced “no evidence” that the Permit Scheme has in fact

increased safety or reduced the incidence of illegal towing,

contending that the record evidence is “entirely bereft of any

statistical data” or other “empirical data.” But a regulation

falls within the FAAAA’s safety exception if it is “genuinely

responsive to safety concerns,” a test we have described as

requiring “a logical connection to motor vehicle safety.” 

CTTA I, 693 F.3d at 860 (emphasis added) (internal quotation

marks omitted). That is, the safety exception is concerned

with legislative intent, not legislative effectiveness.

As a third line of attack, CTTA contends that the permit

requirements are not facially concerned with safety. In

CTTA’s view, permissible safety regulations include

regulations such as “requiring tow truck drivers to pass a

driving test, or to demonstrate competence in towing motor

vehicles,” not permit requirements. This argument rests on

CTTA’s incorrect understanding of the FAAAA’s safety

concept, see Part III, supra. As we have explained, the safety

exception is not limited to regulations that narrowly address

“on-the-road” safety for tow trucks; rather, it extends to

regulations that protect safety in connection with motor

vehicles towed and the individuals who interact with tow

truck operators and firms. See, e.g., Tillison, 406 F.3d at

1127; Gregoire, 424 F.3d at 1100–01; VRC LLC, 460 F.3d at

609, 615; Galactic Towing, 341 F.3d at 1251–52; Cole,

314 F.3d at 731. CTTA cannot plausibly claim that revoking

the permit of those tow car drivers and firms who commit

misconduct related to their services, strand motorists in

dangerous locations, or operate dangerously is not logically

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28 CTTA V. CITY & CTY. OF SAN FRANCISCO

connected to improving the safety of individuals involved in

the towing process.

Finally, CTTA invokes Automobile Club of New York,

Inc. v. Dykstra, 520 F.3d 210 (2nd Cir. 2008). Dykstra

involved a challenge to New York City’s comprehensive

regulation of the towing industry “as applied to tow trucks

from outside New York City.” Id. at 212. Holding that

“[e]nforcing the Scheme against tow trucks passing through

New York City or towing vehicles into New York City does

not respond to safety concerns and does not fall within the

safety exception,” id. at 217, Dykstra, presumably because it

focused on those questions, did not discuss — or even cite —

earlier decisions like Cole, VRC, or Galactic Towing, all of

which held that the FAAAA’s safety exception covers towing

permit regulations affecting in-jurisdiction operators. 

Notably, Dykstra observed that tow trucks from New York

City “would presumably already be licensed” under the city’s

permit regulation, without questioning the validity of that

regulation. Id. at 217. Dykstra was thus primarily concerned

with the application of New York City’s permit regulation to

vehicles coming from outside the City.

9 The case does not

support CTTA’s position in this case.

In sum, the permit requirements of sections 3000 and

3050 are “genuinely responsive” to the set of real safety

concerns that underlay enactment of the Permit Scheme. 

Accordingly, these requirements fall within the Act’s safety

exception, and so are exempted from preemption.

9 The question of extraterritorial application is irrelevant in this case, as

the California Court of Appeal held that the Permit Scheme applies only

to those towing firms whose “principal place of business or employment”

is San Francisco. See n.3., supra.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 29

B.

The district court concluded that the majority of the

remaining provisions fell within the FAAAA’s safety

exception, while others were not covered by the FAAAA’s

preemption clause in the first place. CTTA’s arguments

concerning these provisions for the most part suffer from the

same infirmities that undermine its arguments concerning the

general permit requirements. As the district court properly

conducted a thorough “provision-by-provision” analysis, we

address most of the provisions only in brief. We separately

address thereafter section 3052’s complaint-handling system

and business plan requirements, see S.F. Police Code

§ 3052(4).

1. Permit Application Requirements, Sections 3002 and

3052

The district court concluded that the Permit Scheme’s

application and information-collection requirements fall

within the FAAAA’s safety exception.10 We agree.

Requiring tow car operators and tow car firm applicants

to submit identification information as part of their

applications is “logical[ly] connect[ed],” CTTA I, 693 F.3d at

860, to the safety of individuals potentially threatened by

such drivers or firms. Those requirements allow the police

10 The district court also concluded that the application requirements are

subject to the FAAAA’s express preemption clause; the City does not

contest that conclusion. We thus assume without deciding that the

requirements would be preempted if they did not fall within the safety

exception.

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30 CTTA V. CITY & CTY. OF SAN FRANCISCO

more easily to identify drivers and firms that commit

wrongdoing or misconduct.

One of the primary ways by which the Permit Scheme

genuinely responds to safety concerns is by providing police

the capability proactively to monitor the towing industry, a

capability that is predicated on the police having basic

information about tow car drivers. CTTA in fact concedes

that such identifying information “may be helpful to the

police in identifying tow truck drivers,” but argues that such

identification “does nothing to improve towing safety” and

ensure that drivers “will operate their vehicle safely.” But, as

we have explained, the Act’s safety concept is not limited to

the safe physical operation of the tow trucks. Instead, it

includes protection of customers, who may be in vulnerable

situations, from dangerous or irresponsible tow truck

operators. Accurate identification of the tow car operator and

car firm operators helps to provide such protection.

CTTA contends in particular that the requirements that

applicants provide criminal history information as part of

their application, see S.F. Police Code §§ 3002(5), 3052(7),

are preempted by the FAAAA. That these requirements

“genuinely respon[d]” to safety concerns is quite apparent. 

Indeed, “[i]t is difficult to imagine a regulation with a more

direct protective nexus or peripheral economic burden.” 

Cole, 314 F.3d at 735.11

Finally, CTTA argues that, in any event, requiring driver

permit applicants to list all criminal offenses for which they

11 For the same reason, the Permit Scheme’s provisions allowing for

permit denial or revocation due to criminal activity, S.F. Police Code

§§ 3004, 3011, 3054(3) & 3056(1), fall within the Act’s safety exception.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 31

have been arrested is not responsive to safety concerns,

because an arrest is “not competent evidence of any

wrongdoing.” That observation is quite valid, and curbing

the misuse of arrest records is a legitimate concern.12 As the

City points out, however, “the Police Code does not allow a

permit denial based solely on arrest”; any such denials would

be extremely troublesome and could be separately

challenged.13 Simply collecting information on arrests is

12 See Gary Fields & John R. Emshwiller, As Arrest Records Rise,

Americans Find Consequences Can Last a Lifetime, Wall St. J. (Aug. 8,

2014) (observing that “nearly one out of every three American adults”

have arrest records, and that “[m]any people who have never faced

charges, or have had charges dropped, find that a lingering arrest record

can ruin their chance to secure employment, loans and housing”).

In recent guidance concerning the use of criminal records in the

employment context, the Equal Employment Opportunity Commission

explained: “The fact of an arrest does not establish that criminal conduct

has occurred. Arrests are not proof of criminal conduct. Many arrests do

not result in criminal charges, or the charges are dismissed.” EEOC

Enforcement Guidance No. 915.002, Consideration of Arrest and

Conviction Records in Employment Decisions Under Title VII of the Civil

Rights Act of 1964 (2012), available at http://www.eeoc.gov/laws/

guidance/arrest_conviction.cfm. The EEOC further observed that many

states “have enacted laws to limit employer inquiries concerning all or

some arrest records.” Id. n.101. In California, for example, employers —

“whether a public agency or private individual or corporation” — are

generally prohibited from “ask[ing] an applicant for employment to

disclose . . . information concerning an arrest or detention that did not

result in conviction.” Cal. Lab. Code § 432.7(a).

13 The Permit Scheme does allow denial or revocation of a permit where

the driver has “acted in violation” of the listed criminal statutes, even if

not convicted. S.F. Police Code § 3004(b). CTTA provides no

substantive argument challenging this particular ground for denial, either

on the merits or with regard to any procedures that might be required

before denying a permit on that ground. See United States v. Kama,

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32 CTTA V. CITY & CTY. OF SAN FRANCISCO

nonetheless pertinent to assuring accurate identification of

drivers, as arrest records contain identifying information,

including fingerprints and usage of aliases.

In sum, the Permit Scheme’s application requirements,

including the criminal history disclosure requirements, fall

within the scope of § 14501(c)(2)(A), and are therefore not

preempted.

2. Permit Fees, Section 3003 and 3053; Penalties, Sections

3012 and 3064

The district court correctly concluded that the permit fee

and penalty provisions fall within the safety exception.

The filing and license fees reimburse the City for the costs

of processing the application. The permit fees thus directly

support the Permit Scheme’s other requirements. As the

district court explained, “that the permit fee requirements

regulate somewhat more indirectly is not by itself fatal, for,

like the essential permit requirements themselves, they

remain ‘logically’ and ‘genuinely’ connected to obvious

[safety] concerns.”14 “[I]t would make no sense to conclude

394 F.3d 1236, 1238 (9th Cir. 2005) (“Generally, an issue is waived when

the appellant does not specifically and distinctly argue the issue in his or

her opening brief.”).

 

14 CTTA argues that this analysis is contrary to CTTA I’s instruction to

examine a preemption challenge to a comprehensive law on a “provisionby-provision basis.” 693 F.3d at 860. Yet CTTA’s argument overstates

the meaning of CTTA I’s instruction. A provision-by-provision analysis

ensures that “the mere fact that one part of a regulation or group of

regulations might come within an exception to preemption does not mean

that all other parts of that regulation or group are also excepted.” Id.

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CTTA V. CITY & CTY. OF SAN FRANCISCO 33

that certain provisions of the [Permit Scheme] are not

preempted because they are genuinely responsive to safety

concerns, but that the state is forbidden from taking measures

to make those provisions effective.” Prof’l Towing &

Recovery Operators of Ill. v. Box, 965 F. Supp. 2d 981, 1003

(N.D. Ill. 2013).

The penalty provisions for driving or operating a tow

truck in the City without requiring the requisite permit are

likewise integral to the functioning of the Scheme’s permit

requirement. Absent some penalty for noncompliance, the

permit requirement would be a dead letter. CTTA’s only

argument is a reiteration of its basic theme: “While the threat

of misdemeanor convictions may serve as a deterrent to

encourage drivers to comply with the ordinance, there has

been no showing that complying with the ordinance enhances

the safety of the motoring public.” Repeating the same

refrain does not improve it.

We thus hold that the fee and penalty provisions fall

under the safety exception and are not preempted.

3. Possession and Display Requirements, Section 3007 and

3055

The district court concluded that the permit possession

and display requirements “are not subject to FAAAA

preemption” in the first place, as displaying a permit does not

constitute a “service” under § 14501(c)(1). CTTA argues to

the contrary — that directing “drivers to affirmatively

(internal quotations omitted). But CTTA I could not possibly require

courts to ignore the particular function of a provision in the context of the

comprehensive scheme, as doing so would result in absurd outcomes.

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34 CTTA V. CITY & CTY. OF SAN FRANCISCO

perform an act,” such as display a permit to a police officer,

is inherently a “service.”

We cannot agree with CTTA. A requirement designed to

demonstrate compliance with a legal obligation is not

ordinarily termed a “service.” One who hands over his

driver’s license to a police officer when stopped for a traffic

violation, for example, is not providing a “service” to the

officer. Moreover, the only state laws “whose effect is

forbidden under [the FAAAA] are those with a significant

impact on carrier rates, routes, or services.” Rowe, 552 U.S.

at 375 (internal quotation marks and emphasis omitted). 

CTTA has not shown that the permit possession and display

requirements affect its members in any significant manner

distinct from the requirement of obtaining the permit in the

first place.

Consequently, sections 3007 and 3055 are not preempted

by the FAAAA.15

 

15 Dan’s City recently held that for FAAAA preemption to apply, “it is

not sufficient that a state law relates to the ‘price, route, or service’ of a

motor carrier in any capacity; [it] must also concern a motor carrier’s

‘transportation of property.’” 133 S. Ct. at 1778–79 (emphasis added). 

Dan’s City further explained that the “with respect to transportation of

property” phrase “massively limits the scope of preemption ordered by the

FAAAA.” Id. at 1778 (internal quotation marks omitted); see also Mass.

Delivery Ass’n v. Coakley, 769 F.3d 11, 23 (1st Cir. 2014) (“[T]he

FAAAA is carefully tailored to preempt only those statutes that affect a

motor carrier’s transportation of property.”). The permit possession and

display requirements may escape preemption for this additional reason, as

they do not appear related to services “with respect to transportation of

property.” Cf. Dan’s City, 133 S. Ct. at 1779 (defining “transportation”

as “services related to th[e] movement” of property, “including arranging

for, receipt, delivery, elevation, transfer in transit, refrigeration, icing,

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CTTA V. CITY & CTY. OF SAN FRANCISCO 35

4. Complaint System and Business Plan Requirements,

Section 3052(4)

To obtain a tow car firm permit, applicants must include

in their application “[a] description of the applicant’s

business plan, . . . and a system for handling complaints that

is acceptable to the Chief of Police.” S.F. Police Code

§ 3052(4). The district court concluded that both

requirements fell within the FAAAA’s safety exception.16

While we agree that the complaint system requirement

genuinely responds to safety concerns, we conclude that the

business plan requirement falls outside of the safety

exception and is therefore preempted.

(a) Requiring tow car firms to have acceptable systems

for handling customer complaints is logically connected to

improving safety.

First, as the district court found, “having such a complaint

system in place could reduce the incidence of heated

confrontations” between tow car firm employees and

individuals whose vehicles were towed. It is reasonable to

conclude that individuals who are upset or angered by the

towing process are less likely personally to confront tow car

firm operators or employees when they are aware that there

is an official mechanism for handling their complaints. And

reducing such confrontations, we have held, is a permissible

ventilation, storage, handling, packing, unpacking, and interchange of

passengers and property” (quoting 49 U.S.C. § 13102(23)(B)).

16 The City’s counsel agreed at oral argument that the section 3052(4)

requirements are covered by the FAAAA’s express preemption clause. 

We so assume for the purposes of this opinion.

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safety-related concern under the FAAAA. See Gregoire,

424 F.3d at 1103–04.

Second, having an effective complaint system can alert

the tow car firm itself to alleged unsafe conduct by its drivers

or employees. Most fundamentally, the complaint system is

simply an alternative mode of enforcement of the valid safety

regulations. That is, although the complaint system may not

in itself be a direct safety regulation, it — like the Permit

Scheme’s fee and penalty provisions — helps to effectuate

the Scheme’s direct safety-related regulations. Accordingly,

this requirement falls within the FAAAA’s safety exception.

(b) The remainder of section 3052(4)’s business plan

requirement, however, does not fit the safety rubric, even as

broadly understood. The district court held that the Board’s

purpose in enacting this provision was “to ascertain whether

a permitted towing firm would be able to make ends meet

without resorting to illegal means.” The City also points to

the Coggan Declaration, which states that the business plan

allows the City to “assess whether the [applicant] companies

have a plan to transport and store vehicles in a safe manner.”

These asserted roles for the business plan requirement are

belied by the fact that no enforcement provisions are linked

to the requirement. The failure to include a business plan in

the application is not a ground for denying or revoking a tow

car permit. See S.F. Police Code §§ 3054, 3056. Any

connection between the business plan requirement and the

ascertainment of safe practices or capacities is ephemeral.

Moreover, the City’s evidence suggests that the business

plan requirement is intended to further consumer protection,

not safety. For example, Coggan stated that, “[b]y requiring

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CTTA V. CITY & CTY. OF SAN FRANCISCO 37

that companies submit business plans and proposed services

to be provided, the Department can better determine whether

the amount charged by a tow company is commensurate with

the services it regularly provides.” In sum, unlike the other

challenged provision, the business plan requirement is just

not genuinely responsive to safety concerns, and so is

preempted.

We therefore must consider whether the business plan

provision (except for the complaint requirement) is severable

from the remainder of the Permit Scheme. CTTA I explained

that the Scheme’s severance provisions, see S.F. Police Code

§§ 3013, 3065, allow us “to sever a particular provision if it

would not affect the Permit [Scheme] as a whole.” 693 F.3d

at 863. “Severability of a local ordinance is a question of

state law . . . .” City of Lakewood v. Plain Dealer Publ’g Co.,

486 U.S. 750, 772 (1988). In California, the presence of a

severability clause “establishes a presumption in favor of

severance.” Cal. Redevelopment Ass’n. v. Matosantos,

53 Cal. 4th 231, 270 (2011). Additionally, “[t]he invalid

provision must be grammatically, functionally, and

volitionally separable.” Id. at 271.

Grammatical separability — “whether the invalid parts

can be removed as a whole without affecting the wording or

coherence of what remains,” id. (internal quotation marks

omitted) — is certainly satisfied. Section 3052(4) is a

freestanding provision, and so unconnected grammatically to

the rest of the enactment. And after severance, the revised

section reads: “A description of . . . a system for handling

complaints that is acceptable to the Chief of Police,” a

perfectly coherent requirement.

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The latter two severability criteria are also met. The

business plan requirement is a minor — even tangential —

provision of the Permit Scheme. It is neither a requirement

for obtaining a permit nor a means of facilitating, supporting,

or enforcing the permit requirement. Its invalidation

therefore in no way affects the “measure’s operation and

purpose,” making it functionally severable, nor is it of

“critical importance to the measure’s enactment,” making it

volitionally separable. Hotel Emps. & Rest. Emps. Int’l

Union v. Davis, 21 Cal. 4th 585, 613 (1999).

We hold that the business plan requirement is preempted

by the FAAAA, but that the requirement is severable from the

valid complaint requirement contained in section 3052(4),

and from the Permit Scheme more generally.

5. Miscellaneous Provisions

The district court properly concluded that the Permit

Scheme’s recordkeeping requirement, S.F. Police Code

§ 3060, is saved from preemption by the FAAAA’s safety

exception. Like the permit application requirements, the

recordkeeping requirement allows the police more easily to

identify drivers and firms that have committed wrongdoing or

misconduct. Without accurate records, it may be difficult for

law enforcement to investigate alleged dangerous activities,

thus reducing the Permit Scheme’s potential for deterring

unsafe conduct.

Likewise, the district court correctly determined that

section 3055.2, which requires tow firm operators to display

brochures containing a concise summary of California towing

law “in a conspicuous place in the location where a vehicle

owner must come to reclaim their towed vehicle,” S.F. Police

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CTTA V. CITY & CTY. OF SAN FRANCISCO 39

Code § 3055.2(c), falls within the FAAAA’s safety

exception. The Board of Supervisors made its safety-related

findings when adding the brochure requirement in 2009. See

id. § 3055.2(a)(ii)–(iii). This timing indicates a connection

between the requirement and the Permit Scheme’s safety

concerns. Nor is there any indication that the Board’s

findings were pretextual. As the district court explained, the

requirement is “obviously aimed at discouraging improper

towing . . . and prevent[ing] illegal tows [] evinces a genuine

motor vehicle safety concern.” Like a requirement that tow

car firms post explanatory signs, upheld by the Fifth Circuit

in VRC LLC, 460 F.3d at 615, the brochures required by the

Permit Scheme promote safety by providing consumers with

information that could reduce confrontation. Furthermore,

the brochure requirement, like the fees and penalties

provisions, enable the effectiveness and enforcement of the

other safety-related provisions by ensuring that customers are

aware of their rights, and so able to register complaints when

they are violated. Cf. Prof’l Towing, 965 F. Supp. 2d at

1003.17

In sum, the Permit Scheme’s recordkeeping and brochure

requirements fall within the FAAAA’s safety exception, and

are therefore saved from preemption.

V.

We reverse the district court’s grant of summary

judgment to the City as to section 3054(2)’s business plan

requirement, and remand to the district court for further

17 Of course, for the brochure requirement to survive preemption, the

concise summary of state laws included in the brochure must not refer to

any laws that themselves are preempted.

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proceedings consistent with this opinion. We otherwise

affirm the district court’s judgment.18

AFFIRMED IN PART, REVERSED IN PART, AND

REMANDED.

CTTA will bear the costs of appeal.

18 We note that no argument concerning the amount of the fees was

presented to this panel in the briefs or at oral argument.

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