FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ALLIANCE OF NONPROFITS FOR

INSURANCE, RISK RETENTION

GROUP,

Plaintiff-Appellee,

v.

SCOTT J. KIPPER, Commissioner of

Insurance of the State of Nevada,

Defendant,

and

DEPARTMENT OF BUSINESS AND

INDUSTRY, DIVISION OF INSURANCE;

STATE OF NEVADA; SCOTT J. KIPPER,

Commissioner of Insurance of the

State of Nevada,

Defendants-Appellants.

No. 11-16836

D.C. No.

2:10-cv-01749-

JCM-RJJ
2 ALLIANCE OF NONPROFITS V. KIPPER

ALLIANCE OF NONPROFITS FOR

INSURANCE, RISK RETENTION

GROUP,

Plaintiff-Appellee,

v.

SCOTT J. KIPPER, Commissioner of

Insurance of the State of Nevada;

DEPARTMENT OF BUSINESS AND

INDUSTRY, DIVISION OF INSURANCE;

STATE OF NEVADA,

Defendants-Appellants.

No. 11-17871

D.C. No.

2:10-cv-01749-

JCM-RJJ

OPINION

Appeal from the United States District Court

for the District of Nevada

James C. Mahan, District Judge, Presiding

Argued and Submitted

February 11, 2013—San Francisco, California

Filed April 8, 2013

Before: Jerome Farris, Sidney R. Thomas,

and N. Randy Smith, Circuit Judges.

Opinion by Judge N.R. Smith
ALLIANCE OF NONPROFITS V. KIPPER 3

SUMMARY*

Insurance / Preemption

The panel affirmed in part and vacated in part the district

court’s judgment in favor of a risk retention group, which

claimed that an order of the Nevada Commissioner of

Insurance violated the Liability Risk Retention Act.

Affirming the district court’s entry of declaratory and

injunctive relief, the panel held that the Act preempted the

Commissioner’s order prohibiting the risk retention group

from writing “first dollar” automobile liability insurance

policies because the order made it unlawful for the group to

operate in Nevada. The panel held inapplicable an exception

for state laws that specify acceptable means for

demonstrating financial responsibility, where the state has

required such a demonstration as a condition for obtaining a

license or permit. The panel stated that the Commissioner’s

order could not be saved from preemption because, under

National Warranty Ins. Co. v. Greenfield, 214 F.3d 1073 (9th

Cir. 2000), it violated the Act’s anti-discrimination provision.

The panel vacated the district court’s award of attorneys’

fees under 42 U.S.C. § 1988 because the Act’s preemption

provision did not unambiguously confer a right to be free

from state law that can be enforced under 42 U.S.C. § 1983.

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

been prepared by court staff for the convenience of the reader.
4 ALLIANCE OF NONPROFITS V. KIPPER

COUNSEL

Catherine Cortez Masto, Attorney General, and Shane D.

Chesney (argued), Senior Deputy Attorney General, Carson

City, Nevada; Joanna N. Grigoriev (briefed and argued),

Deputy Attorney General, Las Vegas, Nevada, for

Defendants-Appellants.

Kimberly Maxson-Rushton (briefed and argued), Cooper

Levenson April Niedelman & Wagenhein, P.A., Las Vegas,

Nevada, for Plaintiff-Appellee.

Robert H. Myers, Jr. and Cindy Chang, Morris Manning &

Martin, LLP, Washington, D.C., for Amici Curiae Captive

Insurance Companies Association, National Risk Retention

Association, Nevada Captive Insurance Association, and

Vermont Captive Insurance Association.

Susan Stapp, Assistant Chief Counsel; Jill A. Jacobi (argued),

Senior Staff Counsel, California Department of Insurance,

San Francisco, California, for Amicus Curiae California

Insurance Commissioner Dave Jones.

Daniel Labrie, Housing AuthorityRisk Retention Group, San

Francisco, California, for Amicus Curiae Housing Authority

Risk Retention Group, Inc.

Jan Holt, United Educators; Thomas W. Brunner, Lawrence

H. Mirel, A. Xavier Baker, Wiley Rein LLP, Washington

D.C., for Amicus Curiae United Educators Insurance, a

Reciprocal Risk Retention Group.
ALLIANCE OF NONPROFITS V. KIPPER 5

Clifford Peterson and David Cassetty, Vermont Department

of Banking, Insurance, Securities, and Health Care

Administration, Montpelier, Vermont, for Amicus Curiae

Vermont Department of Banking, Insurance, Securities, and

Health Care Administration.

Robert M. McKenna, Attorney General; Marta U. DeLeon,

Assistant Attorney General, Olympia, Washington, for

Amicus Curiae Washington State Insurance Commissioner

Mike Kreidler.

OPINION

N.R. SMITH, Circuit Judge:

The Liability Risk Retention Act (the “LRRA”) broadly

preempts “any State law, rule, regulation, or order to the

extent that such law, rule, regulation, or order would . . .

make unlawful, or regulate, directly or indirectly, the

operation of a risk retention group.” 15 U.S.C. § 3902(a)(1). 

This provision preempts the Order of the Nevada

Commissioner of Insurance (the “Commissioner”), which

prohibited Alliance of Nonprofits for Insurance, Risk

Retention Group (“ANI”) from writing “first dollar” liability

policies in Nevada. Therefore, we affirm the district court’s

entry of declaratory and injunctive relief in favor of ANI. 

However, because the LRRA’s preemption provision does not

unambiguously confer a right to be free from state law that

can be enforced under 42 U.S.C. § 1983, we vacate the fee

award.
6 ALLIANCE OF NONPROFITS V. KIPPER

FACTS

ANI is a risk retention group (“RRG”),1chartered in

Vermont. In 2001, ANI registered with the Division of

Insurance of Nevada’s Department of Business and Industry

(the “Division”) to transact liability insurance in Nevada. By

registering with the Division, ANI obtained a Certificate of

Registration; however, the Division has not issued ANI a

Certificate of Authority.

2

As a registered insurer, ANI provided “first dollar,

automobile liability coverage to its Nevada members.” “First

dollar” insurance policies are “motor vehicle polices that are

required by state law to comply with financial responsibility

minimums.” For example, to register a vehicle in Nevada,

state law requires the owner to obtain an insurance policy that

covers, at a minimum, $15,000 per person, per accident;

$30,000 per two or more persons, per accident; and $10,000

of property damage, per accident. Nev. Rev. Stat. § 485.185. 

A policy that meets these coverage requirements is a “first

dollar” liability policy, because the first dollars paid out on a

claim (up to the coverage limits) are paid out under the

policy.

1

In general, an RRG is an insurance company that only insures the

liability risks of its owners. See 15 U.S.C. § 3901(a)(4)(A), (E). 

However, § 3901(a)(4) enumeratesseveral requirements that anRRG must

satisfy in order to come within the scope of the LRRA’s coverage.

 

2

 Moreover, it appears that ANI has never sought to obtain one.
ALLIANCE OF NONPROFITS V. KIPPER 7

Under Nevada’s Motor Vehicle Insurance and Financial

Responsibility Act (“NMVIFRA”),3 Nev. Rev. Stat.

§§ 485.010–.420, automobile owners (who have registered

their cars in the state) must obtain their first dollar liability

policy from a provider who is “authorized to transact

business” in Nevada. Id. §§ 485.185, .037(1), .055(1). Only

insurers who possess a “certificate of authority” from the

Commissioner are authorized to transact business in the state. 

Id. § 679A.030(1). ANI does not have such a certificate. As

a result, in April 2010, the Nevada Department of Motor

Vehicles (“DMV”) began denying vehicle registrations to

vehicle owners who obtained their first dollar liability

policies from ANI.

In May 2010, ANI sought a hearing before the

Commissioner. Following the hearing, the Commissioner

issued an Order prohibiting ANI from writing first dollar

liability policies in Nevada. The Commissioner’s Order

contained the following relevant provision:4

1. ANIshall, within sixty (60) days from the

date of this Order, cease and desist writing

first dollar or mandated motor vehicle

financial responsibility insurance

coverage, required by NRS 485.3091.

ANI may directly write excess liability

3 Laws like the NMVIFRA, which require motorists to provide proof of

financial responsibility, are referred to generically in this opinion as

“MVIFRAs”—motor vehicle insurance and financial responsibility acts.

 

4

 The Commissioner amended paragraph 1 of the Order two days after

entering it. The portion of paragraph 1 quoted above contains the

amended provision.
8 ALLIANCE OF NONPROFITS V. KIPPER

coverage; however, a fronting

arrangement with an authorized insurer

that holds a valid Nevada certificate of

authority shall be required to provide first

dollar or mandated motor vehicle financial

responsibility insurance coverage,

required by NRS 485.3091.

Primarily, the Commissioner enjoined ANIfrom writing first

dollar liability insurance, because it did not possess a

Certificate of Authority and, therefore, was not an

“authorized insurer.”5

ANI then filed this lawsuit, in the United States District

Court for the District of Nevada, seeking declaratory and

5 Though it could be implied, the Order does not explicitly state that

ANI was prohibited from obtaining a Certificate of Authority from the

Commissioner. It states that “[i]nsurers that hold a Nevada certificate of

authority are . . . subject to the Nevada Insurance Guaranty Association

(‘NIGA’),” but acknowledges that—under the LRRA—RRGs like ANI

“cannot participate in the NIGA.” See 15 U.S.C. § 3902(a)(2). Such a

statutory scheme would clearly be preempted by the LRRA under

National Warranty Ins. Co. RRG v. Greenfield, 214 F.3d 1073 (9th Cir.

2000). See infra. However, it appears that this may not be how Nevada’s

statutory scheme actually operates. After the parties filed motions for

summary judgment, the Commissioner filed an affidavit to “clarify any

possible ambiguity” in the Order. That affidavit indicates that domestic

RRGs can become authorized insurers by obtaining a Nevada Certificate

of Authority, and that RRGs are not required to join the NIGA in order to

obtain such a certificate. Assuming that the Commissioner’s affidavit

correctly states the law, RRGs may therefore write first-dollar liability

policies in Nevada. However, the affidavit does not state that this route

is available to foreign RRGs, like ANI. Additionally, while the

Commissioner’s interpretations of state statutes in the affidavit are welltaken, the Commissioner has not pointed to a Nevada law that would

permit his affidavit to change the legal effect of the Order.
ALLIANCE OF NONPROFITS V. KIPPER 9

injunctive relief against the Commissioner and the Division

of Insurance under 42 U.S.C. § 1983. The parties filed crossmotions for summary judgment. Ruling on the motions, the

district court granted summary judgment to ANI in an order

without any discussion. The relevant parts of the order state:

IT IS FURTHER ORDERED THAT Nev.

R. Stat. 485.185, Nev R. Stat. 679A.030(1)

and Nev. R. Stat. 687A.040 and related

statutes and regulations ofthe State of Nevada

are preempted by the [LRRA] pursuant to the

Supremacy Clause of the Constitution, as

applied to [ANI] insofar as they prohibit

[ANI] from issuing first dollar automobile

liability insurance policies in the State of

Nevada.

IT IS FURTHER ORDERED THAT the

phrase “authorized insurer,” as used in the

Nev. R. Stat. 679A.030, shall be interpreted to

include [RRGs] such as [ANI].

IT IS FURTHER ORDERED THAT

defendants are permanently enjoined from

enforcing Nev. R. Stat. 485.185, Nev. R. Stat.

679A.030(1) and Nev. R. Stat. 687A.040 and

related statutes and regulations against

members of [ANI], insofar as they prohibit

[ANI] from issuing first dollar automobile

liability insurance policies in the State of

Nevada.

IT IS FURTHER ORDERED THAT

[ANI] is entitled to a remedy under 42 U.S.C.
10 ALLIANCE OF NONPROFITS V. KIPPER

§ 1983 and, therefore is entitled to an award

of attorney fees under 42 U.S.C. § 1988 to be

set pursuant to FRCP 54.

As the prevailing party, ANI then requested $127,828.00

in fees and $4,643.41 in costs. In its request, ANI sought to

recover fees and costs both for itself and for its amicus, the

National Risk Retention Association (NRRA). For itself,

ANIrequested $83,572.50 in fees and $3,341.75 in costs. For

the NRRA, ANI requested $44,255.50 in fees and $1,301.66

in costs. On November 2, 2011, the district court awarded

ANI $86,914.25 in fees and costs, but only awarded costs to

the NRRA in the amount of $1,301.66. The Commissioner

then appealed.

On appeal, the Commissioner challenges both the grant of

summary judgment and the award of attorneys’ fees.6 The

Commissioner argues that ANIwas not entitled to declaratory

or injunctive relief, because the LRRA does not preempt

Nevada law. The Commissioner also argues that, even if the

LRRA does preempt Nevada law, ANI was not entitled to

attorneys’ fees. We affirm the district court’s entry of

declaratory and injunctive relief, but vacate the fee award.

6 The Commissioner does not challenge the district court’s award of

costs on appeal, and neither ANI nor the NRRA have cross-appealed the

district court’s denial of fees to the NRRA.
ALLIANCE OF NONPROFITS V. KIPPER 11

DISCUSSION

I. The district court correctly held that the LRRA

preempts the Commissioner’s Order.

We review the district court’s grant of summary judgment

to ANI, finding that the LRRA preempts the Commissioner’s

Order, de novo. Schmidt v. Contra Costa Cnty., 693 F.3d

1122, 1132 (9th Cir. 2012). “In this case, there are no

disputes about the material facts.” Samson v. City of

Bainbridge Island, 683 F.3d 1051, 1057 (9th Cir. 2012). 

Therefore, “the only question is the legal one of whether [the

LRRA preempts Nevada law].”7

 Id.

The LRRA broadly preempts “any State . . . order to the

extent that such . . . order would . . . make unlawful, or

regulate, directly or indirectly, the operation of [an RRG].” 

15 U.S.C. § 3902(a)(1). Here, the Commissioner’s Order

makes it unlawful for ANI, an RRG, to operate in Nevada, to

the extent ANIsought to write first dollar liability insurance. 

Thus, the Order plainly fits within the scope of LRRA

preemption. Because the Order fits within the scope of

7 The parties did not clearly identify whether the state law at issue was

the Commissioner’s Order or Nevada’s statutory scheme. However, ANI

appealed from the district court’s summary judgment order, where the

court held that the LRRA preempted a group of Nevada statutes “as

applied to [ANI] insofar as they prohibit [ANI] from issuing first dollar

automobile liability insurance policies in the State of Nevada.” Since the

Commissioner’s Order applied Nevada law to ANI, the preemption

effected by the district court’s decision is logically limited to that Order. 

Moreover, at the summary judgment hearing, the court clarified that the

relevant issue was whether the Commissioner’s Order was preempted, not

whether the state statutes themselves were preempted. Like the district

court, we therefore confine our analysis to the Commissioner’s Order.
12 ALLIANCE OF NONPROFITS V. KIPPER

LRRA preemption, it is invalid unless one of the LRRA’s

exceptions from preemption applies.

Only one exception is relevant here.8 Section 3905(d)

saves from preemption state laws that “specify acceptable

means of demonstrating financial responsibility where the

State has required a demonstration of financial responsibility

as a condition for obtaining a license or permit to undertake

specified activities.” 15 U.S.C. § 3905(d). Nevada’s

MVIFRA (which gave rise to the Commissioner’s Order) is

an example of such a state statute. The NMVIFRA requires

those who own or operate a vehicle in Nevada to demonstrate

financial responsibility in order to register and operate the

vehicle. See Nev. Rev. Stat. § 485.187(1)(a); id. § 482.205. 

Owners and operators demonstrate financial responsibility by

providing proof of insurance from an authorized insurance

provider in specified minimum coverage amounts. Id.

§ 485.185.

Section 3905(d) of the LRRA preserves Nevada’s ability

to specify which types of insurance may satisfy this

requirement. Specifically, § 3905(d) permits states to

“include or exclude insurance coverage obtained from . . . [an

RRG]” as a means of satisfying the state’s financial

responsibility requirements. 15 U.S.C. § 3905(d). Arguably,

the Commissioner’s Order does not fit within this exception,

because it bars ANI from writing a certain type of insurance

8 The Commissioner and his amicus suggest that the exception from

preemption in 15 U.S.C. § 3905(a) applies in this case. That section

carves out from the LRRA’s general preemption “the policy form or

coverage requirements of any State motor vehicle no-fault or motor

vehicle financial responsibility insurance law.” 15 U.S.C. § 3905(a). 

However, this exception does not apply here, because the Commissioner’s

Order had nothing to do with policy form or coverage requirements.
ALLIANCE OF NONPROFITS V. KIPPER 13

policy altogether. Thus, it goes beyond merely excluding

first dollar liability policies written by ANI from the

acceptable class of insurance policies that will satisfy

Nevada’s financial responsibility requirement.

Assuming, however, that the Order fits within the scope

of § 3905(d), it still would not qualify for the exception. 

Section 3905(d) is “subject to the provisions of section

3902(a)(4)”—the LRRA’s anti-discrimination provision. 

Section 3902(a)(4) preempts state laws that “otherwise,

discriminate against a risk retention group or any of its

members.” Under our precedent, the Commissioner’s Order

discriminates against ANI in violation of this section.

In National Warranty Insurance Co. v. Greenfield,

214 F.3d 1073 (9th Cir. 2000), we held that the LRRA

preempted the Oregon Service Contract Act (the “OSCA”),

and that the OSCA did not qualify for the § 3905(d)

exception from preemption. Similar to the NVMIFRA, the

OSCA required car dealers in Oregon who sold vehicle

service contracts to demonstrate financial responsibility by

obtaining insurance coverage for their contract obligations

from an “authorized insurer.” Id. at 1075–76. Through a

combination of state statutes and the LRRA, RRGs not

domiciled in Oregon could not become authorized insurers,

because they could not obtain a “certificate of authority.” Id.

at 1076. As a result, Oregon “effectively preclude[d] all

RRGs from providing insurance coverage for motor vehicle

service contracts.” Id. at 1076 (emphasis added). We

concluded that such laws, which exclude all RRGs from

providing a certain type of insurance, do not qualify for the

§ 3905(d) exception.
14 ALLIANCE OF NONPROFITS V. KIPPER

We also held that the OSCA violated the § 3902(a)(4)

anti-discrimination provision.9Id. at 1082. To make that

determination, we held that insurers could prove that a state

law discriminated in violation of § 3902(a)(4) by showing

that a lawdifferentiates between insurance providers “without

an acceptable justification.” Id. at 1081. Thus, to survive

§ 3902(a)(4), “the state must show that a law differentiating

between an RRG and an [authorized insurer]—or between all

RRGs and all [authorized insurers]—is justified by the desire

to” “protect those who would benefit from the purchase of

insurance.” Id. at 1078, 1081. Members of the public, who

may suffer harm as a result of the policyholder’s conduct,

benefit from the purchase of first dollar liability policies. The

insurer’s obligation under the policy to pay claims made

against its insured increases an injured individual’s

opportunity for recovery. The LRRA expressly permits states

to regulate RRGs in order to protect the interests of such

individuals. As a result, “state laws requiring an RRG to

engage in fair settlement practices, to designate an agent for

the service of process, to submit to examinations necessary to

insure financial soundness, [and] to avoid false and

misleading advertisements” are exemptfrompreemption. Id.;

see also 15 U.S.C. § 3902(a)(1). Nevertheless, in National

Warranty, the State of Oregon did not offer such a

justification for preventing all RRGs from writing insurance

that would satisfy the OSCA’s financial responsibility

9

In part of that holding not relevant here, we concluded that § 3905(d)

“permits the state to exclude coverage only from particular RRGs,” not

from all RRGs. Id. at 1078, 1081–82 (emphasis added). Oregon’s

statutory scheme did not fit within this provision, because the OIGA

membership requirement effectively precluded all RRGs from writing

service-contract insurance. However, as discussed above, the

Commissioner’s Order excluded only a particular RRG (ANI), which

National Warranty permits if it is non-discriminatory.
ALLIANCE OF NONPROFITS V. KIPPER 15

requirement. Id. at 1081–82. By differentiating between

RRGs and authorized insurers without an acceptable

justification, the OSCA violated § 3902(a)(4).

We reach the same conclusion in this case. The

Commissioner’s Order bars ANI from writing first dollar

insurance, because ANI does not possess a Certificate of

Authority. The Order itself does not provide any other

acceptable justification for treating ANI differently than

authorized insurers; the Commissioner has not cited any other

acceptable justification on appeal. Thus, the Order violates

§ 3902(a)(4) by differentiating between ANI and authorized

insurers without an acceptable justification. Accordingly, it

cannot be saved from preemption by § 3905(d).

None of the Commissioner’s objections to this analysis

are persuasive. First, the Commissioner urges us to overrule

National Warranty and to instead adopt the reasoning of the

Eleventh and Seventh Circuits. See Mears Transp. Grp. v.

Florida, 34 F.3d 1013 (11th Cir. 1994); Opthalmic Mutual

Ins. Co. v. Musser, 143 F.3d 1062 (7th Cir. 1998). Under

those cases, a plaintiff could only prove discrimination under

§ 3902(a)(4) by proving intentional discrimination. Mears,

34 F.3d at 1018; Opthalmic, 143 F.3d at 1069–70. However,

under our circuit precedent, we must apply National

Warranty here. It is binding authority that no competent

body has overruled. See Gonzalez v. Arizona, 677 F.3d 383,

389 n.4 (9th Cir. 2012) (en banc). Additionally, we decided

National Warranty after both Mears and Opthalmic, and

considered the reasoning of those opinions before reaching

our holding in National Warranty. See National Warranty,

214 F.3d at 1082 (“[W]e know that, in deciding [this case] as

we do, we disagree with the Seventh and Eleventh Circuits.”). 
16 ALLIANCE OF NONPROFITS V. KIPPER

Accordingly, we decline the Commissioner’s invitation to

revisit National Warranty.

Second, the Commissioner argues that Nevada’s statutory

scheme is not discriminatory. Even if that is true, the

Commissioner’s argument misses the point that the state law

at issue here is the Commissioner’s Order, which prohibits

ANI from writing first dollar liability insurance. Thus, it is

not relevant to this case that (as the Commissioner asserts)

state statutes do not prevent domestic RRGs from obtaining

Certificates of Authority and, therefore, writing first dollar

liability insurance. It is also not relevant that foreign RRGs

like ANI could use certain workarounds to effectively write

first dollar insurance in other ways, e.g., by self-insuring, or

entering into a “fronting” arrangement with a Nevada-based

company.

10 Because the Commissioner’s Order itself is

discriminatory, it is preempted by the LRRA.

Finally, the Commissioner argues that, even if Nevada’s

MVIFRA does discriminate against RRGs, that

10 In addition to being irrelevant, these options are not satisfactory

alternatives for foreign RRGs like ANI. ANI cannot use self-insurance to

provide liability insurance to its members, because only entities that own

more than ten vehicles may satisfy the financial responsibility requirement

by self-insuring. See Nev. Rev. Stat. § 485.380(1). ANI is an insurer, not

an insured, and thus it does not own any vehicles in Nevada. 

Additionally, forcing ANI to take the circuitous route of entering into a

fronting arrangement with a Nevada-based entity in order to provide first

dollar liability policies to nonprofits within the state is contrary to the

purposes of the LRRA. One of the main purposes for the LRRA’s

enactment was the elimination ofstate-law hurdles to interstate operation. 

See infra p. 22. Thus, although Nevada law would technically permit ANI

to effectively provide first dollar liability insurance through other means,

the fact remains that ANI (and presumably other foreign RRGs) would be

the only insurance companies required to take those steps.
ALLIANCE OF NONPROFITS V. KIPPER 17

discrimination is justified, because it is done in the interest of

protecting “innocent third parties” who may be harmed by a

policyholder, and therefore make a claim against the

insurance company. Although we are not analyzing Nevada’s

MVIFRA itself here, we will assume that the Commissioner

would offer this same justification in support of his Order. 

On that assumption, we have recognized that the “state’s

desire to protect those who would benefit from the purchase

of insurance” could justify differentiating between an RRG

and another insurer. See National Warranty, 214 F.3d at

1081. However, this policy concern fails to justify the

Commissioner’s differentiation between ANI and authorized

insurers. The Commissioner does not suggest that, because

it lacks a Certificate of Authority, ANI presents a greater risk

to those who would benefit from the purchase of insurance

than an authorized insurer. Contrary to the Commissioner’s

assertion, a Certificate of Authority is not necessary to

provide such protection. Nevada law requires RRGs (who

don’t have a Certificate of Authority) to comply with

requirements that facilitate the Commissioner’s oversight of

their operations. Nev. Rev. Stat. § 695E.140(3). For

example, each foreign RRG must submit to examinations by

the Commissioner “to determine its financial condition.” Id.

§ 695E.190(1); see also 15 U.S.C. § 3902(a)(1)(E) (excepting

such requirements from preemption under the LRRA). 

Further, as recognized in National Warranty, the LRRA

permits states to protect the interest of those who benefit from

the purchase of insurance through a variety of means,

obviating the need for an RRG to obtain a Certificate of

Authority from a state. See National Warranty, 214 F.3d at

1081. Therefore, the Commissioner can still protect innocent

third parties against the risks ANImight present, even though

it does not have a Certificate of Authority. Accordingly, the
18 ALLIANCE OF NONPROFITS V. KIPPER

Commissioner’s proffered justification for treating ANI

differently from an authorized insurer fails.

We agree with the district court that the LRRA preempts

the Commissioner’s Order. Accordingly, we affirm the

district court’s grant of summary judgment to ANI on its

preemption claim.

II. ANI is not entitled to attorneys’ fees under 42 U.S.C.

§ 1988.

Because ANI brought this suit under 42 U.S.C. § 1983

and was the prevailing party, the district court awarded ANI

attorneys’ fees under 42 U.S.C. § 1988. On appeal, the

Commissioner argues that ANI was not entitled to attorneys’

fees, because preemption of state law under the LRRA is not

a “right” that can be enforced under 42 U.S.C. § 1983. We

agree with the Commissioner, and vacate the fee award.11

As a predicate to an award of attorneys’ fees under

42 U.S.C. § 1988, one must bring an “action or proceeding to

enforce . . . [42 U.S.C. § 1983].” 42 U.S.C. § 1988(b). 

Section 1983 provides a cause of action for the “deprivation

of any rights, privileges, or immunities, secured by the

Constitution and laws [of the United States].” Therefore, to

determine whether ANI is entitled to an award of attorneys’

11 Because we conclude that the LRRA does not confer a right to be free

from state law that can be enforced under § 1983, we do not need to reach

the Commissioner’s argument that he is immune from liability for fees. 

Additionally, we note that federal statutes other than § 1983 provided the

district court with authority to enter declaratory and injunctive relief. See

28 U.S.C. § 2201; 28 U.S.C. § 2202; see Rincon Band of Mission Indians

v. Harris, 618 F.2d 569, 575 (9th Cir. 1980) (noting that 28 U.S.C. § 2202

authorizes district courts to grant injunctive relief).
ALLIANCE OF NONPROFITS V. KIPPER 19

fees, we must first determine whether the LRRA’s

preemption provision confers an enforceable right to be free

from state law. No federal courts of appeal have directly

analyzed whether 15 U.S.C. § 3902 of the LRRA confers

such a right on RRGs.12

“[T]he Supremacy Clause, of its own force, does not

create rights enforceable under § 1983.” See Golden State

Transit Corp. v. City of L.A., 493 U.S. 103, 107 (1989)

(footnote omitted). Accordingly, “it would obviously be

incorrect to assume that a federal right of action pursuant to

§ 1983 exists every time a federal rule of law pre-empts state

regulatory authority.” Id. at 108. Instead, we must analyze

the statute that allegedly gives rise to the enforceable right to

determine whether Congress conferred such a right in the

statute. In Blessing v. Freestone, 520 U.S. 329, 340–41

(1997), the Supreme Court outlined the three-factor

framework for conducting such an analysis. A statute only

confers an enforceable right if (1) the plaintiff demonstrates

that “Congress . . . intended that the provision in question

benefit the plaintiff,” (2) “the plaintiff . . . demonstrate[s] that

the right assertedly protected by the statute is not so ‘vague

and amorphous’ that its enforcement would strain judicial

competence,” and (3) “the provision giving rise to the

12

In White Mountain Apache Tribe v. Williams, 810 F.2d 844 (9th Cir.

1987), we held that claims of field and conflict preemption were not rights

that could be enforced under § 1983. Id. at 850. However, White

Mountain does not control this case, because the LRRA preempts state

law expressly. See 15 U.S.C. § 3902(a). Additionally, in National

Warranty, the district court concluded that LRRA preemption could be

enforced under § 1983. 24 F. Supp. 2d. 1096, 1109–10 (D. Or. 1998). We

affirmed, but did not address the issue of whether actual preemption

conferred a right that could be enforced under § 1983. See generally

National Warranty, 214 F.3d 1073.
20 ALLIANCE OF NONPROFITS V. KIPPER

asserted right [is] couched in mandatory, rather than

precatory, terms.” Id. The Supreme Court clarified what

evidence was sufficient to satisfy the first factor in Gonzaga

University v. Doe, 536 U.S. 273, 276 (2002). There, the

Court held that the mere fact that a plaintiff benefited from a

statute did not give him or her a right to sue under § 1983

when the statute was violated. See id. at 283; see also

Blessing, 520 U.S. at 340 (“In order to seek redress through

§ 1983, however, a plaintiff must assert the violation of a

federal right, not merely a violation of federal law.”). Rather,

Congress must have “unambiguously conferred” a right on a

plaintiff for that plaintiff to have a cause of action under

§ 1983. Gonzaga Univ., 536 U.S. at 283.

Here, even though ANI benefits from the LRRA

(particularly the freedom from multiplicitous and

discriminatory state regulation), “fall[ing] within the general

zone of interest that the statute is intended to protect” is not

enough. Id. at 283. Rather, to enforce LRRA preemption

under § 1983, ANI must demonstrate that Congress

“unambiguously conferred [a] right” on it. Id. Analyzing the

text of 15 U.S.C. § 3902(a)(1) and the legislative history of

the LRRA, we cannot say that Congress unambiguously

conferred a right on RRGs to be free from state law in the

LRRA. See Gonzaga Univ., 536 U.S. at 286; Ball v. Rodgers,

492 F.3d 1094, 1106 (9th Cir. 2007) (“[W]e have sometimes

turned to a statute’s legislative history to help flesh out

congressional intent regarding the creation of a federal

right.”).

Initially, looking exclusively at the text of § 3902(a)(1),

one could conclude that Congress did employ“rights-creating

language” when it preempted state laws that regulate RRGs. 

Gonzaga Univ., 536 U.S. at 287. In Gonzaga University, the
ALLIANCE OF NONPROFITS V. KIPPER 21

Court pointed to the “individually focused terminology of

Titles VI and IX” as paradigmatic rights-creating language. 

See Gonzaga Univ., 36 U.S. at 284 n.3, 287. Title VI

provides that “No person in the United States shall . . . be

subjected to discrimination under any program or activity

receiving Federal financial assistance.” 42 U.S.C. § 2000d. 

Employing a similar construction, Title IX states “No person

in the United States shall, on the basis of sex, . . . be subjected

to discrimination under any education program or activity

receiving Federal financial assistance.” 20 U.S.C. § 1681(a). 

Such language, which is “phrased in terms of the persons

benefited,” is necessary evidence that Congress intended to

create an enforceable right. See id. at 284 & n.3.

Like the terminology of Title VI and Title IX, the

language of § 3902(a) is also phrased in terms of the

“benefited” person. Section 3902(a) specifies that “a risk

retention group is exempt from any State law, rule,

regulation, or order . . . .” 15 U.S.C. § 3902(a). Thus, just as

Titles VI and IX declare that no person shall be subject to

discrimination, § 3902(a) effectively declares that no RRG

shall be subject to state regulation. All three statutes are

phrased in terms of the benefited party. Yet, even if such

language is necessary to the conclusion that Congress

intended to create an enforceable right, see Watson v. Weeks,

436 F.3d 1152, 1159 (9th Cir. 2006), that does not mean it is

sufficient to do so. Rather, we ultimately must determine

whether “Congress intended to create a federal right.” 

Gonzaga Univ., 536 U.S. at 283. The legislative history of

the LRRA indicates that Congress had no intention of

conferring a right to be free from state law on RRGs that

would be enforceable under § 1983.
22 ALLIANCE OF NONPROFITS V. KIPPER

Fundamentally, Congress enacted the LRRA to increase

the supply of commercial liability insurance nationwide—not

to confer rights on individual RRGs. See H. R. Rep. No. 99-

865, at 7–8 (“The purpose of [the LRRA] is to facilitate the

formation and operation of risk retention groups and

purchasing groups.”) (“[The] creation of self-insurance

groups can provide much-needed new capacity.”); see also

Home Warranty Corp. v. Caldwell, 777 F.2d 1455, 1472

(11th Cir. 1985) (discussing purpose of the Product Liability

Risk Retention Act, predecessor to the LRRA). Thus,

Congress primarily enacted the LRRA to benefit buyers of

insurance, rather than the insurance companies themselves. 

Preemption of state laws directly effectuated that purpose,

because states had “created capital and other requirements

that ma[de] it difficult for [RRGs] to form or to operate on a

multi-state basis.” H. Rep. No. 99–865, at 8. Clearly, RRGs

stood to benefit from freedom from some state regulations. 

However, whatever salutary effect preemption had for

individual RRGs was only incidental to the ultimate purpose

of increasing the available supply of commercial liability

insurance. This sort of incidental benefit does not rise to the

level of the “unambiguously conferred” right that Gonzaga

University requires us to find. Gonzaga Univ., 536 U.S. at

283; see also Golden State, 493 U.S. at 109 (“[W]hen

congressional pre-emption benefits particular parties only as

an incident of the federal scheme of regulation, a private

damages remedy under § 1983 may not be available.”).

Our analysis of the first Blessing factor is sufficient to

determine that Congress did not intend to confer an

enforceable right on RRGs in the LRRA, so we will not

address the remaining two factors. Therefore, we conclude

that § 3902(a) of the LRRA does not confer on RRGs a right
ALLIANCE OF NONPROFITS V. KIPPER 23

to be free from state law that can be enforced under § 1983.13

As a result, the instant litigation ceases to be an “action . . . to

enforce a provision of [§ 1983],” eliminating the statutory

basis for an award of attorneys’ fees. See 42 U.S.C. § 1988. 

Accordingly, we vacate the fee award.

III. The district court did not commit reversible error

when it ruled on pending motions before the

deadline for filing a response had passed.

Finally, we must determine whether the district court

committed reversible error when it granted several motions in

alleged violation of its own local rule. “The rulings of the

district courts regarding local rules are reviewed for abuse of

discretion.” Prof’l Programs Grp. v. Dep’t of Commerce,

29 F.3d 1349, 1353 (9th Cir. 1994). “District judges must

adhere to their court’s local rules, which have the force of

federal law.” In re Corrinet, 645 F.3d 1141, 1146 (9th Cir.

2011). However, only “a departure from local rules that

affects ‘substantial rights’ requires reversal.” Prof’l

Programs Grp., 29 F.3d at 1353; Fed. R. Civ. P. 61.

Conversely, a departure should not be reversed “if the effect

is so slight and unimportant that the sensible treatment is to

overlook it.” Id. (internal quotation marks and alteration

omitted).

13 Supporting our conclusion, courts have repeatedly declined to

recognize that preemption provisions give rise to a non-specific right to be

free from state law that can be enforced under § 1983. E.g., Sprint

Telephony PCS, L.P. v. Cnty. of San Diego, 490 F.3d 700 (9th Cir. 2007)

(Telecommunications Act, 47 U.S.C. § 253(a)); Loyal Tire &AutoCenter,

Inc. v. Town of Woodsbury, 445 F.3d 136, 150 (2d Cir. 2006) (Interstate

Commerce Act, 49 U.S.C. § 14501(c)(1)); Wachovia Bank, N.A. v. Burke,

414 F.3d 305, 323 (2d Cir. 2005) (National Banking Act, 12 U.S.C. § 21

et seq.).
24 ALLIANCE OF NONPROFITS V. KIPPER

Here, the relevant local rule states, “Unless otherwise

ordered by the court, points and authorities in response shall

be filed and served by an opposing party fifteen (15) days

after service of the motion.” D. Nev. R. 7-2(b) (2006). The

Commissioner argues that the district court violated this rule

when it granted three different motions in this case.

First, we address two motions for leave to submit amicus

briefs filed by the NRRA and the Self-Insurance Institute of

America on January 31, 2011. The district court granted

these motions nine days later, on February 9, 2011, before the

Commissioner submitted a response. The district court did

not err by ruling on these motions at that time. Under its

plain language, Local Rule 7-2(b) does not guarantee parties

a period of time to file a response. Rather, it limits the period

in which a response may be filed to fifteen days. Moreover,

assuming that the district court did violate Local Rule 7-2(b),

neither motion raised issues that affected the Commissioner’s

substantial rights. The Commissioner does not articulate how

the admission of two additional amici affected the outcome

of the district court proceeding; he only argues that he was

denied his chance to file an opposition to their admission.

Second, we address ANI’s March 21, 2011 motion

seeking leave to supplement a previously filed reply. The

Commissioner filed a response on March 23, 2011, but the

district court granted ANI’s motion on March 24, 2011

without acknowledging the Commissioner’s response. The

Commissioner does not allege how the district court’s failure

to consider his response affected any substantial rights. 

Instead, he argues that he was “forced to file a motion asking

the District Court to ‘re-consider’ arguments never even

considered.” However, enduring the process of filing an

additional motion does not, by itself, affect the outcome of
ALLIANCE OF NONPROFITS V. KIPPER 25

the proceeding. Further, in this instance, the outcome clearly

was not affected. After the district court granted ANI’s

motion, the Commissioner filed a motion for reconsideration. 

In that motion, the Commissioner re-submitted the response

that the district court allegedly overlooked the first time. 

Considering the response explicitly when ruling on the

motion for reconsideration, the district court reached the same

conclusion. Thus, the district court’s failure to consider the

Commissioner’s response in the first instance did not affect

the outcome of ANI’s motion, or the litigation.

The district court’s errors—if any—did not affect the

Commissioner’s substantial rights. Rather, they seem

“slight” and “unimportant,” and we think the “sensible

treatment” is to overlook them. Prof’l Programs Grp.,

29 F.3d at 1353.

CONCLUSION

The Commissioner’s Order, which barred ANI from

writing first dollar liability insurance policies in Nevada, is

preempted by the LRRA, 15 U.S.C. § 3902(a). Therefore, we

AFFIRM the district court’s entry of declaratory and

injunctive relief. However, the LRRA does not confer a right

to be free from state law that can be enforced under 42 U.S.C.

§ 1983, making fees under 42 U.S.C. § 1988 unavailable. 

Therefore, we VACATE the fee award.
26 ALLIANCE OF NONPROFITS V. KIPPER

Finally, we REMAND so that the district court can enter

a new summary judgment order consistent with this opinion. 

The parties shall bear their own costs on appeal. See Fed. R.

App. P. 39(a)(4).

AFFIRMED in part, VACATED in part, and

REMANDED.