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THE SUPREME COURT OF NEW HAMPSHIRE

___________________________

9 th Circuit C ourt

- Manchester District Division

No. 2013

- 796

THE STATE OF NEW HAMPSHIRE

v.

WAYNE A. BICKFORD & a

.

Argued: October 9, 2014 Opinion Issued: May 1 9 , 2015

Joseph A. Foster , attorney general ( Lisa L. Wolford

, assistant attorney

general , on the brief and orally), for the State.

Brennan, Caron, Lenehan & Iacopino , of Manchester

, ( Michael J.

Iacopino and Jenna M. Be r geron on the brief , and Mr. Iacopino orally ) , for the

defendant s

.

HICKS , J. The defendants, Gerald Mandelbaum, Christopher La j oie, Nicholas Meuse, Michael Gar r ity, and Wayne Bickford, were charged with operating a taxicab business without a license from the City of Manchester (City)

. The Circuit C ourt ( Michael , J.) granted the defendants’ motion to

dismiss on federal preemption grounds

. See 49 U.S.C. §§ 14501(a), (d) (2012). The State appeals, arguing that the local ordinances are not preempted by2

federal law and that the c ircuit c ourt has jurisdiction over the charges. We

reverse and remand.

The following facts are supported by the record or undisputed by the parties. Mandelbaum owns Amoskeag Airport Service (AAS), a sole proprietorship in Manchester, and Amoskeag Black Car (ABC), a registered

trade name for a subdivision of AAS. Mandelbaum operates these business es pursuant to a motor carrier permit issued by the United States Department of Transportation’s Federal Motor Carrier Safety Administration (FMCSA) that

, he

asserts

, grants him the authority “to engage in the transportation as a com mon carrier of passengers, in charter and special operations, by motor vehicle in interstate or foreign commerce.” Mandelbaum does not, however, hold a City license to operate a taxicab s ervice

.

Bickford, Garrity, Lajoie, and Meuse are drivers for AAS a nd ABC. In March and April of 2013, they were each cited by the Manchester Police for operating a taxicab service in violation of the City ’s business and taxicab licensing ordinances ( City Ordinances)

. See Manchester, N.H., Rev.

Ordinances title XI, ch. 110, § 110.02; id . title XI, ch. 118, §§ 118.01 et seq

. (2014 )

. On two occasions, Mandelbaum was also issued a citation for the same

reasons.

On July 8, 2013, the defendants mo ved to dismiss the citations

, arguin g that : (1) federal law preempt s the City Ordinances ; (2) Mandelbaum’s FMCSA

certification d ivests the City of jurisdiction to regulate AAS or ABC; and (3)

neither AAS n or ABC constitute s a taxicab service as defined by statute or

o rdinance. The State objected and

, a fter a hearing, t he trial cou rt granted the defendants’ motion to dismiss “without prejudice to the State’s right to petition

the FMCSA for further review of the defendants’ activities.” The State filed a motion to reconsider, which was denied. This appeal followed.

Although the p arties raise numerous issues, we need only address the following : (1) whether federal law preempt s the City Ordinances ; and ( 2 )

whether federal law requires the State to first bring its complaints before the

FMCSA

. Because resolution of these issue s requires both statutory interpretation and a determination of federal preemption, we review the trial

court’s decision de novo

. Appeal of Bretton Wood s Tel. Co. , 164 N.H. 379, 3 86

- 87 (2012); State v. Merriam , 150 N.H. 548, 549 (2004). When interpreting a statute, we first look to the language of the statute itself, and, if possible, construe that language according to its plain and ordinary meaning. Pelkey v. Dan’s City Used Cars , 163 N.H. 483, 487 (2012), aff’d , 133 S. Ct. 1769 (2013).

We do not read words or phrases in isolation, but in the context of the entire statutory scheme. Id

. When construing federal statutes, we construe them in accordance with federal policy and precedent. Id

.3

We first consider whether federal law preempts the City Ord inances.

State and local laws are preempted when : “(1) Congress expresses an intent to displace state law; (2) Congress implicitly supplants state law by granting exclusive regulatory power in a particular field to the federal government; or (3) state and federal law actually conflict.” Disabilities Rights C en t e r, Inc. v.
Comm’r

, N

. H

. D ept

. of Corr ections , 143 N.H. 674, 676 (1999). The federal preemption doctrine is based upon the Supremacy Clause of the United States

Constitution. U.S. C ONST

. a rt. VI , cl. 2 ; Arizona v. United States , 132 S. Ct. 2492, 2500 (2012); Appeal of Sinclair Ma chine Prod’s, Inc. , 126 N.H. 822, 826 (1985). “Consideration of issues arising under the Supremacy Clause starts with the assumption that the historic police powers of the States are not to be superseded by Federal Act unless that is the clear and manifes t purpose of Congress.” Cipollone v. Liggett Group, Inc. , 505 U.S. 504, 516 (1992) (quotation, brackets, and ellipsis omitted). “Accordingly, the purpose of Congress is the ultimate touchstone of pre

- emption analysis.” Id . (quotation

and brackets omitte d).

The defendants do not argue that Congress expressly displaced s tate law by enacting 49 U.S.C. §§ 14501(a) and 14501(d) . Instead

, they argue that

enforcement of the City Ordinances against them brings state and federal law into conflict, and that whe n such conflict occurs state law must yield

. Specifically, they contend that “[f]ederal law clearly exempts taxicab services from FMCSA regulation” and that “Mandelbaum’s business cannot be licensed both under the FMCSA Certificate and local Manchester, NH taxicab

ordinances

. ” W e dis agree.

W e first examine the federal statutory scheme upo n which the defendants rely

. Title 49 U.S.C. § § 13101 et seq

. (2012) govern the federal regulation of interstate transportation provided by motor carriers, water carriers, brokers, and freight forwarders, and seek “[t]o ensure the development, coordinatio n, and preservation of a transportation system that meets the transportation needs of the United State s.” 49 U.S.C. § 13101(a) . In overseeing the transportation of motor carriers of passengers

, the federal government endeavors “to cooperate with the Stat es on transportation matters for the purpose of encouraging the States to exercise intrastate regulatory jurisdiction in accordance with the objectives of [49 U.S.C. §§ 13101

- 14916] .”

Id . § 13101(a)(3)(A). To achieve these goals, Congress has vested the Secretary of Transportation ( Secretary ) and the Surface Transportation Board (STB) with jurisdiction “over transportation by motor carrier and the procurement of tha t transportation, to the extent that passengers . . . are transported by motor

carrier” fro m one state to another or within a single state as long as the transportation , in relevant part, crosses into another state. Id . § 13501(1 ). Congress has directed the FMCSA to carry out the “duties and powers related

to motor carriers or motor carrier sa fety vested in the Secretary by” the statutes

here at issue. Id . § 113(f) (2012).4

Congress , however, explicitly denied the federal government jurisdiction over “a motor vehicle providing taxicab service.” Id . § 13506(a)(2). Congress

has defined taxicab service to mean:

[P]assenger transportation in a motor vehicle having a capacity of not more than 8 passengers (including the driver), not operated on a regular route or between specified places, and that

–

(A) is licensed as a taxicab by a State or local jurisdiction; or

(B) is offered by a person that

–

(i) provides local transportation for a fare determined (except with respect to transportation to or from airports) primarily on the basis of the distance traveled; and

(ii) does not primarily provide transportation to or from airports.

Id . § 13102(22).

Federal law displaces the s tates’ ability to regulate the “scheduling of interstate or intrastate transportation . . . provided by a motor carrier of

passengers . . . on an interstate route ” and to regulate “the implementation of any change in rates for such transportation . . . except to the extent that notice . . . of changes in schedules may be required” for motor carriers subject to the Secretary’s or the STB’s jurisdiction. Id . § 14501(a ) (emphasis added)

. It also displaces the s tates’ ability to enforce any law or regulation requiring a license

or imposing a fee on motor vehicles providing pre

- arranged ground transportation service if such service is within the jurisdiction of the Secre tary

or the STB , “meets all applicable vehicle and intrastate passenger licensing requirements of the S tate or S tates in which the motor carrier is domiciled or registered to do business,” and is provid ed pursuant to a contract for transportation from one s tate to a destination in another s tate or within a single s tate but with an intermediate stop in another s tate. Id . § 14501(d) ; Black Car Assistance Corp. v. New Jersey , 351 F. Supp. 2d 284, 289 (D.N.J. 2004) ( holding that 49 U.S.C. § 14501(d) prohibits enforcing licensing or fee requirements against non

- resident providers of prearranged ground transportation provided they satisfy the requirements of § 14501(d) ); S. Rep.

No. 107

- 237, at 1 (2002) (“ The purpose of this bill . . . is to prohibit a State, . .

. other than the home licensing State , from enacting or enforcing any law, rule, or regulation requiring a license or fee on a motor vehicle that is providing prearranged interstate ground transportation service

. ” (emphasis added ) )

. Here, again, the fede ral law explicitly exempts taxi services from the jurisdiction of the Secretary

. 49 U.S.C. § 14501(d)(3)(A). Federal law also establishes the process that motor carriers must follow to register with the5

Secretary and the FMCSA

, if they wish to provide interstate transportation

services

. Id . § 13901(a); 49 C.F.R. § 385.301 (a) (201 4 )

.

The plain language of the se statutes requires a motor carrier engag ing in interstate commerce or transit to be within the jurisdiction of the Secretary

and , thus, the FMCSA ; purely intrastate activities are left to s tate and local

authorities to regulat e

. See Leonard Exp ress , Inc. v. United States , 298 F. Supp. 556, 560 (W.D. Pa. 1969) (recognizing that a motor carrier cannot rely on

its federal certification to avoid complia nce with s tate law when conducting purely intrastate activities )

. Furthermore, C ongress explicitly exempt s taxicab services from any federal jurisdiction. 49 U.S.C. §§ 13506(a)(2), 14501(d)(3)(A). The exemption recognizes that taxicab services ar e inherently local in nature.

See Buck v. California , 343 U.S. 99, 102 (1952) (“The operation of taxicabs is a local business. For that reason Congress has left the field largely to the states.”) ; I.C.C. v. Miller , 360 F. Supp. 1167, 1170

- 71 (D.N.H. 1973 ) (finding

that federal law generally exempts taxicab service s from federal regulation and that “bona fide taxicab service” constitutes local transportation) . Accordingly, we conclude that federal law neither expressly nor implicitly preempts the City

Ord inances.

Nevertheless, when an actual conflict arises between state or local law and federal law, state or local law is without effect to the extent that it conflict s with federal law. Fidelity Federal Sav. & Loan Assn v. De La Cuesta

, 458 U.S. 141, 153 (1982). “An actual conflict exists when it is impossible for a private party to comply with both state and federal requirements or where state law stands as an obstacle to the accomplishments and execution of the full purpose and objective of Congress.” Disabilities Rights Center , 143 N.H. at 678 (quotation omitted). A motor carrier that provides taxicab service under a s tate
or local license would, generally

, be exempt from federal regulation . 49 U.S.C. § 13506 (a)(2) (exempting taxicab services from f ederal jurisdiction); 42 U.S.C. § 13902 ( detailing how to register as a motor carrier subject to federal jurisdiction). This exemption, however, is not without limits. See

, e.g. , I.C.C. v. Mr. B’s Services, L td

. , 934 F.2d 117, 122 (7th Cir. 1991)

. The taxicab services exemption does not extend to transportation provided by taxicabs that is not inherently local. Id

. Once the transportation ceases to be local in nature

or the provider bill s itself as an interstate service , it falls within the jurisd iction

of the Secretary , the STB, and the FMCSA

, and the provider must comply with federal law to provide such transportation. See i d .; see also Miller , 360 F. Supp. at 117 1 (concluding that a taxicab service cannot hold itself out as providing interstate transportation without securing the necessary licenses from the federal government). Accordingly, a taxicab service can be subject to local regulation and still fall within the jurisdiction of the FMCSA

.

Th us, the defendants ’ FMCSA certification provides them with the

a uthori ty to carry passengers in interstate commerce, but it does not authorize them to provide purely intrastate services that are unrelated to their interst ate6

services. See Funbus Systems, Inc. v. C.P.U.C. , 801 F.2d 1120, 11 22, 11 29 (9th Cir. 1986) ( concluding that certificate issued by Interstate Commerce

Commission to operate in interstate commerce grants a limited a uthori ty to operate along the same rout es in intrastate commerce but does not grant the

certificate holder free rein to operate wholly unrelated intrastate services); East West Resort Transp., LLC v. Binz , 494 F. Supp. 2d 1197, 1200 (D. Colo. 2007) ( noting that for intrastate transportation to qualify as interstate service subject to federal regulation, thereby preempting regulation by the state, it “may not operate independently of the interstate service , but instead must be conducted as part of existing interstate service” (quotation omitted) )

. Federal law and certification do not function as a shield to prevent the enforcement of local regulation when the nature of the service provided is intrastate and unrelated

to the interstate services protected under federal law. See Trans Shuttle v.

Pu blic Utilities Com’n , 89 P.3d 398, 400 n.3

, 404 (Colo. 2004) ( conclud ing that federal law preempts local regulatory authority only with respect to a motor
carrier’s intr a state passenger transportation on same routes over which it provides interstate transp ortation; intrastate activities that are independent of the interstate activities are subject to local regulation).

Because the defendants have not shown that they cannot comply with the requirements of both federal law and the City Ordinances , they have f ailed

to demonstrate that state and federal law actually conflict. See Disabilities Rights Center , 143 N.H. at 678. Accordingly , w e conclude that the trial court erred in dismissing the case

. I f the trial court concludes that the defendants’ transportation service falls within the scope of the City Ordinances, they must comply with the requirements of those ordinances. 1

Finally, the defendants assert that the determination “of whether their business activity falls within the authority grante d to them by their federal certificate requires the special competence of the issuing authority.” They
appear to argue that the primary jurisdiction doctrine justifies a stay of the court proceedings and a determination of the issue by the FMCSA in the fi rst

instance. See Reiter v. Cooper , 507 U.S. 258, 268 (1993) (noting that the primary jurisdiction doctrine requires a trial court “ to enable a ‘referral’ to the agency, staying further proceedings so as to give the parties reasonable opportunity to seek an administrative ruling

, ” particularly where the claim

“ contain [s] some issue within the special competence of an administrative agency” ). However , as the State points out, the City’s enforcement action does not “challenge the defendants’ compliance with their federal operating authority”; rather , t he dispositive issue here is whether the defendants’

activities constitute a taxicab service under the City Ordinances . Because this is not an issue within the special competence of the FMCSA , the primary jurisdiction doctrine is inapplicable.

1 Because we so conclude

, we need not address the defendants’ argument that the Manchester Ordinances unconstitutionally burden interstate commerce.7

For all of the foregoing reasons, we conclude that the trial court erred in

dismiss ing the State’s charges

.

Reversed and remanded

.

DA LIANIS , C

. J., and CONBOY, L YNN, and BASSETT, JJ., concurred.