Court Opinion

ID: 161714
Source: CourtListenerOpinion
Date Created: 2010-08-14 07:16:25+00
Date Added: 2024-06-11T17:16:33.449306
License: Public Domain

F I L E D
                                                       United States Court of Appeals
                                                               Tenth Circuit
                 UNITED STATES COURT OF APPEALS
                                                                 NOV 5 2001
                         FOR THE TENTH CIRCUIT
                                                         PATRICK FISHER
                                                                   Clerk

TRANS SHUTTLE, INC., a Colorado
corporation; JEJAW GOSHU,
individually and doing business as
Hallelujah Shuttle; GEBERMICHAEL
YESHIGETA, individually and doing
business as Ethio Shuttle,

            Plaintiffs - Appellants,

and

GETACHEW M. KASSA, individually
and doing business as Galaxy Shuttle,

            Plaintiff,                        No. 01-1025
                                          (D.C. No. 00-K-1458)
v.                                              (D. Colo.)

THE PUBLIC UTILITIES
COMMISSION OF THE STATE OF
COLORADO; CITY AND COUNTY
OF DENVER, by and through BRUCE
BAUMGARTNER as Manager of
Aviation; DENVER SHUTTLE,
L.L.C., a Colorado Limited Liability
Company; SHUTTLE ASSOCIATES,
LLC, a Colorado Limited Liability
Company,

            Defendants-Appellees.
                            ORDER AND JUDGMENT           *

Before HENRY , PORFILIO , and MURPHY , Circuit Judges.

       After examining the briefs and appellate record, this panel has determined

unanimously that oral argument would not materially assist the determination of

this appeal.   See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is

therefore ordered submitted without oral argument.

                                      I. FACTS

       Appellant businesses and their officers (the shuttle operators) operate

separate and independent airport shuttle services, offering ground transportation

to and from Denver International Airport (DIA). They do so without a permit

from the Colorado Public Utilities Commission (PUC), which regulates intrastate

commercial motor carriers within the state. Each shuttle operator instead holds a

certificate from the Federal Highway Administration, an arm of the United States

Department of Transportation, authorizing it to transport passengers along certain

interstate routes (e.g., between Cheyenne, Wyoming, and DIA, and between

*
      This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.

                                          -2-
Santa Fe, New Mexico, and DIA). Each certificate allows a shuttle operator to

conduct limited intrastate shuttle services, but “only if the carrier also provides

substantial regularly scheduled interstate passenger transportation service on the

same route.” See, e.g., Aplt’s App. at 30, “Department of Transportation Office

of Motor Carrier Safety Certificate” of Plaintiff Trans Shuttle, Inc. (emphasis

added).

      PUC issued a series of penalty notices against the shuttle operators,

contending they were conducting extensive intrastate operations without

providing the necessary interstate service. PUC administrative law judges

presided over a number of penalty proceedings against the shuttle operators, each

time finding that a violation occurred, each time assessing a civil penalty. PUC

has fined the shuttle operators a total of approximately $8,000 and continues to

pursue new penalty assessments during the pendency of this appeal. Aplt’s

Motion for Writ of Prohibition or Mandamus at pp. 4-5. Furthermore, PUC

notified DIA officials about the shuttle operators’ violations, prompting the

airport to begin the process of revoking their access to Level 5 at the terminal,

which is reserved for commercial motor carriers.

      For the most part, the shuttle operators did not challenge the evidence

presented by PUC investigators and lawyers at the various administrative

hearings. Instead they insisted that PUC has no regulatory authority over any of

                                          -3-
their operations, including their intrastate operations, because their federal

permits preempt such state authority. The shuttle operators claimed that only the

Federal Highway Administration can penalize them for violating the terms of

their federal permits. 1

       Having had no success in the PUC administrative proceedings, the shuttle

operators exercised their statutory right to seek review of the agency’s actions in

the state district court. See Exhibit E, “Complaint Under Rule 106 C.R.C.P,” and

unidentified exhibit entitled “Combined Application for Writ of Certiorari or

Review Under C.R.S. § 40-6-115(1) and Complaint Under Rule 106 C.R.C.P,”

both attached to Aplt’s Br. While this review was pending in state court, the

shuttle operators filed suit under 42 U.S.C. § 1983 in federal district court

against PUC and DIA, seeking an injunction to bar PUC’s regulatory authority

over their operations and to enjoin further access revocation proceedings by

DIA. 2 In addition to asserting their federal preemption claim, they alleged that

PUC and DIA targeted them because their officers and principals are ethnic

minorities. The shuttle operators sought to enjoin what they claim is a racially

1
      In addition to the Supremacy Clause, U.S. Const. art. 6, § 2, the shuttle
operators rest their preemption claim on two sources: 1) the Commerce Clause,
U.S. Const. art. 1, § 8, cl. 3; and 2) 49 U.S.C. § 14501(a), which addresses the
scope of state authority to regulate certain motor carriers traveling on interstate
routes.
2
       The state court review of PUC’s penalty assessments is still pending.

                                         -4-
motivated deprivation of their constitutional right to engage in interstate

commerce.

      Still seeking only injunctive and declaratory relief, the shuttle operators

also named Denver Shuttle L.L.C. as a defendant in this federal suit. Denver

Shuttle, also known as Super Shuttle, operates an airport shuttle service under a

valid PUC permit. The shuttle operators alleged that defendant Super Shuttle

illegally interfered with their businesses, a contention that rests in part on an

earlier lawsuit filed by Super Shuttle against one of the shuttle operators,

Hallelujah Shuttle. Acting as a private attorney general, Super Shuttle sued

Hallelujah Shuttle in state district court, alleging that Hallelujah was operating a

commercial shuttle service without a valid permit from PUC.

      The shuttle operators sought a temporary restraining order in connection

with their federal lawsuit. The district court denied the request, finding it

unlikely that they would prevail on the merits. PUC then filed a motion, joined

by DIA, to dismiss the amended complaint, raising both Eleventh Amendment

immunity and Younger abstention. See Younger v. Harris, 401 U.S. 37 (1971)

and Middlesex County Ethics Comm. v. Garden State Bar Ass’n        , 457 U.S. 423

(1982) (defining federal abstention pending resolution of state criminal, civil, or

administrative proceedings). The district court granted the motion on abstention

                                          -5-
grounds. Because it declined to exercise jurisdiction, the district court dismissed

the case with respect to all defendants. The shuttle operators appeal. We affirm.

                                II. JURISDICTION

      Under circuit precedent, PUC’s claim of Eleventh Amendment immunity

challenged the subject matter jurisdiction of the district court. Thompson v.

Colorado, 258 F.3d 1241, 1245 (10th Cir. 2001). Generally, a court must resolve

concerns regarding its jurisdiction before it may address the merits of a case.

Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 101-02 (1998) (rejecting the

doctrine of hypothetical jurisdiction).

      Although the district court decided the abstention question without

addressing PUC’s immunity claim, it did not run afoul of the rule announced in

Steel Co., which specifically indicated that a court can dismiss under the Younger

doctrine without resolving doubts about its subject matter jurisdiction. Id. at 100

n.3 (approving dismissal under Younger without first determining whether there

is a case or controversy). The Court later verified the propriety of abstention

under Younger “without deciding whether the parties present a case or

controversy.” Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 585 (1999)

(citation omitted).

                                          -6-
      Because we resolve that the district court properly invoked the Younger

doctrine to dismiss the amended complaint, this court need not address PUC’s

assertion of Eleventh Amendment immunity.

                          III. YOUNGER ABSTENTION

      The district court’s abstention under Younger is subject to de novo review.

Amanatullah v. Colo. Bd. of Med. Exam’rs, 187 F.3d 1160, 1163

(10th Cir. 1999). Under Younger and its progeny, “federal courts should not

interfere with state court proceedings by granting equitable relief–such as

injunctions of important state proceedings or declaratory judgments regarding

constitutional issues in those proceedings–when a state forum provides an

adequate avenue for relief.” Joseph A. ex rel Wolfe v. Ingram, __ F.3 __,

No. 00-2136, 2001 WL 951352, at *9 (10th Cir. Aug. 22, 2001) (quotation

omitted). O ne of the fundamental policies underlying the   Younger doctrine is the

recognition that state courts are fully competent to decide federal constitutional

questions. Middlesex County Ethics Comm. , 457 U.S. at 431.

      Younger requires a federal court to abstain from exercising jurisdiction

when: (1) there is an ongoing state criminal, civil, or administrative proceeding,

(2) the state court provides an adequate forum to hear the claims raised in the

federal complaint, and (3) the state proceedings involve important state interests

or policies. Amanatullah, 187 F.3d at 1163. “Younger abstention is

                                          -7-
non-discretionary; it must be invoked once the three conditions are met, absent

extraordinary circumstances.” Id. All of the elements of Younger are present

here.

A.      Ongoing State Proceedings

        The shuttle operators do not contest the first element, conceding the

existence of ongoing state civil and administrative proceedings.

B.      Adequacy of State Forum

        The shuttle operators contend that the state forum is inadequate and offer

three arguments.

        1.    Ability to Raise Preemption Claim

        Initially, the shuttle operators claim that the state proceedings are limited in

scope and therefore do not offer a suitable forum in which to raise their federal

constitutional claims.

        The Supreme Court has stated that     Younger principles apply when there are

extant state administrative proceedings “in which important state interests are

vindicated, so long as in the course of those proceedings the federal plaintiff

would have a full and fair opportunity to litigate his constitutional claim.”    Ohio

Civil Rights Comm’n v. Dayton Christian Sch., Inc.        , 477 U.S. 619, 627 (1986).

Crucial to what the Court would regard as such a full and fair opportunity is the

presence of state court review: “[I]t is sufficient [for purposes of invoking

                                             -8-
Younger ] that constitutional claims may be raised in state-court judicial review of

the administrative proceeding.”    Id. at 629.

       Here the shuttle operators raised, and a state ALJ addressed, the federal

preemption claim in each of the administrative hearings before the PUC.       See

Recommended Decision(s) Assessing Civil Penalty; Aplt’s App. at 102-10; 121-

30; 151-56. Moreover, Colorado law specifically allows this and other

constitutional claims, including the shuttle operators’ civil rights claims, to be

asserted and reviewed in the state district court. Colo. Rev. Stat. § 40-6-115(2).

Indeed, with respect to “any proceeding wherein the validity of any order or

decision is challenged on the ground that it violates . . . the constitution of the

United States,” the state court is required to “exercise an independent judgment

on the law and the facts.”   Id. Colorado law further provides for appellate review

of the state district court’s decision by the Colorado Supreme Court.     Id. at § 40-

6-115(5).

       We conclude that Colorado provides suitable fora by which the shuttle

operators may obtain a remedy for their alleged constitutional violation. The

shuttle operators not only were able to litigate their preemption claim before the

PUC, they are entitled to and have sought an independent state court review of the

agency’s decision.   Younger requires nothing more.      See, e.g., Middlesex County

Ethics Comm., 457 U.S. at 435-37 (holding that federal courts should not

                                            -9-
interfere with pending attorney disciplinary actions if state procedures allow an

attorney the opportunity to raise constitutional challenges to the proceedings);

Erwin Chemerinsky, Federal Jurisdiction , § 13.4 at 810-11 (3d ed. 1999) (       “Thus,

state proceedings will be deemed inadequate if either impermissible bias is shown

or if there is no available state remedy. Such findings, however, are likely to be

very rare.” ). 3

       2.      Availability of Relief Against All Parties

       The shuttle operators next assert that the state forum is inadequate because

it does not involve DIA or Super Shuttle, both of which are named as defendants

in the federal lawsuit.   4
                              They refer only to their consolidated state court review of

3
       The shuttle operators do not allege bias on the part of the state courts.
However, invoking a recognized exception to      Younger , they do allege bad faith by
PUC and the other defendants, insofar as the “concerted activities of the
Defendants were done in such a way as to constitute harassment or abuse of
authority . . . .” Aplt’s Br. at 16. Before this court can consider a claimed bad
faith exception to Younger , the shuttle operators must “set[]forth more than mere
allegations of bad faith or harassment.”   Amanatullah , 187 F.3d at 1165
(quotation omitted). The shuttle operators have not met this burden.
4
       The shuttle operators filed a motion in the district court seeking to amend
their complaint (a second time) to add individual PUC commissioners as
defendants. The district court denied that request when it granted PUC’s motion
to dismiss on Younger grounds. In a single sentence unsupported by authority or
argument, buried in their opening brief, the shuttle firms “note” that “the Trial
Court should have granted Plaintiffs’ Motion to Amend to name the individual
commissioners of the PUC as parties Defendant [sic].” Aplt’s Br. at 17-18.         The
shuttle operators’ cursory reference to the district court’s failure to permit
amendment is insufficient to preserve the issue for appellate review. See United
States v. Kunzman, 54 F.3d 1522, 1534 (10th Cir. 1995) (appellant must present
                                                                           (continued...)

                                             -10-
PUC’s penalty assessments, however. They overlook separate, though intimately

related, state court or administrative proceedings that do indeed involve DIA and

Super Shuttle.

      DIA is obviously a party to the very administrative proceedings it

commenced against the shuttle operators to revoke their access to that portion of

the airport terminal reserved for commercial carriers. DIA initiated those

proceedings when it received notice from PUC that the shuttle operators were

violating state law by providing transportation services without a valid state

permit. Furthermore, Super Shuttle is obviously a party in the state court action it

brought against Hallelujah Shuttle, one of the plaintiff shuttle operators, alleging

that Hallelujah Shuttle was similarly violating state law by operating without a

valid PUC permit. Acknowledging an even more pervasive presence of Super

Shuttle, the shuttle operators alleged in their federal court amended complaint that

“there is a substantial likelihood” that Super Shuttle will bring similar actions in

state court against the remaining shuttle operators. Aplt’s App. at 19, Amended

Complaint, para. 48.

      DIA officials have agreed to postpone the threatened revocation hearings

until the legal issues surrounding the PUC penalty assessments are resolved. The

4
 (...continued)
reasoned arguments addressing grounds for appeal).

                                         -11-
shuttle operators continue to enjoy access to Level 5 during the pendency of the

administrative proceedings. Answer Brief of City of Denver at p. 3. If and when

those proceedings resume, the shuttle operators do not suggest that they will be

unable to press their underlying preemption claim before the administrative

hearing officer. In the event DIA does in fact revoke their access to Level 5, the

shuttle firms may seek judicial review and raise their constitutional claim of

preemption under Colo. R. Civ. P. 106(a)(4), which allows for a state district

court to grant relief when any governmental body “exercising judicial or

quasi-judicial functions has exceeded its jurisdiction or abused its discretion.”

The Colorado Supreme Court, moreover, has held that an aggrieved party may

bring a constitutional challenge against the relevant governmental body in any

proceeding under Colo. R. Civ. P. 106(a)(4).     Tri-State Generation &

Transmission Co. v. City of Thornton   , 647 P.2d 670, 676 n.7 (Colo. 1982).

Likewise, the shuttle operators do not deny that they can raise their constitutional

claim in any current or future state court action brought by Super Shuttle.

      The shuttle operators are thus free to litigate their preemption challenge in

the state proceedings against both DIA and Super Shuttle. As a result, we

conclude that the pending state court review of PUC’s penalty assessments, in

conjunction with the related proceedings involving DIA and Super Shuttle,

                                          -12-
embrace and encompass all parties to and all issues in the shuttle operators’

federal lawsuit.

       3.     Jurisdiction of State Court

       Finally, the shuttle operators attack the adequacy of the state court fora by

insisting that the state court lacks jurisdiction “to determine the Plaintiffs’

compliance with federal law and their Federal licenses.” Aplt’s Br. at 12. This

argument differs not at all from those addressed above, i.e., the shuttle operators’

contention that the state fora are inadequate to address defenses based on federal

constitutional principles. It is clear that the state courts have jurisdiction to

resolve the shuttle operators’ constitutional defenses. Indeed, as we stated above,

Colorado law specifically authorizes the state district courts to address federal

constitutional claims, and the   Younger doctrine is founded on the principle that

state courts are no less capable of interpreting the federal constitution than are

federal courts.

C.     Importance of State Interests

       The third Younger factor, the importance of the relevant state interests, is

prevalent. PUC is charged with regulating intrastate motor carriers; its purpose is

to protect the health and safety of its citizens who ride with these carriers and

who share the roads with them.     See Colo. Rev. Stat. § 40-10-102 (charging PUC

to regulate motor carriers and declaring them “to be affected with a public

                                            -13-
interest”). The PUC charge involves an important state interest.    See Skinner v.

Ry. Labor Executives’ Ass’n, 489 U.S. 602, 620 (1989) (holding that Fourth

Amendment rights were outweighed by compelling government interest in

protecting safety of railway passengers).

      The shuttle operators deny the importance of this asserted interest by

focusing on the merits of their preemption claim. They accept PUC’s regulatory

authority over intrastate carriers, but claim PUC can have no valid interest in

regulating federal permittees. This argument does no more than restate the

central controversy. It is not so much an argument against the importance of the

state’s interests as it is a conclusion drawn from an earlier assumption that the

shuttle firms are exempt from state regulation, an assumption that is under attack

from PUC and is currently being litigated in state court. It is, in any event, a

hollow response to what is a valid and important state interest.

                IV. DISMISSAL OF DIA AND SUPER SHUTTLE

      The shuttle firms contend that even if the district court properly invoked

Younger abstention with respect to PUC, it was error to dismiss the entire

lawsuit. The shuttle firms urge this court to reinstate their claims against DIA

and Super Shuttle. We decline.

      As discussed above, all three co-defendants named in the shuttle firms’

federal suit have initiated some state court or state administrative action against

                                           -14-
one or all of the firms. In all three fora, the parties present the same legal issue,

the extent of PUC’s ability to regulate a federally permitted motor carrier. All

three cases involve the same general public policy, protecting the health and

safety of passengers and highway travelers. The three Younger factors, ongoing

state proceedings, adequate forum to raise constitutional claim, and an important

state interest, are extant. Moreover, if abstention is required with respect to

PUC, as we have ruled, abstention is equally required with respect to DIA and

Super Shuttle.

      The judgment of the United States District Court for the District of

Colorado is AFFIRMED. The shuttle operators’ motion for writ of prohibition or

mandamus is DENIED as moot.      5

                                                      Entered for the Court

                                                      Michael R. Murphy
                                                      Circuit Judge

5
       We also DENY the joint motion to intervene filed by Colorado Express,
Mo’s Express, and Mozammel H. Tipu individually and doing business as Angel’s
Transportation. The motion is both untimely and unwarranted.       See Fed. R. App.
P. 15(d) (requiring that motion to intervene “must be filed within 30 days after”
the appeal is filed) and Hutchinson v. Pfeil, 211 F.3d 515, 519 (10th Cir.) (stating
that intervention at appellate stage is permissible in an “exceptional” case and for
“imperative reasons”), cert. denied, 531 U.S. 959 (2000). Additionally, the
proposed interveners’ motions to strike responses filed by DIA are DENIED as
moot.

                                          -15-