Court Opinion

ID: 4153794
Source: CourtListenerOpinion
Date Created: 2017-03-18 00:00:50.769011+00
Date Added: 2024-06-11T07:46:36.358859
License: Public Domain

Case: 16-50115   Document: 00513916817     Page: 1   Date Filed: 03/17/2017

        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT
                                                                     United States Court of Appeals
                                                                              Fifth Circuit

                                 No. 16-50115                               FILED
                                                                       March 17, 2017
                                                                       Lyle W. Cayce
UNITED MOTORCOACH ASSOCIATION, INCORPORATED,                                Clerk

             Plaintiff - Appellant

v.

CITY OF AUSTIN,

             Defendant - Appellee

                Appeal from the United States District Court
                     for the Western District of Texas

Before DAVIS, DENNIS, and SOUTHWICK, Circuit Judges.
LESLIE H. SOUTHWICK, Circuit Judge:
      This appeal raises the issue of whether federal law preempts a city’s
exercise of regulatory authority over the intrastate operation of charter buses.
A national association of charter-bus companies sought to enjoin regulations
affecting their operations enacted by the City of Austin, Texas. The district
court held that the regulations were not preempted. We AFFIRM.

              FACTUAL AND PROCEDURAL BACKGROUND
      An Austin city ordinance regulates “charter bus service,” which it defines
as “transportation provided for compensation at the request of a third party for
the exclusive use of a vehicle with a capacity of at least sixteen
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persons . . . providing service originating, terminating and travelling solely
within the city limits.” AUSTIN CITY CODE § 13-2-1(1). Under the first set of
relevant regulations, the “permitting regulations,” operators of charter-bus
service must obtain a city permit, which requires them to submit an
application including various pieces of information as to the association
between the holder and its vehicles, the applicant’s criminal history, current
vehicle inspections and drivers’ licenses, and proof of valid federal or state
operating authority. Id. § 13-2-253.
      The permitting regulations also regulate charter-bus operations within
Austin. Matters covered include how passengers may be dropped off in relation
to the curb and what must be done if a bus breaks down. Id. §§ 13-2-270, 271.
Failure to comply with the permitting regulations can lead to revocation or
suspension of an operator’s permit. Id. § 13-2-263. The ordinance also contains
another set of regulations, the “decal regulations,” which require each operator
to display at all times a decal of its permit and, when relevant, a “special event
permit.” Id. § 13-2-267, 285.
      In 2013, United Motorcoach Association (“UMA”), a national association
of professional bus companies, filed this suit against the City seeking a
permanent injunction against both the permitting and the decal regulations.
It argued that the regulations are preempted by federal law. In March 2014,
the district court denied a preliminary injunction on any part of the regulations
except for two provisions that are not at issue in this appeal. After UMA
amended its complaint in early 2015, cross-motions for summary judgment
were filed in July.    In January 2016, the district court granted UMA a
permanent injunction as to the decal regulations but denied any further relief.
UMA’s appeal solely concerns the district court’s ruling denying relief as to the
permitting regulations. The City has not appealed.

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                                      DISCUSSION
       The arguments about preemption are based on a federal statute
captioned “Federal authority over intrastate transportation.” See 49 U.S.C.
§ 14501. It provides that States and their governmental subdivisions may not
enforce rules affecting interstate or intrastate transportation by a motor
carrier of passengers, with identified exceptions. Id. § 14501(a). There is much
more to the statute, and we will presently analyze the relevant parts.
       In determining a federal statute’s preemptive reach, congressional
purpose is “the ultimate touchstone.” Medtronic, Inc. v. Lohr, 518 U.S. 470,
485 (1996) (quotation marks omitted). “Evidence of pre-emptive purpose is
sought in the text and structure of the statute at issue,” and “in the first
instance [we] focus on the plain wording of the clause, which necessarily
contains the best evidence of Congress’ pre-emptive intent.” CSX Transp., Inc.
v. Easterwood, 507 U.S. 658, 664 (1993). Nonetheless, “we start 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.” City of Columbus v. Ours Garage & Wrecker Serv., Inc., 536 U.S.
424, 432 (2002) (quotation marks omitted). That means that when there is
“more than one plausible reading [of the text, we] ordinarily accept the reading
that disfavors pre-emption.” Altria Grp., Inc. v. Good, 555 U.S. 70, 77 (2008)
(quotation marks omitted).
       The preemption issue that remains in this suit arises from the district
court’s holding that a savings clause in the statute exempted the permitting
regulations from preemption. 1 We thus address only whether the permitting
regulations are preempted.

       1 On appeal, UMA argues for the first time that the district court should have enjoined
Austin City Code § 12-2-269, which requires charter-bus operators to maintain certain forms
of identification. UMA raised this latter argument for the first time in its response to the
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       The party seeking a permanent injunction must satisfy a four-part test:
it must show (1) success on the merits; (2) the failure to grant the injunction
will result in irreparable injury; (3) the injury outweighs any damage that the
injunction will cause the opposing party; and (4) the injunction will not
disserve the public interest. VRC LLC v. City of Dallas, 460 F.3d 607, 611 (5th
Cir. 2006). We start with the district court’s preemption rulings, which are
legal issues we review de novo. Id.
       The key sections of the statute at issue provide:
       (a) MOTOR CARRIERS OF PASSENGERS.—
       (1) LIMITATION ON STATE LAW.—No State or political subdivision
       thereof . . . shall enact or enforce any law, rule, regulation,
       standard, or other provision having the force and effect of law
       relating to— . . .
               (C) the authority to provide intrastate or interstate charter
              bus transportation.
       (2) MATTERS NOT COVERED.—Paragraph (1) shall not restrict the
       safety regulatory authority of a State with respect to motor
       vehicles, [among other things] . . . .

§ 14501(a). The parties agree the City’s permitting regulations fall within the
language of Section 14501(a)(1)(C) because such regulations relate to “the
authority to provide intrastate or interstate charter bus transportation.” Our
analysis is thus confined to whether Section 14501(a)(2) nonetheless applies to
save the regulations from preemption.
       UMA contends the permitting regulations do not qualify as an exercise
of the City’s 2 “safety regulatory authority” under Section 14501(a)(2) for two

City’s motion for summary judgment. “A claim which is not raised in the complaint but,
rather, is raised only in response to a motion for summary judgment is not properly before
the court.” Cutrera v. Bd. of Sup’rs of Louisiana State Univ., 429 F.3d 108, 113 (5th Cir.
2005). The argument has been forfeited.
       2That Austin is a municipality, not a “State,” makes no difference here. “Congress’
reference to the ‘regulatory authority of a State’ should be read to preserve, not preempt, the
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reasons. First, UMA argues Section 14501(a)(2)’s plain language indicates
that cities may not regulate charter-bus permitting even if such regulations
are responsive to safety. Second, UMA argues that, even if the City may
regulate charter-bus permits in some circumstances, it did not meet its burden
of showing the permitting regulations were genuinely responsive to safety. We
now address each argument.

 I.    Section 14501(a)(2)’s General Applicability
       We start with whether Section 14501(a)(2) applies to charter-bus
permitting generally. Although no court has addressed the scope of Section
14501(a)(2)’s safety exception, we do not write on a blank slate. Following the
Supreme Court’s opinion in Ours Garage, we have, along with other circuits,
interpreted language in Section 14501(c)(2)(A) 3 that is identical to the
language in Section 14501(a)(2). See VRC, 460 F.3d at 612; Cole v. City of
Dallas, 314 F.3d 730, 733–35 (5th Cir. 2002); see also Ours Garage, 536 U.S. at
432; California Tow Truck Ass’n v. City & Cnty. of San Francisco, 807 F.3d

traditional prerogative of the States to delegate their authority to their constituent parts.”
Ours Garage, 536 U.S. at 429. Under the Texas Constitution, home-rule cities such as Austin
“have all the powers of the state not inconsistent with the Constitution, the general laws, or
the city’s charter.” See Wasson Interests, Ltd. v. City of Jacksonville, 489 S.W.3d 427, 433 n.6
(Tex. 2016) (quotation marks omitted). UMA’s opening brief does not argue any specific
Texas law denying the City such authority. Any such argument is abandoned. See Edwards
v. Johnson, 209 F.3d 772, 775 n.1 (5th Cir. 2000).
       3 Section 14501(c)’s structure is parallel to Section 14501(a), in that it contains a
general preemption rule and an exception. Specifically, it provides:
      (c) MOTOR CARRIERS OF PROPERTY.—
      (1) GENERAL RULE.— . . . a State, political subdivision of a State, or political
      authority of 2 or more States may not enact or enforce a law, regulation, or
      another 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.
      (2) MATTERS NOT COVERED.—Paragraph (1)—
      (A) shall not restrict the safety regulatory authority of a State with respect to
      motor vehicles, [among other things] . . . .
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1008, 1020 (9th Cir. 2015).      The City argues we should interpret Section
14501(a)(2) with reference to Ours Garage and these subsequent opinions.
      In Ours Garage, the Supreme Court held that Section 14501(c)’s safety
exception applies to municipal as well as state tow-truck regulations. Ours
Garage, 536 U.S. at 431–32.        When discussing the exception, the Court
explained that through it “Congress’ clear purpose” was “to ensure that its
preemption of States’ economic authority over motor carriers of property,
§ 14501(c)(1), ‘not restrict’ the preexisting and traditional state police power
over safety.” Id. at 439. The Court did not then apply the exception to the
regulations at issue; it “express[ed] no opinion” on whether they qualified as
exercises of the city’s “safety regulatory authority.” Id. at 442. Instead, it
noted that question would turn on whether the regulations were “genuinely
responsive to safety concerns . . . .” Id.
      Later courts “applying the principles discussed in Ours Garage [have] on
the whole given a broad construction to the safety regulation exception.” VRC,
460 F.3d at 612; see also Houston Prof’l Towing Ass’n v. City of Houston, 812
F.3d 443, 449–51 (5th Cir. 2016); Cole, 314 F.3d at 734–35. This court has
rejected a searching standard “wherein the court inquires closely into the
legitimacy of the municipality’s safety concern and ensures that it is not a guise
for economic regulation.” VRC, 460 F.3d at 612–13. Instead, “we have looked
to statements of intent on the face of the ordinance, demonstrating that it was
designed to promote safety, as well as to evidence that there was a ‘nexus
between the ordinance and public safety.’” Houston Prof’l Towing Ass’n, 812
F.3d at 449 (alteration omitted) (quoting VRC, 460 F.3d at 614–15). In other
words, when applying Section 14501(c)’s safety exception, we have asked two
key questions: “(1) whether the ordinance evinced a safety purpose and (2)
whether it promotes safety.” Id. When engaging in this analysis, we have also

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considered the economic burden on those regulated by the ordinance. VRC,
460 F.3d at 615.
        Here, the district court concluded that “Ours Garage, California Tow
Truck     Association,   and   other    decisions    interpreting   and    applying
§ 14501(c)(2)(A) may appropriately be considered in interpreting and applying
§ 14501(a)(2), as both subsections use identical language.” We agree. Both
experience and common sense support the “natural presumption that identical
words used in different parts of the same act are intended to have the same
meaning.” See Atlantic Cleaners & Dyers, Inc. v. United States, 286 U.S. 427,
433 (1932). Sections 14501(a)(2) and (c)(2)(A) are not merely identical; they
inhabit the same section and mirror one another in structure and purpose.
Each limits the immediately preceding broad preemption clause, and in each
provision the text and context shows that “Congress’ clear purpose . . . is to
ensure that its preemption of States’ economic authority over motor
carriers . . . ‘not restrict’ the preexisting and traditional state police power over
safety.” See Ours Garage, 536 U.S. at 439 (quoting § 14501(c)(2)(A)).
        To convince us to deviate from this other caselaw, UMA argues the
savings clause cannot save the permitting regulations because they “relat[e]
to” the City’s authority to provide charter-bus transportation and are therefore
preempted under Section 14501(a)(1)(C).          UMA contends that the savings
clause is framed generally while the preemption clause is framed specifically,
so the specific preemption clause should prevail. True, when there is conflict
between two provisions, the ordinary rule is that a specific provision will
prevail over the general one. See Morton v. Mancari, 417 U.S. 535, 550–51
(1974). We find no conflict, though. Also, we think it incorrect to try to label
these as general and specific provisions. They work in tandem, such that the
savings clause clarifies that the preemption clause does not restrict the
traditional state police power over safety. See Ours Garage, 536 U.S. at 439.
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Finally, the savings clause does not swallow the preemption clause; each
retains effect. To interpret the savings clause so that it cannot save any
preempted rule, on the other hand, would violate “the elementary canon of
construction that a statute should be interpreted so as not to render one part
inoperative . . . .” See Mountain States Tel. & Tel. Co. v. Pueblo of Santa Ana,
472 U.S. 237, 249 (1985) (quotation marks omitted).
       Next, UMA attempts to distinguish the phrase “motor vehicles” (to which
the safety exception applies) from “carriers” (to which the financial-
responsibility exception 4 applies), seemingly suggesting that the disparate
usage means states may regulate only the safety of the vehicle and nothing
else. See § 14501(a)(2). The safety exception applies to the state’s authority
“with respect to motor vehicles,” while the financial-responsibility exception
applies to the state’s authority “to regulate carriers.” We agree, then, insofar
as UMA argues that such disparate usage requires different meanings for each
word — indeed, we heed “Congress’ decision to use different terms to describe
different categories of people or things.” See Mohamad v. Palestinian Auth.,
132 S. Ct. 1702, 1708 (2012).
       Yet UMA’s argued-for conclusion does not follow. “[S]afety regulatory
authority . . . with respect to motor vehicles” makes sense because charter-bus
vehicles (the motor vehicles) may present safety risks; “minimum amounts of
financial responsibility” as to “carriers” makes sense because charter-service
operators (the carriers) are the financially responsible parties. Grammatically,
“safety” modifies “regulatory authority,” not “motor vehicles.”                  Thus, the
provision’s language indicates that the referred-to authority is not merely as

       4   That exception, also within Section 14501(a)(2), reads: “Paragraph (1) shall not
restrict . . . the authority of a State to regulate carriers with regard to minimum amounts of
financial responsibility relating to insurance requirements and self-insurance authorization.”
§ 14501(a)(2) (emphasis added).
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to the mechanical safety of motor vehicles themselves; rather, it is the state’s
“safety regulatory authority” as such authority is applied to motor vehicles.
Such authority must include the type of permitting regulations we have
previously held to be covered by that phrase. See Cole, 314 F.3d at 734–35.
The interpretation we now adopt permits these terms to retain their distinct,
natural meanings. 5
       We also disagree with UMA’s argument that charter-bus permitting is
not a “preexisting and traditional state police power” because cities only
recently began regulating charter buses through permitting schemes. See
Ours Garage, 536 U.S. at 439.              Whether or not the regulatory history
surrounding charter-bus permitting regulations qualifies them as “preexisting
and traditional,” it is clear that those terms modify “state police power,” not
the specific type of regulation at issue in a given case. Thus, when analyzing
Section 14501(a)(2), that a type of regulation is new is irrelevant, so long as the
exercise of authority is within the state’s traditional safety-regulatory
authority.    The specific means of exercising such authority will doubtless
change over time, but the nature of the authority itself will not. As noted, we
have previously held this specie of regulation — permitting — is within the
state’s “safety regulatory authority.” See Cole, 314 F.3d at 734–35.
       There are distinctions, of course. Tow-truck and charter-bus industries
may differ in geographic scope. Differences in practical effect may arise from
similar constructions of the laws relating to each. Such differences, UMA
argues, should counsel against construing Section 14501(a)(2)’s safety
exception broadly, because a broad construction and application will lead to

       5It would indeed make little sense to construe “with respect to motor vehicles” as
narrowly as UMA argues. Under UMA’s interpretation, for example, the City could require
charter buses to use certain tire sizes, but it could not prohibit drinking and driving, even
though drunk driving is undoubtedly a safety concern “with respect to motor vehicles.”
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the very “balkanization of permit regimes” Congress meant to curtail through
the preemption provision. Such concerns notwithstanding, our focus is on the
text of what Congress actually enacted. The specific exception to preemption,
as we have explained, does not comfortably bear UMA’s narrow reading. Nor
will we interpret the exception narrowly to comport better with the broad
policy goals of deregulation. “A congressional decision to enact both a general
policy that furthers a particular goal and a specific exception that might tend
against that goal does not invariably call for the narrowest possible
construction of the exception.” See Ours Garage, 536 U.S. at 440.
        Finally, like the Supreme Court in Ours Garage, we take note of 49
U.S.C. § 31141, which authorizes the Secretary of Transportation to void any
“State law or regulation on commercial motor vehicle safety” that, in the
Secretary’s judgment, “has no safety benefit . . . [or] would cause an
unreasonable burden on interstate commerce.”         The Secretary, therefore,
retains authority to invalidate non-safety-related laws or safety-related laws
when they improperly burden interstate commerce.           Given all this, the
distinctions between Sections 14501(a) and (c) do not persuade us to construe
“safety regulatory authority” more narrowly in the former than in the latter.

II.     Genuinely Responsive to Safety?
        We next ask whether the permitting regulations are “genuinely
responsive” to safety. See VRC, 460 F.3d at 612. UMA argues the district court
erred in analyzing this question because it did not conduct a provision-by-
provision analysis. UMA contends that such a review reveals that certain
permitting regulations were not responsive to safety concerns.
        A provision-by-provision analysis of regulations generally should be
undertaken to determine whether each provision is genuinely responsive to
safety. See, e.g., California Tow Truck Ass’n, 807 F.3d at 1014. Here, although
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the district court did not go through the permitting regulations one by one in
its order, we find no error in its analysis.           One reason is that, as UMA
acknowledges, the district court heard testimony on the various provisions and
requested provision-by-provision briefing. In addition, UMA does not provide
substantive analysis as to specific provisions that allegedly do not relate to
safety, nor did it challenge the provisions in a provision-by-provision manner
in district court. In conducting its analysis as it did, the district court was
simply addressing the arguments before it.
      The question, then, is whether these regulations are responsive to
Section 14501(a)(2)’s focus on safety. The district court applied the Ninth
Circuit’s two-part test, asking (1) whether there was a safety motivation for
the scheme and (2) whether there was a nexus between the provision and the
safety concern.     See id. at 1019–20. 6        Again, we agree that the caselaw
interpreting and applying Section 14501(c)(2)(A) provides the appropriate
analysis for analyzing preemption under Section 14501(a)(2). Our cases have
applied a test that is similar to the Ninth Circuit’s. See Houston Prof’l Towing,
812 F.3d at 449–51. We now apply that test.
       First, we look “to statements of intent on the face of the ordinance” to
determine whether “it was designed to promote safety[.]” See id. at 449. Our
caselaw is illustrative of our approach. In Cole, we considered the preamble to
an ordinance but did not discuss whether the city had entered any studies or
expert testimony about the dangers being addressed. Cole, 314 F.3d at 734–
35. The ordinance stated “that the proposed safety-related regulations for
nonconsensual tows would promote the public safety” by, among other things,
“contributing to a decrease in the potential for confrontation and violence . . . .”

      6 The district court cited to an earlier opinion in California Tow Truck Association,
which was later modified by the Ninth Circuit. For simplicity’s sake, we cite only the
modified opinion. Which opinion is used does not affect our analysis.
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Id. at 735.    In light of the ordinance’s expressed purpose and effect, we
concluded the safety purpose was “manifest.” Id. In VRC, we likewise found
that there was a safety purpose when the city “considered the possibility of
violent confrontation” as “a safety issue and found that” the ordinance would
remedy it; when a city administrator testified “that there was a real problem
with confrontation between citizens and tow truck drivers and that the signs
had been helpful”; and when, “[l]ogically, the [ordinance’s requirements]
could . . . help to defuse the anger of some who actually were towed . . . .” VRC,
460 F.3d at 615.
      We analyzed the safety exception in another case decided after the
district court’s order here. See Houston Prof’l Towing Ass’n, 812 F.3d at 449.
There, we discussed the safety exception to determine whether a tow-truck
association’s challenge to a city ordinance was barred by res judicata. Id. at
448–49.    The association had previously challenged the ordinance, but a
district court held it to be within the safety exception. Id. at 446. Our analysis
was thus limited to whether intervening amendments to the ordinance had
changed the factual and legal basis for the association’s claim of preemption.
Id. at 449. After analyzing the applicability of the safety exception, we held
they had not.      Id. at 450–51.    In doing so, we looked to the ordinance’s
preamble, which “contain[ed] a number of clauses discussing the safety
motivations for the [ordinance].” Id. at 449–50. The preamble revealed the
ordinance’s purpose was “to promote safety by expeditiously clearing stalled
and wrecked vehicles”; hence we concluded that “[t]here [was] no doubt that
safety [was] the justification . . . .” Id. at 450.
      Here, the ordinance contains numerous safety-purpose statements. See
AUSTIN CITY CODE § 13-2-251. The ordinance states that various events make
the City a destination for “masses of visitors,” which “impact[s] public safety
and impede[s] the flow of pedestrian and vehicular traffic.” Id. For these
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reasons, the City found its “regulations [would] help to protect and ensure that
charter bus services use mechanically safe vehicles, operate their service in a
safe manner, and . . . meet minimum insurance coverage requirements.” Id.
Also, after recounting a history of charter-bus accidents in Texas, the
ordinance notes its effectiveness in preventing such “deadly accidents.” Id. It
makes clear that “the purpose of the . . . regulations is not to generate revenue
but as enumerated above, to protect the public health, safety, and welfare.” Id.
These statements are similar to those that we have previously held to evidence
a safety motivation. See, e.g., Houston Prof’l Towing Ass’n, 812 F.3d at 450;
Cole, 314 F.3d at 735. Here, like in those cases, we have no reason to “doubt
that safety is the justification for [the regulations].” See Houston Prof’l Towing
Ass’n, 812 F.3d at 450.
      We next look to “evidence that there was a ‘nexus between the ordinance
and public safety.’” Id. at 449 (alteration omitted) (quoting VRC, 460 F.3d at
614–15). The district court held there was. It held that the ordinance gave
“the City the ability to hold charter bus operators who do not comply with the
substantive safety provisions . . . accountable.” Examples the district court
mentioned included loading and unloading passengers in the street,
alternative transportation for passengers when a bus broke down, and
prohibitions on the sale of alcohol, controlled substances, and other criminal
conduct. It also noted that the permitting requirements “imply the threat of
permit revocation,” making them “tools for policing misconduct.”
      When the relation between the regulation and safety is obvious and
logical, the second prong of our analysis is satisfied. See VRC, 460 F.3d at 615;
see also California Tow Truck Ass’n, 807 F.3d at 1020. This is true even if
“municipalities are accomplishing some economic regulation, or more precisely
consumer protection, while making findings about safety in the preambles of
their ordinances.” See VRC, 460 F.3d at 615.
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      UMA may have a point that the City is accomplishing economic goals,
such as consumer protection, via some of the permitting regulations. We have
recognized, though, that “safety and consumer protection are not mutually
exclusive categories.” See id. We agree with the district court that for most of
the regulations, the relation is obvious and logical. For all of them, “the City’s
safety concerns are real enough that the court is convinced that they are both
reasonably related and genuinely responsive to safety concerns.” See id.
      The district court did not err by finding a nexus between the permitting
regulations and safety.
                                      ***
      The permitting regulations are not preempted by federal law. Thus, no
injunction may issue. AFFIRMED.

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