Monday, May 13, 2013
The Supreme Court ruled today in Dan's City Used Cars, Inc. v. Pelkey that federal law does not preempt a plaintiff's state law claim against a towing company for the illegal sale of his car. The ruling affirms the New Hampshire Supreme Court's ruling in favor of the plaintiff and settles a split among state high courts on the question. Otherwise, the ruling doesn't break any new ground, and it's not a particular surprise.
The case arose when Dan's City towed Pelkey's car from his landlord's parking lot and later traded it away without compensating Pelkey. (Pelkey was suffering with a serious medical condition for which he was later hospitalized, and thus left his car in the parking lot during a snow--a towing offense under the landlord's rules.) Pelkey sued for wrongful sale (but not wrongful towing) under state law. The lower state court said that the Federal Aviation Administration Authorization Act, FAAAA, preempted Pelkey's suit and dismissed the case. (The FAAAA applies to motor carriers.) The New Hampshire Supreme Court reversed, and this appeal followed.
The FAAAA preemption clause says,
[A] State . . . may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier . . . with respect to the transportation of property.
In an opinion by Justice Ginsburg, the unanimous Supreme Court held that Pelkey's suit wasn't "with respect to the transportation of property," because it was based on the allegedly wrongful sale of his car after it was transported--that is, post-towing. The Court said that this result is consistent with congressional purposes is enacting the FAAAA preemption clause.