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National Association Seeks Support in Supreme Court Towing Case

Feb 5th, 2013 | By | Category: Spotlight

The following is a message from Towing and Recovery Association of America president Alan Gregg to the association’s members:

Re: Pelkey v Dan’s City Used Autos, United States Supreme Court

As many of you know, a case is now pending before the United States Supreme Court that involves the federal deregulation law and the sale and disposal of an unclaimed impounded vehicle. A vehicle owner sued a New Hampshire towing company under that state’s consumer protection law claiming that the towing company did not follow proper procedures in the lien sale of a vehicle. The towing company claimed that the court had no jurisdiction over the vehicle owner’s lawsuit because it was preempted, or prohibited, by the 1994 federal deregulation law which forbids economic regulations “related to” transportation by towing. If its position was correct, it would leave the vehicle owner with no legal avenue to address his complaint about the improper lien sale of his vehicle.

The NH Supreme Court held that liens sales are not “related to” transportation by towing and, therefore, that the case was not preempted by the federal law. The result was that the case against the tow company could proceed to trial. The tow company asked the U.S. Supreme Court to hear the case.

Because there have been many court cases in recent years on this topic with split decisions, the Supreme Court decided to accept the case. The Court is going to decide just how far the federal deregulation extends within the towing industry. In other words, what laws and regulations are “related to” transportation by tow truck, and therefore preempted, and which are not?

It is critically important that TRAA, as “The Voice of America’s Towing Industry,” present the towing industry’s position to the Supreme Court. That is done by filing an amicus curiae (or “friend of the court”) brief in the pending case. TRAA has retained towing industry attorney Michael McGovern and Washington DC attorney Erik Jaffe, to prepare that brief. You may recall that they wrote the amicus brief for TRAA in the Ours Garage case, which was referenced by the Court in its decision.

TRAA will be asking the Supreme Court to define “related to” in a manner that preserves the economic gains that the industry has made since the FAAA Act was enacted in 1994, but recognizes that Congress never intended for everything we do to be shielded from any sort of control or regulation. To take the extreme position that no aspect of a towing business can be regulated, and no conduct subjected to judicial scrutiny is, we believe, indefensible. Taking such a position before the Supreme Court would reflect negatively on the credibility of our industry.

In particular, TRAA will assert that the federal deregulation law should not close the courthouse door to vehicle owners claiming that they have been wronged by a towing company during the lien sale process. We think it is unrealistic to expect that the Supreme Court will rule that towing companies can make mistakes – or commit outright fraud – during the lien sale process without any risk of being sued. We will, however, be strenuously arguing that deregulation in matters such as the price charged for consensual towing, licensing laws, and other economic regulations, are within the purview of the FAAA Act and should remain preempted by federal law.

We are asking for your financial support for the preparation of the amicus brief to be filed on behalf of the towing industry. Supreme Court briefs are extremely complex and technical. The preparation of the brief will consume most of the attorneys’ time for the next several weeks. McGovern will also make a presentation about the case on March 22 during the L&L Conference in Washington, DC. The proposed fee for this brief is $30,000 plus expenses. While TRAA and some state associations are prepared to make a contribution to this brief, we would like to invite all concerned members to make a contribution to the expense of the writing of the brief. Whatever you can afford to contribute will be used for payment to the attorneys and will be very helpful! Click Here to Donate to the Legal Action Fund or Print a Form to Donate.

This will be a monumental decision with national impact. The towing industry, speaking through TRAA, has an obligation to present its position to the Supreme Court. The Court anticipates and appreciates amicus briefs from associations with a direct interest in cases before the Court. That was obvious in the Ours Garage case in which, as noted above, the Court’s opinion referred to TRAA’s brief.

Thank you.