NEWS & REPORTS

Western States Trucking Association’s FAAAA Preemption Argument Dismissed by California District Court

Apr 2, 2019 | Industry News

On March 29, the United States District Court for the Eastern District of California held that the Federal Aviation Administration Authorization Act (“FAAAA”) does not preempt the application of the Dynamex ABC Test to a motor carrier for purposes of determining whether owner-operators are considered employees under California’s Wage Orders. Western States Trucking Ass’n v. Schoorl, 2019 WL 1426304, *10 (E.D. Cal. Mar. 29, 2019).

In its ruling, the court reasoned that, although the decision in Dynamex applied the ABC Test to interpret the meaning of “engage, suffer, or permit to work” for purposes of California Wage Order No. 9, the definition was equally applicable “across the board to all wage orders” and that recent Ninth Circuit decisions applied, resulting in a decision that Dynamex is not preempted by the FAAAA. See Californians for a Safe and Competitive Dump Truck Transp. v. Mendonca and Dilts v. Penske Logistics, LLC. In so doing, the court specifically disagreed with the Central District of California’s decision in Alvarez v. XPO Logistics Cartage, LLC.

In its discussion, the court found that the rationale of Mendonca and Dilts applied, and that the generally applicable interpretation of the term “employ” as used in Dynamex “does not run afoul of the FAAAA simply because that interpretation may have some effect on transportation services.” The court then specifically held that the impact of Dynamex on prices, routes, and services of a motor carrier was indirect and insufficient to warrant preemption.

Without further guidance from an appellate court, it is difficult to predict where future courts will land regarding this developing split of authority addressing preemption. In the interim, any motor carrier utilizing owner-operators in California should consider taking steps to avoid becoming a misclassification litigation target and potentially reduce liability exposure in the event of a misclassification determination. For questions about the Dynamex, Western States, or Alvarez decisions, please contact Jim Hanson or Greg Feary.

For a more complete discussion of the Dynamex decision, please see our May 2, 2018 Transportation Law Alert and June 21, 2018 Transportation Law Alert, For a more complete discussion of the Alvarez decision please see our December 5, 2018 Law Alert.

About the Author

NEWS & REPORTS

Trucking Combats Soaring Nuclear Verdicts and Insurance Costs

Experts Recommend Mitigation Strategies Like Ensuring Safety of Equipment, Smart Insurance Policies, Relationships With Attorneys Connor D. Wolf SAN DIEGO — The trucking industry has been facing surging unfavorable verdicts and insurance costs as biases and policies...

CVSA Annual Conference Recap

North American Standard Out-of-Service Criteria The following amendments were suggested for the North American Standard Out-of-Service Criteria (OOSC). They were presented to Class I Members for a vote. The approved changes will be incorporated into next year’s...

Drivers Most Fret About Wages Not Keeping Up With Inflation

Truck Parking Slips to No. 2 Spot in Annual ATRI Survey Keiron Greenhalgh Adequate compensation is the top concern among professional drivers in 2025, according to the American Transportation Research Institute’s annual survey of trucking industry participants. Driver...

A truck crash study redo

Mark Schremmer About two decades ago, the Federal Motor Carrier Safety Administration attempted to study the causes of large truck crashes. It’s fair to say that the truck crash study was a disappointment. As Land Line Managing Editor Jami Jones pointed out in a...

Trucking lawsuits driving up food prices, killing jobs

Tyson Fisher An increase in lawsuits and nuclear verdicts has been a growing problem for the trucking industry. However, researchers found that sweeping tort reform would greatly benefit all Americans, including addressing one of their main concerns: food prices. Tort...

CATEGORIES