Cedarhurst Air Charter, Inc. v. Waukesha County

110 F. Supp. 2d 891, 2000 WL 1201601
CourtDistrict Court, E.D. Wisconsin
DecidedMarch 30, 2000
Docket99-C-1199
StatusPublished
Cited by9 cases

This text of 110 F. Supp. 2d 891 (Cedarhurst Air Charter, Inc. v. Waukesha County) is published on Counsel Stack Legal Research, covering District Court, E.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cedarhurst Air Charter, Inc. v. Waukesha County, 110 F. Supp. 2d 891, 2000 WL 1201601 (E.D. Wis. 2000).

Opinion

DECISION AND ORDER

MYRON L. GORDON, District Judge.

Plaintiff Cedarhurst Air Charter, Inc. [“CAC”] operates its business out of Waukesha County Airport, which is owned by defendant Waukesha County. The county leases space at the airport to a “fixed base operator” [“FBO”], a private business that manages and operates the airport pursuant to a contract with the county. The county requires all owners who store their aircraft at the airport to buy fuel from the FBO; owners are not permitted to fuel their own planes, and fuel vendors other than the FBO are not allowed to do business at the airport.

These allegations, which are taken from the plaintiffs complaint and accepted as true only for present purposes, form the basis for CAC’s claims that the county violated federal antitrust laws by conspir *893 ing with the FBO to monopolize the market for aircraft fuel (Sherman Act § 2, 15 U.S.C. § 2) and creating an illegal tying arrangement (Sherman Act § 1, 15 U.S.C. § 1). The plaintiff also contends that the county is liable under 42 U.S.C. § 1983 for the denial of CAC’s rights under Airport and Airway Improvement Act [“AAIA”], Federal Aviation Administration [“FAA”] regulations and the Commerce Clause. The county has moved to dismiss all of these claims pursuant to Rule 12(b)(6),. Fed. R.Civ.P.

I. FEDERAL ANTITRUST CLAIMS

The county asserts that CAC’s antitrust claims are barred by the state action immunity from antitrust liability established by the Supreme Court in Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943). In Parker the Court held that the Sherman Act did not apply to anticompeti-tive restraints imposed by the States “ ‘as an act of government.’ ” City of Columbia v. Omni Outdoor Advertising, Inc., 499 U.S. 365, 370, 111 S.Ct. 1344, 113 L.Ed.2d 382 (1991) (quoting Parker, 317 U.S. at 352, 63 S.Ct. 307). This immunity does not directly apply to local governments, unless the municipality’s restriction of competition is pursuant to a state policy. Columbia, 499 U.S. at 370, 111 S.Ct. 1344. For the immunity to apply, there must be a “clear articulation of a state policy to authorize anticompetitive conduct by the municipality”. Id. at 372, 111 S.Ct. 1344. However, the relevant state statute need not explicitly permit the displacement of competition; it is enough if the displacement is the foreseeable result of what the statute authorizes. Id. at 372-73, 111 S.Ct. 1344.

In the present case, Wisconsin statutes grant the county broad authority to establish, operate and regulate a local airport. Wis.Stats. §§ 114.11(1) and 114.14(1). The county has the authority to “adopt regulations, and establish fees or charges for the use of the airport”. § 114.14(1). The county has established an airport commission pursuant to § 114.14(2)(a), and the commission is empowered to “make such contracts or other arrangements as may be deemed necessary for the construction, improvement, equipment, maintenance or operation of the airport.” § 114.14(3). The county argues that these airport statutes constitute a “sweeping grant of authority [that] anticipates anticompetitive conduct by local governments with respect to local airports, and therefore affords the County state action immunity to antitrust claims arising out of such conduct.”

The plaintiff disagrees and argues that several statutes demonstrate the legislature’s intent to forbid the allegedly anti-competitive conduct challenged here. One set of statutes relied upon by CAC is found in Wisconsin’s antitrust laws, § 133.03 et seq., Wis.Stats. Section 133.03 forbids, in , language similar to that of the Sherman Act, agreements or conspiracies to restrain or monopolize trade, and its prohibitions apply to municipal governments. § 133.02(3); American Medical Transport of Wisconsin, Inc. v. Curtis-Universal, Inc., 154 Wis.2d 135, 148, 452 N.W.2d 575 (1990) (hereafter “AMT”). The Wisconsin legislature has mandated that the statute be interpreted liberally to promote competition (id. at 151, 452 N.W.2d 575 (citing § 133.01)), and it has instructed “state regulatory agencies [to] regard the public interest as requiring the maximum level of competition in any regulated industry consistent with the other public interest goals established by the legislature.” § 133.01.

I conclude that CAC’s argument is correct. The county’s claim of state action immunity is based only on the broad, general grant of authority by the legislature to the county with respect to airports. However, it is often difficult to distinguish between “a [state] regulatory program designed to supplant the operation of the free market [and] ... one that can coexist happily with the full enforcement of federal antitrust principles”. Hardy v. City Optical Inc., 39 F.3d 765, 768 (7th Cir.1994). The state antitrust statutes cited by the *894 plaintiff suggest that the state legislature intended the latter as opposed to the former.

The county has failed to explain how its claims of state action immunity can be reconciled with state antitrust laws. The county criticizes the cases relied on by the plaintiff as irrelevant or too old, but a recent Wisconsin Supreme Court ease (1990), not cited by the parties, supports the plaintiffs view. See AMT, 154 Wis.2d at 148-154, 452 N.W.2d 575. AMT discussed the interaction between broad grants of regulatory authority to municipal governments, on the one hand, and state antitrust law on the other. AMT involved a claim under state rather than federal antitrust law; therefore the defense of state action immunity, grounded in principles of federalism, was technically inapplicable. See id. at 145 — 46, 452 N.W.2d 575. Nevertheless, the ultimate question in that case was, just as it is here, whether the legislature intended to authorize the alleged anti-competitive conduct challenged by the plaintiffs. Id. at 146, 452 N.W.2d 575. See also Town of Hallie v. City of Eau Claire, 471 U.S. 34, 44 n. 8, 105 S.Ct.

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Bluebook (online)
110 F. Supp. 2d 891, 2000 WL 1201601, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cedarhurst-air-charter-inc-v-waukesha-county-wied-2000.