Krause Marine Towing Corp. v. Ass'n of Maryland Pilots

44 A.3d 1043, 205 Md. App. 194, 2012 A.M.C. 2323, 2012 WL 1959303, 2012 Md. App. LEXIS 56
CourtCourt of Special Appeals of Maryland
DecidedMay 31, 2012
Docket561, Sept. Term, 2010
StatusPublished
Cited by9 cases

This text of 44 A.3d 1043 (Krause Marine Towing Corp. v. Ass'n of Maryland Pilots) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Krause Marine Towing Corp. v. Ass'n of Maryland Pilots, 44 A.3d 1043, 205 Md. App. 194, 2012 A.M.C. 2323, 2012 WL 1959303, 2012 Md. App. LEXIS 56 (Md. Ct. App. 2012).

Opinion

*198 KEHOE, J.

At the heart of this appeal is an antitrust challenge to the work assignment rules of the Association of Maryland Pilots (the “Association”) as they affect pilotage and tug services rendered to cargo ships in the Port of Baltimore.

Appellants, Krause Marine Towing Corporation (“KMTC”), a company that provides tug services, and Joseph L. Krause, Jr. (“Krause”), a docking master licensed by the Maryland Board of Pilots (the “Board”), filed a multi-count complaint in the Circuit Court for Baltimore City against the State, the Board, the Association, and several individual members of the Association. 1 At trial, the court granted appellees’ motion for judgment at the conclusion of appellants’ case in chief. Before this Court, only two of appellants’ claims remain in dispute: (1) KMTC’s assertion that the Association inhibited its ability to compete for tug business in violation of Maryland’s Antitrust Act, see Md.Code Ann., Com. Law (“CL”) §§ 11-201 et seq. (1975, 2005 Repl.Vol.), specifically, CL § 11-204(a) (stating that “[a] person may not ... unreasonably restrain trade or commerce.”); and (2) Krause’s claim that the Maryland Pilots Act (the “Act”), see Md.Code Ann., Bus. Occ. & Prof. (“BOP”) §§ 11-101 et seq. (1989, 2010 Repl.Vol.), infringes upon his right to contract freely.

Appellants present four issues to us. First, KMTC asserts that the trial court erred in granting the Association’s motion for judgment on KMTC’s antitrust claim. We hold that the trial court did not err because KMTC did not prove that the Association’s work rules unreasonably restrained competition.

Second, KMTC argues that the trial court erred in permitting the Association to assert a statute of limitations defense at trial, thus limiting its claim for damages. We need not *199 address this contention because we have decided against KMTC on its antitrust claim. As KMTC concedes, the statute of limitations issue would only be relevant if we decided in favor of KMTC on the merits of this appeal.

Third, Krause contends that the trial court erred in granting the State’s motion for judgment on his claim that Maryland docking masters should not be required to be members of the Association. Krause argues that this requirement is an unconstitutional exercise of the State’s police power. This contention, as presented to this Court, has not been preserved for appellate review.

Finally, both appellants argue that the trial court erred by failing to issue a declaratory judgment as to their antitrust and constitutional claims. We agree. In disposing of appellants’ claims, the trial court failed to enter a declaratory judgment, and we will remand the case to the circuit court for entry of a judgment declaring the rights of the parties in accordance with this opinion.

Background

Overview: Pilotage and Tug Services in the Port of Baltimore

The majority of the relevant facts that fuel this dispute arise from tug boat activities in the Port of Baltimore. The Port is one of the busiest in the United States. 2 The container, *200 vehicle transport, and bulk carrier ships that use the Port are enormous: they can be more than three football fields long, up to 138 feet wide and can draw nearly 48 feet. These vessels are too large to berth and unberth by themselves; they require the assistance of tug boats to safely accomplish this task.

There are two types of pilots that help guide these maritime behemoths into and out of port. The first are bay pilots (also referred to as harbor pilots), who direct vessels from the open sea through the Chesapeake Bay to the ship’s port of destination (and vice versa). S.B. 237 (2000), Fiscal Note at 2. 3 The *201 second are docking masters (also called docking pilots), whose primary responsibility is to coordinate and direct the services of tugs to maneuver a ship as it moors and unmoors. H.B. 884 (2004), Fiscal Note at 5. Krause is a docking master; the regulation of docking masters (as opposed to bay pilots) is at the heart of this appeal.

Moving these ships through the Chesapeake Bay to their destination requires tightly planned coordination. Each steamship line that does business in the Port of Baltimore maintains a “ship’s agent.” Prior to the arrival of a vessel in the Chesapeake Bay, the ship’s agent notifies the Association that a bay pilot is needed to guide the ship to Baltimore. Sunset Review (2001) at 27. As the ship nears its destination, the ship’s agent makes arrangements for the mooring of the vessel by notifying the Association that a docking master is required and by contacting a tug company. The Association assigns jobs according to established work rules that provide for rotation among pilots and docking masters. (We will discuss these work rules more fully later).

Three ship-docking tug companies serve the Baltimore harbor: KMTC, 4 McAllister Towing of Baltimore, Inc., and Moran Towing Corporation. Each company owns a number of tugs that vary in utility for a given job because of size, design and engine power. Either directly or through affiliates, McAllister and Moran provide tug services to numerous commercial ports in the United States. KMTC focuses primarily on the Port of Baltimore. The three marine tug companies compete for business. In contrast, as we will explain, docking masters have a legally-established monopoly for their services and their fees are regulated by the Public Service Commission.

*202 The Disputes

There are two separate claims that we must address in this case. One involves an antitrust claim brought by KMTC against the Association. The other involves a constitutional challenge to the Act brought by Krause against the State. Both claims involve the Association’s work rules for docking masters.

The Association’s work rules, dated February 2009, were entered into evidence before the trial court. These rules establish a rotation schedule so that each docking master is subject to approximately the same workload. Sunset Review (2009) at 4. Under these rules, docking masters work two weeks on duty and two weeks off duty, and when they are on duty they complete a three-assignment turn. When the three assignments are completed, the docking master returns to the back end of the rotation schedule. Critical to the underlying dispute in this case, when a ship’s agent contacts the Association’s dispatch unit to obtain a docking master for a ship, the docking master at the front end of the rotation schedule is automatically assigned to that vessel. As a result, steamship lines cannot contract directly with a particular docking master, nor can a docking master control which steamship line he or she serves on a regular basis.

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44 A.3d 1043, 205 Md. App. 194, 2012 A.M.C. 2323, 2012 WL 1959303, 2012 Md. App. LEXIS 56, Counsel Stack Legal Research, https://law.counselstack.com/opinion/krause-marine-towing-corp-v-assn-of-maryland-pilots-mdctspecapp-2012.