CTA calls for bench hearing as it seeks to keep AB 5 out of California trucking industry
As expected, the California Trucking Association has filed an appeal in its setback to keep AB 5 out of the state’s trucking industry, asking a full 9th ââcircuit to review a recent appeals court ruling.
In an action filed last week, CTA asked for a in bench hearing. In a bench action, the appealing party requests the full circuit to hear the case, with a subset of the full circuit assigned to it.
The bench application was filed last week.
In the case, CTA revisits the main arguments it made in its efforts to keep the AB 5 law on independent contractors out of the state trucking market. Throughout 2020 and through 2021, these arguments were successful, with a temporary injunction issued by a lower court early last year prohibiting the implementation of AB 5 in trucking then even. that it was beginning to govern and impact independent contractor relationships in other areas. (Independent concert drivers, like those at Uber, came off under AB 5 by the passage of the last polling day of Prop 22.)
But the state of California, in an appeal that heard oral arguments in early September, persuaded a divided Ninth Circuit appeals court earlier this month to overturn the injunction.
This injunction is still in place, now awaiting the full decision of the Ninth Circuit on whether to take the petition off the bench.
The part of AB 5 that’s problematic is what’s called pin B. Under Stream B, a worker hired to perform a function that is at the heart of what the company does – such as a hiring trucking company. an independent owner-operator of a truck – should be considered an employee. A trucking company that hires an outside accountant, for example, does not fall under Stream B.
In early 2020, the district court endorsed CTA’s argument that AB 5 was in conflict with the Federal Aviation Administration Authorization Act, a 1994 law that CTA said blocked AB 5 because of its impact. potential on âtariffs, routes and servicesâ. State laws that would affect these three parts of the market are excluded by the FAAAA. But the appeals court did not agree to quash the injunction.
CTA’s bench demand reiterates its view that AB 5 is in conflict with the FAAAA. Citing earlier legal precedents, lawyers for the association write that earlier courts “have ruled that the FAAAA (and almost identical wording in the Airline Deregulation Act) prevails over state laws, including laws generally applicable, which affect fares, routes or services, directly or indirectly. AB-5 is preempted according to this standard. “
The association’s record also indicates that other court decisions, one involving the US trucking associations, concluded that it would be “obvious that a ban on the use by motor carriers of independent contractors would likely be preempted.” “.
Maintaining the owner-operator model is “essential … because it” allows expansion in times of plenty and contraction during business shortages, “says CTA’s appeal, citing dissent in the case. Judge Bennett of the Three Judge Court of Appeal. Bennett also reportedly said that AB 5 “would require all motor carriers to reclassify all drivers of independent contractors as employed drivers”.
If that were to happen, the CTA said, quoting Judge Bennett, “it would eliminate the flexibility of motor carriers to adapt to fluctuations in supply and demand.” Justice Bennett’s arguments are frequently cited in the CTA case.
The appeals court ruled that AB 5 is a “law of general applicability”, not focused solely on trucking and would not “force a result in a road carrier’s relationship with consumers”.
The California trucking industry has consistently argued that AB 5 is not a law of general application. He cited the many exemptions granted to certain industries, whether in the original legislation or in subsequent legislation which was enacted in part to address the issues with independent contractors that arose when the law came into force. for the first time, as showing that this is multi-industry legislation. , including trucking.
In a footnote, the CTA quotes a statement by AB 5’s godmother, MP Lorena Gonzalez, from statements she made to the Assembly. “And let me speak for a
minute on trucking, âshe said, according to the CTA’s submission of her statements from a transcript. âWe’re getting rid of an outdated brokerage model that allows businesses to make money and set prices for people they used to call independent contractors.â
With so many precedents that could be seen as conflicting with the Ninth Circuit Appeals Court’s decision quashing the injunction, “the jury’s decision creates a recognized circuit split,” CTA lawyers write.
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