Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 1 of 8 1 2 3 4 5 6 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 9 10 11 12 13 _______________________________________ ) CHAMBER OF COMMERCE OF THE ) UNITED STATES OF AMERICA, ) ) Plaintiff, ) v. ) ) THE CITY OF SEATTLE, et al., ) ) Defendants. ) _______________________________________) No. C16-0322RSL ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS 14 This matter comes before the Court on “Defendants’ FRCP 12(b)(1) Motion to Dismiss.” 15 Dkt. # 30. City of Seattle Ordinance 124968 took effect on January 22, 2016, by operation of 16 SMC 1.04.020(B) after the Mayor declined to sign and returned it to the City Council. The 17 Ordinance provides a mechanism through which for-hire drivers can collectively bargain with 18 the companies that hire, contract with, and/or partner with them. Dkt. # 31-1 at 5-25. Plaintiff, 19 the Chamber of Commerce of the United States of America, seeks to enjoin enforcement of the 20 Ordinance, arguing that it violates and is preempted by federal antitrust law, is preempted by the 21 National Labor Relations Act, and violates the Washington Consumer Protection Act and the 22 Washington Public Records Act. Two entities that qualify as “driver coordinators” under the 23 Ordinance are members of the plaintiff organization. In this motion, defendants argue that the 24 Chamber lacks standing to pursue its claims and that the claims are not prudentially ripe. 25 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 2 of 8 1 Having reviewed the memoranda, declarations, and exhibits submitted by the parties and 2 having heard the arguments of counsel, the Court finds as follows: 3 A. STANDING 4 The judicial power of the federal courts extends to “Cases” and “Controversies” pursuant 5 to Article III, Sec. 2 of the United States Constitution. In order to give meaning to those 6 limitations, courts have developed the doctrine of standing, which makes clear that the role of 7 the courts is “neither to issue advisory opinions nor to declare rights in hypothetical cases, but to 8 adjudicate live cases or controversies.” Maldonado v. Morales, 556 F.3d 1037, 1044 (9th Cir. 9 2009). Standing “is built on separation-of-powers principles [and] serves to prevent the judicial 10 process from being used to usurp the powers of the political branches.” Clapper v. Amnesty Int’l 11 USA, 568 U.S. __, 133 S. Ct. 1138, 1148 (2013). “The party invoking federal jurisdiction bears 12 the burden of establishing standing.” Id. 13 To establish the existence of an Article III case or controversy, plaintiff must show that 14 “(1) it has suffered an ‘injury in fact’ that is (a) concrete and particularized and (b) actual and 15 imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged 16 action of the defendant[s]; and (3) it is likely, as opposed to merely speculative, that the injury 17 will be redressed by a favorable decision.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. 18 (TOC), Inc., 528 U.S. 167, 180-81 (2000) (quoting Lujan v. Defenders of Wildlife, 504 U.S. 19 555, 560-61 (1992)). An association, such as the Chamber, “has standing to bring suit on behalf 20 of its members when: (a) its members would otherwise have standing to sue in their own right; 21 (b) the interests it seeks to protect are germane to the organization’s purpose; and (c) neither the 22 claim asserted nor the relief requested requires the participation of individual members in the 23 lawsuit.” Hunt v. Wash. State Apple Advertising Comm’n, 432 U.S. 333, 343 (1977). 24 25 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -2- Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 3 of 8 1 1. Standing of Individual Members 2 The Chamber has presented evidence that Uber Technologies, Inc., and Eastside for Hire, 3 Inc., are members of the Chamber of Commerce and qualify as “driver coordinators” under the 4 Ordinance. The Chamber asserts that these members face a substantial risk of future injury and 5 are suffering present harm as a result of the Ordinance. 6 7 a. Future Injury Under the Ordinance, unions and other representational organizations may request 8 recognition as a qualified driver representative (“QDR”). If recognition is granted, the QDR 9 contacts the driver coordinator whose drivers it seeks to represent in order to obtain contact 10 information for all qualifying drivers. The QDR then uses the contact information to solicit the 11 drivers’ interest in being represented by the QDR. If a majority of the qualifying drivers express 12 an interest in being represented, the City will certify the QDR as the exclusive driver 13 representative (“EDR”) for all drivers associated with that driver coordinator. If no EDR is 14 certified, the driver coordinator shall not be the subject of another representational drive for at 15 least twelve months. If an EDR is certified, the driver coordinator must meet and negotiate with 16 the EDR regarding topics such as vehicle equipment standards, safe driving practices, the nature 17 and amount of payments to drivers, and hours and conditions of work. 18 The Chamber argues that Uber and Eastside will be injured in the first instance if they 19 have to turn over the contact information for their drivers. Not only would the production force 20 Uber and Eastside to expend time and money, but the Chamber argues that the disclosure of 21 driver lists would destroy the value of Uber and Eastside’s intellectual property/trade secrets and 22 impinge on the privacy of the third-party drivers. As the City points out, however, whether Uber 23 or Eastside will be the target of a representational drive is far from certain. While one can 24 reasonably assume based on the legislative history that Teamsters Local 117 is interested in 25 pursuing certification as an EDR, there is no indication that it has set its sights on the drivers 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -3- Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 4 of 8 1 2 associated with either Uber or Eastside. The “injury in fact” requirement of the Article III standing analysis helps ensure that the 3 plaintiff has a personal stake in the prosecution and outcome of the litigation. Warth v. Seldin, 4 422 U.S. 490, 498 (1975). A speculative or hypothetical interest is deemed insufficient “so as to 5 reduce the possibility of deciding a case in which no injury would have occurred at all.” Lujan, 6 504 U.S. at 564 n.2. An allegation of an injury arising entirely in the future will suffice only “if 7 the threatened injury is certainly impending[] or there is a substantial risk that the harm will 8 occur.” Susan B. Anthony List v. Driehaus, __ U.S. __, 134 S. Ct. 2334, 2341 (2014) (internal 9 quotation marks omitted). Whether Uber or Eastside, neither of which has been called upon to 10 produce driver lists or to engage in collective bargaining, has suffered an “actual or imminent” 11 injury for purposes of Article III depends on whether there is “a realistic danger of sustaining a 12 direct injury as a result of the statute’s operation or enforcement.” Lujan, 504 U.S. at 560; 13 Babbitt v. Farm Workers, 442 U.S. 289, 298 (1979). 14 Any injury arising from the recognition of a QDR – whether that be the obligation to 15 disclose driver contact information or the need to engage in collective bargaining – is wholly 16 contingent on the QDR’s choice of target. It is, of course, possible that a QDR will attempt to 17 represent the drivers associated with Uber and/or Eastside as soon as the processes set forth in 18 the Ordinance commence. The Court finds, however, that it is just as likely, if not more so, that a 19 QDR, once recognized, will choose to work through the procedures for the first time with a 20 driver coordinator that has not made its antipathy toward collective action so well-known and/or 21 is not primed to file suit immediately. The Chambers’ theory of standing relies on a speculative 22 chain of events controlled entirely by the choices of third parties not currently before the Court. 23 See Clapper, 133 S. Ct. at 1150 (“In the past, we have been reluctant to endorse standing 24 theories that require guesswork as to how independent decisionmakers will exercise their 25 judgment.”). The alleged future injuries are not “actual,” nor has the Chamber shown that they 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -4- Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 5 of 8 1 are “certainly impending” or otherwise imminent.1 At this point in time, neither Uber nor 2 Eastside has standing to challenge the validity of the representational and collective bargaining 3 aspects of the Ordinance. b. Present Injury 4 The Chamber argues that Uber and Eastside are currently incurring actual, on-going 5 6 injuries, namely “(i) coerced compliance with the Ordinance’s anti-retaliation provision, and 7 (ii) the members’ reasonable expenditures to prepare for the operation of the Ordinance, such as 8 educating drivers about the impacts of unionization, participating in rulemaking, and hiring 9 consultants and attorneys for assistance with union organizing and the collective-bargaining 10 process.” Dkt. # 39 at 12-13. (i) Anti-Retaliation Provision 11 Eastside asserts that it “immediately wishes to amend its existing driver contracts to 12 13 preclude drivers from providing statements of interest to any ‘Qualified Driver Representative’ 14 seeking to act as an ‘Exclusive Driver Representative’ for purposes of collective bargaining 15 under the Ordinance.” Decl. of Samatar Guled (Dkt. # 42) at ¶ 11. Because the Ordinance 16 precludes driver coordinators from providing or offering anything of value to drivers for the 17 purpose of encouraging or discouraging them from exercising the right to participate in the 18 representative process (Dkt. # 31-1 at 19), Eastside claims that the Ordinance is causing present 19 injury. 20 Defendants have raised both a facial and a factual challenge to the Chamber’s standing to 21 22 23 24 25 1 Recent events highlight the uncertainties associated with the injuries claimed by the Chamber. As discussed in the parties’ supplemental letters to the Court, the City has requested six additional months in which to establish the rules by which drivers can indicate support or opposition to representation by a QDR. See http://www.seattletimes.com/seattle-news/politics/mayor-wants-more-time-on-unionizing-uber-lyft-driv ers/ 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -5- Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 6 of 8 1 pursue this litigation. In effect, defendants assert that the Court lacks subject matter jurisdiction 2 over this matter under Fed. R. Civ. P. 12(b)(1). In order to survive defendants’ factual challenge, 3 plaintiff must present evidence that could support factual findings in its favor. Maya v. Centex 4 Corp., 658 F.3d 1060, 1067 (9th Cir. 2011); Kingman Reef Atoll Invs., LLC v. U.S., 541 F.3d 5 1189, 1195 (9th Cir. 2008). Eastside’s allegation of injury – that it “immediately wishes” to 6 engage in conduct that is arguably affected with a constitutional interest, but is now proscribed 7 by the Ordinance (Babbitt, 442 U.S. at 298) – is contradicted by the actual facts of this case. The 8 Ordinance was drafted in the fall of 2015, discussed and amended by the City’s Finance and 9 Culture Committee, and approved unanimously by the City Council on December 14, 2015. The 10 bill was submitted to the Mayor for signature and returned unsigned at the end of 2015. By 11 operation of SMC 1.04.020(B), the Ordinance took effect on January 22, 2016. The anti- 12 retaliation provision, however, did not become effective for another 150 days. Dkt. # 31-1 at 23 13 (Section 5). There is no indication that Eastside made any effort to amend its driver contract 14 during this extended period. Thus, on May 7, 2016, when Mr. Guled asserted that Eastside 15 “immediately wishes” to amend its contracts, it could have done so: the anti-retaliation provision 16 did not become enforceable until the end of June 2016. The fact that Eastside refrained from 17 amending its driver contracts shows that it either did not want to make the change (contrary to 18 Mr. Guled’s statement) or that its decision not to amend was unrelated to the Ordinance. Either 19 way, the Court finds that Eastside has failed to show, as a matter of fact, that the Ordinance 20 caused its alleged injury. 21 22 (ii) Expenditures to Respond to Ordinance Uber and Eastside contend that they have incurred costs as a reasonable reaction to the 23 Ordinance, including hiring consultants and experts to help them navigate the world of organized 24 labor, communicating with their drivers about the impacts of unionization, and participating in 25 the City’s rulemaking efforts. Any expenditures of time or money that are related to the City’s 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -6- Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 7 of 8 1 requests for driver data are completely voluntary. The Ordinance does not impose a duty on the 2 driver coordinators to participate in the rulemaking process or to provide any information prior 3 to the point in time when a QDR requests driver contact information. 4 With regards to the consultants and driver education activities, the harm Uber and 5 Eastside are seeking to avoid is not certainly impending (as discussed above in Section A.1.a.). 6 Uber and Eastside “cannot manufacture standing merely by inflicting harm on themselves based 7 on their fears of hypothetical future harm that is not certainly impending . . . Any ongoing 8 injuries that [Uber and Eastside] are suffering are not fairly traceable to [the Ordinance]. If the 9 law were otherwise, an enterprising plaintiff would be able to secure a lower standard for Article 10 III standing simply by making an expenditure . . . in response to a speculative threat.” Clapper, 11 133 S. Ct. at 1151 (internal quotation marks and citations omitted).2 While it may be “eminently 12 reasonable” for driver coordinators “to take measures to prevent or mitigate the harm” they may 13 face due to possible future representational efforts, they cannot parlay actions taken in reaction 14 to a risk of harm into the necessary “certainly impending” injury. Habeas Corpus Res. Ctr. v. 15 U.S. Dep’t of Justice, 816 F.3d 1241, 1251 (9th Cir. 2016). 16 2. Standing of Association 17 Neither of the Chambers’ members has suffered an injury that is traceable to the 18 Ordinance and would be redressed if the Ordinance were declared invalid or enforcement were 19 otherwise enjoined. Thus, the Chamber itself has no standing to pursue the claims asserted in 20 this litigation. 21 B. RIPENESS 22 23 The Chamber lacks standing to pursue any claim in this matter, and the doctrine of ripeness cannot remedy the constitutional deficiency. 24 25 2 The City has not pursued its traceability and redressability arguments in its reply memorandum. 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -7- Case 2:16-cv-00322-RSL Document 63 Filed 08/09/16 Page 8 of 8 1 For all of the foregoing reasons, defendants’ motion to dismiss (Dkt. # 30) is GRANTED. 2 The Clerk of Court is directed to enter judgment without prejudice in favor of defendants and 3 against plaintiff. 4 5 Dated this 9th day of August, 2016. 6 A Robert S. Lasnik 7 United States District Judge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS -8-