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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION NATIONAL SOLID WASTES MANAGEMENT ASSOCIATION, et al. Plaintiffs, v. THE CITY OF DALLAS, et al. Defendants.

Civil Action No 3:11-CV-03200-O ECF

DEFENDANTS MOTION FOR NEW TRIAL WITH SUPPORTING BRIEF Pursuant to Rule 59 of the Federal Rules of Civil Procedure, Defendants move for entry of an order granting a new trial, and in support of their motion state as follows: I. INTRODUCTION

The Court entered its Memorandum Opinion and Order (ECF 77, hereafter the Order) and Final Judgment (ECF 78) on October 16, 2012. In the Order, the Court held that the City of Dallas (City) Ordinance No. 28427 (September 28, 2011) (the Flow Control Ordinance or the Ordinance) (i) was not preempted by state law, (ii) was not void for vagueness, (iii) was not going to be arbitrarily enforced, and (iv) did not impermissibly delegate authority to the Citys Sanitation Director.1 However the Order directed Defendants not to enforce the

Ordinance against some City franchisees including some of the Plaintiffs because the Court held the Ordinance impaired their franchises in violation of the Contract Clause of the U.S. Constitution. Order at 12. The Court further held that the Flow Control Ordinance violated the Due Course of Law Provision of the Texas Constitution. Id. at 12-18. The Courts decision was
1

Plaintiffs also amended their complaint to drop claims under the federal Sherman Antitrust Act prior to the issuance of the Order. Page 1

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based, in part, on its interpretation of the Citys solid waste franchise agreements, the Ordinance, and case law regarding Contracts Clause of the U.S. Constitution. After first deciding the constitutional issues, the Court found that franchised Plaintiffs claims under the Dallas City Charter against the defendants who are City Council members were moot because it had already decided the Contracts Clause constitutional issue in favor of the franchised Plaintiffs. Id. at 18-22. In granting a permanent injunction against the City, the Court also found that there was a real and immediate threat of fines and criminal penalties for Plaintiffs. Id. at 33-34. This Motion sets forth the following five manifest, material, and prejudicial errors of law, each of which provide independent grounds on which this Court must grant a new trial: (1) the Order does not comply with the fundamental rule of constitutional avoidance; (2) the Order fails to show proper deference to a democratically-elected legislature in favor of an improperly applied and unspecified heightened level of scrutiny; (3) the Order is an improper injunction against imminent criminal prosecution in state court; (4) the Order improperly identifies the applicable date for the injunction barring enforcement of franchises that commenced before the date of the Order rather than before a date on which any franchise applicants reasonably should have anticipated the possibility of flow control; and (5) the Orders literal mandate against enforcement of franchise agreements that commenced before the date of the Order is overly broad because it is not limited to valid solid waste hauler franchises. Accordingly, Defendants request that the Court vacate the Order and Final Judgment and proceed with a new trial. II. LEGAL STANDARD

Federal Rule of Civil Procedure 59(a)(1)(B) provides that a federal court may grant a new trial after a nonjury trial for any reason for which a rehearing has heretofore been granted in a suit in equity in federal court. The Fifth Circuit elaborated on this standard by holding that

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motions for a new trial must: (1) clearly establish either a manifest error of law or fact; or (2) present newly discovered evidence. See Simon v. United States, 891 F.2d 1154, 1159 (5th Cir. 1990). Moreover, [a]ny error of law, if prejudicial, is a good ground for a new trial.

Colegrove v. Cameron Mach. Co., 172 F. Supp. 2d 611, 632 (W.D. Pa. 2001) (citing 11 CHARLES ALAN WRIGHT, ARTHUR R. MILLER & MARY K. KANE, FEDERAL PRACTICE PROCEDURE 2805 (1995)). III. A. ARGUMENT
AND

The Order is manifestly erroneous as a matter of law because it does not follow the rule of constitutional avoidance.

The rule of constitutional avoidance requires that prior to reaching any of the constitutional questions presented in litigation, federal courts must first consider the nonconstitutional grounds for decision resolving the case on non-constitutional grounds if possible. Gulf Oil Co. v. Bernard, 452 U.S. 89, 99 (1981). This principle, under which a Court will not decide a constitutional question if there is some other ground upon which to dispose of the case . . . is a well-established principle governing the prudent exercise of this Courts jurisdiction. Northwest Austin Mun. Util. Dist. No. One v. Holder, 557 U.S. 193, 205 (2009) (quoting Escambia County v. McMillan, 466 U.S. 48, 51 (1984)). Constitutional avoidance is also a fundamental rule of judicial restraint. Three Affiliated Tribes of Berthold Reservation v. Wold Engg, 467 U.S. 138, 157 (1984). [I]f there is one doctrine more deeply rooted than any other in the process of constitutional adjudication, it is that we ought not to pass on questions of constitutionality ... unless such adjudication is unavoidable. Jean v. Nelson, 472 U.S. 846, 854 (1985) (Rehnquist, C.J.) (affirming Circuit Courts judgment to remand to federal district court for consideration of non-constitutional issue instead of constitutional issue) (quotation omitted).

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The Order is manifestly erroneous because it ignores the rule of constitutional avoidance. Instead of deciding the non-constitutional issue of whether the Flow Control Ordinance violates the Dallas City Charter, the Court addressed the constitutional issue first. Indeed, the Order states that [s]ince the Court has previously declared the Flow Control Ordinance unconstitutional, Plaintiffs request to enjoin the individual defendants from enacting the Flow Control Ordinance unless and until they have a hearing is moot. Order at 22. Actually, Plaintiffs did not seek to enjoin the Flow Control Ordinances enactment based on their Dallas City Charter violation argument. Plaintiffs only asked the Court to: (e) find and declare the ordinance is unenforceable until there has been notice and an appropriate hearing that results in a final non-appealable order amending the franchise agreements consistent with the ordinance. Amended Complaint (ECF 36) at 23 (Prayer). In other words, the Plaintiffs who were

franchisees sought a post hoc hearing procedure pursuant to their interpretation of the Dallas City Charter regarding the Ordinances alleged alteration of their franchise rights before the City could enforce the Ordinance. Granting Plaintiffs this relief would have mooted all their

constitutional claims and avoided the need to resolve them. The Courts failure to avoid constitutional issues has greatly prejudiced the Defendants. The hearings sought under the Dallas City Charter would present an opportunity for the City and Plaintiffs to resolve any of the conflicts which resulted in Plaintiffs claims under the Contract Clauses of the U.S. and Texas constitutions. Even if there was a procedural violation of the Dallas City Charter, the City could cure the infirmity by holding the hearing that Plaintiffs have demanded so the constitutional issues could be rendered moot or presented in a wholly different posture to this Court.

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For this reason, Defendants request a new trial which will give the Court an opportunity to properly decide the non-constitutional issues first in accordance with the fundamental rule of constitutional avoidance. B. The Order is manifestly erroneous because it fails to show proper deference to a democratically-elected legislature in favor of an improperly applied and unspecified heightened level of scrutiny. Under the Due Course of Law Clause of the Texas Constitution (art. I, 19), legislation is reviewed under rational basis scrutiny with a strong presumption of constitutionality. See Univ. of Texas Med. Sch. at Houston v. Than, 901 S.W.2d 926, 929 (Tex. 1995) (equating the federal and state constitutional standards for substantive due process review); In re Hinterlong, 109 S.W.3d 611, 626 (Tex. 2003) (courts are to strong[ly] presume that legislative enactments are constitutional under the Texas Constitution).2 It was clear even before Erie was decided that in federal tribunals, state courts are the ultimate authority regarding interpretation of state statutes and constitutionality.3 The Order fails to apply the level of scrutiny and deference demanded by Texas law for Plaintiffs Due Course of Law claims. But even under federal law, only a deferential rational basis standard for testing the Ordinance is proper. As an exercise of the police power, an ordinance is presumed to be

In Hinterlong, the Texas Supreme Court reiterated its long-held position that: A strong presumption exists that a valid legislative enactment is constitutional. Therefore, in analyzing the constitutionality of a statute, we begin with a presumption that the statute is constitutional and that the legislature has not acted unreasonably or arbitrarily. Under Texas law, a home-rule citys ordinance gets the same presumption of constitutionality and deference as a statute. To be sure, [a]n extraordinary burden rests on one attacking a city ordinance. City of Coll. Station v. Turtle Rock Corp., 680 S.W.2d 802, 805 (Tex. 1984) (citation omitted); see also Quick v. City of Austin, 7 S.W.3d 109, 117 (Tex. 1998) (extraordinary burden requires showing that no conclusive or even controversial or issuable fact or condition existed that would authorize the passage of the ordinance"); City of Brookside Village v. Comeau, 633 S.W.2d 790, 792 (Tex. 1982) (The courts have no authority to interfere unless the ordinance is unreasonable and arbitrarya clear abuse of municipal discretion.) 3 See Johnson v. Fankell, 520 U.S. 911, 916 (1997) (Neither [the Supreme Court] nor any other federal tribunal has any authority to place a construction on a state statute different from the one rendered by the highest court of the State.); Steele v. G. D. Searle & Co., 483 F.2d 339, 343 (5th Cir. 1973) ([N]ot even our justified deference to the conclusions of the district court can be permitted to obscure the explicit command of Erie R.R. v. Tompkins, 1938, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, that the authoritative legislative and judicial tribunals of the states are the ultimate instructors of the federal courts on matters of state law.). DEFENDANTS MOTION FOR NEW TRIAL WITH SUPPORTING BRIEF Page 5

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constitutional. See Goldblatt v. Town of Hempstead, 369 U.S. 590, 596 (1962); see also United States v. Carolene Prods. Co., 304 U.S. 144, 154 (1938). An ordinance must be upheld if any facts either known or reasonably assumed will support it. Goldblatt, 369 U.S. at 596; Brewster v. City of Dallas, 703 F.Supp. 1260, 1263-64 (N.D. Tex. 1988); see also Carolene Prods. Co., 304 U.S. at 154 (1938). Here, the parties and this Court appear to agree that the Flow Control Ordinance itself sets forth a list of laudable goals, including: (1) deterring illegal dumping of solid waste; (2) increasing recycling; (3) ensuring the safe and proper handling of solid waste within the City; (4) providing for cost-efficient solid waste management; and (5) facilitating the development of data on solid waste management. See, e.g., Order at 14. Instead of giving these goals as recited in the Ordinance the only competent evidence of what the City Council as a legislative body as a whole intended the Court instead erroneously chose to give more weight to statements of individual Councilmembers (without proper context) and a non-Councilmember (then-Directorof-Sanitation Mary Nix). In doing so, the Court improperly delved into the sincerity of certain Councilmembers and imputed select portions of their statements and a non-Councilmember statements to the entire City and its Council.4 Moreover, the Court failed to find that the Flow Control Ordinance would not result in the City achieving the plainly-stated goals. Accordingly, the Court cannot conclude that the City Council was unreasonable or arbitrary. None of the cases cited in the Order, including Tex. Power & Light Co. v. City of Garland, 431 S.W.2d 511 (Tex. 1968), support a standard of review that would place the

See In re Davis, 170 F.3d 475, 480 (5th Cir. 1999) (Isolated statements of individual legislators represent neither the intent of the legislature as a whole nor definitive interpretations of the language enacted by Congress.); Board of Educ. v. Rowley, 458 U.S. 176, 204 n. 26 (1982)); U.S. v. Union Pac. R. Co., 91 U.S. 72, 79 (1875) (In construing an act of Congress, we are not at liberty to recur to the views of individual members in debate, nor to consider the motives which influenced them to vote for or against its passage. The act itself speaks the will of Congress, and this is to be ascertained from the language used.). Page 6

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statements of a non-elected department director above those of the democratically-elected legislature as expressed in a legislative enactment. None of the cases cited in the Order support a standard of review that would give more weight to certain out-of-context statements of City Councilmembers, and less weight to the plainly-stated goals in the Flow Control Ordinance itself. None of the cases cited in the Order support a standard of review that fails to delve into whether the plainly-stated goals in the Flow Control Ordinance are unreasonable or arbitrary.5 Instead, it appears that the Court has developed an improper and unsupported heightened standard of review for claims under the Due Course of Law Clause.6 The Order thus ignored the Supreme Courts warning that substantive constitutional review is not a roving license for federal courts to decide what activities are appropriate for state and local government to undertake, and what activities must be the province of private market competition. See United Haulers, 550 U.S. at 343 (reviewing flow control under the Commerce Clause). Application of the proper standard would have resulted in a decision favorable to Defendants on the Due Course of Law issue. For these reasons, Defendants request a new trial in which (if necessary after ruling on non-constitutional issues first) the Court gives due deference to the Citys democratically-elected legislature, and properly makes a finding on whether the

In addition, none of the cases cited in the Order or in any pleadings or briefs supports the contention that it is improper for a City Council or City employees to consider City revenue in making decisions. The City believes that if the Court applied the correct standard of review, the conclusion in the Order that Mayor Rawlings and other City Council members heavily emphasized the revenue-raising aspects of the Flow Control Ordinance is wholly irrelevant, except to the extent that it shows additional funds would be available to achieve the goals plainly set forth in the Flow Control Ordinance. See Order at 15. Moreover, the U.S. Supreme Court has found that flow control was, indeed, a financing tool[]. United Haulers Ass'n, Inc. v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U.S. 330, 346 (2007). 6 Similarly, the City previously disagreed with the Courts use of a heightened level of scrutiny under the Contracts Clause of the U.S. Constitution in the Order (Docket No. 53) granting Plaintiffs application for a temporary injunction. The Court adopted this incorrect analysis in its present Order. For the reasons discussed in Defendants Response in Opposition to Permanent Injunction (Docket No. 73) at 21-9 & fn. 13 including the fact that the no case law supports application of such a high level of scrutiny Defendants re-urge their request that the Court apply the proper level of scrutiny in a new trial. DEFENDANTS MOTION FOR NEW TRIAL WITH SUPPORTING BRIEF Page 7

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City Council acted reasonably in passing the presumptively-constitutional Flow Control Ordinance to achieve the clearly stated goals outlined in the ordinance itself. C. The Order is manifestly erroneous because it improperly enjoins criminal prosecution in state court. Federal courts should not enjoin the enforcement of local penal laws because the right to defense in criminal prosecution is an adequate remedy at law. Boyle v. Landry, 401 U.S. 77, 81 (1971); Dombrowski v. Pfister, 380 U.S. 479, 490-91 (1965) (distinguishing between abatement and traditional equity injunction considerations); Stefanelli v. Minard, 342 U.S. 117, 122 (1951); Douglas v. City of Jeannette, 319 U.S. 157, 163 (1943) (Stone, J.). Similarly, a federal court should abstain from hearing a federal constitutional case where the constitutional issue might be mooted or presented in a different posture by a state court determination. Edwards v. Sammons, 437 F.2d 1240, 1242 (5th Cir. 1971) (describing Pullman abstention) (citations omitted). The Order specifically finds that the Franchisee[] [Plaintiffs] face a real and immediate threat of fines and criminal penalties. Order at 33. In addition, on the basis of facing serious criminal sanctions for noncompliance, the Order finds that Plaintiffs have shown immediate, irreparable harm. . . . Id. at 33-4. The Order is manifestly erroneous for two reasons. First, defense from criminal prosecution in the Texas state court is an adequate remedy at law to the threat of fines and criminal penalties identified by the Court. See Boyle, 401 U.S. at 81. Second, the determination at the state-court level will moot Plaintiffs claims or alter the posture of the parties, so it is inappropriate for the Court to grant the broad injunctive relief requested by Plaintiffs at this time. See Edwards, 437 F.2d at 1242. Based on well-established case law and the Courts finding that criminal prosecution was imminent, it is appropriate for the federal court to abstain from reviewing the legality of the Flow Control Ordinance in favor of allowing a Texas state court to adjudicate an actual criminal prosecution. For this reason, Defendants

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request a new trial in which the Court properly considers whether a grant of injunctive relief is appropriate under the circumstances. D. The Order is manifestly erroneous because it improperly identifies the applicable dates and parties for the injunctive relief. Even if Franchisee Plaintiffs and other franchisees are entitled to the relief granted by the Order (which they are not), the wording of the injunction relief in the Order is materially and prejudicially incorrect for three reasons. The Order states that the City is enjoined from

enforcing Dallas City Ordinance No. 28427 [the Flow Control Ordinance] against Franchisees in this lawsuit and other franchisees who entered into franchise agreements with the City prior to the date of this decision. Order at 37. First, the Order is manifestly erroneous because it incorrectly establishes a late date for the commencement of injunctive relief. Based on the rationale stated by the Court, the proper date should be, at the latest, the date that the City adopted the Flow Control Ordinance, not the date of the Order. Franchisees executing

agreements with the City after the enactment of the Flow Control Ordinance had full knowledge that the ordinance had been enacted, and are not subject to the same treatment under the Courts Contracts Clause and Due Course of Law analysis. Second, the injunction in the Order should specify that the franchise agreements referenced are only franchise agreements for valid waste haulers, and not invalid waste hauling franchise agreements or any of the other franchise agreements into which the City (many of which are not waste related) may have entered. Indeed, under the rationale used in the Order, enforcement can only be enjoined as to valid waste hauling franchises that commenced on the earlier of: (1) the date of the public City Council briefing on flow control on June 15, 2011; or (2) the earliest date(s) on which each of the franchisee Plaintiffs received actual knowledge of the Flow Control Ordinance proposal, because after that date any would-be franchisee would have reasonably anticipated that its franchise could be

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subject to flow control.7

Third, the injunction against enforcement of the Flow Control

Ordinance against other franchisees is overly broad and unsupported by any evidence if applied to those who happen to have unrelated franchise agreements from the City (for example a natural gas service franchise) but who seek to haul solid waste for whatever reason within the City. The City must be permitted to enforce the Ordinance against them. For these reasons, the injunction in the Order is not supported by the Order itself, and should be vacated and a new trial granted or, at a minimum, the Order should be revised to properly reflect the intended ruling of the Court. IV. CONCLUSION

For the foregoing reasons, the Court should vacate the Order and Final Judgment and proceed with a new trial.

Respectfully submitted, THOMAS P. PERKINS, JR., CITY ATTORNEY OF THE CITY OF DALLAS, TEXAS /s/ James B. McGuire Peter B. Haskel Executive Assistant City Attorney Texas Bar No. 09198900 Christopher D. Bowers First Assistant City Attorney Texas Bar No. 02731300 James B. McGuire Assistant City Attorney Texas Bar No. 24055939 Christopher J. Caso Senior Assistant City Attorney Texas Bar No. 03969230 City Hall 7BN
See Order at 9-10 (adopting objective expectation standard for standing to challenge Ordinance); Defendants Response to Motion for Preliminary Injunction at 6 (ECF 16) (identifying June 15, 2011 public briefing of Ordinance). DEFENDANTS MOTION FOR NEW TRIAL WITH SUPPORTING BRIEF Page 10
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1500 Marilla Street Dallas, TX 75201 Tel.: (214) 670-3519 Fax: (214) 670-0622 peter.haskel@dallascityhall.com chris.bowers@dallascityhall.com chris.caso@dallascityhall.com james.mcguire@dallascityhall.com ATTORNEYS FOR DEFENDANTS

CERTIFICATE OF SERVICE I hereby certify that on November 13, 2012, an electronic copy of the foregoing Motion for New Trial was filed with the Clerk of Court for the U.S. District Court for the Northern District of Texas, using the Courts CM/ECF system. I further certify that all participants in the case are registered CM/ECF users and that service will be accomplished by the CM/ECF system.

/s/ James B. McGuire James B. McGuire

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