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11th Cir.: Intrastate Travel Of SuperShuttle Drivers Satisfied Motor Carrier Act Exemption, Because Many Customers Were “Through Ticketed” Based On Internet Travel Packages
Abel v. Southern Shuttle Services, Inc.
This case was before the Eleventh Circuit for the second time. Plaintiff, a former driver of Defendant Southern Shuttle Services, Inc.’s airport shuttle vans, filed the action under the FLSA seeking unpaid overtime pay. In the first appeal, the Eleventh Circuit vacated the district court’s entry of summary judgment in Southern Shuttle’s favor because Southern Shuttle’s airport shuttle service did not fall within the “taxicab exemption” to the FLSA’s overtime provisions. See Abel v. S. Shuttle Servs., Inc., 301 F. App’x 856 (11th Cir.2008). After remand, Southern Shuttle filed a second motion for summary judgment, arguing that its airport shuttle van drivers fall under the Motor Carrier Act exemption in 29 U.S.C. § 213(b)(1). The district court agreed and granted Southern Shuttle summary judgment. On appeal, the Eleventh Circuit affirmed.
The Court outlined the following facts pertinent to its inquiry:
“Southern Shuttle operates a shared-ride airport shuttle, known as “SuperShuttle,” that transports passengers to and from three South Florida airports (Miami International Airport, Palm Beach International Airport and Fort Lauderdale-Hollywood International Airport). From December 19, 2005 to June 24, 2007, Abel worked for Defendant Southern Shuttle as a shuttle driver, driving passengers to and from airports. Abel, like all shuttle drivers, was paid commission and tips, but not overtime compensation. Abel’s employment ended after he refused to transport a passenger with a payment voucher and made the passenger exit the shuttle van, in violation of Southern Shuttle’s policy.
The shuttles are large nine- and ten-person passenger vans. The shuttles pick up passengers at one of the airports and take them to any location in the area (such as a residence, office or hotel), or pick them up at any location in the area and take them to one of the airports. Shuttle drivers do not transport passengers to or from locations outside of Florida. Some shuttle passengers are transported to the airports so they can travel via air carrier to other states or countries. Other shuttle passengers are transported from the airports after having flown from other states or countries.
Many shuttle passengers arrange for shuttle transportation by contacting Southern Shuttle directly. Passengers traveling to the airport make reservations ahead of time and schedule a trip to the airport. Similarly, passengers traveling from the airport check in at a SuperShuttle airport kiosk or counter or with a curbside representative to be assigned to the next available shuttle.
Southern Shuttle’s president, Mark Levitt averred that: (1) “[a] large portion of the reservations made with Southern Shuttle are through internet package deals wherein a traveler buys a package deal from a third party company that includes airfare, hotel accommodations and transportation to and from the airport”; (2) “the traveler receives a voucher for free transportation to and from the airport and provides the voucher to Southern Shuttle in lieu of payment”; and (3) “Southern Shuttle then prepares an invoice to the third party company for payment.” These third party companies include internet travel web sites such as Expedia.com, Travelocity, Orbitz, CheapTickets, a German company called Viator, a company in the United Kingdom called Get a Bed, and American Express, among others.”
Affirming the lower court’s decision, the Eleventh Circuit reasoned:
“[T]he Supreme Court’s Morris decision involved a general cartage business that primarily transported steel around the Detroit area either within local steel plants or to and from local steel plants. 332 U.S. at 427, 68 S.Ct. at 133. A small percentage of the employer’s trips, roughly four percent, involved transporting miscellaneous freight to and from Detroit boat docks, railroad depots and freight terminals. Id. at 427 & n. 7, 68 S.Ct. at 133 & n. 7. Although these trips did not cross state lines, they nonetheless met the de minimus interstate commerce requirement because they transported freight “in interstate commerce, either as part of continuous interstate movements or of interstate movements begun or terminated in metropolitan Detroit.” Id. at 427, 432-33, 68 S.Ct. at 133, 136.
Other cases make clear that trips within a single state are made in interstate commerce when they are part of “a practical continuity of movement of the goods” in interstate commerce. Walling v. Jacksonville Paper Co., 317 U.S. at 568, 63 S.Ct. at 335 (involving wholesale distributor of paper products made outside the state but transported only to customers within the state); see also Baez, 938 F.2d at 181-82 (involving armored trucks delivering to Florida banks checks and other instruments bound for banks outside Florida); Galbreath v. Gulf Oil Corp., 413 F.2d 941 (5th Cir.1969) (involving oil company’s transport within Georgia of petroleum products originating from refineries in Texas and Mississippi); Opelika Royal Crown Bottling Co. v. Goldberg, 299 F.2d 37 (5th Cir.1962) (involving wholesale soft drink distributor transporting drinks bottled in Georgia from Alabama warehouse to Alabama customers and returning empty bottles to Alabama warehouse, where other trucks took them back to Georgia).
The Third Circuit distinguished the transportation of passengers from goods. See Packard v. Pittsburgh Transp. Co., 418 F.3d 246 (3d Cir.2005). The employer in Packard provided transportation to the elderly and disabled in Allegheny County, which included trips to train and bus stations and to the airport. Id. at 248-49. The Third Circuit concluded that this transportation service did not fall within the Secretary’s jurisdiction because it was not “in practical continuity with a larger interstate journey.” Id. at 258. Because Morris involved transportation of goods not passengers, the Third Circuit looked at cases arising in other contexts that defined interstate transportation of passengers, including United States v. Yellow Cab Co., 332 U.S. 218, 67 S.Ct. 1560, 91 L.Ed. 2010 (1947), overruled on other grounds by Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 104 S.Ct. 2731, 81 L.Ed.2d 628 (1984), a Sherman Act case.
In Yellow Cab, the Supreme Court described interstate commerce as “an intensely practical concept drawn from the normal and accepted course of business.” Id. at 231, 67 S.Ct. at 1567. Because “the limits of an interstate shipment of goods” may be different than “the commonly accepted limits of an individual’s interstate journey,” courts must “mark the beginning and end of a particular kind of interstate commerce by its own practical considerations.” Id. In light of these practical considerations, the Supreme Court concluded that, “in the absence of some special arrangement,” a taxi ride to or from a railroad station at the beginning or end of an interstate journey ordinarily is a local trip that is not within interstate commerce. Id. at 231-32, 67 S.Ct. at 1567. However, where the railroad “contract[s] with the passengers to supply between-station transportation in Chicago,” the taxi ride “is clearly a part of the stream of interstate commerce.” Id. at 228, 67 S.Ct. at 1565-66. The Supreme Court explained that “[w]hen persons or goods move from a point of origin in one state to a point of destination in another, the fact that a part of that journey consists of transportation by an independent agency solely within the boundaries of one state does not make that portion of the trip any less interstate in character.” Id. at 228, 67 S.Ct. at 1566.
Relying on the distinctions drawn in Yellow Cab, the Third Circuit noted that the transportation of the elderly and disabled in Packard “involves no joint fare or ticketing arrangement, and no prior arrangement of any kind, contractual or otherwise, with the railroads, airlines, or other companies.” Packard, 418 F.3d at 258. The Third Circuit cited “through ticketing” as “one example of a common arrangement involving both intra and interstate portions of passenger transport” but concluded that it was “not the only means of establishing that passenger transport operating intrastate is in practical continuity with a larger interstate journey.” Id. (emphasis omitted). Highlighting the “lack of coordination with other transportation,” such as through “a prepackaged tour,” the Third Circuit concluded that the transportation service in Packard was “purely intrastate.” Id.
4. Southern Shuttle
Guided by the interstate commerce principles in Walters, Morris and Yellow Cab, we conclude that the purely intrastate transport of passengers to and from an airport may, under certain circumstances, constitute interstate commerce and thus bring the transportation company within the jurisdiction of the Secretary of Transportation. Those circumstances are present here.
Many of Southern Shuttle’s passengers to and from the airport have either just flown from, or are about to fly to, places outside the state of Florida. A large portion of Southern Shuttle’s reservations are made via travel websites on the internet. Travelers buy package deals from these internet travel companies that include hotel accommodations and airfare in addition to transportation to and from the airport. The internet travel companies provide their package-deal customers with a voucher for free airport transportation, which the customers use to board Southern Shuttle’s airport shuttles. Southern Shuttle then uses the collected vouchers to invoice the internet travel company for payment. In other words, Southern Shuttle’s local transport of these package-deal travelers has a “practical continuity of movement” with the overall interstate journey.
Furthermore, Southern Shuttle’s arrangement with internet travel companies to provide airport shuttle service for their package-deal customers meets the “common arrangement” requirement discussed in Walters. Indeed, Southern Shuttle’s voucher system resembles in many respects the voucher system the bus company used for cruise ship passengers in Walters. In sum, we conclude that Southern Shuttle has shown that it is subject to the Secretary of Transportation’s jurisdiction under the MCA.
C. Secretary’s MCA Jurisdiction over Abel’s Work-Related Activities
We next address the second requirement: whether the Secretary’s jurisdiction extends to Abel’s work-related activities at Southern Shuttle. To satisfy this requirement, Southern Shuttle must show that Abel “engage[d] in activities of a character directly affecting the safety of operation of motor vehicles in the transportation on the public highways of passengers or property in interstate or foreign commerce within the meaning of the Motor Carrier Act.” 29 C.F.R. § 782.2(a). Abel does not dispute that, as an airport shuttle driver, he engaged in activities that directly affected the safety of operation of motor vehicles in the transportation of passengers on the public highways. Thus, the only issue presented is whether Abel’s activities as an airport shuttle driver constituted “interstate commerce” within the meaning of the MCA. Here, the issue is easily resolved because Abel performed Southern Shuttle’s core airport shuttle transport activity. Having already concluded that Southern Shuttle’s airport shuttle service was transportation of passengers in interstate commerce that subjected it to the Secretary’s jurisdiction, we conclude that Abel’s activities in driving the airport shuttle also constitute interstate commerce.”
To read the entire decision, click here.
11th Cir.: Bus Drivers Exempt From FLSA Under Motor Carrier (MCA) Exemption; Bus Company’s Airport-to-Seaport Shuttle Routes Shared A Practical Continuity Of Movement Due To Interstate Travel Of Cruise Line Customers Shuttled
Walters v. American Coach Lines Of Miami, Inc.
This appeal required the Court to determine whether Appellants, who are all current or former bus drivers for American Coach Lines of Miami (“ACLM”), were subject to a provision in the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq., exempting from the FLSA’s overtime requirements any employees who fall under the jurisdiction of the Secretary of Transportation under the Motor Carrier Act (“MCA”). The district court found Appellants to be eligible for this “motor carrier” exemption and therefore granted the portion of ACLM’s motion for summary judgment addressing Appellants’ claims for overtime wages. After reviewing the record and the parties’ briefs and hearing oral argument, we AFFIRM the grant of summary judgment.
The Court stated the relevant facts to its inquiry as follows:
“ACLM is a private motor carrier providing for-hire ground transportation for passengers that holds itself out to be an “interstate” motor carrier. It is licensed with the United States Department of Transportation (“DOT”), holds all the authorizations from the Federal Motor Carrier Safety Administration (“FMCSA”) necessary to be an interstate passenger motor carrier, and has been issued a DOT number. Since 2004, federal transportation agencies have audited ACLM at least twice, on at least one occasion in combination with Florida authorities. ACLM also requires its drivers to meet DOT safety standards, which Florida has adopted as well. See
Fla. Stat. § 316.302. ACLM does not pay its drivers overtime wages.
ACLM primarily provides transportation within the state of Florida, though some of its business is between Florida and other states. Much of ACLM’s revenue comes from shuttling cruise ship passengers between the Miami and Fort Lauderdale airports and local hotels and cruise ship ports. Since September 2006, ACLM has had a written contract to be the sole provider of such transportation for Royal Caribbean Cruise Lines (“Royal Caribbean”) during daytime hours. ACLM asserts that between April 2006 and December 2007 it transported more than 500,000 Royal Caribbean passengers, trips that resulted in over $4.4 million in revenues. Appellants contend that there is no proof that ACLM provided such transport prior to September 2006, though they appear not to dispute the total revenue figure. In addition to this written arrangement with Royal Caribbean, ACLM maintains that it earned over $700,000 from earlier informal agreements to provide similar shuttle transportation for Costa Cruises and Princess Cruises. Appellants likewise dispute the existence of such arrangements.
Under ACLM’s contract with Royal Caribbean, it provides ground transportation for passengers who book vacation packages through travel agents or Royal Caribbean. For those passengers, ground transportation is included as part of the overall package and is not priced or itemized separately. Passengers who do not pre-purchase ground transportation can request shuttle service when they arrive at the airport or cruise ship terminal, which will then be charged to that passenger’s Royal Caribbean account. Under the agreement, Royal Caribbean provides ACLM with weekly manifests listing the expected time, date, and number of passengers for each shuttle trip. Royal Caribbean employees greet passengers on arrival, contact ACLM when a bus is required, and collect vouchers from passengers before they board the bus. Royal Caribbean does not keep the vouchers nor does it give them to ACLM; rather, it gives ACLM a “load slip” with a head count for each trip. ACLM then uses these load slips to invoice Royal Caribbean for the trips. The agreement stated that ACLM would receive payment only if a passenger actually boarded the bus, with Royal Caribbean deciding whether to pay based on a per-person or per-bus rate. FN2 As a result, ACLM receives all of its payments from Royal Caribbean, rather than the passengers.
In addition to these local shuttle services, ACLM also provided other forms of in-state and out-of-state motor coach transportation, including driving shuttle bus routes at the University of Miami. Between 2004 and 2007, ACLM drivers made at least 148 trips that involved out-of-state travel, some for as long as 90 days. Both parties agree that approximately $1.7 million, or 4.06% of ACLM’s total revenue during that period, came from these out-of-state trips and that about 19% of its drivers made such trips. There appear to have been 75 ACLM drivers who made out-of-state trips during the time frame, which constitutes 19.08% of the 393 drivers employed by ACLM for that period.FN5 Nine of the 63 Appellants (14.29%) made out-of-state trips for ACLM, and Appellants spent less than 286 days on such trips during the period in question. ACLM does not keep records of how many trips its drivers make on a daily or annual basis, and there is no solid evidence regarding how many overall trips ACLM drivers made between 2004 and 2007 nor of what percentage of those trips involved out-of-state travel. One ACLM executive agreed that 10,000 total trips a year would be a reasonable estimate. He stated that, if this estimate were correct, then around 100 of those trips would involve out-of-state travel, which would mean that approximately 1% of ACLM’s total trips were out of state.”
After finding that the Defendant was a “motor carrier” the Court turned its inquiry to that of whether Plaintiffs were covered by the MCA. “Courts are ‘guided by practical considerations’ in determining whether an employee’s activities would be part of interstate commerce for purposes of the FLSA. Marshall v. Victoria Transp. Co., Inc., 603 F.2d 1122, 1123 (5th Cir.1979) (quotation marks and citation omitted). “When persons or goods move from a point of origin in one state to a point of destination in another, the fact that a part of that journey consists of transportation by an independent agency solely within the boundaries of one state does not make that portion of the trip any less interstate in character.”United States v. Yellow Cab Co., 332 U.S. 218, 228, 67 S.Ct. 1560, 1566, 91 L.Ed. 2010 (1947), overruled on other grounds by Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 104 S.Ct. 2731, 81 L.Ed.2d 628 (1984). As a result, purely intrastate transportation can constitute part of interstate commerce if it is part of a “continuous stream of interstate travel.” Chao v. First Class Coach Co., Inc., 214 F.Supp.2d. 1263, 1272 (M.D.Fla.2001). For this to be the case, there must be a “practical continuity of movement” between the intrastate segment and the overall interstate flow. Walling v. Jacksonville Paper Co., 317 U.S. 564, 568, 63 S.Ct. 332, 335, 87 L.Ed. 460 (1943); see also Bilyou v. Dutchess Beer Distribs., Inc., 300 F.3d 217, 223 (2d Cir.2002) (applying this standard in analyzing applicability of motor carrier exemption).
In Marshall, we addressed a city bus service in Brownsville, Texas, which often transported people who had walked across the Mexican border before boarding the bus. See Marshall, 603 F.2d at 1123-24. We characterized the transportation of people making international journeys as “a regular, recurring and substantial part” of the bus drivers’ overall workload. Id. at 1125. Because the drivers’ work thereby was “entwined with a continuous stream of international travel,” we concluded that the drivers were engaged in interstate commerce, even though their routes were solely intrastate. Id. The Supreme Court reached a similar conclusion in United States v. Capital Transit Co., 338 U.S. 286, 70 S.Ct. 115, 94 L.Ed. 93 (1949). That case involved a bus service that drove routes within the District of Columbia that took commuters to locations where they then could board buses bound for Virginia. See id. at 288, 70 S.Ct. at 116. The Court found that the Interstate Commerce Commission (“ICC”) had regulatory authority under the MCA over those intra-district bus routes because they were “part of a continuous stream of interstate transportation” and thus formed “an integral part of an interstate movement.” Id. at 290, 70 S.Ct. at 117.
These cases indicate that ACLM’s airport-to-seaport routes would come under the Secretary’s MCA jurisdiction. Its shuttle trips share a practical continuity of movement with the interstate or international travel of the cruise lines and their passengers, just as the Brownsville bus routes did for their riders’ cross-border journeys. For cruise ship passengers arriving at the airport or seaport, ACLM’s shuttle rides would be part of the continuous stream of interstate travel that is their cruise vacation. The Royal Caribbean patrons in particular would have no reason to have any alternate view since the fee for the shuttle ride would either be bundled as part of their cruise vacation package or would be included on the bill for their Royal Caribbean shipboard account.”
The Court shot down each of Plaintiffs arguments that they were not subject to the MCA. The Court said: (1) application of the MCA did not require travel in interstate trips; (2) the incidental-to-air exemption was inapplicable; and (3) Defendants were not required to have a “through-ticketing” arrangement with the cruise line to argue that the passengers were all moving in the continuity of interstate commerce.
Therefore, the Court found that under the circumstances, the bus drivers were not entitled to the benefits of the FLSA, because they were exempt under the Motor Carrier Act (MCA) exemption to the FLSA.