Amicus Curiae Brief — Malco Enterprises of Nevada, Inc., a Domestic Corporation, Petitioner v. Alelign Woldeyohannes

NO. 25-3

In the Supreme Court of the United States

MALCO ENTERPRISES OF NEVADA, INC.,

A DOMESTIC CORPORATION,

Petitioner,

v.

ALELIGN WOLDEYOHANNES,

Respondent.

__________________________

On Petition for a Writ of Certiorari to the

Supreme Court of Nevada

BRIEF OF AMICI CURIAE

AMERICAN FINANCIAL SERVICES ASSOCIATION,

NATIONAL AUTOMOBILE DEALERS ASSOCIATION,

ASSOCIATION OF CONSUMER VEHICLE LESSORS,

AND AMERICAN AUTOMOTIVE LEASING ASSOCIATION

IN SUPPORT OF PETITIONER

Kenneth F. Rossman, IV

WOMBLE BOND DICKINSON US LLP

1601 19th Street, Ste. 1000

Denver, CO 80202

(303) 623-9000

ken.rossman@wbd-us.com

Scott Hyman

Counsel of Record

WOMBLE BOND DICKINSON US LLP

400 Spectrum Center Dr., Ste. 1700

Irvine, CA 92618

(657) 266-1067

scott.hyman@wbd-us.com

July 18, 2025

SUPREME COURT PRESS

Counsel for Amici Curiae

♦

(888) 958-5705

♦

BOSTON, MASSACHUSETTS

i

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ....................................... ii

INTEREST OF THE AMICI CURIAE ....................... 1

INTRODUCTION AND SUMMARY OF

THE ARGUMENT ................................................ 3

ARGUMENT ............................................................... 6

I.

Vehicle Leasing Represents Significant

Economic Activity in the National Economy ...... 6

II. Congress Passed the Graves Amendment to

Implement a Nationwide Fix for a Problem

That Was Undermining the Economic Engine

of Vehicle Leasing ............................................ 7

III. The Nevada Supreme Court’s Ruling

Undermines the Protections Congress

Intended with the Graves Amendment,

Adversely Affects Consumers and Businesses,

and Endangers the Economic Viability of

the Vehicle Leasing Industry......................... 14

CONCLUSION.......................................................... 19

ii

TABLE OF AUTHORITIES

Page

CASES

TABLE OF AUTHORITIES

37 S. Fifth Ave. Corp. v. Dimensional Stone &

Tile, 66 N.Y.S.3d 774

(N.Y. App. Term. 2017) ..................................... 16

Enter. Rent-A-Car Co. of Bos., LLC

v. Maynard, No. 2:11-CV-00047-JAW,

2012 WL 1681970 (D. Me. May 14, 2012) .. 15, 16

Garcia v. Vanguard Car Rental USA, Inc.,

540 F.3d 1242 (11th Cir. 2008) ............. 13, 14, 15

Malco Enters. of Nevada, Inc.

v. Woldeyohannes, 559 P.3d 875

(Nev. 2024) ......................................... 5, 15, 16, 17

Martin v. Crook,

776 N.W.2d 110 (Iowa Ct. App. 2009) .............. 16

Meyer v. Nwokedi,

759 N.W.2d 426 (Minn. Ct. App. 2009) ...... 15, 16

Puerini v. Lapierre,

208 A.3d 1157 (R.I. 2019) .................................. 16

Rodriguez v. Testa,

993 A.2d 955 (Conn. 2010) .......................... 15, 16

Second Child v. Edge Auto, Inc.,

230 N.Y.S.3d 59 (N.Y. App. Div. 2025) ............. 16

Subrogation Div., Inc. v. Brown,

446 F.Supp.3d 542 (D.S.D. 2020) ................ 15, 16

Thayer v. Randy Marion Chevrolet Buick

Cadillac, LLC, 30 F.4th 1290

(11th Cir. 2022) ................................................. 13

iii

TABLE OF AUTHORITIES – Continued

Page

Vargas v. Enter. Leasing Co.,

60 So.3d 1037 (Fla. 2011) .................................. 16

Vasquez v. Christian Herald Ass’n Inc.,

588 N.Y.S.2d 291 (N.Y. App. Div. 1992) ............. 8

Wisconsin v. Mitchell,

508 U.S. 476 (1993) ........................................... 16

STATUTES

49 U.S.C. § 30106 .................................................. 3, 12

49 U.S.C. § 30106(a) ............................................. 4, 17

49 U.S.C. § 30106(b) ......................................... 4, 5, 17

Nev. Rev. Stat. § 482.305...................................... 5, 17

CONGRESSIONAL RECORD

151 Cong Rec. S5433–03

(daily ed. May 18, 2005) .................................... 12

151 Cong. Rec. H1200

(daily ed. Mar. 9, 2005) ......................... 10, 11, 12

Sen. Subcomm. On Comm., Sci., Transp.,

NHTSA Oversight: An Examination of the

Highway Safety Provisions of SAFETEA–

LU, 111th Cong. 84 (2010) .............................. 8, 9

OTHER AUTHORITIES

Bill Platt,

Leasing a Chrysler or Mercedes Will Cost

More in Four States, WALL STREET

JOURNAL, April 16, 2003 ................................... 10

iv

TABLE OF AUTHORITIES – Continued

Page

Business Council of New York State,

Vicarious liability costs New York

consumers and businesses millions (June

18, 2004), https://www.bcnys.

org/vicarious-liability-costs-new-yorkconsumers-and-businesses-millions ................. 10

Daniel J. Koevary,

Note, Automobile Leasing and the

Vicarious Liability of Lessors,

32 FORDHAM URBAN L.J. (2005) .......................... 9

Marc Santora,

Carmakers Limit New York Leases,

N.Y. TIMES, Apr. 24, 2004 ................................. 11

Melinda Zabritski,

Q4 2024, State of the Automotive Finance

Market, Experian (2025), https://www.

experian.com/content/dam/noindex/na/us/

automotive/finance-trends/2024/experiansafm-q4-2024.pdf ................................................. 7

Michael LaPlaca,

Graves Amendment Under Attack,

AUTO RENTAL NEWS (Jan. 1, 2008),

https://www.autorentalnews.com/146515/

graves-amendment-under-attack. ...................... 8

N.Y.’s Vicarious Liability Costly for Consumers

and Auto Dealers, INSURANCE JOURNAL

(July 19, 2004), https://www.

insurancejournal.com/magazines/magfeatures/2004/07/19/44590.htm .......................... 9

v

TABLE OF AUTHORITIES – Continued

Page

National Automobile Dealers Association,

2024 Annual Financial Profile of

America’s Franchised New-Car

Dealerships (2025), https://www.nada.org/

media/4695/download?inline ............................... 7

Susan Lorde Martin,

Commerce Clause Jurisprudence and the

Graves Amendment: Implications for the

Vicarious Liability of Car Leasing

Companies, 18 U. FLA. J.L. & PUB. POL’Y

(2007) ................................................................. 11

1

INTEREST OF THE AMICI CURIAE

The American Financial Services Association

(AFSA), the National Automobile Dealers Association

(NADA), the Association of Consumer Vehicle Lessors

(ACVL), and the American Automotive Leasing

Association (AALA) respectfully submit this brief as

amici curiae in support of Malco Enterprises of Nevada’s

Petition for a Writ of Certiorari.1

Founded in 1916, AFSA is the national trade association for the consumer credit industry, protecting

access to credit and consumer choice. AFSA members

provide consumers with many kinds of credit, including

traditional installment loans, mortgages, direct and

indirect vehicle financing, payment cards, and retail

sales finance. AFSA has a broad membership, ranging

from large international financial services firms to

single-office, independently owned consumer finance

companies.

For over 100 years, AFSA has represented financial

services companies that hold leadership positions in

their markets and conform to the highest standards of

customer service and ethical business practices. AFSA

supports financial education for consumers of all

ages. AFSA advocates before legislative, executive, and

judicial bodies on issues affecting its members’ interests,

1 Counsel for amici curiae affirm that by filing this brief more

than ten days before the deadline to file it, they have timely

notified all parties. No counsel for a party authored this brief in

whole or in part, and no counsel or party other than amici curiae,

their members, or their counsel made a monetary contribution

intended to fund the preparation or submission of this brief.

2

and many of its members participate in consumer and

commercial automobile and truck leasing.

For more than a century, NADA has been the

national voice of franchised new-car dealerships. Many

of its members engage in consumer and commercial

automobile and truck leasing. Founded in 1917, NADA

continues to work on behalf of its more than 16,000

members with all branches of government, car and

truck manufacturers, the media, and the public. NADA

advocates before legislative, executive, and judicial

bodies on issues affecting its members’ interests.

ACVL is a national trade association for the nation’s

largest consumer vehicle lessors, including captive and

non-captive finance companies, banks, credit unions,

and leasing companies. ACVL members originate most

of the consumer vehicle leases in the nation. ACVL seeks

to keep members informed on leasing industry developments and changes and to cover topics of member

interest, all with the highest levels of expertise and

integrity. ACVL includes experts in leasing from its

membership that serve as Board and Committee Chairs.

ACVL provides forums for members, including monthly

committee meetings, webinars and in person conferences.

AALA is a national trade organization that represents commercial automotive fleet leasing companies.

AALA members own and manage more than 3.5 million

vehicles, which are leased to small businesses, nonprofit organizations, government entities, and corporations that usually have smaller divisions or franchises

in all 50 states. These vehicles range from passenger

cars to cargo vans and trucks that are customized and

outfitted to fit business purposes, from electrical and

plumbing repair and telecommunications installation

3

to wholesale food and beverage distribution and fuel

delivery. Fleet leasing companies make businesses of

all sizes more competitive by allowing customers to

focus on their core business activities rather than

managing their vehicle fleets.

Amici have a significant interest in this case.

Many of their members engage in the commercial and

consumer vehicle leasing markets and rely on uniform

and predictable protections afforded the industry under

federal law. Although the decision on review involves

a rental car company, the Graves Amendment, and

the underlying concerns it addressed, apply equally to

companies that lease vehicles. The decision below

threatens this market and will act to chill that ability

of amici’s members to continue to provide these valuable

and highly desired services.

INTRODUCTION AND

SUMMARY OF THE ARGUMENT

Prior to passage of the Graves Amendment, vehicle

lessors faced an uneven patchwork of state laws

regarding vicarious liability. Those laws led many

lessors to withdraw from states imposing unlimited

vicarious liability on the owners of vehicles for the

negligence of lessees involved in accidents. In response,

in 2005, Congress passed the Graves Amendment, 49

U.S.C. § 30106, the purpose of which was to establish a

uniform, national approach to preserve vehicle leasing

in the United States. In the decision on review, however,

the Nevada Supreme Court incorrectly determined

that the Graves Amendment does not apply to state

4

laws imposing vicarious liability on rental and leasing

businesses unless they provide liability coverage for

the drivers of their vehicles in specified amounts. This

is a loophole that would eviscerate the Graves Amendment itself and countermand the language and purpose

of the Graves Amendment.

Under the Graves Amendment, Congress explicitly

preempted state vicarious liability laws: “An owner of

a motor vehicle that rents or leases the vehicle to a

person . . . shall not be liable under the law of any State”

for the negligence of renters or lessees. 49 U.S.C.

§ 30106(a). Section (b) of the statute excluded from this

federal preemption state “financial responsibility laws”:

(b) Financial Responsibility Laws.—Nothing in

this section supersedes the law of any State

or political subdivision thereof—

(1) imposing financial responsibility or insurance standards on the owner of a motor

vehicle for the privilege of registering

and operating a motor vehicle; or

(2) imposing liability on business entities

engaged in the trade or business of

renting or leasing motor vehicles for

failure to meet the financial responsibility

or liability insurance requirements under

State law.

49 U.S.C. § 30106(b).

Courts across the nation have repeatedly read

§ 30106(b) to merely preserve the ability of states to

enact laws requiring vehicle owners to maintain certain

levels of insurance as a condition of registering and

operating vehicles in the state.

5

In this case, a Nevada statute, Nev. Rev. Stat.

§ 482.305, imposes vicarious liability on rental car companies for the negligent acts of their customers unless

they ensure those customers have a minimum amount

of insurance coverage.2 Contrary to years of precedent

from courts across the nation, the Nevada Supreme

Court read § 30106(b) to exempt § 482.305 from preemption. Malco Enters. of Nevada, Inc. v. Woldeyohannes,

559 P.3d 875, 881 (Nev. 2024). This absurd result will

permit states to evade preemption of vicarious liability

altogether simply by incorporating the concept of

vicarious liability into their insurance requirements.

The Graves Amendment both preserves commerce

and continues the availability of leased vehicles to

consumers and businesses by rectifying the damage

that had developed in the transportation industry and

the American economy from the states that imposed

unlimited vicarious liability on non-negligent vehicle

owners for the actions of negligent drivers. The

Woldeyohannes decision undermines the very balanced

stability that consumers and businesses have enjoyed

during the two decades since the enactment of the

Graves Amendment.

2 Even though the Nevada statue itself applies only to short-term

(31 days or fewer) vehicles rentals, the Nevada Supreme Court’s

decision matters to companies involved in long-term leasing because

of its potential impact on how other courts will read § 30106(b).

6

ARGUMENT

I.

Vehicle Leasing Represents Significant

Economic Activity in the National Economy.

Vehicle leasing plays a crucial role in the U.S.

economy by meeting diverse consumer and business

needs, supporting the automotive industry, promoting

economic activity, and generating revenue. Commercial

vehicle leasing companies engaged in consumer leasing

are major purchasers of new vehicles, as well as commercial leasing to other businesses, which contributes

to the economy in important ways. Similarly, franchised

new vehicle dealers deliver a significant percentage

of new vehicles to their customers through consumer

leases, and commercial leases. This economic activity

helps sustain automotive production levels and supports

the manufacturing sector. The financial services companies that provide or facilitate consumer vehicles leases

also support the automotive ecosystem and its consumers by assisting those customers in acquiring the

vehicles they desire. And previously leased vehicles

often re-enter the market as used cars after the lease

term ends, well maintained and often with lower mileage

than purchased vehicles. Thus, vehicle leasing at leaseend provides a steady supply of quality, more affordable

vehicles for other consumers as well. Finally, consumer

and commercial vehicle leasing and the industries that

support it employ a large workforce, including dealers,

finance companies, sales staff, mechanics, customer

service representatives, and management personnel.

In addition to consumer leasing, commercial vehicle

leasing by small businesses or fleet leasing also is a

7

critical component of the U.S. economy. These arrangements provide businesses with significant flexibility

in managing capital expenditures while maintaining

modern fleets for their executives, employees, workers,

and contractors.

Quantitatively, vehicle leasing is an enormously

important part of the automotive industry—one quarter

of new vehicles acquired in 2024 were leased. Melinda

Zabritski, Q4 2024, State of the Automotive Finance

Market, Experian, 5 (2025), https://www.experian.com/

content/dam/noindex/na/us/automotive/finance-trends/

2024/experian-safm-q4-2024.pdf. Automotive sales are

a critical part of the U.S. economy. In 2024, there were

almost 16 million sales of new, light-duty vehicles. 2024

Annual Financial Profile of America’s Franchised

New-Car Dealerships, National Automobile Dealers

Association, 8 (2025), https://www.nada.org/media/4695/

download?inline. Last year, auto dealership advertising expenditures totaled $9.2 billion. Id. at 16. And

dealerships employed over 1 million individuals. Id. at

17. Consumer leasing plays a particularly significant

role in the burgeoning market for electric vehicles

(EVs). Over half of all new EVs acquired by individuals in 2024 were leased. Id. at 16.

II. Congress Passed the Graves Amendment to

Implement a Nationwide Fix for a Problem

That Was Undermining the Economic Engine

of Vehicle Leasing.

Prior to the 2005 enactment of the Graves Amendment, states created an increasingly growing problem

for the vehicle leasing industry. At least fourteen juris-

8

dictions3 had imposed vicarious liability on owners of

leased vehicles, holding non-negligent owners (i.e. vehicle lessors) liable for the negligence of lessees operating

the vehicles. A number of those states, including New

York, Connecticut, Iowa, and the District of Columbia,

exposed lessor/owners of leased vehicles to unlimited

liability.

This patchwork of varying state vicarious liability

laws left vehicle leasing companies in an untenable

position. Leasing companies were subjected to enormous

potential judgments,4 which they could neither anticipate nor economically avoid. Even leasing companies

leasing to lessees in states without vicarious liability

laws found themselves subject to enormous liability

due to their lessees driving the vehicle to a state that

permitted unlimited vicarious liability.

For leasing companies, as compared to rental

companies, the problem was particularly acute, given

the average lifespan of a vehicle lease is much longer

than the average length of a short-term rental agreement. NHTSA Oversight: An Examination of the

Highway Safety Provisions of SAFETEA–LU, Hearing

3 Arizona, California, Connecticut, Delaware, District of Columbia,

Florida, Idaho, Iowa, Maine, Michigan, Minnesota, Nevada, New

York, Oklahoma, Pennsylvania, Puerto Rico, and Wisconsin. Michael

LaPlaca, Graves Amendment Under Attack, AUTO RENTAL NEWS

(Jan. 1, 2008), https://www.autorentalnews.com/146515/gravesamendment-under-attack.

4 E.g. Vasquez v. Christian Herald Ass’n Inc. 588 N.Y.S.2d

291 (N.Y. App. Div. 1992) (applied New York’s vicarious liability

statute in an action by New York and Ohio passengers against

a Pennsylvania lessor of a van and a New York employer of the

lessee, arising out of a collision that occurred on the employer’s

property in Pennsylvania).

9

before the Subcomm. on Consumer Protection, Product

Safety, and Insurance of the S. Comm. on Commerce,

Science, and Transportation, 111th Cong. 84 (2010)

(“NHTSA Hearing”) (statement of Thomas James,

President & CEO, Truck Renting and Leasing Association). Automobiles are generally leased to consumers for

three to five years and to businesses for three years.

Id. Trucks are typically leased to businesses for one

to 5 years. Id. Especially over these periods of time,

the leasing company cannot control where the vehicle is

operated—and in what manner the vehicle is operated—

during the term of the lease. Lessors were exposed to

liabilities for which there was no reasonable method

for cost effective protection.

The situation created by vicarious liability laws,

and in particular unlimited liability, hamstrung the

industry. Indeed, small businesses found themselves

out of business due to tort exposure in states in which

they did not even operate. N.Y.’s Vicarious Liability

Costly for Consumers and Auto Dealers, INSURANCE

JOURNAL (July 19, 2004), https://www.insurancejournal.

com/magazines/mag-features/2004/07/19/44590.htm.

And larger businesses were forced to seek to limit exposure—albeit to limited effect—by refusing to do business

in certain states. Daniel J. Koevary, Note, Automobile

Leasing and the Vicarious Liability of Lessors, 32

FORDHAM URBAN L. J. 3, 105 (2005) (noting between

2001 and 2002, “there were over 215 vicarious liability

suits against [lessors], seeking a total of $1.6 billion”).

But because it is in the very nature of vehicles—and

for some commercial vehicles, the very purpose—to be

driven across state lines, there was no way for companies to effectively prevent this exposure.

10

This exposure to liability raised the costs associated with vehicle leasing to consumers and to businesses

both in terms of the cost of leasing itself and the

requirement that lessees maintain insurance that protected the lessor with significantly high limits. And, it

stifled commerce by often eliminating a financing source

of new vehicles for consumers and businesses. The

vicarious liability laws in this minority of states cost

the national industry $100 million a year nationwide,

not just in the states that had these laws, because the

law where the accident occurs typically governs, and

companies could not prevent their vehicles from being

driven across state lines. 151 Cong. Rec. H1200 (daily

ed. Mar. 9, 2005) (statement of Rep. Graves).

Customers were left with fewer affordable options

to lease a new car or truck. Because companies could

not obtain adequate insurance against vicarious liability

or because it became more uneconomical to do so,

companies that continued to lease cars raised their

fees by hundreds of dollars. Bill Platt, Leasing a

Chrysler or Mercedes Will Cost More in Four States,

WALL STREET JOURNAL, April 16, 2003, at D7. In 2003

and 2004, 200,000 leasing consumers were estimated

to pay an average additional acquisition fee of $524.88

each, or a total of $105 million more to lease a car in

New York due to the vicarious liability law. NHTSA

Hearing at 107 (prepared statement of NADA). The

situation led to a thirty-six percent decline in the

number of vehicles leased in New York, according to

one study. Vicarious liability costs New York consumers

and businesses millions, Business Council of New York

State (June 18, 2004), https://www.bcnys.org/vicariousliability-costs-new-york-consumers-and-businessesmillions; see also Marc Santora, Carmakers Limit New

11

York Leases, N.Y. TIMES, Apr. 24, 2004, at A1. Indeed,

many financial firms stopped leasing cars in New York

altogether. Susan Lorde Martin, Commerce Clause

Jurisprudence and the Graves Amendment: Implications

for the Vicarious Liability of Car Leasing Companies,

18 U. FLA. J.L. & PUB. POL’Y 153, 154 (2007).

Congress responded, passing the Graves Amendment to provide a uniform national standard to address

this situation, and particularly the problems inherent

in the interstate nature of leasing. Congress was aware

that the vicarious liability patchwork was damaging

the transportation industry and the American economy

as a whole. In 2005, Representative Sam Graves introduced a measure “to correct an inequity in the car and

truck renting and leasing industry.” 151 Cong. Rec.

H1200 (statement of Rep. Graves). This became the

“Graves Amendment.”

Members of Congress explained the purpose of

the Graves Amendment was to ‘‘establish a fair

national standard for liability.’’ 151 Cong. Rec. H1200

(statement of Rep. Blunt); see also H1202 (statement

of Rep. Smith) (purpose was to “create a national

standard’’).

Though only a few States enforce laws that

threaten nonnegligent companies with unlimited vicarious liability, they affect consumers

and businesses from all 50 States. Vicarious

liability means higher consumer costs in acquiring vehicles and buying insurance and means

higher commercial costs for the transportation

of goods. Left unreformed, these laws could

have a devastating effect on an increasing

number of small businesses that have done

nothing wrong.

12

151 Cong Rec. S5433–03 (daily ed. May 18, 2005)

(statement of Sen. Santorum).

Members of Congress stated they believed they

were adopting a rule that was fair both to motor vehicle

owners and accident victims: It would eliminate liability for actions where the motor vehicle operator was

not actually at fault, but leave state actions for negligence (e.g., negligent maintenance or entrustment)

intact. See 151 Cong. Rec. H1200 (statement of Rep.

Graves) (‘‘I want to emphasize, I want to be very clear

about this, that this provision will not allow car and

truck renting and leasing companies to escape liability

if they are at fault’’); H1202 (statement of Rep. Smith)

(‘‘The Graves[] amendment . . . provide[s] that vehicle

rental companies can only be held liable in situations

where they have actually been negligent. This amendment in no way lets companies off the hook when they

have been negligent.”).

In 2005, Congress passed the Graves Amendment,

and it became law. Act of Aug. 10, 2005, Pub. L. No.

109-59, Title X, § 10208(a), 119 Stat. 1935 (codified as

amended at 49 U.S.C. § 30106). Five years later, Congress entertained, and rejected, a motion to repeal the

Graves Amendment.

As the Court of Appeals for the Eleventh Circuit

explained:

Congress rationally could have perceived strict

vicarious liability for the acts of lessees as a

burden on that market. The reason it could

have done so is that the costs of strict vicarious liability against rental car companies are

borne by someone, most likely the customers,

owners, and creditors of rental car companies.

13

If any costs are passed on to customers,

rental cars . . . become more expensive, and

interstate commerce is thereby inhibited.

Moreover, if significant costs from vicarious

liability are passed on to the owners of rental

car firms, it is possible that such liability

contributes to driving less-competitive firms

out of the marketplace, or inhibits their

entry into it, potentially reducing options

for consumers.

Garcia v. Vanguard Car Rental USA, Inc., 540 F.3d

1242, 1253 (11th Cir. 2008) (emphasis in original).

And it worked. Following passage of the Graves

Amendment, leasing stabilized, and new programs

were developed. For example, participation in dealer

programs providing loaner cars to customers while

their primary vehicles were being serviced increased

sixty-seven percent in New York and forth-two percent

nationally. NHTSA Hearing at 109 (prepared statement of the NADA); see also Thayer v. Randy Marion

Chevrolet Buick Cadillac, LLC, 30 F.4th 1290, 1294

(11th Cir. 2022) (holding Graves Amendment applies

to vehicle provided by dealer to customer while that

customer’s car was being serviced). Most of the leasing

companies that had withdrawn from unlimited liability

states—like New York—came back. And nationally, auto

and truck leasing increased, resulting in more affordable

leasing terms for customers and small businesses.

14

III. The Nevada Supreme Court’s Ruling Undermines the Protections Congress Intended

with the Graves Amendment, Adversely

Affects Consumers and Businesses, and

Endangers the Economic Viability of the

Vehicle Leasing Industry.

The Nevada Supreme Court’s decision will undermine the very stability provided to the industry by the

Graves Amendment for over twenty years and will

imperil the growth detailed above.

The Graves Amendment has been challenged by

those seeking to foist unlimited liability on lessors.

Federal and State courts, however, have universally

rejected those challenges and upheld the clear text of

the statute. In an important, early decision, the Court

of Appeals for the Eleventh Circuit set the tone on the

breadth of preemption under the statute, rejecting the

argument that a Florida law imposing strict liability

on rental car companies was not preempted because

the law fell within the Graves Amendment’s exemption for a “financial responsibility law.” Garcia, supra,

540 F.3d at 1249.

The Court of Appeals instead concluded that the

Graves Amendment’s exemption from preemption for

“financial responsibility laws” meant “insurance-like

requirements on owners or operators of motor vehicles,”

not the unlimited liability provisions of Florida law.

Id. at 1247. The court explained:

States may require insurance or its equivalent

as a condition of licensing or registration, or

may impose such a requirement after an

accident or unpaid judgment. . . . They may

suspend the license and registration of, or

15

otherwise penalize a car owner who fails to

meet [these] requirement[s]. . . . They simply

may not impose such judgments against rental

car companies based on the negligence of

their lessees.

Id. at 1249.

The Court of Appeals’ conclusion in Garcia states

an obvious, self-evident syllogism: if states could impose

vicarious liability through their insurance requirements,

“[t]he exception would swallow the rule” and make the

“preemption clause a nullity.” Id. at 1248. Other

courts have properly agreed. See e.g., Subrogation Div.,

Inc. v. Brown, 446 F.Supp.3d 542, 552–53 (D.S.D. 2020)

(concluding any other interpretation “would swallow

the preemption clause and negate the Amendment’s

primary purpose”); Rodriguez v. Testa, 993 A.2d 955,

967 (Conn. 2010) (“The exception would swallow the

rule.”); Meyer v. Nwokedi, 759 N.W.2d 426, 431 (Minn.

Ct. App. 2009) (“This result would allow the savings

clause to swallow the entire statute.”), aff’d, 777 N.W.2d

218 (Minn. 2010). As one court put it: “Why would

Congress expressly preempt state laws that imposed

joint and several liability on car rental companies in

one part of [the Graves Amendment] only to allow

continued joint and several liability in the guise of

state financial responsibility statutes in another? The

answer is that Congress did not.” Enter. Rent-A-Car

Co. of Bos., LLC v. Maynard, No. 2:11-CV-00047-JAW,

2012 WL 1681970, at *9 (D. Me. May 14, 2012).

Until the Nevada Supreme Court’s decision in

Woldeyohannes, courts followed Garcia’s patent logic.

For example, the Connecticut Supreme Court held a

statute imposing vicarious liability unless lessors

obtained liability insurance was not a “financial res-

16

ponsibility law.” Rodriguez, 993 A.2d at 963–64. The

Supreme Court of Minnesota reached the same conclusion concerning a similar statute. Meyer v. Nwokedi,

777 N.W.2d 218 (Minn. 2010), as did the Florida

Supreme Court in Vargas v. Enter. Leasing Co., 60

So.3d 1037 (Fla. 2011), and the Supreme Court of Rhode

Island in Puerini v. Lapierre, 208 A.3d 1157, 1165–68

(R.I. 2019).5

The judicial response to protect vehicle leasing in

various states has been similarly universal, upholding

the Graves Amendment’s preemptive reach and interpreting its “financial responsibility law” exemption

narrowly—lest the exemption swallow the rule. See,

e.g., Subrogation Div., 446 F. Supp. at 552–53 (“The form

in which [the] law attempts to [impose liability for

customer’s negligence] does not matter.”); Second Child

v. Edge Auto, Inc., 230 N.Y.S.3d 59, 62 (N.Y. App. Div.

2025) (“Requiring defendants to primarily insure and

indemnify plaintiffs’ damage is the precise result

barred by the Graves Amendment.”); 37 S. Fifth Ave.

Corp. v. Dimensional Stone & Tile, 66 N.Y.S.3d 774,

776 (N.Y. App. Term. 2017) (collecting cases); Maynard,

2012 WL 1681970, at *9 (citing cases); Martin v.

Crook, 776 N.W.2d 110, *10 (Iowa Ct. App. 2009).

The Nevada Supreme Court’s decision in Woldeyohannes disrupts the nationwide uniformity in approach

to and preemption of state vicarious liability laws from

which Congress intended to protect vehicle lessors. The

5 The conflict the Nevada Supreme Court’s decision creates among

state supreme courts alone justifies a grant of certiorari. Wisconsin

v. Mitchell, 508 U.S. 476, 482–83 (1993) (granting review of

important federal question that had created a “conflict of authority among state high courts”).

17

factual underpinnings of Woldeyohannes are not unique

to Graves Amendment jurisprudence and should not

have required the legal jiu jitsu employed by the Nevada

Supreme Court to avoid pre-emption. Like so many

courts before it, the Nevada Supreme Court faced the

simple issue of whether the Graves Act preempted

Nevada’s statute imposing vicarious liability on rental

car companies under certain circumstances. Malco

Enters. of Nevada, 559 P.3d 875. The law, Nev. Rev.

Stat. § 482.305, “holds short-term lessors of motor

vehicles who fail to provide minimum insurance coverage to lessees jointly and severally liable for damage

caused by a lessee’s negligence.” Id. at 876. Despite acknowledging that preemption under § 30106(a) appeared

to be a “foregone conclusion,” id. at 878, the court

concluded the statute was exempted from preemption

as a “financial responsibility law” under § 30106(b),

id. at 876.

The Nevada Supreme Court erred by holding that

the “financial responsibility law” exception to the

Graves Amendment allowed imposition of vicarious

liability in the State of Nevada. Id. at 881. As Petitioners correctly point out, the Nevada Supreme Court

cast-aside decades of Graves Act jurisprudence to the

contrary, adopted a rule where the exception “swallows

the rule” and makes the “preemption clause a nullity,

and jeopardized vehicle leasing and renting in Nevada.”

The Nevada Supreme Court’s error will reach far

beyond the State of Nevada’s borders. Any state requiring, instead of “inducing” or “encouraging,” maintenance

of insurance can avoid the Graves Amendment’s

preemptive reach. In one fell swoop, the Nevada

Supreme Court allows what the Graves Amendment

was expressly passed to prevent—imposing an indi-

18

vidual state’s vicarious liability law on in-state and

out-of-state leasing companies, disrupting the industry

nationwide.

The decision below threatens to disrupt the decades

of stability created by the Graves Amendment for the

vehicle leasing industry. The vehicle leasing industry

plays a crucial role in the U.S. economy and benefits

millions of consumers and businesses. Only this Court

can resolve the conflict the decision below has created

and restore the nationwide uniformity that was key

to Congress’s passage of the Graves Amendment.

19

CONCLUSION

For these reasons, and those stated by Petitioner,

the Court should grant the petition for certiorari.

Respectfully submitted,

Scott Hyman

Counsel of Record

WOMBLE BOND DICKINSON US LLP

400 Spectrum Center Dr., Ste. 1700

Irvine, CA 92618

(657) 266-1067

Scott.Hyman@wbd-us.com

Kenneth F. Rossman, IV

WOMBLE BOND DICKINSON US LLP

1601 19th Street, Ste. 1000

Denver, CO 80202

(303) 623-9000

Ken.Rossman@wbd-us.com

Counsel for Amici Curiae

July 18, 2025