Petition for Writ of Certiorari — Dennis v. Higgins

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IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

MARK E. DENNISs,

Petitioner,

MARGARET L. HIGGINS, DIRECTOR,

NEBRASKA DEPARTMENT OF MOTOR VEHICLES, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

SUPREME COURT OF NEBRASKA

RICHARD A. ALLEN

(Counsel of Record)

ZUCKERT, SCOUTT & RASENBERGER

888 Seventeenth Street, N.W.

Suite 600

Washington, D.C. 20006

(202) 298-8660

RICHARD L. SPANGLER, JR.

Woops & AITKEN

1500 American Charter Center

206 South 13th Street

Lincoln, Nebraska 68508

(402) 474-0321

a eS

WILSON - Eres PrintinG Co., Inc. - 789-0096 - WASHINGTON, D.C. 20001

QUESTION PRESENTED

Whether a claim that a state tax discriminates against

interstate commerce in violation of the Commerce Clause

and that seeks an injunction against enforcement of the

tax is cognizable under 42 U.S.C. § 1983.

(i)

TABLE OF CONTENTS

r ditt cictieettscecneceenieeniencitaccesessmmeaconcetes

CONSTITUTIONAL AND STATUTORY PROVI-

e ...

ES 3m

A. Nebraska's Retaliatory Tacekekss

REASONS FOR GRANTING THE PETITION

I. THERE JS A CONFLICT AMONG THE CIR-

CUITS AS TO WHETHER 42 U.S. C. § 1983

APPLIES TO VIOLATIONS OF THE COM-

II. THE DECISION OF THE NEBRASKA SU-

PREME COURT THAT THE COMMERCE

CLAUSE DOES NOT SECURE PERSONAL

RIGHTS IS CONTRARY TO NUMEROUS DE-

CISIONS OF THIS COURT nn...

III. WHETHER 42 U.S.C. § 1983 APPLIES TO

COMMERCE CLAUSE VIOLATIONS IS EX-

TREMELY IMPORTANT TO THE EFFEC-

TIVE ENFORCEMENT OF THAT CLAUSE,

AS THIS CASE ILLUSTRATES———

ES SAA

(iii)

TABLE OF AUTHORITIES

Cases Page

American Trucking Associations, Inc. v. Conway,

146 Vt. 574, 508 A.2d 405 (1986), cert. denied,

r vaiinrintcetenicheicenssemescnenebenniremnens 8

American Trucking Associations, Inc. v. Gray, 483

i a p —— 5

American Trucking Associations, Inc. v. Scheiner.

r dcctcctetinstitenevintitaiclinigpidsintidinativen 3

ANR Pipeline Company v. Michigan Public Service

Commission, 608 F. Supp. 43 (W. D. Mich 1984) .. 9

Bailey v. Patterson, 369 U.S. 31 (196277 8,11

Boston Stock Exchange v. State Tax Commission,

rr 10

Chapman v. Houston Welfare Rights Organization,

rE .. 12

City of Riverside v. Rivera, 477 U.S. 561 (1986) 14

Confederated Salish and Kootenai Tribes v. Moe,

392 F. Supp. 1297 (D. Mont. 1975), aff'd, 425

By Se IIE cai. d 9

Consolidated Freightways Corp. v. Kassel, 730 F.2d

1139 (8th Cir.), cert. denied, 469 U.S. 834

e Al

Continental Illinois Corp. v. Lewis, 838 F.2d 457

(11th Cir. 1988), vacated on other grounds, 110

S.Ct. 1249, 58 U.S.L.W. 4330 (1990) 9 9

Edwards v. California, 314 U.S. 160 (1941) ..... 1 11

Garrity v. New Jersey, 385 U.S. 493 (1967) 10

Georgia v. Private Truck Council of America, Inc.,

258 Ga. 531, 371 S.E.2d 378 (1988) ..................... 5,8

Golden State Transit Corp. v. City of Los Angeles,

110 S.Ct. 444, 58 U.S.L.W. 4033 (198997 12

Howlett v. Rose, 537 So.2d 706 (Fla. Dist. Ct.

App.), review denied, 545 So.2d 1367 (Fla.

1989), cert. granted, 110 S.Ct. 403 (1989) (No.

r .. 13

Hutto v. Finney, 437 U.S. 678 (1978) cra +

J & J Anderson, Inc. v. Town of Erie, 767 F. 2d

e —ꝛ—p‚ 8

Kennecott Corp. v. Smith. 637 F.2d 181 (3rd Cir.

1980) ä — — „ 9

TABLE OF AUTHORITIES—Continued

Page

Kentucky v. Graham, 473 U.S. 159 (1985) 13

Kraft v. Jacka, 872 F.2d 862 (9th Cir. 1989)... 8

Maher v. Gagne, 448 U.S. 122 (1980) 13

Maine v. Thiboutot, 448 U.S. 1 (1980) 9, 13, 14

Maldonado v. Nebraska Department of Public Wel-

fare, 223 Neb. 485, 391 N.W.2d 105 (1986) 13

Martin-Marietta Corp. v. Bendix Corp., 690 F.2d

D, ceusebeotqeens 9

McLeod v. J. E. Dilworth Co., 322 U.S. 327 (1944) 10

Morgan v. Virginia, 328 U.S. 373 (1946) 8, 11, 15

Newman v. Piggie Park Enterprises, Inc., 390 U.S.

RSE AS a ea 14

Pesticide Public Policy Foundation v. Village of

Wauconda, III., 826 F.2d 1068 (7th Cir. 1987),

affirming without opinion 622 F. Supp. 423

, ar ivae een REL Sot al a ae 8

Private Truck Council of America, Inc. v. Florida

Department of Revenue, 531 So.2d 367 (Fla.

, 5, 8

Private Truck Council of America, Inc. v. New

Hampshire, 128 N.H. 466, 517 A.2d 1150

%% ̃— A 5, 8

Private Truck Council of America, Inc. v. New

Jersey, 221 N.J. Super. 89, 534 A.2d 13 (N..

Super. Ct. App. Div. 1987), aff’d, 111 N.J. 214,

. 5, 8

Private Truck Council of America, Inc. v. Okla-

homa Tax Commission, No. CJ-84-9902 (Dist.

Ct., Oklahoma Co., O.K. February 6, 1987), ap-

peal filed, No. 68,401 (O. K. March 9, 1987) 5,8

Private Truck Council of America, Inc. v. Sec’y of

State, 503 A.2d 214 (Me.), cert. denied, 476 U.S.

SE PR ee Se ORD 5, 8

United States v. Guest, 383 U.S. 745 (1966) 11. 15

Western Union Tel. Co. v. State of Kansas, 216

,, T. 10

Will v. Michigan Department of State Police, 109

F el ; 13

TABLE OF AUTHORITIES—Continued

Statutes and Other Materials Page

TEES 3c passim

a passim

Neb. Rev. Stat. § 60-305 (Reissue 1983) 3

, ... 2

H. R. Rep. No. 94-1558 (1976)))7:ꝛ: 14

IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

No. ——

MARK E. DENNIS,

* Petitioner,

MARGARET L. HIGGINS, DIRECTOR,

NEBRASKA DEPARTMENT OF MOTOR VEHICLES, et al.,

Respondents. '

PETITION FOR A WRIT OF CERTIORARI TO THE

SUPREME COURT OF NEBRASKA

OPINIONS BELOW

The opinion of the Supreme Court of Nebraska (App.

A, infra) is not yet reported. The opinion of the district

court of Lancaster County (App. B, infra) is not re-

ported. The judgment of the district court of Lancaster

County denying petitioner’s motions for class certification

and preliminary injunction is set forth in App. C, infra.

! Petitioner is Mark E. Dennis. Respondents are the following

officials of the State of Nebraska: Margaret L. Higgins, Director,

Nebraska Department of Motor Vehicles, Gerald C. Strobel, Di-

rector, Nebraska Department of Roads, and Frank Marsh, Ne-

braska State Treasurer. Respondents are successors in office to

other officials whom petitioner sued in their official capacities for

injunctive relief.

JURISDICTION

The judgment of the Supreme Court of Nebraska

(App. A, infra, la-27a) was entered on February 16,

1990. The jurisdiction of this Court is invoked under 28

U.S.C. § 1257(a).

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

42 U.S.C § 1983 provides, in pertinent part:

Every person who, under color of any statute, ordi-

nance, regulation, custom, or usage, of any State or

Territory or the District of Columbia, subjects, or

causes to be subjected, any citizen of the United

States or other person within the jurisdiction thereof

to the deprivation of any rights, privileges, or im-

munities secured by the Constitution and laws, shall

be liable to the party injured in an action at law,

suit in equity, or other proper proceeding for redress.

The Commerce Clause of the United States Constitu-

tion, Article I, Section 8, Clause 3, provides:

The Congress shall have Power...

To regulate Commerce with foreign Nations, and

among the several States, and with the Indian

Tribes;

Pertinent provisions of Nebraska’s retaliatory tax stat-

ute, Nebraska Rev. Stat. § 60-305 (Reissue 1984), are set

forth in App. D, infra.

STATEMENT

In this case, petitioner filed a class action suit in a

Nebraska state court on December 17, 1984 challenging

the constitutionality of certain “retaliatory taxes” that

the State of Nebraska imposed on motor carriers, includ-

ing petitioner, who operated trucks in Nebraska that were

registered in certain other states. The Supreme Court

of Nebraska affirmed a trial court decision declaring that

Nebraska’s retaliatory taxes violated the Commerce

Clause of the United States Constitution, but it held that

this violation did not deprive petitioner of personal con-

situtional “rights” and therefore did not entitle petitioner

to relief under 42 U.S.C. § 1983 or to litigation cos“ and

attorneys’ fees under 42 U.S.C. § 1988.

A. Nebraska’s Retaliatory Taxes

Nebraska, like most other states, imposes a variety of

fees and taxes on motor carriers operating in the state,

such as fees for the registration of vehicles and taxes for

the use of fuel in the state. In addition, until it was re-

cently amended, Neb. Rev. Stat. § 60-305 (Reissue 1984)

authorized respondents, various state officials, to levy ad-

ditional taxes, commonly known as “retaliatory taxes,”

which were imposed only on carriers operating vehicles

in Nebraska that were registered in certain other states

and were not imposed on Nebraska-registered vehicles

(App. D, infra). The purpose of § 60-305 was to retali-

ate against states imposing so-called “third structure

taxes,” which certain states have imposed on all motor

carriers operating in those states, including Nebraska-

registered carriers, and to which Nebraska objected.

Section 60-305 carried out this purpose by authorizing

A “third structure tax” is one that is imposed on motor car-

riers in addition to the more traditional charges states have levied

on such carriers, which are registration fees and fuel taxes (80

called “first” and “second structure” taxes). Examples of third

structure taxes include ton-mile taxes, which are based on the

weight of trucks and the mileage operated in the taxing state,

and axle taxes, which impose a flat charge based on the number of

axles on each vehicle. In American Trucking Associations, Inc. v.

Scheiner, 483 U.S. 266 (1987), this Court invalidated one such

third structure tax, Pennsylvania’s axle tax. The Court noted

that flat taxes like Pennsylvania's had prompted Nebraska and

six other states to enact retaliatory taxes, and it stated: “Such

taxes can obviously divide and disrupt the market for interstate

transportation services.” Id. at (footnotes omitted).

respondents to impose taxes on carriers registered in

those states that operate in Nebraska which taxes are

equal in amount to the third structure tax imposed by

the carriers’ state of registration. By thus penalizing

carriers from third structure tax states, Nebraska’s leg-

islature hoped to pressure the legislatures of those states

to repeal their third structure taxes or exempt Nebraska-

based carriers from them.

Respondents implemented § 60-305 by imposing retalia-

tory taxes on carriers whose vehicles were registered in

nine states: Arizona, Arkansas, Idaho, Nevada, New

York, Ohio, Oregon, Pennsylvania and Wyoming App.

22a).

B. Proceedings Below

Petitioner Mark E. Dennis, doing business as Dennis

Trucking, is a motor carrier residing in Royalton, Ohio,

who began operating in 1978 with one truck. Petitioner

and his wife now own and operate four tractors and six

trailers in several states, including Nebraska. His trac-

tors are registered in Ohio, which imposes a two cents

per mile third structure tax. Petitioner was therefore

subject to and paid Nebraska’s retaliatory tax (App.

29a).

Petitioner filed a complaint in a Nebraska state court

on December 17, 1984 as a class action seeking injunctive

and declaratory relief and refunds.’ The complaint al-

3 Petitioner was joined as a plaintiff in his original complaint

by the Private Truck Council of America, Inc. (“PTCA”) (now

the National Private Truck Council, lac.), a trade association of

private motor carriers, many of whose members were subject to

Nebraska’s retaliatory tax. The trial court, however, dismissed

PTCA as a plaintiff on the ground that it lacked standing because

it was not itself subject to the tax (App. 33a).

PTCA and other motor carriers that were subject to re-

taliatory taxes had filed suits in December 1984 and January 1985

against Nebraska and the six other states that had enacted re-

taliatory motor carrier taxes, Maine, New Hampshire, New Jersey,

leged that Neb. Rev. Stat. § 60-305 (Reissue 1984) dis-

criminated on its face against interstate commerce and

out-of-state residents in violation of the Commerce Clause

and the Privileges and Immunities Clause of Article iV,

Section 2 of the United States Constitution. It also al-

leged that the respondents were therefore liable to peti-

tioner under 42 U.S.C. § 1983. Upon filing his complaint,

petitioner moved for a preliminary injunction or, alter-

natively, for an order requiring the tax collections to be

held in escrow pending the outcome of the suit.“

The trial court denied petitioner’s motion for a pre-

liminary injunction or an escrow order and his motion

for class certification (App. 35a). After a hearing on

stipulated facts, the trial court, on September 30, 1987,

issued a decision declaring the challenged taxes uncon-

stitutional as an unlawful burden on interstate com-

merce in violation of the Commerce Clause. The court

concluded: “On their face said taxes and fees discrim-

inate against interstate commerce.” (Id. at 29a). Ac-

cordingly, it permanently enjoined respondents from as-

sessing, levying or collecting the taxes (id. at 30a). The

Georgia, Florida, and Oklahoma. Each of those actions, except the

one in Oklahoma, has resulted in final state court decisions invali-

dating the taxes. Private Truck Council of America, Inc. v. Sec’y

of State, 503 A.2d 214 (Me.), cert. denied, 476 U.S. 1129 (1986):

Private Truck Council of America, Inc. v. New Hampshire, 128

N.H. 466, 517 A.2d 1150 (1986); Private Truck Council of Amer-

ica, Inc. v. New Jersey, 221 NJ. Super. 89, 534 A.2d 13 (N..

Super. Ct. App. Div. 1987), aff'd, 111 N.J. 214, 544 A 2d 33 (1988):

Georgia v. Private Truck Council of Amevica, Inc, 258 Ga. 531, 371

$.E.2d 378 (1988); Private Truck Council of America, Ine. v.

Florida Department of Revenue, 531 So.2d 367 (Fla. Dist. Ct. App.

1988). A trial court decision upholding Oklahoma's tax in 1987 is

pending on appeal before the Oklahoma Supreme Court. Private

Truck Council of America, Inc. „. Oklahoma Tax Commission, No.

CJ-84-9902 (Dist. Ct., Oklahoma Co., O.K. February 6, 1987), appeal

filed, No. 68,401 (O.K. March 9, 1987).

* Escrow orders have often been issued in suits of this kind.

Justice Blackmun issued such an order in American Trucking

Associations, Inc. v. Gray, 483 U.S. 1306, 1310 (1987).

court, however, ‘denied without explanation petitioner’s

claim under 42 U.S.C. § 1983 (id. at 30a).

With respect to the entitlement of petitioner and other

taxpayers to refunds, the court held that all taxpayers

would have to file claims for refunds with the Nebraska

Department of Administrative Services (App. 30a). The

court also held that petitioner and his attorneys would

be entitled to payment of their costs and attorneys’ fees

under the equitable “common fund” doctrine, but it de-

nied without comment their request for determination

that the pertinent common fund would be all the taxes

that would be subject to refund as a result of the court’s

judgment App. 30a). Since petitioner had paid less than

$100 in taxes and since his motion to proceed as a class

action had been denied, the court effectively held that

there was no common fund from which litigation ex-

penses and attorneys’ fees could be recovered.

Petitioner appealed the denial of his claim under 42

U.S.C. § 1983 and the denial of his claim regarding the

composition of the common fund. Respondents did not

cross-appeal the trial court’s invalidation of the tax but

did cross-appeal its ruling—albeit a meaningless one

that there was any common fund entitlement to fees and

expenses.

On February 16, 1990, the Nebraska Supreme Court

affirmed the trial court’s denial of petitioner’s claim

under 42 U.S.C. § 1983, but reversed its holding that

petitioner and his attorneys had even a theoretical right

to recover fees and expenses under the common fund

doctrine (App. 27a). On the latter point, the court held

that there was no such right because there was no fund,

inasmuch as class certification had been denied and re-

funds to taxpayers would depend on the filing of indi-

The parties stipulated that petitioner paid a total of $52.60 in

retaliatory taxes to Nebraska in 1983 and 1984, the only years

covered by the stipulation.

vidual refund claims and on case-by-case determinations

of their merits (id. at 26a).

With respect to petitioner’s claim under 42 U.S.C.

1983 the court held:

Despite the broad language of § 1983 and the fact

that there appears to be a division of authority on the

question as to whether there is a cause of action

under $ 1983 for violations of the commerce clause,

we believe the better reasoned cases hold that there

is no cause of action under § 1983 for violations of

the commerce clause.

(App. 5a). The court relied primarily on Consolidated

Freightways Corp. v. Kassel, 730 F.2d 1139, 1144 (8th

Cir.), cert. denied, 469 U.S. 834 (1984), which held

that “the Commerce Clause does not establish individual

rights against government, but instead allocates power

between the state and federal governments.”

REASONS FOR GRANTING THE PETITION

The decision of the Supreme Court of Nebraska pre-

sents a question of far-reaching importance: whether or

not state violations of the Commerce Clause deprive per-

sons affected by such violations of “rights, privileges or

immunities secured by the Constitution,” and therefore

give rise to liability under 42 U.S.C. § 1983. That is a

recurring question as to which the federal courts of ap-

peals and many state courts are sharply divided, and it

warrants this Court’s review. The Nebraska Supreme

Court’s conclusion that the Commerce Clause does not

secure personal rights conflicts not only with other

federal circuit and district court decisions applying 42

U.S.C. § 1983 to Commerce Clause violations but also

with decisions of this Court expressly holding that the

Commerce Clause does secure personal rights. Indeed,

some of this Court’s landmark civil rights decisions were

based squarely on the Commerce Clause and the rights of

persons under that Clause to travel among the states free

of state segregation laws that the Court found to be an

undue burden on such interstate travel. E. g., Bailey „.

Patterson, 369 U.S. 31 (1962); Morgan v. Virginia, 328

U.S. 373 (1946). The decision below cannot be squared

with those decisions.

I. THERE JS A CONFLICT AMONG THE CIRCUITS

AS TO WHETHER 42 U.S.C. § 1983 APPLIES TO VIO-

LATIONS OF THE COMMERCE CLAUSE

In holding that 42 U.S.C. § 1983 does not provide re-

dress for violations of the Commerce Clause, the Supreme

Court of Nebraska acknowledged that there is a division

of authority on the question (App. 5a). Its decision

agrees with decisions of the Seventh,“ Eighth,’ Ninth *

and Tenth’ Circuits and a number of state court de-

cisions." All of these rely primarily on the reasoning set

forth in the Eighth Circuit’s decision in Consolidated

Freightways Corp. v. Kassel that the Commerce Clause

® Pesticide Public Policy Foundation v. Village of Wauconda,

III., 826 F.2d 1068 (7th Cir. 1987), affirming without opinion 622

F. Supp. 423 (N. D. Ill. 1985).

7 Consolidated Freightways Corp. ». Kassel, 730 F.2d 1139 (8th

Cir.), cert. denied, 469 U.S. 834 (1984).

Kraft v. Jacka, 872 F.2d 862 (9th Cir. 1989).

*J & J Anderson, Inc. v. Town of Evie, 767 F.2d 1469 (10th Cir.

1985).

10 Private Truck Council of America, Inc. ». New Hampshire,

128 N.H. 466, 517 A.2d 1150 (1986); Private Truck Council of

America, Inc. „. New Jersey, 221 N.J. Super. 89, 534 A.2d 18 (N..

Super. Ct. App. Div. 1987), aff'd, 111 N.J. 214, 544 A.2d 33 (1988);

American Trucking Associations, Inc. v. Conway, 146 Vt. 574, 508

A.2d 405 (1986), cert. denied, 483 U.S. 1020 (1987); Private Truck

Council of America, Inc. v. Sec'y of State, 503 A.2d 214 Me.),

cert, denied, 476 U.S. 1129 (1986): Georgia v. Private Truck Council

of America, Inc., 258 Ga. 531, 371 S.E.2d 378 (1988); Private Truck

Council of America, Inc. v. Florida Department of Revenue, 531

So.2d 367 (Fla. Dist. Ct. App. 1988

merely “allocates power between the state and federal

governments” and does not secure individual rights.

The decision below, however, conflicts with decisions of

the Third, Sixth and Eleventh Circuits. For example, in

Kennecott Corp. v. Smith, 637 F.2d 181 (3rd Cir. 1980),

the Third Circuit squarely held that § 1983 encompasses

Commerce Clause claims. The court stated:

The present action is properly brought under § 1983

because it seeks redress for deprivations of constitu-

tional rights secured by the commerce clause and of

federal statutory rights protected by the Williams

Act. See Maine v. Thiboutot, 448] U.S. [1], 100

S.Ct. 2502, 65 L.Ed.2d 555 (1980).

637 F.2d at 186 n.5. The same conclusion was reacaed

in Continental Illinois Corp. v. Lewis, 838 F.2d 457, 458

(llth Cir. 1988), vacated on other grounds, 110 S. Ct.

1249, 58 U.S.L.W. 4330 (1990); Martin-Marietta Corp.

v. Bendix Corp., 690 F.2d 558, 562 (6th Cir. 1982);

ANR Pipeline Company v. Michigan Public Service Com-

mission, 608 F. Supp. 43, 48 (W.D. Mich. 1984); and

Confederated Salish and Kootenai Tribes v. Moe, 392 F.

Supp. 1297, 1304-1305 (D. Mont. 1975), aff'd, 425 U.S.

463 (1976). This Court recently reviewed the Eleventh

Cireuit's decision in Continental I/linois Corp. v. Lewis,

but found it unnecessary to decide the § 1983 issue be-

cause it found that events had mooted the underlying

controversy and it therefore vacated the circuit court’s

decision. 58 U.S. L. W. at 4333.

This conflict among the circuits and the state supreme

courts warrants this Court’s review. The issue has arisen

in many cases in recent years. It is likely to recur in

almost every case challenging state laws and actions

under the Commerce Clause and may also arise with

respect to other constitutional provisions to which the

rationale of the court below could be extended. This case

presents the issue squarely and is an appropriate case in

which to consider and resoi.. he issue.

Il. THE DECISION OF THE NEBRASKA SUPREME

COURT THAT THE COMMERCE CLAUSE DOES

NOT SECURE PERSONAL RIGHTS IS CONTRARY

TO NUMEROUS DECISIONS OF THIS COURT

The conclusion of the court below and other courts that

the Commerce Clause does not establish personal rights

that may be redressed under § 1983 is also directly in

conflict with decisions of this Court applying the Com-

merce Clause, and it would have anomalous and far-

reaching consequences. While the underlying purpose of

the Commerce Clause is to “create an area of free trade

among the several States,” McLeod v. J. E. Dilworth Co.,

322 U.S. 327, 330 (1944), this Court has made clear that

it does so by creating personal rights, which individuals

may enforce, to be free of discriminatory and excessive

taxation and regulatory burdens imposed by state gov-

ernments. In Boston Stock Exchange v. State Tax Com-

mission, 429 U.S. 318. 320 n.3 (1977), for example, the

Court held that certain stock exchanges had standing to

challenge a New York tax that discriminated against

them and their members, stating ‘emphasis supplied) :

“The Exchanges are asserting their right under the

Commerce Clause to engage in interstate commerce free

of discriminatory taxes on their business .” Simi-

larly, in Garrity v. New Jersey, 385 U.S. 493, 500

(1967), the Court stated: “There are rights of consti-

tutional stature whose exercise a State may not condition

by the exaction of a price. Engaging in interstate com-

merce is one. Western Union Tel. Co. v. State of Kansas,

216 U.S. 1, 30 S.Ct. 190, 54 L.Ed. 355.” In these and

many other cases, the Court has used and understood the

term “right” to mean any legal privilege or protection

which a person may enforce by judicial action.

The personal nature of the rights secured by the Com-

merce Clause is perhaps most dramatically illustrated by

this Court’s landmark civil rights decision which struck

down racially discriminatory state laws as violations of

—

the Commerce Clause. In Morgan v. Virginia, 328 U.S.

373 (1946), the Court upheld an individual passenger’s

Commerce Clause challenge to a Virginia statute requir-

ing racial segregation on interstate buses. Significantly,

the Court rejected a challenge to the passenger’s standing

to invoke the Commerce Clause; the Court stated:

We think .. that the appellant is a proper person to

challenge the validity of this statute as a burden on

commerce... Constitutional protection against bur-

dens on commerce is for her benefit on a criminal

trial for violation of the challenged statute.

Id. at 376-377 (emphasis supplied, footnote omitted).

Accord, Bailey v. Patterson, 369 U.S. 31 (1962). See

also Edwards v. California, 314 U.S. 160 (1941), and

United States v. Guest, 383 U.S. 745, 757-760 (1966),

recognizing a “constitutional right to travel from one

State to another“ based on the Commerce Clause. Al-

though they were «ited to it, the court below made no

reference in its opinion to the foregoing decisions of this

Court, and its ruling that the Commerce Clause does not

secure personal rights simply cannot be reconciled with

those decisions.

Furthermore, contrary to the conclusion of the court

below and other courts that have adopted the rationale of

the Eighth,Circuit in Consolidated Freightways Corp. v.

Kassel, t is simply no rational or workable prin-

ciple upon which constitutional provisions can be divided

among those that create “individual rights” on the one

hand and those that, in the words of the Eighth Circuit,

merely “allocate|| power between the state and federal

governments.“ If accepted, the rationale of the court

below and the Eighth Circuit could be extended to a host

of constitutional provisions including, for example, all of

the powers of Congress in Article I, Section 8 and all of

the restrictions in Article I, Section 10 upon states, such

as those prohibiting bills of attainder, ex post facto laws,

11 Consolidated Freightways Corp. v. Kassel, 730 F.2d at 1144,

laws impairing contracts, and duties on exports and im-

ports. Taking this purported distinction to its logical

conclusion could even lead to the determination that the

First and Fourteenth Amendments create no “individual

rights“ redressable by § 1983 because they are phrased

in terms of limitations on the powers of the federal and

state governments.“

To petitioner, his right under the Commerce Clause to

conduct his trucking business among the several states

free from discriminatory or unduly burdensome state

laws is as vital as any other right the Constitution se-

cures to him. His livelihood depends on it.

III. WHETHER 42 U.S.C. §1983 APPLIES TO COM-

MERCE CLAUSE VIOLATIONS IS EXTREMELY

IMPORTANT TO THE EFFECTIVE ENFORCE-

MENT OF THAT CLAUSE, AS THIS CASE ILLUS-

TRATES

The issue in this case is also extremely important for

the effective enforcement of the Commerce Clause, par-

ticularly in cases like this one. Its principal importance

relates to the ability of persons who have been injured by

12 The court below and the Eighth Circuit in Kassel erroneously

analogized the Commerce Clause to the Supremacy Clause. The

Supremacy Clause, however, is very different from the Commerce

Clause, and indeed, from any other provision of the federal Con-

stitution. The Supremacy Clause is merely a declaration of the

supremacy of the federal Constitution and federal laws over state

laws; as this Court noted in Chapman v. Houston Welfare Rights

Organization, 441 U.S. 600, 613 (1979), it is not itself a source of

any federal rights.” See also Golden State Transit Corp. v. City of

Los Angeles, 110 S.Ct. 444, 58 U.S.L.W. 4033 (1989). The Com-

merce Clause, in contrast, clearly is a “source of . . federal rights”

which individuals may enforce, and in that respect it is no different

from the Ex Post Facto Clause or the Bill of Attainder Clause or

any other substantive limitation on the power of states contained

in the Constitution. Since those are all limitations that individuals

may personally enforce by judicial action, each of those clauses can

only be regarded as establishing personal constitutional “rights.”

— ee

the violation of their rights under the Commerce Clause

to recover litigation expenses and attorneys’ fees under

42 U.S.C. § 1988, the attorneys’ fees counterpart to

§ 1983. If such persons are entitled to injunctive relief

or damages under § 1983 against the responsible state

officials, they would ordinarily be entitled to recover at-

torneys’ fees and litigation expenses from the entities

whom those officials represent, even if relief were actually

awarded on another ground. Maher v. Gagne, 448 U.S.

122, 132 n.15 (1980); Maine v. Thiboutot, 448 U.S. 1,

10-11 (1980); Hutto v. Finney, 437 U.S. 678, 693-694

(1978).

When Congress enacted § 1988 in 1976, it recognized

that the ability of plaintiffs to recover litigation costs

and attorneys’ fees is often essential to the effective pro-

13 In Will v. Michigan Department of State Police, 109 S.Ct. 2304

(1989), the Court held that neither states nor state officials sued in

their official capacities for money damages are “persons” that are

subject to suit under § 1983. The Court, however, also stated: “Of

course, a state official in his or her official capacity, when sued for

injunctive relief, would be a person under § 1983 because ‘official-

capacity actions for prospective relief are not treated as actions

against the State.’” 109 S.Ct. at 2311 n.10 (quoting Kentucky v.

Graham, 473 U.S. 199, 167, n.14 (1985)). The Court has also held

that attorneys’ fees under § 1988 may be recovered from a state or

state agency in actions for injunctive relief against state officials.

Hutto v. Finney, 437 U.S. 678 (1978). In this case, petitioner sued re-

spondents’ predecessors in their official capacities and sought and

obtained injunctive relief against them.

Since the action sought prospective relief against state officials

acting in their official capacities, this case does not present the

question of whether a state may assert sovereign immunity against

a § 1983 action, which is the question under review in Howlett v.

Rose, 537 So.2d 706 (Fla. Dist. Ct. App.), review denied, 545

So.2d 1367 (Fla. 1989), cert. granted, 110 S.Ct. 403 (1989) (No. 89.

5383), argued March 20, 1990. Moreover, Nebraska has never

asserted sovereign immunity against 5 1983 actions in its own

courts. On the contrary, its decisions recognize such actions. See

Maldonado v. Nebraska Department of Public Welfare, 223 Neb. 485,

391 N.W.2d 105, 109-110 (1986).

tection of their constitutional rights. In Maine v. Thi-

boutot, this Court noted that “Congress viewed the fees

authorized by § 1988 as ‘an integral part of the remedies

necessary to obtain’ compliance with § 1983. S. Rep. No.

94-1011, p. 5 (1976).” 448 U.S. at 11. See also Hutto v.

Finney, 437 U.S. at 694. Furthermore, Congress enacted

§ 1988 in recognition of the fact that parties who bring

suit under § 1983 and prevail are typically seeking not

only to redress their own injuries but also to vindicate

important civil and constitutional rights of many other

people and the public at large. See City of Riverside v.

Rivera, 477 U.S. 561, 574 (1986). As the House Report

accompanying § 1988 noted, a person who obtains injunc-

tive relief under § 1983 “ ‘does so not for himself alone

but also as a ‘private attorney general,’ vindicating

a policy that Congress considered of the highest impor-

tance.’” H.R. Rep. No. 94-1558, p. 2 (1976) (quoting

Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400,

402 (1968) ).

Section 1988 is no less important in vindicating the

vital public and national interests in the free flow of

interstate commerce, and the policies underlying § 1988

are fully applicable to Commerce Clause cases like this

one. In many ca es, including this one, a state tax, regu-

lation or practice that violates the Commerce Clause will

impose a cost on persons and companies that is sub-

stantially less, in the case of even the largest companies,

than the expense would be of bringing a lawsuit to chal-

lenge it. If, as in this case, the state’s procedures do not

permit a class action, the prospect of recovering expenses

and attorneys’ fees under 42 U.S.C. § 1988 will be the

only practical means of bringing suit to invalidate and

enjoin the tax.

If recovery under § 1988 is denied, the result in this

case will be to impose on petitioner and his attorneys

the entire cost of bringing and prosecuting an action

that succeeded in striking down an unconstitutional tax

and saving thousands of interstate motor carriers mil-

lions of dollars. Faced with that outcome, few persons

would bring such actions in the future. The substantial

costs and burdens of litigation would thus serve as an

effective deterrent to judicial challenges to laws of states

like Nebraska that discriminate against or otherwise

unduly burden interstate commerce, contrary to the in-

terests of the nation as a whole.“

In addition to precluding recovery of costs and attor-

neys’ fees, denial of a Commerce Clause claim under

$ 1983 would also preclude recovery of damages fram

persons acting under color of state law in cases where

such damages would be appropriate—for example, where

the defendants had acted in bad faith and therefore had

no qualified immunity from personal liability for dam-

ages. If, for example, state or local officials followed a

policy of subjecting interstate travellers or merchants

to harassment on the basis of their race, or state of

origin, or the state of origin of their commodities, the

victims of such treatment would, under the ruling of

the Nebraska Supreme Court have no entitlement to

damages under § 1983 even though the conduct clearly

contravened the Commerce Clause under this Court’s

rulings. See, e.g., Morgan v. Virginia, 328 U.S. 373

(1946); United States v. Guest, 383 U.S. 745 (1966).

That result, petitioner submits, has no basis in § 1983. It

presents, in any event, an important question warranting

this Court’s review.

14 In some cases, of course, associations of taxpayers or of other

victims of unconstitutional state action may fund litigation chal-

lenging unconstitutional state taxes or other laws. In other cases,

there may not be associations with sufficient resources to do so.

In the case of PTCA’s litigation against retaliatory taxes, PTCA

was able to undertake that effort only because its attorneys were

willing to represent the plaintiffs on a contingent fee basis. Even

where associations or others fund the litigation, Congress enacted

§ 1988 to impose those expenses on the party whose unconstitutional

acts gave rise to the expenses rather than on the victims of those

acts or their representatives.

CONCLUSION

The petition for 2 writ of certiorari to the Supreme

Court of Nebraska should be granted.

Respectfully submitted,

RICHARD A. ALLEN

(Counsel of Record)

ZUCKERT, SCOUTT & RASENBERGER

888 Seventeenth Street, N.W.

Suite 600

Washington, D.C. 20006

(202) 298-8660

RICHARD L. SPANGLER, JR.

Woops & AITKEN

1500 American Charter Center

206 South 13th Street

Lincoln, Nebraska 68508

April 5, 1990 (402) 474-0321

APPENDICES

. r

APPENDIX A

OPINION OF THE SUPREME COURT OF

NEBRASKA

Case Title

MARK E. DENNIS, doing business as DENNIS TRUCKING,

Appellant and Cross-A ppellee,

Vv.

STATE OF NEBRASKA, et al.,

Appellees and Cross-A ppellants.

Case Caption

DENNIS V. STATE

Filed February 16, 1990. No. 88-205

Appeal from the District Court for Lancaster County:

Bernard J. McGinn, Judge. Affirmed in part, and in

part reversed.

Richard A. Allen and Richard P. Schweitzer, of Zuck-

ert, Scoutt & Rasenberger, and Richard L. Spangler, of

Woods, Aitken, Smith, Greer, Overcash & Spangler, for

appellant.

Robert M. Spire, Attorney General, and Jil Gradwohl

Schroeder for appellees.

1. Constitutional Law: Civil Rights: Actions. There is

no cause of action under 42 U.S.C. § 1983 (1982) for

violations of the commerce clause.

2. Constitutional Law: Statutes. The purpose of the

privileges and immunities clause is to outlaw classifica-

tions based on the fact of noncitizenship unless there is

something to indicate that noncitizens constitute a pecu-

liar source of the evil at which the statute is aimed.

3. ; . Statutes which do not make a distinction

based upon residence or citizenship do not violate the

privileges and immunities clause.

4. Attorney Fees. Where one has gone into a court of

equity and, taking the risk of litigation on himself, has

created or preserved or protected a fund in which others

are entitled to share, such others will be required to con-

tribute their share to the reasonable costs and expenses

of the litigation, including reasonable fees to the liti-

gant’s counsel.

5. ———. The common fund must be an immediate fund

from which attorney fees may be awarded at trial.

6. ———. The common fund theory requires for an award

of attorney fees under the common benefit rationale (1)

as ascertainable class of beneficiaries, easly identifiable,

and (2) a source of funds common to the class from

which the award can be made.

Hastings, C.J., Boslaugh, White, Caporale, Shanahan,

and Grant, JJ.

BOSLAUGH, J.

The plaintiff, Mark E. Dennis, doing business as Den-

nis Trucking, commenced this action to obtain a judg-

ment declaring taxes imposed pursuant to Neb. Rev. Stat.

§§ 60-305.02 and 60-305.03 (Reissue 1984) to be uncon-

stitutional and enjoining the defendants from assessing

or collecting such taxes, and to recover the plaintiff's

attorney fees and costs of the action. Named as defend-

ants were the State of Nebraska; Holly Jensen, individ-

ually and as director of the Nebraska Department of

Motor Vehicles; Lou Lamberty, individually and as di-

rector of the Nebraska Department of Roads; and Kay

Orr, individually and as Nebraska Treasurer.

The plaintiff alleged that the taxes and fees imposed

under £§ 60-305.02 and 60-305.03 were an unlawful bur-

den on interstate commerce in violation of U.S. Const.

art. I, § 8, el. 3; constituted a denial of the plaintiff's

privileges and immunities in violation of U.S. Const.

art. IV. § 2, el 1; constituted a grant by the Legislature

of special and exclusive privileges, immunities, and fran-

chises in violation of Neb. Const. art. III. § 18; and

violated 42 U.S.C. § 1983 (1982) by depriving the plain-

tiff of rights secured by the U.S. Constitution.

After a trial to the court on stipulated facts, the trial

court held that the statutes were in violation of the com-

merce clause, U.S. Const. art. I, §8, el. 3, and per-

manently enjoined the defendants from assessing, levy-

ing, or collecting taxes or fees pursuant to §§ 60-305.02

and 60-305.03. The trial court dismissed the remaining

counts, holding that the plaintiff had failed to prove he

was entitled to judgment under U.S. Const. art. IV, § 2,

cl. 1; Neb. Const. art. III, § 18; or 42 U.S.C. 1983.

The order of the trial court further provided:

The plaintiff and his attorneys are entitled under the

Equitable Fund Doctrine to payment of their ex-

penses and reasonable fees. The Court shall deter-

mine the amount of any such expenses and fees by

subsequent order following the submission of docu-

mentation in support thereof and a showing regard-

ing any fund available for payment of said fees and

expenses.

The plaintiff’s motion for new trial, which was overruled,

alleged that the common fund from which his attorneys’

costs and fees may be paid was the total amount of taxes

available for refunds pursuant to the court’s order.

The plaintiff has appealed, contending that the district

court erred in denying his claims under 42 U.S.C. § 1983

and in denying his claim that the common fund from

which litigation costs and attorney fees may be paid con-

sists of the total amount of taxes subject to refund as a

result of the court’s holding. The defendants have cross-

appealed, claiming that the trial court erred in finding

that the plaintiff and his attorneys were entitled under

the equitable fund doctrine to payment of their expenses

and reasonable fees. The defendants have not appealed

the district court’s finding that the statutes were in vio

lation of the commerce clause, and there is no issue in

that regard on this appeal. Both sections have since been

amended. See £§ 60-305.02 and 60-305.03 (Reissue 1988).

Section 1983 provides:

Every person who, under color of any statute,

ordinance, regulation, custom, or usage, of any State

. . . Subjects, or causes to be subjected, any citizen

of the United States or other person within the

jurisdiction thereof to the deprivation of any rights,

privileges, or immunities secured by the Constitution

and laws, shall be liable to the party injured in an

action at law, suit in equity, or other proper pro-

ceeding for redress.

The Civil Rights Attorney’s Fees Awards Act of 1976,

42 U.S.C. § 1988 (1982), provides that attorney fees may

be awarded to the prevailing party, other than the United

States, in any action to enforce a provision of § 1983.

Furthermore, a party who prevails on a ground other

than § 1983 is entitled to attorney fees under § 1988 if

§ 1983 would have been an appropriate basis for relief.

Consol. Freightways Corp. of Del. v. Kassel, 730 F.2d

1139 (8th Cir. 1984), cert. denied 469 U.S. 834, 105

S. Ct. 126, 83 L. Ed. 2d 68; J & J Anderson, Inc. v. Town

of Erie, 767 F.2d 1469 (10th Cir. 1985); Private Truck

Council v. Secretary of State, 503 A.2d 214 (Me. 1986),

cert. denied, 476 U.S. 1129, 106 S. Ct. 1997, 90 L. Ed. 2d

677.

The issues presented by the plaintiff’s first assignment

of error are, therefore, (1) whether a violation of the

commerce clause constitutes a cause of action under

§ 1983 and (2) whether § 1983 would have been an ap-

propriate basis for relief in this case.

Despite the broad language of § 1983 and the fact that

there appears to be a division of authority on the ques-

tion as to whether there is a cause of action under § 1983

for violations of the commerce clause, we believe the

better reasoned cases hold that there is no cause of action

under § 1983 for violations of the commerce clause. The

leading authority appears to be Consol. Freightways

Corp. of Del. v. Kassel, supra, in which the court held

that “the Commerce Clause does not establish individual

rights against government, but instead allocates power

between the state and federal governments.” /d. at 1144.

Cases involving the supremacy clause and reaching the

same result are Golden State Transit Corp. v. City of

Los Angeles, U.S. ——, 110 S. Ct. 444, 107 L. Ed.

2d 420 (1989) (the supremacy clause, of its own force,

does not create rights enforceable under § 1983); Chap-

man v. Houston Welfare Rights Org., 441 U.S. 600, 99

S. Ct. 1905, 60 L. Ed. 2d 508 (1979); White Mountain

Apache Tribe v. Williams, 810 F.2d 844 (9th Cir. 1987)

(preemption of state law under the supremacy clause does

not give rise to a cause of action under § 1983); Gould,

Inc. v. Wisconsin Dept. of Industry, Labor, 750 F.2d 608

(7th Cir. 1984), aff'd 475 U.S. 282, 106 S. Ct. 1057, 89

L. Ed. 2d 223 (1986) (action brought by corporation

alleging that state statutes were preempted by federal

labor law, in violation of the supremacy clause, was not

cognizable under § 1983); and Maryland Pest Control v.

Montgomery County, Md., 884 F.2d 160 (4th Cir. 1989)

(the supremacy clause does not secure rights within the

meaning of § 1983 so as to entitle a successful litigant

to attorney fees pursuant to § 1988).

In Consol. Freightways Corp. of Del. v. Kassel, supra,

Consolidated Freightways sought attorney fees under 42

U.S.C. § 1983 after Iowa’s statute restricting Consoli-

dated’s use of 65-foot twin trailers was declared invalid

as a violation of the commerce clause. The U.S. Court

of Appeals for the Eighth Circuit held that a violation

of the commerce clause did not constitute a claim under

§ 1983.

Iowa contends that the Commerce Clause does not

establish individual rights against government, but

instead allocates power between the state and federal

governments. On the basis of the nature of the

Commerce power as defined by the case law . . we

must agree with the interpretation of the Commerce

Clause as an allocating provision, not one that

secures rights cognizable under § 1983.

The Commerce Clause grants to Congress the

power to regulate interstate commerce. Gibbons v.

Ogden, 22 U.S. (9 Wheat.) 1, 6 L.Ed. 23 (1824).

That grant of power has been held to imply a limita-

tion upon the states. [Citations omitted. ]

It is clear from the language employed by the

Supreme Court in Commerce Clause cases that the

Commerce Clause deals with the relationship between

national and state interests, not the protection of

individual rights. These decisions are replete with

references to the national or federal interest in pre-

venting the burdensome state regulation of interstate

commerce. [Citations omitted. ]

In the Supreme Court’s opinion in this very case

the emphasis is on the role of the Commerce Clause

in preventing state regulation from “trespass[ing]

upon national interests.” Kassel v. Consolidated

Freightways, 450 U.S. 662, 669, 101 S.Ct. 1309,

1315, 67 L.Ed.2d 580 (1981) (emphasis added). In

striking down the Iowa truck-length limitations, the

Court stated that Iowa’s “regulations impair signifi-

cantly the federal interest in efficient and safe inter-

state transportation .. Jd. at 671, 101 S.Ct. at

1316 (emphasis added). No where does the Court

refer to the impairment, infringement, or protection

of the interests or rights of the individual. Through-

out the Commerce Clause cases the emphasis is on

the relationship between conflicting federal and state

interests, not the relationship between the individual

and the state. [Citation omitted. |

To support its theory that the Commerce Clause

secures rights cognizable under § 1983, Consolidated

has cited several Supreme Court cases which refer to

a Constitutional “right” to engage in interstate com-

merce. ... Although these cases do refer to engaging

in interstate commerce as a constitutional right, such

cases were not dealing with the question of whether

the Commerce Clause secures individual rights within

the meaning of § 1983. In Garrity [v. New Jersey,

385 U.S. 493, 87 8. Ct. 616, 17 L. Ed. 2d 562

(1967),] the reference to interstate commerce was

mere dictum, and in both Western Union [Tel. Co. v.

Kansas, 216 U.S. 1, 30 S. Ct. 190, 54 L. Ed. 355

(1910),] and Crutcher [v. Kentucky, 141 U.S. 47,

11 S. Ct. 851, 35 L. Ed. 649 (1891)], the focus of

the Court’s opinions was on the separation of powers

between the national and state legislatures. Despite

these references to a right to engage in interstate

commerce, we agree with the district court that the

Commerce Clause was adopted, and the dormant

Commerce Clause doctrine evolved, not to protect in-

dividual rights, but to further the national interest

in an efficient economy. Citation omitted. ]

Although individuals are oftentimes benefited

through the indirect protection resulting from the

limitations placed on the states through the dormant

Commerce Clause doctrine, such benefit is not the

same thing as a “right” secured by the Constitution

within the meaning of § 1983.

(Emphasis in original.) Consol. Freightways Corp. of

Del. v. Kassel, 730 F.2d 1139, 1144-45 (8th Cir. 1984).

The court concluded :

In Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473,

5 L.Ed.2d 492 (1961), Justice Douglas discerned

three purposes underlying the original enactment of

§ 1983: (1) to override discriminatory state laws;

(2) to provide a remedy where state law was inade-

quate; and (3) to provide a federal remedy where

the state remedy, although adequate in theory, was

not available in practice. [Citation omitted.] To

hold that an alleged violation of the Commerce Clause

constitutes an action cognizable under § 1983 would

fail to serve any of these purposes and would be an

unwarranted extension of the Civil Rights Act. We

do not believe that such a cause of action was within

the intent of the Congress that enacted the civil

rights statutes, nor do we believe that such an inter-

pretation of the scope of § 1983 is mandated by either

the language of § 1983 or the nature of the Com-

merce Clause. We therefore hold that § 1983 does

not provide a remedy for a dormant Commerce

Clause claim.

730 F.2d at 1146-47.

In Kraft v. Jacka, 872 F.2d 862 (9th Cir. 1989), the

plaintiffs brought a § 1983 action against members of

the Nevada Gaming Control Board after the board re-

fused to extend further licensing to the plaintiffs when

their I- year limited gaming licenses expired. The plain-

tiffs alleged their civil rights had been violated because

they had been deprived of protected property and liberty

interests without due process of law.

The U.S. Court of Appeals for the Ninth Circuit held

that the corporate plaintiffs had no protected property

interests in further licensing and could not state a claim

under § 1983 for an alleged violation of the commerce

clause. The plaintiffs also failed to establish a protected

interest in reputation. Since they had no protected prop-

erty or liberty interests, the plaintiffs coule not show that

their due process rights had been violated. The court

further held that the denial of the license application,

based partly on individual plaintiff Kraft’s personal asso-

ciation with an unsuitable person, did not violate Kraft’s

free association right.

The plaintiffs in Kraft also alleged that the board vio-

lated their constitutional rights by issuing a stop order

as to an out-of-state sale of corporate securities, con-

tending that the board’s action deprived them of corporate

property in violation of the commerce clause and, thus,

in violation of 1983. The court rejected this contention.

The Commerce Clause places restraints upon the

power of the states. Philadelphia v. New Jersey, 437

U.S. 617, 623, 98 S. Ct. 2531, 2535, 57 L.Ed.2d 475

(1978). It divides power between the states and the

federal government. We have previously stated that

10a

„1983 was not intended to encompass those consti-

tutional provisions which allocate power between the

state and federal government.” White Mountain

Apache Tribe v. Williams, 810 F.2d 844, 848 (9th

Cir. 1984) (Supremacy Clause, which establishes

federal-state priorities, does not secure individual

rights under § 1983), cert. denied, 479 U.S. 1060,

107 S.Ct. 940, 93 L.Ed.2d 990 (1987); see also Con-

solidated Freightways Corp. v. Kassel, 730 F.2d

1139, 1144 (8th Cir. 1984) (The Commerce Clause

is “an allocating provision, not one that secures

rights cognizable under § 1983.”), cert. denied, 469

U.S. 834, 105 S.Ct. 126, 83 L.Ed.2d 68 (1984).

Thus, assuming that the Board’s actions in any way

implicated the Commerce Clause, the plaintiffs cannot

state a cause of action under § 1983 for violation of

the Clause.

872 F.2d at 869.

In J & J Anderson v. Town of Erie, 767 F.2d 1469

(10th Cir. 1985), the board of trustees of the town of

Erie, Colorado, enacted an ordinance prohibiting any

ultralight aircraft from landing or taking off within

the town. The ordinance was enacted in response to

noise complaints. The plaintiffs, an ultralight aircraft

company and three pilots, brought a § 1983 action alleg-

ing that the ordinance denied them their rights to equal

protection and constituted a “taking” of their rights to

carry on a lawful occupation, to own and enjoy private

property, and of freedom of transit through navigable

airspace pursuant to 49 U.S.C. app. § 1304 (1982), in

violation of the just compensation clause of the fifth

amendment.

Although the issues between the parties were ulti-

mately resolved by the repeal of the ordinance, the plain-

tiffs requested costs and attorney fees pursuant to 42

U.S.C. § 1988. The plaintiffs argued that they would

have substantially prevailed on their § 1983 claim because

lla

certain federal regulations preempted the effect of the

ordinance. The U.S. Court of Appeals for the Tenth

Circuit stated:

The Commerce Clause does, by implication, limit

state and municipal authority to enact laws regulat-

ing interstate con.merce. . . . However, it has been

recognized that when a compelling public interest,

such as community safety, is involved, the states and

municipalities have a legitimate local concern which

may be regulated by a zoning ordinance, notwith-

standing the fact that such ordinance affects inter-

state commerce.

The Commerce Clause of the Constitution, Art .1,

8, el. 3, is a limitation upon the power of the states

to regulate commerce. However, state regulations

touching upon safety may be valid if they do not

place a substantial burden on interstate commerce.

.... In any event, the Commerce Clause deals with

the relationship between national and state interests,

and does not deal with the protection of individual

rights. Kassel v. Consolidated Freightways Corp.,

450 U.S. 662, 101 S.Ct. 1309, 67 L.Ed.2d 580 (1981);

Raymond Motor Transportation, Inc. v. Rice, 434

U.S. 429, 98 S.Ct. 787, 54 L.Ed.2d 664 (1978);

Bibb v. Navajo Freight Lines, 359 U.S. 520, 79 S.Ct.

962, 3 L.Ed.2d 1003 (1959). The Commerce Clause

does not secure rights cognizable under 42 U.S.C.

1983 in that a Commerce Clause violation would

not deprive an individual of any right, privilege, or

immunity secured by the Constitution. Consolidated

Freightways Corp. of Delaware v. Kassel, supra, 730

F.2d at 1144. Accordingly, the Court there held that

the claim for attorney’s fees pursuant to 42 U.S.C.

1988 was not well taken.

767 F.2d at 1476. The court held:

The Commerce Clause and the Supremacy Clause,

although limiting the power of the states to inter-

12a

fere in areas of national concern, do not secure rights

cognizable under § 1983. This section was enacted

to insure a “right of action to enforce the protec-

tions of the Fourteenth Amendment and the federal

laws enacted thereto.” Chapman v. Houston Welfare

Rights Organization, supra, 441 U.S. at 611, 99

S.Ct. at 913. Thus, § 1983 does not provide a remedy

for claims resulting from violations of the Commerce

Clause or the Supremacy Clause. It follows that an

attorney's fee claim under £ 1988, based on a § 1983

action involving an alleged violation of the Com-

merce Clause and the Supremacy Clause of the Con-

stitution of the United States, can have no merit.

767 F.2d at 1476-77. The court further found that the

plaintiffs could not have substantially prevailed on their

1983 “taking” claim and were not entitled to attorney

fees pursuant to § 1988.

In Pesticide Public Policy v. Village of Wauconda,

622 F. Supp. 423 N. D. III. 1985), aff'd 826 F.2d 1068

(7th Cir. 1987), the plaintiff foundation challenged the

validity of an ordinance regulating the use of pesticides

in the defendant village. The foundation claimed that the

village lacked authority to enact the ordinance and that

the ordinance was preempted by Illinois law. The founda-

tion further claimed that the ordinance denied foundation

members due process and equal protection of law, consti-

tuted special legislation, and violated the commerce

clause of the U.S. Constitution. The foundation also

contended that the village was liable to individual founda-

tion members for money damages pursuant to 1983.

The court held that Illinois state law preempted the

village’s regulation of pesticides. The ordinance, there-

fore, was invalid under Illinois law.

As to 1983 liability, the court held that the founda-

tion did not have standing to sue for a declaration that

its members were entitled to damages. The court found

—

13a

that, even if the foundation had standing, damages were

not available as a matter of law under any of the

foundation’s § 1983 claims:

Section 1983 was enacted to override discrimina-

tory state laws and provide a remedy where state

law was inadequate or unenforced. Monroe v. Pape,

365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961).

The appellate courts reasoned that the function of

both the Supremacy Clause and the Commerce Clause

relates not to individual rights, but rather to the

distribution of power between the state and federal

governments. “Both the Supremacy and Commerce

Clauses ‘limit the power of a state to interfere with

areas of national concern.’” Gould, Inc. v. Wiscon-

sin Dept. of Industry, Labor, 750 F.2d 608, 616 7th

Cir. 1984), quoting Consol. Freightways Corp. of

Del. v. Kassel, 730 F.2d 1139 (8th Cir. 1984).]

Thus, the Seventh Circuit declined to award attor-

neys’ fees under 42 U.S.C. § 1988 based solely on

Gould’s success on its federal preemption claims,

just as the Eighth Circuit refused to award attor-

neys’ fees based on a Commerce Clause violation.

Therefore, even if the Foundation succeeded on its

federal preemption claim, Count I, that would not

entitle it to a declaration that the Village is liable

for damages under Section 1983. Likewise, Count

V of the complaint, which alleges that the Wauconda

ordinance violates the Commerce Clause, does not

provide a basis for damages under Section 1983.

622 F. Supp. at 435-36.

The court further held that the ordinance did not de-

prive foundation members of equal protection of the laws

or violate the Illinois Constitution’s prohibition against

special legislation.

In Private Truck Council v. Secretary of State, 503

A.2d 214 Me. 1986), a class action was brought by and

14a

on behalf of out-of-state truckers, contesting the validity

of Maine's reciprocal truck taxes. An escrow fund com-

prised of all moneys collected under the disputed statute

after January 2, 1985, was established during the pend-

ency of the action. The trial court found that the statute

was in violation of the commerce clause, but refused to

order any refund of tax moneys “except to the extent that

the plaintiff class had been protected by the] escrow

arrangement Id. at 216. The trial court also

denied the plaintiffs’ request for allowance of attorney

fees. The State appealed the trial court’s action in declar-

ing the statute unconstitutional. The plaintiffs also ap-

pealed, contending that their relief should not be limited

to reimbursement of the funds in escrow and that they

were entitled to recover attorney fees pursuant to § 1988

because they brought their action alternatively under

1983.

In affirming the decision of the trial court, the Supreme

Judicial Court of Maine held that the statute was in vio-

lation of the commerce clause and determined that the

trial court properly ordered a refund of only the moneys

held in escrow. The court further held that the plaintiffs

were not entitled to recover attorney fees pursuant to

1988.

PI laintiffs failed . . . to state a claim for relief

cognizable under section 1983. We are convinced that

Congress never intended to make a violation or the

Commerce Clause actionable under that section of

the Civil Rights Act. The Eighth Circuit has so held

in a well-reasoned opinion in Consolidated Freight-

ways Corp. v. Kassel, 730 F.2d 1139 (8th Cir.), cert.

denied, 469 U.S. 834], 105 S.Ct. 126, 83 L.Ed.2d 68

(1984). Although the United States Supreme Court

has not addressed this issue so far as the Commerce

Clause is concerned, it did hold in Chapman v.

Houston Welfare Rights Organization, 441 U.S. 600,

99 S.Ct. 1905, 60 L.Ed.2d 508 (1979), that the

15a

Supremacy Clause does not give rise to a claim of

right “secured by the Constitution” within the mean-

ing of 28 U.S.C. § 1343/3), a jurisdictional counter-

part to section 1983. Id. at 615, 99 S.Ct. at 1914.

See also Gould, Inc. v. Wisconsin Department of In-

dustry, Labor and Human Relations, 750 F.2d 608,

616 (7th Cir. 1984) (Supremacy Clause violation

does not present a cognizable claim under section

1983).

503 A.2d at 221. The court adopted the reasoning of

Consol. Freightways Corp. of Del. v. Kassel, 730 F.2d

1139 (8th Cir. 1984), and stated:

We find unpersuasive, as did the Eighth Circuit,

two earlier federal cases stating terse holdings going

the other way. Kennecott Corp. v. Smith, 637 F.2d

181, 1 n.5 (3d Cir. 1980); Confederated Salish

and Kootenai Tribes v. Moe, 392 F.Supp. 1297, 1304-

05, (D. Mont. 1975), aff'd, 425 U.S. 463, 96 S.Ct.

1634, 48 L.Ed.2d 96 (1976). Neither of those cases

analyzed the merits of extending section 1983 to

encompass violations of the Commerce Clause, but

rather merely relied on generalized statements in

Supreme Court cases that did not involve the Com-

merce Clause issue. Consolidated Freightways, 730

F.2d at 1142-43.

503 A.2d at 222.

In Private Truck Council of America v. State, 128

N.H. 466, 517 A.2d 1150 (1986), the New Hampshire

Supreme Court held that a state statute imposing taxes

and fees on motor carriers whose vehicles were registered

in nine other states discriminated against interstate com-

merce, in violation of the commerce clause. The court also

determined that the plaintiffs (which were corporations)

had not been properly certified as a class and, therefore,

could not invoke the protection of the privileges and im-

munities clause, U.S. Const. art. IV, § 2, el. 1.

loa

The court held that the plaintiffs were not entitled to

tax refunds or attorney fees pursuant to § 1988:

The purposes underlying the original enactment of

section 1983 were to override discriminatory state

laws, to provide a remedy where state law was in-

adequate, and to provide a federal remedy where the

state remedy, although adequate in theory, was un-

available in practice. Monroe v. Pape, 365 U.S. 167,

173-74 (1961), overruled on other grounds, Monell v.

New York City Dept. of Social Services, 436 U.S.

658 (1978). Although the plaintiffs argue that sec-

tion 1983 provides redress for “any” violation of

constitutional or federal statutory rights, section

1983 has not been so construed. See Chapman v.

Houston Welfare Rights Organization,, 441 U.S. 600,

615-20 (1979) (supremacy clause violation not re-

dressable under § 1983); Poirer v. Hodges, 445 F.

Supp. 838, 842 (M.D. Fla. 1978) (contract clause

violation not redressable under § 1983.

We do not believe that the purposes of section

1983 would be furthered by a holding that a viola-

tion of the commerce clause is redressable through an

action under that statute. The United States Court

of Appeals for the Eighth Circuit has held that a

violation of the commerce clause is not a basis for

applying section 1983. Consol. Freightways Corp. of

Del. v. Kassel, 730 F.2d 1139 (8th Cir.), cert. denied,

105 S.Ct. 126 (1984) ;,see also Private Truck Council

v. Secretary of State, 503 A.2d at 220-22. But see

Kennecott Corp. v. Smith, 637 F.2d 181, 186 n.5 (3d

Cir. 1980); Confederated Salish & Kootenai Tribes

„. Moe, 392 F. Supp. 1297, 1304-05 D. Mont. 1974),

aff'd on other grounds, 425 U.S. 463 1976). The

Eighth Circuit based its holding on the ground that

the commerce clause does not establish individual

rights, but rather allocates power between State and

federal governments. Kassel, supra at 1144.

— — — —ä— — —

reas national concern. Just as the Supremacy

Clause does not secure rights within the meaning

of § 1983, neither does the Commerce Clause.” Kas-

sel, 730 F.2d at 1144 (footnote omitted). “The Com-

merce Clause created no rights or privileges; it

established no law other than the law of jurisdiction

to regulate those engaged in interstate or foreign

commerce.” Id. at 1145 (quoting B. GAVIT, COM-

MERCE CLAUSE, 32-33 1932. The Eighth Cir-

cuit concluded that “{ajlthough individuals are

oftentimes benefited through the indirect protection

resulting from the limitations placed on the states

through the dormant Commerce Clause doctrine, such

benefit is not the same thing as a ‘right’ secured by

the Constitution within the meaning of § 1983.” Id.

We agree that a commerce clause violation is not

redressable under section 1983. We therefore deny

the plaintiffs’ claims for refunds of taxes paid before

the establishment of the escrow fund. The plaintiffs’

claims for attorney's fees also must fail. The plain-

tiffs have not stated a cause of action under section

1983, and thus cannot recover attorney’s fees under

42 U.S.C. § 1988 (1982), which provides for attor-

ney's fees in, inter alia, section 1983 actions.

128 N.H. at 476-77, 517 A.2d at 1157.

In Private Truck Council v. State, 221 N.J. Super. 89,

534 A.2d 13 (1987), aff'd 111 NJ. 214, 544 A.2d 33

(1988), the plaintiffs challenged the constitutionality of

a retaliatory tax imposed on certain trucking operations,

claiming that New Jersey’s Counterpart Fee Act vio-

lated the commerce clause and the privileges and im-

munities clause of the U.S. Constitution. The plaintiffs

also contended that they were entitled ‘» refunds of the

moneys unlawfully collected, as well as counsel fees and

costs under 19

18a

The appellate division of the New Jersey Superior

Court determined that the tax was in violation of the

commerce clause and found that the plaintiffs were en-

titled to refunds from the date their complaint was filed.

The court did not consider the merits of the plaintiffs’

claim that the act was unconstitutional under the

leges and immunities clause. With respect to the plain-

tiffs’ request for counsel fees, the court held:

It is sufficient to note that 42 U.S.C. § 1983 was

not intended to apply to this type of action. See

Consol. Freightways Corp. of Del. v. 730

F.2d 1139, 1145-1147 (8th Cir. 1984), cert. den. 469

U.S. 834, 105 S.Ct. 126, 83 L.Ed.2d 68 (1984);

Private Truck Council v. Secretary of State, 505

A. 2d] at 220-222; Private Truck Council of America

v. State, 128 N.H. at 466, 517 A.2d at 1156-57.

221 N.J. Super. at 97, 534 A.2d at 18.

Finally, in State of Ga. v. Private Truck Council &c.,

258 Ga. 531, 371 S.E.2d 378 (1988), the Supreme Court

of Georgia held that state statutes imposing highway user

taxes on vehicles registered in certain states unconsti-

tutionally discriminated against interstate commerce. The

court, however, held that the plaintiffs were not entitled

to attorney fees under § 1988.

We agree with the state that plaintiffs may not

recover attorney fees under 42 USC § 1988 for the

Commerce Clause violation in this case. Consolidated

Freightways Corp. of Delaware v. Kassel, 730 F2d

1139 ‘(8th Cir. 1984); Private Truck Council of

America, Inc. v. Secretary of State, 503 A2d, supra;

Private Truck Council of America, Inc. v. State of

New Hampshire, 517 A2d, supra.

258 Ga. at 535, 371 S.E.2d at 381.

In addition to his commerce clause claim, the plaintiff

further alleged that §{ 60-305.02 and 60-305.03 (Reissue

19a

1984) were in violation of the privileges and immunities

clause, U.S. Const. art. IV, § 2, el. 1, which provides:

“The Citizens of each State shall be entitled to all Privi-

leges and Immunities of Citizens in the several States.”

Section 1983 embodies individual rights cognizable under

the privileges and immunities clause. Intern. Organiza-

tion of Masters, Etc. v. Andrews, 831 F.2d 843 (9th

Cir. 1987).

In his second amended petition the plaintiff alleged:

2. Plaintiff Mark E. Dennis owns and operates

Dennis Trucking, a sole proprietorship with its

principal place of business in Ohio. He is an owner

of a nonresident vehicle for purposes of the taxes and

fees imposed under Sections 60-305.02 and 60-305.03,

which vehicle is duly authorized to operate in the

State of Nebraska.

13. Plaintiff Mark E. Dennis owns one vehicle,

which is registered in the State of Ohio

17. The retaliatory taxes and fees imposed pur-

suant to Sections 60-305.02 and 60-305.03 constitute

a denial of the privileges and immunities of the plain-

tiff, whose vehicle is registered outside the State of

Nebraska, because they are imposed based on the

taxpayer’s residence in another state. No comparable

tax is imposed on residents of Nebraska. Accord-

ingly, these taxes discriminate against nonresidents

in violation of the Privileges and Immunities Clause

of Article IV, Section 2, Clause 1 of the United

States Constitution.

The trial court resolved this issue against Dennis.

In considering a statute challenged on the basis of the

privileges and immunities clause, a distinction must be

made based upon residence or citizenship.

20a

The plaintiff operates one tractor and two trailers in

interstate commerce. Since his tractor is registered in

Ohio, he is subject to taxation under §§ 60-305.02 and

60-305.03 when he operates in Nebraska. Pursuant to a

reciprocity agreement between Nebraska and Ohio, own-

ers of vehicles which are registered in Ohio are granted

full license reciprocity for interstate movement in Ne-

braska and pay no registration fees to Nebraska; how-

ever, when operating in Nebraska, owners of such ve-

hicles must pay a fee of 1 to 2 cents per mile. This

fee mirrors a like charge imposed by Ohio on owners of

Nebraska-registered vehicles which operate in Ohio.

The purpose of the privileges and immunities clause

“is to outlaw classifications based on the fact of non-

citizenship unless there is something to indicate that

non-citizens constitute a peculiar source of the evil at

which the statute is aimed.” Toomer v. Witsell, 334

U.S. 385, 398, 68 S. Ct. 1156, 92 L. Ed. 1460 (1948).

The clause does bar discrimination against citizens

of other States where there is no substantial reason

for the discrimination beyond the mere fact that they are

citizens of other States.“ Hicklin v. Orbeck, 437 U.S.

518, 525, 98 S. Ct. 2482, 57 L. Ed. 2d 397 (1978), quot-

ing Toomer v. Witsell, supra. “Only with respect to

those ‘privileges’ and ‘immunities’ bearing upon the vi-

tality of the Nation as a single entity must the State

treat all citizens, resident and nonresident, equally.”

Baldwin v. Montana Fish and Game Comm’n, 436 U.S.

371, 383, 98 S. Ct. 1852, 56 L. Ed. 2d 354 (1978). “The

Privileges and Immunities Clause, by making nonciti-

zenship or nonresidence an improper basis for locating

a special burden, implicates not only the individual’s right

to nondiscriminatory treatment but also, perhaps more

so, the structural balance essential to the concept of

federalism.” Austin v. New Hampshire, 420 U.S. 656,

662. 95 S. Ct. 1191, 43 L. Ed. 2d 530 (1975).

Section 60-305.02 provided:

21a

Trucks, truck-tractors, semitrailers, trailers, or

buses, from states other than Nebraska, entering

Nebraska shall be required to comply with all the

laws and regulations of any nature imposed on

Nebraska trucks. . . and to comply with all the

requirements as to payment of all license fees, per-

mit fees, and fees of whatever character which

owners of trucks . . owned and operated in Ne-

braska, are required to pay when operating in such

foreign state, unless the state or states, in which

such trucks . . are domiciled, grant reciprocity

comparable to that extended by the laws of Nebraska.

(Emphasis supplied.

Section 60-305.03 provided:

(1) In case a foreign state .. is not reciprocal

as to license fees on commercial trucks . . . the

owners of such nonresident vehicles from those states

or territories will be required to pay the same li-

cense fees as are charged residents of this state in

such foreign state or territory. In case no fees are

charged in Nebraska on trucks . . other than

license fees, and the reciprocity law of any other

foreign state . . . does not act to exempt Nebraska

trucks . . . operating in that state from payment

of all fees whatsoever, the owners of such foreign

trucks . . . shall be required to pay a fee in an

amount equal to the fee of whatever character, other

than license fee, is charged by such other state to

foreign trucks

(7) Properly registered shall mean a vehicle li-

censed or registered in one of the following: .. .

(b) the jurisdiction in which a commercial vehicle

is registered, where the operation in which such ve-

hicle is used has a principal place of business therein,

and from or in which the vehicle is most frequently

22a

dispatched, garaged, serviced, maintained, operated,

or otherwise controlled, and the vehicle is assigned

to such principal place of business

(Emphasis supplied. )

The plaintiff contends that because § 60-305.03 im-

poses taxes only upon “ ‘the owners of . . . nonresident

vehicles,“ and not on residents of Nebraska, the chal-

lenged taxes and fees “clearly deny the former substan-

tial equality of treatment with the latter.” Brief for

appellant at 26. The taxation imposed pursuant to

$$ 60-305.02 and 60-305.03 is not related to the resident

or_nonresident status of the motor carrier, but is based

upon the state where the particular vehicle is registered.

If a citizen of Nebraska owned a vehicle registered in a

state which imposed third-structure taxes on vehicles

registered in Nebraska (i.e., Arkansas, Arizona, Idaho,

Wyoming, New York, Pennsylvania, Oregon, Nevada, or

Ohio), the Nebraska citizen would be subject to retalia-

tory taxation pursuant to §§ 60-305.02 and 60-305.05.

In this respect, the owners of foreign-registered vehicles

who are not citizens or residents of Nebraska are treated

no differently from the owners of foreign-registered ve-

hicles who are citizens of Nebraska. Since the statutes

do not make a distinction based upon residence or citi-

zenship, the statutes do not violate the privileges and

immunities clause.

Furthermore, only an out-of-state citizen has standing

to bring a challenge under the privileges and immunities

clause. See Bradwell v. The State, 83 U.S. (16 Wall.)

130 (1872); White v. Thomas, 660 F.2d 680 (5th Cir.

1981), cert. denied, 455 U.S. 1027, 102 S. Ct. 1731, 72

L. Ed 2d 148 (1982). The second amended petition does

not allege that the plaintiff is a citizen of another state,

only that he owns and operates Dennis Trucking, a sole

proprietorship with its principal place of business in

Ohio, that his truck is registered in Ohio, and that he

ES eS Be

23a

is subject to taxation because his truck is registered

in Ohio.

The case was tried on a stipulated record consisting

of two exhibits: a stipulation of facts and the affidavit

of the Lancaster County assessor. There was no proof

that the plaintiff is a citizen of another state.

There was no error in dismissing the plaintiff’s claim

based on a violation of the privileges and immunities

clause. The statutes do not discriminate on the basis

of citizenship or residency, and there was no proof that

the plaintiff was a citizen of another state and had

standing to pursue a claim under the privileges and

immunities clause.

By the cross-appeal the defendants contend that the

trial court erred in finding that the plaintiff and his

attorneys were entitled to payment of their expenses and

reasonable fees under the equitable fund doctrine. This

finding was in error for several reasons.

A statement of the common fund doctrine is found in

Summerville v. North Platte Valley Weather Contro!

Dist., 171 Neb. 695, 696-97, 107 N.W.2d 425, 427 (1961):

[Where one has gone into a court of equity and,

taking the risk of litigation on himself, has created

or preserved or protected a fund in which others are

entitled to share, such others will be required to con-

tribute their share to the reasonable costs and ex-

penses of the litigation, including reasonable fees to

the litigant’s counsel.

The doctrine presupposes the existence of a fund. As

the court in Crane Towing v. Gorton, 89 Wash. 2d 161,

176-77, 570 P.2d 428, 437 (1977), said: “As the name

implies, the ‘common fund’ doctrine requires the prevail-

ing party to have brought suit to preserve or protect a

fund which benefits the party and others.”

24a

There is no fund in this case, much less a fund within

the jurisdiction of the trial court.

The common fund must be an immediate fund from

which attorney’s fees may be awarded at trial.

Seattle Sch. Dist. 1 v. State, 90 Wn.2d 476, 585 P.2d

71 (1978). The effect of this litigation may well

benefit other nursing homes in the state. However,

it did not create a presently existing common fund at

trial from which reasonable attorney’s fees could be

awarded.

United Nursing Homes v. McNutt, 35 Wash. App. 632,

643, 669 P.2d 476, 483 (1983).

In Hoffman v. Lehnhausen, 48 III. 2d 323, 329, 269

N.E.2d 465, 469 (1971), the Supreme Court of Illinois

said:

Several considerations set this case apart from the

usual situation in which attorneys fees are allowed

from a fund brought into court by one who sues as

a member of a class. No fund was involved in this

case. The attorneys for the plaintiffs say that this

circumstance is irrelevant, because the trial judge

refused to enter an order which would have created

such a fund. Again we think, however, that the rul-

ing of the trial court was correct. We are aware of

no authority under which the process of tax collection

and distribution could have been interrupted to di-

vert from the governmental bodies that had levied

the taxes an amount fixed by the court as fees for

the attorneys for the plaintiffs.

In Lebanks v. Spears, 417 F. Supp. 169, 174 (E. D.

La. 1976), the court said:

Mills ſv. Electric-Auto Lite, 396 U.S. 375, 90 S. Ct.

616. 24 L. Ed. 2d 593 (1970),] and Hall [v. Cole,

412 U.S. 1, 93 S. Ct. 1943, 36 L. Ed. 2d 702 (1973.

and the discussion of the common fund theory in

25a

Alyeska [Pipeline Co. v. Wilderness Society, 421

U.S. 240, 95 S. Ct. 1612, 44 L. Ed. 2d 141 19753

require for an award of attorneys’ fees under the

common benefit rationale (1) an ascertainable class

of beneficiaries, easily identifiable, and (2) a source

of funds common to the class from which the award

can be made. Public interest litigation generally

cannot niet these requirements. Actions to vindicate

constitutional rights which benefit the public usually

can present only the “private attorney general”

theory for the award of attorneys’ fees. Prevailing

parties in public interest litigation ought not to be

permitted, by emphasizing the importance of enforc-

ing constitutional rights, to attach the “common

benefit” label to what is really the “private attorney

general” theory, and ultimately to merge the two

In Hamer v. Kirk, 64 III. 2d 434, 442, 356 N.E.2d 524,

528 (1976), the court said: In the absence of a fund,

a plaintiff’s attorney is not entitled to attorney’s fees

merely because he has conferred a benefit upon members

of a class.” The court held that because no fund had been

created, nor did the court have the authority to create a

fund, the substantial benefit theory did not apply to the

facts presented. The court further held that no statutory

authority existed on which to base an award of attorney

fees under the private attorney general theory. The order

of the trial court denying an award of attorney fees to

the plaintiffs was affirmed.

In Hamer v. Kirk, supra, the Supreme Court of Illinois

held attorney fees could not be awarded under the com-

mon fund doctrine where there was no fund within the

control of the court. The Supreme Court reviewed its

prior decisions in Rosemont Bldg. Sup. v. Highway T.

Auth., 51 II. 2d 126, 281 N.E.2d 338 (1972). and The

People v. Holten, 304 III. 394, 136 N. E. 738 (1922), in

which the court recognized that if a fund is to serve as

a source of attorney fees, said fund must be under the

court. In Hamer, supra at 441, 356 N.E.2d

at 527, the court concluded that since no fund had

been placed under control of the court in the instant case,

the trial court was without authority to award attorney’s

fees to the petitioner.” See also, Van Emmerik v. Mon-

tana Dakota Utilities Co., 332 N.W.2d 279 (S.D. 1983),

cert. denied 464 U.S. 915, 104 S. Ct. 278, 78 L. Ed. 2d

257: Eckford v. Borough of Atlanta, 173 Ga. 650, 160

S.E. 773 (1931); Fitzgerald v. City of Philadelphia, 87

Pa. Commw. 482, 487 A.2d 485 (1985); Von Holt v.

Izumo Taisha Mission, 44 Haw. 147, 355 P.2d 40 (1960),

aff'd on rehearing 44 Haw. 365, 355 P.2d 44; Satoskar v.

Indiana Real Estate Commission, 517 F.2d 696 (7th Cir.

1975), cert. denied 423 U.S. 928, 96 S. Ct. 276, 46 L. Ed.

2d 256 (1975); Townsend v. Edelman, 518 F.2d 116

(7th Cir. 1975).

In Private Truck Council of America v. State, 128

N.H. 466, 477, 517 A.2d 1150, 1157 (1986), a suit nearly

identical to the case at bar, the Supreme Court of New

Hampshire found that the plaintiffs had “not demon-

strated a common law right to attorney’s fees under the

theory of a ‘common fund’ for the benefit of a class be-

cause, as we have indicated, this action has not

properly certified as a class action.”

Each person who may be entitled to a refund must

individually file a separate claim for a refund. Each such

claim may be denied for a variety of reasons. The merits

of each claim for a refund must be determined on a case-

by-case basis. There is no evidence that anyone, including

the plaintiff, has filed a claim and is entitled t a tax

27a

no jurisdiction of other persons who may have paid the

invalid taxes or any way of knowing whether such

amounts would be subject to a refund if claims were

made.

There was no basis upon which an award of attorney

fees could have been made against the State of Nebraska

because the State has not waived its sovereign immunity

as to attorney fees under circumstances such as this case.

See, Neb. Const. art. V, § 22; Gentry v. State, 174 Neb.

515, 118 N.W.2d 643 (1962).

The judgment of the district court is affirmed, except

as to that part which provides: “The plaintiff and his

attorneys are entitled under the Equitable Fund Doctrine

to payment of their expenses and reasonable fees. That

part of the judgment is reversed.

AFFIRMED IN PART,

AND IN PART REVERSED.

FAHRNBRUCH, J., not participating.

28a

APPENDIX B

IN THE DISTRICT COURT

OF LANCASTER COUNTY, NEBRASKA

— —

Docket 390 Page 26

Mank E. DENNIS, d ba Dennis Trucking,

Plaintiff,

vs.

STATE OF NEBRASKA, et al.,

Defendants.

ORDER

This matter came before the Court on June 3, 1987,

for trial on the plaintiff’s second amended petition. The

plaintiff appeared by his attorneys, Richard A. Allen and

Richard L. Spangler, Jr. The defendants appeared by

their attorneys, Special Assistant Attorney General Ruth

Anne Evans and Assistant Attorney General Jill Grad-

wohl Schroeder. Trial was held upon stipulation of facts

received in evidence as Exhibit No. 1 and Exhibit No. 2,

the affidavit of County Assessor Robert McGee, which

set forth the various valuations used by the Lancaster

County Assessor for the purpose of assessing ad valorem

taxes on various models of 1979 truck-tractors. Exhibit

No. 2 was received in evidence over the objections of the

plaintiff. The matter was then argued and submitted to

the Court on briefs. The Court being fully advised, now

finds and orders as follows:

1. This is an action for a declaratory judgment to

declare retaliatory taxes imposed by Nebraska Revised

Statute _$5 60-305.02 and 60-305.03 unconstitutional, and

to enjoin the defendants from enforcing and collecting

the tax.

2. The Court adopts as its findings of fact the stipula-

tions of facts received in evidence as Exhibit No. 1 and

the affidavit setting forth valuations of various models of

1979 truck-tractors received in evidence as Exhibit No. 2.

3. The plaintiff is entitled to judgment on Count I of

his second amended petition declaring that the retaliatory

taxes and fees imposed on plaintiff pursuant to §§ 60-

305.02 and 60-305-03, Revised Statutes of Nebraska, are

unconstitutional in that they constitute an unlawful

burden on interstate commerce in violation of the Com-

merce Clause of Article I, Section 8, Clause 3 of the

United States Constitution because they are imposed only

on motor carriers whose vehicles are registered outside

the State of Nebraska, while no comparable tax or fee is

imposed on carriers whose vehicles are registered in the

State of Nebraska. On their face said taxes and fees

discriminate against interstate commerce.

4. The plaintiff has failed to sustain his burden of

proving that he is entitled to judgment on Count II,

denial of privileges and immunities, Count II, violation of

Article III, Section 18 of the Constitution of the State

of Nebraska, and Count IV, violation of 42 U.S.C. § 1983.

5. The plaintiff and his attorneys are entitled under

the Equitable Fund Doctrine to payment of their expenses

and reasonable fees. The Court shall determine the

amount of any such expenses and fees by subsequent

order following the submission of documentation regard-

ing the fund from which said expenses and fees may be

paid.

WHEREFORE, IT IS ORDERED, ADJUDGED AND

DECREED that the retaliatory taxes and fees imposed on

plaintiff pursuant to ££ 60-305.02 and 60-305.03, Revised

Statutes of Nebraska, are unconstitutional in that they

constitute an unlawful burden on in‘erstate commerce in

violation of the Commerce Clause of Article I, Section 8,

Clause 3 of the United States Constitution. The defend-

ants are permanently enjoined from assessing, levying

or collecting taxes or fees pursuant to said statutes.

The plaintiff has failed to sustain his burden of proving

that he is entitled to judgment on Counts II, III and IV

of the second amended petition and said Counts II, III

and IV should be and they are hereby dismissed. Costs

of this action are taxed to the defendants in their official

capacities.

The plaintiff and his attorneys are entitled under the

Equitable Fund Doctrine to payment of their expenses

and reasonable fees. The Court shall determine the

amount of any such expenses and fees by subsequent order

following the submission of documentation in support

thereof and a showing regarding any fund available for

payment of said fees and expenses.

The Court now having found that the retaliatory taxes

and fees imposed pursuant to 60-305.02 and 60-305.03,

Revised Statutes of Nebraska, are unconstitutional. The

Court now pursuant to its order of June 17, 1985, finds

that today’s order shall be applicable to all persons af-

fected thereby. Each person affected will be required to

submit a claim to the Department of Administrative

Services as provided in 77-2406. Revised Statutes of

Nebraska. In addition, each of the persons requesting a

refund will be required to show proof of the date of pay-

ment, the amount paid, whether or not such payments

were voluntary, and shall be required to provide such

other information and proof as deemed necessary by the

Department of Administrative Services.

DATED AND SIGNED this 30th day of September,

1987.

By THE Court:

‘s’ Bernard J. McGinn

BERNARD J. McGINN

District Judge

31a

APPENDIX C

IN THE DISTRICT COURT

OF LANCASTER COUNTY, NEBRASKA

Docket 390 Page 26

PRIVATE TRUCK COUNCIL OF AMERICAN, INC., and DENNIS

TRUCKING, on behalf of themselves and others similarly

situated, Plaintiffs,

STATE OF NEBRASKA; HOLLY JENSEN, Director, Nebraska

Defendants.

(Reissue 1979), filed a Motion for Change of Venue to-

gether with a Motion for Continuance of the hearing on

plaintiff's Motion for Preliminary Injunction. Each in-

dividual defendant also filed separate Demurrers to the

Petition of the plaintiffs. All of the foregoing Motions

were set for hearing on January 21, 1985, before the

Honorable John E. Clark, District Court Judge.

On January 21, 1985, the plaintiffs appeared by and

through their counsel, John F. Thomas and Jacob P.

Billig. Defendants appeared by and through their coun-

sel, Ruth Anne E. Galter

were heard on defendants’ Motion Change of Venue

and Motion for Continuance the hearing for Pre-

per J. Clark, and the cause of action

ferred to the District Court of Lancaster Courty,

braska, on January 22, 1985. The record reflects

the same was entered at Docket 390, Page

Lancaster County District Court on

In this court, plaintiffs then filed a Motion to

the Class and a Motion for Summary Judgment.

fendan‘s filed a Motior to Strike the plaintiffs’

for Summary Judgment. A hearing was held on

18, 1985, before the Honorable Dale E. Fahrnbruch,

trict Court Judge. Plaintiffs appeared by and

their counsel, Richard I. Spangler, Jr. Defendants ap-

peared by and through their counsel Ruth Anne E. Galter.

The Motion to Strike was argued, submitted, and sus-

tained for the reason that no issues had been framed since

defendants had not yet answered plaintiff's Petition.

Therefore, the filing of a Motion for Summary Judgment

by plaintiffs was premature.

Thereafter, on March 22, 1985, with all counsel present,

a hearing was held on plaintiffs’ Motion for Preliminary

injunction or in the Alternative to Require Placement of

Tax Collections in Escrow, on plaintiffs’ Motion to Certify

the Class, and on the Demurrers of defendants, and each

of them. Evidence was adduced, all matters were argued,

and the parties submitted briefs in support of their

respective positions.

The Court, now being fully advised in the premises,

finds from the pleadings that, although the plaintiffs refer

in paragraph 10 of their Petition to a “fuel tax on the

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consumption of motor fuel within the State,” the cause of

action is, in fact, related only to what plaintiffs have

alleged to be “retaliatory taxes” imposed pursuant to

Neb.Rev.Stat. 8 60-305.02 and 60-305.03 (Reissue 1984).

The Court finds from the pleadings, files, and argu-

ments of counsel, that plaintiff Private Truck Council of

America, Inc. has no legal standing in this lawsuit and

therefore no standing to be a party plaintiff and is not

the real party in interest. The Court further finds that

Dennis Trucking, according to the pleadings, is an un-

incorporated motor carrier and as such is not a legal

entity. Therefore Dennis Trucking has no legal capacity

to bring this action. It is apparent from the briefs of

plaintiffs and the Affidavit filed in support of the Motion

for Preliminary Injunction that Dennis Trucking is op-

erated by one or more individuals, doing business as

Dennis Trucking. However, the Court finds that desig-

nating a plaintiff as Dennis Trucking does not place

before this Court the individuals owning and or operating

that business. Therefore, in the event of taxing of costs,

the Court cannot assess costs against Dennis Trucking.

The Court finds that pursuant to Article VIII, Section

9, of the Constitution of the State of Nebraska that

At he Legislature shall provide by law that all claims

upon the treasury shall be examined and adjusted as

the Legislature may provide before any warrant for the

amount allowed shall be drawn.” The Court finds that the

Legislature has provided that “all claims of whatever

nature upon the treasury of this state, before any war-

rant shall be drawn for the payment of the same, shall

be examined, adjusted and approved by the Department

of Administrative Services. No warrants shall be drawn

for any claim until an appropriation shall have been

made therefore.” Neb.Rev.Stat. § 77-2406 (Reissue 1981).

The Legislature has further provided the method by

which plaintiffs may attack the validity of the imposition

of a tax:

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If a person who claims a tax or any part thereof to

be invalid for any reason other than the valuation

of the property shall have paid the same to the treas-

urer or other proper authority in all respects as

though the same was legal and valid, he or she may,

at any time within thirty days after such payment,

demand the same in writing from the county treas-

urer to whom paid. If the same shall not be refunded

within ninety days thereafter, he or she may sue

such county treasurer for the amount so demanded.

Upon the trial, if it shall be determined that such

tax or any part thereof was for any reason invalid,

judgment shall be rendered therefor with interest

and such judgment shall be collected as in other

cases.

Neb. Rev. Stat. § 77-1735 (Supp. 1984).

The Court finds that it cannot, in a proceeding such

as this, order a refund of taxes, nor does this Court have

the authority to order the same to be placed in escrow at

interest. Therefore, the plaintiffs’ Motion for Preliminary

Injunction or in the Alternative to Require Placement of

Tax Collections in Escrow should be denied. The Court is

not finding that it cannot enjoin the collection of taxes

should the Court find the operational law unconstitutional.

The Court finds that the Motion to Certify the Class

should also be denied for the reason that the instant cause

of action is not a proper class action. If the Court deter-

mines the law to be unconstitutional, that determination

will be applicable to all persons affected thereby. In the

event of such a determination, each person affected will

be required to submit a claim to the Department of Ad-

ministrative Services as provided in Neb.Rev.Stat. § 77-

2406. In addition, each of the persons requesting a refund

would be required to show proof of the date of payment,

the amount paid, whether or not such payments were

made voluntarily, and would be required to provide such

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other information and proof as deemed necessary by the

Department of Administrative Services. The resolution

of such claims must be determined on a case by case basis

depending upon the individual proof submitted in support

of each claim. Consequently, class resolution of such

claims is inappropriate and improper.

The Court finds that the Demurrers of the Defendants,

and each of them, should be sustained for the reason that

there are no proper plaintiffs before this Court with

standing or legal capacity to bring the instant cause of

action.

IT IS THEREFORE ORDERED THAT plaintiffs’

Motion for Preliminary Injunction or in the Alternative

to Require Placement of Tax Collections in Escrow and

plaintiffs’ Motion to Certify the Class should be and the

same hereby are, overruled and denied; that the Demur-

rers of the Defendants, and each of them, should be, and

the same hereby are, sustained; that plaintiffs shall have

30 days from the date of this order to file an amended

petition; and that if an amended petition is not filed

within 30 days, the case shall stand dismissed with all

costs taxed to Private Truck Council of America, Inc.

IT IS SO ORDERED.

Dated this 17th day of June, 1985.

BY THE CourRT:

s Dale E. Fahrnbruch

Distriet Court Judge

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APPENDIX D

Neb. Rev. Stat. § 60-305-02 (Reissue 1984) provided:

60-305.02. Nonresident owners; trucks and buses;

registration; reciprocity. Trucks, truck-tractors,

semitrailers, or buses, from states other than Ne-

braska shall be required to comply with all the laws

and regulations of any nature imposed on Nebraska

trucks, truck-tractors, semitrailers, trailers, or buses,

and to comply with all the requirements as to pay-

ment of all license fees, permit fees, and fees of

whatever character which owners of trucks, truck-

tractors, semitrailers, trailers, or buses, owned and

operated in Nebraska, are required to pay when oper-

ating in such foreign state, unless the state or states,

in which such trucks, truck-tractors, semitrailers,

trailers, or buses are domiciled, grant reciprocity

comparable to that extended by the laws of Ne-

braska.

Neb. Rev. Stat. § 60-305.03 provided in pertinent part:

60-305.03. Nonresident owners; trucks and buses;

where no reciprocity: fees: all vehicles, reciprocal

agreements authorized; terms and conditions; revi-

sion; absence of agreement; effect. (1) In case a

foreign state or territory is not reciprocal as to li-

cense fees on commercial trucks, truck-tractors, semi-

trailers, trailers, or buses, the owners of such non-

resident vehicles from those states or territories will

be required to pay the same license fees as are

charged residents of this state in such foreign state

or territory. In case no fees are charged in Nebraska

on trucks, truck-tractors, semitrailers, trailers, or

buses, other than license fees, and the reciprocity law

of any other foreign state or territory does not act

to exempt Nebraska trucks, truck-tractors, semi-

trailers, trailers or buses operating in that state

111

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from payment of all fees whatsoever, the owners of

such foreign trucks, truck-tractors, semitrailers, or

buses shall be required to pay a fee in an amount

equal to the fee of whatever character, other than

license fee, is charged by such other state to foreign

trucks, truck-tractors, semitrailers, trailers, or buses:

Provided, that the owners of all foreign trucks,

truck-tractors, semitrailers, trailers, or buses, doing

intrastate hauling in this state, shall be required to

pay the same registration fees as those required to

be paid by residents of this state, unless such vehicles

are registered as a part of a fleet in »nterstate com-

merce, as provided in section 60-305.09. In no case

shall the fee charged to an owner of a foreign motor

vehicle exceed the total fees required to be paid on

like vehicles by residents of the state. The Depart-

ment of Roads shall act as an agent for the Depart-

ment of Motor Vehicles in collecting such fees and

shall remit all such fees collected to the State Treas-

urer, who shall place such money in the Highway

Cash Fund.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.