United States District Court for the District of Columbia
March 26, 2004.
GREYHOUND LINES, INC., Plaintiff,
MONROE BUS CORP. and GITTY UNGAR d/b/a/ WASHINGTON DELUXE BUS CO. Defendants
The opinion of the court was delivered by: ROYCE LAMBERTH, District Judge
MEMORANDUM OPINION AND ORDER
Before the Court is the defendants' Motion for Summary Judgment,
requesting judgment in their favor and dismissal of the plaintiff's
complaint pursuant to Fed.R.Civ.P. 56(b).
Upon consideration of the defendants' motion, the applicable law and
the record in this case, the Court finds there are genuine issues of
material fact that are in dispute. Therefore, the Court will deny the
defendants' Motion for Summary Judgment.
On October 15, 2002, the plaintiff, Greyhound Lines, Inc., filed the
instant action against the defendants, Monroe Bus Corp. and Gitty Ungar,
alleging that the defendants conducted unauthorized scheduled,
regular-route motor carrier operations between New York and Washington,
D.C. in violation of 49 U.S.C. § 13901, 14704(a)(2) and 14707(a),
thereby, injuring plaintiff Greyhound by diverting passengers and
revenue. At some point after this suit was instituted, defendant Monroe
Bus Corp. applied for and received registration to conduct a
scheduled, regular-route motor carrier operation pursuant to §
13901. Defendant Ungar has not attempted to procure § 13901
registration, and continues to engage in the allegedly violative
behavior. Therefore, plaintiff Greyhound seeks only compensatory and
punitive damages from defendant Monroe Bus Corp. for the revenue loss that
it suffered during the period in which defendant Monroe Bus Corp.
operated without a § 13901 registration certificate, as well as
attorneys' fees. Plaintiff Greyhound still seeks injunctive relief
against defendant Ungar and compensatory and punitive damages for the
revenue loss it suffered, and continues to suffer, as a result of her
violation of the § 13901 registration requirement, as well as
The defendants moved for summary judgment on the action in its entirety
pursuant to Fed.R.Civ.P. 56(b). Plaintiff Greyhound did not cross-move
for summary judgment.
I. Undisputed Facts
Plaintiff Greyhound is a scheduled, regular-route motor carrier
passenger service in interstate commerce, pursuant to authority granted
by the Federal Motor Carrier Safety Administration of the United States
Department of Transportation ("FMCSA").*fn1 Plaintiff Greyhound is
incorporated in Delaware and conducts business between New York and
Washington, D.C. from a terminal located at 1005 1st Street, NE,
The defendants became involved in the operation of scheduled,
regular-route motor carrier passenger services in interstate commerce on
or about July 1, 2002. Defendant Monroe Bus Corp. did not obtain
registration from the FMCSA pursuant to § 13901 until sometime after
the instant action was filed, and defendant Ungar is still not registered
with the FMCSA pursuant to § 13901. Defendant Monroe Bus Corp. is
incorporated in New York, conducts business in
New York from offices located in Monroe County, New York and Brooklyn,
New York, and is engaged in the operation of a scheduled, regular-route
motor carrier passenger service between New York and Washington, D.C.
Defendant Ungar does business as Washington Be Luxe Bus Co., is a
resident of New York, has a business office located in Brooklyn, New
York, and also engages in the operation of a scheduled, regular-route
motor carrier passenger service between New York and Washington, D.C.
II. Parties' Arguments
Plaintiff Greyhound maintains that on or about July 1, 2002 the
defendants began unlawfully holding themselves out as scheduled,
regular-route motor carrier passenger services between locations in New
York and Washington, B.C. Plaintiff Greyhound maintains that defendant
Ungar began conducting unauthorized scheduled, regular-route motor
carrier operations between New York and Washington, D.C under the name
"Washington Be Luxe Bus Co." In support of this contention, plaintiff
Greyhound notes that defendant Ungar advertised and solicited business
for Washington Be Luxe Bus Co. by printing and distributing flyers,
running ads in New York and Washington, B.C. area newspapers, and setting
up a web page with schedules and toll-free and direct telephone numbers.
Plaintiff Greyhound also points to a Washington Post article, based on an
interview of defendant Ungar, that identifies defendant Ungar as the
owner of Washington Be Luxe Bus Co., and lists phone numbers ascribed to
defendant Ungar and one of her addresses. Plaintiff Greyhound maintains
that Washington Be Luxe Bus Co. transported passengers between New York
and Washington, B.C., and that the passengers usually paid the bus driver
at boarding time. Plaintiff Greyhound also contends that the defendants
engaged in deception in contravention of § 13901 by displaying signs
"Washington De Luxe Bus Co." before departure, but replacing those
signs with ones displaying the name of "Monroe Bus Corp." upon departure.
Defendant Monroe Bus Corp. counters that it merely "leased its buses
with drivers to Sharmash [Bus Corp.] through daily charter arrangements
for part of Sharmash's New York-Washington transportation," and,
therefore, was not required to obtain a § 13901 registration
certificate from the FMCSA in order to lawfully conduct its business.
See Defendants' Motion, p. 15-16. Defendant Monroe Bus Corp. further
maintains that its lease with Sharmash was "for Sharmash common carrier
bus service between Brooklyn, N.Y. and Washington, D.C.," and that a
conspicuous service placard stating that the motor carrier service was
being operated by Sharmash, not Monroe Bus Corp., was displayed under
Sharmash's FMCSA-issued registration certificate. Defendant Monroe Bus
Corp. also notes that it is not the only lessor of Sharmash for this
particular type of service. Moreover, defendant Monroe Bus Corp. maintains
that its later application for and receipt of an FMCSA-issued § 13901
registration certificate was for the purpose of mitigating litigation
expenses in connection with this action, not because it was required to
do so by law.
Defendant Ungar maintains that she has no lease agreement with
Sharmash, and does not hold herself out as the conductor of a scheduled,
regular-route motor carrier passenger service between locations in New
York and Washington, D.C. Rather, defendant Ungar maintains that she is
merely a sales agent for Sharmash, and only handles reservations and
ticket distribution. Defendant Ungar also contends that the Washington De
Luxe Bus Co. brochures clearly indicate that the bus service is operated
by Sharmash under an FMCSA § 13901 registration certificate issued to
Moreover, both defendants, while conceding diversity jurisdiction,
dispute that the amount in controversy exceeds $75, 000, maintaining that
the alleged injury could not meet the $75, 000 threshold requirement
because defendant Monroe Bus Corp.'s single-trip daily Sharmash Brooklyn,
N.Y. Washington, D.C. service is non-competitive and minuscule in
view of plaintiff Greyhound's combined arrangement with Peter Pan Bus
Lines. The defendants also dispute the Court's jurisdiction under
28 U.S.C. § 1332(a)(1) or 1331, and maintain that plaintiff Greyhound
has failed to state a claim upon which relief can be granted and does not
have standing under 49 U.S.C. § 13902(a).
This Court has jurisdiction pursuant to 28 U.S.C. § 1332. The Court
finds that there is diversity of citizenship between plaintiff Greyhound,
a Delaware corporation, and the defendants, a New York corporation and a
New York resident. Relying on the averment made by plaintiff Greyhound
and finding no reason to question said averment, the Court also finds
that the amount in controversy is in excess of $75,000, thereby, meeting
the statutory requirement.
The Court also has jurisdiction pursuant to 28 U.S.C. § 1331.
Section 1331 authorizes jurisdiction in federal courts over actions
"arising under the Constitution, laws, or treaties of the United States."
Therefore, this Court has jurisdiction over the instant matter brought
under 49 U.S.C. § 13901, 14704 and 14707.
I. Procedural Law
Pursuant to Fed.R.Civ.P. 56, summary judgment is appropriate when
the motion papers, affidavits, and other submitted evidence demonstrate
that no genuine issue of material fact exists
and that the moving party is entitled to judgment as a matter of law.
See Fed.R.Civ.P. 56(c); Celotex Corp. V. Catrett, 477 U.S. 317, 322
(1986). Whether a fact is "material" is determined in light of the
applicable substantive law invoked by the action. See Anderson v. Liberty
Lobby Inc., 477 U.S. 242, 248 (1986). In light of the applicable
substantive law, a "genuine issue of material fact" is a fact that is
determinative of a claim or defense, and therefore, affects the outcome
of the case. See Celotex, 477 U.S. at 322; Anderson, 477 U.S. at 248.
Because the Court does not sit a fact-finder, it is precluded from
weighing evidence or finding facts and must draw all inferences and
resolve all doubts in favor of the non-moving party. See Matsushita
Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986). Disposition
by summary judgment is precluded when determination of a genuine issue of
material fact might result in a reasonable jury returning a verdict in
favor of the non-moving party. See Anderson, 477 U.S. at 248; Morgan v.
Federal Home Loan Mortg. Corp., 328 F.3d 647, 651 (D.C. Cir. 2003).
II. Substantive Law
The plaintiff's action invokes the Motor Carrier Act, which regulates
the operation of certain passenger transportation services by mandating
registration, imposing liability for violation of the Act, and creating a
private right of enforcement for those injured by violation of the Act.
Section 13901 of the Act requires motor carrier passenger services to
register with the FMCSA, and mandates that:
A person may provide transportation or service
subject to jurisdiction under subchapter I or III
of chapter 135 or be a broker for transportation
subject to jurisdiction under subchapter I of that
chapter, only if the person is registered under
this chapter to provide the transportation or
See 49 U.S.C. § 13901(a). Section 14704 provides rights and remedies
for persons injured by violation of the Act, and specifically provides
A carrier or broker providing transportation or
service subject to jurisdiction under chapter 135
is liable for damages by a person as a result of
an act or omission of that carrier or broke in
violation of this part.
See id. at § 14704(a)(2). Moreover, § 14707 specifically provides
for a private right to enforce the registration requirement imposed by
§ 13901, and specifically provides that:
If a person provides transportation by motor vehicle
or service in clear violation of section 13901-13904
or 13906, a person injured by the transportation or
service may bring a civil action to enforce any such
section. In a civil action under this subsection,
trial is in the judicial district in which the person
who violated that section operates.
See id. at § 14707(a).
As a threshold matter, the Court finds that pursuant to §
14704(a)(2) plaintiff Greyhound may maintain an action against the
defendants for violation of § 13901, and may seek redress by way of
the private enforcement right provided by § 14707(a). These finding
are in accord with both a plain reading and agency interpretations of the
Act. The Federal Highway Administration, then the agency charged with
administration of the Act, has stated that "[u]nder 49 U.S.C. § 14704,
an injured party may seek both damages and injunctive relief against a
motor carrier in federal court to redress violations of [the Act] . . .
DOT should not allocate its scarce resources to resolving essentially
private disputes, and that the right of private enforcement `will permit
these private disputes to be resolved the way that all other commercial
disputes are resolved by the parties'" See 63 Fed. Reg. 31827,
31828 (June 10, 1998) (internal citation omitted). Agency constructions
are given deference, see Cellware Telephone Service L.P. v. F.C.C.,
30 F.3d 1533,
1537 (D.C. Cir. 1994), and the Court has not been provided with any
valid reason to stray from the relatively clear language of these
provisions or the administrative explications regarding them.
Summary judgment is inappropriate in this case because defendants have
failed to demonstrate that no genuine issues of material fact exist and
that they are entitled to summary judgment as a matter of law. Upon
review of all of the submitted papers and the parties' arguments, the
Court finds that critical questions remain as to whether the defendants
are covered by § 13901 of the Act, and if so, whether they are or
were in violation of § 13901 at varying points. Specifically at
issue: (1) whether defendant Monroe Bus Corp.'s scheduled bus service
between New York and Washington, D.C. was conducted under its charter
authority; and (2) whether defendant Ungar, doing business as Washington
Be Luxe Bus Co., held herself out as a motor carrier of passengers.
Material facts critical to the disposition of these issues are in genuine
dispute, and the fact that a reasonable jury could resolve these issues
and the critical underlying facts in favor of plaintiff Greyhound
precludes a grant of summary judgment for the defendants.
First, whether defendant Monroe Bus Corp. rendered bus service under
its charter authority or rendered scheduled, regular-route common carrier
passenger service is a genuine issue of material fact because the type of
service rendered by defendant Monroe Bus Corp. bears upon whether it was
required to register with the FMCSA at the commencement of its service.
Charter service, for which § 13901 FMCSA registration is not
required, is legally distinct from common carrier service, which does
require § 13901 registration. Charter service contemplates the
transportation of affiliated groups, such as lodges, athletic teams and
travel groups. See
Fordham Bus Corp. Common Carrier Application, 29 M.C.C. 293, 297 (1941),
aff'd Fordham Bus Corp. v. United States, 41 F. Supp. 712 (S.D.N.Y.
1941). Regular common carrier service contemplates unrestricted access to
the general public on a first-come first-serve, even where advanced seat
reservations are available, and no requirement of group membership or
affiliation. See Transport of New Jersey v. Greyhound Lines, Inc.,
463 F. Supp. 1117, 1119(D.D.C. 1979).
Defendant Monroe Bus Corp. holds a FMCSA registration certificate for
nationwide charter and special service and contends that while it
physically operated the buses that provided service between New York and
Washington, D.C., the service itself was provided by Sharmash, which
holds § 13901 registration for common carrier service in compliance
with the Act. Defendant Monroe Bus Corp. maintains that as a mere
lessor, it was not required to comply with § 13901. Plaintiff
Greyhound, however, maintains that during the period that defendant
Monroe Bus Corp. operated without registration it was, indeed, conducting
a common carrier passenger service in its own right, contrary to its
proffers and in violation of the Act. Drawing all inferences in a light
most favorable to plaintiff Greyhound, the Court finds that facts which
bear upon resolution of this matter are in dispute, and reasonably
resolvable in Plaintiff Greyhound's favor.
First, the Washington De Luxe Bus Co. brochure in which the defendants'
services are advertised clearly evinces that they were providing a common
carrier service as understood under the Act and described in the case
law. The brochure states "Walk-Ins Welcome" and "Reservations
Recommended." See Washington De Luxe brochure. The brochure also
advertises that their service is available "whether you are traveling for
business or pleasure," and that a seat may be procured by "pay[ing] cash
to the bus driver." See id. Viewing the evidence
and these statements in the light most favorable to plaintiff Greyhound,
the Court finds that a reasonable jury could find that defendant Monroe
Bus Corp. was not operating under its national charter authority or the
§ 13901 authority held by Sharmash, a finding that would be favorable
to plaintiff Greyhound.
Second, although defendant Monroe Bus Corp. maintains that it is a mere
lessor, it admits that there is no written lease agreement, which appears
to be industry practice. FMCSA regulation 49 C.F.R. § 390.21(e), in
fact, requires written lease agreements and that a copy of the written
agreement travel with the leased vehicle unless there is a placard
showing the name of the lessee on the vehicle. FMCSA regulation
49 C.F.R. § 391.65 requires that motor carriers using the drivers of
another motor carrier maintain driver qualification records for three
years. The existence and maintenance of these records in question as none
have been produced. A reasonable inference to be drawn, and one that a
reasonable jury could make, from the lack of a written lease agreement or
related records is that no lease agreement existed.
Third, FMCSA regulation 49 C.F.R. § 395.8(k) requires that the
motor carrier for which the vehicles are being operated retain driver
duty status logs for at least six months. Here, although defendant Monroe
Bus Corp. maintains that it operated motor vehicles for Sharmash and
under Sharmash's § 13901 authority, both Sharmash's and Monroe Bus
Corp.'s interrogatory responses reveal that Monroe Bus Corp., not
Sharmash, maintained the driver duty status logs. This would indicate,
and a reasonable jury could find, that defendant Monroe Bus Corp. was not
simply physically operating vehicles for Sharmash, but rather operating
the buses for their own unlawful business purposes.
Fourth, FMCSA regulation 49 C.F.R. § 390.21 (a) requires that the
name and MC or
USDOT number of the motor carrier passenger service appear on both sides
of the vehicle. Here, despite its representations that service is
conspicuously placarded "as being operated by Sharmash under its FMCSA
registration certificates," see Answer, para. 2, in an interrogatory
response defendant Monroe Bus Corp. admits that "Monroe's name and
MC/USDOT numbers appear on both sides of its buses at all times." See
Interrogatory No. 2. This fact is corroborated by averments made in the
affidavits of Raymond A. Robinson and Myron H. Watkins, who, upon
investigation, observed that defendant Monroe Bus Corp.'s name was the
only one displayed on the sides of the buses. Given the Court's
inferential duty and the defendants' burden, this dispute alone precludes
the grant of summary judgment in this case.
Next, material facts determinative of whether defendant Ungar holds
herself out as a motor carrier of passengers are also in dispute.
Defendant Ungar maintains that she is a mere agent for Sharmash, and
notes, in support, that the Washington De Luxe Bus Co. brochures that she
issues clearly indicate that the bus service is operated by Sharmash
under Sharmash's § 13901 registration certificate. Despite defendant
Ungar's representations of agency, whether she provided illegal service
under the name Washington De Luxe Bus Co., depends upon whether she held
herself out to the general public as the owner of Washington De Luxe Bus
Co. and as motor carrier of passengers. See Craig Contractor Carrier
Applications, 31 M.C.C. 705, 708-709 (1941); J. Norman Geipe, Inc., Common
Carrier Application, 1 M.C.C. 693, 697 (1937). Plaintiff Greyhound points
to several pieces of evidence that suggest that defendant Ungar does
business as Washington De Luxe Bus Co. and holds herself out as a motor
carrier of passengers.
As previously mentioned defendant Ungar printed and distributed flyers,
ran newspaper ads, gave interviews, and ran a website under the name
Washington De Luxe Bus Co. Defendant
Ungar also concedes that the name "Sharmash Bus Corp." did not appear in
the advertisements, that the telephone numbers listed for Washington De
Luxe Bus Co. either belonged to her or were listed to her address, and
that she paid the telephone bills herself. Again, drawing all inferences
in the light most favorable to the non-moving party, plaintiff
Greyhound, the Court finds that a reasonable jury could interpret this as
evidence that defendant Ungar does hold herself out as a motor carrier of
passengers in violation of § 13901.
For the aforementioned reasons, the Court finds that the defendants are
not entitled to summary judgment, and their motion is, therefore, denied.