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Status: In response to PLF's lawsuit, the state of Oregon repealed the law on June 24, 2009.  The legislature passed a bill removing the anti-competitive aspects of the movers' licensing law and the governor signed the bill into law on June 25, 2009.

Summary:
The legal issue presented in this case is whether Oregon’s Motor Carrier statute, ORS 825.110, is unconstitutional under the Due Process, Equal Protection, and Privileges or Immunities Clauses of the Fourteenth Amendment, and 42 U.S.C § 1983, because it subjects certificate applicants to unreasonably anticompetitive and protectionist procedures in order to operate as a moving company in the State.

 

PLF attorneys represent Adam Sweet and his brother, owners of a small moving company in Portland, Oregon.    They provide a range of moving services to both residential and commercial clients, including furniture deliveries, packing and loading, and full service moving with trucks.  They have been in business for two years; they own one truck and lease two trucks “on demand.”  They have two full-time employees, and four who are part-time with three who are on-call.

Sweet wishes to enter into the tightly regulated moving services market in the Portland region.  But Oregon’s certification statute requires that any person wanting to operate a moving company must obtain a certificate.  Any time a person applies for a certificate, other existing companies are notified of the application, and are given an opportunity to protest the application.  Members of the general public are not given any statutory power to protest an application; only existing businesses are.

 

Upon receipt of a protest, the Oregon Department of Transportation  must hold a hearing where the applicant is required to demonstrate a “public convenience and necessity “for his or her services in the motor carrier industry.  Sweet’s competitors reported him to the Department of Transportation, which fined him $2,100 and towed his moving truck for failure to be certified under ORS 825.110.  His competitors also have threatened him and harassed him through prank phone calls.  Sweet recently had to lay off one of his full-time employees because he was forced to cease most of his operations.

Because direct competitors are given preferential treatment over members of the general public who may not protest these applications, the public safety rationale usually advanced in support of licensing restrictions is unusually weak.  When there are such protests, as surely there will be in Sweet’s case, the “public needs” requirement effectively bars small up-and-coming companies that wish to enter into the moving services market.  This statute is anticompetitive and protectionist on its face and as applied, and unreasonably burdens an individual’s economic liberties under the Fourteenth Amendment.