HUG, Senior Circuit Judge:
This case concerns the constitutionality of certain California statutes and regulations. These statutes and regulations prohibit licensed opticians
Plaintiffs filed a complaint alleging that California's Business & Professions Code sections 655, 2556 and 3103, and two companion regulations, 16 Cal.Code of Regs, Title 16 sections 1399.251 and 1514 (collectively "challenged laws") violate the dormant Commerce Clause. Plaintiffs challenge these laws to the extent they prohibit opticians and optical companies from offering prescription eyewear at the same location in which eye examinations are provided and from advertising that eyewear and eye examinations are available in the same location. Section 655 prohibits opticians and optical companies from having "any membership, proprietary interest, co-ownership, landlord-tenant relationship, or any profit-sharing arrangement in any form, directly or indirectly" with ophthalmologists or optometrists.
Plaintiffs challenged these California laws primarily because optometrists and ophthalmologists may set up a practice where patients may receive both eye examinations and prescription eyewear, but opticians may offer only the sale of eyewear, not eye examinations, and therefore are unable to offer the convenience of "one-stop shopping" in California. The restrictions on one-stop shopping apply to all opticians and optical companies when they sell eyewear in California, regardless of whether their stores are entirely owned by California entities or are owned by companies incorporated outside of California.
Plaintiffs moved for summary judgment, and the State opposed the motion. The district court granted Plaintiffs' motion for summary judgment on the grounds that the challenged laws discriminate against interstate commerce and that the State failed to provide sufficient evidence that there are no other means to address its legitimate interest in protecting public health. Nat'l Ass'n of Optometrists & Opticians v. Lockyer, 463 F.Supp.2d 1116 (E.D.Cal.2006). The State appealed.
We reversed, holding that the challenged laws were not discriminatory on their face, in their purpose, or in their effect.
On remand, the parties filed cross-motions for summary judgment. The district court denied Plaintiffs' motion for summary judgment and granted the State's motion for summary judgment. Nat'l Ass'n of Optometrists & Opticians v. Brown, 709 F.Supp.2d 968 (E.D.Cal.2010). The court effectively concluded that, based on the facts and the law, there were no genuine issues of material fact. Plaintiffs argued that the challenged laws impermissibly burdened interstate commerce because: 1) the challenged laws preclude an interstate company from offering one-stop shopping, which is the dominant form of eyewear retailing; and 2) interstate firms would incur a great financial loss as a result of the challenged laws. Id. at 974-78. The district court concluded that it need not consider the evidence supporting these theories because both theories failed as a matter of law. Id. In reaching this conclusion, the court reasoned that, because there was no cognizable burden on interstate commerce, it need not attempt to balance the "non-burden" against the putative local interests under the test derived from Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970). Id. at 975. Plaintiffs timely appealed, and that appeal is now before us.
We review a district court's grant of summary judgment de novo. Far Out Prods., Inc. v. Oskar, 247 F.3d 986, 992 (9th Cir.2001). Therefore, our review is governed by the same standard used by the district court under Federal Rule of Civil Procedure 56(a). Id. Rule 56(a) provides that a court "shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The substantive law determines which facts are material; only disputes over facts that might affect the outcome of the suit under the governing law properly preclude the entry of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). We may affirm a grant of summary judgment on any ground supported by the record. Video Software Dealers Ass'n v. Schwarzenegger, 556 F.3d 950, 956 (9th Cir.2009).
An understanding of Pike and of the purpose and scope of the dormant Commerce Clause informs our determination of whether, as a matter of law, Plaintiffs have provided sufficient evidence of a violation of the dormant Commerce Clause. "Although the Commerce Clause is by its text an affirmative grant of power to Congress to regulate interstate and foreign commerce, the Clause has long been recognized as a self-executing limitation on the power of the States to enact laws imposing substantial burdens on such commerce." South-Central Timber Dev., Inc. v. Wunnicke, 467 U.S. 82, 87, 104 S.Ct. 2237, 81 L.Ed.2d 71 (1984); see also Oregon Waste Sys., Inc. v. Dep't of Envtl. Quality of State of Or., 511 U.S. 93, 98, 114 S.Ct. 1345, 128 L.Ed.2d 13 (1994) ("Though phrased as a grant of regulatory power to Congress, the Clause has long been understood to have a `negative' aspect that denies the States the power unjustifiably to discriminate against or burden the interstate flow of articles of commerce."). This limitation on state power has come to be known as the dormant Commerce Clause. See Dep't of Revenue v. Davis, 553 U.S. 328,
Modern dormant Commerce Clause jurisprudence primarily "is driven by concern about economic protectionism — that is, regulatory measures designed to benefit in-state economic interests by burdening out-of-state competitors. Id. at 337-38, 128 S.Ct. 1801 (internal quotation marks and citations" omitted). "The principal objects of dormant Commerce Clause scrutiny are statutes that discriminate against interstate commerce." CTS Corp. v. Dynamics Corp. of Am., 481 U.S. 69, 87, 107 S.Ct. 1637, 95 L.Ed.2d 67 (1987). "The central rationale for the rule against discrimination is to prohibit state or municipal laws whose object is local economic protectionism," because these are the "laws that would excite those jealousies and retaliatory measures the Constitution was designed to prevent." C & A Carbone, Inc. v. Town of Clarkstown, 511 U.S. 383, 390, 114 S.Ct. 1677, 128 L.Ed.2d 399 (1994). Thus, a corollary concern of the dormant Commerce Clause is that "this Nation is a common market in which state lines cannot be made barriers to the free flow of both raw materials and finished goods." Hughes v. Alexandria Scrap Corp., 426 U.S. 794, 803, 96 S.Ct. 2488, 49 L.Ed.2d 220 (1976).
Given the purposes of the dormant Commerce Clause, it is not surprising that a state regulation does not become vulnerable to invalidation under the dormant Commerce Clause merely because it affects interstate commerce. See S. Pac. Co. v. State of Ariz., 325 U.S. 761, 767, 65 S.Ct. 1515, 89 L.Ed. 1915 (1945). A critical requirement for proving a violation of the dormant Commerce Clause is that there must be a substantial burden on interstate commerce. See South-Central Timber Dev., 467 U.S. at 87, 104 S.Ct. 2237. Most regulations that run afoul of the dormant Commerce Clause do so because of discrimination, but in a small number of dormant Commerce Clause cases courts also have invalidated statutes that imposed other significant burdens on interstate commerce. Gen. Motors Corp. v. Tracy, 519 U.S. 278, 298 n. 12, 117 S.Ct. 811, 136 L.Ed.2d 761 (1997). These other significant burdens on interstate commerce generally result from inconsistent regulation of activities that are inherently national or require a uniform system of regulation. Id.; CTS Corp., 481 U.S. at 88, 107 S.Ct. 1637; see also Exxon Corp. v. Governor of Md., 437 U.S. 117, 128, 98 S.Ct. 2207, 57 L.Ed.2d 91 (1978) (recognizing that, on rare occasions, the Supreme Court has held that the Commerce Clause precludes state regulation in a particular field because "a lack of national uniformity would impede the flow of interstate goods"). A classic example of this type of regulation is one that imposes significant burdens on interstate transportation. See Tracy, 519 U.S. at 298 n. 12, 117 S.Ct. 811; CTS Corp., 481 U.S. at 88, 107 S.Ct. 1637.
Although dormant Commerce Clause jurisprudence protects against burdens on interstate commerce, it also respects federalism by protecting local autonomy. Davis, 553 U.S. at 338, 128 S.Ct. 1801. Thus, the Supreme Court has recognized that "under our constitutional scheme the States retain broad power to legislate protection for their citizens in matters of local concern such as public health" and has held that "not every exercise of local power is invalid merely because it affects in some way the flow of commerce between the States." Great Atl. & Pac. Tea Co. v. Cottrell, 424 U.S. 366, 371, 96 S.Ct. 923, 47 L.Ed.2d 55 (1976) (internal quotations and citations omitted); see also Huron Portland Cement Co. v. City of Detroit, 362 U.S. 440, 443-44, 80 S.Ct. 813, 4 L.Ed.2d 852 (1960) (recognizing that the Constitution "never intended to cut the States off from legislating on all subjects relating to the health, life, and safety of their citizens,
In a long line of dormant Commerce Clause cases, the Supreme Court has sought to reconcile these competing interests of local autonomy and burdens on interstate commerce. In one of those cases, Pike v. Bruce Church, Inc., the Supreme Court set forth the following summary of dormant Commerce Clause law, stating:
Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970) (citation omitted).
Unfortunately, the Pike test has not turned out to be easy to apply. As the Supreme Court has acknowledged, there is "no clear line" in Supreme Court cases between cases involving discrimination and cases subject to Pike's "clearly excessive" burden test. See Tracy, 519 U.S. at 298 n. 12, 117 S.Ct. 811. Justice Scalia has candidly observed that "once one gets beyond facial discrimination our negative-Commerce-Clause jurisprudence becomes (and long has been) a quagmire." W. Lynn Creamery, Inc. v. Healy, 512 U.S. 186, 210, 114 S.Ct. 2205, 129 L.Ed.2d 157 (1994) (Scalia, J., concurring) (internal quotation marks omitted).
Much of the confusion stems from the fact that Pike does not define the term "even-handedly" and combines the test for discriminatory laws with the test for non-discriminatory laws. The cases therefore are not clear or consistent in terms of when a regulation is considered discriminatory and virtually per se invalid and when and how a regulation is subjected to Pike's "clearly excessive" burden test.
In the instant case, we previously held that the challenged laws are not discriminatory on their face, in their purpose, or in their effect. See Nat'l Ass'n of Optometrists, 567 F.3d at 524-28. Nevertheless, because it is possible for nondiscriminatory regulations to place a significant burden on interstate commerce and thereby violate the dormant Commerce Clause, we remanded to the district court for a determination of whether the challenged laws, though non-discriminatory, nevertheless violate the dormant Commerce Clause. Id. at 528. The threshold issue in this appeal is whether Plaintiffs have produced sufficient evidence that the challenged laws, though non-discriminatory, impose a significant burden on interstate commerce. As discussed below, we hold that Plaintiffs have not produced such evidence.
On remand, Plaintiffs argued that, under Pike, the challenged laws impermissibly burdened interstate commerce. Nat'l Ass'n of Optometrists & Opticians v. Brown, 709 F.Supp.2d 968, 974-78 (E.D.Cal.2010). The district court, relying in large part on Exxon Corp. v. Governor of Md., 437 U.S. 117, 98 S.Ct. 2207, 57 L.Ed.2d 91 (1978), rejected those arguments. Id. On appeal, Plaintiffs contend that the district court misinterpreted Exxon, and they argue that the challenged laws impose a significant burden on interstate commerce because the restrictions on one-stop-shopping result in a transfer of market share and income from "out-of-state"
In Exxon, the Supreme Court considered a Maryland law that prohibited petroleum producers and refiners from owning retail service stations in Maryland. Exxon, 437 U.S. 117, 98 S.Ct. 2207. Because no petroleum products were produced or refined in Maryland, all the producers and refiners affected by the regulation were out-of-state companies. Id. at 123, 98 S.Ct. 2207.
The reasoning of Exxon applies to the instant case. Plaintiffs want opticians to be able to offer one-stop shopping. The challenged laws regulating one-stop shopping are generally applicable regulations of a method of operating in a retail market. Under the reasoning of Exxon, the dormant Commerce Clause does not protect this method of operation, nor guarantee Plaintiffs their preferred method of operation, in the eyewear retail market.
Plaintiffs argue that Exxon does not preclude relief here because the challenged laws have the effect of shifting market share and profits from "out-of-state" entities to "in-state" ones.
Id. at 127, 98 S.Ct. 2207 (emphasis added).
Plaintiffs make much of the fact that the Exxon Court wrote of a shift from one "interstate supplier to another," and they argue that this explains why the Supreme Court upheld the statute. Plaintiffs distinguish their own case on the grounds that here the challenged laws will cause a shift in market share from eyewear sellers owned by companies that are incorporated outside of California to entirely in-state eyewear sellers. It is true that, in Exxon, all of the shift in supply necessarily would
But the Exxon Court's own analysis shows that the fact that the change in supply would be from one interstate petroleum supplier to another interstate petroleum supplier had no bearing on the Court's decision, especially once the Court determined that the statute was not discriminatory.
Plaintiffs next argue that Minnesota v. Clover Leaf Creamery, Co., 449 U.S. 456, 101 S.Ct. 715, 66 L.Ed.2d 659 (1981), supports their claim that there is a significant burden on interstate commerce when nondiscriminatory regulations result in income shifting from out-of-state corporations to in-state businesses.
After rejecting the argument that the statute was discriminatory,
Although the Supreme Court found the burden to be relatively minor and upheld the statute, Plaintiffs argue that this part of Clover Leaf shows that a shift in income from "out-of-state" to "in-state" businesses is a burden on interstate commerce that must be weighed against the benefits of a statute causing such a shift in income. In Clover Leaf, however, the Court made no mention of "income" and instead discussed manufacturing and exporting materials or goods into another state. The Court used terms such as "Minnesota product," "out-of-state pulpwood producers," "Minnesota pulpwood industry," and "out-of-state plastics industry," and it addressed the issue of whether there would be a change in the importation into Minnesota of materials and goods produced outside of Minnesota. Id. at 472-73, 101 S.Ct. 715 (emphasis added). Thus, the Court's determination of whether there was a burden on interstate commerce turned on a change in the flow of goods into the state, not on profits.
We conclude that Supreme Court precedent
In light of this law, it is apparent that, in the case before us, there is no material issue of fact regarding whether the challenged laws place a significant burden on interstate commerce. Plaintiffs have not produced evidence that the challenged laws interfere with the flow of eyewear into California; any optician, optometrist, or ophthalmologist remains free to import eyewear originating anywhere into California and sell it there. In addition, we are not concerned here with activities that require a uniform system of regulation. Thus, Plaintiffs have failed to raise a material issue of fact concerning whether there is a significant burden on interstate commerce.
Relying on Pike, Plaintiffs argue that, in determining whether a regulation violates the dormant Commerce Clause, courts are required to examine the actual benefits of nondiscriminatory regulations. However, Pike discusses whether the burden on interstate commerce is "clearly excessive in relation to the putative local benefits." See Pike, 397 U.S. at 142, 90 S.Ct. 844 (emphasis added). It does not mention actual benefits as part of the test for determining when a regulation violates the dormant Commerce Clause.
Even if Pike's "clearly excessive" burden test were concerned with weighing actual benefits rather than "putative benefits," we need not examine the benefits of the challenged laws because, as discussed above, the challenged laws do not impose a significant burden on interstate commerce. If a regulation merely has an effect on interstate commerce, but does not impose a significant burden on interstate commerce, it follows that there cannot be a burden on interstate commerce that is "clearly excessive in relation to the putative local benefits" under Pike. Accordingly, where, as here, there is no discrimination and there is no significant burden on interstate commerce, we need not examine the actual or putative benefits of the challenged statutes. This is the implicit lesson of Exxon. Once the Exxon Court determined that there was no discrimination and no significant burden on interstate commerce, it ended its dormant Commerce Clause analysis without assessing the value of the statute's purported benefits or actual benefits. See Exxon Corp. v. Governor of Md., 437 U.S. 117, 125-29, 98 S.Ct. 2207, 57 L.Ed.2d 91 (1978).
Plaintiffs ask us to determine whether the benefits of the challenged laws are illusory. Occasionally, when determining whether a non-discriminatory health and safety regulation violates the dormant Commerce Clause, courts will
Because the challenged laws are not discriminatory and do not impose a significant burden on interstate commerce, it would be inappropriate for us to determine the constitutionality of the challenged laws based on our assessment of the benefits of those laws and the State's wisdom in adopting them. See CTS Corp., 481 U.S. at 92, 107 S.Ct. 1637 (noting that the Supreme Court is not inclined to second-guess the empirical judgments of lawmakers concerning the utility of legislation); Alaska Airlines, Inc. v. City of Long Beach, 951 F.2d 977, 983, 984 (9th Cir. 1991) (holding that it was inappropriate for the district court to make a quasi-legislative judgment by weighing community concerns about noise against the need for safe and efficient national transportation system); cf. Davis, 553 U.S. at 355, 128 S.Ct. 1801 (recognizing that the judicial process is generally unsuited to answering many of the cost-benefit questions raised in dormant Commerce Clause challenges).
Accordingly, we express no opinion regarding the value of the putative benefits or the actual benefits of the challenged laws.
Plaintiffs contend that the district court erred by failing to determine whether there is a genuine issue of material fact concerning whether the purposes of the challenged laws could be served as well with less restrictive alternatives. As an initial matter, it is not clear what role possible alternative regulations play when, as here, the challenged laws are not discriminatory. In most dormant Commerce Clause cases, it is not the role of the courts to determine the best legislative solution to a problem. See S. Carolina State Highway
Even assuming that, in the wake of Davis, overwhelming and conclusive evidence of equally effective alternative regulations is relevant to the analysis of nondiscriminatory regulations, in order for us to invalidate a statute based on the availability of less burdensome alternatives, the statute would have to impose a significant burden on interstate commerce. See Pac. Nw. Venison Prods. v. Smitch, 20 F.3d 1008, 1016 (9th Cir.1994). Because the challenged laws do not impose a significant burden on interstate commerce, it would be inappropriate for us to set them aside based on a conclusion that the State's purposes could be served as well with alternative laws. We therefore will not consider any evidence regarding alternative means for the State to achieve its goals.
For the foregoing reasons, the district court's order granting the State's motion for summary judgment and denying Plaintiffs' motion for summary judgment is AFFIRMED.