M. CHRISTINA ARMIJO, District Judge.
This matter is before the Court upon Plaintiffs' Motion for a Preliminary Injunction. [Doc. 2] The Court has considered the written submissions of the parties, the evidence presented at the hearing on this motion, the oral arguments and representations of counsel, and the Court's own research and analysis of the law, and is otherwise fully advised. This Memorandum Opinion and Order incorporates and supplements the findings and rulings announced by Court on Thursday, March 22, 2012, at the hearing on Plaintiffs' motion.
Plaintiffs are various individuals and business entities engaged in the business of outfitting and guiding who seek to do business in New Mexico. Defendant is the Director of the New Mexico Department of Game and Fish ("the Department"). Plaintiffs challenge the following statute:
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NMSA 1978, § 17-3-16.
The prior version of § 17-3-16 also included a quota of licenses set aside for hunters guided by New Mexico outfitters:
However, prior law did not impose the requirements set out in subsection H. Thus, a nonresident could become a registered New Mexico outfitter and qualify for the percentage of draws set aside for guided hunts simply by satisfying the same requirements demanded of a New Mexico resident seeking to become a registered outfitter. NMSA 1978, § 17-2A-3. According to the Plaintiffs, the additional requirements imposed on nonresident outfitters by subsection H, and more particularly by paragraphs 3-6 of subsection H, have the practical effect of categorically excluding nonresident outfitters from participating in the ten percent of guided hunts set aside by the new version of subsection B(1)(a).
Plaintiffs argue that subsection H violates their rights under the dormant Commerce Clause
Before proceeding to the merits of Plaintiff's motion, the Court must first satisfy itself that at least one Plaintiff has Article III standing to assert each of Plaintiffs' claims. Utah Assn. of Counties v. Bush, 455 F.3d 1094, 1098-99 (10th Cir. 2006) (discussing constitutional necessity of standing analysis); American Civil Liberties Union of New Mexico v. Santillanes, 546 F.3d 1313, 1319 (10th Cir. 2008) (citing Crawford v. Marion County Election Bd., 472 F.3d 949, 951 (7th Cir. 2007) for proposition that where only injunctive relief is sought, only one plaintiff must demonstrate standing); Bronson v. Swensen, 500 F.3d 1099, 1106 (10th Cir. 2007) (observing that plaintiffs must have standing to seek "each form of relief in each claim"). To satisfy the requirement of standing "a plaintiff must establish three elements: an injury-in-fact, causation, and redressability." Bronson, 500 F.3d at 1106.
Clearly, imminent economic injury may suffice to establish injury-in-fact for standing purposes. Sac and Fox Nation of Missouri v. Pierce, 213 F.3d 566, 573 (10th Cir. 2000). The inability to pursue a common calling as the result of state action can constitute the requisite injury-in-fact for purposes of either the dormant Commerce Clause, Conservation Force, Inc. v. Manning, 301 F.3d 985 (9th Cir. 2002), or the Privileges and Immunities Clause, McBurney v. Cuccinelli, II, 616 F.3d 393, 404 (4th Cir. 2010). The denial of a nonresident's right to do business on the substantially equal terms with residents can constitute an injury-in-fact for purposes of standing. Council of Ins. Agents and Brokers v. Molasky-Arman, 522 F.3d 925, 932-33 (9th Cir. 2008) (upholding standing to assert claim under Privileges and Immunities Clause); see also Schutz v. Thorne, 415 F.3d 1128 (10th Cir. 2005) (upholding standing to assert claim under Equal Protection Clause).
The Court finds that testimony of Tom McReynolds establishes that his company, Black Mountain Outfitters, Inc., has suffered injury-in-fact, i.e. economic loss, as the result of the inability to compete with resident outfitters for clients interested in subsection B(1)(a) draw hunts. The testimony of Jody Tapia, d/b/a/Bucks-N-Bulls Outfitters, establishes that he has suffered an injury-in-fact, i.e. economic loss, as the result of the inability to compete with resident outfitters for clients interested in subsection B(1)(a) draw hunts. Alternately, the Court finds that Plaintiffs have suffered an injury-in-fact by being unlawfully discriminated against on the basis of nonresidence.
The Court further finds based upon the testimony Tom McReynolds and Jody Tapia, that Black Mountain Outfitters, Inc., and Jody Tapia are otherwise qualified to engage in the business of outfitting in New Mexico, have had willing and able clients in the past, and would have had a reasonable expectation of having willing and able clients for 2012 but for the enactment of subsection H, ¶¶ (3) through (6). The Court finds that the enactment of subsection H, ¶¶ (3) through (6), is the cause of Plaintiffs' injury-in-fact.
Lastly, the Court finds that the injury to Plaintiffs is redressable by an injunction restraining Defendant from applying subsection H, ¶¶ (3) through (6), to Plaintiffs.
Plaintiffs have satisfied the requirements of Article III standing.
Counsel for Plaintiff conceded at the hearing on Plaintiffs' motion that Plaintiffs are requesting a mandatory injunction. The standards governing a mandatory preliminary injunction are as follows:
Att'y Gen. of the State of Okla. v. Tyson Foods, Inc., 565 F.3d 769, 776 (10th Cir.2009) (citations omitted).
Defendant argues that relief under the dormant Commerce Clause is barred by the Reaffirmation of State Regulation of Resident and Nonresident Hunting and Fishing Act, P.L. 109-52, § 6063 (the "2005 Act"). The 2005 Act states:
The 2005 Act was enacted in response to the Ninth Circuit Court of Appeals' opinion in Conservation Force v. Manning, 301 F.3d 985 (9th Cir. 2002), a case involving a dormant Commerce Clause challenge to an Arizona statute that reserved a percentage of elk hunting permits for Arizona residents. Minnesota ex rel. Hatch v. Hoeven, 456 F.3d 826, 833 (8th Cir. 2006). Manning held that the resident permit quota at issue discriminated against interstate commerce and therefore was subject to strict scrutiny under the dormant Commerce Clause. In Schutz, our Court of Appeals applied the 2005 Act in finding that a dormant commerce clause challenge to Wyoming's hunting license fee statute, hunting license quota statute, and hunting guide statute were moot as a result of Congress's enactment of the 2005 Act. As the Court of Appeals observed, "[t]he essential element of a successful dormant Commerce Clause claim is congressional inaction, so when Congress does act, the dormancy ends, thus leaving the courts obliged to follow congressional will. Such is the case here." Schutz, 415 F.3d at 1138.
Plaintiffs argue that 2005 Act does not apply in the present context because outfitting is not hunting. The Court is not persuaded by Plaintiffs' argument. Section 17-3-16 is expressly concerned with the issuance of permits for certain hunts. It therefore falls squarely within the policy and the language of the 2005 Act.
Plaintiffs also argue that Congress cannot enact a statute that nullifies the constitution. [Doc. 15 at 9] As noted above, the dormant Commerce Clause is a judicial gloss on the actual Commerce Clause. The Supreme Court has held with respect to the dormant Commerce Clause that "if Congress ordains that the States may freely regulate an aspect of interstate commerce, any action taken by a State within the scope of the congressional authorization is rendered invulnerable to Commerce Clause challenge." West. & S. Life. Ins. Co. v. State Bd. of Equalization of Cal., 451 U.S. 648, 652-53 (1981). Plaintiffs' argument is without merit.
In view of the 2005 Act, which the Court expressly finds applicable to the activities of outfitting and guiding in the context of this case, Plaintiffs have not established a reasonable likelihood of success on their dormant Commerce Clause challenge.
Turning to Plaintiffs' challenge under the Privileges and Immunities Clause, the Court begins by noting that Plaintiffs doing business as corporations and LLCs are not protected by the Privileges and Immunities Clause, the protections of which are limited to individuals. In re Boggs-Rice Co., Inc. v. Athens Stove Works, Inc., 66 F.2d 855, 856 (4th Cir. 1933). Counsel for Plaintiffs conceded as much at the hearing on Plaintiffs' motion.
With respect to non-corporate Plaintiffs, the Court finds a strong likelihood of success on the merits of their Privilege and Immunities challenge to subsection H, ¶¶ (3) through (6).
First, the Court concludes that the occupation of outfitting hunts is a common calling subject to protection under the Privileges and Immunities Clause. The Supreme Court's opinion in Baldwin v. Fish and Game Comm. of Montana, 436 U.S. 371 (1978), is not to the contrary. Baldwin makes it clear that a hunter cannot bring a successful Privileges and Immunities Clause challenge to a statute like §17-3-16. But Plaintiffs clearly are differently situated than the nonresident recreational hunters in Baldwin. Plaintiffs are professional outfitters and guides who make a living outfitting and guiding hunters. The Supreme Court stressed in Baldwin that the non-resident recreational hunters "do not—and cannot-contend that they are deprived of a means of a livelihood. . . ." 436 U.S. at 388. Here, Plaintiffs, non-resident professional outfitters, can and do make the claim that their means of livelihood is impaired.
Second, subsection H, ¶¶ (3) through (6), denies non-resident outfitters the opportunity to do business on substantially equal terms with New Mexico resident outfitters with respect to subsection B(1)(a) draw hunts. The Court finds the requirements imposed by paragraphs (3) through (6) to be thinly-veiled "proxies" for residency.
Third, Defendant failed to demonstrate a legitimate reason justifying the complete exclusion of non-resident outfitters from participation in subsection B(1)(a) draw hunts. A law that burdens one person over another on the basis of state citizenship must be justified by a substantial reason. C.S. McCrossan Construction, Inc. v. Rahn, 96 F.Supp.2d 1238, 1248 (D.N.M. 2000) ("Finding a burden on a protected privilege does not end the inquiry. A statute injuring a person's rights on the basis of state citizenship will be upheld is there is s substantial reason for the dissimilar treatment, bearing a substantial or close relationship to the state's aim.") At the hearing on Plaintiffs' motion, Patrick Block, the Department's assistant director, testified that subsection H was included to lessen the economic harm to local outfitters from the reduction in the quota for outfitted hunts and thereby quell opposition from the local outfitting industry to the 2011 amendments to § 17-3-16. The preferring of the economic interests of resident outfitters by denying nonresident outfitters the right to compete on equal terms with residents is precisely the type of discrimination based on State citizenship that the Privileges and Immunities Clauses was designed to remedy. See Hicklin v. Orbeck, 437 U.S. 518, 525-26 (1978). The Privileges and Immunities Clause would be rendered toothless if a State could rely on the rationale of eliminating competition with residents to justify excluding nonresidents from pursuing a common calling within that State. Stifling competition from nonresidents engaging in a common calling is a not a substantial reason. Supreme Court of New Hampshire v. Piper, 470 U.S. 274, 285 n.18 (1985).
Defendant argues that the Court should apply the 2005 Act to foreclose Plaintiffs' Privileges and Immunities Clause challenge. As noted above, the language of the 2005 Act is broad enough to reach outfitting. However, the 2005 Act refers to the Commerce Clause, not the Privileges and Immunities Clause. Relying on the reasoning of the First Circuit Court of Appeals in Silver v. Garcia, 760 F.2d 33, 36-38 (1st Cir. 1985) (rejecting argument that by enacting McCarran-Ferguson Act, Congress withdrew protections afforded by the Privileges and Immunities Clause; observing that "even if it intends to do so, Congress cannot legislate away protections provided by the Constitution"), the Court concludes that Defendant's argument that Congress rendered the Privileges and Immunities Clause inapplicable to State regulation of hunting and outfitting is without merit.
The Court finds that non-corporate Plaintiffs will be irreparably harmed by enforcement of subsection H, ¶¶ (3) through (6), as these Plaintiffs will be precluded from participating in subsection B(1)(a) draw hunts for the 2012-2013 hunting season. Alternately, non-corporate Plaintiff s will be irreparably harmed by enforcement of subsection H, ¶¶ (3) through (6), as they will be subject to ongoing unlawful discrimination on the basis of nonresidency. The Court finds that Defendant will suffer some expense and inconvenience from a preliminary injunction restraining Defendant from enforcing subsection H, ¶¶ (3) through (6), against non-corporate Plaintiffs. That harm can be minimized by careful tailoring of the injunction. To that end, the Court will limit the injunction to the following temporary relief: that Defendant direct the Game & Fish Department's computer personnel to code the Guide ID numbers of Plaintiffs doing business as individuals or unincorporated sole proprietorships to indicate that these Plaintiffs qualify as New Mexico registered outfitters for purposes of the upcoming 2012 computerized draw.
Lastly, although the Court believes that a sweeping preliminary injunction would be adverse to the public interest by disrupting the forthcoming 2012 hunting season, the Court has ordered extremely narrow injunctive relief. While the public has an interest in seeing their will as expressed through their duly elected representatives carried out, "the public has a more profound and long-term interest in upholding an individual's constitutional rights." Awad, 2012 WL 50636 *15 (quotation marks omitted). The Court finds that a preliminary injunction limited as noted above is not adverse to the public interest.
The finds that at least one Plaintiff has Article III standing to assert each of Plaintiffs' claims. The Court, applying the heightened standard applicable to mandatory injunctions, finds that Plaintiffs have satisfied each of the four requirements for obtaining a preliminary injunction.
