For the past three years, Stan Cramer has been fighting to save his parking garage near the Harrisburg International Airport from eminent domain seizure by the airport’s municipal operating authority. The airport wants to eliminate competition with its own parking lots, and when Cramer refused to sell voluntarily, the authority used its powers under Pennsylvania law to take the property by force. Recently, a Pennsylvania judge allowed Cramer’s lawsuit to stop the seizure to proceed to trial.
In a related case, Pennsylvania AG Tom Corbett filed a federal lawsuit last year to stop the airport authority’s seizure on the grounds that it violates federal antitrust law. It’s a strange setup: The Commonwealth of Pennsylvania suing one of its own subdivisions in federal court over the use of power granted by state law. In March, U.S. District Judge Christopher Conner dismissed the AG’s complaint, citing the airport authority’s immunity from federal antitrust lawsuit as a state actor. Conner said the airport’s anti-competitive motives were irrelevant; its actions were clearly authorized by the Pennsylvania legislature.
Corbett appealed the judge’s dismissal to the Third Circuit Court of Appeals. Briefs were filed in October, and a decision on the appeal is expected next year. Meanwhile, new management has taken over at the airport, and they are trying to negotiate a settlement with Cramer.
The use of antitrust law to stop eminent domain abuse may sound appealing, but Corbett’s lawsuit raises a few issues. First, the antitrust argument focuses on the customers of a business rather than the rights of the business owner. If the authority seized a private business that was not in direct competition with the airport, the AG presumably wouldn’t have challenged the use of eminent domain. That hardly bolsters the property rights argument used by most eminent domain opponents.
Second, Corbett is using the federal courts to do undermine the state courts—which was already hearing Cramer’s petition to stop the seizure—as well as the state legislature. Corbett’s lawsuit looks more like a power grab for his office than a credible attempt to curb eminent domain abuse, which should be done by the legislature.
Third, as Judge Conner’s decision noted, eminent domain inherently contradicts antitrust principles. There’s no question that the airport is trying to eliminate competition and “monopolize” the market for airport parking, but eminent domain has never been about promoting market competition. The conundrum is that eminent domain is said to be in the “public interest,” but that’s also the rationale for antitrust. Which public interest must prevail here?
This actually raises an interesting question. Could the DOJ or FTC take action under the antitrust laws to prevent a state or local government’s eminent domain action if it is deemed anti-competitive? The FTC has issued complaints against state licensing agencies over regulations deemed injurious to interstate competition. (One such case, against the South Carolina State Board of Dentistry, is currently before the Supreme Court.) It’s not much of a stretch to go after state eminent domain policies.
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This case is another reminder of how government forgets who it’s supposed to exist for: the citizens, not itself.
This is a fascinating case. I can’t help but smile at the fact that the official airport carpark is underutilized and that the private citizen has been attracting customers with his cheaper rates. It’s not as if the airport carpark is constantly over capacity and desperately needs more space to accommodate the number of travellers (which we’ve seen at other airports). It will be interesting to see how this plays out.