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BeavEx, Inc. v. Costello

Topic(s): Preemption of Consumer Remedies

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In this case, delivery drivers for BeavEx, Inc., a courier company, alleged that the company unlawfully classified them as independent contractors when they should have been classified as employees, resulting in illegal deductions being taken from their wages. BeavEx argued that the preemption provision in the Federal Aviation Administration Authorization Act (FAAAA), which provides that states may not enact or enforce laws “related to a price, route, or service of any motor carrier … with respect to the transportation of property,” preempts the relevant state law provision requiring workers to be classified as employees for certain purposes unless certain conditions are met. The district court held that the provision is not preempted, explaining that BeavEx’s argument was “tantamount to arguing immunity from all state economic regulation.” On interlocutory appeal to the Seventh Circuit, we filed an amicus brief in support of the drivers, explaining that the FAAAA does not preempt the state labor law. On January 19, 2016, the Seventh Circuit held that the state law provision is not related to the price, route, or service of a motor carrier and is therefore not preempted by the FAAAA.

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