New Bedford Suit Against SSA Brings Sharp Queries from Judge

By JULIA WELLS

BOSTON - In a courtroom grilling that went on for nearly three straight hours, a federal judge put the lead attorney for the city of New Bedford on a hot spot this week, prodding him to produce a set of plausible legal arguments that show why he should not dismiss the Whaling City's case against the Steamship Authority.

U.S. District Court Judge Douglas P. Woodlock also invited the state attorney general to amplify the state's position in the case, specifically on the issue of jurisdiction and whether the city has standing to bring a lawsuit against the state-chartered boat line in federal court.

"I am faced with an intramural squabble. What we have is a spat between two state entities - the Steamship Authority and the city of New Bedford. It seems to me that the great and general court could decide that this should not be resolved in federal court. This is an in-house issue," declared Judge Woodlock.

The remark came during a hearing in federal court in Boston on Wednesday afternoon.

Two years ago New Bedford filed a massive lawsuit against the public boat line in U.S. District Court, claiming among other things that the SSA violates interstate commerce laws by restricting ferry service between the mainland and the two Islands.

Held in a third-floor courtroom in the grand John Joseph Moakley U. S. Courthouse on the fan pier in downtown Boston, the hearing was intended for arguments on a summary judgment motion filed by the boat line attorneys.

But at the outset Judge Woodlock took a left turn, deciding instead to come back to an issue that was raised by attorneys for the boat line two years ago when New Bedford first filed suit in federal court.

The issue centers on whether the city has standing to bring the claim against the state-chartered boat line in federal court. Attorneys for the boat line also questioned whether the lawsuit violates state sovereignty because both the SSA and the city are considered subdivisions of the commonwealth.

Federal courts are expected to respect state sovereignty and the decisions of the state legislature, and there is little federal case law in this area.

Nine months ago Judge Woodlock refused to rule on a motion to dismiss by boat line attorneys, deciding instead that the complete record in the case should be developed first. After months of discovery and legal bills that have mounted to nearly $500,000 for the SSA, the record is now complete.

And on Wednesday Judge Woodlock returned to the motion to dismiss.

"I am trying to understand how it is that a state entity gets to say that the state has violated the interstate commerce clause - what is the precise meaning of that? It strikes me as more than passing puzzling here. It's the question of who under state law has the authority to litigate a matter," said the judge, who has a reputation for expounding at length from the bench on complicated issues of law.

The hearing was attended by attorneys on both sides of the case and a handful of spectators. But John Montgomery, a partner at Ropes & Gray who represents the SSA, spent very little time on his feet because Judge Woodlock had his sights trained on Henry Dinger, a partner at Goodwin Procter, who represents New Bedford.

The case has had a number of turns. Early on, Judge Woodlock ordered the city of New Bedford to find a private carrier to submit a license application to the line (the state statute that created the SSA in 1960 gives the boat line the power to license its competitors). The order was intended to force a real-life test of the city's claim that there were numerous private carriers who wanted to run freight service to the Islands, but had somehow been restrained by the SSA.

In the end only one carrier submitted a license application - Seabulk International Inc., the same carrier that the SSA paid to operate a pilot freight program between New Bedford and the Vineyard. The Seabulk application was rejected by the boat line because it was accompanied by a long list of constitutional demands.

This week Judge Woodlock again raised the question about why the challenge to the boat line did not come from Seabulk.

"Mr. Dinger, why should we permit a third party to engage in this kind of litigation? The statute is intended for those who are directly engaged in coastwise trade, not those who are contracting with them. I have difficulty understanding why there should be this kind of hospitality," he said.

"But it does apply when it would be good for the local economy to expand the coastwise trade. . . . The city of New Bedford, we are part of the commercial activity that we claim is being unfairly burdened by the Steamship Authority. We are a participant," argued Mr. Dinger.

"Aren't we all? Isn't the town of Southborough a participant as well?

Isn't the city of Pittsfield? Any municipality close to Woods Hole could under your theory raise this issue," the judge returned.

"What's the public policy of letting two state entities argue over the standing issue - why does the federal court have to open itself up to dissident issues within a state? Seabulk has chosen not to litigate, and now there is a question about whether we can open our gates to squabbling state entities. What is the reason, no constitutional issue should go unlitigated?" the judge added.

"My position is the community has taken that position," Mr. Dinger replied.

"So I'm simply waiting here like a potted palm for intramural disputes to present themselves for my interest?" the judge shot back.

"I am suggesting, where's Seabulk? They are the ones who are right at the core of this," he said.

The judge then turned to Stephanie Lovell, an assistant attorney general who is chief of the government division for Attorney General Thomas Reilly. Judge Woodlock pressed Ms. Lovell for an opinion.

"Is it the position of the commonwealth that I can't adjudicate this dispute?" he said.

"I think the court is quite correct in that the commonwealth has the ability to question corporations in their right to sue," Ms. Lovell began, but the judge interrupted her, pressing further amid a bit of humor: "You can run but you can't hide, Ms. Lovell. Am I supposed to . . . dismiss this case?" he said.

"The commonwealth takes the position that the city of New Bedford is without standing to bring this case in federal court," Ms. Lovell finally said.

Mr. Dinger was on his feet immediately. "I would suggest that the commonwealth is wrong," he said.

But just when it seemed like Judge Woodlock was ready to end the matter of jurisdiction, he took another turn. "I think this is ripe for more argument," he said, and invited Ms. Lovell to submit a brief. A deadline of early August was agreed on, with reply briefs due by mid-August.

Later called on by the judge, Mr. Montgomery said the question of standing goes to the heart of the case. He said the law is clear that the city has no jurisdiction to bring a constitutional claim in state court - and if there is no claim in federal court, then there is no standing, period. "What that says is that this is a political issue for New Bedford, not a legal issue," Mr. Montgomery concluded.