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Maritime Update: Jones Act’s Cabotage Provisions Upheld

Novak v. United States, July 30, 2015 — F.3d —- 2015 WL 4568442

The 9th Circuit affirmed the district court’s dismissal of an action challenging the constitutionality of the Jones Act’s cabotage provisions, which prohibit foreign competition in the domestic shipping market.

Plaintiffs alleged that the Jones Act’s provisions impaired interstate trade between Hawaii and the rest of the United States to such an extent that they violated the Constitution. Plaintiffs are individuals and a corporation who reside in Hawaii and claim to have suffered pecuniary injury when they purchased domestic ocean cargo shipping services on west coast Hawaii routes.

The Court held that plaintiffs did not meet their burden to show causation or redressability, two requisite elements for Article III standing. The panel further held that although it was possible that plaintiffs could establish standing if they amended their complaint, any amendment would be futile because plaintiffs’ Commerce Clause challenge to the Jones Act would fail on the merits. The Court held that an amended complaint would be subject to dismissal for failure to state a claim because the enactment of the Jones Act was not beyond the authority assigned to Congress under the Commerce Clause.

The Court also rejected plaintiffs’ claim alleging that the Jones Act violated protections guaranteed under the Due Process Clause of the Fifth Amendment.



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