Couple Challenge|’Competitor’s Veto’

PHILADELPHIA (CN) - Pennsylvania gives moving companies unconstitutional "competitor's veto" power over potential rivals, husband and wife entrepreneurs claim in Federal Court.

Cosmo and MaryAnne Losco sued the Pennsylvania Utilities Commission on Tuesday, claiming the board gives established businesses unconstitutional powers that are against the public interest.

"After years of working for others, the Loscos decided that they would like to start their own business," the couple say in the complaint. So Cosmo founded an LLC in suburban Telford, which then bought two businesses - a mover and a junk hauler - intending to operate both of them as movers, with his wife as business manager.

But "Pennsylvania law effectively forbids a person from operating a moving

company without getting permission from his or her own competition," the Loscos say. They can be criminally prosecuted if they operate such a business without a Certificate of Public Convenience from the defendant PUC. And to get the certificate, they must undergo an "arbitrary and irrational licensing procedure."

Under state law, the PUC notifies other moving companies of their application, and invites them to file protests. If a business protests, "the Loscos' application will be delayed for 20 days to encourage them to request a smaller radius of operation, wherein they will not compete economically against existing businesses," the Loscos say in the lawsuit.

Even if no one protests, the Loscos must attend a hearing before the PUC, which they call "an expensive and time-consuming process requiring them to hire a lawyer." At the hearing, they must prove that "the granting of such certificate is necessary or proper for the service, accommodation, convenience, or safety of the public," they says, citing Pennsylvania law.

The Loscos say no state law defines "necessary," "proper," or "convenience."

"These statutes and regulations give established household goods moving companies a special privilege not accorded to others by allowing them to impose burdens on or prohibit their own potential competition, without regard for the applicant's fitness or capacity to practice the trade, or any other legitimate government interest," the Loscos say. They claim the law applies only to moving companies.

They seek declaratory judgment that the law is unconstitutional, and want its enforcement enjoined, plus attorney's fees.

They are represented by Mark Jakubik.

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit