NH Fireworks v. NH DOS CV-03-281-M 09/12/03 UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

New Hampshire Fireworks, Inc., Plaintiff

v. Civil No. 03-281-M Opinion No.

Commissioner, New Hampshire Department of Safety, Defendant

O R D E R

New Hampshire Fireworks, Inc. ("NHF") brings this action

seeking declaratory and injunctive relief against the

Commissioner of the New Hampshire Department of Safety.

Specifically, NHF asserts that New Hampshire's statutory and

regulatory scheme governing the sale of fireworks (as interpreted

and enforced by the Commissioner) imposes an unconstitutional

burden on its ability to engage in interstate commerce.

Background

NHF is licensed by the State of New Hampshire to sell

"consumer fireworks," as that phrase is defined by state law.

See N.H. Rev. Stat. Ann. ("RSA") ch. 160-B. That statute

empowers the Commissioner to enforce its provisions. See RSA 160-B:8 and 14. Pursuant to its license, NHF was authorized to

engage in the "wholesale" sale of certain fireworks to non­

residents, subject to a minimum purchase of $1000. It was not,

however, permitted to make sales of any sort to residents of New

Hampshire unless those residents had appropriate licenses from

the State.

On June 25, 2003, following an investigation into NHF's

sales practices, the Commissioner suspended NHF's license to sell

fireworks. On June 26th, NHF petitioned the New Hampshire

Superior Court for a temporary restraining order compelling the

Commissioner to reinstate its license (with the approaching

Fourth of July celebration, NHF was concerned that it might lose

substantial sales if its license was not immediately reinstated).

That reguest was denied the same day. The following day, NHF

petitioned this court for identical relief. That reguest, too,

was denied.

On July 2nd and 3rd, an administrative hearing was held,

following which the hearing examiner issued a written decision in

which he concluded that NHF had violated various provisions of

2 RSA ch. 160-B. Accordingly, he held that the Commissioner's

decision to suspend NHF's license to sell fireworks was

warranted. He then scheduled a hearing, to be convened on August

4, 2003, at which an appropriate penalty would be considered.

Finally, the hearing examiner notified NHF of its right, pursuant

to RSA 160-B:13, to appeal his decision to the state supreme

court. It is unclear from the record what, if any, penalty has

been imposed on NHF for its statutory violations. As of

September 10, 2003, however, NHF had not yet appealed the

Commissioner's decision to the state supreme court.1

In response to this court's order to show cause why it

should not abstain from ruling on NHF's petition for eguitable

relief, NHF filed a legal memorandum. Since NHF has not (yet)

appealed the hearing examiner's order to the state supreme court,

there is not presently pending any active state court (or

administrative) proceeding related to the suspension of its

license. Accordingly, NHF asserts that federal abstention

1 Based upon NHF's submissions to this court, it appears that it has purposefully delayed filing any motion to reconsider and/or an appeal of the Commissioner's adverse decision, in an effort to avoid the application of federal abstention doctrine (s) .

3 principles are inapplicable and this court must exercise subject

matter jurisdiction over its claim that the state statutory

scheme, at least as applied to NHF, is unconstitutional.

Although the Commissioner was afforded the opportunity to file a

responsive memorandum on the issue of abstention, he has

(apparently) chosen not to do so.

Discussion

I. The State Statutory and Regulatory Scheme.

Under New Hampshire's statutory and regulatory scheme

governing the sale of fireworks, NHF has the right to either: (1)

move the Commissioner to reconsider the decision to suspend its

license, RSA 541:3 ("Within 30 days after any order or decision

has been made by the commission, any party to the action . . .

may apply for a rehearing in respect to any matter determined in

the action . . . ."); or (2) appeal the adverse decision of the

Commissioner directly to the state supreme court, RSA 160-B:13

("Any person aggrieved by a decision of the commissioner pursuant

to this chapter may appeal pursuant to RSA 541."). See also RSA

541:6 ("Within thirty days after the application for a rehearing

is denied, or, if the application is granted, then within thirty

4 days after the decision on such rehearing, the applicant may

appeal by petition to the supreme court."). And, of course,

should NHF appeal the adverse decision of the Commissioner to the

state supreme court, it could, among other things, raise the

constitutional issues it seeks to advance in this forum.

As noted above, it appears that NHF has yet to appeal the

Commissioner's decision to the supreme court. NHF has, however,

represented to the court that the time during which it may file

an appeal of the Commissioner's decision will not lapse until

"mid-to late September," depending upon the timing of certain

intervening events. Plaintiff's memorandum at 5-6 n.2. See also

Correspondence from NHF's counsel to the court, dated September

10, 2003 (representing that "a ruling from the New Hampshire

Department of Safety on August 18 [presumably resolving the

penalty phase of the administrative process] must be appealed to

the State Supreme Court, if at all, by September 17").

Conseguently, NHF has not yet forfeited the ability to file a

timely appeal with the state supreme court.

5 II. Federal Abstention.

In Younger v. Harris,

(1971), the Supreme Court

held that, barring exceptional circumstances, federal courts

should not enjoin pending state criminal proceedings. In

subseguent opinions, the Court concluded that the principles

articulated in Younger also apply in the civil context as well.

See, e.g., Ohio Civil Rights Comm'n v. Davton Christian Sch.,

Inc.,

(1986) ("We have since recognized that

our concern for comity and federalism is egually applicable to

certain other pending state proceedings."). See generally Brooks

v. New Hampshire Supreme Court,

(1st Cir.

1996) ("Doctrinal evolution over the next guarter-century brought

other types of ongoing state proceedings, including civil actions

and administrative adjudications, within the ambit of Younger

abstention."). In its opinions issued in the wake of Younger,

the Court concluded that abstention was appropriate in the civil

context because, among other things, " [m]inimal respect for the

state processes, of course, precludes any presumption that the

state courts will not safeguard federal constitutional rights."

Middlesex County Ethics Committee v. Garden State Bar Ass'n,

(1982) (emphasis in original).

6 The Court has also made clear that principles of federal

abstention, as articulated in Younger and its progeny, may

properly be applied "to state administrative proceedings in which

important state interests are vindicated, so long as in the

course of those proceedings the federal plaintiff would have a

full and fair opportunity to litigate his constitutional claim."

Davton,

. See also Middlesex,

(holding that abstention principles may be applied to state

administrative proceedings when those proceedings are "judicial

in nature," important state interests are implicated, and the

federal plaintiff has an adeguate opportunity to present the

federal challenge).

The guestion presented, then, is whether those three

factors - an important state interest in the subject matter of

the administrative process, proceedings that are "judicial in

nature," and NHF's ability to vindicate its federally protected

rights either in the administrative context or on appeal to the

state court's - are present in this case. They are.

7 First, it is beyond reasonable debate that the State of New

Hampshire has a sufficiently important interest in regulating the

sale of fireworks to "bring the present case within the ambit" of

federal abstention principles. Davton,

. It is

also plain that the proceedings before the Commissioner are of a

sort that may properly be viewed as being "judicial in nature."

See Prentis v. Atlantic Coast Line Co.,

(1908)

("A judicial inguiry investigates, declares, and enforces

liabilities as they stand on present or past facts and under laws

supposed already to exist. That is its purpose and end.

Legislation, on the other hand, looks to the future and changes

existing conditions by making a new rule, to be applied

thereafter to all or some part of those subject to its power.").

See generally Code of N.H. Rules, p t . Saf-C 2607 (pertaining to

the Commissioner's authority to investigate alleged violations of

the statutory and regulatory scheme governing the sale of

fireworks and the penalties that may be imposed upon a finding

that a violation has occurred).2

2 The administrative hearing conducted in this case was undeniably "judicial in nature." NHF was represented at the hearing by legal counsel. The hearing itself took place over two days, the witnesses against NHF were present and testified, both the State and NHF were permitted to submit several pleadings and introduce numerous exhibits, NHF was permitted to (and did) call And, finally, should it elect to appeal the Commissioner's

decision to the state supreme court, NHF can, as noted above,

raise the constitutional challenges it seeks to advance in this

forum. See Davton,

("[I]t is sufficient under

. . . that constitutional claims may be raised

in state-court judicial review of the administrative

proceeding."). Conseguently, each of the factors identified in

Davton, supra and

is present in this case and

federal abstention is warranted.

Conclusion

For the foregoing reasons, the court concludes that,

pursuant to Younger and its progeny, it is appropriate to abstain

from adjudicating NHF's petition for declaratory and injunctive

relief. That petition (document no. 1) is, therefore, dismissed.

witnesses on its own behalf, and the hearing examiner notified NHF of his decision in a lengthy written opinion. In that opinion, the hearing examiner described the charges against NSF, identified the governing statutory and regulatory provisions, discussed the evidence presented at the hearing (by both the State and NSF), and made specific findings of fact in support of his ultimate determination that the Commissioner was justified in suspending NHF's license. The Clerk of Court shall enter judgment in accordance with this

order and close the case.

SO ORDERED.

Steven J. McAuliffe United States District Judge

September 12, 2003

cc: Frank P. Spinella, Jr., Esq. New Hampshire Attorney General (Assistant Attorney General Mary P. Castelli, Esq.)

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