author: ROBERT D. POTTER, Chief Judge.

text:
    JFC INVESTORS LTD., d/b/a Fuel City, Plaintiff, v. GULF PRODUCTS DIVISION OF BP OIL, INC., Defendant. JAXON PETROLEUM LTD. d/b/a Catawba Auto Truck Plaza, Plaintiff, v. GULF PRODUCTS DIVISION OF BP OIL, INC., Defendant.
    Nos. C-C-85-270-P, C-C-85-271-P.
    United States District Court, W.D. North Carolina, Charlotte Division.
    May 9, 1985.
    Robert J. Bernhardt, Charlotte, N.C., for plaintiff.
    James H. Kelley, Jr., F. Joseph Treacy, Jr., Petree, Stockton, Robinson, Vaughn, Glaze & Maready, Winston-Salem, N.C., for defendant.
   ORDER

ROBERT D. POTTER, Chief Judge.

On April 17, 1985, Plaintiff, JFC Investors, Ltd., d/b/a Fuel City (“JFC”) and Plaintiff Jaxon Petroleum Ltd., d/b/a Catawba Auto Truck Plaza (“Jaxon”) instituted two separate actions seeking damages, and preliminary and permanent injunctive relief as a result of alleged violations of the Petroleum Marketing Practices Act (“PMPA”), 15 U.S.C. § 2801, et seq. by the Defendant, Gulf Products Division of BP Oil, Inc. (“Gulf/BP”).

Although there are two separate lawsuits the terms of the franchise contracts and the facts giving rise to the alleged violations of the PMPA are identical. Accordingly, a consolidated hearing on both Plaintiffs’ motions for a preliminary injunction was held on April 29, 1985. The Plaintiffs were represented by Robert J. Bernhardt. The Defendant was represented by James H. Kelly, Jr., F. Joseph Treacy, Jr., and Roderick C. MacKinnon.

After carefully considering the evidence submitted, which evidence was largely uncontested, the legal memoranda and the arguments of counsel, the Court enters the following findings of fact and conclusions of law:

FINDINGS OF FACT

Plaintiff JFC operates a Gulf branded retail truck stop on Interstate 77 near Charlotte, North Carolina pursuant to a written Dealer Agreement (the franchise agreement) dated January 1, 1980. JFC either owned or leased from someone other than Gulf the truck stop and the petroleum dispensing equipment located at the station.

Plaintiff, Jaxon, operates a Gulf branded retail truck stop on Interstate 40 near Catawba, North Carolina. Jaxon operates this truck stop pursuant to a written Retail Dealer’s Agreement (the franchise agreement) with Gulf Oil Corporation executed on August 27,1981. Jaxon either owned or leased from someone other than Gulf their truck stop and the petroleum dispensing equipment.

Jaxon and JFC were under common management with Jim Maner as President and Ralph Clark as Executive Vice-President.

In 1984 Chevron Corporation purchased Gulf Oil Corporation. As part of this purchase the Federal Trade Commission ordered Gulf/Chevron to divest itself of certain assets, including its marketing assets in North Carolina.

In the fall of 1984, Gulf/Chevron announced that it had agreed to sell its marketing assets in North Carolina to BP Oil, Inc. (Gulf/BP).

Plaintiffs were notified of this pending sale and were further notified that Gulf/Chevron would be assigning their contracts to Gulf/BP and that such contracts would remain in full force and effect. In the middle part of January 1985, Plaintiffs were notified that the changeover from Gulf/Chevron to Gulf/BP would take place effective February 1, 1985.

On February 1, 1985 Gulf/Chevron assigned to Gulf/BP the dealer contracts of Plaintiffs with Gulf/Chevron.

Both Jaxon and JFC contracts with Gulf provide in pertinent part:

If at any time the financial responsibility of purchaser shall become impaired or unsatisfactory to seller, or should purchaser be in arrears in his account with seller, seller may require, as a condition of making further deliveries under this contract, payment by purchaser of all past due accounts and cash payment for all future deliveries.”
Terms of payment — Cash on delivery or as approved by seller.
Purchaser agrees not to engage in or permit any illegal or improper act or conduct, on or about the premises where Gulf identification is displayed and Gulf brand products are sold, which is detrimental to seller or any member of the public.
Purchaser hereby acknowledges that Gulf indicia, including without limitation, Gulf trademarks, Gulf service-marks, displays, symbols, color arrangement and other words and devices which identify Gulf Oil Corporation, its products, services and goodwill, are valuable property rights belonging exclusively to Gulf Oil Corporation. Any use of such Gulf indicia by purchaser, including use of stationery, invoices, delivery tickets, equipment, in directory or other advertising and .the like in connection with this Agreement is solely for the purpose of advertising the product and/or services of Gulf Oil Corporation.
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Third: Said equipment shall be used solely for the storage, handling and advertising of petroleum products purchased by the party of the second part from the party of the first part, and any other use of said equipment shall be a breach of this contract, justifying immediate cancellation thereof by the party of the first part, in which event the party of the first part shall have the right to immediately enter upon said premises and remove said equipment, and every party thereof, without liability to the party of the second part for damages, direct or incidental, resulting from such removal.
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Seventh: Said party of the second part may use the Gulf trademarks, brand names, and color schemes to identify and advertise Gulf branded products at his location in connection with any of the above-listed equipment; however, party of the second part shall not sell under Gulfs identification, trademarks, or brand names any product not bearing the Gulf brand or any mixture or adulteration of any Gulf branded products with each other or with any other product or material. Upon request, the party of the first part shall have the right to enter the premises for the purpose of taking and recording the volume meter readings on any of the above equipment through which Gulf branded products are dispensed. [Emphasis supplied].

Since as early as 1982, both JFC and Jaxon have been experiencing financial difficulties. Jaxon and JFC management have been attempting since 1983 to find other investors to refinance and restructure the businesses.

Some time before 1984 Gulf began requiring both JFC and Jaxon to deliver by courier to the Gulf terminal in Paw Creek the credit card slips, cash and company checks which would be utilized to purchase petroleum products. Upon receipt of such payments at the Gulf terminal, Gulf would allow the Plaintiffs to purchase their fuel. Monies received prior to shipment of the gasoline products by Gulf were applied to the oldest invoices owed by Jaxon and JFC under a “Vio, net 30” payment system.

Immediately prior to the February 1, 1985 transfer to Gulf/BP, JFC and Jaxon owed Gulf/Chevron approximately $525,-000. 00. This debt remained an asset of Gulf/Chevron and was not transferred to Gulf/BP.

Gulf/BP management began in the middle part of January 1985, reviewing the credit worthiness of all of the dealers it was taking assignments of contracts from Gulf/Chevron. Ronnie Mantón who was to assume responsibilities of District Manager of Gulf/BP in North Carolina, specifically reviewed the Plaintiffs’ past credit history with Gulf/Chevron and spoke with the field marketing personnel regarding the continuing financial restructuring of the Plaintiffs. Based on this investigation Mr. Mantón decided that Gulf/BP would only do business with the Plaintiffs on a COD/cash basis.

On January 27, 1985 Mr. Mantón contacted Larry Baucom, the Retail Marketing Representative for Gulf/BP in the Charlotte, North Carolina area, and asked him to inform Plaintiffs that effective February 1, 1985, Gulf/BP would be supplying product to them and that such product would have to be paid for by the Plaintiffs on a COD basis, by cash, Gulf credit card slips, or certified company checks. This procedure did not differ significantly from the working arrangement that Gulf/Chevron had with the Plaintiffs. The difference is that Gulf/BP was no longer willing to accept an uncertified company check, instead requiring a certified check. As before, payment by Plaintiffs was going to have to be received before the product would be delivered. Since Gulf/BP was not assuming the accounts receivable of Gulf/Chevron there were no outstanding invoice to which the Plaintiffs’ payments could be applied by Gulf/BP. As the payments by Plaintiffs to Gulf/BP would not be applied to any outstanding invoices owed to Gulf/Chevron such payments now would be true COD payments for product sold to Plaintiffs by Gulf/BP.

Gulf/BP notified the Plaintiffs on January 27, 1985 that effective February 1, 1985 they would have to pay by certified check, cash and/or credit card slips. Mr. Maner responded that he would not purchase any products from Gulf/BP under such an arrangement and that he would go out and purchase his products from other suppliers. Mr. Baucom cautioned Mr. Man-er that Gulf/BP would not condone Mr. Maner’s purchase of fuel from suppliers other than Gulf and the subsequent reselling of such products as Gulf branded products.

From February 1, 1985 until March 25, 1985 Plaintiffs purchased very little product from Gulf/BP. In fact the majority of the fuel purchased by the Plaintiffs from Gulf/BP during this period was with Gulf credit card slips which slips would only be accepted by Gulf. JFC, which under normal circumstances would have purchased 394,504 gallons of product a month, only purchased 55,400 gallons in a month and a half. Jaxon, which under normal circumstances would have purchased 226,481 gallons a month, only purchased from Gulf/BP 35,200 gallons in one and a half months.

Mr. Baucom, during the time from February 1, 1985 through March 25, 1985, personally observed the tanker truck owned by JFC and Jaxon pulling into the Hess terminal in Paw Creek, North Carolina, loading and leaving that terminal. The Plaintiffs admit that during this period of time they purchased most of their fuel from non-Gulf dealers.

Both JFC and Jaxon truck stops display the Gulf brand identification signs on their dispensing equipment and on large circular signs. They accept Gulf credit cards in payment for any Gulf branded products purchased from the locations. During this period of time, both truck stops continued to utilize their prominently displayed Gulf branded identification signs on their pumps and on their large interstate signs. Mr. Baucom concluded that Mr. Maner was in fact misbranding the Gulf products and he so informed his superior. The Plaintiffs admit they were misbranding and commingling.

On March 27, 1985 Mr. Baucom and Neil Price of Gulf/BP hand delivered to Mr. Maner, President of JFC and Jaxon, notice of termination of Plaintiffs’ respective contracts with Gulf/BP, along with summary notices under the PMPA, such termination to be effective April 4, 1985. Copies of such notices were attached to the Complaints filed in these actions. These notices specified that the terminations were on account of Plaintiffs’ commingling and misbranding of Defendant’s products. After delivery of such notices to the Plaintiffs, counsel for the Plaintiffs requested an extension of time on the termination so that Plaintiffs could locate another permanent supplier. Based on such request, Gulf/BP agreed to extend the effective date of the termination from April 4, 1985 until April 18, 1985. A copy of such extension is also attached to the Complaints in these actions.

On April 17, 1985, the Plaintiffs filed these actions seeking preliminary injunctions enjoining the Defendant from going forth with the terminations on April 18, 1985. The Defendant refrained from actual terminations until this matter could be heard.

Plaintiffs’ contentions in support of their motions for a preliminary injunction are identical. They claim that Gulf/BP violated the PMPA by failing to give them ninety days’ notice of termination. Further, although the Plaintiffs admit that they have been misbranding and commingling the Gulf product since February 1, 1985 in clear contravention of their franchise agreements they contend their conduct is excusable because they were coerced into this conduct by the Defendant’s COD payment plan. The Court finds neither argument tenable under the circumstances.

CONCLUSIONS OF LAW

A. The Standard for a Preliminary Injunction Under The Petroleum Marketing Practices Act

In deciding whether to issue a preliminary injunction under the PMPA the Court considers whether there was a termination of the franchise, whether there exists sufficiently serious questions on the merits, and the balance of the hardships. 15 U.S.C. § 2805(b). Specifically, Section 2805(b) provides in pertinent part

... the court shall grant a preliminary injunction if—
(A) the franchisee shows—
(i) the franchise of which he is a party has been terminated or the franchise relationship of which he is a party has not been renewed; and
(ii) there exists sufficiently serious questions going to the merits to make such questions a fair ground for litigation; and
(B) the court determines that, on balance, the hardships imposed upon the franchiser by the issuance of such preliminary injunctive relief will be less than the hardship which would be imposed upon such franchisee if such preliminary injunctive relief were not granted.

Thus, under the PMPA the franchisee must establish that there exist sufficiently serious questions going to the merits to make such questions a fair ground for litigation and that failure to grant injunctive relief will be more burdensome on the plaintiff than the burden on the defendant if the injunction is issued.

The issue of what constitutes sufficiently serious questions as to the merits differs significantly from the Plaintiffs’ showing in a Fed.R.Civ.P. 65 injunction. Saad v. Shell Oil Company, 460 F.Supp. 114 (Mich.1978). The franchisee in Saad sought a preliminary injunction pursuant to the PMPA to restrain the termination of its franchise for failure to comply with the cleanliness requirements in the franchise agreement. In considering the legal relationship between likelihood of success on the merits and sufficiently serious questions going to the merits, the Court stated:

Clearly, although Congress wanted and designed an act to protect the franchisee from overbearing franchisers, it did not desire to impose upon the courts needless litigation. The use of the terms “serious question” and “fair ground” indicates that it intended a significant showing of something that would constitute some reasonable chance of success even though it could not be shown that there was a likelihood of probability of success as is required in the ordinary preliminary injunction matter.
The test applied in the ordinary case is “Has the petitioner made a strong showing that he is likely to prevail on the merits ... ?” Virginia Petroleum Jobbers Ass’n v. Federal Power Commission, 104 U.S.App.D.C. 106, 259 F.2d 921 (1958). Other phrases used are “strong likelihood of success”, or “substantial indication of probable success”. In the ordinary preliminary injunction case, the court’s attention is directed at a “strong showing” and at “probability”.
This statute is intended to require less than that but is clear that it does require something. Instead of a “strong showing” or “probability” of success, the terms “serious question” and “fair ground for litigation” suggest merely a reasonable chance of success, something far less than the probability or likelihood required by Virginia Petroleum Jobbers, supra, and Corning Glass Works v. Lady Cornelia, Inc., 305 F.Supp. 1229 (E.D.Mich.1969).
The court, therefore, must look at the facts produced to determine whether they indicate “serious questions” that go to the merits and whether such questions make a “fair ground” for litigation or some reasonable chance of success. If the questions are not serious or they do not go to the merits or they do not make fair grounds for litigation or a reasonable chance of success, the injunction should not issue.

460 F.Supp. at 116-17.

Thus, in order to establish that there exist sufficiently serious questions going to the merits, a plaintiff must establish some reasonable chance of success on the merits or the existence of serious questions constituting a fair ground for litigation. If the plaintiff satisfies this initial requirement, he must next demonstrate that the hardship on the plaintiff without an injunction will be greater than the hardship on the defendant with an injunction.

B. Plaintiffs’ Reasonable Chance of Success On Their PMPA Claims

The PMPA was enacted to protect petroleum franchisees from arbitrary or discriminatory termination and nonrenewal of their franchises. Congress wanted to equalize the perceived disparity of bargaining power in an economic sense between major oil companies and service station dealers and jobbers. Congress, however, recognized that the franchisers had a legitimate need to terminate or non-renew a franchisee for violations of their agreements which were so serious as to undermine the entire relationship. Hence, the Act specifies permissible grounds for termination of franchisees and the manner in which such termination is effectuated.

Section 2802(c)(10) of the PMPA allows a franchiser such as Gulf/BP to terminate a franchise if the franchisee engages in misbranding, commingling and adulteration of petroleum products.

The second prong of the PMPA test looks at the manner in which the notification of termination was given. Even if a franchiser under PMPA has a permissible reason for terminating the franchise, notice of such termination must be given to the franchisee in a manner proscribed by 15 U.S.C. § 2804. Less than ninety days’ notification is permitted under Section 2804(a)(b)(1) under circumstances in which it would not be reasonable to comply with a ninety day requirement.

In the instant cases, both Plaintiffs were given notice of termination on March 27, 1985 by hand delivery of written notices of termination. Both of these notices are attached to the Complaints in these actions. Those notices articulate the reasons for the termination and cite the Plaintiffs to the specific sections of the PMPA under which the termination is being accomplished. Additionally, a summary of the PMPA was attached to the notices and delivered to the Plaintiffs. The notice informed the Plaintiffs that the termination would take effect on April 4, 1985. Upon request of the Plaintiffs, a subsequent letter from Gulf/BP to the Plaintiffs extended such termination date from April 4,1985 to April 18, 1985. Further, the Defendant did not effectuate the termination until the Plaintiffs’ motions were resolved by the Court.

The Plaintiffs’ claim that they have received insufficient notice of termination under the PMPA is erroneous, in light of their admitted intentional acts of misbranding and commingling. See, e.g., Wisser Company, Inc. v. Mobil Oil Corporation, 730 F.2d 54 (1984). In Wisser, the franchisee brought an action under the PMPA for an injunction alleging that less than ten days’ notice of termination for misbranding was unreasonable. Although the dealer denied misbranding, Mobil hired a private investigator who observed and photographed the non-Mobil gasoline delivery to the station, which at that time was clearly identified as a Mobil station. Consequently, by letter, Mobil notified the dealer that it was terminating the contract immediately because of misbranding. Additionally, Mobil requested the franchisee to arrange to return immediately the equipment loaned to it.

The Second Circuit Court of Appeals in Wisser directly addressed the issue of whether a ten-day notice of termination was appropriate under the PMPA, when the franchisee was clearly guilty of misbranding:

Early versions of the PMPA required 90-days notice for all terminations, regardless of the cause, see, e.g., H.R. 16510 and S. 1694, reprinted in Franchised Petroleum Dealers: Hearings on H.R. 16510 ... before the Subcomm. on Communications and Power of the House Comm. on Interstate and Foreign Commerce, 93rd Cong., 2d Sess. 3-9, 24-27 (1974) . The legislative history and hearings, however, indicate that § 2804(b)(1)(A) was added to dispense with the lengthy notice requirement where, for example, a franchisee committed serious defaults of the franchise agreement, such as misbranding. See S.Rep. No. 120, 94th Cong., 1st Sess. 8 (1975) (predecessor bill, S. 323; misbranding specifically identified as circumstance warranting less than 90-days notice of termination); Petroleum Marketing Practices: Hearings on H.R. 13000 ... and S. 323 before the Subcomm. on Energy and Power of the House Comm. on Interstate and Foreign Commerce, 94th Cong., 2d Sess. 334-36, 340-41 (1976) .
In light of the gravity of Wisser’s conduct, we conclude that Wisser has not raised a serious question as to the reasonableness of the forthwith notice of termination. If Wisser was engaged in passing off non-Mobil gasoline under the Mobil trademark, as the district court found Mobil probably would be able to prove, Wisser was committing a serious violation of Mobil’s contract and property rights and it was perpetrating a fraud on the public. There was also evidence before the district court that this conduct had been going on for as long as six months before Mobil was able to confirm it. We believe that Mobil was justified in taking steps to stop this practice and to disassociate itself from Wisser immediately. Were Mobil required to wait 90 days or some shorter period between notice and the effective date of termination, there is no reason to believe that Wisser would not have used the time to continue its alleged misbranding to its profit. Moreover, Wisser owned the premises, so it was not faced with immediate eviction and associated financial ruin, and Wisser owns a number of other service stations. True, Mobil recovered its signs and operating equipment from the premises, but Wisser had no right to continue to use Mobil’s trademark, and it would not be unduly burdened by having to rent or buy operating equipment of its own. Wisser thus could continue to sell gasoline it was buying from other sources, but not under the Mobil trademark, with perhaps a temporary delay while Wisser obtained and installed substitute equipment. Under the circumstances, forthwith termination was reasonable. See Esso Standard Oil Co. v. Vargas, Civ. No. 79-570 (D.P.R. Oct. 24, 1979) [motion to dismiss; less than 10-days notice of termination for misbranding held reasonable under 15 U.S.C. § 2804(b)(1)(A) ].

730 F.2d at 60-61 (Emphasis supplied).

In the present cases, the Plaintiffs have admitted in their Complaints and at the hearing, commingling and misbranding. It is clear from all of the other evidence produced in the Affidavits that the Plaintiffs’ misbranding and commingling was pervasive and, but for the actions of Gulf/BP, would have continued at the rate of approximately 18,000 gallons per day. As the Court noted in Wisser, if Gulf/BP were required to wait ninety days or some shorter period between notice and the effective date of termination, there is no reason to believe that the Plaintiffs would not have used this time to continue the practice of commingling and misbranding. Additionally, there is no reason why the Plaintiffs cannot, once they divest themselves of the Gulf signs and insignias, continue to sell the petroleum products they were buying from other sources without using the Gulf trademark.

Under the circumstances of these cases, immediate termination was both reasonable and proper. Notice of termination was given on March 27, 1985 and did not take effect until April 18, 1985 [including the extension]. Thus, Plaintiffs herein were given twenty-two days’ notice of termination, twelve more than that approved by the Court in Wisser.

The Plaintiffs’ claim that they were “forced” to commingle and misbrand fuel because of a change in credit policy is not plausible factually and is legally insufficient. The Plaintiffs have never asserted that they could not obtain a certified check. Rather, their excuse relates solely to the logistics in having to drive to a bank to obtain certification. Further, the Plaintiffs concede Gulf/BP had the right under the contracts to require cash payments for all future deliveries of products. The agreements indicated that the terms of payment were cash on delivery or on credit as approved by the seller. In January of 1985 Plaintiffs collectively owed Gulf/Chevron approximately $525,000. Thus, Defendant merely exercised its contractual right to require cash payments. This change to certified check does not constitute a valid reason for Plaintiffs to breach their contract by commingling and misbranding Defendant’s products. See, Mobil Oil Corporation v. Fadaee, Case No. 84 CV 3057 (E.D.Mich.1984). Itin Oil Co. v. Mobil Oil Corp., 527 F.Supp. 898 (Mich.1981); Stewart v. Shell Oil Co., 518 F.Supp. 6 (Nev. 1980).

In conclusion, the Plaintiffs are not able to demonstrate that there exists sufficiently serious questions going to the merits to make such questions a fair ground for litigation.

C. Balance of Hardships

Having found that the Plaintiffs cannot meet their burden of demonstrating that there exists sufficiently serious questions on the merits Court need not consider the balance of hardships. See, Wiser, supra at 61; Kesselman v. Gulf Oil Corporation, 479 F.Supp. 800 (E.D.Pa.1979).

D. Conclusion

As the Plaintiffs have failed to sustain their burden of establishing sufficiently serious questions going to the merits of the litigation the Court concludes that the Plaintiffs’ motions for preliminary injunction should be denied.

IT IS, THEREFORE, ORDERED that:

(1) Plaintiff JFC’s motion for a preliminary injunction in G-C-85-271-P is DENIED;
(2) Plaintiff Jaxon’s motion for a preliminary injunction in C-G-85-270-P is DENIED;
(3) Defendant may proceed immediately to remove its signs and the decals bearing its trademarks and its credit card imprinters for the truck stops in question.


source: Caselaw Access Project

author: BARBOUR, District Judge.

license: Public Domain

text:
    William L. SMITH and Clara Smith, Plaintiffs, v. ANDERSON-TULLEY COMPANY, T.C. Norwood, Jr., Hicks McNair, Luther T. Barber and Bechtel Power Corporation, Defendants.
    Civ. A. No. W84-0030(B).
    United States District Court, S.D. Mississippi, W.D.
    May 10, 1985.

      John W. Prewitt, Sr., Prewitt & Courteau, Vicksburg, Miss., for plaintiffs.
    Thomas M. Murphree, Jr., Watkins & Eager, Jackson, Miss., for Bechtel Power Corp.
    Jerome B. Steen, T.E. Davidson, Steen, Reynolds, Dalehite & Currie, Jackson, Miss., for Luther T. Barber.
    R.E. Parker, Jr., William R. Lancaster, Varner, Parker & Sessums, Vicksburg, Miss., for Anderson-Tulley Co.
    Daniel J. O’Beirne, O’Beirne & Ball, Natchez, Miss., Melvin H. McFatter, Port Gibson, Miss., for T.C. Norwood and Hicks McNair.
   ORDER

BARBOUR, District Judge.

This action was filed by William L. Smith and his wife, Clara Smith, to recover for injuries received as a result of an automobile accident which occurred on Highway 61 on March 16, 1983. William Smith was a passenger in a vehicle driven by Luther T. Barber at the time of the accident. His wife has filed for her loss of consortium and related claims.

The vehicle driven by Barber collided with a vehicle driven by Hicks McNair and owned by T.C. Norwood, Jr. Smith and Barber were employed at the Grand Gulf construction project in Claiborne County, Mississippi, by Bechtel Power Corporation. Hicks McNair was employed by T.C. Nor-wood, Jr., who was engaged in the business of cutting and hauling timber for Anderson-Tulley Company.

Presently before this Court is the Motion of the Defendant Bechtel Power Corporation for Summary Judgment, the Motion of Norwood to limit his liability to $100,000 and exonerate him from liability for any amount above $100,000 and the Motion of the attorney for United States Fidelity & Guaranty Company representing T.C. Nor-wood, Jr. and Hicks McNair to withdraw as counsel, the limits of the insurance policy having been paid to the Bankruptcy Court, allegedly ending the duty of the insurance company to defend under the insurance policy. This Court will address the Motions in the order in which they are set forth above.

I.

The basis of the Motion for Summary Judgment made by Bechtel is that Barber was not acting within the course and scope of his employment when the accident occurred causing the injuries to Smith. Accordingly, it is asserted that Bechtel may not be held vicariously liable on the basis of respondeat superior.

Both parties agree that Barber left work at Bechtel at 3:30 P.M. and the accident occurred at 4:00 P.M. Barber and Smith were returning home to Vicksburg. Barber was paid $6.00 per day travel expense pursuant to a union contract. (The motion of the Defendant Bechtel erroneously states that Barber was paid $6.00 per week). Bechtel submitted an employer’s first report of injury or occupational disease on Barber to Travelers Insurance Company, the workmen’s compensation carrier for Bechtel. Barber was paid workmen’s compensation as a result of this claim.

At the time this Motion was made, Plaintiff defended the Motion largely under the theory that further discovery would reveal facts which would render this issue inappropriate for summary judgment. No supplementation of the Plaintiff’s response has been forthcoming even though the Motion was filed approximately eight months ago.

The Motion of the Defendant Bechtel rests on the premise that Barber was going home from work and not being compensated for his time. He was not subject to the direction or control of his employer and the Defendant should not be held liable for his acts. The response of the Plaintiff is that Bechtel filed a workmen’s compensation claim and the employee was paid $6.00 per day for travel expenses.

The extension of the workmen’s compensation laws is not always coterminous with the related theories in tort law for respondeat superior purposes. See Stepney v. Ingalls Shipbuilding Division, Litton Systems, Inc., 416 So.2d 963, 966 (Miss.1982) (compensation allowed under act where employee would not be in the course of his employment for respondeat superior purposes). The fact that a claim was filed by Bechtel indicates only that it was aware of its responsibilities under the Workmen’s Compensation Act.

The Defendant relies on the decision of the Mississippi Supreme Court in Luther McGill, Inc. v. Cook, 306 So.2d 304 (Miss.1975). That lawsuit involved a factual scenario similar to the one before this Court. The Supreme Court held that as a matter of law that the proof fell short of establishing that the employee was acting within the scope of his employment when travelling to work for another company. McGill had made arrangements to pay the employee for the work he performed for the other company. McGill was then reimbursed for such payments as were made. The employee was paid a set weekly fee for travel expenses. The employee had filed for and obtained workmen’s compensation benefits arising out of the accident which occasioned the lawsuit. The Mississippi Supreme Court held that as a matter of law the evidence was insufficient to show that the employee was acting within the scope of his employment at the time of his accident, thereby subjecting McGill to vicarious liability.

While Barber in this case was compensated $6.00 per day for travel expenses, this certainly did not compensate him for his time. It is undisputed that Barber was not being paid an hourly wage at the time of the accident. It is likewise undisputed that Barber was on no special mission and was not engaged in the prosecution of his employer’s work in any fashion. He was commuting to his home from work. There is no special circumstance which brings him outside the general rule that an employer is not liable for the acts of his employees going to and returning from work.

In accordance with the above it is this Court’s opinion that the Plaintiff has raised no genuine issues of material fact and Bechtel should prevail with regard to the alleged vicarious liability for the injuries of the Plaintiff. Barber was not within the course and scope of his employment at the time of the accident. The Motion of Bechtel for Summary Judgment should be granted.

II.

The second motion before this Court is the Motion of Norwood to limit his liability to $100,000.00 and exonerate him from liability for any amount above $100,000.00. This Court has reviewed the bankruptcy court’s Order and the arguments of the attorneys and finds that no Order of this Court is necessary to enforce the orders of the bankruptcy court. What is before this Court is essentially an evidentiary question. It is unnecessary to enter an order limiting the liability of Norwood to effectuate the full faith and credit of the decision of the bankruptcy court. Additionally, this Court finds no precedent for granting such a limitation in a civil action of this nature. The decision of the bankruptcy court merely discharges the potential liability of Nor-wood in excess of the $100,000 of insurance covering this action. Accordingly, the Motion of Norwood to limit his liability or in the alternative to exonerate him from liability is denied.

III.

With respect to the Motion of the attorney to withdraw, Daniel O’Beirne, counsel for Norwood and McNair was retained by U.S.F. & G. pursuant to its duty to defend under the policy of insurance. U.S.F. & G. is not before this Court and it is inappropriate to construe provisions of the insurance policy and the scope of the duty to defend absent a lawsuit which contains this as an issue. The issue in this lawsuit is the liability, if any, of Norwood and McNair for injuries sustained by Smith and other related claims. This lawsuit is not the appropriate forum for the determination of the scope of the duty U.S.F. & G. has to defend this lawsuit.

Mr. O’Beirne by his Motion to Withdraw does bring this Court to the question of the ethical obligation he owes to his clients, Norwood and McNair. It is the determination of this Court that Mr. O’Beirne should not be allowed to withdraw without their consent or a valid and compelling reason for this Court to allow such withdrawal over their objection. The obligation of an attorney to defend his client is one of the paramount obligations undertaken in the attorney-client relationship. Canon 2 of the Code of Professional Responsibility provides that “A lawyer should assist the legal profession in fulfilling its duty to make legal counsel available.” Canon 5 of the Code of Professional Responsibility provides that “A lawyer should exercise independent professional judgment on behalf of a client.” Likewise, Canon 7 of the Code of Professional Responsibility is that “A lawyer should represent a client zealously within the bounds of the law.” Once these duties have been undertaken, an attorney may not be relieved of his duty without compelling reasons. Additionally, any conflicts should be completely disclosed to the client. An attorney retained by an insurance carrier to defend an insured represents the insured. See generally, Mallen, Professional Responsibility of Insurance Counsel, 1984 Mississippi Law Institute on Insurance Law and Practice 33. It is inappropriate for the Court to permit Mr. O’Beirne to withdraw at this juncture on the basis that the duty to defend of the insurer may have ended. The question of whether or not Mr. O’Beirne may withdraw is independent of and distinct from the obligation of U.S.P. & G. to defend. In reaching this decision this Court is aware that the underlying dispute between the insurer and the insured as to who bears responsibility for Mr. O’Beirne’s fees remains unresolved.

In accordance with the above it is the decision of this Court that the Motion of counsel for Norwood and McNair to withdraw is denied. The Court in making these remarks does not intend to indicate that it feels that Mr. O’Beirne has acted in an unethical manner. Mr. O’Beirne is faced with a dilemma not infrequently presented to insurance counsel. The Court is simply recognizing that the ethical as opposed to financial aspects of the dilemma should be of paramount consideration.

In summary, the Motion for Summary Judgment on behalf of the Defendant Bechtel Power Corporation is granted. A judgment consistent with this Opinion shall be entered by separate document consistent with Rule 58 of the Federal Rules of Civil Procedure. The Motion of the Defendant Norwood to limit his liability or to exonerate him for any liability in excess of the $100,000.00 tendered to the bankruptcy court is denied. The Motion of Daniel O’Beirne to Withdraw as Counsel for Nor-wood and McNair is denied.


author: EDWARD WEINFELD, District Judge.

text:
    UNITED STATES of America, v. Angel NIEVES, et al., Defendants.
    85 Crim. 244 (EW).
    United States District Court, S.D. New York.
    May 13, 1985.

      Rudolph W. Giuliani, U.S. Atty., for the S.D.N.Y., New York City, for the U.S.; Maria T. Galeno, New York City, of counsel.
    Lawrence Kessler, Hempstead, N.Y., for defendant Angel Nieves.
   OPINION

EDWARD WEINFELD, District Judge.

Angel Nieves and Edwin Pagan are named as defendants in a two count indictment charging them with (1) conspiracy to distribute and to possess with intent to distribute heroin, in violation of 21 U.S.C. §§ 812, 841, and (2) distribution of heroin within one thousand feet of Public School 28 in the Bronx, New York, in violation of 21 U.S.C. §§ 812, 841, 845a. Section 845a, cited in Count Two, was enacted on October 12, 1984. It provides for enhanced penalties upon conviction for selling narcotics within one thousand feet of a public or private elementary or secondary school. In the event of a conviction under this new statute, the term of imprisonment would be up to twice that, and the term of parole at least twice that, authorized for unlawful narcotics sales generally. In the event of a second or subsequent conviction under this section, the statute provides for the imposition of a mandatory term at least three times longer than that provided for repeat offenders generally, up to a maximum term of life imprisonment, and there would be no eligibility for parole before a prescribed minimum sentence of at least three years had been served. In view of these enhanced penalties, defendant Nieves moves pursuant to Fed.R.Crim.P. 12 to dismiss the second, or “schoolhouse,” count upon the grounds that section 845a violates the due process and equal protection guarantees of the Fifth Amendment to the Constitution. Defendant Pagan joins in the motion.

DUE PROCESS OF LAW

The defendant claims that section 845a establishes an irrebuttable presumption that all narcotics sales within one thousand feet of school property have a special detrimental effect upon schoolchildren, an effect the statute was specifically designed to prevent, and thus are punishable by enhanced penalties. However, he argues, since the transaction alleged under Count Two occurred at four p.m. two blocks away from school property and the complaint and discovery materials provided by the Government make no reference to the presence of any school-age children during the transaction, the presumption is wholly irrational in the context of this case and to subject defendant to enhanced penalties should he be convicted would not serve the purpose of the statute. Nieves concludes that because he is not permitted to offer evidence that his alleged sale of heroin had no effect upon children, thereby rebutting the presumption and avoiding the enhanced penalties, section 845a may deprive him of his liberty without due process of law if he is convicted and sentenced under Count Two.

The premise of defendant’s due process claim, that the irrebuttable presumption established by section 845a is not rationally related to a legitimate governmental interest in the context of this case, is without merit. Defendant does not dispute the legitimacy of the congressional purpose behind section 845a, namely, to protect school-age children from the dangers posed by the sale of narcotics, or that the relationship between this purpose and the challenged presumption need be anything more than rational. Yet under this liberal standard, section 845a clearly satisfies the requirements of due process. Indeed, the nature of the governmental interest involved here and the likely impact of the presumption and enhanced penalties upon prospective drug sellers suggest that the statute could withstand scrutiny under a more stringent standard. The irrebuttable presumption established by section 845a is easily distinguishable from those held invalid on due process grounds in cases such as Cleveland Board of Education v. LaFleur, United States Department of Agriculture v. Murry, and Stanley v. Illinois. The presumption that narcotics sales in the vicinity of an elementary or secondary school endanger the students and thus should be subject to stiffer penalties is substantially related to Congress’s interest in shielding these children from the evils of the drug trade. Whether or not a child is involved in or otherwise present during any particular sale of narcotics within one thousand feet of a school, subjecting the seller to enhanced penalties reasonably may be expected to deter the seller and other illicit dealers from conducting their operations near school property in the future. In such areas, where children congregate in large numbers before, during, and after school sessions, they are readily subject to the illicit activities of those who ply narcotics to the victims of drug abuse and addiction. The sale and distribution of drugs to youngsters for their use may subject them to the evils of addiction, a hazard to them not only physically and psychologically but financially, with the prospect that their need for drugs, once they are addicted, will lead them into a life of crime to obtain funds to support their habit. They may be drawn into drug rings as participants themselves, aiding the sale and distribution of narcotics to others, including their schoolmates. Indeed, judicial notice may be taken of the destructive results of drug addiction, the source of which Congress clearly intended to keep out of the easy reach of school-age children. It is difficult to imagine a more rational way of keeping drug traffickers out of areas where children are more likely to come into contact with them than to subject them to a risk of stiffer penalties for doing business near school property. By focusing on the particular transaction for which he is charged, defendant fails to consider the long term effect of section 845a on the health and welfare of schoolchildren in general.

EQUAL PROTECTION OF THE LAWS

Defendant further asserts that section 845a denies him the equal protection of the laws guaranteed by the Fifth Amendment because the statute’s enhanced penalties have a greater impact upon drug traffickers who reside in inner city areas, where population density and the number of schools are higher, than upon those who reside elsewhere. Defendant proceeds on the assumption that, because members of racial minority groups represent a higher percentage of the population in these areas than in suburban and rural areas, section 845a has a disproportionate impact upon a “suspect class.” As a result, he argues, the statute is subject to strict scrutiny under the equal protection guarantee, in which case it must be invalidated as impermissibly overbroad in view of the governmental interest it is intended to advance.

Even assuming for purposes of this motion that section 845a has a racially disparate impact — defendant offers no evidence, statistical or otherwise, to support his assumption that the statute’s enhanced penalties burden one race more than another— that fact alone would not give rise to an equal protection claim. More than a disparate impact has to be shown. Under the rule of Washington v. Davis,

a law, neutral on its face and serving ends otherwise within the power of government to pursue, is [not] invalid under the Equal Protection Clause simply because it may affect a greater proportion of one race than of another. Disproportionate impact is not irrelevant, but it is not the sole touchstone of an invidious racial discrimination forbidden by the Constitution. Standing alone, it does not trigger the rule that racial classifications are to be subjected to the strictest scrutiny and are justifiable only by the weightiest of considerations.

It is now well established that “[p]roof of racially discriminatory intent or purpose is required to show a violation of the Equal Protection Clause,” and that “the absence of proof of discriminatory intent forecloses any claim that the official action challenged in this case violates the Equal Protection Clause.” Defendant offers no evidence that the alleged disproportionate impact of 845a upon racial minority groups reflects any discriminatory purpose on the part of Congress or the law enforcement officials charged with administering the statute. Indeed, he concedes there was no intent to discriminate on the part of Congress in enacting section 845a. It is sufficient for equal protection purposes that the statute, as already noted, bears a rational relationship to a legitimate governmental interest.

Defendant argues, however, that the rule of Washington v. Davis does not apply in this case because the alleged disparate impact burdens not only a suspect class but affects what he calls “the purity of the criminal justice system.” He attempts to distinguish Washington v. Davis upon the ground that the official conduct there in issue did not affect “the vital liberty interest present in the criminal justice area.” Where, as here, both a suspect class and a liberty interest are burdened by the discriminatory effect of an otherwise valid statute, he asserts, these protected interests in combination are too important to require a showing of discriminatory intent before subjecting the statute to strict scrutiny under the equal protection guarantee.

In effect, defendant urges the Court to adopt a rule that, Washington v. Davis notwithstanding, racially disparate impact alone does give rise to an equal protection claim whenever that impact takes the form of a criminal sanction involving imprisonment. Under this rule, any criminal law designed to serve neutral ends nevertheless would be invalid, absent compelling justification, if in practice it burdened one race more than another. Whether or not such a rule would be desirable, it surely “would be far reaching and would raise serious questions about, and perhaps invalidate, a whole range of [criminal laws] that may be more burdensome” to the average minority group member than to others. In Washington v. Davis, the Supreme Court expressed concern about setting in motion such sweeping changes in the system of civil laws, and there is no reason to believe that that concern is any less relevant with respect to the criminal justice system. Several Courts of Appeals have applied the rule of Washington v. Davis in criminal cases, requiring proof of discriminatory intent to show a violation of the Equal Protection Clause despite a claim that official conduct had a racially disparate impact upon a liberty interest. Indeed, in many of these cases the Courts of Appeals did so even though the conduct being challenged involved the imposition of the death penalty. Thus, defendant’s attempt to avoid the well established rule that proof of discriminatory intent is required to sustain an equal protection claim simply upon the ground that this is a criminal case is unsupported by reason or authority.

Accordingly, defendant’s motion to dismiss the schoolhouse count upon due process and equal protection grounds is denied.

So ordered.

      . 414 U.S. 632, 94 S.Ct. 791, 39 L.Ed.2d 52 (1974).

      . 413 U.S. 508, 93 S.Ct. 2832, 37 L.Ed.2d 767 (1973).

      . 405 U.S. 645, 92 S.Ct. 1208, 31 L.Ed.2d 551 (1972).

      . See 130 Cong.Rec. S559 (daily ed. Jan. 31, 1984) (remarks of Sen. Hawkins).

      . See Bolling v. Sharpe, 347 U.S. 497, 74 S.Ct. 693, 98 L.Ed. 884 (1954).

      . 426 U.S. 229, 96 S.Ct. 2040, 48 L.Ed.2d 597 (1976).

      . Id. at 242, 96 S.Ct. at 2049 (citation omitted).

      . Village of Arlington Heights v. Metropolitan Housing Dev. Corp., 429 U.S. 252, 265, 97 S.Ct. 555, 563, 50 L.Ed.2d 450 (1977).

      . City of Memphis v. Greene, 451 U.S. 100, 119, 101 S.Ct. 1584, 1596, 67 L.Ed.2d 769 (1981).

      . Defendant’s brief at 12.

      . See Woe v. Cuomo, 729 F.2d 96, 103-04 (2d Cir.), cert. denied, — U.S. -, 105 S.Ct. 339, 83 L.Ed.2d 274 (1984); Soberal-Perez v. Heckler, 717 F.2d 36, 42 (2d Cir.1983), cert. denied, — U.S. -, 104 S.Ct. 1713, 80 L.Ed.2d 186 (1984); see also Personnel Adm'r v. Feeney, 442 U.S. 256, 271-72, 99 S.Ct. 2282, 2292, 60 L.Ed.2d 870 (1979); Massachusetts Bd. of Retirement v. Murgia, 427 U.S. 307, 312, 96 S.Ct. 2562, 2566, 49 L.Ed.2d 520 (1976) (per curiam).

      . Washington, 426 U.S. at 248, 96 S.Ct. at 2051.

      . See Shaw v. Martin, 733 F.2d 304, 311-14 (4th Cir.), cert. denied, - U.S. -, 105 S.Ct. 230, 83 L.Ed.2d 159 (1984); Adams v. Wainwright, 709 F.2d 1443, 1449-50 (11th Cir.1983), cert. denied, — U.S. -, 104 S.Ct. 745, 79 L.Ed.2d 203 (1984); Harris v. Pulley, 692 F.2d 1189, 1198-99 (9th Cir.1982), rev'd on other grounds, 465 U.S. 37, 104 S.Ct. 871, 79 L.Ed.2d 29 (1984); Smith v. Balkcom, 660 F.2d 573, 585 (5th Cir.1981), modified, 671 F.2d 858 (5th Cir.), cert. denied, 459 U.S. 882, 103 S.Ct. 181, 74 L.Ed.2d 148 (1982); see also Inmates of the Nebraska Penal & Correctional Complex v. Greenholtz, 567 F.2d 1368, 1374-75, 1380 (8th Cir.1977) (discretionary parole allegedly denied on racial and ethnic grounds), cert. denied, 439 U.S. 841, 99 S.Ct. 132, 58 L.Ed.2d 140 (1978).


author: BROTMAN, District Judge.

text:
    William SHOEMAKER, Angel Cordero, Jr., William Herbert McCauley, Philip Grove and Vincent Bracciole, Plaintiffs, v. Hal HANDEL, Executive Director of the New Jersey Racing Commission, Samuel A. Boulmetis, Steward Representing NJ Racing Commission, Joseph F. Piarulli, Associate Steward, Carl H. Hanford, Associate Steward and Richard W. Lawrenson, Associate Steward, Defendants.
    Civ. A. No. 85-1770.
    United States District Court, D. New Jersey.
    May 13, 1985.

      William L. Bowe, Bowe & Rakinic, Woodbury, N.J., for plaintiffs.
    Irwin I. Kimmelman, Atty. Gen. of N.J. by Steven Wallach, Deputy Atty. Gen., Div. of Law, Richard J. Hughes, Justice Complex, Trenton, N.J., for defendants.
   BROTMAN, District Judge.

Plaintiffs, William Shoemaker, Angel Cordero, Jr., William Herbert McCauley, Philip Grove, and Vincent Bracciole bring this action under 42 U.S.C. § 1983, seeking a preliminary injunction against defendants Hal Handel, Samuel A. Boulmetis, Joseph A. Piarulli, Carl H. Hanford, and Richard W. Lawrenson, to restrain the enforcement of New Jersey Racing Commission Regulations N.J.A.C. 13-.70-14A.10 and 13:70-14A.11, which provide for breathalyzer and urine tests for licensed jockeys.

This matter having come before the court on April 24, 1985, and the court, having considered the submissions and arguments of the parties, makes the following findings of fact and conclusions of law.

I. FINDINGS OF FACT

1. Plaintiffs William Shoemaker, Angel Cordero, Jr., William Herbert McCauley, Philip Grove, and Vincent Bracciole are licensed jockeys of the State of New Jersey who have ridden and intend to continue to ride in thoroughbred horse races in the State of New Jersey.

2. Defendant Hal Handel is the Executive Director of the New Jersey Racing Commission (“Racing Commission”), Trenton, New Jersey.

3. Defendant Samuel A. Boulmetis is the Steward representing the Racing Commission at the race meeting held at the Garden State Park, Cherry Hill, New Jersey.

4. Defendants Joseph A. Piarulli, Carl H. Hanford, and Richard W. Lawrenson are Associate Stewards representing the Racing Commission at the race meeting held at the Garden State Park, Cherry Hill, New Jersey.

5. The New Jersey State Legislature has established a New Jersey Racing Commission, vested with the broad “powers necessary or proper to enable it to carry out fully and effectually all the provisions and purposes of this act,” including jurisdiction over “any and all persons, partnerships, associations or corporations which shall hereafter hold or conduct any meeting within the State of New Jersey whereat horse racing shall be permitted for any stake, purse, or reward.” N.J.S.A. 5:5-22.

6. The Racing Commission promulgated N.J.A.C. 13:70-14A.10 and 14A.11 (attached hereto as Appendix A), pursuant to its authority granted by N.J.S.A. 5:5-30. These regulations permit the use of breathalyzer and urine tests to detect the presence of alcohol or controlled dangerous substances as defined in N.J.S.A. 24:21-1 et seq. They were proposed on June 18, 1984, 16 N.J.R. 1457(a), adopted on January 14, 1985, 17 N.J.R. 470, effective on February 19, 1985, and operational on April 1, 1985.

7. N.J.A.C. 13:70-14A.10 provides that a State Steward may direct officials, jockeys, trainers and grooms to submit to a breathalyzer test. If the result of that test shows a reading of .05 percent of alcohol in the blood, “such person shall not be permitted to continue his duties.” The Steward “may fine or suspend any participant who records a blood alcohol reading of .05 percent or more.” Second or repeat offenders “shall be subject to expulsion, or such penalty as the stewards may deem appropriate.”

8. N.J.A.C. 13:70-14A.11 provides, inter alia, that '“[ejvery jockey for any race at any licensed racetrack may be subjected to a post-race urine test, or other non-invasive fluid test at the direction of the State Steward in a manner prescribed by the New Jersey Racing Commission. Any jockey who fails to submit to a urine test when requested to do so by the State Steward shall be liable to the penalties provided in N.J.A.C. 13:70-31.” N.J.A.C. 13:70-14A.11(b). The regulation further provides that a “positive” drug test result be reported in writing to the Executive Director of the Racing Commission or his designee. N.J.A.C. 13:70-14A.11(d).

9. N.J.A.C. 13:70-14A.11 also provides that “[t]he results of any urine test shall be treated as confidential, except for their use with respect to a ruling issued pursuant to this rule, or any administrative or judicial hearing with regard to such a ruling. Access to the reports of any ‘positive’ results shall be limited to the Commissioners of the New Jersey Racing Commission, the Executive Director and/or his designee and the subject jockey, except in the instance of a contested matter.” N.J.A.C. 13:70-14A.11(e).

10. N.J.A.C. 13:70-14A.11 also provides that “[n]o jockey shall use any Controlled Dangerous Substance as defined in the ‘New Jersey Controlled Dangerous Substance Act,’ N.J.S.A. 24:21-1, et seq. or any prescription legend drug, unless such substance was obtained directly, or pursuant to a valid prescription or order from a licensed physician, while acting in the course of his professional practice. It shall be the responsibility of the jockey to give prior notice to the State Steward that he is using a Controlled Dangerous Substance or prescription legend drug pursuant to a valid prescription or order from a licensed practitioner.” N.J.A.C. 13:70-14A.11(a).

11. On April 1, 1985, a meeting was held in the jockey’s room at the Garden State Park, Cherry Hill, New Jersey, among representatives of the Racing Commission, jockeys, and representatives of the National Jockeys Guild, the purpose of which was to explain the new regulations.

12. The Jockeys Guild requested that the Racing Commission defer implementation of these regulations until a court challenge to their validity could be mustered. The Racing Commission declined to defer enforcement.

13. Defendants have forced or threatened to force plaintiffs to undergo breathalyzer and/or urine testing pursuant to N.J. A.C. 13:70-14A.10 and 14A.11.

14. Defendants have forced or threatened to force plaintiffs to fill out certain forms requiring the disclosure of personal medical data and other information pursuant to N.J.A.C. 13:70-14A.11(a).

II. CONCLUSIONS OF LAW

1. The following Conclusions of Law, insofar as they may be considered Findings of Fact, are so found by this court to be true in all respects.

2. Jurisdiction is conferred upon this court by 28 U.S.C. §§ 1331 and 1343, this being a suit under 42 U.S.C. § 1983, which provides, in pertinent part, that:

Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State ... subjects, or causes to be subjected, any citizen of the United States ... to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.

3. In order to support the entry of a preliminary injunction under Federal Rule of Civil Procedure 65(b), the applicant must make a showing as to the following four factors:

(a) the significance of the threat of irreparable harm to plaintiffs if the injunction is not granted;
(b) the state of the balance between this harm and the injury that granting the injunction would inflict upon the defendant;
(c) the probability that plaintiff will prevail on the merits; and
(d) the public interest will be served.

The court must balance these factors. In re Arthur Treacher’s Franchisee Litigation, 689 F.2d 1137, 1143 (3rd Cir.1982); Continental Group, Inc. v. Amoco Insurance Company, 614 F.2d 351 (3rd Cir.1980); Rennie v. Klein, 462 F.Supp. 1131, 1142 (D.N.J.1978).

4. A petition for a preliminary injunction is addressed to the sound discretion of the trial court, Evening News Publishing Company v. Allied Newspaper Carriers of New Jersey, 149 F.Supp. 460, 462 (D.N.J.1957), and such relief should be granted only when it is necessary to preserve the status quo during the pendency of an action so as to avoid irreparable harm.

5. Plaintiffs allege that N.J.A.C. 13:70-14A.10 and 14A.11 violate their rights guaranteed by the Fourth, Fifth, and Ninth Amendments and the Due Process and Equal Protection Clauses of the Fourteenth Amendment to the United States Constitution. Specifically, plaintiffs argue that defendants:

(a) subject jockeys to unreasonable searches and seizures;
(b) require the disclosure of private medical information, potentially relevant to violations of the criminal law of the State of New Jersey, without adequate safeguards for maintaining its confidentiality;
(c) fail to provide a hearing during which plaintiffs can challenge the results of the breathalyzer and urine tests; and
(d) discriminate against jockeys as a group by singling them out for breathalyzer and urine testing.

The court will address the strength of the plaintiffs’ claims seriatim.

6. The Search and Seizure Claim. The Fourth Amendment provides that “[t]he right of the people to be secure in their persons ... against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.” The essential purpose of the proscriptions in the Fourth Amendment is to “impose a standard of ‘reasonableness’ upon the exercise of discretion by government officials,” including law enforcement agents and state regulatory personnel, in order to “safeguard the privacy and security of individuals against arbitrary intrusions____” Delaware v. Prouse, 440 U.S. 648, 99 S.Ct. 1391, 59 L.Ed.2d 660 (1979); Marshall v. Barlow’s Inc., 436 U.S. 307, 312, 98 S.Ct. 1816, 1820, 56 L.Ed.2d 305 (1978); Camara v. Municipal Court, 387 U.S. 523, 528, 87 S.Ct. 1727, 1730, 18 L.Ed.2d 930 (1967). Thus, the Fourth Amendment protects individuals from “unreasonable government intrusions into their legitimate expectations of privacy.” United States v. Chadwick, 433 U.S. 1, 7, 97 S.Ct. 2476, 2481, 53 L.Ed.2d 538 (1977).

Except in certain carefully limited classes of cases, a search of private property or person without consent is “unreasonable” unless it has been authorized by a valid search warrant. See Marshall, supra. An exception to the search warrant' requirement has been recognized for “pervasively regulated businesses” and for “closely related” industries “long subject to close supervision and regulation.” Id.; United States v. Biswell, 406 U.S. 311, 316, 92 S.Ct. 1593, 1596, 32 L.Ed.2d 87 (1972); Colonnade Catering Corp. v. United States, 397 U.S. 72, 77, 90 S.Ct. 774, 777, 25 L.Ed.2d 60 (1970). These cases are indeed exceptions,

but they represent responses to relatively unique circumstances. Certain industries have such a history of government oversight that no reasonable expectation of privacy * * * could exist for a proprietor over the stock of such an enterprise. Liquor (Colonnade) and firearms (Bis-well) are industries of this type; when an entrepreneur embarks upon such a business, he has voluntarily chosen to subject himself to a full arsenal of governmental regulation.
Industries such as these fall within “certain carefully defined classes of cases,” referenced in Camara, 387 U.S., at 528, 87 S. Ct., at 1731. The element that distinguishes these enterprises from ordinary businesses is a long tradition of close government supervision, of which any person who chooses to enter such a business must already be aware ... businessmen engaged in such federally licensed and regulated enterprises accept the burdens as well as the benefits of their trade ... The businessman in a regulated industry in effect consents to the restrictions placed upon him.

Marshall, supra 436 U.S. at 313, 98 S.Ct. at 1821.

Horse racing meets both exceptions to the search warrant requirement articulated above. This industry has been subject to “pervasive and long standing regulation by New Jersey.” State v. Dolce, 178 N.J.Super. 275, 283-85, 428 A.2d 947 (App.Div.1981) (emphasis added).

The State has had and continues to have a vital interest in the horse racing industry, particularly with respect to maintaining its integrity. Jersey Downs, Inc. v. New Jersey Racing Commission, 102 N.J.Super. 451, 457 [246 A.2d 146] (App. Div.1968). Consequently, our legislature has established the Racing Commission and vested in it the power and duty to govern all aspects of horse racing in this State, including all those working in the industry. N.J.S.A. 5:5-22. To this end, the Racing Commission was granted broad rule-making powers to protect the state’s interest in the industry and to carry out its statutory mandate. N.J.S.A. 5:5-30.

Dolce, supra at 284-85, 428 A.2d 947; see also Biswell, supra 406 U.S. at 316, 92 S.Ct. at 1596 (firearms); Colonnade, supra 397 U.S. at 77, 90 S.Ct. at 777 (liquor); In re Martin, 90 N.J. 295, 313, 447 A.2d 1290 (1982) (casino gambling); State v. Williams, 84 N.J. 217, 223-25, 417 A.2d 1046 (1980) (liquor); Jersey Downs, Inc., supra 102 N.J.Super. at 457, 246 A.2d 146 (horse racing); Niglio v. New Jersey Racing Commission, 158 N.J.Super. 182, 188, 385 A.2d 925 (App.Div.1978) (horse racing).

While horse racing comes within the recognized exception to the administrative search warrant rule, the court must still address whether the state’s regulations which provide for the use and administration of breathalyzer tests and urinalyses meet the “reasonableness” test of the Fourth Amendment. As the Supreme Court has noted,

[Reasonableness] is not capable of precise definition or mechanical application. In each case it requires a balancing of the need for the particular search against the invasion of personal rights that the search entails. Courts must consider the scope of the particular intrusion, the manner in which it is conducted, the justification for initiating it, and the place in which it is conducted.

Bell v. Wolfish, 441 U.S. 520, 559, 99 S.Ct. 1861, 1884, 60 L.Ed.2d 447 (1979); Illinois v. Lafayette, 462 U.S. 640, 103 S.Ct. 2605, 77 L.Ed.2d 65 (1983). See also Schmerber v. California, 384 U.S. 757, 86 S.Ct. 1826, 16 L.Ed.2d 908 (1966) (Court must balance the interest in human dignity and privacy against the reasonableness of the test and the reasonableness of the manner in which the test is conducted); Rochin v. California, 342 U.S. 165, 72 S.Ct. 205, 96 L.Ed. 183 (1952) (Due process of law precludes defining, and therefore confining, these standards of conduct more precisely than to say that convictions cannot be brought about by methods that offend “a sense of justice”). The courts have used this standard to differentiate between levels and degrees of intrusiveness among searches and seizures. As measured by the degree of invasion, inspections of personal effects are generally least intrusive, while breaches of the “integrity of the body” result in the greatest invasion of privacy. The court, of course, must also consider an individual’s reasonable expectations of privacy under the circumstances. In other words, the court must balance the competing interests involved on a case-by-case basis.

Plaintiffs rely heavily on a recent Second Circuit case in arguing that the New Jersey Racing Commission’s drug and alcohol testing program is unconstitutional. See Security and Law Enforcement Employees, District Council 82 v. Carey, 737 F.2d 187 (2nd Cir.1984). In Security and Law Enforcement Employees, the state adopted a system of random “strip searches” and “visual body cavity searches” of state correctional officers in an effort to reduce the smuggling of contraband into state penal institutions. The court recognized the uniqueness of the correctional institutions involved, the deference traditionally afforded prison administrators by the courts, the legitimate government interest in the maintenance of stability, security, and order in its correctional facilities, and a corrections officer’s diminished expectations of privacy while at work in the penal institution. Nevertheless, the court also recognized the uniquely intrusive nature of a strip search and visual body cavity search, and, despite the significant government interests involved, held that such searches required the presence of “reasonable suspicion” of wrongdoing prior to their utilization. Id. at 203.

Likewise, the Ninth Circuit, in a series of cases within the special context of border searches under the Fourth Amendment, differentiated between strip and body cavity searches and less intrusive searches. Government agents could require one who crosses the border, without more, to submit the contents of his baggage for inspection. A simple pat down search requires a “minimal showing of suspicion.” A strip search requires “real suspicion,” and a body cavity search and/or x-ray examination can be conducted only in the presence of a “clear indication that the suspect is carrying contraband in a body cavity.” United States v. Des Jardins, 747 F.2d 499, 504-05 (9th Cir.1984). See also United States v. Asbury, 586 F.2d 973, 975 (2nd Cir.1978) (To conduct a strip search at a border crossing, the government agent “should have a suspicion of illegal concealment that is based on something more than the border crossing____”).

The court finds that plaintiffs fail to demonstrate that the Racing Commission’s breathalyzer testing and urinalysis program is not closely tailored to further the state’s legitimate interest in reducing the use of alcoholic beverages and drugs, thereby promoting the safety and integrity of horse racing and protecting the public.

First, the regulations contested by plaintiffs were promulgated for the specific purpose of combatting and hopefully eliminating the perceived and actual use of alcohol and drugs which plagues this sport, as well as so many others. Use of drugs and alcohol by jockeys increases significantly the probability that serious injuries and death will occur during the race, as a result of single and multi-horse accidents. The state argues that the testing regimen previously used proved ineffective and failed to stop or reduce the use of these substances. As a result, the state has issued new regulations which may increase the likelihood of success and which provide for such testing at the direction of the State Steward when it appears most efficacious — at the track, proximate to race time. In this respect, the court notes that “substantially identical regulations are in effect for the testing of harness drivers” in New Jersey. The harness breathalyzer rule has been in effect for several years. Harness drivers have been required to submit to random post-race urine tests since January 1985. Affidavit of John F. Higgins, Administrative Secretary of the Standard-bred Breeders and Owners Association of New Jersey, Inc., May 1, 1985, at ¶ 3. From June, 1982 to the present, 385 tests have been conducted on harness drivers on a random basis, using the Enzyme Multiplied Immunoassay Technique System of analysis. Thirty-five of these tests, more than eight percent, proved positive. Readings ranged from marijuana to heroin use. Affidavit of Charles F. Bradley, Assistant Director of the New Jersey Racing Commission, May 6, 1985, at ¶¶ 3, 4.

Second, these tests as applied to jockeys are not unique. Boxing is also a heavily regulated industry in New Jersey, with boxers being subject to stringent regulations and testing as to their physical fitness to compete. All boxers must undergo physical examinations on the day of the bout “both at weigh in and in the evening, a short while before the boxing program commences.” These tests include blood samples, and “[i]n all cases ... a thorough ophthalmological and neurological examination and a urinalysis.” N.J.A.C. 13:46-12.-2(a). A boxer may be disqualified for any medical reason. N.J.A.C. 13:46-12.2(b). The boxer “must submit to any prefight or postfight urinalysis or other laboratory procedure ordered by the physician appointed by the Commissioner to detect the presence of any drug. Refusal to submit to such testing shall result in the immediate disqualification of the boxer from the match and an indefinite suspension from boxing.” N.J.A.C. 13:46-12.3.

Third, while the Supreme Court has refrained from drawing bright lines among searches, breathalyzer tests and urinalyses are considered less intrusive than body cavity and strip searches and those searches which have been identified as intruding upon the “integrity of the body,” see Schmerber, supra; United States v. Ramsey, 431 U.S. 606, 618 n. 13, 97 S.Ct. 1972, 1979 n. 13, 52 L.Ed.2d 617 (1977); Des Jardins, supra; and therefore, (1) are distinguishable from Security and Law Enforcement Employees, supra, on the facts and (2) fully consistent with the logic of Des Jardins ’ heirarchy of suspicion. While breathalyzer and urine tests require the individual involved to “give up” something, the intrusion is less than the involuntary securing of a blood sample or other searches into which an intrusion into the body is required.

Fourth, jockeys have diminished expectations of privacy as to these job related searches and seizures. The jockeys admit to the pervasive historical regulation of their industry:

Jockeys, like other athletes have always been subject to medical examinations or testing where they exhibited some physical symptomatology indicating a potential problem with their riding performance.

Plaintiffs’ Brief at 16-17. The state’s regulations go one step further by permitting the random examination of jockeys at the direction of the Steward. Jockeys are licensed by the State to race in New Jersey, subject to the extensive and detailed conditions and regulations in effect. By securing their licensure, jockeys accept the unique benefits as well as the burdens of their trade. They have notice that the state has regulations which concern aspects of their physical and mental fitness to ride. This includes alcohol and drug use which impedes their riding performance. The state has a legitimate interest in ensuring the health and safety of all participants and in preserving the integrity of the gambling industry as a whole. See Dolce, supra (horse racing); Jersey Downs, supra (horse racing); Niglio, supra (horse racing); Martin, supra (casino gambling). See also Biswell, supra (If firearms inspection is to serve as an effective deterrent, “unannounced, even frequent inspections are essential”); Colonnade, supra (Congress has broad authority over the liquor industry to fashion standards of reasonableness over searches and seizures). Cf. Prouse, supra (Automobile operators do not lose all expectations of privacy because automobile use is subject to government regulation. “Auto travel is a basic, pervasive and often necessary mode of transportation to and from one’s home, workplace, and leisure activities ... ”). By adopting these regulations the state has embarked upon a unique regulatory program, rehabilitative rather than penal in nature.

The court is reluctant, without a greater showing by plaintiffs, to enjoin part of an extensive state regulatory scheme, especially when such action may be perceived by the public as undermining the ability of the Racing Commission to adequately police this industry or the public’s confidence in the Racing Commission’s ability to do its job. The court finds that, at this point, plaintiffs have failed to meet their burden to demonstrate a probability of success on the merits, that plaintiffs will suffer any irreparable harm as a result of continued testing during the duration of this litigation, and that the public interest in the integrity and safety of thoroughbred racing will be served by an injunction. Therefore, the court denies plaintiffs’ motion for a preliminary injunction preventing the enforcement of N.J.A.C. 13:70-14A.10 and 13:70-14A.11.

7. The Privacy Claim. The state forbids plaintiffs from using any Controlled Dangerous Substances, as defined by N.J. S.A. 24:21-1 et seq., or prescription legend drugs, unless obtained directly or pursuant to a valid prescription or order from a licensed physician. Plaintiffs must give the State Steward notice of such use. N.J. A.C. 13:70-14A.11(a). Plaintiffs must fill out a form (see Appendix B attached hereto), which asks for the names of prescribed medications, the names of the persons who prescribed them, what each prescription treats, and the date and time of the last dosage of each medication taken. The form also requires that plaintiffs provide the names of over-the-counter medications used, what these medications treat, and the date and time of the last dosage. Plaintiffs argue that the regulation (1) forces jockeys to divulge private, personal medical information without sufficient justification, (2) forces jockeys to divulge information which could incriminate them under the laws of New Jersey, and (3) fails to provide adequate provisions and safeguards to prevent the disclosure of such information to the public and members of their profession.

While the constitution does not explicitly state that there is a right to privacy, a constitutional doctrine has been established and expanded “variously described as recognizing a right to privacy.” McKenna v. Fargo, 451 F.Supp. 1355 (1978); see Carey v. Population Services Int’l, 431 U.S. 678, 684-86, 97 S.Ct. 2010, 2015-16, 52 L.Ed.2d 675 (1977); Whalen v. Roe, 429 U.S. 589, 97 S.Ct. 869, 51 L.Ed.2d 64 (1977). There is a privacy interest in avoiding disclosure to government agents of personal medical information. Whalen, supra at 608-09, 97 S.Ct. at 881. However, this privacy interest is not absolute and must be balanced against the legitimate interests of the state in securing such information. The regulations must be narrowly tailored to “express only those compelling state interests.” McKenna, supra at 1381; Dolce, supra. The extent of the plaintiffs’ privacy interests must be judged in light of the statutory safeguards against disclosure. Whelan, supra; Lehrhaupt v. Flynn, 140 N.J.Super. 250, 260-63, 356 A.2d 35 (App.Div.1976), aff'd, 75 N.J. 459, 383 A.2d 428 (1978). The state must use the narrowest means consistent with the maintenance of its legitimate interests. Martin, supra; Lehrhaupt, supra at 262, 264, 356 A.2d 35; Kenny v. Byrne, 144 N.J.Super. 243, 253, 365 A.2d 211 (App.Div.1976), aff'd, 75 N.J. 458, 383 A.2d 428 (1978).

In Whalen, the Supreme Court held that disclosure of an individual’s name, age, address, and use of a certain drug did not (1) unduly burden his privacy interest nor (2) differ significantly from the disclosures of private medical information requested by insurance companies and hospital personnel. Whalen, supra 429 U.S. at 608, 97 S.Ct. at 881. In Martin, the New Jersey Superior Court upheld the use of a casino license form pursuant to the Casino Control Act, holding that none of the challenged questions were “so personal” as to permit the assertion of a right of selective disclosure. The questions on the casino license form concerned “predominantly information of public record.” Martin, supra, 90 N.J. at 321-22, 447 A.2d 1290. In McKenna, the United States District Court for the District of New Jersey found that the degree and character of the required medical disclosure was “far greater and more intrusive” than in Whalen. McKenna, supra at 1381. The Jersey City Fire Department required a thorough psychological examination as a prerequisite to employment. The court found that:

The evaluation looks deeply into an applicant’s personality, much as a clinical psychologist would if requested to do so by an applicant. Fire-fighter candidates are called upon to reveal the essence of their experiences of life, the collective stream of thoughts and feelings that arise from the ongoing dialogue which individuals carry on between the world and themselves in the privacy of their being.

Id. However, the court found the state’s interest in the medical disclosure sufficiently compelling to override the applicant’s privacy interests:

The life of a community, as well, depends, at the most basic level, on those whose job it is to protect the community from physical forces, like fire, that have escaped from the control that makes them productive. Property, and the security of the community, as well as lives, are at stake in improving the fire department. The state interest is compelling, indeed ... and is served by the challenged evaluation and hiring procedure.

Id. at 1381.

The state’s disclosure form, by asking jockeys to provide the nature of the illness requiring treatment by prescription drug, is more intrusive than the disclosures discussed in Whalen and Martin, supra. For example, if a jockey takes anti-psychotic medications, he would be required to divulge, if applicable, that he suffers from certain mental illnesses or diseases. The court recognizes that the Racing Commission has a legitimate safety interest in preventing the use of Dangerous Controlled Substances by jockeys. The disclosure of certain medical information, and the forms utilized for that disclosure, furthers that stated purpose. The court does not find persuasive the state’s arguments that it has tailored the disclosure form so as to avoid unnecessarily intruding into private medical matters which are not germaine to the furtherance of the state’s articulated interests. These medical forms require jockeys to disclose within the sections marked “For Treatment Of” the illness or conditions for which a particular drug has been prescribed or used. The regulation is designed to prevent the illicit use of drugs and to aid in the proper detection of that use. The court questions whether such disclosure will further the state’s professed goals. In fact, such disclosure is not required on the face of the regulations issued by the Racing Commission. The state argues that the jockeys may, at their option, choose to leave the “For Treatment Of” sections blank when they complete these forms. Consistent with the state’s representations as to this aspect of the controversy, the court directs the Racing Commission to insert the word “optional” in the “For Treatment Of” sections of the disclosure form, thereby clearly indicating to jockeys that they may leave the objectionable sections empty.

Plaintiffs also argue that the regulations do not clearly safeguard against the disclosure of information obtained by the testing program or the medical forms. The regulations do provide that the results of urine tests shall be treated as confidential “except for their use with respect to a ruling issued pursuant to this rule.” Access to the results of “positive” urine tests “shall be limited to the Commissioners of the New Jersey Racing Commission, the Executive Director and/or his designee and the subject jockey, except in the instance of a contested matter.” N.J.A.C. 13:70-14A. 11(a) & (e) (emphasis added). The defendants have represented to this court that they wish to do everything possible to preserve the confidentiality of the medical information collected pursuant to the regulations. The Racing Commission will not share any data collected with any state agency charged with the enforcement of New Jersey’s criminal laws. Such information is gathered with “rehabilitative” and not “penal” purposes in mind.

Under the circumstances, plaintiffs have failed to persuade the court that they are likely to prevail on the merits of their privacy claims. Therefore, the court will deny plaintiffs’ motion for a preliminary injunction and will vacate the Temporary Restraining Order entered on April 24, 1985.

8. The Due Process Claim. Plaintiffs also allege that the regulations fail to provide a hearing at which plaintiffs can challenge the results of the breathalyzer and urine tests. The Racing Commission does provide a hearing, however, for jockeys wishing to challenge the results of the tests — at the jockeys’ request. Affidavit of Bruce H. Garland, ¶ 9.

9. The Equal Protection Claim. Plaintiffs also allege that the regulations discriminate against jockeys by singling them out as a group for breathalyzer and urine testing, without a rational basis or compelling interest to do so. The state has a legitimate safety interest in testing the jockeys in order to reduce the possibility of accidents and even death while racing.

10. Conclusion. In summary, the court denies plaintiffs’ motion for a preliminary injunction in its entirety. The court orders defendants to insert the word “optional” in the “For Treatment Of” sections of the medical disclosure form. The court will hear this matter on an expedited basis according to the following schedule: parties will attend a Scheduling Conference with United States Magistrate Jerome B. Simandle on May 20,1985, at 3:00 p.m.; the Joint Final Pre-Trial Order will be entered on June 7, 1985; the court will schedule a full hearing for June 18, 1985 at 9:30 a.m. An appropriate order will be entered.

APPENDIX A

(a)

NEW JERSEY RACING COMMISSION

Thoroughbred Rules:

Breathalyzer Test; Urine Test

Adopted New Rules: N.J.A.C. 13:70-14A.10 and 14A.11 (proposed as 13:70-14A.13 and 14A.15)

Proposed: June 18, 1984 at 16 N.J.R. 1457(a).

Adopted: January 14, 1985 by New Jersey Racing Commission, Harold G. Handel, Executive Director.

Filed: January 28, 1985 as R.1985 d.57, without change.

Authority: N.J.S.A. 5:5-30.

Effective Date: February 19, 1985.

Operative Date: April 1, 1985.

Expiration Date pursuant to Executive Order No. 66 (1978): February 19, 1990.

Summary of Public Comments and Agency Responses: No comments received.

Full test of the adoption follows.

13:70-14A.10 Breathalyzer test

Officials, jockeys, trainers and grooms shall, when directed by the State Steward, submit to a breathalyzer test and if the results thereof show a reading of more than .05 percent of alcohol in the blood, such person shall not be permitted to continue his duties. The stewards may fine or suspend any participant who records a blood alcohol reading of .05 percent or more. Any participant who records a reading above the prescribed level on more than one occasion shall be subject to expulsion, or such penalty as the stewards may deem appropriate.

13:70-14A.ll Urine test

(a) No jockey shall use any Controlled Dangerous Substance as defined in the “New Jersey Controlled Dangerous Substance Act”, N.J.S.A. 24:21-1, et seq. or any prescription legend drug, unless such substance was obtained directly, or pursuant to a valid prescription or order from a licensed physician, while acting in the course of his professional practice. It shall be the responsibility of the jockey to give prior notice to the State Steward that he is using a Controlled Dangerous Substance or prescription legend drug pursuant to a valid prescription or order from a licensed practitioner.

(b) Every jockey for any race at any licensed racetrack may be subjected to a post-race urine test, or other non-invasive fluid test at the direction of the State Steward in a manner prescribed by the New Jersey Racing Commission. Any jockey who fails to submit to a urine test when requested to do so by the State Steward shall be liable to the penalties provided in N.J.A.C. 13:70-31.

(c) Any jockey who is requested to submit to a post-race urine test shall provide the urine sample, without undue delay, to a Chemical Inspector of the Commission. The sample so taken shall be immediately sealed and tagged on the form provided by the Commission and the evidence of such sealing shall be indicated by the signature of the tested jockey. The portion of the form which is provided to the laboratory for analysis shall not identify the individual jockey by name. It shall be the obligation of the jockey to cooperate fully with the Chemical Inspector in obtaining any sample which may be required and to witness the securing of such sample.

(d) A “positive” Controlled Dangerous Substance or prescription drug result shall be reported, in writing, to the Executive Director or his designee. On receiving written notice from the official chemist that a specimen has been found “positive” for controlled dangerous substance, or prescription legend drug, the Executive Director or his designee shall proceeds follows:

1. He shall, as quickly as possible, notify the jockey involved, in writing;

2. For a jockey’s first violation, he shall issue a written reprimand and warning and notify the jockey that he will be subject to mandatory drug testing and that any further violation shall result in the sanctions described in paragraphs (3) and (4) below;

3. For a jockey’s second violation, he shall require the jockey to enroll in a Supervisory Treatment Program approved by the New Jersey Racing Commission upon such reasonable terms and conditions as he may require. The jockey shall be permitted to participate unless his continued participation shall be deemed, by the Executive Director of his designee, to be detrimental to the best interests of racing. It shall be the jockey’s responsibility to provide the Commission with written notice of his enrollment, weekly status reports, and written notice that he has successfully completed the program and has been discharged. If a jockey fails to comply with these requirements, he shall be liable to the penalties provided in N.J.A.C. 13:70-31.

4. For a jockey’s third or subsequent violation, he shall be liable to the penalties provided in Subchapter 31 and may only enroll into a Supervisory Treatment Program in lieu of said penalties, with the approval of the New Jersey Racing Commission.

(e) The results of any urine test shall be treated as confidential, except for their use with respect to a ruling issued pursuant to this rule, or any administrative or judicial hearing with regard to such a ruling. Access to the reports of any “positive” results shall be limited to the Commissioners of the New Jersey Racing Commission, the Executive Director and/or his designee and the subject jockey, except in the instance of a contested matter.

APPENDIX B

      . The court defined “strip searches” as “inspections of the naked body of the person searched," and “visual body cavity searches" as "visual inspections of the anal and genital areas.”

      . Despite the intrusion, the Supreme Court has upheld the involuntary taking of a blood sample under certain circumstances. See, e.g., Schmerber, supra (physician acting under police direction can take a blood sample from an objecting defendant where delay in obtaining a search warrant threatened to destroy the evidence); Breithaupt v. Abram, 352 U.S. 432, 77 S.Ct. 408, 1 L.Ed.2d 448 (1957) (blood sample taken from an unconscious person permitted because the "interests of society in the scientific determination of intoxication, one of the great causes of the mortal hazards of the road” outweighed "so slight an intrusion into the body.")

      . The court believes that the Racing Commission can take affirmative, immediate measures to clarify any ambiguities which may exist. The Commission's regulations should contain provisions governing the storage of and access to the information collected, the length of time data will be kept, and the precautions utilized to safeguard the information from disclosure. Should defendants fail to take measures to remedy existing ambiguities from the regulations, the court reserves its right to reconsider injunctive relief.