Top court to hear case challenging ACS’ cut of speed-camera revenue

Maryland’s top court has agreed to decide whether motorists can challenge Montgomery County’s speed-camera system, which is budgeted to bring in $10 million this fiscal year, on the grounds that it illegally gives the lead contractor a cut of the proceeds.

Eight motorists, all of whom have paid fines for speed-camera citations, contend that ACS State & Local Solutions Inc. gets $16.25 of every $40 fine paid under its contracts with the county and the City of Rockville. They claim that violates the Maryland Transportation Code provision, which bars speed-camera operators from collecting a “contingency fee” based on the amount of fines collected.

“This is not a global challenge to the very concept of speed cameras,” said Joshua Winger, an attorney for the motorists. “This is much more (about) ensuring that contracts entered into by the government are compliant with the statute that the government creates.”

Winger hopes to pursue a class action for damages and injunctive relief on behalf of all Maryland motorists who have paid a fine based on a citation generated by a speed camera operated by a private company whose compensation was contingency-based.

The motorists, so far, have run into judicial roadblocks.

Montgomery County Circuit Judge David A. Boynton dismissed their lawsuit in June 2010. The intermediate Court of Special Appeals affirmed the dismissal last October, saying that ACS does not “operate” the speed cameras and thus the statutory prohibition on collecting a contingency fee does not apply.

That court added the motorists had waived any legal challenge to the speed-cameras when they paid the $40 fine and that, in any event, all legal challenges to speed-camera citations must be raised in Maryland District Court.

Winger has appealed those rulings to the state’s highest appellate court, the Court of Appeals, saying they deprive litigants of their right to procedural due process.

Litigants often believe they have no real choice but to pay the fine in the first instance, as mounting a legal challenge would cost them more than the $40 fine with no assurance of ultimate victory, Winger said.

And District Courts are ill-suited to handle the complexity and volume of evidence required to wage a statutory challenge to speed cameras, Winger added.

“There is no practical way to do this in District Court,” said Winger, of Byrd & Byrd LLC in Bowie. “The District Court judge, with all due respect, is not going to have the time for a two-week trial. There is no means for discovery. There is no means to have a trial that long.”

But an attorney for Montgomery County and Rockville said Maryland’s transportation law states that challenges to speed camera citations must be brought in Maryland District Court. The law also provides that a payment of the fine is a concession of wrongdoing and a waiver of any legal challenge, said Charles L. Frederick, an associate Montgomery County attorney.

“The statute provides a mechanism whereby the person who receives a ticket can challenge the ticket” in district court, said Frederick, who urged the Court of Appeals in vain not to hear the case.

The motorists “tried to create a new remedy that wasn’t authorized by the legislature,” Frederick added. “Had they challenged it in the district court, there would be no need for the second case.”

Not the operator

The General Assembly authorized the use of speed cameras statewide in 2009, after approving their use in Montgomery County in 2006. The stated goal was to protect pedestrians in school zones and residential areas.

The law provided that any contractor that “operates” a speed-monitoring program on behalf of the county may not collect a fee “contingent on the number of citations issued or paid.”

Montgomery County selected ACS as the contractor in the spring of 2007.

The agreement called for ACS to construct and maintain the camera sites, provide for the camera data to be downloaded from the field to ACS’s processing center, perform name and address acquisition of vehicle owners, and provide the county with a preliminary decision on whether to issue a citation, according to papers Winger filed with the high court.

The agreement provided that ACS would be paid $16.25 per paid citation or $2,999 per month, whichever is greater, according to briefs filed in the case.

Montgomery County has budgeted for speed camera citations to bring in $9.8 million in fiscal 2012, which ends in June, according to county budget documents. Late fees are expected to bring in another $1.1 million.

The eight motorists filed the lawsuit May 2, 2008, challenging the legality of ACS receiving a cut of the paid fines. The complaint was amended in October 2009 to allege violations of due process, unjust enrichment, civil conspiracy and other claims for relief.

After the motorists filed suit, the county and Rockville amended their contracts with ACS to specify that the company “does not operate” the speed cameras; rather, the jurisdiction does.

But Winger said a change in contractual language does not alter the fact that ACS continues to perform the same functions.

The county and Rockville moved for dismissal of the lawsuit, which Boynton granted.

The case before the Court of Appeals is Baker et. al v. Montgomery County et al., No. 124 Sept. Term 2011. The court is expected to hear arguments in June.