Lutheran Church-Missouri Synod v. Federal Communications Commission

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

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Filed September 15, 1998

No. 97-1116

Lutheran Church-Missouri Synod,

Appellant

v.

Federal Communications Commission,

Appellee

Missouri State Conference of Branches

of the NAACP, et al.,

Intervenors

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On Petition for Rehearing

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Before: Silberman, Williams, and Sentelle, Circuit

Judges.

Opinion for the Court filed by Circuit Judge Silberman.

Silberman, Circuit Judge: The Federal Communications

Commission (FCC) and the government have filed a joint

petition for rehearing. Before the panel the government

appeared only as an amicus (with a somewhat different

position than the Commission). We do not, therefore, think

the government can be regarded as a party, so we treat the

petition as that of the Commission. The Commission offers

three arguments to support its contention that our opinion

unnecessarily and erroneously decided the Church's equal

protection claim: that we should have granted its motion to

remand without deciding the case; that if we had proceeded

we were obliged to decide the Religious Freedom Restoration

Act (RFRA) or free exercise claim before reaching the

Church's equal protection argument; and, finally, that we

should not have applied strict scrutiny as the standard by

which the Commission's Equal Employment Opportunity

(EEO) rules should be judged under the Equal Protection

Clause. We take up the arguments in that order.

1. The Remand Issue

We denied the FCC's motion to remand, presented seven

weeks after oral argument. Lutheran Church-Missouri

Synod v. FCC, 141 F.3d 344, 349 (D.C. Cir. 1998). The

motion was based on a "policy statement" in which the

Commission purported to overrule its prior King's Garden

decision. See Streamlining Broadcast EEO Rule and Poli-

cies, 13 F.C.C.R. 6322, 6323-24 (1998). That decision, it will

be recalled, permitted religious broadcasters to prefer em-

ployees of that religion only if the employees were involved

directly in broadcasting. See King's Garden, Inc., 38

F.C.C.2d 339 (1972), aff'd sub. nom. King's Garden, Inc. v.

FCC, 498 F.2d 51 (D.C. Cir. 1974).

The Church had attacked King's Garden as inconsistent

with both RFRA and the Free Exercise Clause, and the

Commission's counsel claimed that the majority of Commis-

sioners had agreed to apply that policy statement to this case

retroactively if we would remand. We rejected this "last

second" motion in part on grounds that a "policy statement,"

as Commissioner Furchtgott-Roth pointed out, does not bind

the Commission to a result in any particular case. See

Pacific Gas & Elec. Co. v. FPC, 506 F.2d 33, 38 (D.C. Cir.

1974). The Commission insists we misunderstood its action;

the policy statement was not "merely " a policy statement, it

was also an order that grew out of a rulemaking that did bind

the Commission. We confess that we simply have no idea as

to in what administrative law category the Commission policy

statement "order" falls. It could not be a rule because no

notice and comment procedure was employed, and we are

aware of no proposition of administrative law that allows the

assurances of individual Commissioners--even a majority--to

transform a prospective enforcement policy into a retroactive

rule of decision. In any event, the Commission concedes that

the statement did not itself apply to this case. Instead, the

Commission argues we should have remanded based on the

majority of Commissioners' expressed intent to apply the new

policy retroactively to this adjudicatory proceeding (notwith-

standing that a petition for reconsideration directed to the

policy statement has been filed before the Commission 1),

because we could thereby have avoided deciding a constitu-

tional question. We rather doubt that this court should ever

grant an agency's motion to remand after oral argument over

the opposition of a petitioner. The same consideration that

prevents the government from voluntarily acquiescing in a

panel decision and thereafter seeking vacatur while a petition

for reconsideration is pending seems applicable to such a

maneuver. See Mahoney v. Babbitt, 113 F.3d 219 (D.C. Cir.

1998). To be sure, as our colleague Judge Tatel points out,

we have previously granted an FCC motion to remand in a

case raising an equal protection challenge. See Steele v. FCC,

770 F.2d 1192 (D.C. Cir. 1985), vacated, Steele v. FCC, No.

84-1176 (D.C. Cir. Oct. 31, 1985) (en banc) (discussed in

Lamprecht v. FCC, 958 F.2d 382, 385 (D.C. Cir. 1992)). In

that case, however, the motion for remand was filed before

oral argument en banc (the panel opinion had been vacated)

__________

1 The Commission's attempt to characterize Commissioner

Furchtgott-Roth's concern as restricted to television stations is

disingenuous. The FCC cites his concurrence in the amended

policy statement as addressing only the nonbinding nature of the

policy with regard to television stations. It fails to mention,

however, the Rule 28(j) letter its own counsel filed with the court

noting that the Commissioner thought it inappropriate for the

motion to remand to bind the Commissioners to vote in a particular

way and thus wished to make no representations about what sort of

order should ultimately be adopted.

and, more important, the Commission's motion, which indicat-

ed that it doubted the constitutionality of its own policy, was

supported by the petitioner who had challenged the policy.2

By contrast, in this case the FCC never indicated any doubt

as to the constitutionality of its affirmative action/EEO policy.

Still, if the Church had supported the Commission's motion in

this case, we might well have ordered a remand.

The Church's position was quite understandable. It is

simply not so, as the Commission contends, that if we had

ordered a remand and the Commission had modified its

opinion as its counsel indicated that it would, that the Church

would have been granted complete relief. The Church had

challenged both the King's Garden policy and the FCC's

EEO regulations. And the regulations, as we recognized in

our prior opinion, would continue to apply to the Church even

if King's Garden were overruled. In its Lutheran Church

order, the Commission indicated that any religious exemption

would apply to the entire set of EEO regulations. But in its

new policy statement, the Commission expressly disavowed

that position. 13 F.C.C.R. 6322, 6325 (1998) ("Religious

broadcasters will also remain subject to Sections 73.2080(b)

and (c) of the Commission's Rules ... notwithstanding any

suggestion to the contrary in Lutheran Church/Missouri

Synod, 12 F.C.C.R. 2152, 2166 n.9 (1997)."). The Church

would thus still remain obligated to exercise racial prefer-

ences within the pool of Lutheran applicants under the Com-

mission's EEO rules. As such, modification of the King's

Garden policy, whether pursuant to RFRA or the Commis-

sion's new policy, would not bring the Church into compliance

with the EEO regulations.

The Commission claims that the Church did not actually

challenge the future effect of the EEO regulations, rather

just their application to it in this case and the sanctions the

FCC imposed. But whenever a party challenges the regula-

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2 See Appellant's Response to Motion for Remand at 1, Steele v.

FCC, No. 84-1176 (D.C. Cir. 1986). It was the intervenor, and the

amici curiae, supporting the Commission's policy, who objected.

See Intervenor Dale Bell's Opposition to Motion for Remand at 1;

Joint Response to Motion for Remand at 1.

tory basis for a sanction it necessarily challenges the future

effect of the regulation. Understandably, the Church focused

its fire on the Commission's reasoning in this specific case,

but it nevertheless made clear that it was challenging the

constitutionality of the Commission's entire EEO regulatory

scheme as in violation of the Fifth Amendment.3 Certainly

that is why the Justice Department filed its amicus brief

directed only to that issue.

2. The RFRA/Free Exercise Ground

The Commission alternatively argues that we were obliged

to decide the RFRA challenge to the Commission's order

before reaching any constitutional issues or even if, as we

concluded, the RFRA challenge were intertwined with First

Amendment free exercise concerns, we were obliged to decide

that issue before we reached the Fifth Amendment question.

We find the Commission's position quite anomalous because

under its preferred order of disposition of issues we would

have had to decide the Fifth Amendment issue unless we

decided the RFRA/free exercise issue against it. Just as a

party ordinarily may not be heard to complain about the

reasoning of a decision in its favor, Powell v. Washington

Metropolitan Area Transit Commission, 466 F.2d 466 (D.C.

Cir. 1972), we think a losing party has no legal basis for

claiming a case should have been decided against it on

another ground. It may well be that the Commission really

assumes that if we had struggled first with the RFRA/free

exercise issue we would have been inclined to remand, in

which case this argument is really only another way to

present its remand contention.4

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3 The Church certainly raised a general equal protection chal-

lenge in its opening brief, and we have held that an appellant has

the right to amend its argument when the government makes such

a shift midway through the appeal. Dynalantic Corp. v. Depart-

ment of Defense, 115 F.3d 1012, 1015 (D.C. Cir. 1997).

4 The Commission's citation of the Supreme Court's recent deci-

sion in Federal Election Commission v. Akins, 118 S. Ct. 1777

(1998), in support of its position is of no help. In Akins, the

Supreme Court refused to address what we thought was a pure

We are certainly mindful of the doctrine that counsels

avoidance of constitutional issues, but as we have explained,

we do not see how deciding the case on RFRA/free exercise

grounds would have granted the Church complete relief.

And, as we also observed in our prior opinion, the RFRA/free

exercise issue is also constitutional in character. There is

simply no support for the Commission's peculiar notion that

some constitutional issues, like those involving the First

Amendment, are less important and should be decided before

Fifth Amendment claims.

3. Strict Scrutiny

It is important to recognize that the Commission's defense

rests solely on its contention that strict scrutiny does not

apply to its policy of seeking broadcast programming diversi-

ty through EEO employment guidelines. The Justice De-

partment had asserted that the Commission's policy was also

justified based on the Commission's legitimate interest in

preventing employment discrimination and that even if strict

scrutiny applied, the Commission's EEO employment guide-

lines met the compelling interest tests and narrow tailoring

that strict scrutiny requires. Seeking rehearing (in the peti-

tion filed jointly with the Commission) the Justice Depart-

ment abandoned the claim that the FCC's policy can with-

stand strict scrutiny. All the Commission's eggs--at least at

this stage--are placed in the standard of review basket.

The Commission's essential argument is that its rule "does

not require the station to adopt racial goals or achieve

proportional representation in its workforce," (emphasis add-

ed), and therefore strict scrutiny is inappropriate. FCC

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statutory issue. See Akins v. Federal Election Commission, 101

F.3d 731 (D.C. Cir. 1997). Instead, the Court remanded in light of

a possible constitutional issue that might arise as a result of the

Federal Election Commission (FEC)'s rules defining "members."

Far from avoiding the constitutional issue by deciding on statutory

grounds, the Supreme Court avoided decision on the statutory claim

by addressing a possible constitutional issue that had not even been

raised below.

Petition for Rehearing and Suggestion for Rehearing In Banc

at 12. Moreover, the Commission insists there is no evidence

in the record that this station, or any station, ever engaged in

racial hiring (presumably discriminating against a non-

minority).

We think that the Commission's position, accepted by our

dissenting colleagues, has two logical flaws. Chief Judge

Edwards insists that a regulation constitutes a racial classifi-

cation only if it requires or obliges someone to exercise a

racial preference. As we observed in our prior opinion, it is

clear that these regulations do effectively oblige the Church

to implement racial preferences in its hiring decisions. Lu-

theran Church-Missouri Synod, 141 F.3d at 351-52. But the

degree to which the regulations require, oblige, pressure,

induce, or even encourage the hiring of particular races is not

the logical determinant of whether the regulation calls for a

racial classification. In Adarand, the challenged regulations

did not require or obligate would-be contractors to grant a

preference to minority subcontractors. Adarand Construc-

tors, Inc. v. Pena, 515 U.S. 200 (1995). Rather, the regula-

tions provided a financial incentive to bidding contractors to

grant such a preference--an incentive that contractors were

free (at their economic peril) to disregard. Id. at 205-08.

Nonetheless, the Supreme Court treated the regulations as a

racial classification, and did not even pause to consider the

suggestion that the absence of a compelled racial preference

makes strict scrutiny inapposite. Because the FCC's regula-

tions at issue here indisputably pressure--even if they do not

explicitly direct or require--stations to make race-based hir-

ing decisions, under the logic of Adarand, they too must be

subjected to strict scrutiny. See also Monterey Mechanical

Co. v. Wilson, 125 F.3d 702, 710 (9th Cir. 1997).5 Judge Tatel

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5 The Ninth Circuit in Monterey stated that a classification

constitutes a racial classification if it "authorizes or encourages" a

racial preference. Monterey Mechanical Co., 125 F.3d at 710

(quoting Bras v. California Pub. Utilities Comm'n, 59 F.3d 869, 875

(9th Cir. 1995)). That a regulation becomes a racial classification if

it "authorizes" preferences may be disputable. We need not ad-

contends that the regulations do not provide "incentives" to

stations to engage in race-based personnel decisions, but as

we explained in our initial decision, Lutheran Church-

Missouri Synod, 141 F.3d at 351-52, we think that assertion

blinks reality.

By insisting on an "obligation or requirement" test, Judge

Edwards would make the analytical definition of a classifica-

tion depend on the degree of government pressure. Yet if

the regulations "suggested" an 80% white male workforce,

would there be any doubt as to the applicable standard of

review? See Monterey Mechanical Co., 125 F.3d at 711.

Although an analysis of the degree of government pressure to

grant a racial preference would no doubt be significant in

evaluating whether a regulation survives strict scrutiny, it is

the fact of encouragement--a fact that no one denies--that

makes this regulation a racial classification.6

That does not mean that any regulation encouraging broad

outreach to, as opposed to the actual hiring of, a particular

race would necessarily trigger strict scrutiny. Whether the

government can encourage--or even require--an outreach

program specifically targeted on minorities is, of course, a

question we need not decide. As we concluded in our prior

opinion, the Commission's regulations go far beyond any

nondiscriminatory outreach program. The imposition of nu-

merical norms based on proportional representation--which

is the core element to what are often referred to as affirma-

tive action, set aside, or quota programs--is the aspect of the

Commission's rule that makes it impossible for us to apply

any standard of review other than strict scrutiny.7 In other

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dress that question as the regulations here unquestionably "encour-

age" racial preferences under Adarand.

6 The Commission suggests that even if some stations engage in

"racial hiring" to avoid FCC scrutiny the employer's actions should

be thought of as "unilateral," not implicating the government. We

do not think that is a serious argument.

7 If a non-discriminatory hiring policy would necessarily yield a

workforce with a racial composition that matches that of the Metro-

politan Statistical Area, then it might be argued that requiring

employers to examine the racial composition of their workforces is

words, the regulations here must be subjected to strict scruti-

ny because they encourage racial preferences in hiring and as

such treat people differently according to race. We of course

do not claim, as Judge Tatel suggests, that all race conscious

measures adopted by the government must be subjected to

strict scrutiny. See supra n.5.

The second logical flaw in the Commission's argument,

adopted in Judge Tatel's dissent, concerns the claim that the

record includes no evidence that the Church has ever em-

ployed a racial preference in its hiring decisions. Judge Tatel

argues that absent such evidence strict scrutiny is inappropri-

ate. Yet the Commission (and presumably Judge Tatel)

concedes that if the regulation explicitly imposed quotas or

goals strict scrutiny should apply. But one would not know

at the time the quota or goal were imposed whether it would

necessarily cause a preferential hiring decision. It could be

contended that a goal or even a quota merely reflected a non-

discriminatory hiring pattern and therefore that an employer

who met the goal or quota never actually discriminated.

Therefore, if evidence of actual discrimination would not be

required before applying strict scrutiny in the explicit

quota/goal cases, there is no logical reason why it should be

required here. In truth, such an evidentiary obligation would

turn equal protection analysis inside out. Once a government

program is shown to call for racial classifications, the heavy

burden to justify it shifts to the government. The challenger

does not have to show that the program actually caused him

to discriminate in an actual case--a requirement which would

expose the challenger to the risk of admitting a Title VII

violation.

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simply an anti-discrimination enforcement technique that does not

implicate racial preferences. However, not only has the Commis-

sion provided no support for this proposition, but as we said in our

opinion, the Commission has in fact disavowed it, saying that "we do

not believe that fair employment practices will necessarily result in

the employment of any minority group in direct proportion to its

numbers in the community." Lutheran Church-Missouri Synod,

141 F.3d at 352.

The Commission's evidentiary argument also overlooks the

point that the Church comes before this court asserting the

constitutional rights of absent third parties: the prospective

non-minority applicants who will be denied equal treatment.

In cases in which a litigant is accorded third party standing--

which no one currently argues the Church lacks--there is

simply no requirement that the litigant identify the particular

individuals whose equal protection rights have been, or will

be, violated. And the Commission's proposed evidentiary

obligation is flatly inconsistent with the Supreme Court's

standing analysis in the affirmative action caselaw. The

Court has held that the alleged victim of unequal treatment

does not have to prove that the challenged policy was the "but

for" cause of his injury; the claim that the litigant was denied

equal treatment is sufficient to constitute Article III "injury-

in-fact." See Northeastern Fla. Chapter of the Associated

Gen. Contractors of Am. v. City of Jacksonville, 508 U.S. 656,

664-66 (1993). Thus, if a non-minority prospective Church

employee had challenged the constitutionality of the regula-

tions, he would not have to submit evidence demonstrating

that the Church's actual use of racial preferences (pursuant to

the regulations) was the cause of his failure to be hired. It

would be sufficient, for standing purposes, to show that the

regulations caused him to be treated differently from minori-

ties. That being so, we cannot understand how such a

litigant would be required, in order to trigger strict scrutiny,

to make a showing that the Church made use of a racial

preference in his particular hiring decision. And if an indi-

vidual litigant would not have to make such a showing,

neither does the Church standing in his or her place for the

purpose of this constitutional challenge.

The Commission en passant calls to our attention the

proposition that "statistics can be an important source of

proof in employment discrimination cases." But the Commis-

sion understandably does not link up that observation with

any part of their argument. It could appear to be directed to

the magnitude of government's interest, if strict scrutiny

applied, but, as we have noted, the Commission does not

claim that its regulations pass the strict scrutiny test. And,

in any event, as we pointed out in our prior opinion, the

Commission justified its EEO rule not as preventing discrimi-

nation but as achieving program diversity. It is clearly

designed to place an obligation on stations that goes consider-

ably beyond non-discrimination with respect to hiring minori-

ties.

That brings us to the interesting dissenting opinion of the

Chief Judge, who argues from Title VII disparate impact

cases that what the Commission has required here is not all

that different from the obligation an employer defendant has

to rebut a showing of disparate impact in which proportionali-

ty is relevant. It is perhaps sufficient to respond that

whatever the nature of the employer's burden under Title

VII, the Commission insisted that its regulation is not based

on employment diversity or anti-discrimination, but on pro-

gramming diversity. It was the Justice Department that

initially sought to ride both horses (which is why we observed

in our opinion that "diversity" can and is being used today as

a rather plastic term).

We think the Chief Judge, in any event, is wrong on his

broader point. Although statistics, to be sure, can be used in

Title VII cases, the statute does not encourage employers to

impose racial preferences in order to avoid Title VII liability.

Indeed, Title VII itself specifically disclaims any intention of

pressuring employers to impose racial preferences. See 42

U.S.C. s 2000e-2j (1994) ("Nothing contained in [Title VII]

shall be interpreted to require any employer ... to grant

preferential treatment to any individual or to any group

because of [ ] race...."). Since we held that the FCC's EEO

regulations, unlike Title VII, inevitably cause licensees to

grant racial preferences, we disagree that the Commission

could avoid the impact of our holding by merely adopting

Chief Judge Edwards' suggestion--that the FCC amend the

regulations to add the above quoted Title VII caveat. See

Chief Judge Edwards' dissent at [8]. For the Commission to

declaim unrealistically that the regulations are not to be

interpreted as requiring a preference--as Chief Judge Ed-

wards recommends--is to simply put forward a covering

fiction.

Even in Title VII disparate impact cases, quite different

sorts of statistics are employed for the limited purpose of

determining whether a particular sort of job requirement

disadvantages minorities. Comparing the proportionality of

minorities in the employer's workforce to the proportionality

of minorities in the overall population (the Metropolitan Sta-

tistical Area or MSA) is never the relevant comparison under

such cases; rather, the racial composition of those holding at-

issue jobs is compared with the racial composition of qualified

applicants or qualified persons in the labor market. See

Watson v. Fort Worth Bank & Trust, 487 U.S. 977, 994 (1988)

(O'Connor, J., plurality opinion). That the relevant statistical

gauge is not the proportionality of minorities in the overall

population is clear from the antidiscrimination rationale of

Title VII--the purpose of statistical evidence is to expose

possible discriminatory intent, not to establish a workforce

that mirrors the racial breakdown of the MSA.

If discrimination under Title VII were defined as non-

proportionality, much of the Supreme Court's recent equal

protection cases would make little sense. That is, "[a]t the

heart of the Constitution's guarantee of equal protection lies

the simple command that the Government must treat citizens

as individuals, not as simply components of a racial, religious,

sexual or national class." Metro Broadcasting, Inc. v. FCC,

497 U.S. 547, 602 (1990) (O'Connor, J., dissenting) (citation

and internal quotations omitted). Of course, in some situa-

tions unequal treatment is justified to account for past dis-

crimination, but societal discrimination is not enough to justi-

fy imposing a racially classified remedy. Richmond v. J.A.

Croson Co., 488 U.S. 469, 493-94, 499 (1989); cf. Contractors

Assoc. of E. Penn., 442 F.2d 159 (3d Cir. 1971) (holding that

an affirmative action program directly tied to past discrimina-

tion by construction unions did not violate Title VII). The

Supreme Court has never held that non-proportionality con-

stitutes discrimination. (The Commission itself disavowed

this position. Lutheran Church-Missouri Synod, 141 F.3d

at 352.) The Court has noted the danger that relying solely

on statistical disparities as proof of discrimination under Title

VII could result in the imposition of de facto quotas. Watson,

487 U.S. at 991-97 (O'Connor, J., plurality opinion). You

could achieve proportional representation quotas as easily by

that route as by requiring them explicitly. In sum, that

statistical evidence can be relevant in determining whether an

employer's past practice is discriminatory is not equivalent to

concluding that the absence of proportionality makes out

discrimination.

* * *

Accordingly, we deny the Commission's petition.