Appendix — Schmidt v. Serpas

c

4) Supreme Court, U.S.

87-6 44 FILED

No. OCT 15 1987

JOSEPH F. SPANIOL, JR.

CLERK

In THE

Supreme Court of the Gnited States

Octoser Term, 1987

CHARLES E. SCHMIDT, et al.

Petitioners,

v.

DON SERPAS, et al,

Respondents.

————E>E=E==ES=E>=ES=E=E=E=E=E=E=E=E=E=EEEEEEEEEE>E—q—=[=[T[=(LL—=L"]lCOSS=L|=[=[=[==DBDBnanDBDBoH=>_

APPENDIX TO THE PETITION FOR WRIT OF

CERTIORARI TO THE UNITED STATES COURT

OF APPEALS FOR THE SEVENTH CIRCUIT

NEIL F. HARTIGAN

Attorney General, State of Illinois

SHAWN DENNY

Solicitor General, State of Illinois

100 West Randolph Street, 12th Floor

' Chicago, Illinois 60601

(312) 917-3000

Attorneys for Petitioners

MosHE Jacosrus *

Assistant Attorney General

100 West Randolph Street, 13th Floor

Chicago, Illinois 60601

(312) 917-3539

Of Counsel * Counsel of Record

Printed by Authority of the State of Illinois (PO. 33846—55—10-15-87)

TABLE OF CONTENTS

A— Amended Opinion of the United States Court

of Appeals for the Seventh Circuit, July 17,

ee Te oe ee Ee ee

B— Opinion of the United States Court of Appeals

for the Seventh Circuit, December 19, 1986 ..

C— Memorandum Opinion of the United States Dis-

trict Court, Northern District of Illinois, July

hg Ne 5a bik LEN CRW NGA RGA sere nt 0

D— Memorandum Opinion of the United States Dis-

trict Court, Northern District of Illinois, June

Ue ME as cs oS RV co cee ese ree ews

PAGE

A-1

B-1

C-1

In THE

Supreme Court of the Gnited States

Octoser Term, 1987

CHARLES E. SCHMIDT, et al.,

Petitioners,

v.

DON SERPAS, et al,

Respondents.

APPENDIX TO THE PETITION FOR WRIT OF

CERTIORARI TO THE UNITED STATES COURT

OF APPEALS FOR THE SEVENTH CIRCUIT

A-l

APPENDIX A

AMENDED OPINION

IN THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

No. 85-2393

Don SERPAS, RAYMOND JOHNSON and CARL WATERS,

individually and on behalf of all others similarly situated,

Plaintiffs-Appellees,

Vv.

CHARLES E. SCHMIDT, et al.,

Defendants-Appellants.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 82 C 4715—Charles P. Kocoras, Judge.

ARGUED APRIL 2, 1986—DeEcIDED JULY 17, 1987

Before CUDAHY and RIPPLE, Circuit Judges, and

ESCHBACH, Senior Circuit Judge.

Cupany, Circuit Judge. Plaintiffs brought this suit, in-

dividually and on behalf of all exercise persons, grooms

and hot walkers (collectively, “backstretchers’’) at Illinois

race tracks, seeking declaratory and injunctive relief from

certain investigative practices authorized by the Illinois

Racing Board (the “Board”) and carried out by the IIli-

nois Department of Law Enforcement (‘“‘IDLE”’) on the

ground that these practices violated the Fourth Amend-

ment, as applied to the state of Illinois through the Four-

A-2

teenth Amendment. The challenged practices included

warrantless searches of the backstretchers’ on-track

dormitory rooms and investigatory stops and searches of

the backstretchers’ persons within the race track en-

closure. Plaintiffs also challenged the Board’s policy of

granting them occupation licenses only upon their consent

to these searches. The defendants argued that the plain-

tiffs lack a legitimate expectation of privacy owing to per-

vasive state regulation of the horse-racing industry, to the

nature of the premises searched and to the plaintiffs’ im-

plied consent to the searches when they accepted their

employment. The district court granted the plaintiffs’ mo-

tion for a preliminary injunction and, later, enjoined the

searches permanently on plaintiffs’ motion for summary

judgment. We affirm.

Backstretchers work at race tracks, feeding, grooming,

exercising and generally taking care of the race horses.

They are employed by the horses’ trainers and licensed by

the Board under authority vested in the Board by the Horse

Racing Act of 1975 (the “Act”), Ill. Ann. Stat. ch. 8, para.

37 (Smith-Hurd Supp. 1987). Many of the backstretchers

live in dormitory rooms located in the backstretch, which

is the area where the horses are stabled. These rooms

are owned by the race track and made available to the

trainers and the backstretchers in their employ at no

charge. Backstretchers do not have to live at the track,

but many do so for reasons of convenience and economy.

Because backstretchers have contact with the race

horses immediately before and between races, they are

in a position to administer drugs or apply mechanical

devices (called “‘buzzers”’) to the horses, both of which af-

fect the speed of a horse and hence the outcome of a race.

The Act forbids these practices. Ill. Ann. Stat. ch. 8,

paras. 37-36, 37-37 (Smith-Hurd Supp. 1987). The Board

and IDLE, which the legislature charged with the enforce-

ment of the Act, Ill. Rev. Stat. ch. 8, para. 37-34 (1983),

believe that warrantless searches of all backstretch areas,

including the dormitories, and of licensees’ persons is the

only effective way of enforcing the statutory prohibitions

against the use of drugs and buzzers. Backstretch areas

A-3

and licensees are searched when IDLE has received a “tip”

or when irregularities are noted in a horse’s performance;

searches are also performed at random. We have no reason

to question the Board’s representations about the threat

posed by drugs and buzzers and its need to take strong

measures against them.

In this respect, the Act vests in the Board broad au-

thority to regulate the horse-racing industry in Illinois.

Specifically,

The Board, and any person or persons to whom it

delegates this power, is vested with the power to

enter the office, horse race track, facilities and other

places of business of any organization licensee to de-

termine whether there has been compliance with the

provisions of this Act and its rules and regulations.

Ill. Ann. Stat. ch. 8, para. 37-%c) (Smith-Hurd Supp. 1987).

Pursuant to its rulemaking powers, the Board has promul-

gated Thoroughbred Rules 322 and 25.19 (the “Rules’’),

which employ identical language and read as follows:

(a) The Illinois Racing Board or the state steward

investigating for violations of law or the Rules and

Regulations of the Board, shall have the power to

permit persons authorized by either of them to search

the person, or enter and search the stables, rooms,

vehicles, or other places within the track enclosure

at which a meeting is held, or other tracks or places

where horses eligible to race at said race meeting

are kept, of »ll persons licensed by the Board, and

of all employees and agents of any race track oper- |

ator licensed by said Board; and of all vendors who

are permitted by said race track operator to sell and

distribute their wares and merchandise within the

race track enclosure, in order to inspect and examine

the personal effects or property on such persons or

kept in such stables, rooms, vehicles, or other places

as aforesaid. Each of such licensees, in accepting a

license, does thereby irrevocably consent to such

search as aforesaid and waive and release all claims

or possible actions for damages that he may have by

A-d

virtue of any action taken under this rule. Each em-

ployee of a licensed operator, in accepting his employ-

ment, and each vendor who is permitted to sell and

distribute his merchandise within the race track en-

closure, does thereby irrevocably consent to such search

as aforesaid and waive and release all claims or possi-

ble actions for damages they may have by virtue of

any action taken under this rule. Any person who

refuses to be searched pursuant to this rule may have

his license suspended or revoked.

(b) The Illinois Racing Board delegates the author-

ity to conduct inspections and searches, under this

rule, to the Chief Investigator of the Illinois Racing

Board and to Special Agents of the Illinois Bureau

of Investigation, or other designees of the Depart-

ment of Law Enforcement assigned, from time to

The challenged searches were undertaken pursuant to this

regulation.

The Act also empowers the Board to prescribe applica-

tion forms and issue licenses to backstretchers. Ill. Ann.

Stat. ch. 8, paras. 37-15, 37-20 (Smith-Hurd Supp. 1987).

Prior to the entry of the preliminary injunction in this case,

the license application form used by the Board quoted the

text of the above Rules and conditioned the license’s issuance

upon consent to the searches authorized by the Rules.

The material facts about the searches of the named

plaintiffs are undisputed.! Don Serpas, Raymond Johnson

and Carl Waters are employed as grooms and live in resi-

dential quarters at Arlington Park Racetrack. Their resi-

dential quarters have been searched by IDLE agents;

they have also been stopped and personally searched by

1 The affidavits submitted _= parties differed in some of the

details of the searches. The district court did not consider any of

these ~_° utes material. See Memorandum Opinion, v.

Schmidt, No. 82-C-4715 (N.D. Ill. June 16, 1983), at 2 n.2. The ap-

pellants do not contest before this court the propriety of deciding

the question presented to the district court by summary judgment.

A-5

IDLE agents within the race track enclosure. No evidence

of crime was found during any of the challenged searches.

The plaintiffs acknowledge that when they signed the

license application forms, they consented to the searches.

They also admit that they consented to each of the searches

at the time it occurred. They claim, however, that they

would not have consented to these warrantless searches

if they had not been required to give consent in order

to remain in a job as a backstretcher.

On July 30, 1982, these three plaintiffs filed a complaint

in the Northern District of Illinois, naming as defendants

present and former members of the Board, the director

of IDLE and certain unknown IDLE agents and seeking

injunctive and declaratory relief. On September 24, 1982

they filed a motion for a preliminary injunction, which was

granted in its entirety on June 16, 1983. This order of

the district court enjoined the defendants from (1) con-

ducting or authorizing searches of persons and residen-

tial quarters without a warrant or probable cause; (2) con-

ducting or authorizing investigatory stops of backstretchers

without a reasonable suspicion, based on articulable facts,

that the backstretchers stopped were engaged in criminal

activity; and (3) conditioning the issuance of occupation

licenses to backstretchers upon consent to these searches.

Memorandum Opinion and Order, Serpas v. Schmidt, No.

82-C-4715 (N.D. Ill. June 16, 1983).

On September 19, 1983 the trial court certified Serpas,

Johnson and Waters as named representatives of a class

consisting of all grooms, exercise persons and hotwalkers

at Illinois racetracks. In August and October 1984, the

parties filed cross-motions for summary judgment. The

trial court filed a memorandum opinion, granting the plain-

tiffs’ motion and entering a permanent injunction on July

11, 1985. Memorandum Opinion, Serpas v. Schmidt, No.

82-C-4715 (N.D. Ill. July 11, 1985). This appeal followed.

2 After oral argument we asked the parties to provide us with

additional briefing on the question whether we should abstain and

(Footnote continued on following page)

A-6

2 continued

ong Song any conte wo ee es ee Se eS

case, arguably mooting constitutional questions.

See Railroad Commission of Texas v. Pullman Co., 312 U.S. 496

(1941). This question was at oral argument in the

course of questioning by the panel.

After examining the tal briefs, we have concluded that

abstention is not in this case. As the dissent correct-

held that it might be proper in some

has

cases for an appellate court to order abstention even though

e See Waldron v. McAtee, 723

it would be appropriate for us to order abstention sua sponte here.

In the controversy before us, the federal courts are not “the lone

guardian of the state’s sovereign place under the Constitution,”

jonicn't having the claims agin Roe Magied to teteeel eomrt

to court

eee thin court heatt reloed 1 de tay cag Ay sen v.

Hill, 55 U.S.L.W. 4823, 4828 n.16 (U.S. June 15, 1987) (failure of

defendant city to raise possibility of abstention until after it had

lost on the merits before an appellate court undercut the force

of the city’s nt); Mazanec v. North Judson-San Pierre

School ’ F.2d 845, 848-49 (7th Cir. 1985) (State defen

In addition, there is a presumption in this circuit abstain-

has gone to trial; this presumption holds at least

‘where neither Py ee at before trial.” Mazanec,

‘ court in this case ted the plain-

tiffs’ motion a 8 ee ee in 1983 and enjoined the

searches permanently in 1985 on plaintiffs’ motion for summary

judgment. The defendants did not raise an abstention issue dur-

ing any of these proceedings, nor did they raise it before us. The

ny Pacem md wy mapllndanad: «garnet ee Hm la

cause Mazanec states presumption against abstaining may

be rebutted if the state statute at issue could be interpreted

narrowly and thus survive a constitutional challenge. /nfra, p. 16

n.3. We believe, however, that the resolution of the constitutional

in this case t well be even if a state court

the Act not authorize the Rules. If the plaintiffs

had validly consented to the searches or if they had a reduced

(Footnote continued on following page)

A-7

A. Warrantless Searches of Dormitory Rooms

The Fourth Amendment protects against “unreasonable”

— and seizures. The she ag of a areal de-

pends upon a person’s expectation of privacy in the place

to be be ard provided that that expectation is one that

society is willing to recognize as ‘‘reasonable.” Katz v.

United States, 389 U.S. 347, 361 (1967) (Harlan, J., con-

curring). Appellants contend that the backstretchers’ as-

serted expectation of privacy in their on-track dormitory

rooms is not the sort of expectation that society recog-

nizes as reasonable. They rely on historic state regula-

tion of the horse-racing industry, the less than commodi-

ous quality of the on-track quarters and the backstretchers’

implied consent to the searches.

We have no doubt that horse racing is and ought to

be a pervasively regulated industry. But a history of per-

vasive regulation of an industry is not by itself enough

to render the warrant requirement superfluous. As we

noted in Bionic Auto Parts and Sales, Inc. v. Fahner,

721 F.2d 1072, 1079 (7th Cir. 1983),

the degree and extent of past regulation comprise but

a part, albeit a substantial part, of a determination

of a “reasonable expectation of privacy” under the

Fourth Amendment. Otherwise, no protections at all

would be appropriate in closely regulated industries.

The Fourth Amendment requires that a determina-

tion of the “reasonableness” of the intrusion be made.

Even in closely regulated industries, the inspection

provisions still must be tailored to the state’s proper

objectives, and they must minimize the dangers in-

herent in the unbridled exercise of administrative dis-

cretion.

2 continued

expectation of privacy, it certainly could be argued that the defen-

dants would not have needed an independent basis of authority

under state law to conduct the searches. Thus, abstention might

not produce a state law result which would be dispositive of the

claims under the federal constitution. -

A-8

It is certainly true, as appellants point out, that the Su-

preme Court has sanctioned warrantless searches of com-

mercial premises in certain industries subject to long-

standing governmental oversight. New York v. Burger, 55

U.S.L.W. 4890 (U.S. June 19, 1987) (junkyards); Donovan

v. , 452 U.S. 594 (1981) (mining); United States v.

Biswell, 406 U.S. 311 (1972) (firearms); Colonnade Cater-

ing Corp. v. United States, 397 U.S. 72 (1970) (alcoholic

beverages). In each of these cases, however, an Act of

Congress expressly authorized the terms and conditions

of searches on specified premises. The rationale for not

requiring a warrant in such a situation is that a statutory

inspection program “in terms of the certainty and regular-

ity of its application, provides a constitutionally adequate

substitute for a warrant.” Dewey, 452 U.S. at 603. In that

way, there is assurance that the individual’s privacy in-

terest and the government’s interest in law enforcement

are nroperly balanced. See Marshall v. Barlow’s, Inc., 436

U.S. 307, 321 (1978) (‘The reasonableness of a warrantless

search . . . will depend upon the specific enforcement

needs and privacy guarantees of each statute.”).

The statutory authority claimed by the appellants for

the searches challenged here states that the Board and its

delegates are “‘vested with the power to enter the office,

horse race track, facilities and other places of business’”’ of

any licensee to ensure compliance with the Racing Act. Ill.

Ann. Stat. ch. 8, para. 37-9(c) (Smith-Hurd Supp. 1987). Far

from specifying the “terms and conditions” under which war-

rantless searches of dormitory rooms can be conducted, this

statute does not even appear to authorize searches of these

areas. Appellants contend that the dormitory rooms are

“facilities” for purposes of the Racing Act. We agree with

the district court that this is not a reasonable reading of the

statutory language. The provision specifically lists a series

of places, ending with the catch-all ‘other places of busi-

ness.” This concluding phrase effectively defines the

earlier listed places as places of business. The statute in

no way suggests that a residence may be searched. We

agree with the district court that these on-track dormitory

A-9

rooms must be considered the backstretchers’ “homes”

for Fourth Amendment purposes. Appellants point out

that the rooms are very small and located either adja-

cent to or above the stables in the backstretch of the

track. Further, they are only temporary lodgings and are

accessible to track authorities by a master key. Nonethe-

less, they are exclusively residential, and lodgings as

cramped, inhospitable or temporary have been considered

residences by the courts. See Stoner v. California, 376

U.S. 483 (1964) (hotel rooms); McDonald v. United States,

335 U.S. 451 (1948) (rooming houses); Smyth v. Lubbers,

398 F'. Supp. 777 (W.D. Mich. 1975) (college dormitories).

There is no evidence that the backstretchers conduct

any of their business in the rooms; thus, cases such as

United States v. Cerri, 753 F.2d 61 (7th Cir.), cert. denied,

472 U.S. 1017 (1985), where petitioner conducted his gun

business out of his home, are distinguishable. Given the

legal protection historically afforded the home by the

Fourth Amendment, see, e.g., United States v. United

States District Court, 407 U.S. 297, 313 (1972) (“physical

entry of the home is the chief evil against which the word-

ing of the Fourth Amendment is directed’’), we will not

assume that the Illinois legislature meant to authorize

warrantless residential searches unless it clearly stated

this intention. Thus, because this statute does not even

contemplate searches of residences, the statute does not

provide any limitations on the discretion of track officials

who wish to conduct searches of dormitory rooms. Cf.

Burger, 55 U.S.L.W. 4890 (Warrantless search of auto-

mobile junkyard pursuant to statute was upheld; statutory

scheme limited time, place and scope of such inspections.).

Even without = statutory authorization for these

searches, the appellants contend that sufficient certainty

of application to serve as a substitute for a warrant can

be found in the regulatory scheme taken as a whole. We

disagree. To satisfy the “certainty and regularity” require-

ment, an “inspection program must define clearly what

is to be searched, who can be searched, and the frequen-

cy of such searches.” Bionic Auto Parts, 721 F.2d at 1078.

A-10

The rules under which the IDLE agents operated do not

impose any meaningful limitations on their discretion. As

the district court noted,

The searches may be focused or random and are not

restricted to particular times nor restricted to partic-

ular areas or items in those areas which are in plain

view. . . . [T]he agents may search plaintiffs’ living

quarters and personal effects as extensively as they

wish. Plainly, the agents have an unrestricted scope

-of search; requiring them to hand out receipts or con-

sent forms does not affect or limit the agent’s discre-

tion to undertake an exhaustive search of every per-

sonal effect in an individual’s room.

Serpas v. Schmidt, supra, at [8]. The regulatory scheme

here thus falls short of adequately substituting for a war-

rant. As the Supreme Court explained in rejecting a war-

rantless search scheme in Camara v. Municipal Court,

387 U.S. 523, 532-33 (1967), “[tJhis is precisely the discre-

tion to invade private property which we have consistently

circumscribed by a requirement that a disinterested party

warrant the need to search.”

There is no reason to doubt that drugs and mechanical

devices pose major threats to the integrity of the horse

racing industry. Nor do we question the reality of the

Board’s concerns about protecting horse racing without

broad powers of surveillance over backstretchers and

others. But the Fourth Amendment requires regularity

of application and an impartial assessment of reasonable-

ness, and neither the controlling statute nor the regula-

tions in this case impose any restrictions on the conduct

of warrantless searches of residences. Hence, we agree

with the district court that neither the statute nor the

regulatory scheme here is sufficient to except these searches

from the general rule that searches conducted without the

safeguard of a warrant are unreasonable and violate the

Fourth Amendment, see Johnson v. United States, 333

U.S. 10, 13-14 (1948).

A-11

Finally, the appellants argue that the backstretchers im-

pliedly consented to the searches by accepting occupation

licenses conditioned upon compliance with Rules 322 and .

25.19. Conditioning the receipt of a benefit, such as em-

ployment, on the relinquishment of a right that one would

otherwise have is not per se unconstitutional. See, e.g.,

Snepp v. United States, 444 U.S. 507, 509 n.3 (1980);

United States Civil Serv. Comm’n v. National Ass’n of

Letter Carriers, 413 U.S. 548, 567 (1973). The race track

employees consented to the searches based on a regula-

tory program that required them to give their consent

as a condition of employment. As we have already found,

however, the regulations were not authorized by statute

and were unconstitutional because neither the regulations

nor the governing statute confined the discretion of the

state officials conducting the searches. Thus, the validity

of the employees’ consent was vitiated by the fact that

it was premised on the existence of the otherwise unau-

thorized and unconstitutional regulations.

B. Warrantless Searches of the Backstretchers

The district court also enjoined the Board and IDLE’s

practice of conducting warrantless stops and searches of

the backstretchers’ persons within the race track enclo-~

sure. Appellants have not suggested that we should analyze

the personal searches any differently from the residen-

tial searches, and we, too, think that the same rules apply.

Like searches of property, searches of the person are gen-

erally impermissible absent a warrant issued upon a deter-

mination of probable cause. New York v. Belton, 453 U.S.

454, 457 (1981); Mary Beth G. v. City of Chicago, 723 F.2d

1263, 1268 (7th Cir. 1983). The deficiencies we have noted

in the statute and regulatory scheme apply equally to

these personal searches, and the arguments based upon

consent are equally unpersuasive in this context.? Cf.

3 Appellants argue that we are bound to reverse the district court

on the authority of the Supreme Court’s summary affirmance of

the unpublished decision of a three-judge panel in Wilkey v. IIli-

(Footnote continued on following page)

A-12

Shoemaker v. Handel, 795 F.2d 1136, 1143 (8d Cir. 1986)

vias geievani scheme that subjected jockeys to breathalyzer

and urine tests was upheld against a Fourth Amendment

challenge, in part, because discretion of officials conduct-

ing such searches was appropriately circumscribed by regu-

lation), cert. denied, 107 S. Ct. 577 (1986).

As we have noted, we are certainly not unsympathetic

to the appellants’ argument that extraordinary surveil-

lance procedures are necessary to preserve the integrity

of horse racing. The simple fact is, however, that the IIli-

nois statute and regulations fall far short of providing an

adequate basis for the extraordinary procedures under-

taken here.

For the foregoing reasons, the judgment of the district

court is AFFIRMED.

3 continued

nois Racing Board, No. 74-C-3524 (N.D. Ill. 1975), affd, 423 U.S.

802 (1975). In that case the court upheld a Board rule that author-

ized a personal search of a licensee veterinarian in the backstretch

of the track. Unpublished opinions have no precedential effect in

this circuit: See Circuit Rule 35. Summary affirmances by the

Supreme Court do have some precedential effect, although they

the lower court’s et only and not its rationale. Sum-

mary affirmances ‘‘prevent lower courts from coming to ——

conclusions on the precise issues presented and necessarily decided

by those actions.” Mandel v. Bradley, 432 U.S. 178, 176 (1977).

Wilkey involved a challenge by a Board-licensed veterinarian to

Rule 322. He had lost his license after refusing to consent to a

personal search. Precedential effect “is to be assessed in light of

all of the facts of the case,” id. at 177, and Wilkey is distinguish-

able, notably in that the Board argued that there was probable

cause to search Wilkey. Further, we note that the Court affirmed

Wilkey before its more recent pronouncements on the limits of

the administrative search exception, Marshall v. Barlow’s, Inc.,

supra, and “Donovan v. , supra. In light of these factors,

we do not think we are bound by the Supreme Court’s summary

affirmance in Wilkey.

A-13

ESCHBACH, Senior Circuit Judge, dissenting. The fed-

eral courts should abstain from deciding this case to pro-

vide the state courts of Illinois an opportunity to construe

the state statute at issue, thus potentially significantly

altering or entirely mooting the constitutional inquiry.

Thus, while I have no particular objection to the constitu-

tional jurisprudence set forth in the majority opinion, I

must dissent.

The challenged searches in the instant case were author-

ized by the Illinois Racing Board (the ‘“‘Board’’) under

Thoroughbred Rules 322 and 25.19 (the “Rules”), and

were purportedly issued under the authority of the Horse

ing Act of 1975, as amended (the ‘“‘Act’’), Ill. Rev.

Stat. ch. 8, § 37-9 (Smith-Hurd Supp. 1986). After under-

going searches of their persons and rooms at a racetrack

pursuant to these Rules, the plaintiffs filed an action in

federal district court, claiming a violation of 42 U.S.C.

§ 1 1982), and requesting damages as well as declar-

atory and injunctive relief.1 The district court denied dam-

ages but issued a permanent injunction prohibiting defen-.

dants from enforcing the Rules via searches like those

challenged. The trial court also declared the Rules invalid

under the Fourth Amendment, a determination entirely

unnecessary on the record in this case. Only the decisions

on injunctive and declaratory relief have been challenged

on appeal.

This court has a duty under the narrow strictures of

Pullman abstention, Railroad Commission of Texas v.

Pullman, 312 U.S. 496, 61 S. Ct. 643 (1941), to maintain

1 Some justices have on occasion taken the position that Pullman

abstention ought not to apply to cases brought under the Civil

— Act, see, e.g., Harrison v. NAACP, 360 U.S. 167, 180-81,

Ct. 1025, 1032 (1959) (Douglas, J. , dissenting, joined b Warren,

C.J., and Brennan, J.); Boehning v. Indiana State mployees

Ass'n, 423 U.S. 6, 8, 96 S. Ct. 168, 170 (1975) (Douglas, J., dissent-

ing), but that — has never commanded a majority of the

Court, and Pul abstention remains applicable, see, e.g. Boehn-

ing, 423 U.S. at 6-8, 96 S. Ct. at 168-70 (per curiam).

A-14

the comity and federalism fundamental to the Constitu-

tion by avoiding unnecessary friction with the state courts.

See, e.g., Harrison v. NAACP, 360 U.S. 167, 176, 79 S.

Ct. 1025, 1030 (1959) (Harlan, J.). We also have a duty

to avoid unnecessary constitutional adjudication. See, e.g.,

Ashwander v. Tennessee Valley Authority, 297 U.S. 288,

345-48, 56 S. Ct. 466, 482-83 (1936) (Brandeis, J., concurring).

The “paradigm of the ‘special circumstances’ ” that must

exist before invoking Pullman’s narrow exception to the

exercise of federal jurisdiction is “‘a case where the chal-

lenged statute is susceptible of a construction by the state

judiciary that would avoid or modify the necessity of reach-

ing a constitutional question.” Babbitt v. United Farm

Workers National Union, 442 U.S. 289, 306, 99 S. Ct.

2301, 2313 (1979) (quoting with approval Kusper v. Pon-

tikes, 414 U.S. 51, 54, 94 S. Ct. 303, 306 (1973)); see also

Waldron v. McAtee, 723 F.2d 1348, 1352 (7th Cir. 1983);

City Investing Co..v. Simcox, 733: F.2d 56, 60 (7th Cir.

1980).

This is such a case. No Illinois court has yet addressed

the question of whether the challenged searches and Rules

under which they were made were beyond the authority of

the Act. The majority here and the district court below

both appear to believe the Rules invalid for precisely that

reason. If the Rules are invalid, the challenged searches,

which exclusively relied upon the Rules, are all also invalid,

and the case is concluded without constitutional adjudica-

tion. Every personal and residential search in this action

was performed by agents of the Illinois Department of

Law Enforcement (“IDLE”), to whom the Board had dele-

gated the authority to enforce the Rules. On the record

in this case, the agents of IDLE claimed only the author-

ity of the Rules for every search challenged. No other

authority is claimed in the record to justify these searches.

Even the occupational licenses required of each worker

to gain employment were conditioned upon signing a con-

sent to searches under the authority of the Rules. While

the attorneys argued other authority to this court in their

briefs, those arguments are merely legal arguments con-

A-15

structed after the institution of litigation. The crux of the

matter is that the facts established by the record do not

support a plea to any authority except the Rules to justify

these searches, and the litigants cannot inject extraneous

issues into the case via the briefs. Given the exclusive

reliance by the IDLE agents on the Rules, the validity

of the Rules is the only issue properly before this court,

and it may well be decided by state law.

Thus this case calls for abstention because the statute

leaves “reasonable room for a construction by the [state]

courts which might avoid in whole or in part the neces-

sity for federal constitutional adjudication, or at least

materially alter the problem.” Harrison, 360 U.S. at 176,

79 S. Ct. at 1030; see also Boehning v. Indiana State E'm-

ployees Association, 423 U.S. 6, 6-8, 96 S. Ct. 168, 168-70

(1975) (per curiam); Lynk v. LaPorte Superior Court No.

2, 789 F.2d 554, 568 (7th Cir. 1986).

In this case, the Illinois courts obviously might provide

a limiting construction that would place the challenged

searches beyond the Act, see Hawaii Housing Authority

v. Midkiff, 104 S. Ct. 2321, 2327 (1984) (significant possibil-

ity of a limiting construction justifies abstention); Harrison,

360 U.S. at 176, 79 S. Ct. at 1030 (abstaining because of

significant possibility of limiting construction); see also

Lynk, 789 F.2d at 568, for the Act does not specifically or

explicitly authorize either personal or residential searches.

Such an interpretation of the Act would significantly al-

ter, if not entirely moot, the constitutional question. The

strong possibility of such a limiting construction should

deter us from declaring the issue so clear that we will

not first defer to a state court’s interpretation of its own

law. Cf. Kusper v. Pontikes, 414 U.S. 51, 94 S. Ct. 303

(1973) (abstention improper because state law not suscep-

tible of an interpretation that might avoid constitutional

adjudication); Harman v. Forssenius, 380 U.S. 528, 534-

35, 85 S. Ct. 1177, 1182 (1965) (same); Board of Education

v. Bisworth, 713 F.2d 1316, 1321 (7th Cir. 1983) (same).

It might be argued that it is inappropriate to order

abstention at the appellate level when the issue was not

A-16

raised below or suggested by the parties on appeal.? But

we have recently held otherwise. In Waldron v. McAtee,

723 F.2d 1348 (7th Cir. 1983), we held that “the court

has the power and in an appropriate case the duty to

order abstention, if necessary for the first time at the ap-

pellate level, even though no party is asking for it.’ Jd.

at 1351. Our duty is to the federalism inherent in the Con-

stitution, and we are thereby bound to respect the sover-

eignty of the states and to avoid unnecessary constitu-

tional adjudication.*

Procedural concerns bolster the argument for absten-

tion in this case. The purpose of legal procedure is to ex-

pedite the full and frank consideration of substantive legal

disputes. If the appellate courts do not order abstention

where it is appropriate simply because it was not raised

below, litigants will be encouraged to avoid abstention by

excluding crucial state issues from their pleadings. Such

a practice would place abstention largely in the hands of

the litigants, and in many cases the individual goals of

each litigant may counsel avoidance of abstention, thus

obscuring and perhaps emasculating the interests of the

sovereign states in the regulation of their own affairs.

When a case presents issues meeting the threshold require-

ments necessary to invoke the narrow doctrine of Pull-

2 We raised the potential applicability of abstention at the oral

argument on appeal, and the parties then filed briefs on the issue

at our request.

3 We recently held in Mazanec v. North Judson-San Pierre

School Corp., 763 F.2d 845, 848 (7th Cir. 1985), that a trial court

had abused its discretion by ordering abstention subsequent to the

date trial was concluded, and three years after litigation was com-

menced. Mazanec itself distinguished Waldron by noting that in

Waldron there was a significant possibility that the statute would

be held unconstitutional as it stood, but that the state might

“save” it by limiting it to pass constitutional muster. Jd. at 848.

The facts at bar are similar to Waldron; a state court’s interpreta-

tion of the Rules and the Act might avoid the necessity of strik-

ing down a state law or regulation on constitutional grounds. Thus

aldron is the appropriate precedent to apply to the case at bar.

A-17

man abstention, the court may be the lone guardian of

the state’s sovereign place under the Constitution, We

should not shirk that duty.

The majority suggests in a footnote that even if the Act

does not authorize the challenged searches, we would still

be required to reach the defendants’ constitutional argu-

ments based on the plaintiffs’ consents to the searches.

I do not agree. The Board conditioned the granting of

employment licenses upon consent to the Rules, and the

district court found that the employees’ individual. con-

sents at the time of each search were given under the

threat of dismissal based upon the authority of the Rules.

The invalidation of the Rules would preclude any future

search based upon consent to the Rules, and would pre-

vent the use of consent forms requiring consent to such

searches under the authority of the Rules. If the Rules

no longer exist, searches may not be based on their au-

thority.

It should also be noted that even with the Rules and

consents invalidated, the plaintiffs would still have to show

the trial court that they continued to meet the threshold

requirements necessary to support an injunction. While

the district court found that “in the absence of’ perma-

nent injunction, they [the plaintiffs] will continue to have

their houses and persons searched without a warrant,”’

it a did not consider the effect invalidating the

Rules would have on police behavior. It is pure specula-

tion to posit that the agents of IDLE would continue

these searches subsequent to the invalidation of the Rules;

indeed, the agents conducted the personal and residen-

tial searches in the backstretch area only in reliance upon

the validity of the Rules, as the record shows. There are

no findings regarding this crucial point in the district

court’s opinion, and this silence highlights the fundamen-

tal weakness in the majority’s opinion: the validity of the

searches absent the Rules was-not presented to the dis-

trict court under the record in this case, and should not

be at issue before this court.

A-18

The majority also contends that the invalidity of the

Rules would not dispose of the defendants’ constitutional

argument based upon a reduced expectation of privacy

due to pervasive government regulation of the horse racing

industry. I disagree. The pleadings do not place this de-

fense in issue except in reference to the validity of the

Rules. Throughout this action, neither party has raised

the argument that the searches were authorized in the

absence of the Rules.4 While the parties may have in-

tended or hoped to put such a theory into this case by

their briefs to this court, the record here does not do so,

and this court is not at liberty to resolve issues not pre-

4 In their answer the defendants pleaded that sections 37-2 and

37-15 of the Act both independently authorized the Rules, even

if section 37-9 did not. Defendants never again explicitly cited,

argued, or relied upon the putative authority provided by these

sections, and plaintiffs only cursorily argued their insufficiency in

authorizing the Rules. More importantly, the district court appears

to have decided that the two sections were not at issue, or that

the arguments based upon them were so frivolous as to not even

require comment, for the court made no mention of them in its

opinion. Whatever the statutory or constitutional merits of argu-

ments based upon these sections, they are still framed to authorize

the Rules, not to directly authorize searches in the absence of the

Rules. Thus their invocation does not affect the focus of this dis-

sent, which is that the validity of the Rules.under state law is

a crucial question whose resolution will significantly alter or en-

tirely moot the constitutional issues in this case.

The defendants did raise an affirmative defense that “‘warrant-

less searches and seizures and investigatory stops of occupational

licensees within the race track enclosure do not violate the Fourth-

Amendment to the United States Constitution since horse racing

licensees have notice of the likelihood of warrantless searches by

the pervasiveness of regulation and by the long history of govern-

mental regulation of this business.” (Citations omitted.) However,

defendants did not explicitly make clear whether “pervasiveness

of tion” in this defense included the challenged Rules, and

the ubiquitous reliance upon the Rules throughout the rest of the

defendants’ pleadings and briefs strongly suggest that this defense

also relied upon the validity of the Rules. Surely defendants would

have explicitly announced any claims they believed authorized the

searches in the absence of the Rules.

A-19

sented by the record on appeal. Jn re Peter Bear, 789

F.2d 577, 579 (7th Cir. 1986); Johnson v. Levy Organiza-

tion Development Co., 789 F.2d 601, 611 (7th Cir. 1986)

Nevertheless, the majority today has gone beyond state

law unnecessarily and has decided a constitutional issue

not presented to the court. With all due respect, such a

decision is ill-advised. My concern is not merely technical;

while the parties have addressed themselves to the consti-

tutional requirements necessary to authorize a search

under a particular legislative scheme detailing require-

ments for such searches, the parties have not directly con-

fronted the constitutionality of such searches made with-

out explicit statutory guidelines, probable cause, or reason-

able suspicion in a pervasively regulated industry. This

court should not rule upon the issue until a case pre-

sents it and does so without also presenting a potentially

dispositive and uncertain issue of state law. Otherwise,

the court suffers the absence of the sharp definition of

issues and exhaustive consideration of legal argument such

a case would provide. The case presented to us turns on

an unclear issue of state law whose resolution may ob-

viate and would almost certainly significantly alter the

need for constitutional adjudication. I would abstain.

A-20

On Petition for Rehearing

Before BAvER, Chief Judge, Cummincs, CUDAHY, POSNER,

Correy, FLaum, EASTERBROOK, RIPPLE, MANION, and

KANNE, Circuit Judges, and Escusacu, Senior Circuit

a On January 30, 1987, the defendants-appellants

a petition for rehearing with tion of rehearing

en banc. A majority of the panel voted to deny the petition

for rehearing. Judge Eschbach voted to t the petition.

The petition is accordingly denied. A judge in ac-

tive service requested a vote on the suggestion 0 rehear-

ing en banc. In light of the amended opinion of the panel

filed today, the s stion of rehearing en bane did not

secure a majority. Judges Posner, Coffey, Easterbrook,

and Manion voted to grant rehearing en banc. Judge Wood

did not participate in the consideration or decision of this

case.

EasTersroox, Circuit Judge, with whom POSNER,

Correy, and Manion, Circuit Judges, F ag dissenting

from the denial of rehearing en banc.* panel’s opin-

ion. as amended, holds that Ill. Rev. Stat. ch. 8 §37-%c)

does not authorize the Illinois Racing Board to conduct

administrative searches of living cubicles at race tracks.

Then it declares Thoroughbred R 322 and Harness Racing

Rule 25.19 unconstitutional on two grounds: warrantless

searches unauthorized by statute bear a special burden

of justification, and the regulations do not contain stan-

dards to guide the discretion of the administrative officials.

All of the track's backstretchers consented to the searches,

but the court says that the consents are invalid because

the state did not have the authority to search over objec-

* Senior Circuit Judge ESCHBACH, alt h ineligible to vote on

the suggestion of rehearing en banc, joins is opinion as an expla-

nation of his vote in favor of rehearing by the panel

A-21

tion. Finally, the court deals with searches of the back-

stretchers’ persons at the track. Having made so much

of its conclusion that §37-{c) authorizes the search of busi-

ness premises but not living cubicles, the panel nonethe-

less holds that “the same rules apply” to searches con-

ducted on the business premises.

If the panel had said: “Searches of living quarters and

persons require either a warrant or some criteria limiting

the discretion of the officers, criteria Illinois does not

supply”, this would be a plausible though problematic

disposition. New York v. Burger, 55 U.S.L.W. 4890 (U.S.

June 19, 1987), holds that police may search regulated

businesses (in Burger auto junkyards) without a warrant,

a regular pattern, or any announced criteria. The Court

rejected a claim that the searches must be predictable,

pointing out that to the extent people can tell when the

police will arrive, they can use \..at knowledge to hide

evidence of wrongdoing. 55 U.S.L.W. at 4891 n.2, 4895-96

& nn. 21, 22. Bu not use the Ps gaye of Bionic

Auto Parts & , Inc. v. Fahner, 721 F.2d 1072 (7th

Cir. 1983), another junkyard case on which the panel heavi-

ly relied. See 808 F.2d 601, 604-06. Bionic said that each

ion must be justified and conducted to “minimize

the dangers” of random searches (721 F.2d at 1079); Bu

held that only the program of searches requires justifica-

tion, and that particular searches do not need additional

support. But Burger does not deal with searches of per-

sons and living quarters located on business premises, and

sooner or later the Court will have to do so. The Board

can amend its rules and avoid the difficulty, or press on

to the only Court that can resolve the issue. We could

add little by yi to apply Burger and similar cases to

the searches of living quarters and backstretchers.

But the —_— did not stop with the observation that

searches of persons and their living quarters are different

from searches of the rest of the business premises; it did

not even start there. It started by ing an independent

decision on a question of state law, as if the state were

just another litigant. It used the conclusion about state

A-22

law as a basis of its constitutional decision. This approach

is highly questionable. So is the panel’s treatment of con-

sent. The panel’s approach to the interpretation of state

laws could govern many cases, as would its handling of

consent. Long after Ill. Rev. Stat. ch. 8 §37-9c), Thorough-

bred Rule 322, and Harness Racing Rule 25.19 have been

amended or forgotten, we will have to live with the prin-

ciples the majority used. These principles deserve more

attention than they have received.

1. If the backstretchers had filed a suit under the

diversity jurisdiction seeking judicial review of the rules

on the ground that they are unauthorized by statute, the

suit would have been dismissed because the eleventh

amendment deprives the district court of authority to ad-

judicate such suits. If the backstretchers had filed a suit

under 42 U.S.C. $1983 and added a pendent claim under

state law, they still would have lost. Pennhurst State

School & Hospital v. Halderman, 465 U.S. 89 (1984) (Penn-

hurst IT), holds that a federal court may not award relief

against a state on the basis of state law. As the Court

said, “it is difficult to think of a greater intrusion on state

sovereignty than when a federal court instructs state of-

ficials on how to conform their conduct to state law.” 465

U.S. at 106. Yet that is exactly what the panel has done.

It has concluded that the Board does not understand state

a used that as the springboard of its constitutional

olding.

The panel’s award of relief was not based directly on

state law. So the panel may take comfort from Ex parte

Young, 209 U.S. 123 (1908). But Pennhurst II depends

not on the eleventh amendment but on principles of im-

munity that have developed in the shadow of that amend-

ment. It establishes the proper role of federal courts in

telling state governments the meaning of state law. That

a federal court Ss constitutional power to revise

a state’s view of the state’s law does not imply that the

court should do so. Four justices, dissenting in Pennhurst

II, argued that a state, with its choice of poison, would

prefer to lose on state rather than constitutional grounds,

A-23

and that a federal court does well to avoid the constitu-

tional issue. 465 U.S. at 159-63 (Stevens, J., dissenting).

The Court nonetheless rejected this position. No justice

in Pennhurst II suggested that a court should use state

statutory grounds to create a constitutional problem on

which the state then would lose. In Pennhurst II resort

to state grounds would have obviated a federal issue; in

this case, the panel’s holding on state law set the state

up for a fall on a federal issue.

There are at least five ways to find out what state law

means in a case like ours. One is to accept the view of

the executive branch of the state. A second is to certify

the question to the supreme court of the state. A third

is to abstain, as Judge Eschbach urged in dissent from

the panel’s opinion. A fourth is to review the issue of

state law with at least the deference given the statutory

interpretations of federal agencies. A fifth is to decide the

meaning of the law de novo, as if this were a dispute be-

ibe ager parties. The panel ignored three of these

me and brushed aside abstention, proceeding to give

its views on the meaning of state law unencumbered by

deference to the state’s interpretation. This is no way to

treat state governments.

I suggested in Huggins v. Isenbarger, 798 F.2d 203,

207-09 (7th Cir. 1986) (concurring opinion), that the best

approach is the first: to accept the position of the State

of Illinois on the meaning of the state’s law. The Illinois

Racing Board interpreted Ill. Rev. Stat. ch. 8 §37-9%c)

when it issued its rules. The Attorney General of Illinois

filed a brief in this court representing that the Board’s

construction of state law is correct. No state court has

questioned this. The State of Illinois thus has presented

us with an authoritative construction of its law. If the

state had spoken through the Supreme Court of Illinois,

we would treat the court’s interpretation as beyond our

ken; we would accept it merely because the court had said

it. Why should we listen only to state courts and ignore

the views of other officials of the state? Many construc-

tions of law come from courts, but courts pronounce only

A-24

when necessary to decide cases; executive officials con-

strue laws for other purposes, cf. Carson v. Block, 790

F.2d 562, 565 (7th Cir. 1986); Mother Goose Nursery Schools,

Inc. v. Sendak, 770 F.2d 668 (7th Cir. 1985). When ex-

ecutive officials are authorized to construe the law, they

speak for the state as authoritatively as courts do. Unless

a federal court may choose who speaks for the state, the

court ought to respect the views of whoever has spoken

for the state. Cf. Hilton v. Braunskill, 107 S. Ct. 2113,

2120 (1987); Ohio Bureau of Employment Services v. Hodory,

431 U.S. 471, 477-80 (1977); Barrera v. Young, 794 F.2d

1264, 1269 (7th Cir. 1986). How Illinois apportions govern-

mental powers, including the power to construe statutes,

is none of our concern. Whalen v. United States, 445 U.S.

684, 689 n.4 (1980); Mayor of Philadelphia v. Educational

Equality League, 415 U.S. 605, 615 n.13 (1974); Highland

Farms Dairy, Inc. v. Agnew, 300 U.S. 608, 612 (1937);

Prentis v. Atlantic Coast Line Co., 211 U.S. 210, 225

(1908); Dreyer v. Illinois, 187 U.S. 71, 84 (1902); United

Beverage Co. v. Indiana Alcoholic Beverage Commission,

760 F.2d 155 (7th Cir. 1985). Cf. City of Newport v. Iaco-

bucci, 107 S. Ct. 383, 385-86 (1986). Illinois has supplied

us with an interpretation of its statute, which we should

accept unless set aside by processes sufficient under the

law of Illinois.

Perhaps the Attorney General is not authorized by state

law to speak for Illinois. We should give the views of the

executive branch the sort of respect provided by state

law. National Surety Corp. v. Midland Bank, 551 F.2d

21, 26 (3d Cir. 1977). Thus if the Attorney General’s status

as an advocate diminishes the force of his views, or if the

Attorney General’s view is trumped by that of a court,

we should respect that allocation of governmental powers.

Huggins, 798 F.2d at 208-09. But it is commonplace for

courts to defer to the views of federal agencies and of

the Solicitor General of the United States—even when

those views are advanced during litigation. E.g., Japan

Whaling Ass’n v. American Cetacean Society, 106 S. Ct.

2860, 2867-68 (1986); Haig v. Agee, 453 U.S. 280, 291

A-25

(1981). States, which need not adopt the same separation

of powers found within the federal government, may give

greater force to statutory interpretations of executive of-

ficials. The parties have not addressed the extent to which

the Board’s, and the Attorney General’s, construction of

§37-9(c) is authoritative under state law. We certainly

ought not assume, as the panel does, that it is worthless.

In Pennhurst II the plaintiffs relied on an opinion of the

Supreme Court of Pennsylvania, which the court of ap-

peals held showed that the legal position of the executive

branch of Pennsylvania was untenable. The Supreme Court

held that even the views of the highest court of Pennsy]l-

vania did not allow a federal court to override the execu-

_tive branch’s construction of Pennsylvania law. Why may

we disagree with the executive branch of Illinois when

no state court has spoken?

Certification of the state law question would be one way

to avoid this difficulty—at least when the eleventh amend-

ment is not in play, see Citizens for John W. Moore Party

v. Board of Election Commissioners, 781 F.2d 581, 584-86

(7th Cir. 1986) (dissenting opinion)—but the panel did not

certify the question. Abstention is another way to obtain

the views of the state courts. The panel in our case de-

clined to abstain, pointing out that abstention disrupts the

progress of the case and is not a sound way to proceed

when raised belatedly. Yet the high costs of abstention

do not explain why the panel did not certify the ques-

tion. Certification entails neither the costs nor the delay

associated with abstention and is appropriate when the

statute is susceptible of multiple interpretations. Houston

v. Hill, 55 U.S.L.W. 4823, 4828-29 (U.S. June 15, 1987).

Surely either is preferable to holding an entire adminis-

trative scheme unconstitutional because unsupported by

state law. Even belated abstention is attractive if the

alternative is the federal court’s substitution of its judg-

ment for the state officials’.

There is one more option: deference to the state agency’s

construction of state law, as we weuld defer to a federal

agency’s construction of federal law. If the Board’s rules

A-26

had been issued by a federal agency, we would have asked

not whether the construction is right but whether it is

reasonable. See Chevron U.S.A. Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837, 842-45, 862-66 (1984);

Watkins v. Blinzinger, 789 F.2d 474, 478 (7th Cir. 1986).

The regulations were promulgated under a law giving the

Board authority to inspect the “race track, facilities and

other places of business” of the licensees. The panel says

that the Board may not inspect the living cubicles at the

track because “other places of business” “effectively

defines the earlier listed places as places of business.”

This is the eiusdem generis approach. A reasonable per-

son might deny the applicability or force of this saw, see

Harrison v. PPG Industries, Inc., 446 U.S. 578, 587-89

(1980); United States v. Turkette, 452 U.S. 576, 581-82

(1981), but even if applicable this canon does not answer

all questions. The cubicles are part of the “race track [and]

facilities” of the racing licensee, and they promote the

operation of the racing business. Licensees make quarters

available at the track for their convenience, not because

they want to operate apartment houses. The backstretchers

may regard the cubicles as residences, but the licensees

regard them as part of the track complex. The statute

authorizes the Board to inspect the facilities, track, and

business of the licensees; that the licensee’s place of busi-

ness is someone else’s hotel room does not necessarily con-

fine the Board’s statutory power. Cf. United States v.

Cerri, 753 F.2d 61 (7th Cir. 1985) (agents may search a

gun dealer’s home without a warrant, if he chooses to do

business at home). As in Chevron, the legislature does

not appear to have considered, and therefore it has not

settled, the problem at hand.

There is, moreover, a different way to read the statute:

it authorizes inspection of the track proper, and of “other

places of business’’ away from the track. Racing licensees

do not use the tracks year ’round; sometimes more than

one licensee uses a track; every licensee has some place

of business away from the track. The function of the

“other places of business” language then is not to close

A-27

some portions of race tracks to the Board but to ensure

that the Board can follow the business wherever the licen-

see goes. This reading is consistent with the reasons the

Board is authorized to inspect. Papers suggesting impro-

prieties may be hidden anywhere the licensee may be

found; drugs given to horses may be hidden at the track

and elsewhere. It would be most surprising if the Board

may not inspect at least every corner of the race track

proper for drugs, forbidden implemeuts, and suspicious

papers. Yet under the panel’s decision, the licensee can

put part of the track off limits by the expedient of in-

viting an employee to sleep there. That is not an in-

evitable reading of the statute, one so compelling that we

would say that a federal agency exceeded its power in

reading the statute to embrace the whole track. The panel

treated the meaning of “‘race track [and] facilities’ as a

pure question of law on which it could take a clear shot.

It is not appropriate for a federal court to give less defer-

ence to a state agency’s interpretation of a state statute

than to a federal agency’s interpretation of a federal stat-

ute; the distinction cuts the other way.

2. The panel scrutinized the statutory authority for the

Board’s rules because it believed that searches are more

readily sustained if conducted on statutory authority.

Maybe so for searches by federal officials, because a fed-

eral court should respect Congress’ decision that a cate-

gory of searches is “reasonable”. United States v. Watson,

423 U.S. 411, 416 (1976). But because states need not ob-

serve the separation of functions that prevails within the

federal government, they may entrust to executive of-

ficials the task of deciding for the political branches what

is reasonable. No case I have found even hints that a

search by a state official, under color of state regulations,

is any different for constitutional purposes from a search

under color of a state statute; indeed the distinction be-

tween “statute” and “regulation” presupposes a sepa-

ration of functions that states are free to modify. Many

cases sustain state searches, conducted on administrative,

regulatory, or no authorization, without suggesting that a

A-28

statute would have supplied a firmer base. E.g., O’Connor

v. Ortega, 107 S. Ct. 1492 (1987); Colorado v. Bertine, 107

S. Ct. 738 (1987). See also McDonell v. Hunter, 809 F.2d

1302 (8th Cir. 1987), and Shoemaker v. Handel, 795 F.2d

1136 (3d Cir. 1986), both sustaining administrative searches

that were supported entirely by regulations. The fourth

amendment does not allow administrative officials to issue

warrants but is otherwise silent on who makes policy for

Illinois concerning administrative searches. Illinois v.

Krull, 107 S. Ct. 1160 (1987), holds that evidence gathered

under authority of a state statute later declared unconsti-

tutional may be used in a criminal case, but this is based

on considerations peculiar to the exclusionary rule rather

than on a belief that legislation is better than a regula-

tion at declaring the policy of Illinois about the propriety

of administrative searches. State regulations and state

statutes should have equal weight when the question is:

“what does society believe is a ‘reasonable’ administrative

search?”’.

At all events, the searches of the backstretchers’ per-

sons at the track are authorized by both statute and

regulation; the track (outside the backstretchers’ cubicles)

is a place of business of the licensee, so the regulation

is authorized even on the panel’s treatment of §37-9(c).

This search has all the support the State of Illinois as

a whole can furnish. The court has necessarily declared

§37-9(c) unconstitutional as applied to personal searches

at the track.

3. The backstretchers were required to consent to

searches as a condition of their employment. The panel’s

approach to these consents is to say that because the state

cannot search the backstretchers’ cubicles or persons

against their will, the state cannot require consent either.

This has the curious consequence that consent is valid

whenever it is not needed (because the state may con-

duct the search without consent) and invalid whenever it

is necessary (because the state is forbidden to search over

objection). This eliminates consent as a ground for search.

A-29

Although the panel does not articulate its rationale, it

must be making an “unconstitutional conditions” argu-

ment. The state did not ask for consent, as in Schneckloth

v. Bustamonte, 412 U.S. 218 (1973). It made consent a

condition of employment. “Consent” extracted by threat

of a violation of one’s constitutional rights is not effec-

tive; it is no different from the proposal “your money or

your life’, because either option makes the person worse

off. Another panel of the court recently held that ‘con-

sent” extracted by a threat of disbarment is valid, see

Lewis v. Lane, 816 F.2d 1165, 1169 (7th Cir. 1987), and

I wonder how these decisions may be reconciled, but that

is not my principal concern.

Ours is not a simple “unconstitutional condition’. The

panel did not hold that administrative searches of back-

stretchers’ quarters and persons always violate the fourth

amendment. It has held only that the searches are unau-

thorized by statute and that the regulations are (so far)

insufficiently detailed. There has never been a doctrine

of “unstatutory conditions” or “insufficiently circumscribed

regulatory conditions”. Why can’t people be asked to con-

sent to a kind of search that the statute has not yet au-

thorized?

Moreover, the state demands consent only from those

who live or work at the track. Employees are free to live

elsewhere and avoid searches of their quarters. This is one

of the grounds on which courts sustain airport searches:

you can’t board a plane without consenting to a search,

but you can travel by car or train if you like. So too at

the track. The demand is not unconditional; the employee

controls the security of his quarters by his choice of

abode. The panel’s decision casts a pall over all consents

in which the choice is genuine because the person has a

right to say no by choosing another line of work, another

place to live, a different mode of travel, and so on.

Some recent cases call the unconstitutional conditions

doctrine itself into question. Snepp v. United States, 444

U.S. 507, 509 n.3 (1980), holds that an employee may sur-

render by contract his first amendment right to speak;

A-30

the Court did not think it important that the consent was

required as a condition of employment. Buckley v. Valeo,

424 U.S. 1, 54-58 & n.62 (1976), holds that the govern-

ment may condition monetary support for political cam-

paigns on a surrender of the constitutional nght to spend

unlimited sums for speech. Posadas de Puerto Rico Asso-

ciates v. Tourism Co. of Puerto Rico, 106 S. Ct. 2968,

2979 (1986), uses the principle that the greater power (to

ban gambling) includes the lesser power (to condition a

gambling permit on surrender of some first amendment

rights). ‘““The greater power includes the lesser’’ is the

traditional antagonist of the “unconstitutional conditions”’

principle. An inferior federal court may not proceed as if

ost doctrine of unconstitutional conditions were in perfect

ealth.

Neither the panel’s proposition that consent is ineffec-

tual when the government lacks the power to impose its

will over objection, nor the contrasting view of Lewis that

knuckling under to a show of authority is voluntary, is

very attractive. To determine whether acquiescence in the

face of a demand is significant, we must evaluate the

nature and strength of the reasons for the demand (as

the Supreme Court did in Snepp), the options open to the

person faced with the demand (here to obtain quarters

off the track’s premises or to change jobs), the extent to

which the scope of any consent is reasonable in light of

the purposes to be served, and so on. Many cases say

that the government may demand consent when it has

strong reasons. The airport search cases are good ex-

amples. Searches at race tracks also vindicate important

interests. The panel did not deny that the government

has a substantial interest in keeping drugs away from

horses (and jockeys, see Shoemaker, 795 F.2d at 1141-43);

it apparently did not believe that the strength of the

state’s interest is relevant. When there are strong reasons

for conducting a search, when the demand affects only

a tiny portion of the jobs available in the state (so that

saying no and changing jobs is a real option), when the

consent approves a search that fits the need like a glove—

__

A-31

in short, in this case—the state may use the consent even

if it may not act over objection.

If the backstretchers’ consents are valid, then the state

may carry out its searches even if the Board’s regula-

tions do not sufficiently confine the agents’ discretion. And

if these regulations are inconsistent with the fourth amend-

ment, our court ought to give the right reasons for that

conclusion. The panel’s opinion does not give Illinois the

deference in the interpretation of state law that is its due,

and the panel’s preference for legislation over regulation

requires the state to conform its governance to the panel’s

views of how states ought to be organized. The questions

of principle glossed over by the panel’s opinion are far

more important than the outcome of this case, and they

i the extra judicial time necessary to get them

right.

A true Copy:

Teste:

~ Clerk of the United States Court of

Appeals for the Seventh Circuit

y,

B-1

APPENDIX B

IN THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

No. 85-2393

Don SERPAS, RAYMOND JOHNSON and CARL WATERS, in

dividually and on behalf of all others similarly situated,

Plaintiffs-Appellees,

v.

CHARLES E. SCHMIDT, et al.,

Defendants-Appellants

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Divieton

No. 8 C 4715—Charies P. Kecoras, Judge

ARGUED APRIL 2, 1986—Decipep Decemaer 19, 1986

Before CuDAHY and RIpPLe, Circuit Judges, and

ESCHBACH, Senior Circuit Judge.

CuDAHY, Circuit J . Plaintiffs brought this suit, in-

dividually and on behalf of all exercise persons,

and hot walkers (collectively, “backstretchers”) at Illinois

race tracks, seeking declaratory and injunctive relief from

certain investigative practices authorized by the Illinois

Racing Board (the “ ") and carried out by the Illi.

nois Department of Law Enforcement (“IDLE”) on the

ground that these practices violated the Fourth Amend

ment, as applied to the State of Illinois through the Four

teenth Amendment. The challenged practices included

warrantless searches of the backstretchers’ on-track dorm

—

i th Ur A HIN:

: He Hemme ce i

el a a mite ; i it elie

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He i | eet il

nee i i i

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nite zea i

ne iy! alle

hee

B-4

ployee of a licensed operator, in accepting his employ-

ment, and each vendor who is permitted to sell and

distribute his merchandise within the race track en-

closure, does thereby irrevocably consent to such

search as aforesaid and waive and release all claims

or possible actions for damages they may have by

virtue of any action taken under this rule.

in who refuses to be searched pursuant to this Tule

may have his license suspe or revoked

(b) The Illinois Racing Board delegates the author-

ity to conduct i ns and searches, under this

rule, to the Chief Investigator of the Illinois Racing

Board and to Special Agents of the Illinois Bureau

of Investigation, or other designees of the Depart-

ment of Law Enforcement assigned, from time to

time, to assist the Chief Investigator in his duties.

The challenged searches were undertaken pursuant to this

regulation.

The Act also empowers the Board to prescribe applica-

tices thentn tnd tone femenne ts tented. ‘Rev.

feo’ e §§ 37-15, 37-20. Prior to the entry of the pre-

junction in this case, the license

ee el y the Board quoted the text of above

Rules and conditioned the license’s

resi-

dential quarters at Arlington Park Racetrack. Their resi-

dential quarters have been searched by IDLE agents;

they have also been stopped and personally searched by

' The affidavits submitted by the parties differed in some of the

ddan of Gn cohen ten Gate

g

IDLE — within the race track enclosure. No evidence

The pret rovwtenres Sg A ae = So ae

inti t when they signed the

license application forms, they consented to the searches.

They also admit that they consented to each of the searches

at the time it occurred. They claim, however, that they

would not have consented to these warrantless searches

if they had not been required to give consent in order

to remain in a job as a backstretcher.

On July 30, 1982, these three filed a complaint in the

jNorthern District of Illinois, naming as defendants pres-

ent and former members of the Board, the director of

IDLE and certain unknown IDLE agents and seeking in-

junctive and ae relief. On September 24, 1982,

a —-= a preliminary injunction, which was

granted in ew on June 16, 1983. This order of

quarters

ing or eS of Seaiatretehors

without a suspicion, on articulable facts,

activity; and (8) conditioning the issuance of occupation

licenses to backstretchers consent to these searches.

Serpas v. Schmidt, No. , mem. op. (N.D. Ill. June

On September 19, eee oes cortined Serves,

Johnson and Waters as named representatives of a class

eee ee ee

at Illinois race tracks. In August and October 1984, the

parties filed cross-motions for summary judgment. The

oi? tects Gal A a pemoeee oenetion oo Fuly

* motion and a permanent injunction on July

11, 1985. v. No. 82-C-4715, mem. op.

(N.D. Il. July 11, 1985). This appeal followed.?

* After oral argument, we asked the parties to provide us with

additional briefing on the question whether we should abstain and

(Footnote contunued on following page)

B-6

2 continued

permit the Illinois courts to rule on the state law issues in the

case, thus arguably mooting the federal constitutional questions.

See Railroad Commission of Texas v. Pullman Co., 312 U.S. 496

(1941). This question was first raised at oral argument in the

course of questioning by the panel.

After examining the supplemental briefs, we have concluded that

abstention is not appropriate in this case. As the dissent correct-

ly points out, this circuit has held that it might be proper in some

cases for an appellate court to order abstention even though

neither y had raised this issue. See Waldron v. McAtee, 723

F.2d 1348, 1351 (7th Cir. 1983). However, we do not think that

it would be appropriate for us to order abstention swa sponte here.

In the controversy before us, the federal courts are not “the lone

guardian of the state’s sovereign place under the Constitution,”’

infra p. 17; the defendants are state officials who raised no ob-

jection to having the claims against them litigated in federal court

until this court itself raised the abstention issue. See Mazanec v.

North Judson-San Pierre School Corp., 763 F.2d 845, 848-49 (7th

Cir. 1985) (State defendants did not request abstention until the

end of trial; this is “an independent argument against abstention.”

“{I}f the responsible state officials are willing to litigate the case

in federal court, that court does not have to force it back into state

court.””) (emphasis in original) (citation omitted).

In addition, there is a presumption in this circuit against abstain-

ing once a case has gone to trial; this presumption holds at least

“where neither party requested abstention before trial.” Mazanec,

763 F.2d at 847. The district court in this case granted the plain-

tiffs’ motion for a hago injunction in 1983 and enjoined the

searches permanently in 1985 on plaintiffs’ motion for summary

judgment. The defendants did not raise an abstention issue dur-

ing any of these proceedings, nor did they raise it before us. The

dissent contends that Mazanec is not applicable to this case

because Mazanec states that the presumption against abstainin

may be rebutted if the state statute at issue could be interpre

narrowly and thus survive a constitutional challenge. /nfra p. 16

n.3. We believe, however, that the resolution of the constitutional

issues in this case might well be nece even if a state court

found that the Act did not authorize the Rules. If the plaintiffs

had validly consented to the searches or if they had a reduced

expectation of privacy, it certainly could be argued that the defen-

dants would not have needed an independent basis of authority

under state law to conduct the searches. Thus, abstention might

not produce a state law result which would be dispositive of the

claims under the federal Constitution.

B-7

II.

A. Warrantless Searches of Dormitory Rooms

The Fourth Amendment protects against “unreasonable”’

searches and seizures. The reasonableness of a search de-

pends upon a person’s expectation of privacy in the“place

to be searched, provided that that expectation is one that

society is willing to recognize as “reasonable.’”’ Katz v.

United States, 389 U.S. 347, 361 (1967) (Harlan, J., con-

curring). Appellants contend that the backstretchers’ as-

serted expectation of privacy in their on-track dormitory

rooms is not the sort of expectation that society recog-

nizes as reasonable. They rely on historic state regula-

tion of the horse-racing industry, the less than commodi-

ous quality of the on-track quarters and the backstretchers’

implied consent to the searches.

We have no doubt that horse racing is and ought to

be a pervasively regulated industry. But a history of per-

vasive regulation of an industry is not by itself enough

to render the warrant requirement superfluous. As we

noted in Bionic Auto Parts and Sales, Inc. v. Fahner,

721 ¥'.2d 1072, 1079 (7th Cir. 1983),

the degree and extent of past regulation comprise but

a part, albeit a substantial part, of a determination

of a “reasonable expectation of privacy” under the

Fourth Amendment. Otherwise, no protections at all

would be appropriate in closely regulated industries.

The Fourth Amendment requires that a determina-

tion of the “reasonableness”’ of the intrusion be made.

Even in closely regulated industries, the inspection

provisions still must be tailored to the state’s proper

objectives, and they must minimize the dangers in-

herent in the unbridled exercise of administrative dis-

cretion.

It is certainly true, as appellants point out, that the

Supreme Court has sanctioned warrantless searches of

commercial premises in certain industries subject to long-

standing governmental oversight. Donovan v. Dewey, 452

U.S. 594 (1981) (mining); United States v. Biswell, 406 U.S.

311 (1972) (firearms); Colonnade Catering Corp. v. United

B-8

States, 397 U.S. 72 (1970) (alcoholic beverages). In each

of these cases, however, an act of Congress expressly au-

thorized the terms and conditions of searches on specified

premises. The rationale for not requiring a warrant in

such a situation is that a statutory inspection program

“in terms of the certainty and regularity of its applica-

tion, provides a constitutionally adequate substitute for

a warrant.” Dewey, 452 U.S. at 603. In that way, there

is assurance that the individual’s privacy interest and the

government’s interest in law enforcement are properly

balanced. See Marshall v. Barlow’s, Inc., 486 U.S. 307,

321 (1978) (‘“‘The reasonableness of a warrantless search

. .. will depend upon the specific enforcement needs and

privacy guarantees of each statute.”’).

The statutory authority claimed by the appellants for

the searches challenged here states that the Board and

its delegates are “‘vested with the power to enter the of-

fice, horse race track, facilities and other places of busi-

ness’’ of any licensee to ensure compliance with the Act.

Ill. Rev. Stat. ch. 8, § 37-%c). Appellants contend that the

dormitory rooms are “facilities” for purposes of the Act.

We agree with the district court that this is not a reason-

able reading of the statutory language. The provision spe-

cifically lists a series of places, ending with the catch-all

“other places of business.” This concluding phrase effec-

tively defines the earlier listed places as places of busi-

ness. The statute in no way suggests that a residence may

be searched.

We agree with the district court that these on-track

dormitory rooms must be considered the backstretchers’

“homes” for Fourth Amendment purposes. Appellants

point out that the rooms are very small and located either

adjacent to or above the stables in the backstretch of the

track. Further, they are only temporary lodgings and are

accessible to track authorities by a master key. Nonethe-

less, they are exclusively residential, and lodgings as

cramped, inhospitable or temporary have been considered

residences by the courts. See Stoner v. California, 376

U.S. 483 (1964) (hotel rooms); McDonald v. United States,

B-9

335 U.S. 451 (1948) (rooming houses); Smyth v. Lubbers, _

398 F. Supp. 777 (W.D. Mich. 1975) (college dormitories).

There is no evidence that the backstretchers conduct any

of their business in the rooms; thus, cases such as United

States v. Cerri, 753 F.2d 61 (7th Cir.), cert. denied, 105

S. Ct. 3479 (1985), where petitioner conducted his gun

business out of his home, are distinguishable. Given the

historical legal protection afforded the home by the Fourth

Amendment, see, e.g., United States v. United States

District Court, 407 U.S. 297, 313 (1972) (‘‘physical entry

of the home is the chief evil against which the wording

of the Fourth Amendment is directed’’), we will not as-

sume that the Illinois legislature means to authorize war-

rantless residential searches unless it clearly states this

intention.

There is no reason to doubt that drugs and mechanical

devices pose major threats to the integrity of the horse

racing industry. Nor do we question the reality of the

Board’s concerns about protecting horse racing without

broad powers of surveillance over backstretchers and

others. But the Fourth Amendment requires regularity

of application and an impartial assessment of reasonable-

ness, and these will be lacking when there is no adequate

basis for regulatory searches in the controlling statute.

Here, there is simply no authority for adopting a set of

practices, significantly involving searches of residences and

of the person, merely by publishing regulations that have

no clear tie to the statute.

Even without explicit statutory authorization for these

searches, the appellants contend that sufficient certainty

of application to serve as a substitute for a warrant can

be found in the regulatory scheme taken as a whole. We

disagree. First, the Supreme Court has placed great weight

on legislative determinations of the necessity for warrant-

less searches, see Dewey, 452 U.S. at 600 (“[A] warrant

may not be constitutionally required when Congress has

reasonably determined that warrantless searches are neces-

sary ....’’); Biswell, 406 U.S. at 315 (legality of search

depends on ‘‘authority of a valid statute’’); Colonnade, 397

B-10

U.S. at 76-77 (stressing Congress’ reasonable exercise of

its broad authority to regulate liquor industry). Even so,

to satisfy the “certainty and regularity” requirement, an

“inspection program must define clearly what is to be

searched, who can be searched, and the frequency of such

searches.” Bionic Auto Parts, 721 F.2d at 1078. The rules

under which the IDLE agents operated do not impose any

meaningful limitations on their discretion. As the district

court noted,

The searches may be focused or random and are not

restricted to particular times nor restricted to par-

ticular areas or items in those areas which are in

piain view... . [T]he agents . . . may search plain-

tiffs’ living quarters and personal effects as exten-

sively as they wish. Plainly, the agents have an un-

restricted scope of search; requiring them to hand

out receipts or consent forms does not affect or limit

the agent’s discretion to undertake an exhaustive search

of every personal effect in an individual’s room.

Serpas v. Schmidt, No. 82-C-4715, mem. op. at [8] (N.D.

Ill. July 11, 1985). The regulatory scheme here thus falls

short of adequately substituting for a warrant. As the

Supreme Court explained in rejecting a warrantless search

scheme in Camara v. Municipal Court, 387 U.S. 523,

532-33 (1967), “(t]his is precisely the discretion to invade

private property which we have consistently circumscribed

by a requirement that a disinterested party warrant the

need to search.” Hence, we agree with the district court

that neither the statute nor the regulatory scheme here

is sufficient to except these searches from the general rule

that searches conducted’ without the safeguard of a war-

rant are unreasonable and violate the Fourth Amendment,

see Johnson v. United States, 333 U.S. 10, 13-14 (1948).

Finally, the appellants argue that the backstretchers im-

pliedly consented to the searches by accepting occupation

licenses conditioned upon compliance with Rules 322 and

25.19. We think that the district court approached this

contention properly when it noted that “the issue is not

whether consent can be implied, but whether, absent the

B-11

condition, the challenged searches are constitutional.’’ Ser-

pas v. Schmidt, No. 82-C-4715, mem. op. at [11-12] (N.D.

Ill. July 11, 1985). While it is true that those who enter

highly regulated fields do so with notice of an adminis-

trative search scheme and that this affects their expec-

tation of privacy, see Dewey, 452 U.S. at 600 (when reg-

ulation sufficiently comprehensive, owner “cannot help but

be aware that his property will be subject to periodic in-

spections undertaken for specific purposes”), it is also

clear that ‘“‘the legality of the search depends not on con-

sent but on the authority of a valid statute.’”’ Biswell, 406

U.S. at 315. As we have noted, these searches, standing

alone, are unconstitutional. The Board may not issue a

license conditioned simply on the applicant’s consent to

waive a constitutional right. See, e.g., Cole v. Richard-

son, 405 U.S. 676 (1972) (public employment may not be

conditioned on waiver of First Amendment rights); Spevack

v. Klein, 385 U.S. 511 (1967) (license to practice law may

not be conditioned upon waiver of Fifth Amendment

rights); Armstrong v. New York State Commissioner of

Correction, 545 F. Supp. 728 (N.D.N.Y. 1982) (employment

as prison guard may not be conditioned upon waiver of

Fourth Amendment rights). The district court also cor-

rectly ruled that the fact that the named plaintiffs actually

consented to each search before it was performed is irrele-

vant given the posture of this case. Whether or not plain-

tiffs consented to these searches in the past, their status

as licensees subjects them to the threat of searches in

the future.

B. Warrantless Searches of the Backstretchers

The district court also enjoined the Board and IDLE’s

practice of conducting warrantless stops and searches of

the backstretchers’ persons within the race track enclosure.

Appellants have not suggested that we should analyze the

personal searches any differently from the residential

searches, and we, too, think that the same rules apply.

Like searches of property, searches of the person are

generally impermissible absent a warrant issued upon a

determination of probable cause. New York v. Belton, 453

B-12

U.S. 454, 457 (1981); Mary Beth G. v. City of Chicago,

723 F.2d 1263, 1268 (7th Cir. 1983). The deficiencies we

have noted in the statute and regulatory scheme apply

equally to these personal searches, and the arguments

based upon consent are equally unpersuasive in this

context.

As we have noted, we are certainly not unsympathetic

to the appellants’ argument that extraordinary surveillance

procedures are necessary to preserve the integrity of

horse racing. The simple fact is, however, that the Illinois

statute falls far short of providing an adequate basis for

the extraordinary procedures undertaken here.

For the foregoing reasons, the judgment of the district _— |

court 1S AFFIRMED. |

rs

|

° Appellants argue that we are bound to reverse the district court

on the authority of the Supreme Court’s summary affirmance of

the unpublished decision of a three-judge e in Wilkey v. Illi- |

nois Racing Board, No. 74-C-3524 (N.D. Ill. 1975), aff'd, 423 U.S. |

802 (1975), In that case, the court upheld a Board rule that |

authorized a personal search of a licensee veterinarian in the |

backstretch of the track. Unpublished opinions have no preceden-

tial effect in this circuit. See Circuit Rule 35. Summeey sffirwences

by the Supreme Court do have some precedential effect, although

they affirm the lower court’s judgment only and not its rationale.

Summary affirmances “prevent lower courts from coming to op-

posite contlusions on the precise issues presented and necessarily |

decided by those actions.” Mandel v. B ,, 432 U.S. 173, 176

(1977). Wilkey involved a challenge by a Board-licensed veterinarian

to Rule 322. He had lost his license after refusing to consent to

a personal search. Precedential effect “is to be assessed in the

light of al} of the facts [of the) case,” id. at 177, and Wilkey is

distinguishable, notably in that the Board argued that there was

probable cause to search Wilkey. Further, we note that the Court

affirmed Wilkey before its more recent pronouncements on the

limits of the administrative search exception, Marshall v. Barlow’s,

Inc., 436 U.S. 307, and Donovan v. Dewey, 452 U.S. 594. In light

of these factors, we do not think we are bound by the Supreme

Court’s summary affirmance in Wilkey.

B-13

ESCHBACH, Senior Circuit Judge, dissenting. The fed-

eral courts should abstain from deciding this case to pro-

vide the state courts of Illinois an opportunity to construe

the state statute at issue, thus potentially significantly

altering or entirely mooting the constitutional inquiry.

Thus, while I have no particular objection to the constitu-

tional jurisprudence set forth in the majority opinion, I

must dissent.

The challenged searches in the instant case were author-

ized by the Illinois Racing Board (the ‘“Board”) under

Thoroughbred Rules 322 and 25.19 (the “Rules’’), and

were purportedly issued under the authority of the Horse

Racing Act of 1975, as amended (the “Act’’), Ill. Rev.

Stat. ch. 8, § 37-9 (Smith-Hurd Supp. 1986). After under-

going searches of their persons and rooms at a racetrack

pursuant to these Rules, the plaintiffs filed an action in

federal district court, claiming a violation of 42 U.S.C.

§ 1983 (1982), and requesting damages as well as declar-

atory and injunctive relief.1 The district court denied dam-

ages but issued a permanent injunction prohibiting defen-

dants from enforcing the Rules via searches like those

challenged. The trial court also declared the Rules invalid

under the Fourth Amendment, a determination entirely

unnecessary on the record in this case. Only the decisions

on injunctive and declaratory relief have been challenged

on appeal.

This court has a duty under the narrow strictures of

Pullman abstention, Railroad Commission of Texas v.

Pullman, 312 U.S. 496, 61 S. Ct. 643 (1941), to maintain

1 Some justices have on occasion taken the position that Pullman

abstention ought not to apply to cases brought under the Civil

Rights Act, see, e.g., Harrison v. NAACP, 360 U.S. 167, 180-81,

79 S. Ct. 1025, 1032 (1959) (Douglas, J., dissenting, joined by Warren,

C.J., and Brennan, J.); Boehning v. Indiana State Employees

Ass'n, 423 U.S. 6, 8, 96 S. Ct. 168, 170 (1975) (Douglas, J., dissent-

ing), but that position has never commanded a majority of the

Court, and Pullman abstention remains applicable, see, e.g., Boehn-

ing, 423 U.S. at 6-8, 96 S. Ct. at 168-70 (per curiam).

B-14

the comity and ae | Ge to the Constitu-

tion by avoiding unnecessary friction with the state courts.

See, e.g., Harrison v. NAACP, 360 U.S. 167, 176, 79 S.

Ct. 1025, 1030 (1959) (Harlan, J.). We also have a duty

to avoid unnecessary constitutional adjudication. See, e.g.,

Ashwander v. Tennessee Valley Authority, 297 U.S. 288,

345-48, 56 S. Ct. 466, 482-83 (1936) (Brandeis, J., concurring).

The “paradigm of the ‘special circumstances’ ”’ that must

exist before invoking Pullman’s narrow exception to the

exercise of federal jurisdiction is ‘“‘a case where the chal-

lenged statute is susceptible of a construction by the state

judiciary that would avoid or modify the necessity of reach-

ing a constitutional question.”’ Babbitt v. United Farm

Workers National Union, 442 U.S. 289, 306, 99 S. Ct.

2301, 2313 (1979) (quoting with approval Kusper v. Pon-

tikes, 414 U.S. 51, 54, 94 S. Ct. 303, 306 (1973)); see also

Waldron v. McAtee, 723 F.2d 1348, 1352 (7th Cir. 1983);

City Investing Co. v. Simcox, 733 F.2d 56, 60 (7th Cir.

1980).

This is such a case. No Illinois court has yet addressed

the question of whether the challenged searches and Rules

under which they were made were beyond the authority of

the Act. The majority here and the district court below both

appear to believe the Rules invalid for precisely that rea-

son. If the Rules are invalid, the challenged searches,

which exclusively relied upon the Rules, are all also invalid,

and the case is concluded without constitutional adjudica-

tion. Every personal and residential search in this action

was performed by agents of the Illinois Department of

Law Enforcement (“IDLE”’), to whom the Board had dele-

gated the authority to enforce the Rules. On the record

in this case, the agents of IDLE claimed only the author-

ity of the Rules for every search challenged. No other

authority is claimed in the record to justify these searches.

Even the occupational licenses required of each worker

to gain employment were conditioned upon signing a con-

sent to searches under the authority of the Rules. While

the attorneys argued other authority to this court in their

briefs, those arguments are merely legal arguments con-

ne on the Rules, the validity

of the R is the only property before this court.

and it may well be decided by state law

searches the Act, see Hawant Housing A

v. Midkiff, Se. Ce. Sank, SIRT (1000 (hontinet penal

ity of a construction justifies abstention) Merruwon,

significant. possbit bility of ating construction: ‘ie

igni t we

Lynk, 789 2d at 568, for the Act does not or

apiely eae Se ee oe

eee eee Act would sagnificartly alter

if not entirely moot, the constitutional question. The

strong possibi of such a limiting construction should

ery Bed aed. oy AD. Any 4+

not ar 0 0 ee ent) eee ie own

law. Cf. Kusper v. Pontikes, 414 US. 51, ™ 5S. Cl. 2

(1973) (abstention improper because state law not suscep

tible of an interpretation that might avoid cometitwtional

adjudication), Harman v. Forssexims, 380 US. GOs, S840)

85 S. Ct. 1177, 1182 (1965) (eamek Board of Education

v. Bisworth, 713 F.2d 1316, 1321 (7th Cir, 1983) Game)

It might be argued that it is inappropriate to order

abstention at the appellate lewel when the ewe wae met

B-16

raised below or suggested by the parties on appeal.? But

we have recently held otherwise. In Waldron v. McAtee,

723 F.2d 1348 (7th Cir. 1983), we held that “‘the court

has the power and in an appropriate case the duty to

order abstention, if necessary for the first time at the ap-

pellate level, even though no party is asking for it.”’ Jd.

at 1351. Our duty is to the federalism inherent in the Con-

stitution, and we are thereby bound to respect the sover-

eignty of the states and to avoid unnecessary constitu-

tional adjudication.®

Procedural concerns bolster the argument for absten-

tion in this case. The purpose of legal procedure is to ex-

pedite the full and frank consideration of substantive legal

disputes. If the appellate courts do not order abstention

where it is appropriate simply because it was not raised

below, litigants will be encouraged to avoid abstention by

excluding crucial state issues from their pleadings. Such

a practice would place abstention largely in the hands of

the litigants, and in many cases the individual goals of

each litigant may counsel avoidance of abstention, thus

obscuring and perhaps emasculating the interests of the

sovereign states in the regulation of their own affairs.

When a case presents issues meeting the threshold require-

ments necessary to invoke the narrow doctrine of Pull-

2 We raised the potential applicability of abstention at the oral

argument on appeal, and the parties then filed briefs on the issue

at our request.

3 We recently held in Mazanec v. North Judson-San Pierre

School Corp., 763 F.2d 845, 848 (7th Cir. 1985), that a trial court

had abused its discretion by ordering abstention subsequent to the

date trial was concluded, and three years after litigation was com-

menced. Mazanec itself distinguished Waldron by noting that in

Waldron there was a significant possibility that the statute would

be held unconstitutional as it stood, but that the state might

“save” it by limiting it to pass constitutional muster. Jd. at 848.

The facts at bar are similar to Waldron; a state court’s interpreta-

tion of the Rules and the Act might avoid the necessity of strik-

ing down a state law or regulation on constitutional grounds. Thus

Waldron is the appropriate precedent to apply to the case at bar.

<="

B-17

man abstention, the court may be the lone guardian of

the state’s sovereign place under the Constitution. We

should not shirk that duty.

The majority suggests in a footnote that even if the Act

does not authorize the challenged searches, we would still

be required to reach the defendants’ constitutional argu-

ments based on the plaintiffs’ consents to the searches.

I do not agree. The Board conditioned the granting of

employment licenses upon consent to the Rules, and the

district court found that the employees’ individual con-

sents at the time of each search were given under the

threat of dismissal based upon the authority of the Rules.

The invalidation of the Rules would preclude any future

search based upon consent to the Rules, and would pre-

vent the use of consent forms requiring consent to such

searches under the authority of the Rules. If the Rules

no longer exist, searches may not be based on their au-

thority.

It should also be noted that even with the Rules and

consents invalidated, the plaintiffs would still have to show

the trial court that they continued to meet the threshold

requirements necessary to support an injunction. While

the district court found that “in the absence of perma-

nent injunction, they [the plaintiffs] will continue to have

their houses and persons searched without a warrant,”

it apparently did not consider the effect invalidating the

Rules would have on police behavior. It is pure specula-

tion to posit that the agents of IDLE would continue

these searches subsequent to the invalidation of the Rules;

indeed, the agents conducted the personal and residen-

tial searches in the backstretch area only in reliance upon

the validity of the Rules, as the record shows. There are

no findings regarding this crucial point in the district

court’s opinion, and this silence highlights the fundamen-

tal weakness in the majority’s opinion: the validity of the

searches absent the Rules was not presented to the dis-

trict court under the record in this case, and should not

be at issue before this court.

B-18

The majority also contends that the invalidity of the

Rules would not dispose of the defendants’ constitutional

argument based upon a reduced expectation of privacy

due to pervasive government regulation of the horse racing

industry. I disagree. The pleadings do not place this de-

fense in issue except in reference to the validity of the

Rules. Throughout this action, neither party has raised

the argument that the searches were authorized in the

absence of the Rules.4 While the parties may have in-

tended or hoped to put such a theory into this case by

their briefs to this court, the record here does not do so,

and this court is not at liberty to resolve issues not pre-

4 In their answer the defendants pleaded that sections 37-2 and

37-15 of the Act both intbiamenhenthy authorized the Rules, even

if section 37-9 did not. Defendants never again explicitly cited,

argued, or relied upon the putative authority provided by these

sections, and plaintiffs only cursorily argued their insufficiency in

authorizing the Rules. More importantly, the district court appears

to have decided that the two sections were not at issue, or that

the arguments based upon them were so frivolous as to not even

require comment, for the court made no mention of them in its

opinion. Whatever the statutory or constitutional merits of argu-

ments based upon these sections, they are still framed to authorize

the Rules, not to directly authorize searches in the absence of the

Rules. Thus their invocation does not affect the focus of this dis-

sent, which is that the validity of the Rules under state law is

a crucial question whose resolution will significantly alter or en-

tirely moot the constitutional issues in this case.

The defendants did raise an affirmative defense that ‘“‘warrant-

less searches and seizures and investigatory stops of occupational

licensees within the race track enclosure do not violate the Fourth

Amendment to the United States Constitution since horse racing

licensees have notice of the likelihood of warrantless searches by

the pervasiveness of regulation and by the long history of goyern-

mental regulation of this business.” (Citations omitted.) However,

defendants did not explicitly make clear whether “pervasiveness

of regulation” in this defense included the challenged Rules, and

the ubiquitous reliance upon the Rules throughout the rest of the

defendants’ pleadings and briefs strongly suggest that this defense

also relied upon the validity of the Rules. Surely defendants would

have explicitly announced any claims they believed authorized the

searches in the absence of the Rules.

Taare

B-19

sented by the record on appeal. Jn re Peter Bear, 789

F.2d 577, 579 (7th Cir. 1986); Johnson v. Levy Organiza-

tion Development Co., 789 F.2d 601, 611 (7th Cir. 1986).

Nevertheless, the majority today has gone beyond state

law unnecessarily and has decided a constitutional issue

not presented to the court. With all due respect, such a

decision is ill-advised. My concern is not merely technical;

while the parties have addressed themselves to the consti-

tutional requirements necessary to authorize a search

under a particular legislative scheme detailing require-

ments for such searches, the parties have not directly con-

fronted the constitutionality of such searches made with-

out explicit statutory guidelines, probable cause, or reason-

able suspicion in a pervasively regulated industry. This

court should not rule upon the issue until a case presents

it and does so without also presenting a potentially

dispositive and uncertain issue of state law. Otherwise,

the court suffers the absence of the sharp definition of

issues and exhaustive consideration of legal argument such

a case would provide. The case presented to us turns on

an unclear issue of state law whose resolution may ob-

viate and would almost certainly significantly alter the

need for constitutional adjudication. I would abstain.

A true Copy:

Teste:

Clerk of the United States Court of

Appeals for the Seventh Circuit

C-1

APPENDIX C

[Dated July 11, 1985]

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

SERPAS, et al., )

Plaintiffs,

v. No. 82 C 4715

SCHMIDT, et al.,

Defendants.

MEMORANDUM OPINION

CHARLES P. KOCORAS, District Judge:

This matter comes before the Court on the plaintiffs’

motion for summary judgment. Plaintiffs seek an order

declaring Illinois’ Thoroughbred Rule 322 and Harness

Racing Rule 25.19 unconstitutional under the Fourth and

Fourteenth Amendments, permanently enjoining defen-

dants from engaging in certain acts under the authority

of those Rules, and holding defendants liable for authoriz-

ing and conducting unlawful stops and searches. Defen-

dants oppose plaintiffs’ motion and request summary judg-

ment in their favor. For the reasons which follow, the

plaintiffs’ motion is granted in part and denied in part.

The plaintiffs in this action are Don Serpas, Raymond

Johnson, and Carl Waters, individually and on behalf of

C-2

the class of all occupation licensees of the Illinois Racing

Board who serve as exercise persons, grooms, and hot-

walkers at Illinois racetracks (the plaintiffs).1 Each named

plaintiff lives in residential quarters at Arlington Park

Racetrack provided to him in connection with his work.

The defendants are former and present members of the

Illinois Racing Board, the director of-the Illinois Depart-

ment of Law Enforcement (IDLE), and unknown agents

of IDLE. On a motion for a preliminary injunction, the

plaintiffs challenged the constitutionality of certain searches

conducted under the authority of Thoroughbred Rule 322

and Harness Rule 25.19 (the Rules).2 The plaintiffs made

three arguments against the Rules’ application and chal-

lenged: (1) the warrantless searches of their residences;

(2) the investigatory stops and searches of their persons

within the race track enclosure; and (3) the conditioning

of their occupation licenses upon their consent to such

searches. On June 16, 1983, this Court granted the plain-

tiffs’ motion and preliminarily enjoined the challenged ac-

tivities. Serpas v. Schmidt, Memorandum Opinion (N.D.

Ill. June 16, 1983) (hereinafter Mem. Op.).®

Plaintiffs now move for summary judgment and defen-

dants have made a cross-motion for summary judgment

as well. Summary judgment shall be granted when the

record shows that “there is no genuine issue as to any

material fact and that the moving party is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56. The

underlying facts and all inferences to be drawn from them

must be viewed in the light most favorable to the party

opposing the motion. Fitzsimmons v. Best, 528 F.2d 692,

694 (7th Cir. 1976). A material question of fact is one which

is outcome determinative under the govérning law. Egger

v. Phillips, 710 F.2d 292, 296 (7th Cir. 1983). Whether

there is a disputed question of fact to be presented to

the trier of fact is, in the first instance, a question of law

for the Court to determine.

The legal issues in the action fall into three parts: (1)

whether Fourth Amendment protection is afforded plain-

tiffs during warrantless searches of their living quarters;

C-3

(2) whether the investigatory stops and searches of the

plaintiffs’ person while in the race track enclosure are un-

constitutional under the Fourth Amendment; and (3) whether

the Rules unconstitutionally condition the occupation license

on consent to the searches.

Warrantless Residential Searches

In issuing the preliminary injunction, this Court placed

the burden upon the defendants to show their warrantless

residential searches, taken pursuant to the Rules, fell into

a recognized exception to the warrant requirement of the

Fourth Amendment. See Camara v. Municipal Court, 307

U.S. 523 (1967). In opposing the plaintiffs’ summary judg-

ment motion, defendants now contest the initial premise

that the Fourth Amendment is applicable at all to the

plaintiffs’ allegations. Defendants assert that the searches

take place within the context of the horse racing indus-

try, an industry with such a long history of regulation

that “‘no reasonable expectation of privacy exists within

the industry.” United States v. Harper, 617 F.2d 35 (4th

Cir. 1980). Therefore, defendants argue, plaintiffs are with-

out any reasonable expectations of privacy and are neces-

sarily outside the scope of Fourth Amendment protection.

Defendants rely upon a variety of factors—a long history

of warrantless racetrack searches, the public and plain-

tiffs’ knowledge of the searches, and the “commercial’’

nature of the plaintiffs’ living quarters. This reliance is

misplaced.

Without doubt, defendants accurately assert that horse

racing is a highly regulated industry and that the State

has an interest in maintaining the industry’s integrity.

Phillips v. Graham, 86 Il.2d 274, 427 N.E.2d 550 (1981).

Moreover, the Supreme Court has clearly recognized that

warrantless searches in closely regulated industries can

be reasonable. Donovan v. Dewey, 452 U.S. 594, 600

(1981). Under this exception to the Fourth Amendment’s

warrant requirement, courts have found that by accept-

ing the benefits of a highly regulated trade, an individual

C-4

also accepts the burden of regulation and thereby consents

to administrative investigations or inspections. Marshall

v. Wait, 628 F.2d 1255, 1258 (9th Cir. 1980). Therefore,

the individual operating within a highly regulated industry

can have no reasonable expectation of privacy at least as

to administrative inspections. Id. (emphasis added).

From this administrative inspection case law, defendants

conclude that plaintiffs cannot have a reasonable expecta-

tion of privacy in their living quarters located within the

racetrack grounds, To accept this conclusion, this Court

must accept defendants’ necessary first premise—that the

warrantless searches of plaintiffs’ living quarters are ad-

ministrative inspections. This court cannot accept the char-

acterization of the residential searches as administrative

inspections because: (A) the warrantless searches are con-

ducted or private, residential premises, not commercial

premises; (B) the statute’s language in this case does not

provide an adequate substitute for a warrant; (C) the

regulatory scheme present does not provide an adequate

substitute for a warrant; and (D) a balance of plaintiffs’

privacy interests and the Government’s enforcement needs

favors the plaintiffs.

(A) Residential Nature of Plaintiffs’ Quarters

The administrative inspection exception to the Fourth

Amendment’s warrant requirement extends to commercial

or public premises. An administrative search of commer-

cial premises and a warrantless search of a private resi-

dence are afforded very different degrees of protection.

Donovan v. Dewey, 452 U.S. at 598-99. Defendants ack-

nowledge these differences, but justify the warrantless

searches of plaintiffs’ living quarters by describing the

quarters as commercial premises. Defendants highlight the

temporary, cramped, limited nature of the quarters. The

rooms are: only provided to employees; adjacent to barns

or above horse stalls; accessible by track authorities who

have a master key; and very small—providing only one

or two person occupancy. No cooking is permitted and

some licensees do not choose to stay in the dorm room.

C-5

The detailed description of the dorm rooms does not

persuade this Court that they qualify as a commercial

premise for purposes of the Fourth Amendment. The crucial

quality which the rooms possess is their exclusive residen-

tial use. Serpas v. Schmidt, Mem. Op. at 8-10. The other

details of the plaintiffs’ living conditions cannot deprive

them of their constitutional rights to be free of unreason-

able searches in their homes. The courts have viewed

rooms similar to plaintiffs’ quarters as homes. These

rooms include hotel rooms, boarding house rooms, and col-

lege dormitory rooms. See, e.g., Stoner v. State of Cali-

fornia, 376 U.S. 483 (1964); Smyth v. Lubbers, 398 F.

Supp. 777 (W.D. Mich. 1975). Such private rooms have

been found to be homes and residences although they

share the very qualities the defendants argue make them

“commercial”: they are small, temporary, and accessible

by a master key. The plaintiffs’ rooms’ proximity to the

barns and stalls do not make them commercial; they are

used for residential purposes exclusively.

Defendants, however, analogize the warrantless searches

of plaintiffs’ rooms to the warrantless searches of the bag-

gage of persons boarding airlines, United States v. Bon-

stein, 521 F.2d 459 (2d Cir. 1975), cert. denied 97 S. Ct.

1211 (1976); of persons entering courtrooms, McMorris v.

Alioto, 567 F.2d 897 (9th Cir. 1978); of prison guards,

United States v. Sihler, 562 F.2d 349 (5th Cir. 1977); and

of a parolee’s residence pursuant to a consent provision

in his parole terms, United States v. Dally, 606 F.2d 861

(9th Cir. 1979). These cases do not change the nature of the

plaintiffs’ quarters. The cases generally involve searches

on public property—an airport, a courtroom, a prison. The

search of a parolee in Dally was governed by the terms

of a search consent which was a condition of a prisoner’s

parole. The Dally search was not characterized as an ad-

ministrative inspection. Plaintiffs’ situation is not analogous

to individuals on parole from prison.

Therefore, the plaintiffs’ living quarters are residential,

not commercial. Their temporary and crowded conditions do

not change their nature. Although employed in a highly-

C-6

regulated industry, the plaintiffs possess the constitutional

right to be from unreasonable searches in their homes.

(B) Statutory Authority for the Searches

In other highly regulated industries, warrants are not

reqenes where statutory language authorizes the terms

and conditions of searches of particular premises. Donovan

v. Dewey, 452 U.S. 594 (1981) (mining industry); United

States v. Biswell, 406 U.S. 311 (1972) (gun dealers); Colon-

nade Catering Corp. v. United States, 397 U.S. 72 (1970)

(liquor industry). The applicable statute in the Illinois

horse racing industry reads, in pertinent part:

(c) The Board, and any person or persons to whom

it delegates this power, is vested with the power to

enter the office, horse race track, facilities and other

places of business of any organization licensee to de-

termine whether there has been compliance with the

provisions of this Act and its rules and regulations.

Illinois Horse Racing Act of 1975, 8 Ill. Ann. Stat. § 37-9

(Smith-Hurd Supp. 1980).

Defendants argued earlier and again urge the Court to

find that the terms “race track” and “‘facilities’’ must in-

clude the dormitory rooms. Such a conclusion is said to

be dictated by the track’s ownership, of the rooms, the

rooms’ location within the racetrack, the track’s accessibil-

ity to the room for health and safety inspections, and the

track’s provision of the rooms to licensees at no charge.

Defendants’ Memo. at 19-20. None of these allegations

change the exclusive residential nature and purpose of the

rooms themselves.

Nor does the language of the statute support defen-

dants’ conclusion that the rooms are a “facility” or a

“racetrack.” The sentence specifically lists a series of

places and ends with the general phrase—“and other places

of business. . . .” This concluding phrase labels the earlier

places as places of business. The most reasonable reading

of “facility” or “racetrack” within the sentence is to find

C-7

that they are examples of places of business. Therefore,

as this Court found earlier, there is “a complete dearth

of statutory authorization for searches of residences or

statutory limitations on any searches.” Therefore, this

Court “will not authorize what the legislature has not.”

Mem. Op. at [14].

(C) Regulatory Powers as Authority

for the Searches

In the absence of specific statutory authority, the defen-

dants argue that the power to conduct the warrantless

searches of plaintiffs’ living quarters may be inferred or

implied from the broad regulatory powers of the Illinois

Racing Board. Defendants rely upon Balelo v. Baldridge,

724 F.2d 753, 765 (9th Cir. 1984), to argue that the Board

has been given extensive regulatory powers from which

the power to search may be inferred. Other courts have

viewed a warrantless administrative search as permissible

only when the search is specifically sathaviond bey a stat-

ute. See, e.g., United States v. Biswell, 406 U.S. 311, 315

(1972); Bionic Auto Parts and Sales, Inc. v. Fahner, 721

F.2d 1072, 1078 (7th Cir. 1983). This Circuit does not ap-

pear to recognize implied statutory authority for warrant-

less administrative searches. Even if this Circuit should

determine to recognize inferred authority, the regulatory

scheme in this case is inadequate.

Under Balelo, to determine whether warrantless searches

in a closely regulated industry are reasonable, the court

“must decide whether the regulatory scheme ‘in terms

of the certainty and regularity of its application, provides

a constitutionally adequate substitute for a warrant.’ ”

Balelo v. Baldridge, 724 F.2d at 765-66, quoting in part,

v. Donovan, 456 U.S. at 603. The Balelo court

found that a program of observers of fishing vessels,

which collected data pursuant to the Marine Mammal Pro-

tection Act, was sufficiently regulated to provide an ade-

quate substitute for a warrant. The court based its deci-

sion on several grounds: published regulations which clear-

C-8

ly defined the objective and purpose of the observer; regu-

lations which limited the scope of the observer’s activities;

written manuals to define the observer’s role; standard-

ized forms to record observations; advance notice to the

vessel’s owner of an observer’s presence; a pre-departure

conference; and the manual’s specific limits which “do not

authorize the observers to conduct searches of the per-

sons, personal effects, or living quarters of the Captains

and their crews.” Balelo v. Baldridge, 724 F.2d at 767.

Moreover, no alternative method of enforcement existed

aboard the vessel. Balelo v. Baldridge, 724 F.2d at 768

(Nelson, J., concurring).

The defendants urge the Court to find that the Board’s

regulatory scheme offers similar “certainty and regular-

ity” of application and provides an adequate substitute

for a warrant. In contrast to the Balelo regulations, how-

ever, the agents who conduct the living quarters’ searches

are not given written manuals, but “given instructions”’

on “how to carry out the searches.” No further details

of the nature of the instructions are offered. The search

procedures include: having the agent identify himself; sign-

ing a written consent form or where no consent is given,

the individual is reported to the steward; and providing

individuals with a receipt if the agents take any property.

Generally, rooms are searched only when an occupant is

present and the agent has permission to enter.

These practices, however, do not impose any meaningful

limitations on the agents’ discretion. The searches may

be focused or random and are not restricted to particular

times nor restricted to particular areas or items in those

areas which are in plain view. Unlike the observers in

Balelo, the agents here may search plaintiffs’ living

uarters and personal effects as extensively as they wish.

lainly, the agents have an unrestricted scope of search;

requiring them to hand out receipts or consent forms does

not affect or limit the agent’s discretion to undertake an

exhaustive search of every personal effect in an individual’s

room. These practices fall short as an adequate substitute

for a warrant.

a |

C-9

(D) Balance of Privacy Interests

and Enforcement Interests

In determining the reasonableness of a warrantless search,

the Court must balance the enforcement needs of the gov-

ernment and the privacy interest of the plaintiffs. See,

e.g., Marshall v. Barlow’s Inc., 436 U.S. at 31. The plain-

tiffs’ interest is strong. “{PJhysical entry of the home is

the chief evil against which the wording of the Fourth

Amendment is directed. . . .”” United States v. United

States District Court, 407 U.S. 297, 313 (1972). Because

of the constitutional protection afforded the home, the

warrant requirement has been strictly applied to searches

of the home. Illinois Migrant Council v. Pillod, 531 F.

Supp. 1011, 1021 (N.D. Ill. 1982). Therefore, governmental

authorities may not search the home without a warrant

showing probable cause unless there are exigent circum-

stances. /d. at 1022. In Camara v. Municipal Court, the

Court found that administrative warrants could authorize

searches of dwellings for building code violations. 387 U.S.

at 537-40. The Court articulated several factors which

made the search reasonable, including: public interest in

preventing or abating dangerous conditions; the history

of such inspections; good alternate techniques to discover

violations were not available; the searches were not per-

sonal in nature; and the searches were not directed toward

discovering evidence of a crime. 387 U.S. at 536-37.

The defendants contend that although plaintiffs’ privacy

interests are great, the government’s enforcement needs

are greater. They argue the warrantless residential searches

are reasonable and cite the long history of such warrant-

less searches in Illinois and elsewhere. But, primarily, de-

fendants’ arguments are focused on the public and the

State’s interests in maintaining the integrity of the horse

racing industry—an industry prone to abuse by “undesire-

able elements.” Feliciano v. Illinois Racing Board, 110

Ill. App.3d 997, 443 N.E.2d 261 (1st Dist. 1982). Specifi-

cally, defendants justify the warrantless searches because

they serve as deterrents to violations, are justified by the

“positive results” —contraband found during searches, and

because less intrusive methods would be ineffective.

C-10

The deterrent effects of the searches cannot render

them constitutional. Proof of such deterrence is specula-

tive. The statistics of positive results from searches of

the plaintiffs do not readily support the defendants’ posi-

tion. During 1981-1983, there were 361 reported searches

of the plaintiffs’ residences and persons. The stated pur-

pose of such searches is to find illegal “buzzers” and drugs

which could affect the results of the horse race. There

appear to be approximately seven searches which pro-

duced these items. Affidavit of Leonard Becika, Exhibits

A, B, C. These statistics do not justify the warrantless

searches. While the individual character and integrity of

the Board’s licensees may reflect upon the character of

the horse racing industry, this does not justify warrantless

residential searches to insure that licensees possess no

drugs used by humans in their homes.

The defendants also contend that these unannounced

warrantless searches are the most effective method of

enforcement and that other less intrusive methods would

be ineffective. The element of surprise is deemed crucial

to enforcement. The element of surprise and a warrant

to search, however, may co-exist in an ex parte warrant.

Marshall v. Barlow’s Inc., 436 U.S. at 319-20. This alter-

native would accommodate enforcement needs and the plain-

tiffs’ privacy rights. The rest of defendants’ enforcement

scheme does not involve warrantless searches and can pre-

vent the wrongs they seek to prevent. Defendants may

continue to detain horses and conduct metal detector

searches of them before the race, make searches of the

commercial premises of the racetrack, and use drug test-

ing techniques.

The defendants’ enforcement needs do not outweigh

the plaintiffs’ privacy interests. The additional Camara

factors—that the search not be personal in nature nor

directed towards discovery of criminal evidence—are plain-

ly not present here. Therefore, having considered both

parties’ interests fully, this Court finds the plaintiffs’

privacy interest is superior and renders the warrantless

searches of their homes unreasonable under the Fourth

Amendment.

C-11

II. Stops and Searches of Plaintiffs’ Persons

The plaintiffs have also challenged the warrantless in-

vestigative stops and searches of their persons, which take

place anywhere within the racetrack enclosure. Defendants

argue that these searches, like the residential searches,

are sanctioned under the administrative search exception

to the Fourth Amendment. Once again, defendants have

the burden of showing statutory authority or even implied

statutory authority for the warrantless searches. The stat-

ute authorizes the search of “facilities” and other com-

mercial premises, but nowhere is there authorization for

the search, not of a place, but of a person.* There is no

statutory authority for the searches nor any limits placed

on the searchers’ discretion. The “orders” and procedures

of the agents do not supply the requisite limits on discre-

tion. See supra, at 9-12.

Moreover, as Judge Prentice Marshall noted in J/linois

Migrant Council v. Pilliod, the Supreme Court has stated

that administrative warrants authorize searches of com-

mercial premises or property only—not the search of per-

sons found on the premises. 531 F. Supp. 1011, 1020-21

(N.D. Ill. 1982). Finally, this Court has distinguished this

ease from Wilkey v. Illinois Racing Board, et al., 74 C

3524, aff'd, 423 U.S. 802 (1975), and there are no reported

opinions which permitted administrative searches of com-

mercial premises and warrantless searches of licensees on

the premises. Mem. Op. at [15-19].

III. Conditioning License on Consent

The plaintiffs’ last challenge is directed to the condition-

ing of their occupation licenses upon their consent to be

searched. Defendants argue that the plaintiffs have volun-

tarily consented to the searches by signing a statement

to abide by Board Rule 332 and 25.19, which are printed

on the application form. The defendants rely upon the doc-

trine of implied consent—that when plaintiffs entered their

occupation, they agreed to abide by: the industry’s regula-

tion. This Court has found, however, that the issue is not

C-12

whether consent can be implied, but whether, absent the

condition, the challenged searches are constitutional. Mem.

Op. at pp. 23-28. Standing alone, the searches of the resi-

dences and persons have been found to be unconstitutional

because they violate plaintiffs’ Fourth Amendment rights.

Because these searches are unconstitutional, the license

applications requiring consent to such searches are also

unconstitutional. The Racing Board cannot issue a license

conditioned on the applicant’s consent to waive his or her

Fourth Amendment protections. Frost v. Railroad Com-

mission, 27 U.S. at 592-594.

’ Defendants argue, however, that the question of consent

‘by plaintiffs raises a disputed question of material fact

which bars plaintiffs’ motion for summary judgment. The

facts demonstrate that plaintiffs’ signature and compliance

was motivated by their fear of losing the license and the

livelihood that could be available to them only through

that license.5 The forms cannot make reasonable the war-

rantless searches of plaintiffs’ persons and homes. Schneck-

cloth v. Bustamonte, 412 U.S. 218 (1973).

IV. Requirements for Permanent Injunction

To gain injunctive relief, the plaintiffs must demonstrate

that they have no adequate remedy at law and will suffer

irreparable harm without an injunction. The plaintiffs have

shown that in the absence of permanent injunction, they

will continue to have their homes and persons searched

without a warrant. Fourth Amendment violations have

been deemed “irreparable harm” for purposes of gaining

injunctive relief. Illinois Migrant Council v. Pillod, 531

F. Supp. 1011, 1023 (N.D. Ill. 1982). Additionally, the pub-

lic has an interest in securing the plaintiffs’ constitutional

rights. The defendants will retain their full complement

of enforcement procedures and will only be precluded from

making unlawful searches and seizures. Therefore, plain-

tiffs have demonstrated that they are entitled to perma-

nent injunctive relief.

ree ee

C-13

V. Defendants’ Liability for Unlawful Acts

Plaintiffs seek to have this Court hold defendants liable

for authorizing and conducting the unlawful stops and

searches of the named plaintiffs. Summary judgment is

sought only on the issue of liability, not damages. Both

parties agree that the applicable law of government offi-

cial’s qualified immunity is set out in Harlow v. Fitzgerald,

457 U.S. 800 (1982). The Supreme Court stated: “On sum-

mary judgment, the judge appropriately may determine,

not only the currently applicable law, but whether the law

was clearly established at the time.”

To establish this qualified immunity as an affirmative de-

fense, the defendants must demonstrate that the searches

of the named plaintiffs were authorized when they were

made. The standard requires the defendants to establish

that their conduct does not violate clearly established

statutory or constitutional rights of which a reasonable

person would have known. Defendants argue that the law

of warrantless administrative investigations in closely

regulated industries plainly authorized their searches. Rea-

sonable people could have concluded they had the author-

ity to conduct the searches. Donovan and Camara per-

mitted administrative searches and defendants could have

believed there were sufficient limits on the discretion of

those conducting the search. Therefore, this court holds

the defendants are not liable for authorizing and conduct-

ing the unlawful stops and searches of the named plain-

tiffs. -

VI. Discovery Sanctions

Defendants have asked this Court to dismiss plaintiffs’

action because plaintiffs failed to answer discovery de-

mands. Plaintiffs invoked the Fifth Amendment in response

to defendants’ interrogatories about plaintiffs’ possession

or use of equine drugs, buzzers or mechanical devices, and

cocaine or marijuana. Defendants assert that the infor-

mation is requested to show the need for their searches

and to develop a possible equitable defense of unclean

C-14

hands. At a minimum, defendants ask the Court to dis-

miss plaintiffs’ damages claim.

Without addressing the necessity or relevance of the evi-

dence requested, this Court finds that the plaintiffs’ in-

vocation of the Fifth Amendment does not warrant the

extreme remedy of dismissal. Case law indicates that dis-

missal is an option only where the invocation of the right

is improper and pretextual and the plaintiff has refused

the court’s order compelling discovery. See, e.g., Camp-

bell v. Gerrans, 592 F.2d 1054, 1057-58 (9th Cir. 1979).

Neither element is present here; plaintiffs’ invocation is

not improper and no court order issued. Plaintiffs have

replied to discovery completely with this exception. Defen-

dants are not entitled to dismissal.

VII. Scope of the Injunction

The defendants also raise an issue concerning the scope

of this Court’s injunction, if it issued. The plaintiffs seek

relief against the named defendants and this Court’s in-

junction binds them and “those persons in active concert

or participation with them who receive actual notice of

the order by personal service or otherwise.” Fed. R. Civ.

P. 65(d). At this time, the Court grants the injunction

against the named defendants.

VIII. Probable Cause Requirement

In its earlier decision, this Court conducted an exten-

sive analysis of Camara v. Municipal Court, 387 U.S. 523

(1967) and concluded that under its rationale, an adminis-

trative warrant would be inappropriate and that defen-

dants must procure a warrant based upon “the more vigor-

ous standard of ‘probable cause’ used in criminal cases.”

Mem. Op. at [24-29]. At that time, the Court indicated that

it would entertain a motion to modify the type of war-

rant required if further evidence were forthcoming. The

evidence developed during discovery has not disturbed the

Court’s initial findings. Therefore, the Court finds that:

(1) the harm resulting from violations of racing require-

C-15

ments is not comparable to the harm from ‘‘an epidemic

or an uncontrollable blaze” in Camara; (2) there is no

showing that defendants will be unable to regulate the

industry effectively if probable cause is required for a

warrant; (3) there are important privacy interests at stake

and the searches are personal and aimed at discovery of

criminal evidence; (4) there are no “reasonable legislative

or administrative standards” for the searches. See supra

at 8-12.

For the foregoing reasons the Court declares: that Thor-

oughbred Rule 322 and Harness Racing Rule 25.19 are

unconstitutional under the Fourth and Fourteenth Amend-

ments to the United States Constitution.

The Court permanently enjoins defendants from engag-

ing in these acts pursuant to the Rules:

a. Conducting or authorizing searches and seizures

of the persons and residential quarters of plaintiffs

and the class they represent without warrants and

probable cause;

b. Conducting or authorizing investigatory stops

of plaintiffs and the class they represent without at

least a reasonable suspicion, based on specific, ar-

ticulable facts, that the person stopped is engaged

in criminal activity; and

ce. Conditioning the issuance of occupation licenses

upon applicants’ forfeiture of their constitutional right

to by free from the searches authorized by Rules 322

and 25.19. |

Finally, this Court holds that defendants are not liable

to the named plaintiffs for authorizing and conducting

unconstitutional searches of named plaintiffs’ persons and

residences.

/s/ CHARLES P. Kocoras

Charles P. Kocoras

United States District Judge

Dated: July 11, 1985

C-16

1 This Court certified these persons as a Rule 23(bX2) class on

September 19, 1983.

2 The regulations are set forth in two rules, identical in language,

which read as follows:

INSPECTIONS AND SEARCHES

a. The Illinois Racing Board or the state steward investigat-

ing for violations of law or the Rules and Regulations of

the Board, shall have the power to permit persons author-

ized by either of them to search the person, or enter and

search the stables, rooms, vehicles, or other places within

the track enclosure at which a meeting is held, or other

tracks or places where horses eligible to race at said race

meeting are kept, of all persons licensed by the agents of

any race track operator licensed by said Board; and of all

vendors who are permitted by said race track operator to

sell and distribute their wares and merchandise within the

race track enclosure, in order to inspect and examine the

personal effects or property on such persons or kept in

such stables, rooms, vehicles, or other places as aforesaid.

Each of such licensees, in accepting a license, does thereby

irrevocably consent to such search as aforesaid and waive

and release all claims or possible actions for s that

he may have by virtue of any action taken under this rule.

Each employee of a licensed operator, in accepting his em-

ployment, and each vendor who is permitted to sell and

distribute his merchandise within the race track enclosure,

does thereby irrevocably consent to such search as afore-

said and waive and release all claims or possible actions

for damages they may have by virtue of any action taken

under this rule. Any person who refuses to be searched pur-

suant to this rule may have his license suspended or revoked.

b. The Illinois Racing Board delegates the authority to con-

duct inspections and searches, under this rule, to the Chief

Investigator of the Illinois Racing Board and to Special

Agents of the Illinois Bureau of Investigation, or designees

of the Department of Law Enforcement assigned, from time

to time, to assist the Chief Investigator in his duties.

3 The underlying facts of the action are set out in the preliminary

injunction ruling. Mem. Op. at [1-4].

4 Section 37-%a) grants the Board jurisdiction over “all persons

on organizational grounds.” Section 37(d) authorizes the Board to

“investigate alleged violations of the provision of this Act.”’ Neither

of these constitute authorization of the warrantless search of persons.

5 Disputes over when consent for a single, particular search was

given or what precise items were searched are not materia! ques-

tions of fact.

Dl

APPENDIX D

(Dated June 16, 1983]

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

DON SERPAS, et al., )

Plaintiffs,

v. No. 82 C 4715

CHARLES E. SCHMIDT, et al.,

Defendants. ‘

MEMORANDUM OPINION

CHARLES P. KOCORAS, District Judge:

This matter comes before the Court on »laintiffs’ motion

for a preliminary injunction and defendants’ motion to dis-

miss.! The three named plaintiffs are “occupation licensees”’

of the Illinois Racing Board and are currently employed

as grooms with responsibility for the basic caretaking of

horses at Arlington Park Racetrack. Each plaintiff lives

in residential quarters located at the Arlington Park Race-

track. The quarters are owned by the race track and are

1 Plaintiffs have also filed a motion for class certification. Because

that motion is not yet fully briefed and because its resolution is

not required at this time, that motion is not addressed in this

opinion.

D-2

provided to plaintiffs in connection with their employment.

The plaintiffs allege that these residential quarters have

been searched and that they themselves have also been

stopped and personally searched within the race track en-

closure by agents of the Illinois Department of Law En-

forcement.

Plaintiffs acknowledge that they signed forms in which

they consented to a search of their persons and quarters,

as was required in order to obtain their occupation licenses

from the state. They also admit that they consented to

each search at the time of its occurrence? because they

understood that they must do so to retain their licenses.

Each plaintiff alleges, however, that he would not have

consented to the warrantless searches if such consent had

not been necessary to obtain his license and pursue his

means of livelihood.

The defendants agree that the searches described by

plaintiffs did occur,’ and that plaintifffs’ receipt of a license

was conditioned upon their consent to the searches, but

maintain that the described events do not form the basis

for a cause of action. According to defendants, the war-

rantless searches were authorized under state statute and

regulations, were freely and fully consented to, and were

constitutional.

The regulations upon which defendants rely, and under

which plaintiffs consented to the searches, are set forth

in two rules, identical in language, which read as follows:

2 There is a dispute between the parties regarding whether con-

sent was obtained before or after a search of certain residential

quarters (Aff. of Raymond Johnson, 48; Aff. of Robert Mage, 16);

and the nature of the information conveyed by enforcement agents

to plaintiffs concerning the ramifications of their failure to con-

sent (see Defendants’ Reply Memorandum, p. 7). For the purposes

of the present motion, these disputes are not material.

3 There is also a — between the parties regarding whether

plaintiff Johnson’s wallet was searched (Aff. of Raymond Johnson,

q2; Affs. of Robert Mager and Dannie Pierce).

€.

D-3

INSPECTIONS AND SEARCHES

The Illinois Racing Board or the state steward

investigating for violations of law or the Rules

and Regulations of the Board, shalt have the

power to permit persons authorized by either of

them to search the person, or enter and search

the stables, rooms, vehicles, or other places

within the track enclosure at which a meeting is

held, or other tracks or places where horses eligi-

ble to race at said race meeting are kept, of all

persons licensed by the Board, and of all employees

and agents of any race track operator licensed

by said Board; and of all vendors who are per-

mitted by said race track operator to sell and dis-

tribute their wares and merchandise within the

race track enclosure, in order to inspect and ex-

amine the personal effects or property on such

persons or kept in such stables, rooms, vehicles, or

other places as aforesaid. Each of such licensees,

in accepting a license, does thereby irrevocably

consent to such search as aforesaid and waive

and release all claims or possible actions for dam-

ages that he may have by virtue of any action

taken under this rule. Each employee of a licensed

operator, in accepting his employment, and each

vendor who is permitted to sell and distribute his

merchandise within the race track enclosure, does

thereby irrevocably consent to such search as

aforesaid and waive and release all claims or

possible actions for damages they may have by

virtue of any action taken under this rule. Any

person who refuses to be searched pursuant to

this rule may have his license suspended or re-

voked.

The Illinois Racing Board delegates the author-

ity to conduct inspections and searches, under

this rule, to the Chief Investigator of the Illinois

Racing Board and to Special Agents of the Illi-

nois Bureau of Investigation, or other designees

D-4

of the Department of Law Enforcement assigned,

from time to time, to assist the Chief Investi-

gator in his duties.

Thoroughbred Rule 322; Harness Rule 25.19 (Exhibit A,

Defendants’ Memorandum in Support of Motion to Dismiss).

Plaintiffs do not challenge the constitutionality of searches

of non-residential premises authorized by Rule 322 and

25.19 (Plaintiffs’ Memorandum p. 2). They also do not con-

test the searches of persons other than those in the class

which they seek to represent.‘ (Plaintiffs’ Reply, p. 13).

Accordingly, plaintiffs do not object to the searches of

jockeys, stable searches or the testing of horses. (Plain-

tiffs’ Reply, p. 13). Rather, they limit their challenge to

(1) the warrantless searches of their residential quarters;

(2) the ..arrantless investigative stops and searches of

their persons while anywhere in the racetrack enclosure;

and (3) the conditioning of their licenses upon their con-

sent to such searches. For the reasons set forth below,

this Court agrees that defendants must be enjoined from

engaging in each of the three contested practices.

I. Residential Searches

The Fourth Amendment provides that “the right of the

people to be secure in their persons, houses, papers, and

effects, against unreasonable searches and seizures, shall

not be violated, and no warrants shall issue, but upon prob-

able cause, supported by oath or affirmation, and icu-

larly describing the place to be searched, and the per-

sons or things to be seized.” The basic purpose of this

Amendment is clear: it is to safeguard the privacy and

security of individuals against arbitrary invasions by gov-

4 Plaintiffs seek to represent ‘all occupation licensees of the Illi-

nois Racing Board who are employed as exercise persons, grooms

and hotwalkers at race tracks in Illinois and who reside in residen-

tial quarters at racetracks in Illinois.” Plaintiffs’ Motion for Class

Certification, 1.

D-5

ernment officials. And, although it is sometimes difficult

to “[translate] the abstract prohibition against ‘unreason-

able searches and seizures’ into workable guidelines for

the decision of particular cases, . . . [njevertheless, one

governing principle, justified by history and by current

experience, has consistently been followed: except in cer-

tain carefully defined classes of cases, a search of private

property without proper consent is ‘unreasonable’ unless

it has been authorized by a valid search warrant.’”’ Camara

v. Municipal Court, 307 U.S. 523, 87 S.Ct. 1727 (1967)

(citations omitted). Accordingly, the burden lies heavily

upon defendants to show that the warrantless searches

authorized under Rule 322 and 25.19 do not violate the

plaintiffs’ Fourth Amendment rights. See, e.g., Wilson v.

Health and Hospital Corp. of Marion Cty., 620 F.2d 1201,

1208 (7th Cir. 1980).

One “carefully defined class of cases” under which war-

rantless searches have been found constitutional by the

Supreme Court involves administrative investigations of

highly regulated industries. Donovan v. Dewey, 452 U.S.

594, 101 S.Ct. 2534 (1981) (mining industry); U.S. v. Biswell,

406 U.S. 311, 92 S.Ct. 1593 (1972) (gun dealers); Colon-

nade Catering Corp. v. U.S., 397 U.S. 72, 90 S.Ct. 774

(1970) (liquor industry). Warrants were not constitutionally

required in these cases because “Congress [had] reason-

ably determined that warrantless searches [were] neces-

sary to further a regulatory scheme and the federal regu-

latory presence [was] sufficiently comprehensive and defined

that the owner of commercial property [could not] help but

be aware that his property [would] be subject to periodic

inspections undertaken for specific purposes.” Donovan

v. Dewey, 452 U.S. at 600, 101 S.Ct. at 2539.

Defendants urge that the present case falls within this

oe because the race track industry is a highly regu-

lated one, comparable to the gun, liquor, and mining in-

dustries. Clearly, the State of Illinois does closely regulate

the race track industry and maintains a strong interest

in ensuring its integrity. Phillips v. Graham, 86 IIl.2d 274,

427 N.E.2d 550 (1981); Finish Line Express, Inc. v. City

D-6

of Chicago, 79 Ill.2d 131, 379 N.E.2d 290 (1978). However,

two other factors distinguish the present case from Donovan,

Biswell, and Colonnade.

First, each of those cases involved searches of commer-

cial premises, not residential quarters. This distinction is

important, according to the Supreme Court:

{Ujnlike searches of private homes, which generally

must be conducted pursuant to a warrant in order

to be reasonable under the Fourth Amendment*, leg-

islative schemes authorizing warrantless administra-

tive searches of commercial property do not neces-

sarily violate the Fourth Amendment. . . The greater

latitude to conduct warrantless inspections of com-

mercial property reflects the fact that the expecta-

tion of privacy that the owner of commercial prop-

erty enjoys in such property differs significantly from

the sanctity accorded an individual’s home, and that

this privacy interest may, in certain circumstances,

be adequately protected by regulatory schemes au-

thorizing warrantless inspections. United States v.

Biswell, supra, 406 U.S. at 316, 92 S.Ct. at 1596.

Donovan v. Dewey, 452 U.S. at 598-99, 101 S.Ct. at 2537-

38 (citations omitted, emphasis supplied).5 See also, Stea-

gald v. United States, 451 U.S. 201, 101 S.Ct. 1642 (1981)

(“‘we have consistently held that the entry into a home

to conduct a search or make an arrest is unreasonable

5 The footnote designated with an asterisk in the text of the Su-

preme Court opinion reads:

Absent consent or exigent circumstances, a private home

may not be entered to conduct a search or effect an arrest

without a warrant. Steagald v. United States, 451 U.S. 204,

101 S.Ct. 1642, 68 L.Ed.2d 38 (1981); Pa v. New York,

445 U.S. 573, 100 S.Ct. 1371, 63 L.Ed.2d (1980); Johnson

v. United States, 333 U.S. 10, 68 S.Ct. 367, 92 L.Ed. 436 (1948).

Of course, these same restrictions pertain when commercial

roperty is searched for contraband or evidence of crime. G. M.

ing Corp. v. United States, 429 U.S. 338, 352-359, 97 S.Ct.

619, 628-632, 50 L.Ed.2d 530 (1977).

D-7

under the Fourth Amendment unless done pursuant to

a warrant”); Illinois Migrant Council v. Pilliod, 531 F.

Supp. 1011, 1021 (N.D. Ill. 1982) (that government seeks

authorization to enter and search homes “poses a very

different question,” from one involving an administrative

search of commercial premises).

Defendants, in response, state that they “‘are aware of

and do not take lightly the Fourth Amendment protec-

tions afforded to persons in their homes.” However, they

argue, plaintiffs’ quarters are not homes within the mean-

ing of the Fourth Amendment:

The dormitories here involved are only Plaintiffs’

temporary quarters occupied incident to Plaintiffs’

employment. The dormitories are adjacent to the

barns where the horses are housed. A quick trip from

a dormitory room to the barn is all it takes to change

the course of a race. The named Plaintiffs all have

permanent residences outside of the race track enclo-

sure. Their living quarters are so intrinsically bound

up with the racing industry that they must be con-

sidered a business establishment for Fourth Amend-

ment purposes rather than residences. Under Plain-

tiffs’ —s a liquor dealer who sleeps in his store

at night could not have his establishment searched

during the day.

Defendants’ Reply, pp. 13-14.

These arguments are not compelling. What is critical

is that plaintiffs’ quarters are used exclusively for residen-

tial purposes. This factor distinguishes the present situa-

tion from defendants’ hypothetical liquor store example.

The proximity of the quarters to the barn is also irrele-

vant; Fourth Amendment protections would extend to a

house used exclusively for residential purposes even if it

were built in the middle of the race track. Finally, the

fact that plaintiffs’ economic circumstances and the nature

of their job requires them to move from race track to

D-8

race track® cannot erase their constitutional rights to be

free of unreasonable searches in those places which are

their homes, however temporary. Stoner v. State of Cali-

fornia, 376 U.S. 483, 490, 84 S.Ct. 889, 893 (1964) (“No

less than a tenant of a house, or the occupant of a room

in a boarding house . . . a guest in a hotel room is en-

titled to constitutional protection against unreasonable

searches and seizures.”’). See also, Smyth v. Lubbers, 398

F.Supp. 777 (W.D. Mich. 1975) (college dormitory room

is a “home” within the ambit of Fourth Amendment pro-

tections). Thus, the instant case is clearly distinguish-

able from the Supreme Court cases in which warrantless

administrative searches were permitted because the facts

here involve searches of residential, rather than commer-

cial, premises.?

Second, the statutory authority for the searches in this

case is far less specific than that at issue in the gun,

liquor, and mining industry cases. The applicable statute

here reads, in relevant part:

6 Plaintiffs argue that backstretch workers like themselves live

on the race tracks at which they are currently working as a matter

of economic necessity. When the racing season ends at one race-

track, the backstretch workers migrate immediately to new rooms

on the track where the new season has commenced. And, continue

—s although some backstretch workers may have some family

iving elsewhere, the residential quarters on the racetrack are the

homes in which the overwhelming majority of grooms, hotwalkers

oar exercise persons exclusively reside. Aff. of Joan Rappaport,

-5.

7 Defendants’ citation of various state cases in which warrantless

searches of racetrack facilities were upheld is also inapposite. In

State v. Dolce, 178 N.J. Super. 275, 428 A.2d 947 (1981), the search

was merely of commercial premises and of a trainer’s truck. Like-

wise, in both Federman v. State of Florida, Department of Busi-

ness Regulation, Division of Pavi-Mutuel Wagering, 414 So.2d 28

(Fla. Dist. Ct. App. 1982) and Lancaster v. Pennsylvania State

Horse Racing Commission, 16 Pa. Commw. Ct. 85, 325 A.2d 645

(1974) searches of licensees’ trucks were upheld. None of the cases

involved residential premises.

D-9

(c) The Board, and any person or persons to whom

it delegates this power, is vested with the power to

enter the office, horse race track, facilities and other

places of business of any organization licensee to

determine whether there has been compliance with

the provisions of this Act and its rules and regula-

tions.

Illinois Horse Racing Act of 1975, 8 Ill. Ann. Stat. §37-9

(Smith-Hurd Supp. 1980) (emphasis supplied).

This provision, in marked contrast to those involved in

Donovan, Biswell, and Colonnade, does not specifically

authorize warrantless searches of the particular premises

searched. Although defendants argue that piaintiffs’ resi-

dential quarters fall within the statutory term “facilities,”

such a construction of the statute is untenable, given this

Court’s determination above that the plaintiffs’ quarters

are residential homes. The term “facilities,” when read

in context of the entire provision, patently encompasses

only business facilities.®

The fact that the statute does not explicitly authorize

warrantless searches of residences raises serious doubts

about defendants’ contention that such searches are consti-

tutional. Aside from the important difference in the places

to be searched, i.e., residences as opposed to commercial

facilities, the lack of express statutory mandate to search

residences forces the defendants to rely on their own rules

and regulations to justify their conduct. Defendants con-

tend that even absent an explicit statutory basis, the rules

permitting the searches must be presumed valid and given

the force and effect of law under “well established admin-

istrative law principles.” Defendants’ Reply Memorandum,

p. 12. The constitution and the Supreme Court, however,

demand more when the invasion of people’s homes by “in-

vestigators” is at stake:

8 No other reading would be reasonable: the word “facilities’’ is

sandwiched between a list of obviously commercial premises and

the clause “other places of business” (emphasis supplied).

D-10

In the context of a regulatory inspection system of

business premises that is carefully limited in time,

place and scope, the legality of the search depends

not on consent but on the authority of a valid statute.

U.S. v. Biswell, 406 U.S. at 315, 92 S.Ct. at 1596 (empha-

sis supplied). See, Balelo v. Klutznick, 519 F.Supp. 573

(S.D. Calif. 1981). The rationale for this requirement of

an express statute

is undoubtedly to be found in. . . United States v.

United States District Court, 407 U.S. 297, 316, 92

S.Ct. 2125, 2136, 32 L.Ed.2d 752 (1972). [There the

Court made a statement] regarding the traditional

role of the detached and impartial magistrate in the

issuance of a warrant, i. e., the magistrate assures

that there is probable cause for the search and that

the scope of the search is appropriately limited in

time, place and scope. As the Court points out, an

administrator cannot fulfill these traditional functions

of the magistrate since he, himself, is the searcher.

Congress, however, being elected by and responsive

to the people, and presumably sensitive to their con-

stitutional rights, comes closer to fulfilling the role

of the magistrate than any administrator can. Accord-

ingly, a properly drawn statute in appropriate cases

may substitute for the warrant. See, United States

v. Cooper, 409 F.Supp. 364, 368 (M.D. Fla. 1976),

affd., 542 F.2d 1171 (5th Cir. 1976). While the courts

remain the ultimate arbiters of the reasonableness

of a search even where authorized by Congress, . . .

on the whole, deference has been shown to the con-

gressional determination of the standard of reason-

ableness. Colonnade Catering Corp. v. United States,

397 U.S. 72, 90 S.Ct. 774, 25 L.Ed.2d 60 (1970).

Balelo v. Klutznick, 519 F.Supp. at 59-80 (citations omitted).

Clearly, therefore, the fact that the Illinois legislature did

not explicitly permit a warrantless search of plaintiffs’

residences renders defendants’ attempted justifications for

any such searches constitutionally i ; defendants may

not rely upon regulations promulgated subsequently.

D-11

Even if the statutory provision, §37-9(c) were inter-

preted to authorize warrantless searches of residential

premises,? defendants’ argument must still fail. The Su-

preme Court, in its administrative warrant cases, has also

demanded that the statute be specific and limited enough

so as to provide “privacy guarantees.’’ Some standards

for conducting the authorized searches must be enunci-

ated. This was emphatically stated by the Supreme Court

in the 1981 case of Donovan v. Dewey:

“Where Congress has authorized inspection but made

no rules governing the procedures that inspectors

must follow, the Fourth Amendment and its various

restrictive rules apply.” Colonnade Corp. v. United

States, supra, 397 U.S. at 77, 90 S.Ct., at 777. In

such cases, a warrant may be necessary to protect

the owner from the “unbridled discretion[of] executive

and administrative officers,” Marshall v. Barlow’s,

Inc., supra, 436 U.S., at 323, 98 S.Ct., at 1826, by

assuring him that “reasonable legislative or adminis-

trative standards for conducting an . . . inspection

are satisfied with respect to a particular [establish-

ment].” Camara v. Municipal Court, 387 U.S. 523,

538, 87 S.Ct. 1727, 1735, 18 L.Ed.2d 930 (1967).

Donovan, 452 U.S. at 599, 101 S.Ct. at 2538.

Donovan makes clear that in “notorious,” highly regu-

lated industries, subject to frequent administrative searches,

a licensee’s constitutionally cognizable privacy expectations

are reduced, and warrantless searches are much more like-

ly to be constitutional.t° Nevertheless, the Court also

makes clear that unbridled administrative discretion in

searches will not be tolerated and that the statute must

provide some specific limitations on such discretion. See

® As indicated supra, I believe that such a construction is im-

plausible. :

10 As noted above, Donovan involves, in both its facts and lan-

guage, only searches of commercial premises.

D-12

also, Bionic Auto Parts and Sales, Inc. v. Fahner, 518

F.Supp. 582 (N.D. Ill. 1981) (applying the Donovan stan-

dards, the Court concluded that the used auto parts busi-

ness was a special industry within the range of the Colon-

nade and Biswell cases, but that the statutory authoriza-

tion for warrantless searches was nonetheless too broad,

rendering the provision unconstitutional).

Similarly, in the two earlier cases of Biswell and Colon-

nade, the Court discussed both the limited nature of the

dealer’s justifiable expectations of privacy in a pervasive-

ly regulated business, and the need for an inspection Sys-

tem which “‘is carefully limited in time, place, and scope.’

Biswell, supra, 406 U. s. at 315, 92 S. Ct. at 1596. In Bis-

well, the Gun Control Act limited entry into the premises

of a firearms or munitions dealer to business hours and

specified that entry was to be “for the purpose of inspect-

ing or examining (1) any records or documents required

tu be kept . . . and (2) any firearms or ammunition kept

or stored by such... dealer. . . at such premises.” /d.

at 311-312, 92 S.Ct. at 1594.

In Colonnade, the law provided that inspectors could

enter premises of retail liquor dealers only during bi&i-

ness hours and specified that a refusal to allow entry dur-

ing the appropriate hours would result in the imposition

of a fine. The Court allowed warrantless searches to trans-

pire under that statute, but specifically held inadmissible

under the Fourth Amendment evidence which had been

seized by a forceable entry after the liquor dealer had

refused to open a locked liquor storeroom. Given “this

Nation’s traditions that are strongly opposed to using

force without definite authority to break down doors,” the

Court would not read a Congressional authorization for

forced entry into the statute where none explicitly ex-

isted. “Where Congress has authorized inspection but

made no rules governing the procedure that inspectors

must follow, the Fourth Amendment and its various re-

strictive rules apply.” Colonnade, 397 U.S. at 77, 90 S.Ct.

at 777.

D-13

Finally, in the seminal administrative inspection case in

which the Court required the inspecting agency to obtain

a warrant, the Court rejected the arguments that the or-

dinance involved provided enough protections for occupants

without a warrant and that the warrant process could not

function effectively in the area of municipal inspections.

The Court said:

Under the present system, when the [housing] tn-

spector demands entry, the occupant has no way of

knowing whether enforcement of the municipal code

involved requires inspection of his premises, no way

of knowing the full limits of the inspector’s power

to search, and no way of knowing whether the inspec-

tor himself is acting under proper authorization ...

The practical effect of this system is to have the oc-

cupant subject to discretion of the official in the field.

This is precisely the discretion to invade private prop-

erty which we have consistently circumscribed by a

requirement that a disinterested party warrant the

need to search.

Camara v. Municipal Court, 387 U.S. at 532, 87 S.Ct.

at 1732-33. See also, Hometown Co-op. Apartments v. City

of Hometown, 495 F.Supp. 55 (N.D. Ill. 1980).

The statute in this case is woefully inadequate when

measured against the standards established by the Su-

preme Court. The discretion of the inspectors is wholly

unbridled; indeed, the statute here does even require the

searches to be performed ‘‘at . . . reasonable times, and

within reasonable limits and in a reasonable manner,” as

the deficient OSHA statute in Marshall did.

In weighing the reasonableness of the warrantless searches

of plaintiffs’ quarters, this Court has considered both the

enforcement needs articulated by the government?! and

11 While defendants consistently urge that surprise warrantless

searches are critical to the effective policing of the race track in-

dustry, there has been no specific showing that the government

(Footnote continued on following page)

D-14

the privacy interest of plaintiffs. See, e.g., Marshall v.

Barlow’s, Inc., 486 U.S. at 31, 98 S.Ct. at 1825. Because

of the historical legal protection afforded the home under

our Constitution, and the complete dearth of statutory au-

thorization for searches of residences or statutory limita-

tions on any searches, this Court will not authorize what

the legislature has not. The defendants are enjoined from

conducting or approving warrantless searches of the resi-

dential quarters at Illinois race tracks.

II. Searches of the Person

The deficiencies which infect the statute and rules under

the analysis in Part I also undermine defendants’ arg

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