Petition for Writ of Certiorari — Ryan v. Powell

J Supreme Court, U.S.

(\) FILED

99527 Sep24i19

No. OFFICE OF THE CLERK

IN THE SUPREME COURT OF THE UNITED STATES

MATTHEW J. RYAN, ROBERT C. JUBELIRER,

JESS M. STAIRS and JAMES J. RHOADES,

Petitioners,

vs.

DAVID POWELL, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

DICK THORNBURGH

JOHN P. KRILL, JR. (Counsel of Record)

LINDA J. SHOREY

DAVID R. FINE

KIRKPATRICK & LOCKHART LLP

240 NORTH THIRD STREET

HARRISBURG, PA 17101

(717) 231-4500

Counsel for Petitioners

SEPTEMBER 24, 1999

QUESTIONS PRESENTED

1. Whether a_ federal agency’s

regulation prohibiting unintentional disparate impacts as to

race or ethnicity in state programs receiving federal funds

exceeds the statutory authority of the agency, which is

limited to promulgating regulations that “effectuate the

provisions of” Section 601 of Title VI of the Civil Rights

Act of 1964, which prohibits only _ intentional

discrimination.

2 Whether Congress intended to allow

plaintiffs to bypass federal agencies and to bring private

actions to enforce disparate-impact regulations

promulgated under Section 602 of Title VI of the Civil

Rights Act of 1964.

3: Whether an alleged injury to

plaintiffs is traceable or redressable for purposes of

standing under Article III of the Constitution, where

plaintiffs complain about unequal state subsidies to local

school districts, but where the plaintiffs’ own school

district can offset any increase in the state subsidy by a

reduction in its own share of spending.

ii

LIST OF PARTIES

Petitioners are officers of the General Assembly of

the Commonwealth of Pennsylvania: Matthew J. Ryan,

Speaker of the House of Representatives; Robert C.

Jubelirer, President pro tempore of the Senate; Jess M.

Stairs, Chairman of the House Education Committee; and

James J. Rhoades, Chairman of the Senate Education

Committee (the “Legislative Parties”). The Rep. Stairs and

Sen. Rhoades are also ex officio members of the State

Board of Education. Petitioners intervened in district court

in support of the defendants and were appellees in the

Third Circuit. Respondents who were defendants in district

court and appellees in the court of appeals are executive-

branch officers of the Commonwealth: Thomas J. Ridge,

Governor; James P. Gallagher, Chairman of the State

Board of Education); Eugene W. Hickok, Secretary of

Education; Barbara Hafer, Treasurer (the “Executive

Parties”). Respondents who were plaintiffs in district court

and appellants in the court of appeals include the following:

the City of Philadelphia and its Mayor, Edward G. Rendell;

the School District of Philadelphia, its Superintendent,

David W. Hornbeck, its Board of Education and the

President of the Board, Floyd W. Alston; David Powell;

Shelean Parks; Patrice Everage; Julia A. Davis; Yvette

Bland; Geraldine Newton; Maria M. Rivera; Mary E.

Miller; Gregory Luzak; Catherine Luzak; Fu Zhen Xie; The

Black Clergy of Philadelphia and Vicinity; Philadelphia

Branch NAACP; ASPIRA, Inc., of Pennsylvania; Parents

Union for Public Schools; Citizens Committee On Public

Education In Philadelphia; Parents United for Better

Schools, Inc., Respondent, the Philadelphia Federation of

Teachers, intervened as a plaintiff in district court and was

an appellee in the court of appeals.

TABLE OF CONTENTS

ear das becedccdatd settle ncn acianeeseess nod ckin

No Ee GSES EE A Le aS ee Pee De Ee

PE TNIOY titliks catsdsibsvkbdenodiisnosdescbnsstboubansabanstbusddoaia

NORE EEE LS Ae ier an a EN IE ARE

Statutory Provisions Involved............0....ccccccccescseeeeeeeeesees

MT I IID scsinscnspuaactinncokdcarnsoceuncesevésesasussaundineas

ip ST IN oad asisecsccksccoosdeunddbnesivibesoabiccndass

CE oe eR a

REASONS FOR GRANTING THE PETITION. ........

I. WHETHER A REGULATION MAY PROHIBIT

UNINTENTIONAL DISPARATE IMPACTS

WHEN THE UNDERLYING STATUTE

PROHIBITS ONLY INTENTIONAL

DISCRIMINATION IS AN IMPORTANT ISSUE

AND THE THIRD CIRCUIT’S CONCLUSION IS

INCONSISTENT WITH RECENT AUTHORITY

a TIS seth ihadisadicesichccninsasiscencebbbeatreemnatachioecie

oe

iV

I]. THE COURT SHOULD DECIDE WHETHER

PLAINTIFFS CAN BYPASS THE FEDERAL

AGENCY THAT OVERSEES A SPENDING

PROGRAM AND ASSERT A PRIVATE CAUSE

OF ACTION UNDER “DISPARATE-IMPACT”

TRAGER IO OD vicccscncsitianieisitbanttcomalsabbiascbidebidiabaestasioioes 10

A. It is a question of national importance that

affects innumerable federal, state and local

OIE, sisincitnidssnnicciseniainasescctinkianiiniaiiiietinsceibuntamants 10

B. Courts of appeals have used different tests to find

an implied private right of action in agency

I idicdimitdiecnnisiinniiiliininlipdilictdesnibinkniissiiiilaio’ 14

C. The Third Circuit erred in determining that

disparate-impact regulations under Title VI

could support private ActiONs .............ccceeeeeteeeeneeeees 17

l.

The court of appeais looked to the wrong

I iiss sects biisecinstinniniitrnibtnsntabheitebtihads 17

. The disparate-impact regulation is impermissibly

beyond the scope of the statute... eceeeeeeeees 20

. Implying a private right of action to enforce

disparate-impact regulations would not be

consistent with the purposes of the

CUT I ic isc chtiticiscsnincsinsiiaileidictlicsitateitichndicitlic 20

Implying a private right of action to enforce

Title VI disparate-impact regulations has

federalism implications ............c.cccccccecsscsessessseseees 22

Vv

III. THE COURT OF APPEALS’ DECISION

PROVIDES AN OPPORTUNITY FOR

THIS COURT TO CONSIDER THE

APPLICATION OF ASARCO V KADISH

IN A SITUATION IN WHICH THE

SOURCES OF HALF OF THE OVERALL

FUNDING ARE PLAINTIFFS RATHER

SRRAARS ERP PAIS Dsscseccdscossbsasaceassaasssassssonentestesin 24

8 PREP EIRE, Fik SOUS. EN Ns AS MON ey EPID FY 29

vi

TABLE OF AUTHORITIES

FEDERAL CASES

Alexander v Choate, 469 U.S. 287 (1985) ........cc.c0005 passim

Angelastro v Prudential-Bache Securities,

TOA F286 SSP GAS SOP caiemnescrechttcinesmntntnnineionses 14, 17, 20

Asarco, Inc. v Kadish, 490 U.S. 605 (1989) ............... 26, 27

Atchison, Topeka & Sante Fe Railway Co. v

Wichita Board of Trade, 412 U.S. 800 (1973) .........0.000 16

Bryant v New Jersey Department of Transportation,

No. 97-1397, 1998 U.S. Dist. LEXIS 1847

(D.NJ. FOR. 17, COGHE cintisstinnmtnssescrntinamsnaniinitiaaialacen 7

Buchanan vy City of Bolivar, Tenn., 99 F.3d 1352

(CAG TSIGD ccsssssspsshintinntitnnicinioesenitiammiannne 1]

Castenada by Castenada v Pickard, 781 F.2d

4356 CCAS TROD cncericstunnsisietiiiniaineemamens 11

Central Bank of Denver, N.A. v First Interstate

Bank of Denver, N.A., 511 U.S. 164 (1994) .o...ccccccccececeees 6

City of Boerne v Flores, 117 S. Ct. 2157 (1997) .............. 23

City of Chicago v Lindley, 66 F.3d 819 (CA7 1995) .......... 8

Cort v Ash, 422 U.S. 66 (1975) ........cccccccssccsscsccssesses passim

David K. v Lane, 839 F.2d 1265 (CA7 1988) ...........000. 7,11

Vii

Drake v Delta Air Lines, Inc., 147 F.3d 169

Ee EUIPUED ‘cnientenstionchuibiatintescaensiienintentiieniaianesitaminndididlicasad 14, 15

Ernst & Ernst v Hochfelder, 425 U.S. 185 (1976) ............. 6

Ferguson v Charleston, No. 97-2512, 1999

U.S. App. LEXIS 15611 (CA4 July 13, 1999) 00. 7

Georgia State Conference of Branches of NAACP

v Georgia, 775 F.2d 1403 (CAI11 1985) .0........ccccccccceeees 11

Guardians Association v Civil Service Commission

of New York City, 463 U.S. 582 (1983) oo... passim

Larry P. v Riles, 793 F.2d 969 (CA9 1984) 0.0.00. 7,11

Lau v Nichols, 414 U.S. 563 (1974) ........cccccccccsesssssscsseceeee 9

Lowrey v Texas A&M University System,

Be eee I TUT caisehabiniasuinnidiisaaaiepnidecstiinasssdlonids 15

Lujan v Defenders of Wildlife,

es I edeanadteiacleishcs cde sehanpictiakasinailiiginbeciezhasiondin 24

Marks v United States, 430 U.S. 188 (1977) ......ccccccccccceee 8

New York Urban League v New York,

Fe I ths tiiinictenchacentintcdedesonannseninicntin 7

Reiter v Cooper, 507 U.S. 258 (1993) ............cccccceeeceeseeees 22

Robertson v Dean Witter Reynolds,

ee pe A, EAI Ra ce ODT 15

vill

Sandoval v Hagan, 7 F .Supp.2d 1234

ees Heels, OPTED iciicnscisesistnabssesicbsiiesdetabiniatitehibaianinidentneensdnatniecsshaie 7

Seif v Chester Residents Concerned for Quality

Living, 132 F.3d 925, 118 S. Ct. 2296 (1998) ........... passim

Seminole Tribe of Florida v Florida,

es ks Ee I wise ta theeiihcccetcndatisnsessssnceniinans 22, 23

Steel Co. v Citizens for Better Environment,

ee es Gs ee CE salable tieticdintarieddinsdnivisnibenionnsosicinncaeh 28

Thompson v Thompson, 484 U.S. 174 (1988) ............. 19

Touche Ross & Co. v Redington,

a Se a Se TE abibactiecdesiitisctdssentpsanakisciccnalencdbiiaes 19, 20

Transamerica Mortgage Advisors v Lewis,

rs Be re ace desaehsciiehn asinine inctnickicenie 18, 20

University of California Regents v Bakke,

re ee ee EE sek tecircdhninadibinticcinsicedbtdibadaieseds passim

Villanueva v Carere, 85 F.3d 481 (CA10 1996) ............... 7

iX

STATE CASES

Bismarck Public School District #1 v North Dakota,

FEE IN W.26 247 DD. UGG) vrceccsvchecdsicccencdsccacsecseeses..... 12

Brigham v Vermont, 692 A.2d 384 (Vt. Sk RRR ELER Ee ae 12

Committee for Educational Rights v Edgar,

OFS POT DATO GI IUD iis iccciccstntaikensinecssenctrsassoceces 1]

Danson v Casey, 399 A.2d 360 (Pa. 1979) .o.cceccccccscecees 2, 11

Serrano v Priest, 557 P.2d 929 (Ca. 1977) voccccccccccccccssseee. 1]

DOCKETED CASES

Friends of the Earth v Laidlaw Environmental

Ber veaG, Bae. MO. GBOBZ2 avcccasscscoccocsasvesecscseescssesssas,...., 28

Powell v Ridge, No. 98-1223 (E.D. Pa. 1998) .....cccccccccsseee. l

Powell v Ridge, No. 98-2096 (CA3 1999), 1999

U.S. App. LEXIS 20092, 1999 WL 643364 ......cccccccccs. 1,24

Sandoval v Hagan, No. 98-6598 (CA11 pending) ........... 22

Seif v Chester Residents Concerned for Quality

PN I I 5, 10

FEDERAL STATUTES

cat PUI ciao Oe tT 6

USL. 6 1TI ube eceilciideeecaan l

42 USA.) TU sitdsienie 4,5

G2 UGB. © DE ssincitcniscsasasiacatsairassaiceessidluammiisiel passim

Private Securities Litigation Reform Act of 1995, Pub. L.

1O4-G7,, SOD Dank: TSF CGI scicncsininscticectinistauccieishaabbaticcid 6

CONSTITUTION

CFS. COODURT,, AMI TEE Oo seca te scatncpicekiinitinannipacicbiaen 23

FEDERAL REGULATIONS

7 CPR. § RO iicdsciiinitmaaiiaiaae 6

POC A © TE. cancsnnnesastnnieniaeemaien 21, 23

DO CE Ri VE sition 16, 21

FEDERAL RULES

SUN. TE, EG I EE sc igcecdseectntieasaheee Ateiscqnunssbtaenpsbadennmenauinaaaia 4

STATE STATUTES

a4 PA. STAT. ADGA © SOLS OE Ie csscccsasmniisssuhchssnnsentiienstnaane 2

xi

MISCELLANEOUS

Gilbert Paul Carrasco, Public Wrongs, Private Rights:

Private Attorneys General for Civil Rights, 9 VILL.

BN ie Be i Ry, De ME RID ehiccstsncsnin sais scheshssnaceancees 14

Bradford C. Mank, Js There a Private Cause of Action

Under EPA's Title VI Regulations?: The Need to

Empower Environmental Justice Plaintiffs,

2A COLUM. 3, ERIV TL. 1, 1 (1GG9) oon... cccsecccccaccesccosesscocsesee 13

R. Gregory Roberts, Environmental Justice and

Community Empowerment: Learning from the Civil

Rights Movement, 48 Am. U. L. REV. 229 (1998) ............ 13

Amanda C.L. Vig, Using Title VI to Salvage Civil

Rights from Waste: Chester Residents Concerned

for Quality Living v. Seif, 132 F.3d 925, 67 U.

a i I oar 13

Jimmy White, Environmental Justice: Is Disparate

Impact Enough?, 50 MERCER L. REV. 1155 (1999) ......... 13

Petitioners respectfully request that a writ of

certiorari issue to review the judgment of the United States

Court of Appeals for the Third Circuit.

OPINIONS BELOW

The decision of the U.S. Court of Appeals for the

Third Circuit in Powell v Ridge, 98-2096 (Appendix A at

la), is not yet published in the Federal Reporter 3d but is

reported online at 1999 U.S. App. LEXIS 20092 and 1999

WL 643364. The decision of the U.S. District Court for the

Eastern District of Pennsylvania in Powell v Ridge, No. 98-

1223 is not reported (Appendix B at 35a).

JURISDICTION

This petition is filed within 90 days after the court

of appeals entered its judgment on August 25, 1999. This

Court has jurisdiction under 28 U.S.C. § 1254(1). The

constitutionality of a statute is not at issue.

STATUTORY PROVISIONS INVOLVED

The federal statutory and regulatory provisions

involved include the following: Sections 602 and 603 of

the Civil Rights Act of 1964, 42 U.S.C. §§ 2000d and

2000d-1, 34 C.F.R. § 100.3, 34 C.F.R. § 100.7 and 24 Pa.

STAT. ANN. § 2502.35 (Appendices C, D, E, F and G at

65a, 66a, 68a, 73a and 75a). The state and local

expenditures at issue are established by state statute or local

ordinance.

STATEMENT OF THE CASE

A. Factual Background

Philadelphia’s School District is the largest of the

501 public school districts in the Commonwealth of

Pennsylvania, with 12 per cent of all public school students

in the Commonwealth.'! The School District has three

principal sources of revenue: local taxes, subsidies from

the Commonwealth and federal grants.” The School

District obtains approximately half of its overall operating

budget from local tax revenues. The remainder of its

revenue consists of Commonwealth subsidies and federal

grants.”

The Commonwealth’s basic education subsidy for

its public schools is determined through a statutory formula

established by the Pennsylvania General Assembly.* For

the 1997-1998 school year, the state subsidy for each

school district was the amount received for the previous

The facts in this petition are taken from the complaint and

from legislative enactments, such as state and local appropriations and

budget measures. They have not been included in the appendix,

because of their length.

2 . ° ° ° .

Public school funding mechanisms in Pennsylvania are

established by statute. The funding mechanisms are also described

generally in state-court decisions. See, e.g., Danson v Casey, 399 A.2d

360 (Pa. 1979).

3

See 1997/1998 Budget Reports of Revenue and Expenditure

Data for the Philadelphia School District (submitted to the

Pennsylvania Department of Education on September 11, 1997)

(showing estimated revenue for the 1997-98 school year of

$1,521,725,429, only $606,209,000 of which came from the

Commonwealth).

24 PA. STAT. ANN. § 25-2502.35 (reprinted in Appendix G ).

4

3

year plus a “base supplement” that considered a school

district’s taxable real property and personal income, a

“growth supplement” and a “poverty supplement”

determined by the number of children in low-income

families residing in the district. The formula results in

school districts receiving varying levels of state subsidy per

student, rather than a flat amount per district or per

student.° However, the formula is facially neutral with

regard to race and ethnicity.

Philadelphia, like every school district, is not

obligated to match the state subsidy with local spending.

Philadelphia may increase or lower its own spending on

public schools without regard to the state subsidy. If it

were to receive an increase in its state subsidy, Philadelphia

would have the discretion to lower its own spending on its

public schools by an equal amount or more.

Plaintiffs alleged two causes of action. The first

count was based on a regulation promulgated by the federal

Department of Education under Section 602 of Title VI of

the Civil Rights Act of 1964, 42 U.S.C. § 2000d-1. The

regulation prohibits a recipient of federal funds from

administering a program in a manner that has a disparate

impact on a racial or ethnic basis, even if the impact is

inadvertent.’ The regulation does not state any grounds

: The state appropriation to school districts for basic education

in FY 1998-1999 was $3.5 billion. General Appropriation Act of

1998, Act No. 1998-6A.

Philadelphia, for example, has 12 per cent of the

Commonwealth’s public school children yet receives about 18 per cent

of the total state subsidy for basic education. Supra note 3. If the

subsidy were given on a flat, per-student basis, Philadelphia would

obviously get less.

Appendix E at 69a.

4

upon which such disparate impact may be excused or

justified. The second count alleged a violation of the Civil

Rights Act of 1871, 42 U.S.C. § 1983, based on the

purported violation of the regulation.

Plaintiffs alleged that the total funding of the

Philadelphia School District, from all sources, was

substantially less per student than in some suburban school

districts. Because a majority of Philadelphia’s public

school children are non-white and a majority of the

students in the suburban districts are white, the complaint

alleged that there was an actionable disparate impact under

the agency regulation. Additionally, the complaint alleged

that, among an unspecified number of school districts

around the state with comparable levels of. student poverty,

those with large non-white student bodies received less

Commonwealth subsidy per student than those with largely

white student bodies.

Although the complaint selectively used statistics,

the complaint did not compare Philadelphia with all school

districts in the state, either as to per-student state subsidies

or as to total per-student revenue from all sources. The

complaint also did not compare Philadelphia with other

school districts that have not just a similar level of student

poverty but also a similar level of locally-taxable real

property and personal income.

B. Proceedings Below

The action commenced on March 9, 1998, in the

United States District Court for the Eastern District of

Pennsylvania. Both the Executive Parties and the

intervening Legislative Parties filed dispositive motions

under FED. R. Civ P. 12.

5

Shortly thereafter, this Court summarily disposed of

Seif v Chester Residents Concerned for Quality Living, No.

97-1620, vacating the judgment of the Third Circuit on a

suggestion of mootness. 119 S.Ct. 22 (1998). In Chester

Residents, the Third Circuit had found an implied private

right of action to enforce disparate-impact regulations

promulgated by federal agencies under Section 602 of Title

VI, 42 U.S.C. § 2000d-1. 132 F.3d 925 (CA3 1997).

The defendants in this case filed supplemental

motions in the district court raising the same issue as in

Chester Residents.

The district court found the Third Circuit’s vacated

holding in Chester Residents persuasive and held that Title

VI regulations could give rise to private actions.

(Appendix B at 61a-62a). However, the district court held

that the complaint failed to state a claim of disparate impact

and that the complaint failed to state a claim under Section

1983 because none of the defendants were “persons” for

purposes of that statute. (Appendix B at 44a-45a).

Plaintiffs appealed to the Third Circuit, which

reversed the district court and refused to affirm on alternate

grounds urged by the appellees. (Appendix A at la). It

held that the disparate-impact regulations were valid, that

there was an implied private right of action, that all

plaintiffs had standing and that the complaint stated a

claim. It also held that an action under Section 1983 could

be maintained for violation of the regulation.

6

REASONS FOR GRANTING THE PETITION

I. WHETHER A REGULATION MAY PROHIBIT

UNINTENTIONAL DISPARATE IMPACTS WHEN

THE UNDERLYING STATUTE PROHIBITS ONLY

INTENTIONAL DISCRIMINATION IS AN

IMPORTANT ISSUE AND THE THIRD CIRCUIT’S

CONCLUSION IS INCONSISTENT WITH RECENT

AUTHORITY OF THIS COURT.

Title VI of the Civil Rights Act of 1964, 42 U.S.C.

§§ 2000d, ef al., prohibits only intentional racial or ethnic

discrimination by recipients of federal funding. University

of California Regents v Bakke, 438 U.S. 265 (1978);

Guardians Association. v Civil Service Commission of New

York City, 463 U.S. 582, 607-08 (1983) (opinion of Powell,

J., in which Burger, C. J., and Rehnquist, J., joined); 463

U.S. at 612 (opinion of O’Connor, J.); 463 U.S. at 634

(opinion of Stevens, J., in which Brennan and Blackmun,

JJ., joined). Section 602 of Title VI authorizes regulations

“to effectuate the provisions” of Section 601.

Regulations must be within the scope of the

statutory delegation to the agency. In Central Bank of

Denver, N.A. v First Interstate Bank of Denver, N.A., 511

U.S. 164 (1994), for example, the Court held that a private

plaintiff could not bring a claim under Rule 10b-5, 17

C.F.R. § 240.10b-5, for conduct that would not be

prohibited by the enabling statute, Section 10 of the

Securities Exchange Act of 1934, 15 U.S.C. § 78). 511

U.S. at 173.5 In Ernst & Ernst v Hochfelder, 425 U.S. 185

. A part of the holding in Central Bank that is not material here

was superseded by statute. See Private Securities Litigation Reform

Act of 1995, Pub. L. 104-67, 109 Stat. 737 (1995).

7

(1976), the Court held that, because the enabling statute

required proof of scienter to impose liability, a regulation

could not permissibly impose liability based only on proof

of negligence.

Yet despite Bakke, Guardians and the scope of Title

VI, more than 40 federal agencies have promulgated

regulations — purportedly under the authority of Title VI —

that prohibit unintentional disparate impacts on racial or

ethnic groups. See Alexander v Choate, 469 U.S. 287, 294

(1985). Those regulations affect virtually every part of our

society. See, e.g., Powell (education funding); Chester

Residents, 132 F.3d 925 (environmental permitting); New

York Urban League v New York, 71 F.3d 1031 (CA2 1995)

(mass-transit fares); Ferguson v Charleston, No. No. 97-

2512, 1999 U.S. App. LEXIS 15611 (CA4 July 13, 1999)

(drug testing); Villanueva v Carere, 85 F.3d 481 (CA10

1996) (transfer of students to charter school); City of

Chicago v Lindley, 66 F.3d 819 (CA7 1995) (health care

for the elderly); David K. v Lane, 839 F.2d 1265 (CA7

1988) (prison rules); Larry P. v Riles, 793 F.2d 969 (CA9

1984) (IQ testing); Sandoval v Hagan, 7 F.Supp.2d 1234

(M.D. Ala. 1998) (driver licensing); and Bryant v New

Jersey Dep't. of Transportation, No. 97-1397, 1998 U.S.

Dist. LEXIS 1847 (D.N.J. Feb. 17, 1998) (highway siting).

In Guardians, the Court touched on, but did not

resolve, the question of whether Title VI disparate-impact

regulations are valid given that the underlying statute bars

only intentional discrimination. Justice O’Connor wrote in

her concurrence that

[i]f, as five Members of the Court concluded in

Bakke, the purpose of Title VI is to proscribe only

purposeful discrimination in a program receiving

federal financial assistance, it is difficult to fathom

how the Court could uphold administrative

regulations that would proscribe conduct by the

recipient having only a discriminatory effect. Such

regulations do not simply “further” the purpose of

Title VI; they go well beyond that purpose.

463 U.S. at 613 (O’Connor, J., concurring). The

importance of Justice O’Connor’s concern is highlighted by

the fact that, since Guardians, plaintiffs have often made

disparate-impact claims under Title VI regulations that they

could not have made under the statute itself, a fact made

plain by the list of cases on the preceding page.

The Third Circuit misinterpreted Guardians to hold

that such disparate-impact regulations are valid. (Appendix

A at 22a). While it is true that five Justices suggested in

Guardians that such regulations could be valid, there was

no holding to that effect. “When a fragmented Court

decides a case and no single rationale explaining the result

enjoys the assent of five Justices, ‘the holding of the Court

may be viewed as that position taken by those Members

who concurred in the judgments on the narrowest

grounds...."” Marks v United States, 430 U.S. 188, 193

(1977) (citation omitted). Of the five Justices in Guardians

who opined that Title VI regulations could prohibit

disparate impacts, four were in dissent (Marshall, Stevens,

Brennan and Blackmun, JJ). Contrary to the Third

Circuit’s contention in this case, Guardians did not hold

-

9

that disparate-impact regulations are valid and, in fact, this

Court has never reached that conclusion.”

There is only one decision by this Court that could

be read to ratify disparate-impact claims under Title VI:

Lau v Nichols, 414 U.S. 563 (1974). However, as several

concurring Justices noted in Guardians, to the extent Lau

included such a holding, it was implicitly overruled by

Bakke. See Guardians, 463 U.S. at 611 n.4 (opinion of

Powell, J., concurring in the judgment and joined by

Burger, C.J., and Rehnquist, J.) and 463 U.S. at 615

(opinion of O’Connor, J., concurring in the judgment)."°

This case presents the Court with an opportunity to

make explicit what Bakke made implicit: Lau is no longer

good law. Moreover, the Court has never passed on the

validity of any of the more than three dozen disparate-

impact regulations promulgated under the authority of Title

VI. Because these regulations are increasingly the bases for

private actions in the federal courts, the Court should take

Part of the confusion arises from dictum in Justice Marshall's

opinion in Alexander v Choate, 469 U.S. 287, 293 (1985), in which he

wrote that Guardians “held” that the regulations could prohibit

disparate impacts. In the context of Alexander, his statement was

dictum. Moreover, it was a mistaken characterization of another case,

rather than a holding or dictum arising from Alexander itself.

” In Lau, Justice Douglas used regulations as a guide to

conclude that a disparate impact could violate Title VI itself. 414 U.S.

at 566 (“We do not reach the Equal Protection Clause argument which

has been advanced but rely solely on § 601 of the Civil Rights Act of

1964, 42 U.S.C. § 2000d, to reverse the Court of Appeals.”). Bakke’s

holding that the statute only reaches intentional discrimination

undercut the basis for the Law decision.

10

this occasion to resolve that which has generated so much

confusion in the 16 years since it decided Guardians.""

ll. THE COURT SHOULD DECIDE WHETHER

PLAINTIFFS CAN BYPASS THE FEDERAL

AGENCY THAT OVERSEES A_ SPENDING

PROGRAM AND ASSERT A PRIVATE CAUSE OF

ACTION UNDER “DISPARATE-IMPACT”

REGULATIONS.

A. It is a question of national importance that

affects innumerable federal, state and local

programs.

This case presents the same question on which the

Court issued a writ of certiorari to the Third Circuit in Seif

v Chester Residents Concerned for Quality Living, 118

S.Ct. 2296 (1998). On August 17, 1998, the Court acted on

a suggestion of mootness and dismissed that case. 119

S.Ct. 22 (1998). The petition in Chester Residents framed

the issue as follows:

Did Congress intend to create a private cause of

action in federal court that bypasses a federal

agency’s review and enforcement process under

Section 602 of Title VI of the Civil Rights Act of

1964, simply by alleging a discriminatory effect in

the administration of programs and activities of a

federally-funded State or local agency?

¥ In the years since Guardians, plaintiffs have filed dozens of

private actions in the federal courts based on Title VI disparate-impact

regulations. Some of the more prominent cases are listed on Page 7,

supra.

co Y

1]

This case presents both the same issue and the same

result in the court of appeals as in Chester Residents. All

of the reasons underlying the Court’s decision to accept

review in that case apply with equal force in this case.

The preceding section of this petition describes the

broad spectrum of areas affected by Title VI disparate-

impact regulations, from education to the environment to

highway siting to drug testing to drivers’ licensing.

However, this Court has yet to pass on the validity of those

regulations or whether they may give rise to private

actions.

The Court decided to provide guidance in Chester

Residents but was unable to do so. When the question

arises in environmental and other regulatory siting

programs, it will often escape review, because the

applicant, when faced with expensive delay, may be able to

withdraw the project from consideration and go to another

locality. This case presents no such threat of mootness, a

fact made plain by the lengthy litigation in Pennsylvania

state courts regarding funding for the Philadelphia schools.

See, e.g., Danson v Casey, 399 A.2d 360 (Pa. 1979). The

Court should settle this significant legal issue."”

This case also has national importance in another

dimension. If plaintiffs can bring suits such as this, the

= This case and Chester Residents present the only circuit-court

cases to analyze the issue of whether to imply a private action under

Title VI regulations. The remaining cases seem to assume, without

deciding, that there is a private right of action. See, e.g., Castenada by

Castenada v Pickard, 781 F.2d 456 (CAS 1986); Buchanan v City of

Bolivar, Tenn., 99 F.3d 1352 (CA6 1996); David K., 839 F.2d 1265;

Larry P, 793 F.2d 969; and Georgia State Conference of Branches of

NAACP v Georgia, 775 F.2d 1403 (CAI1 1985).

}

:

'

'

12

States will be unable to subsidize public education, or to

spend for other social welfare purposes, on anything other

than a flat per-person basis without being besieged by

litigation in the federal courts.

Like Pennsylvania, most States use multi-part

formulas to determine how much funding to distribute to

school districts. See, e.g., Serrano v Priest, 557 P.2d 929,

933 (Ca. 1977) (California); Committee for Educational

Rights v Edgar, 672 N.E.2d 1178, 1180-81 (Ill. 1996)

(Illinois); Bismarck Public School District #1 v North

Dakota, 511 N.W.2d 247, 252 (N.D. 1994) (North Dakota);

and Brigham v Vermont, 692 A.2d 384, 387 (Vt. 1997)

(Vermont). Yet any formula that provides funding on other

than a strictly per-student basis is likely to have a statistical

“disparate impact” for or against some racial or ethnic

group in any State that is not completely homogeneous.

For example, to the extent Pennsylvania’s formula

considers local taxing potential, the affluent, and largely

white, suburban districts must get less per-student from the

Commonwealth than Philadelphia. Under the precedent

established by the Third Circuit, those suburban districts

would have an actionable claim of “disparate impact, ’

because the regulations do not apply only to minorities.

They apply to everyone — since we all have a race, color or

national origin — who could show a statistical disparity on

that basis. The Commonwealth would find itself frustrated

in attempting to consider disparate needs that range from

those of small rural school districts in its poor Appalachian

counties to those of its large urban school districts, \viiich

can combine high-value taxable commercial realty and high

personal income with inner-city poverty. If the Third

Circuit’s decision stands, the Commonwealth faces

potentially 500 more federal lawsuits filed by school

a SEE Tee ee

13

districts other than Philadelphia. Other States will be

similarly affected.

The agency regulation at issue in this case provides

no guidance as to how to resolve the tension between its

facial, blanket prohibition on disparate impact and the

many disparate needs that the States must consider in

structuring their programs. This might not in itself be a

problem as long as the agency were the only party with

standing to question the conduct of the recipients of its

funding. The agency could examine the circumstances of

any important case, articulate its policy considerations and

exercise its discretion to seek changes in the way its money

is spent or to cancel the funding entirely.

The precedent established by the Third Circuit

invites myriad private suits, which the courts will have to

decide without agency expertise to guide their

deliberations. | Not surprisingly, the Third Circuit’s

decision in Chester Residents was regarded by many as a

call to litigation.’ With the vacatur of Chester Residents,

this case is now the only circuit case to explicitly hold that

private plaintiffs may enforce Section 602 disparate-impact

regulations.

ss See, e.g., Bradford C. Mank, /s There a Private Cause of

Action Under EPA's Title VI Regulations?: The Need to Empower

Environmental Justice Plaintiffs, 24 COLUM. J. ENVTL. L. 1 (1999);

Jimmy White, Environmental Justice: Is Disparate Impact Enough?,

50 MERCER L. REV. 1155 (1999); Amanda C.L. Vig, Using Title VI to

Salvage Civil Rights from Waste: Chester Residents Concerned for

Quality Living v. Seif, /32 F.3d 925, 67 U. CIN. L. REV. 907 (1999);

and R. Gregory Roberts, Environmental Justice and Community

Empowerment: Learning from the Civil Rights Movement, 48 AM. U.

L. REV. 229 (1998).

14

Accordingly, this case is likely to take Chester

Residents’ place as the foundation for such private actions

nationwide. The outcomes in those cases are quite likely to

be at variance with what the agencies would do if they

exercised their primary jurisdiction. Because the regulation

applies to disparate impacts on all races and ethnic groups,

not just to impacts on members of minority groups, the

Third Circuit's approach is more likely to harm members of

minority groups than it is to help them in education and

social welfare programs.

B. Courts of appeals have used different tests

to find an implied private right of action in agency

regulations.

The Court has not yet provided a mode of analysis

for determining when to find an implied private right of

action to enforce a regulation.'* Without that guidance, the

courts of appeals have adopted a variety of tests that

consider materially different factors.

In this case, the Third Circuit used the test it

developed in Angelastro v Prudential-Bache Securities,

764 F.2d 939 (CA3 1985), for determining whether to infer

the existence of a private right of action to enforce a

regulation. (Appendix A at 16a). The elements of the

Angelastro test are: (1) whether the statute under which the

regulation was promulgate! could itself engender a private

action; (2) whether the agency rule is properly within the

scope of the enabling statute; and (3) whether implying a

14

See Gilbert Paul Carrasco, Public Wrongs, Private Rights:

Private Attorneys General for Civil Rights, 9 VILL. ENVTL. L.J. 321,

323 n.10 (1998) (“To date, the Supreme Court has not articulated a

specific test.”’).

15

private right of action will further the purposes of the

enabling statute.

The Second Circuit has also adopted a three-

pronged test developed by one of its district courts, but the

prongs are materially different than those in the Third

Circuit’s test. Drake v Delta Air Lines, Inc., 147 F.3d 169

(CA2 1998), looked at (1) whether the enabling statute was

silent with respect to the existence of a private right of

action to enforce the regulations; (2) whether there was an

administrative enforcement mechanism in place to address

alleged violations of the regulations; and (3) whether rights

were created in the statute for a specific class of persons."

The Ninth Circuit has a two-part test for

determining whether regulations give rise to a private right

of action: (1) whether Congress delegated authority to

establish rules implying a private right of action; and (2)

whether the rule in question was drafted such that a private

right of action is legitimately implied. See Robertson v

Dean Witter Reynolds, 749 F.2d 530, 536 (CA9 1984).

The Fifth Circuit has merely used the four-part test

of Cort v Ash, 422 U.S. 66 (1975). Its decision in Lowrey

v Texas A&M University System, 117 F.3d 242 (CAS

1997), assumes that the factors for inferring a private right

of action in a regulation are the same as those for a statute.

15

The Second Circuit adopted the district court’s analysis,

affirming the refusal to find a private right of action under the Federal

Aviation Administration’s drug-testing regulations. Drake, 147 F.3d at

170. The Second Circuit noted “that Drake could have sought redress

of the alleged regulatory violations through administrative avenues,

such as by filing a complaint with the Secretary of Transportation.” /d

at 171.

16

The courts of appeals have all developed their tests

either by analogizing to Cort or, as in the Fifth Circuit, by

simply applying Cort without regard to any inherent

distinctions between the lawmaking and _ rulemaking

functions. However, despite all having started with Cort,

they have diverged in a material way. The Third, Fifth and

Ninth Circuits seem to give no weight whatsoever to the

existence of administrative avenues for resolving a

complaint.

For example, in this case, the Third Circuit's

opinion does not mention the existence of an administrative

process, yet the statute that authorizes regulations also

makes it a predicate for taking action that the “agency

concerned has advised [the recipient] of the failure to

comply with the requirement and has determined that

compliance cannot be secured by voluntary means.” 42

U.S.C. § 2000d-1 (Appendix D at 67a). Likewise the

agency regulations applicable to this case authorize the

filing of an administrative complaint against a recipient of

federal funds. 34 C.F.R. § 100.7(b) (Appendix G at 73a).

By contrast, the Second Circuit’s approach would

give great weight to the availability of such administrative

avenues.

In overlooking the availability of administrative

avenues for complaint resolution, the Third, Fifth and

Ninth Circuits place no value on the principle of primary

jurisdiction. As this Court noted in Afchison, Topeka &

Sante Fe Railway Co. v Wichita Board of Trade, 412 U.S.

800, 820-21 (1973), a transportation-rate case, “National

transportation policy reflects many often-competing

interests. Congress has established an administrative

agency that has developed a close understanding of the

I a a i ok —

17

various interests and that may draw upon its experience to

illuminate, for the courts, the play of those interests in a

particular case.” 412 U.S. at 820-21. Agencies, moreover,

often must apply two or more statutes simultaneously, to

achieve multiple program objectives. This is such a case,

since Section 602 of Title VI, while authorizing

regulations, requires that they “be consistent with

achievement of the objectives of the statute authorizing the

financial assistance.” 42 U.S.C. § 2000d-1 (Appendix D at

66a).

Petitioners do not here suggest the proper test for

finding an implied right of action in agency regulations.

Petitioners do suggest that the bypassing of the

administrative process that can result from it is an

important issue that should be addressed by the Court.

G The Third Circuit erred in determining

that disparate-impact regulations under Title VI

could support private actions.

l. The court of appeals looked to the

wrong enabling statute.

The Third-Circuit panel in Chester Residents

examined the first Angelastro element by employing the

test set out by this Court in Cort, and examining Section

602 of the Civil Rights Act. The panel in this case largely

ignored that analysis. Instead, it concluded that the

“enabling statute” was not Section 602 but Section 601

(Appendix A at 20a). The court then pointed to this

Court’s authority, and its own, for the proposition that

Section 601 of Title VI gives rise to a private right of

action. /d. With that machination, the court concluded that

the first step of the Angelastro test was met. It then

18

summarily noted that “[w]e are persuaded by the analyses

in Chester Residents that the second and third prong[s] of

Angelastro are also met.” (Appendix A at 20a).

The Third Circuit’s analysis looked to the wrong

“enabling statute.” Had it looked to the correct provision — ;

Section 602 — and applied the Cort test to that provision, |

the court would have reached a different result. Instead, the :

court of appeals erroneously determined that Section 601 is

the statute that enables agencies to promulgate regulations.

The flaw in that reasoning is evident in the plain language

of the provision. Nothing in Section 601 hints even

remotely at authorizing or directing agencies to do anything

at all (Appendix C at 65a). Section 602, on the other hand,

explicitly mandates agency action. See 42 U.S.C. § 2000d-

1 (“Each Federal department and agency which is

empowered to extend Federal financial assistance to any

program or activity, by way of grant, loan, or contract other

than a contract of insurance or guaranty, is authorized and

directed . . .”) (Appendix D at 66a). Section 601 does not

enable agencies to do anything — Section 602 does. '®

The Third Circuit’s response to that plain language

was to conflate the two provisions: “As noted above, the

regulation at issue here, although promulgated by the

Department of Education under section 602 of Title VI,

implements section 601 of Title VI.” (Appendix A at 20a).

16

In analyzing statutes for an implied private right of action, this

Court has treated different sections of the same statute differently.

Transamerica Mortgage Advisors v Lewis, 444 U.S. 11, 19 (1979)

(Court found that Section 215 of the Investment Advisers Act of 1940

gave rise to private actions while Section 206 of the same act did not.).

19

It is inappropriate to conclude that the implied right

of action in Section 601 can be imported into Section 602.

This Court has held that Section 601 reaches only

purposeful discrimination. Bakke, 438 U.S. at 287.

Accordingly, any private right of action implied in Section

601 relates only to claims of intentional discrimination.

The regulation at issue in this case proscribes unintentional

policies that result in disparate impacts and, so, Section

601’s implied private action is a poor — and inappropriate —

fit.

In fact, the Third Circuit erred in this case by not

applying the Cort analysis to Section 602. Cort asks (1)

whether the plaintiffs are part of the class for whose

“especial” benefit the statute was created; (2) whether there

was any indication of congressional intent to deny or create

a private remedy; (3) whether the implication of a private

remedy is consistent with the underlying purpose of the

Statute; and (4) whether the matter is one traditionally

relegated to the states. 422 U.S. at 78. The second issue,

legislative intent, is to be given the greatest weight.

Touche Ross & Co. v Redington, 442 U.S. 560, 575 (1979).

In Thompson v Thompson, 484 U.S. 174 (1988), the Court

explained that “[t]he intent of Congress remains the

ultimate issue, however, and ‘unless this congressional

intent can be inferred from the language of the statute, the

Statutory structure, or some other source, the essential

predicate for implication of a private remedy simply does

not exist."” 484 U.S. at 179 (quotation omitted).

As noted above, there is nothing in the language or

structure of Section 602 that suggests that Congress

intended for there to be private actions to enforce the

regulations described in that section. Indeed, the only

remedy described expressly in Section 602 is a termination

20

of a wrongdoer’s federal funding by the promulgating

agency (Appendix D at 66a). “[I]t is an elemental canon of

statutory construction that where a statute expressly

provides a particular remedy or remedies, a court must be

chary of reading others into it.” Lewis, 444 U.S. at 19.

The legislative history of Section 602 — which the

Third Circuit ignored — bolsters this conclusion. There is

nothing in that history to suggest that Congress intended, or

even contemplated, that private persons would file lawsuits

predicated on regulations and there is much that points to

the contrary. Touche, 442 U.S. at 571-76 (a lack of

evidence of legislative intent to create a private right of

action, either express or by implication, can by itself

provide the answer that a private right of action should not

be implied.).

ya The disparate-impact regulation is

impermissibly beyond the scope of the

statute.

The second inquiry in the Angelastro analysis

prescribed by the Third Circuit is whether the regulation is

within the scope of the enabling statute. As noted in

Section I of this petition, the regulation is not within the

scope of Section 602 (or, for that matter, of Section 601).

3. Implying a private right of action

to enforce disparate-impact regulations

would not be consistent with the purposes

of the enabling statute.

Both the Third Circuit’s Angelastro analysis and

this Court’s Cort analysis require consideration of whether

implying a private remedy would be consistent with the

21

purpose of the legislative scheme. Cort, 422 U.S. at 78:

Angelastro, 764 F.2d at 947.

In Alexander v Choate, this Court discussed the

place of Section 602 in the legislative scheme of Title VI:

In essence, then, we held [in Guardians] that Title

VI had delegated to the agencies in the first instance

the complex determination of what sorts of

disparate impacts upon minorities constituted

sufficiently significant social problems, and were

readily enough remediable, to warrant altering the

practices of the federal grantees that had produced

those impacts.

469 U.S. at 293-94. The Department of Education

regulations at issue here do not enumerate those things that

would constitute improper disparate impacts. The

regulations do not articulate factors that would justify mere

statistical disparities. Instead, they generally prohibit

“criteria or methods of administration which have the effect

of subjecting individuals to discrimination” and they

describe a mechanism for private persons to file complaints

to initiate agency action. 34 C.F.R. §§ 100.3(a)(2) and

100.7(b). The regulatory scheme itself therefore strongly

suggests that an agency should decide whether the

allegations of a given administrative complaint describe a

disparate impact that violates the regulation. Implying a

private right of action to enforce the regulation bypasses

that agency expertise.'’

Reference to the agency in the first instance is made all the

more appropriate by the fact that Title VI regulations typically include

a straightforward mechanism for aggrieved parties to file complaints

with the agency. As Justice Scalia recently wrote in regard to the

22

Moreover, Section 602 requires that no action be

taken against a fund recipient “until the department or

agency concerned has advised the appropriate person or

persons of the failure to comply with the requirement and

has determined that compliance cannot be secured by

voluntary means.” 42 U.S.C. § 2000d-1. Implication of a

private right of action would entirely bypass that express

notice requirement.

4. Implying a private right of action

to enforce Title VI disparate-impact

regulations has serious federalism

implications.

While not all private actions brought under Title VI

regulations are against state actors, a significant number

are. See, e.g., Powell v Ridge, No. 98-2096 (CA3 1999);

Sandoval v Hagan, No. 98-6598 (CA11 pending). The

application of federal law to the States necessarily

implicates issues of federalism and the Eleventh

Amendment.

Title VI itself purports to abrogate Eleventh-

Amendment immunity, at least for violations of the statute.

42 U.S.C. § 2000d-7. Accepting for purposes of argument

that the statute successfully abrogates sovereign immunity,

the issue then becomes whether an agency rule can

abrogate that immunity for conduct that would not violate

related issue of the exhaustion doctrine, “[w]here relief is available

from an administrative agency, the plaintiff is ordinarily required to

pursue that avenue of redress before proceeding to the courts; and until

that recourse is exhausted, suit is premature, and must be dismissed.”

Reiter v Cooper, 507 U.S. 258, 269 (1993).

23

the statute. The Third Circuit has implicitly answered

“ ”

yes.

The Third Circuit's decision conflicts with recent

authority of this Court that limits abrogation. In Seminole

Tribe of Florida vy Florida, 116 S.Ct. 1114 (1996), the

Court held that Congress could not use its Article | power

to abrogate Eleventh-Amendment immunity. Accordingly,

Congress has only one remaining avenue of abrogation: the

enforcement provision of the Fourteenth Amendment. City

of Boerne v Flores, 117 S.Ct. 2157, 2164 (1997). The

implication in this case is straightforward. Congress

enacted Title VI and, later, added language expressly

abrogating sovereign immunity for actions to enforce the

statute. 42 U.S.C. § 2000d-7. This Court held in

Guardians that the statute reaches only purposeful

discrimination. Accordingly, the abrogation reaches only

purposeful discrimination. Viewed another way, the Third

Circuit implicitly conferred the power to abrogate

immunity on an executive agency, because this Court has

already held that Congress did not itself prohibit disparate

impacts. No agency has the power to abrogate sovereign

immunity. See Seminole Tribe, 116 S.Ct. at 1123

(describing Congress’ ability to abrogate in certain

circumstances); see also, U.S. CONST. amend. XIV, § 5

(“The Congress shall have power to enforce . . .”)."*

> This case demonstrates the danger inherent in such “Article-I!

abrogation.” The Department of Education promulgated regulations

that prohibit disparate impacts, but the regulation includes no

affirmative defenses. 34 C.F.R. § 100.3 (Appendix E at 68a).

24

il. THE COURT OF APPEALS’ DECISION

PROVIDES AN OPPORTUNITY FOR THIS COURT

TO CONSIDER THE APPLICATION OF ASARCO V

KADISH IN A’ SITUATION IN) WHICH THE

SOURCES OF HALF OF THE OVERALL FUNDING

ARE PLAINTIFFS RATHER THAN DEFENDANTS.

To have Article-II standing: (1) the plaintiff must

have suffered an injury in fact — an invasion of a legally

protected interest which is (a) concrete and particularized

and (b) actual or imminent, not conjectural or hypothetical;

(2) there must be a causal connection between the injury

and the conduct complained of — the injury has to be fairly

traceable to the challenged action of the defendant and not

the result of the independent action of some third party not

before the court; and (3) it must be likely, as opposed to

merely speculative, that the injury will be redressed by a

favorable decision. Lujan v Defenders of Wildlife, 504

U.S. 555, 561 (1992).

The Legislative Parties argued below that the

plaintiffs did not have standing because it was wholly

speculative either that any cognizable injury was traceable

to the state funding formula or that the remedy the plaintiffs

request — injunctive and declaratory relief — would redress

their claimed injuries. The Third Circuit disagreed:

The legislative defendants err in assuming that the

injury in this case consists of a lack of adequate

funding. Here, the plaintiffs complain that non-

white school children in Pennsylvania receive less

favorable treatment than their white counterparts

because the state funds the school districts most of

them attend at a lower level than it does the school

districts most white school children attend. A court

25

order directing the state to equalize funding between

these school districts would redress _ this

comparative injury, even if other sources of the

school district’s income were simultaneously

reduced. We therefore conclude that the school

children’s injury is redressable by court order.

(Appendix A at 30a). In so holding, the court of appeals

confused the cause of action with the alleged injury, while

simultaneously misconstruing both the allegations of the

complaint and, more important, this Court's jurisprudence.

The plaintiffs allege that the School District has less

money per student from all federal, state and local sources

than some (but not all) other districts in the

Commonwealth. They also allege that, among a subset of

school districts in the Commonwealth that have comparable

levels of student poverty, those with large minority student

bodies receive less per student from the Commonwealth

than those with a higher proportion of white students. As

noted above, the Commonwealth provides only half of the

funds used to operate the School District; most of the

remainder comes from local taxes authorized by the City of

Philadelphia. In their complaint, quoted by the court of

appeals, the plaintiffs allege the injuries that follow from

this funding situation:

The foreseeable result [of the funding policies] has

been serious impairment of the educational

opportunities of the students in the School District,

including the Student Plaintiffs. Lack of sufficient

resources in the School District results, inter alia, in

larger class sizes and higher pupil-to-teacher ratios

than in surrounding school districts; reduced

curricula; cuts in and elimination of programs and

26

electives and advanced placement courses;

shortages of textbooks; and use of outdated

textbooks; shortages of equipment, supplies and

technology; spartan physical education and

extracurricular programs; lack of librarians and

library services; insufficient numbers of counselors

and psychologists; and many inadequate and

crumbling physical facilities.

(Appendix A at 10a-1la). Because the alleged injury is a

shortage of educational resources, but the substantial local

portion of the total funding can float to whatever level the

local officials see fit, the injury is not fairly traceable to the

level of the state subsidy. The alleged injury is no more

traceable to the state subsidy than it is to deficient funding

provided by the federal government, which should also,

under the Third Circuit's logic, have foreseen the impact of

its funding determinations regarding Philadelphia.

The injury is also not redressable, again because

local officials can offset any increase in state funding with a

decrease in local funding. Indeed, one cannot even say that

any court order equalizing the state subsidy to school

districts on a per student basis would result in a funding

increase to Philadelphia. To the extent that Philadelphia

already receives an above-average subsidy, such an order

would result in a net loss.

Distinguishing the cause of action from the injury

leads to the conclusion that that any relief directed at the

cause of action would not redress the injury. It leads to the

ultimate conclusion that the plaintiffs lack Article III

standing under this Court’s decision in Asarco, Inc. v

Kadish, 490 U.S. 605 (1989).

a

NT ee ee pe Te ee

ee ee ee ee

sameness

27

Yet even if invalidation of the state law would

create increased revenue for the school trust funds

in the near future, an issue much disputed here, the

allegations of economic harm rest on the same

hypothetical assumptions as do the taxpayer claims.

If respondents prevailed and increased revenues

from state leases were available, maybe taxes would

be reduced, or maybe the State would reduce

support from other sources so that the money

available for schools would be unchanged. ... These

policy decisions might be made in different ways by

the governing officials, depending on_ their

perceptions of wise state fiscal policy and myriad

other circumstances. Whether the association's

claims of economic injury would be redressed by a

favorable decision in this case depends on the

unfettered choices made by independent actors not

before the courts and whose exercise of broad and

legitimate discretion the courts cannot presume

either to control or to predict.

490 U.S. at 614-15 (emphasis added). Just as the plaintiffs

in Asarco were without standing because it was largely

speculative that invalidation of the state statute would

redress the asserted injury, so too are the plaintiffs in this

case without standing. It is entirely speculative that the

City — source of half of the funding for the School District

— would maintain its current level of funding. Indeed, in its

capacity as a plaintiff, the City has described its injury as

including a high local tax rate. It is, therefore, likely that

tiie City’s response to an increase in state funding would be

to commensurately decrease local funding to alleviate its

alleged injury. The result, of course, would be that the

School District’s overall funding would change not at all.

Moreover, the remedial effect of an increase in state

28

funding would also rest on the discretionary decisions of

the School District about how to use its money.

Unlike the situation in Asarco, two of the most

important actors on the funding issue are parties to this

litigation. However, these two actors with discretionary

control of funding are plaintiffs rather than defendants: the

City of Philadelphia and the School District. A disparate-

impact claim has not been asserted against them and, on the

facts pleaded, could not be asserted. Therefore this case

presents the Court with an opportunity to determine

whether the holding of Asarco applies with equal vigor to a

situation in which the independent actors with “unfettered

discretion” are, in fact, before the court, but as plaintiffs

rather than as defendants.

The Court has accepted review in other cases that

seek to build incrementally on previous standing decisions.

See Friends of the Earth v_ Laidlaw Environmental

Services, Inc., No. 98-0822, and Steel Co. v Citizens for

Better Environment, 118 S.Ct. 1003 (1998). In addition,

although the Court has recently considered a number of

cases involving standing in a regulatory setting, see, e.g.,

Steel Co., there is a paucity of standing cases arising from

spending-power statutes in programs that do not involve

personal entitlements, although this area of federal activity

is an increasingly important font of federal litigation.

29

CONCLUSION

The Court should grant this petition for a writ of

certiorari.

Respectfully submitted,

DicK THORNBURGH

JOHN P. KRILL, JR. (counsel of record)

LINDA J. SHOREY

DAVID R. FINE

Counsel for Petitioners

SEPTEMBER 24, 1999