Opposition Brief — Haughton v. Wal-Mart Stores, Inc.

Supreras Ro int, U ~ N

No. 02-0670 ZY

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NOV --

In The |

Supreme Court of the Gnit PRK |

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RALSTON HAUGHTON and

MARGARET HAUGHTON,

Petitioners,

V.

WAL-MART STORES, INC.,

Respondent.

¢

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Eleventh Circuit

¢

RESPONDENT’S BRIEF IN OPPOSITION

TO PETITION FOR WRIT OF CERTIORARI

¢

RICHARD A. DUROSE

Counsel of Record

JOHN R. HAMILTON

FOLEY & LARDNER

111 N. Orange Avenue

Suite 1800

Orlando, FL 32801

(407) 423-7656

Attorneys for Respondent

COCKLE LAW BRIEF PRINTING CO. (800) 225-6964

OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED FOR REVIEW

Whether the United States Court of Appeals for the

Eleventh Circuit properly affirmed the district court’s

judgment in favor of the respondent because the respon-

dent’s conduct did not involve the requisite “state action”

necessary to maintain an action pursuant to 42 U.S.C.

Section 1983.

INTERESTED PARTIES AND

CORPORATE DISCLOSURE STATEMENT

Parties to Lawsuit

Margaret Haughton

Ralston Haughton

Wal-Mart Stores, Inc.

Other Interested Persons and Corporate Disclosure

Statement

Hon. L. Lanier Anderson, Judge, U.S. Court of Appeals,

Eleventh Circuit

Hon. Rosemary Barkett, Judge, U.S. Court of Appeals,

Eleventh Circuit

Richard A. DuRose, Esq.

Foley & Lardner

Scott A. Forman, Esq.

John R. Hamilton, Esq.

Hon. Thomas B. McCoun III, U.S. Magistrate Judge,

Middle District of Florida

Hon. Steven D. Merryday, U.S. District Judge, Middle

District of Florida

Michael C. Scher, Esq.

Vernis & Bowling of Miami, P.A.

Wal-Mart de Mexico, S.A. de C.V.

Erin A. Webb, Atty. at Law

Hon. Charles R. Wilson, Judge, U.S. Court of Appeals,

Eleventh Circuit

ill

TABLE OF CONTENTS

Page

QUESTION PRESENTED FOR REVIEW ................ i

INTERESTED PARTIES AND CORPORATE DIS-

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STATEMENT OF BASIS FOR JURISDICTION ....... 1

SILATEMENT OF THE CASE.........cccccscscossoscscsvsesecees 2

ARGUMENTS FOR DENYING THE PETITION...... 4

A. WELL-SETTLED PRINCIPLES OF LAW

AND THE EVIDENCE IN THE RECORD

ESTABLISH THAT WAL-MART WAS NOTA

EE CURT MIEN Spckssiehincsnsh views catanecencinkentcubusessanes

B. THE CASES CITED IN THE HAUGHTONS’

PETITION DO NOT SUPPORT THEIR AR-

GUMENT THAT WAL-MART WAS ACTING

UNDER COLOR OF STATE LAW...................

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iv

TABLE OF AUTHORITIES

CASES

American Mfg’rs Mutual Insurance Co. v. Sullivan,

526 U.S. 40, 119 S. Ct. 977, 143 L. Ed. 2d 130

(Ee Pictnsecsnncinondcsnensiesiasissicsionanenepiaitenaneanentesivennbentnnaes

Blum v. Yaretsky, 457 U.S. 991, 102 S. Ct. 2777, 73

By BAR: THE GG CRD ocesereesavcscesensessctconensesanactnenscsesiaes

Burton v. Wilmington Parking Authority, 365 U.S.

715, 81S. Ct. 856, 6 L. Ed. 2d 45 (1961) .................

Duke v. Smith, 13 F.3d 383 (11th Cir. 1994)................

Edmondson v. Leesville Concrete Company, 500 U.S.

614, 111 S. Ct. 2077, 114 L. Ed. 2d 660 (1991)........

Flagg Brothers, Inc. v. Brooks, 436 U.S. 149, 98

S. Ct. 1729, 56 L. Ed. 2d 185 (1978) ............ cee eeeeeees

Jackson v. Metropolitan Edison Co., 419 U.S. 345,

85 S. Ct. 449, 42 L. Ed. 2d 477 (1974) ..........cccsceeeees

Lombard v. Louisiana, 373 U.S. 267, 83 S. Ct. 1122,

DD Be BR Be Be Ca vine sccvstcnsiccinenernspeacesaneniantons

Lugar v. Edmonson Oil Co., 457 U.S. 922, 102

S. Ct. 2744, 73 L. Ed. 2d 482 (1982) ............ ccc seeeeees

Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 92

S. Ct. 1965, 32 L. Ed. 2d 627 (1972) ............cccseeeeeees

Murray v. Wal-Mart, Inc., 874 F.2d 555 (8th Cir.

NBC v. Communications Workers of America, AFL-

CIO, 860 F.2d 1022 (11th Cir. 1988)... ee

Page

TABLE OF AUTHORITIES — Continued

Rendell-Baker v. Kohn, 457 U.S. 830, 102 S. Ct.

STO4, TS La. Th. Be Gar Ce te tcisesinietinindiininanta 6, 11

Tulsa Professional Collection Services, Inc. v. Pope,

485 U.S. 478, 108 S. Ct. 1340, 99 L. Ed. 2d 565

[Civili Pcecccnvensscenssescstescansevepensesncunanesnidieeandasaecedaaaeaananaaal 8

STATUTES

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1

STATEMENT OF BASIS FOR JURISDICTION

The Haughtons’ lawsuit was originally filed on May

18, 2001, in the Circuit Court of the Twelfth Judicial

Circuit, in and for Sarasota County, Florida. They as-

serted, among other things, a claim under 42 U.S.C.

Section 1983. Record 1:98. On June 13, 2001, Wal-Mart

properly removed the action to the United States District

Court for the Middle District of Florida pursuant to 28

U.S.C. Section 1446(b). Record 1:1.

The district court entered a final judgment in Wal-

Mart’s favor on December 31, 2001. Record 1:100. The

Haughtons filed a motion for reconsideration on January

3, 2002, and a motion for rehearing on January 8, 2002.

Record 1:103; 1:104. The district court entered an order

denying those motions on January 9, 2002. Record 1:106.

On January 16, 2002, the Haughtons filed a notice of

appeal, seeking appellate review by the United States

Court of Appeals for the Eleventh Circuit. The Haughtons

invoked the jurisdiction of the court of appeals under 28

U.S.C. Section 1291, and their notice of appeal was timely

under rule 4(aX1XA) of the Federal Rules of Appellate

Procedure.

The court of appeals affirmed the judgment in Wal-

Mart’s favor through an unpublished decision rendered on

July 19, 2002. Petition for Writ of Certiorari at 26-30. The

Haughtons timely filed a petition for rehearing on August

6, 2002, which the court of appeals denied by an order

entered on September 24, 2002. On October 29, 2002, the

Haughtons filed with this Court a petition for a writ of

certiorari, invoking this Court’s jurisdiction under 28

2

U.S.C. Section 1254(1). The petition was timely under rule

13.1 of the Supreme Court Rules.

eS

_—

STATEMENT OF THE CASE

On February 15, 2001, Ralston and Margaret Haugh-

ton, husband and wife, purchased merchandise from a

Wal-Mart store in Sarasota, Florida. Record 1:98, {4 7-8.

Ms. Haughton presented a personal check as payment for

the merchandise. Record 1:98, {9 7-8. Wal-Mart accepted

the check without hesitation,’ but an employee wrote

“B/F” on the check, signifying that Ms. Haughton is a

black female. Record 1:98, 799-11. The employee also

wrote Ms. Haughton’s drivers license number and date of

birth on the check. Record 1:98, Exh. A.

The notation on the check resulted from a store policy

to record the race, sex, and other identifying information

of those who presented checks for payment. Record

1:64:18. The policy was implemented as a consequence of

contact that store representatives had initiated with the

Florida State Attorney's Office, in which store representa-

tives had sought advice regarding the information that the

state attorney's office would need to prosecute those who

presented worthless checks. Record 1:64:46-51.

Based upon guidelines suggested by the State Attor-

ney’s Office, the Wal-Mart store unilaterally implemented

* The Haughtons do not claim that Wal-Mart refused either to

accept their check or to otherwise do business with them because of

their race. They also claim no economic injury.

3

a policy mandating that all checks presented by customers

be marked with certain information identifying the pre-

senter, including the presenter’s race. Record 1:63:62-63;

1:64:47. Contrary to what the Haughtons imply, the policy

applies to every check, regardless of the race of the person

presenting it. Record 1:63:50-51, 54; 1:65:34. The purpose

of the policy’s adoption was to help alleviate the store’s

problem with returned checks. Record 1:63:62-63; 1:64:47.

The Haughtons filed suit, alleging that the Wal-Mart

employee's act of writing “B/F” on Ms. Haughton’s check

constituted a violation of 42 U.S.C. Section 1983 (“Section

1983”). Record 1:98, {9 14, 19, 27. The Haughtons also

brought state-law claims for emotional distress and loss of

consortium. Record 1:98, {{ 22-31. The parties agree that

the state-law claims are derivative of the Section 1983

claim. See Petition for Writ of Certiorari at 2.

The United States District Court for the Middle

District of Florida entered a summary judgment in Wal-

Mart’s favor, concluding: (1) that the Haughtons were not

subjected to unlawful discriminatory treatment; and (2)

that the Haughtons had failed to show the requisite state

action necessary to maintain a claim under Section 1983.

Record 1:99. In an unpublished opinion, the United States

Court of Appeals for the Eleventh Circuit affirmed solely

on the latter ground, concluding that Wal-Mart did not act

under color of state law. Petition for Writ of Certiorari at

26-30.

ad

4

ARGUMENTS FOR DENYING THE PETITION

A. WELL-SETTLED PRINCIPLES OF LAW AND

THE EVIDENCE IN THE RECORD ESTABLISH

THAT WAL-MART WAS NOT A STATE ACTOR

To prevail on their claim under Section 1983, the

Haughtons were required to establish at least-two sepa-

rate elements: (1) that that they were deprived of a right

secured by the Constitution and the laws of the United

States; and (2) that Wal-Mart deprived them of that right

while acting under color of state law. Flagg Bros., Inc. v.

Brooks, 436 U.S. 149, 155-56, 98 S. Ct. 1729, 1733, 56

L. Ed. 2d 185, 193 (1978). To prove the second element, it

was necessary for the Haughtons to show that Wal-Mart

was a State actor or that its actions were properly attrib-

utable to the state itself. Jd., 436 U.S. at 156, 98 S. Ct. at

1733, 56 L. Ed. 2d at 193; see also American Mfg’rs Mut.

Ins. Co. v. Sullivan, 526 U.S. 40, 50, 119 S. Ct. 977, 985,

143 L. Ed. 2d 130, 143-44 (1999). They wholly failed to

make such a showing. Based on well-established principles

of law, no state action was presented in this case as a

matter of law, and no grounds exist for granting the

Haughtongs’ petition.

The Haughtons’ argument to the contrary is predi-

cated upon their naked assertion that “[t]he record evi-

dence established that Respondent’s policy of writing the

race of the Petitioner on the Petitioners’ check was a result

of compulsion by the state or a symbiotic relationship

under the nexus test.” Petition for Writ of Certiorari at 7.

In truth, however, the record shows unequivocally that

Wal-Mart was not rendered a state actor under either

rationale: it was not compelled by the state to adopt its

check-acceptance policy, and it has no “relationship” with

the state attorney’s office, symbiotic or otherwise.

5

The record unambiguously shows that the Sarasota

Wal-Mart store’s motivation for identifying a customer’s

race on his or her check was to aid the store in alleviating

its problems with returned checks. The only involvement

of the state in that process was that the store solicited the

state attorney’s advice as to the information to include on

checks presented for payment. In that regard, the assis-

tant store manager, Michael Murphy, testified: “I am

merely trying to protect my company, my store, and myself

from a thief or people that don’t want to be honest and

write bad checks. It goes no further than the store.”

Record 1:71:40.

Similarly, the store manager, David Dickerson, testi-

fied: “We put the race and gender of everyone on the back

of the check for the purposes of assisting us in identifica-

tion in the event that we have to pursue collection on a

fraudulent check or returned check.” Record 1:63:6. The

head of the store’s accounting department, Carolyn Shel-

ton, testified: “I did it because that’s what we needed in

order to prosecute checks.” Record 1:65:50.

The record is replete with evidence refuting the

Haughtons’ allegation that the Sarasota Wal-Mart store is

somehow in collusion with the state attorney. On the

contrary, there is absolutely no evidence to support such

an allegation. Indeed, there is no evidence that would even

permit a reasonable inference that the Sarasota Wal-Mart

store would suffer any adverse consequences from the

Sarasota state attorney if it did not identify its customers’

names on their checks. Likewise, there is no evidence that

the state attorney directed the store to write the race of its

customers on their checks. It merely recommended that

the store do so to aid the state attorney in identifying and

prosecuting customers who write worthless checks.

6

Thus, absolutely no evidence of state “compulsion”

exists here. See Rendell-Baker v. Kohn, 457 U.S. 830, 841,

102 S. Ct. 2764, 2771, 73 L. Ed. 2d 418, 428 (1982). More-

over, a state’s mere authorization of, acquiescence in,

encouragement of, or approval of a private action does not

“convert that action into that of the State.” Flagg Bros.,

436 U.S. at 164, 98 S. Ct. at 1737, 56 L. Ed. 2d at 198; see

Sullivan, 526 U.S. at 52, 119 S. Ct. at 986, 143 L. Ed. 2d at

145; Blum v. Yaretsky, 457 U.S. 991, 1004-05, 102 S. Ct.

2777, 2786, 73 L. Ed. 2d 534, 547 (1982).

Nor does such state authorization, acquiescence, or

encouragement create a symbiotic relationship or close

nexus between the state and the private actor. See Moose

Lodge No. 107 v. Irvis, 407 U.S. 163, 173-75, 92 S. Ct.

1965, 1971-72, 32 L.Ed. 2d 627, 638 (1972); see also

Jackson v. Metropolitan Edison Co., 419 U.S. 345, 357-58,

85 S. Ct. 449, 457, 42 L. Ed. 2d 477, 488 (1974). Such a

relationship exists only when the state “has exercised

coercive power or has provided such significant encour-

agement, either overt or covert, that the choice must in

law be deemed to be that of the State.” Sullivan, 526 U.S.

at 52, 119 S.Ct. at 986, 143 L. Ed. 2d at 145 (quoting

Blum, 457 U.S. at 1004, 102 S. Ct. at 2786, 73 L. Ed. 2d at

546). Nothing of that nature exists here. Without eksiare

state action is completely lacking.

B. THE CASES CITED IN THE HAUGHTONS’

PETITION DO NOT SUPPORT THEIR ARGU-

MENT THAT WAL-MART WAS ACTING UNDER

COLOR OF STATE LAW

The cases cited in the Haughtons’ petition are not to

the contrary. All are easily distinguishable from the facts

presented here, and each one in fact illustrates the fatal

deficiencies in the Haughtons’ position. A review of those

cases merely serves to emphasize the vast differences

between this case and the cases in which this Court has

held that state action existed.

For example, in Lombard v. Louisiana, 373 U.S. 267,

83 S. Ct. 1122, 10 L. Ed. 2d 338 (1963), the petitioners

were convicted of violating the Louisiana criminal mischief

statute because they refused to leave a store when re-

quested to do so by the store manager. This Court held

that state action was present because it appeared from

public statements of city officials that they directed

continuance of segregated service in restaurants and

prohibited any conduct directed towards its discontinu-

ance. The evidence thus tended to indicate that the store

official’s actions were coerced by the city. 373 U.S. at 273,

83 S. Ct. at 1125, 10 L. Ed. 2d at 342. In the Haughtons’

case, in contrast, no such coercion is presented.

Likewise inapposite is Burton v. Wilmington Parking

Authority, 365 U.S. 715, 81 S.Ct. 856, 6 L. Ed. 2d 45

(1961). In that case the defendant, a private corporation,

operated a restaurant in a space that it leased in an

automobile parking building owned and operated by an

agency created by the State of Delaware to provide park-

ing facilities. The restaurant constituted an integral part

of the state’s plan to operate the building as a self-

sustaining unit. 365 U.S. at 718-20, 81 S. Ct. at 858-59, 6

L. Ed. 2d at 48-49. The lessee refused to serve the plaintiff

solely on the ground that he was black. 365 U.S. at 720, 81

S. Ct. at 859, 6 L. Ed. 2d at 49.

This Court found that the Equal Protection Clause of

the Fourteenth Amendment was violated by the refusal of

the lessee of a state agency to serve a person because of

. 8

his race. In view of all the circumstances of the case —

including the fact that the restaurant was physically and

financially an integral part of a public building, it was

built and maintained with public funds, it was devoted to

a public parking service, and it was owned and operated

by an agency of the state for public purposes — the state

was a joint participant in the operation of the restaurant.

365 U.S. at 723-25, 81 S. Ct. at 860-63, 6 L. Ed. 2d at 51-

52.

Similar “joint participant” considerations came into

play in Edmondson v. Leesville Concrete Company, 500

U.S. 614, 111 S. Ct. 2077, 114 L. Ed. 2d 660 (1991), Tulsa

Professional Collection Services, Inc. v. Pope, 485 U.S. 478,

108 S. Ct. 1340, 99 L. Ed. 2d 565 (1988), and Lugar v.

Edmonson Oil Co., 457 U.S. 922, 102 S.Ct. 2744, 73

L. Ed. 2d 482 (1982). In each case, this Court held that

state action could occur when private actors make use of

state procedures with overt, significant assistance and

involvement of state officials. Edmondson, 500 U.S. 621-

22, 111S. Ct. at 2083-84, 114 L. Ed. 2d at 674 (peremptory

challenges in civil action); Pope, 485 U.S. at 486, 108 S. Ct.

at 1345, 99 L. Ed. 2d at 576 (nonclaim statute in probate

proceedings); Lugar, 457 U.S. at 942, 102 S. Ct. at 2756,

73 L. Ed. 2d at 498 (attachment proceedings).

Such “joint participant” facts, however, are obviously

not presented with respect to the so-called “relationship”

between Wal-Mart and the state attorney’s office in Sara-

sota. The two are not “joint participants” in anything

remotely resembling the restaurant at issue in Burton.

They are also not acting jointly in pursuance of a state

procedure such as those at issue in Edmondson, Pope, and

Lugar.

9

In the final analysis, the cases the Haughtons cite in

their petition have virtually no relevance to the facts

presented here.’ They have cited no authority that would

support a conclusion that Wal-Mart was engaging in state

action when its employee wrote Ms. Haughton’s race on

her check. In fact, a conclusion to the contrary is man-

dated by the existing case law.

The treatment of this issue by the court of appeals

was therefore correct. It shows neither a misapplication of

the law nor the application of a rationale that is in conflict

with either decisions of this Court or decisions of other

courts of appeals:

In order to prevail in an action brought under 42

U.S.C. § 1983, the plaintiffs must show that Wal-

Mart acted under color of state law, and that it

acted with discriminatory intent. The appellants

argue that state action is present because Wal-

Mart instituted its policy at the direction of the

state attorneys office. Whether an entity is a

state actor for the purposes of § 1983 is a mixed

question of law and fact that we review de novo.

Duke v. Smith, 13 F.3d 383, 392 (11th Cir. 1994).

There are three primary tests for state action:

the public function test, the state compulsion

* The Haughtons misuse the term “conflict” in their argument.

Petition for Writ of Certiorari at 7-15. The decision of the court of

appeals is not in conflict with that of any other court. The Haughtons’

actual argument is that the court of appeals did not agree that the

cases they cited were applicable to the facts of this case. Certiorari is

generally inappropriate in such instances. See S. Ct. R. 10 (“A petition

for a writ of certiorari is rarely granted when the asserted error consists

of ... the misapplication of a properly stated rule of law”).

10

test, and the nexus/joint action test. NBC v.

Communications Workers of Am., AFL-CIO, 860

F.2d 1022, 1026 (11th Cir. 1988). The public func-

tion test would be met if Wal-Mart performed ac-

tions that were “traditionally the exclusive

prerogative of the state.” Jd. The joint action or

nexus test would be met if Wal-Mart and the

state were so involved that they could be said to

have a symbiotic relationship. See, e.g., Murray

v. Wal-Mart, Inc., 874 F.2d 555 (8th Cir. 1989)

(finding police practice of detaining shoplifters

without independent investigation to constitute

“joint action”). And lastly, the state compulsion

test would be met if the attorney general com-

pelled, coerced, or significantly encouraged the

action which was alleged to violate the Constitu-

tion. Id.

After reviewing the record on appeal, it is clear

that none of the three state action tests is met.

Wal-Mart did not perform the state attorney's job

in prosecuting check fraud, and the two entities

were not “intertwined” in a symbiotic relation-

ship. Finally, although the state attorney’s office

advised Wal-Mart of the information that it

would like to have to prosecute check fraud, it

did not compel or provide encouragement signifi-

cant enough for Wal-Mart to have become a state

actor under the state compulsion test.

Because summary judgment was _ properly

granted on this issue alone, we need not reach

the question of discriminatory intent.

Petition for Writ of Certiorari at 27-28.

The reasoning of the court of appeals is unassailable,

and it presents no basis for further review by this Court.

The record established the absence of any disputed issue

11

of material fact on the question of whether Wal-Mart was

acting under color of state law. Once it was established

that the action of Wal-Mart was not state action, “the

inquiry ends.” Rendell-Baker, 457 U.S. at 838, 102 S. Ct.

at 2770, 73 L. Ed. 2d at 426. The district court accordingly

properly granted summary judgment in Wal-Mart’s favor,

and the court of appeals correctly affirmed that conclusion.

Both courts applied well-settled principles of law to

clearly-established facts. No further appellate review is

warranted, and this Court should therefore deny the

Haughtons’ petition.

, %

-_

CONCLUSION

For the foregoing reasons, Wal-Mart respectfully

requests that the Court deny the Haughtons’ petition for a

writ of certiorari.

Respectfully submitted,

RICHARD A. DUROSE

Counsel of Record

JOHN R. HAMILTON

FOLEY & LARDNER

111 N. Orange Avenue

Suite 1800

Orlando, FL 32801

(407) 423-7656

Attorneys for Respondent