Number range CHAPTER IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF SOUTH DAKOTA

WESTERN DIVISION

UNITED STATES OF AMERICA, )

)

Plaintiff, ) Civil Action No. 96-5012

v\. )

)

DAYS INNS OF AMERICA, INC., )

HFS INCORPORATED, RICHARD HAUK, )

KARLA HAUK, DAVID BAUMANN d/b/a )

CAD DRAFTING PLUS, and DOUBLE H )

ENTERPRISES, INC., )

)

Defendants. )

)

**UNITED STATES\' MEMORANDUM IN OPPOSITION TO**

**DEFENDANTS DAYS INNS OF AMERICA, INC. AND HFS INCORPORATED\'S**

**MOTION FOR SUMMARY JUDGMENT**

**(ORAL ARGUMENT REQUESTED)**

**I. INTRODUCTION**

Despite undisputed evidence that they have participated in and exercised
extensive control over the design and construction of several new Days
Inn hotels that are inaccessible to individuals with disabilities, Days
Inns of America, Inc. ("DIA") and HFS Incorporated ("HFS") contend that
they bear no responsibility for those hotels under title III of the
Americans with Disabilities Act of 1990, 42 U.S.C. §§ 12181 through
12189 ("ADA"). Rather, they argue that responsibility for compliance
with the ADA at Days Inn hotels rests only with Days Inn licensees like
Richard and Karla Hauk. According to DIA and HFS, Congress\' directive
to end discrimination against individuals with disabilities does not
apply to them: it is only the Hauks and others like them, DIA and HFS
maintain, who must comply with the ADA, and take steps to ensure that
new Days Inn hotels are accessible to all guests.

DIA's[^1] argument rests on a fundamental misreading of the ADA and its
legislative history. Despite DIA\'s protestations to the contrary, the
ADA and its legislative history do not limit compliance with new
construction requirements to those who own, operate or lease a new
facility. To the contrary, Congress has made it illegal for
[any]{.underline} individual or entity to design and construct an
inaccessible facility, whatever their relationship to the facility after
its completion. In any event, even if DIA\'s reading of the ADA were
correct, the United States has introduced abundant, undisputed evidence
showing the ways in which DIA controls and directs the functioning of
the hotels in its chain, such that DIA may fairly be held to "operate"
those hotels within the meaning of title III.

In addition to its misreading of the statute, DIA advances a variety of
other theories which, DIA insists, relieve it from any responsibility
for ADA violations at new Days Inn hotels. For instance, DIA maintains
that it has not ADA responsibility because it has assigned that
responsibility to its licensees, under the terms of its license
agreements. Even if those provisions of DIA\'s license agreements are
valid, however, it is well established that the duty to comply with a
federal civil rights law is not delegable. While such an assignment may
give DIA an action against its licensees (whether for indemnification,
contribution, or otherwise), it is no defense to an action under the
ADA.

DIA also seeks to avoid liability by invoking state common law
principles of agency. The government, however, has not advanced any
claim based on an agency theory, or any other theory of vicarious
liability. To the contrary, the United States has consistently
maintained that, due to its extensive participation in and control over
the design and construction of all new Days Inn hotels, including the
Wall Days Inn, DIA has its own, independent responsibility to comply
with the ADA\'s non-discrimination requirements. As the Wall Days Inn
and numerous other new Days Inns demonstrate, DIA has consistently
failed to meet that responsibility. Thus, the United States maintains
that DIA is liable for its own violation of the ADA, not for some other
person or entity\'s failure to comply with the statute.

**II. COUNTERSTATEMENT OF THE CASE**

DIA\'s statement of the case may be most remarkable for what it does not
say. DIA offers no evidence to suggest that the Wall Days Inn or any
other new Days Inn hotel is accessible to individuals with disabilities.
DIA offers no evidence to contradict the United States\' findings that
fourteen newly constructed Days Inn hotels, in eleven states (including
the Days Inn hotel in Wall, South Dakota), fail to comply with the
ADA\'s Standards for Accessible Design, 28 C.F.R. Part 36, Appendix A
("the Standards"), in numerous respects. DIA offers no evidence to deny
that these violations of the Standards --- which the United States found
at every new Days Inn hotel it inspected --- make it difficult or
impossible for individuals with disabilities to gain access to the
hotels and to use various features or elements of the hotel, subject
individuals with disabilities to unequal treatment, and in many cases
present significant safety hazards for individuals with disabilities.
*See* United States\' Memorandum in Support of its Motion for Summary
Judgment ("U.S. Memorandum") at 2-6.

DIA\'s statement of the case also does not dispute the ways in which DIA
participated in the design and construction of the Wall Days Inn, or the
ways in which it participates in the design and construction of all new
Days Inn hotels. *See* U.S. Memorandum at 7-12. DIA notes only that
David Baumann designed the facility, that Double H Enterprises
constructed it, and that both Baumann and Double H were hired by the
Hauks. Memorandum of Days Inns of America, Inc. and HFS Incorporated in
Support of Motion for Summary Judgment ("DIA\'s Memorandum") at 2. What
is omitted is that it was DIA, acting through its salesman, Andy
Anderson, who originally proposed to the Hauks that they build a new
hotel, and who recommended Baumann and Double H to the Hauks. *See* U.S.
Memorandum at 7-8. Baumann and Double H had worked on other Days Inn
hotels previously, and had on-going relationships with Anderson.
[Id]{.underline}. at 8. DIA prepared a conceptual site plan for the
hotel, which Mr. Hauk used to determine that the project was financially
feasible, and prepared a projection of revenues and expenses for the
hotel, which was provided to the bank to help secure financing for the
project. [Id]{.underline}. at 8-9. In designing and constructing the
hotel, Baumann and the engineer who designed the hotel\'s electrical and
mechanical systems both referred to the Days Inn Planning and Design
Standards Manual. [Id]{.underline}. at 9. DIA reviewed preliminary
architectural plans for the hotel, though it did not review those plans
for compliance with the PDSM\'s barrier-free requirements.
[Id]{.underline}. at 9, 35. DIA monitored the progress of construction,
and inspected the hotel upon its completion and several times since.
[Id]{.underline}. at 10. DIA offers no evidence to contradict any of
these facts.[^2]

Similarly, in discussing who "operates" the Wall Days Inn, DIA omits
more facts than it includes. In conclusory fashion, DIA posits that Mr.
Hauk makes significant decisions with respect to certain aspects of
running the hotel. DIA\'s Memorandum at 2-3. DIA\'s Statement of
Undisputed Material Facts ("DIA Facts"), while still largely conclusory,
identifies several additional categories of functions that are included
in the operation of a Days Inn hotel.[^3] What DIA omits is that it
exercises considerable control over virtually all of these areas, and
other besides. *See* U.S. Memorandum at 25-34. For instance, DIA has
complete control over marketing for hotels in the Days Inn chain, and
under many of its many mandatory marketing

programs, DIA sets room rates, or discounts for room rates. U.S. Facts
¶¶ 109-10. DIA determines what supplies and equipment must be provided
at the hotel, and requires licensees to purchases some supplies from
vendors approved by DIA. U.S. Facts ¶¶ 91.b, c, d, m; Wall License
Agreement, Ex. 3, ¶ 15. DIA\'s Operating Policies Manual sets standards
for maintenance, keeping the premises in order, cleanliness of rooms,
and employee duties and uniforms. U.S. Facts ¶¶ 91.a, e, f, g, k, l, m.
The Quality Assurance program scores hotels on their compliance with
these requirements, and the results are published in the Sunburst rating
system. U.S. Facts ¶¶ 92, 95-97, 103-04. The Hauks have modified their
operating practices to comply with Days Inn requirements, and avoid QA
deductions. U.S. Facts ¶¶ 101-02. DIA requires hotel managers and
employees to attend DIA training programs. U.S. Facts ¶ 111. And the DIA
license agreement specifies the form in which licensees must keep their
books and records, and the financial reports they must provide to DIA,
and allows DIA to audit their books at any time. U.S. Facts ¶ 88.d.

In addition to DIA\'s control over these aspects of hotel operations,
the Days Inn "hotel operating system" and Days Inn system standards
include various other areas of hotel operations. The Days Inn OPM ---
the licensees\' "Bible" --- sets requirements for the grooming and
attire for hotel employees, hours of operation for the front desk,
services that must be provided to guests (and the fees that may or may
not be charged for them), guest safety and security, and the forms of
payment the hotel must accept. U.S. Memorandum at 26-27. Through its
license agreements, DIA also controls when and whether licensees may
modify or renovate their hotels (including the authority to compel the
Hauks to undertake renovations costing up to \$320,000), and requires
the Hauks and other licensees to participate in DIA\'s national
reservations system, mandatory marketing programs, and various training
programs. [Id]{.underline}. at 30-33. DIA also controls how its
licensees respond to guest complaints. [Id]{.underline}. at 33-34.

In sum, as Mr. Hauk put it, "\[y\]ou don\'t have any choice" --- in
order to stay in the Days Inn system, he is required to comply with the
Days Inn operating requirements. R. Hauk Dep., Ex. 26, at 418. He
identified numerous areas of daily hotel operations which are governed
by Days Inn requirements, and testified that because of those
requirements, he runs the Wall Days Inn differently than he does his
other hotels. [Id]{.underline}. at 167-68, 402-21.

**III. ARGUMENT**

**A. Section 303 of the ADA Broadly Prohibits the Design and
Construction of Public Accommodations and Commercial Facilities that are
not Accessible to Individuals with Disabilities.**

Section 303 of the ADA --- the ADA\'s mandate requiring all newly
constructed facilities to be fully accessible --- applies to any party
that controls or participates in the design and construction of a new
public accommodation or commercial facility. *See* U.S. Memorandum at
12-25. Put differently, section 303 of the ADA defines a prohibited
activity --- discriminating against individuals with disabilities by
designing and constructing inaccessible facilities --- and makes it
illegal for anyone to engage in that activity. DIA\'s argument that it
is only illegal for some parties to engage in this activity fails to
comport with the language, structure, purpose, and legislative history
of title III and section 303 in particular.[^4]

1\. [DIA\'s argument is inconsistent with the language, structure, and
purpose of title III of the ADA.]{.underline}

As the United States argued in its memorandum in support of its motion
for summary judgment, section 303 of the ADA is not limited to parties
who own, lease, or operate public accommodations. *See* U.S. Memorandum
at 16-23. In suggesting that section 303 is so limited, DIA fails to
explain how its reading of the statute can be reconciled with the
structure of title III, the language of section 303 itself, or with
Congress\' aim to ensure that all new facilities would be designed and
constructed to be accessible.

The most serious flaw in DIA\'s argument is that DIA fails to recognize,
much less address, the disparity in the scope of sections 302 and 303.
While section 303 applies to both commercial facilities and public
accommodations, section 302 applies only to public accommodations, and
to private entities that own, lease, or operate public accommodations.
*See* U.S. Memorandum at 17-20. Accordingly, limiting section 303 to the
parties identified in section 302 would effectively eliminate coverage
of all commercial facilities except those that happened to be owned,
leased, or operated by a public accommodation. Throughout its argument,
DIA attempts to avoid this problem by referring only to "owners,
operators, lessors, and lessees," thus attempting to sever this portion
of section 302\'s language from the words that follow --- the words that
limit section 302 to places of public accommodation. *See* DIA\'s

Memorandum at 9, 10, 12-13 n. 10. Thus, DIA implies, but never
explicitly says, that the "owns, leases (or leases to), or operates"
language of section 302 should not only be carried over to section 303,
but that in doing so, it should also be revised and expanded, to apply
to both public accommodations [and]{.underline} commercial
facilities.[^5] Given that DIA repeatedly claims to be relying on the
"plain language" of the statute --- *see* DIA\'s Memorandum at 8, 11, 12
--- it is not surprising that DIA attempts to avoid this problem, rather
than addressing it explicitly.

The closest DIA comes to addressing the discrepancy between section 302
and section 303 is in a footnote discussing [Johanson v. Huizenga
Holdings, Inc.]{.underline}, 963 F. Supp. 1175 (S.D. Fla. 1997). *See*
DIA\'s Memorandum at 12-13 n.10. There DIA notes the "important
distinction" between coverage of types of facilities and coverage of
entities responsible for compliance. While this is certainly an
important distinction, what DIA does not acknowledge is that section
302\'s coverage of [entities]{.underline} is defined, at least in part,
by [types of facilities]{.underline} --- namely, entities that own,
lease (or lease to), or operate [a place of public
accommodation]{.underline}. Thus, while there is a distinction to be
made between covered facilities and covered entities, the point (which
DIA misses) is that coverage under section 302 is defined in terms of
[both]{.underline} entities [and]{.underline} facilities, which is why
that definition cannot be transferred to section 303, because section
303\'s coverage includes facilities not covered by section 302.

In addition to attempting to distinguish [Johanson]{.underline}, DIA
relies in various ways on [Paralyzed Veterans of America v. Ellerbe
Becket Architects & Engineers, P.C.]{.underline}, 945 F. Supp. 1 (D.D.C.
1996). First, DIA looks to [PVA]{.underline} for support for DIA\'s
basic premise that section 303 applies only to those parties who own,
lease, or operate the facility in question. DIA\'s Memorandum at 12. The
[PVA]{.underline} opinion, however, like DIA, fails to explain how
section 303\'s coverage of commercial facilities can be reconciled with
section 302\'s coverage of parties who own, lease, or operate public
accommodations. *See* U.S. Memorandum at 24-25. Indeed, it was precisely
this problem that caused the [Johanson]{.underline} court to come to the
contrary conclusion. 963 F. Supp. at 1178.

Second, DIA relies on [PVA]{.underline} (and other cases) for the
proposition that the Department of Justice\'s interpretation of section
303 is entitled to no deference. *See* DIA\'s Memorandum at 11-12. As
with other parts of its argument, however, DIA is responding to an
argument the government has not made. The United States does not contend
that the statute is ambiguous; our case does not rest on a claim of
deference. To the contrary, the United States\' position is that there
is only one reading of the statute that is consistent with the language
of both section 302 and 303, and with the structure, purpose, and
legislative history of the Act.[^6] Of course, were the Court
nonetheless to conclude that the statute is ambiguous, then the
interpretation of the statute by the agency entrusted with its
enforcement is entitled to substantial deference. *See, e.g.,* [Chevron,
U.S.A., Inc. v. Natural Resources Defense Council, Inc.]{.underline},
467 U.S. 837, 843 (1984) (where Congress has not directly addressed the
precise question at issue, \"considerable weight should be accorded to
an executive department\'s construction of a statutory scheme it is
entrusted to administer\").[^7]

Third, DIA relies on the [PVA]{.underline} in support of an argument
that because section 303 makes it illegal to "design and construct" an
inaccessible facility, an entity can be held liable only if it both
designs an inaccessible facility, and constructs it inaccessibly. DIA\'s
Memorandum at 12, n.9. DIA posits that the United States does not claim
that it participated in the construction of the facility, and contends
that this provides an additional basis for summary judgment. There are
two problems with DIA\'s argument. First, as a matter of fact, the
government does claim, and the undisputed facts show, that DIA both
monitored the progress of the construction of the Wall Days Inn, and
that it inspected the Wall Days Inn upon the completion of construction.
*See* U.S. Facts ¶¶ 75, 76, 111.c.i. Second, as a matter of law, DIA\'s
reading of the "design and construct" language of section 303 creates a
large loophole. Under such a reading, so long as a facility is
[designed]{.underline} to be in compliance with the ADA, the owner and
contractor can freely depart from the designs during construction and
eliminate accessible features without violating the ADA, because the
building is not both designed [and]{.underline} constructed in
violation. Such a result would effectively nullify section 303, and the
[PVA]{.underline} court simply does not address the issue. *See* 945 F.
Supp. at 2.[^8]

By including the term "design" in section 303, Congress made clear that
it was concerned with more than just the end result of the process. If,
as DIA and [PVA]{.underline} suggest, the focus were really intended to
be only on those parties who are ultimately responsible for the
facility, it would have made far more sense for Congress to have omitted
the word design from the statute altogether, and simply to have made it
illegal to construct an inaccessible facility.[^9] Congress, however,
did expressly include the term \"design\" when describing the prohibited
activities --- *see* U.S. Memorandum at 20 --- and neither DIA nor the
[PVA]{.underline} decision explains how inclusion of the design function
can be squared with their reading of the statute. It is more faithful to
the language of the statute, and better serves the purposes of the Act,
to read section 303\'s use of the conjunctive \"and\" to make it
unlawful to design an inaccessible facility as well as to construct an
inaccessible facility.

Finally, DIA\'s (implicit) suggestion that the "owns, leases (or leases
to), or operates" language should be detached from "a place of public
accommodation" and applied to section 303, to cover both public
accommodations and commercial facilities, is inconsistent with the
purpose of section 303. As explained in the United States\' memorandum
in support of its motion for summary judgment, achieving the aims of
section 303 is far more certain if its prohibition applies to all
parties engaged in the activity in question (the design and construction
of new facilities). *See* U.S. Memorandum at 21-24. DIA does not explain
why Congress would go to the trouble to define an illegal activity (the
design and construction of inaccessible facilities), and yet allow a
multitude of parties to engage in that activity with impunity (parties
including not just franchisors, but also architects, engineers, and
contractors). Congress has not taken such an approach in other civil
rights statutes, and DIA offers no reason to believe that Congress
intended the ADA to be any different. *See* U.S. Memorandum at
23-24.[^10]

2\. [The legislative history also makes clear that sections 302 and 303
of the ADA were intended to apply to different facilities, and different
parties.]{.underline}

DIA correctly points out that sections 302 and 303 were at one time part
of the same section. DIA fails to recognize, however, that the changes
made to those sections after they were separated suggest that section
302 and 303 were specifically modified in ways that caused them to apply
not just to different facilities, but also to different parties.

In early versions of the ADA legislation introduced in the Congress, the
provisions that now constitute sections 302 and 303 of the ADA were
included in what was then Title IV, Public Accommodations and Services
Operated by Private Entities. *See, e.g.,* S. 933, 101st Cong. Title IV
(May 9, 1989); H.R. 2273, 101st Cong. Title IV (May 9, 1989). Provisions
governing both existing facilities and new construction were included in
that section 402, which set forth the "general rule" that "\[n\]o
individual shall be discriminated against in the full and equal
enjoyment of the goods, services, facilities, privileges, advantages,
and accommodations of any place of public accommodation, on the basis of
disability." S. 933 at § 402(a); H.R. 2273 at § 402(a). In those bills,
the term "public accommodation" was defined to include both places used
by the general public as customers, clients, or visitors, and potential
places of employment. S. 933 at § 401(2)(A); H.R. 2273 at § 401(2)(A).
Neither the House nor the Senate bill contained any language regarding
the owners, operators, lessors, or lessees of the covered facilities.

Later in 1989, title IV was renumbered as title III (though it was still
titled Public Accommodations and Services Operated by Private Entities),
and the requirements for new construction and existing facilities were
separated into two sections: the obligations for existing facilities
were left in what had been section 402 of the legislation (now
renumbered to be section 302), and the requirements for new construction
were moved to new section 303. *See* S. Rep. 116, 101st Cong., 1st Sess.
58-60, 68-69 (1989). At the same time, "potential places of employment"
were eliminated from the definition of "public accommodation," so that
the term (and new section 302) applied only to twelve categories of
"privately operated entities." [Id]{.underline}. at 58-59. New section
303 was made applicable to both public accommodations (as redefined) and
potential places of employment. [Id]{.underline}. at 68-69.

It was not until 1990, shortly before the ADA was finally adopted, that
the language in section 302 concerning "privately operated entities" was
replaced with the final language regarding entities who "own, lease (or
lease to), or operate" public accommodations. *See* H.R. Rep. 485, Part
3, 101st Cong. 2d Sess. 11 (1990). Significantly, this new language was
added [only]{.underline} to section 302, and [not]{.underline} to
section 303. Indeed, it is quite clear that that language was not
intended in any way to define the scope of section 303; to the contrary,
the change in the language of section 302 was specifically intended to
clarify the coverage of section 302 itself, to make clear that the
parties covered by that section were not only those who operated public
accommodations, but also those who owned and leased them. As the House
Committee on the Judiciary explained:

> The Committee adopted an amendment which clarifies that the
> prohibition against discrimination "in the full and equal enjoyment of
> the goods, services, facilities, privileges, advantages, and
> accommodations of any place of public accommodation," applies to "any
> person who owns, leases (or leases to), or operates a place of public
> accommodation."
>
> This amendment makes it clear that the owner of the building which
> houses the public accommodation, as well as the owner or operator of
> the public accommodation itself, has obligations under this Act. For
> example, if an office building contains a doctor's office, both the
> owner of the building and the doctor's office are required to make
> readily achievable alterations. It simply makes no practical sense to
> require the individual public accommodation, a doctor's office for
> example, to make readily achievable changes to the public
> accommodation without requiring the owner to make readily achievable
> changes to the primary entrance to the building.

[Id]{.underline}. at 55-56.

At the same time that the "owns, leases (or leases to), or operates,"
language was added to section 302, section 303 was also amended. Its
coverage, which previously had included public accommodations and
"potential places of employment," was redefined to include public
accommodations and "commercial facilities." Unlike section 302, however,
no language was added to section 303 to indicate that those who own,
operate or lease the facilities in question were the only parties with
responsibilities under section 303. Certainly, if Congress had wished to
restrict section 303's coverage in that manner, it could have done so at
the same time that it "clarified" the coverage of section 302. In sum,
there can be little question that Congress deliberately chose to draft
sections 302 and 303 differently, and intended them to apply to
different kinds of activities, different categories of facilities, and
different parties.

3\. [DIA\'s construction of section 303 --- not the government\'s ---
leads to absurd results.]{.underline}

Despite DIA\'s insistence to the contrary, the United States\' reading
of section 303 of the ADA leads to perfectly reasonable results --- it
imposes liability on all parties who engage in an activity declared
illegal by the Congress: the design and construction of inaccessible
facilities. As discussed in the United States\' memorandum in support of
its motion for summary judgment, such an approach is entirely consistent
with the results obtained under other civil rights statutes. *See* U.S.
Memorandum at 23-24.

Indeed, although DIA asserts that is is "absurd" to hold a contractor or
subcontractor liable for constructing an inaccessible facility, DIA does
not explain why it considers such a result to be absurd. *See* DIA\'s
Memorandum at 18-19. To the contrary, it is entirely logical for the
parties who design and construct the building --- the parties who are in
the best position to ensure ADA compliance --- to bear the
responsibility for that compliance. Interestingly, while DIA suggests
that it would be absurd to hold contractors liable under section 303,
DIA does not suggest that it would be absurd to hold architects liable.
Presumably, DIA agrees with the government that it makes sense to hold
architects liable for designing inaccessible facilities.[^11]

In an another attempt to distort the government\'s position, DIA
consistently ignores the limits inherent in the United States\' claim
under section 303, suggesting that the government would impose liability
of "virtually unlimited scope." DIA\'s Memorandum at 19. DIA is simply
wrong. The United States\' theory of liability is limited in at least
two ways. First, a party must in some way be involved in the design and
construction of the facility. Thus, several of the examples of
"absurdities" offered by DIA will never arise. *See* DIA\'s Memorandum
at 18-19. For instance, the bank that makes a construction loan does
not, without more, "design" the facility in any way, or "construct" the
facility in any way, and thus has no responsibility under section 303.
Similarly, the workers who deliver bricks and lumber to the construction
site do not, without more, "design" the facility in any sense, or
"construct" it, and they too are outside the reach of section 303.
Second, although DIA refuses to acknowledge it, the United States has
consistently maintained that the liability of any party involved in the
design and construction of the facility is limited to the scope of that
party\'s involvement in the design and construction. *See* U.S.
Memorandum at 14-15.[^12] The government simply does not seek, as DIA
intimates, to hold a plumber responsible for failures to comply with the
ADA throughout the facility, or to impose disproportionate liability on
any party or individual.

Equally baseless is DIA\'s claim that the United States sets an
impossible standard, by imposing liability on parties with no legal
ability to insure ADA compliance. Under the government\'s view of the
statute, no party has a responsibility that exceeds its authority.
Rather, the responsibility borne by any party for compliance with
section 303 of the statute is coextensive with that party\'s involvement
in or control over the design and construction of the facility at issue.
Thus, a building contractor is not made the guarantor of ADA compliance:
if some feature or element of the project fails to comply with the
Standards, the contractor might seek to have the owner make the
necessary changes, but if the owner refuses, the contractor\'s
responsibility is to refuse to do the work (or, put differently, to
refuse to construct an inaccessible facility, or refuse to participate
in the construction of an inaccessible facility). If the owner gets some
other contractor to complete the facility in a way that does not comply
with the Standards, the contractor that refused to do so has no
liability (because that contractor did not construct, or participate in
the construction of, an inaccessible facility). Similarly, if an
architect is instructed by an owner to design a facility that does not
comply with the Standards in some respect, and the architect cannot
persuade the owner to do otherwise, the architect\'s responsibility is
to refuse to do the work --- to refuse to design an inaccesible
facility. If the owner finds some other architect who will do the work,
the first architect has no responsibility, because he or she did not
design, or participate in the designing of, an inaccessible facility.
What the architect and contractor may [not]{.underline} do is to decide
that whether the facility will comply with the ADA is entirely up to the
owner, and go along with the owner\'s desire to design and construct a
facility that will exclude or discriminate against individuals with
disabilities. That is, an owner\'s instruction to do something that
violates the ADA cannot remove the architect or contractor from the ADA
provision making it illegal to design and construct inaccessible
facilities.[^13]

The same rules apply to DIA. Like an architect or contractor, DIA may
not ultimately be able to compel an owner to comply with the ADA --- the
owner could decide to breach or terminate its agreement with DIA[^14]
--- such that DIA is not the guarantor of ADA compliance by the
licensee. That limitation, however, does not mean that DIA has no
obligation under the ADA. In its license agreements, DIA reserves to
itself considerable authority over the design and construction of new
Days Inn hotels. *See* U.S. Memorandum at 7, 10-11. Having done so, DIA
cannot also avoid all responsibility for ADA compliance.[^15] That is,
DIA cannot simply encourage its licensees to comply and be done with it;
it must, to the extent of its authority over the project, exercise that
authority to ensure that the new hotel will be accessible to individuals
with disabilities. Thus, when it issues design standards, those
standards must comply with the requirements of the ADA\'s Standards for
Accessible Design. When it reviews plans, it must review them for
compliance with the ADA, and if the plans do not comply with the ADA, it
must require licensees to bring them into compliance, or withhold its
approval of those plans. When it inspects completed hotels, it must
inspect them for compliance with the ADA, and if an inspection reveals a
failure to comply with the Standards, DIA must require the licensee to
correct the non-complying condition, or refuse the licensee admission to
the Days Inn system. Just as with architects and contractors, none of
this makes DIA the guarantor of ADA compliance by its licensees: if a
licensee insists on violating the ADA, despite DIA\'s efforts to achieve
compliance, DIA satisfies its obligations under the ADA by refusing to
participate (or refusing to continue to participate) in the design and
construction of an inaccessible hotel. DIA is thus the guarantor only of
its own conduct, which unquestionably is an obligation DIA has the
authority to meet.

Indeed, it is DIA\'s proposed reading of the statute, not the
government\'s, that produces absurdities. For instance, DIA posits that
owners, operators, lessors and lessees are the parties "in the best
position to assure compliance." DIA\'s Memorandum at 19. DIA, however,
does not explain how it comes to this conclusion, and the answer is not
apparent. While an owner certainly may be in a position of ultimate
control over the design and construction process, that is hardly the
same thing as being in a position to ensure that the facility complies
with the ADA\'s architectural requirements. While owners may well be
generally aware of the ADA, they typically will not be familiar with
specific ADA requirements (or other requirements imposed by zoning
ordinances, building codes, environmental laws, and the like), and will
simply be unable to ascertain in many cases whether some feature or
element of the facility meets the ADA. This, of course, is precisely why
an owner hires an architect, engineer, or other design professional, and
a construction contractor or other building professional, and why it
makes sense to hold those entities responsible for ADA compliance along
with the owner.

The absurdities inherent in DIA\'s position are even more pronounced
with respect to the entities who operate or lease a facility ---
entities which DIA claims are "in the best position" to assure ADA
compliance. Frequently, the entities who will operate or lease a new
facility are not even identified at the time the facility is being
designed and constructed, and it is absurd to suggest that those
entities are in any position, let alone the "best" position, to assure
ADA compliance. Indeed, although it does not acknowledge it, DIA creates
a "Catch 22" problem: with respect to the United States\' evidence that
DIA operates the Wall Days Inn, DIA responds that all of that evidence
relates to the period of time [after]{.underline} the facility was
designed and constructed, and is thus insufficient to establish DIA\'s
liability. DIA\'s Memorandum at 27 ("the \'controls\' identified by DOJ
all occurred after the design and construction of the Wall Facility").
DIA does not say, however, what evidence would be acceptable to
establish that it operates the Wall Days Inn, or how one would ever be
able to identify who "operates" a hotel that has not yet been built.
*See* U.S. Memorandum at 20 n.17. In sum, DIA\'s position is really that
just the owners of new facilities should have any responsibility under
section 303 --- an approach Congress rejected even under section 302.

**B. DIA\'s Duty to Comply With the ADA\'s New Construction Requirements
is Not Delegable.**

One of DIA\'s primary defenses to the United States\' claim is that ADA
compliance at Days Inn hotels is somebody else\'s problem. According to
DIA, its license agreements have assigned the responsbility for ADA
compliance to its licensees, and thus relieve DIA of any responsibility
for compliance. DIA\'s Memorandum at 4-5, 22-24. It is well settled,
however, that the duties of non-discrimination imposed by federal civil
rights statutes are not delegable.[^16]

Once DIA undertook to participate in, and exercise control over, the
design and construction of new Days Inn hotels, it also undertook the
responsibility to ensure, to the extent of its control and
participation, that new Days Inn hotels comply with the ADA. Having
involved itself extensively in the design and construction of these
hotels, DIA, like any other private party, cannot escape a
responsibility imposed by a federal statute by contracting it away. The
cases make clear that the duties imposed under federal
non-discrimination statutes --- including the Fair Housing Act, on which
section 303 is modelled --- are not delegable. To the extent that DIA
has attempted to rely on its licensees to ensure that new hotels in its
chain comply with the ADA, it has done so at its own peril. If its
licensees have failed to make the hotels comply, both they and DIA are
responsible.

Several federal courts have held that the duties not to discriminate
imposed by federal civil rights statutes, and particularly the Fair
Housing Act, are not delegable. *See* [Walker v.]{.underline}

[Crigler]{.underline}, 976 F.2d 900, 904 (4th Cir. 1992) (adopting
\"general rule\" applied by other federal courts that duty not to
discriminate under Fair Housing Act is non-delegable); [Coates v.
Bechtel]{.underline}, 811 F.2d 1045, 1051 (7th Cir. 1987) (in cases
under Fair Housing Act and § 1982, courts have imputed wrongful acts of
real estate agent to property owner, even if not authorized or
ratified); [Heights Community Congress v. Hilltop Realty,
Inc.]{.underline}, 774 F.2d 135, 141 (6th Cir. 1985) (holding that
realtor could not escape liability for acts of real estate agents by
proving that the agents "were independent contractors, over whom under
common law it has no control" or proving that the realtor instructed its
agents in the law and urged them to comply with it); [Phiffer v. Proud
Parrot Motor Hotel, Inc.]{.underline}, 648 F.2d 548, 552 (9th Cir. 1980)
(duty to obey laws relating to racial discrimination is non-delegable);
[Marr v. Rife]{.underline}, 503 F.2d 735, 741 (6th Cir. 1974) (holding
the owner of an apartment building responsible for the discriminatory
conduct of a resident manager \"both under the doctrine of respondeat
superior and because the duty to obey the law is non-delegable,\"
quoting [United States v. Youritan Construction Co.]{.underline}, 370 F.
Supp. 643, 649 (N.D. Calif. 1973), *aff\'d in part and rev\'d in part on
other grounds*, 509 F.2d 626 (9th Cir. 1975)); [Saunders v. General
Svcs. Corp.]{.underline}, 659 F. Supp. 1042, 1059 (E.D. Va. 1987) (under
Fair Housing Act, duty not to discriminate is non-delegable); [Harrison
v. Otto G. Heinzeroth Mortgage Co.]{.underline}, 430 F. Supp. 893,
896-97 (N.D. Ohio 1977) (same); [United States v. L&H Land
Corp.]{.underline}, 407 F. Supp. 576, 580 (S.D. Fla. 1976) (same); [Zuch
v. Hussey]{.underline}, 394 F. Supp. 1028, 1051 (E.D. Mich. 1975)
(same); [United States v. Real Estate Devel. Corp.]{.underline}, 347 F.
Supp. 776, 785 (N.D. Miss. 1972) (same). Thus, while the provisions in
DIA\'s license agreements and other disclaimers of responsibility may
give DIA a third-party action against the owners of the hotels or
others, if those third parties fail to discharge the duties they and DIA
have allocated among themselves, those provisions allocating
responsibility among DIA and other parties are no defense to an action
under title III of the ADA.

Moreover, if it were not enough that the federal courts have
consistently refused to allow parties to escape federal statutory
requirements by assigning them to someone else, the ADA specifically
addresses the issue. One of the provisions of section 302 of the Act
specifically provides that "\[a\]n individual or entity shall not,
directly or through contractual or other arrangements, utilize standards
or criteria or methods of administration (i) that have the effect of
discriminating on the basis of disability; or (ii) that perpetuate the
discrimination of others who are subject to common administrative
control." 42 U.S.C. § 12182(b)(1)(D). The legislative history makes
clear that under title III of the ADA, "an entity may not do indirectly
through contractual arrangements what it is prohibited from doing
directly under the Act\[,\] . . . \[and\] a covered entity may not use a
contractual provision to reduce any of its obligations under this Act."
H.R. Rep. 485, Part 2, 101st Cong., 2d Sess. (1990) at 104.

**C. DIA\'s Reliance On [Neff v. American Dairy Queen]{.underline} is
Misplaced.**

Assuming for the sake of argument that DIA were correct in its reading
of sections 302 and 303, and that the coverage of section 303 was
limited to owners, operator, lessors and lessees, the United States
maintains that DIA operates the Wall Days Inn (and other Days Inn
hotels). *See* U.S. Memorandum at 25-34. Despite the considerable
evidence that DIA operates the Wall Days Inn and other hotels in the
Days Inn system, however, DIA relies on [Neff v. American Dairy Queen
Corp.]{.underline}, 58 F.3d 1063 (5th Cir. 1995), [cert.
denied]{.underline}, \_\_\_\_ U.S. \_\_\_\_, 116 S. Ct. 704 (1996), for
the proposition that it does not operate those hotels.[^17] That
reliance is misplaced. In [Neff]{.underline}, the plaintiff alleged that
two Dairy Queen restaurants, both built before passage of the ADA, and
therefore subject to the requirement in section 302(b) of the ADA to
remove architectural barriers to access, were nonetheless inaccessible
to persons who use wheelchairs. [Id]{.underline}. at 1064. The plaintiff
argued that the franchisor, American Dairy Queen (\"ADQ\"), \"operated\"
the restaurants, and should therefore be held liable for the
restaurants\' failures to remove the barriers to access.
[Id]{.underline}. at 1065. The Fifth Circuit held, on the basis of its
conclusion that ADQ had minimal control over the removal of structural
barriers, that ADQ did not operate a place of public accommodation
within the meaning of the Act. [Id]{.underline}. at 1066, 1068-69. In
reaching this conclusion, the Fifth Circuit too narrowly construed what
it means to operate a place of public accommodation, and adopted a
reading of the statute that cannot be reconciled with the statutory
lanaguage and leads to absurd results. Moreover, several factors
distinguish this case from the situation presented in
[Neff]{.underline}.

1\. [*Neff* is wrongly decided]{.underline}.

There is a major flaw in the [Neff]{.underline} Court\'s reasoning: in
deciding what the term \"operate\" means under title III, the Court
focussed solely on the question of who has control over the ability to
remove architectural barriers, rather than the more general question of
who has power or control over all of the operations of the
facility.[^18] In doing so, [Neff]{.underline} produces a rule that
cannot be reconciled with the other provisions of section 302(b), and
that leads to absurd results.

The court began, properly enough, with the well-established canon of
statutory construction that where Congress does not define the term at
issue, courts \"construe it in accord with its ordinary and natural
meaning.\" [Neff]{.underline}, 58 F.3d at 1066 (citations omitted). The
court appropriately considered such definitions of \"operates\" as
\"\[t\]o control or direct the functioning of.\" [Id]{.underline}. at
1065. From these definitions, however, the court proceeded to an
inappropriately narrow test, looking only to whether the entity had
control over the prohibited activity (the removal of architectural
barriers), not to whether the entity had control over, or directed the
functioning of, the place of public accommodation (which is what the
language of section 302(a) requires).

> Neff and the United States as *amicus curiae* point to numerous
> non-structural aspects of the San Antonio Stores\' operations that
> they contend ADQ controls, such as accounting, personnel uniforms, use
> of trademarks, etc. While ADQ\'s control over these aspects may be
> relevant in other contexts, we hold that because it does not relate to
> the allegedly discriminatory conditions at the San Antonio Stores, it
> does not bear on the question of whether ADQ \"operates\" the
> franchises for the purposes of the ADA\'s prohibition on
> discrimination in public accommodations.

[Id]{.underline}. at 1066. Having deemed all other evidence of the
franchisor\'s control over the operation of the restaurant irrelevant,
the [Neff]{.underline} court looked only to one provision in the
franchise agreement at issue: a provision which gave American Dairy
Queen the right to disapprove or veto structural changes to the
facility. The court found this provision to be \"essentially negative in
character,\" and thus insufficient to support a claim that ADQ operated
the restaurant. [Id]{.underline}. at 1068.

[Neff]{.underline}\'s narrow inquiry --- looking only to see who had
authority to make physical changes to the facility --- makes no sense,
and is not consistent with the language of the statute. Section 302(a)
of the ADA prohibits discrimination by any entity that \"owns, leases
(or leases to), or operates a place of public accommodation.\" 42 U.S.C.
§§ 12182(a). Section 302(b) of the Act then defines several particular
types of activity considered to be discrimination. Under the
[Neff]{.underline} approach, the entities who would be covered under
section 302(b) would vary from prohibition to prohibition, because,
under the [Neff]{.underline} approach, the question would not be whether
an entity operates the public accommodation in a general sense (as is
implied by section 302(a)), but rather whether the entity has control
over the activity in question in the particular sub-paragraph of section
302(b) (things such as imposing eligibility criteria, modifying policies
and practices, or providing auxiliary aids and services). *See* 42
U.S.C. §§ 12182(b)(2)(A)(i), (ii), (iii). [Neff]{.underline} thus
suggests that rather than making a single determination of who is
covered under section 302(a), coveraged must be determined separately
for each of section 302(b)\'s particular prohibitions. Nothing in the
language of statute supports such an odd conclusion.[^19]

Other courts confronted with this question have understood that section
302 requires an inquiry not into whether the party in question has
authority over the particularly activity in question, but rather whether
that party can direct or control the operation of the facility itself.
*See, e.g.,* [Aikins v. St. Helena Hosp.]{.underline}, 843 F. Supp.
1329, 1335 (N.D. Cal. 1994) (\"\[t\]he use of language relating to
ownership or operation implies a requirement of control over the [place
providing services]{.underline}.\") (emphasis added)). Indeed, the cases
by the [Neff]{.underline} court support not [Neff]{.underline}\'s
conclusion that the key inquiry is into whether an entity has control
over the particular activity covered by the Act, but rather whether the
entity meets a more general definition. For instance, in [Carparts
Distribution Center Inc. v. Automotive Wholesalers Ass\'n of New
England]{.underline}, 37 F.3d 12 (1st Cir. 1994), the First Circuit
considered whether a self-funded medical reimbursement plan was covered
as an \"employer\" under title I of the ADA. The court did not look just
to the plan\'s control over the alleged discriminatory act, as
[Neff]{.underline} implies. To the contrary, the court in
[Carparts]{.underline} underscored its obligation to construe the ADA
broadly, and offered several possible theories under which the plan ---
which in no way \"employed\" the plaintiff in the traditional sense ---
could be found [covered]{.underline} by the Act. [Id]{.underline}. at
16-18. Similarly, in [Howe v. Hull]{.underline}, 873 F. Supp. 72 (N.D.
Ohio 1994), the court noted the broad language and remedial purposes of
the ADA, and extended coverage under title III to an on-call admitting
physician, finding him individually liable for his discriminatory
actions. [Id]{.underline}. at 78. In determining whether the physician
was an \"operator of the hospital\" within the meaning of the ADA, the
court considered not only whether the physician had the power and
discretion to perform the allegedly discriminatory act, but whether he
was in a position of authority at the hospital generally.
[Id]{.underline}.[^20]

2\. [This case is distinguishable from *Neff*]{.underline}.

In any event, this case is readily distinguishable from
[Neff]{.underline}. The [Neff]{.underline} court based its holding
entirely on the language of the franchise agreement in that case; the
court did not consider any other evidence of ADQ\'s control over the
restaurants. 58 F.3d at 1065, 1067. And because the plaintiff conceded
that the franchise agreement was unambiguous, the court held that the
only question presented --- the construction of an unambiguous contract
--- was one of law.[^21] In general, however, courts have held that the
nature and extent of control exercised by a franchisor over a franchisee
is a question of fact, and the parties have certainly treated it as a
fact question in this case. *See* U.S. Facts ¶¶ 85-115; DIA Facts ¶¶
19-25. *See also* [Oberlin v. Marlin American Corp.]{.underline}, 596
F.2d 1322, 1326 (7th Cir. 1979) (legal status of relationship between
franchisor and franchisee depends of facts of relationship); [Drexel v.
Union Prescription Centers, Inc.]{.underline}, 582 F.2d 781, 785-86 (3rd
Cir. 1978) (treating question, arising under state law of agency, of
whether franchisor operated retail store as one of fact).

In this case, the degree of control that DIA exercises over its
licensees, including Richard and Karla Hauk, is evidenced not just by
the license agreement, but by a variety of other documentary evidence,
and the testimony of several witnesses. As discussed above, the
undisputed evidence shows that DIA exercises considerable control over
virtually all aspects of the operation or management of the Wall Days
Inn, including marketing, setting room rates, front desk operations,
employee training, employee relations, employee uniforms and job duties,
dealing with walk-up business, providing wake up calls and continental
breakfasts, fees charged for local telephone calls, fax services, and
use of baby cribs, purchasing supplies and equipment, maintenance,
assuring the cleanliness of rooms, maintaining books and records, and
others. *See* *supra*, at 4-6; *see also* U.S. Memorandum at 25-34;
United States\' Response to Days Inns of America, Inc. and HFS
Incorporated\'s Statement of Undisputed Material Facts ¶¶ 21-25. In
addition to these items (which are items raised by DIA in its statement
of undisputed facts), the undisputed facts further show that DIA
exercises control over a variety of other hotel functions or operations,
including the hotel\'s reservations system (U.S. Facts ¶¶ 105-08),
provision of no-smoking rooms and making courtesy calls to guests (U.S.
Facts ¶¶ 110.d, e), training for hotel managers (U.S. Facts ¶¶ 111.a,
b), and handling guest complaints (U.S. Facts ¶¶ 113-15). By means of
its Operating Policies Manual, its Quality Assurance program, and the
Sunburst rating system, DIA controls hundreds of aspects of the daily
operation of hotels in its chain. *See* U.S. Facts ¶¶ 89-104. In sum,
the evidence that DIA operates the Wall Days Inn and other Days Inn
hotels is considerably different than the evidence offered by Neff that
American Dairy Queen operated the restaurants at issue in that case.

3\. [Even if *Neff* were correctly decided, and applicable here, DIA
would be responsible under the *Neff* "test" for the failure of the Wall
Days Inn to be readily accessible to and usable by individuals with
disabilities.]{.underline}

To the extent that [Neff]{.underline} announces a coherent test for ADA
responsibility, at most that test requires a showing that DIA had
control over the discriminatory conduct or conditions at issue. 58 F.3d
at 1066-67 ("the relevant inquiry in a case such as this one is whether
ADQ specifically controls the modification of the franchises to improve
their accessibility to the disabled").[^22] Presumably, in a case
alleging violations of section 303 of the ADA, the relevant inquiry
under [Neff]{.underline} would be whether DIA specifically controlled
the design and construction of the Wall Days Inn.[^23] Put differently,
if control over the modification of an existing facility to improve
accessibility for individuals with disabilities was what was required to
make ADQ an "operator" of the facility in [Neff]{.underline}, then (odd
as this may seem) control over the accessible design and construction of
a new facility would make DIA an "operator" of the Wall Days Inn.

The undisputed facts make clear that DIA exercised extensive control
over the design and construction of the Wall Days Inn and the other
hotels in its system. DIA originally proposed that a new hotel be built
on the site of the Wall Days Inn, recommended an architect and
contractor to the owner, provided its PDSM to the architect and
contractor, provided a conceptual site plan to the owner (which he used
to decide to go forward with the project), provided the Hauks\' lender
with a projection of revenues and expenses for the new hotel, required
the Hauks to prepare plans that conformed to the Days Inn design
standards (which include accessibility requirements), reviewed those
plans and noted changes on them (including changes to improve the
accessibility of the hotel), monitored the progress of construction, and
inspected the hotel upon its completion, before admitting it to the Days
Inn system. *See* U.S. Memorandum at 7-10; U.S. Facts ¶¶ 29, 44-76, 92,
93, 100, 111.c.i. Under the terms of both the license agreement and the
PDSM, DIA required the Hauks to design and construct the hotel in
compliance with the ADA, and the license agreement gives DIA the
affirmative authority to require the Hauks to modify the hotel (both to
gain intial admittance to the Days Inn system, and to renovate the hotel
later in the life of the agreement). *See* U.S. Memorandum at 30; U.S.
Facts ¶¶ 88.l, m; Wall License Agreement, Ex. 3, ¶ 5. If the Hauks
refuse to comply with their obligations under the license agreement, DIA
can suspend the Hauks from the Days Inn reservation system, or terminate
the agreement (and require the Hauks to forfeit their investment in the
franchise). Thus, even if the [Neff]{.underline} test were to be applied
here, DIA has sufficient control over the design and construction of the
Wall Days Inn to make it an "operator" of the Wall Days Inn.

**D. DIA Exercises Considerably More Control Over its Licensees than is
Required by the Lanham Act.**

In the course of addressing the issue of whether it operates the Wall
Days Inn and other hotels in its system, DIA acknowledges that it
"admittedly has exercised some control over the Wall and other franchise
facilities," but suggests that it has done only what it is required to
do by the Lanham Act, 15 U.S.C. §§ 1051, 1061, and 1127 *et seq*., to
preserve the validity of its trade and service marks. DIA\'s Memorandum
at 28. *See also* DIA\'s Memorandum at 27 ("the controls \[exercised by
DIA\] are related to DIA\'s legitimate interests in assuring the
offering of uniform and quality services under its service mark"). There
are two problems with DIA\'s argument: first, it makes no difference
[why]{.underline} a party involves itself in the design and construction
of a new facility, or the operation of a facility --- it matters only
that they have done so. Second, DIA exercises far more control over its
licensees than is required by the Lanham Act.

> The government makes no claim that DIA\'s involvement in the design
> and construction of the Wall Days Inn, or any new Days Inn, is in any
> way improper or illegitimate. To the contrary, the United States
> freely acknowledges the legitimacy of DIA\'s interests in quality,
> uniformity, and consistency, among others. Indeed, the United States
> included in its own statement of undisputed facts several items
> relating to DIA\'s strong interests in how and when licensees design
> and construct new Days Inn hotels, and in how hotels in the Days Inn
> system are operated. *See* U.S. Facts ¶¶ 27.e.i, 27.f.i, 104.a, 111.b,
> 115. Just as the Hauks, Baumann, and Double H all had legitimate
> interests in the how and when the Wall Days Inn was designed and
> constructed, so does DIA. Similarly, DIA has legitimate interests in
> how the Wall Days Inn is operated, just as the Hauks do. That the
> interests are legitimate, however, does not mean that they somehow
> insulate the party in question from compliance with the ADA.
> Presumably, even DIA would acknowledge, for instance, that the Hauks
> have legitimate interests in the way the Wall Days Inn is operated,
> but would not contend that the Hauks therefore do not "operate" the
> hotel within the meaning of the ADA.

Second, as the cases cited by DIA make clear, the Lanham Act imposes
relatively modest requirements with respect to the protection of trade
and service marks; it certainly does not require the level of control
exercised by DIA. It is certainly true that the Lanham Act requires
licensors of trademarks to oversee the quality of their licensees\'
products, to protect the integrity of their marks, and to ensure that
licensees do not sell to an unsuspecting public goods bearing the mark
that are of inferior quality. *E.g.,* [Oberlin v. Marlin American
Corp.]{.underline}, 596 F.2d at 1327 ("licensor must control the
operations of its licensees to ensure that the trademark is not used to
deceive the public"; purpose of Act is "to ensure the integrity of
registered trademarks"); [Kentucky Fried Chicken Corp. v. Diversified
Packaging Corp.]{.underline}, 549 F.2d 368, 387 (5th Cir. 1977) ("If a
trademark owner allows licensees to depart from its quality standards,
the public will be misled, and the trademark will cease to have utility
as an informational device.").

These same cases make clear, however, that the control over licensees
required by the Lanham Act is quite limited. The [Oberlin]{.underline}
Court explained that "the scope of the duty of supervision associated
with a registered trademark is commensurate with \[the\] narrow purpose"
of the Lanham Act to avoid deception. 596 F.2d at 1327. A licensor is
not required to control the day-to-day operations of a licensee "beyond
that necessary to ensure uniform quality of the product or service."
[Id]{.underline}. Similarly, the [Kentucky Fried Chicken]{.underline}
Court explained that "\[r\]etention of a trademark requires only minimal
quality control," and the party seeking to establish that the control
has been inadequate must "carry \[a\] heavy burden." 549 F.2d at 387.
*See also* [Dawn Donut Co., Inc. v. Hart\'s Food Stores,
Inc.]{.underline}, 267 F.2d 358, 367 (2d Cir. 1959) (licensor must take
"some reasonable steps to prevent misuses of his trademark").

The System Standards imposed by DIA in its Operating Policies Manual and
its Planning and Design Standards Manual --- and as enforced by its
Quality Assurance program and Sunburst rating system --- far exceed the
quality control requirements of the Lanham Act. The OPM, for instance,
sets remarkably detailed requirements for all aspects of the daily
operations of Days Inn hotels, including specifying all furnishing,
fixtures, and supplies for guest rooms (including requirements for the
size of the television screen, the number of skirt hangers (Montrose
style number 17BTN with an O ring or equivalent), the number of
ashtrays, the number of sheets of stationery, the size, weight, color,
and fiber content of all towels and linens (maximum shrinkage allowed is
ten percent), the size of the ice bucket, the size of the soaps, and a
requirement that the shower curtain have matching plastic hooks). U.S.
Facts ¶¶ 91.b, c, d. It sets requirements for guest services, including
provision of wake-up service, a fax machine, complimentary coffee, free
local phone calls, free ice, free use of baby cribs, and a complimentary
continental breakfast consisting of fruit juices, freshly brewed coffee,
decaffeinated coffee, hot water and tea bags, breakfast pastries,
muffins, croissants, or local specialities. U.S. Facts ¶¶ 91.i, o. The
OPM also sets housekeeping and maintenance requirements --- including a
requirement that each hotel establish a schedule for cleaning the lint
traps in their dryers --- and the QA inspections evaluate dozens of
items for cleanliness and proper working condition. U.S. Facts ¶¶ 91.k,
94-96.

Similarly, the PDSM contains hundreds of detailed specifications for the
design and construction of the hotel, many of which are not essential to
ensuring the quality of services provided by Days Inn franchisees. In
addition to numerous requirements for guest rooms, the hotel lobby, and
other public areas, the PDSM includes site requirements (among other
things, requirements for paving materials, loading docks, dumpster pads,
and swimming pool filtering systems); structural requirements
(including, among other things, requirements for soil borings, the
hotel\'s structural frame, roofing materials, and for insulation in the
exterior walls); requirements for employee areas (including, among
others, requirements for the hotel laundry, linen storage area, and the
capacity of washers and dryers, for the maintenance area, and for what
equipment and materials are to be stored in various storage spaces); and
requirements for the hotel\'s electrical system (including requirements
for circuit breakers, wiring conduits, transformer locations, and for
lightning protection). U.S. Facts ¶ 33. DIA\'s expert witness
acknowledged that the PDSM contained requirements for areas of the hotel
that guests would never see, and acknowledged that the manual contained
numerous requirements which had nothing to do with defining Days Inn\'s
market position. Kiewel Dep., Ex. 20, 168-69, 176-79.[^24] In sum, there
can be little question that the requirements DIA imposes on its
licensees far exceed what is required by the Lanham Act.

**E. DIA\'s Argument Based on Agency Law is Inapplicable Here.**

Remarkably, DIA devotes considerable effort to arguing that it does not
meet the requirements for liability under principles of the law of
agency, which is a theory of liability advanced by the plaintiff in
[Neff]{.underline}, but [not]{.underline} by the United States. DIA\'s
Memorandum at 20, 26, 30-36. DIA insists, at length, that control of the
type exercised by DIA has been held insufficient to make franchisors
vicariously liable, under state law, for personal injuries suffered on
the premises of individual franchise locations. In support of this
argument, DIA cites a series of decisions from state courts, opining on
state law. *See* DIA\'s Memorandum at 30-36 (citing cases from North
Carolina, California, Georgia, Michigan, Virginia, Iowa, Maryland, and
Texas). The problem with DIA\'s argument is that it is wholly
inapplicable here. Rulings by state courts on agency law in personal
injury cases are not relevant to DIA's liability under the terms of a
federal statute. The United States contends that DIA has itself violated
that statute: DIA's liability arises from its own actions and omissions
--- actions and omissions with respect to the design and construction of
numeorus inaccessible Days Inn hotels, including the Wall Days Inn. The
United States does not contend that DIA should be held vicariously
liable --- under agency law or any other theory --- for the actions of
some other party, whether it be the Hauks, Baumann, Double H, or any
other owners, architects, or contractors. Thus, unlike [Hayman v. Ramada
Inn, Inc.]{.underline}, 357 S.E.2d 394, 397 (N.C. App. 1987), and the
other cases cited by DIA, liability here does [not]{.underline} depend
upon the existence of an agency relationship. *See* DIA\'s Memorandum at
30.

> It is not clear from DIA\'s memorandum, but it may be that DIA relies
> upon the state law agency cases for a different purpose: as a means of
> defining the term "operate." There are several problems, however, with
> such an approach to defining the statutory language of the ADA. First,
> the cases cited by DIA make clear that they rest, in large part, on
> policy choices that are embodied in the state law of agency. That is,
> they recognize that there is a legitimate interest to be served by
> allowing franchisors to exercise some control over their franchisees,
> without making the franchisees, which are otherwise independent
> contractors, into the agents of the franchisors. *See, e.g.,* [Cislaw
> v. Southland Corp.]{.underline}, 4 Cal. App. 4th 1284, 6 Cal. Rptr. 2d
> 386, 391 (Cal. Ct. App. 1992) ("The cases, taken as a whole,
> implicitly recognize that the franchisor\'s interest in the reputation
> of its entire system allows it to exercise certain controls over the
> enterprise without running the risk of transforming its independent
> contractor franchisee into an agent."). What DIA does not explain,
> however, is why this policy judgment, embedded in state law, should be
> imported into the ADA. There is no basis on which to conclude that the
> Congress wished to afford some special protection to franchisors; to
> the contrary, the Congress made clear that it intended to change the
> law, and to impose requirements not previously in place. The chief
> purpose of the ADA is to provide \"a clear and comprehensive national
> mandate for the elimination of discrimination against individuals with
> disabilities,\" 42 U.S.C. § 12101(b)(1), and to that end, Congress
> acted to "invoke the sweep of congressional authority, including the
> power to enforce the fourteenth amendment and to regulate commerce, in
> order to address the major areas of discrimination faced day-to-day by
> people with disabilities." 42 U.S.C. § 12101(b)(4). There is no
> suggestion anywhere in the Act or its legislative history that
> Congress intended to carve out a special protection for franchisors,
> exempting them from the requirements placed on
>
> all other American businesses.[^25]

Moreover, to the extent that DIA is urging the Court to employ a
specialized definition of "operates," as developed in the agency
caselaw, DIA does not explain why the Court should not simply use the
common and ordinary definition of the term. It is well settled that one
of the fundamental canons of statutory construction is that, unless
otherwise defined, words appearing in a statute are to be interpreted as
taking their ordinary, natural, or common meaning. *See, e.g.,* [Smith
v. United States]{.underline}, 508 U.S. 223, 228 (1993); [Perrin v.
United States]{.underline}, 444 U.S. 37, 42 (1979); [Neff v. American
Dairy Queen Corp.]{.underline}, 58 F.3d 1063, 1066 (5th Cir. 1995),
*cert. denied*, \_\_\_ U.S. \_\_\_, 116 S. Ct. 704 (1996). Accordingly,
the term "operate" must be given its ordinary meaning, not some meaning
developed in a specialized line of cases dealing with another area of
the law.

Indeed, the argument drawn from the state law cases aside, DIA itself
has offered a common or ordinary definition of the term "operates."
DIA\'s own witness --- its Rule 30(b)(6) designee, Mr. William Keeble
--- suggested that using the common or ordinary definition of the term
was entirely appropriate. As he put it, when asked by DIA\'s counsel
what constitutes the

day-to-day operation of a Days Inn franchised hotel, he replied that
it\'s "not a whole lot different than the day-to-day operation of any
facility or any business." Keeble Dep., Ex. 19, at 768. *See also*
DIA\'s Memorandum at 34. DIA has also enumerated what it believes to be
many of the aspects of the day-to-day operations: as discussed above,
these include setting room rates, marketing, purchasing supplies and
equipment, maintenance, keeping the premises in order, assuring the
cleanliness of rooms, dealing with personnel issues, including hiring
and firing employees, employee policies and compensation, and employee
training, and keeping the hotel\'s books and records. *See supra* 4 n.3.
And as discussed above, DIA exercises considerable control over these
and other aspects of the hotel\'s operations, such that it meets even
DIA\'s common or ordinary definition of what it means to operate a Days
Inn hotel. *See supra* at 4-6.

**IV. CONCLUSION**

For the reasons stated, the United States respectfully requests that
this Court deny DIA\'s motion for summary judgment.

**REQUEST FOR ORAL ARGUMENT**

The United States respectfully requests that the Court grant oral
argument on DIA\'s motion for summary judgment.

Respectfully submitted,

ISABELLE KATZ PINZLER

Acting Assistant Attorney General

Civil Rights Division

JOHN L. WODATCH, Chief

RENEE M. WOHLENHAUS, Acting Deputy Chief

Disability Rights Section

Civil Rights Division

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

THOMAS M. CONTOIS

MARGARITA M. PRIETO

JEANINE M. WORDEN

ROBERTA STINAR KIRKENDALL

Disability Rights Section

Civil Rights Division

U.S. Department of Justice

Post Office Box 66738

Washington, D.C. 20035-6738

\(202\) 514-0196

DIANA RYAN

Assistant United States Attorney

226 Federal Building

515 Ninth Street

Rapid City, South Dakota 57701

Dated: September 20, 1997

[^1]: ^?^As in the United States\' Memorandum in Support of its Motion
    for Summary Judgment, defendants DIA and HFS are referred to
    collectively as DIA, unless the context requires otherwise.

[^2]: ^?^The closest DIA comes to disputing any of these facts is its
    statement that it was Baumann who designed the hotel, and Double H
    that constructed it, implying that it was [only]{.underline} Baumann
    and Double H who designed and constructed the hotel. The inference
    that DIA wishes to draw, however, does not follow from the facts.
    For one thing, the facts clearly show that others were also involved
    in the design and construction of the hotel, including an
    engineering firm and various subcontractors (not to mention DIA).
    Indeed, DIA\'s own expert acknowledged that numerous individuals or
    entities "design" a building; the fact that an individual or entity
    does not do all of the design work for a facility does not mean that
    that individual or entity is not "designing" the facility.
    Deposition of Harold Dean Kiewel, ("Kiewel Dep."), Ex. 20, at 40-41,
    127-29. (References to exhibits in the form "Ex. \_\_" refer to
    exhibits provided with the United States\' Statement of Material
    Facts.)

[^3]: ^?^These include: setting room rates, marketing, purchasing
    supplies and equipment, maintenance, keeping the premises in order,
    assuring the cleanliness of rooms, dealing with personnel issues,
    including hiring and firing employees, employee policies and
    compensation, and employee training, and keeping the hotel\'s books
    and records. DIA Facts ¶¶ 22, 23, 25. *See also* United States\'
    Response to Days Inns of America, Inc. and HFS Incorporated\'s
    Statement of Material Facts ("U.S. Fact Response") ¶¶ 22, 23, 25.

[^4]: ^?^In the course of its argument, DIA repeatedly attempts to
    distort the United States\' position. *See infra* Part III.A.3. One
    of DIA\'s distortions however, requires special mention: DIA claims
    that United States "has acknowledged that, for a party to be liable
    under Section 303, the party\'s conduct must have resulted in an ADA
    violation." DIA\'s Memorandum at 36. In support of this claim, DIA
    cites the testimony of the United States\' Rule 30(b)(6) designee,
    Ms. Elizabeth Savage, at page 199. That portion of Ms. Savage\'s
    testimony, however, simply does not address the issue, and certainly
    does not support DIA\'s claim. Nonetheless, DIA argues that an
    element of causation inheres in section 303: a party\'s conduct,
    according to DIA, must cause a violation of the Standards.
    [Id]{.underline}. The United States has never taken such a position;
    section 303 includes no such requirement. If a party engages in the
    activity prohibited by the statute --- the design and construction
    of an inaccessible facility --- that party has violated the law, and
    can be held liable. Indeed, Ms. Savage specifically testified that
    causation is [not]{.underline} an element of liability under section
    303. Deposition of Elizabeth Savage ("Savage Dep."), Ex. 48, at 121.
    All that is required is a showing that the violation of the
    Standards at issue falls within the scope of the party\'s conduct.
    *See* U.S. Memorandum at 14-15.

[^5]: ^?^As discussed below, when Congress had the opportunity to make
    precisely this choice --- to apply the "owns, leases (or leases to),
    or operates" language to commercial facilities --- it chose not to
    do so. *See* *infra* 12-15.

[^6]: ^?^It is DIA, not the United States, that argues that title III is
    ambiguous. Although it couches its argument in terms of "plain
    language," DIA\'s argument hangs together only if the language of
    section 302 is amended, to resolve the conflict between the scope of
    section 302 and 303. In particular --- although DIA does not
    acknowledge it --- implicit in DIA\'s argument is the suggestion
    that the language in section 302 making liable an entity that "owns,
    leases (or leases to), or operates a place of public accommodation"
    be amended to make liable an entity that "owns, leases (or leases
    to), or operates a place of public accommodation [or a commercial
    facility]{.underline}." The plain language of the statute includes
    no provision whatever regarding entities that own, lease, or operate
    commercial facilities. Because the language of the statute does not
    address such parties, then it necessarily follows from DIA\'s
    argument that the statute is ambiguous, and the government\'s
    position is entitled to substantial deference.

[^7]: ^?^As the agency charged with enforcement of title III of the ADA,
    the Department of Justice has consistently taken the position that
    all parties involved in the design and construction of new
    facilities must conform their involvement, whatever its scope, to
    the requirements of the ADA. *See, e.g.,* U.S. Department of
    Justice, Civil Rights Division, Public Access Section, [THE
    AMERICANS WITH DISABILITIES ACT Title III Technical Assistance
    Manual]{.underline}, Covering Public Accommodations and Commercial
    Facilities, November 1993, Ex. 49, § III-5.1000 at 46.

[^8]: ^?^Indeed, title III\'s remedial provisions allow private actions
    to be brought [before]{.underline} a new facility is built
    inaccessibly. The Act specifically provides that an action may be
    brought by any person \"who has reasonable grounds for believing
    that such person is about to be subjected to discrimination in
    violation of section \[303\].\" 42 U.S.C. § 12188(a)(1). That
    Congress authorized actions against buildings before they are
    completed --- based, presumably, on nothing more than the designs
    for the facility --- further demonstrates the importance Congress
    attached to insuring that those who design new facilities do so in
    compliance with the ADA. If DIA\'s reading of the statute were
    correct, many individuals and entities who design new facilities
    would be excluded from coverage.

[^9]: ^?^Alternatively, Congress could explicitly have limited the
    coverage of section 303 to those entities that exercise control over
    the facility, or over its design and construction. Indeed, as DIA
    itself points out, in title II of the ADA Congress did exactly that
    with respect to the design and construction of new rail facilities.
    42 U.S.C. § 12161(6) (imposing obligations on public entities that
    "exercise\[\] control over the selection, design, construction, or
    alteration" of the facilities in question). DIA\'s Memorandum at
    10-11. Though it clearly knew how to do so, Congress did not limit
    the coverage of section 303 to those entities who have ultimate
    control over the design and construction of new facilities.

[^10]: ^?^Indeed, section 302 of the ADA itself demonstrates that
    Congress has continued to take the same approach here. As discussed
    below, *see* Part III.A.2, as the legislation neared enactment, the
    scope of section 302\'s coverage was expanded to include not just
    those parties who operate public accommodations, but the parties
    that own and lease them as well. In doing so, Congress brought
    within the coverage of section 302 every party that might
    conceivably have responsibility for, or be in a position to ensure
    compliance with, the various non-discrimination requirements of
    section 302.

[^11]: ^?^Indeed, at one point DIA affirmatively took the position that
    both architects and contractors were subject to joint and several
    liability under section 303. *See* Letter dated April 12, 1995 from
    John Russell, President and Chief Operating Officer of Days Inns of
    America, Inc., to Mr. Richard Hauk, Ex. 47, at 1 ("Failure to design
    and construct the facility in accordance with \[the ADA\'s
    architectural\] standards will expose the owner, operator, lessor or
    lessee of the hotel, [as well as the architect and construction
    contractors]{.underline}, to liability under the ADA to correct
    those deficiencies. [Each of these parties is \'jointly and
    severally\' liable]{.underline}." (Emphasis added.))

[^12]: ^?^Indeed, although DIA did not like the answers it got, and went
    to considerable lengths to try to confuse the issue, the United
    States Rule 30(b)(6) designee, Ms. Savage, testified quite clearly
    that "\[y\]our liability is coextensive with the scope of your
    involvement and participation." Savage Dep., Ex. 48, at 81. *See
    also* [id]{.underline}. at 103 ("The test \[under section 303\] is
    that you are involved in the design and construction and that your
    liability is coextensive with the extent of your involvement.")

[^13]: ^?^The same rules would apply under any federal statute. If, for
    instance, an owner directed a contractor to employ only white
    construction workers, or to ignore OSHA requirements, or to dispose
    of hazardous materials improperly, those instructions would not
    allow a contractor to engage in activity prohibited by federal law.

[^14]: ^?^It is, of course, extremely unlikely that an owner would do
    so. The owner pays a significant fee for the privilege of joining
    the Days Inn chain --- for hotels of 100 or fewer guest rooms, an
    intial fee of up to \$35,000, plus a reservation fee of up to
    \$10,000 --- and if those fees are not refundable if the licensee
    breaches the agreement. *See* UFOC, Ex. 1, at 9; Wall License
    Agreement, Ex. 3, ¶¶ 7(a), (b). Thus, as was explained by Mr.
    Hoagland, who was DIA\'s Vice President for Franchise Services and
    Design and Construction from 1992 through 1996, DIA was able to
    prevail on its licensees to make changes the designs for their
    hotels because "if the person has invested into the franchise, you
    know, they\'re not about to stop the project, they\'re going to keep
    going with it . . . ." Hoagland Dep., Ex. 21, at 73-74.

[^15]: ^?^As discussed below, the duty to comply with federal civil
    rights statutes is not delegable. *Infra* at 20-23.

[^16]: ^?^The Supreme Court has defined a non-delegable duty as follows:

    > The concept of a nondelegable duty imposes upon the principal not
    > merely an obligation to exercise care in his own activities, but
    > to answer for the well-being of those persons to whom the duty
    > runs. The duty is not discharged by using care in delegating it to
    > an independent contractor. Consequently, the doctrine creates an
    > exception to the common-law rule that a principal normally will
    > not be held liable for the tortious conduct of an independent
    > contractor. So understood, a nondelegable duty is an affirmative
    > obligation to ensure the protection of the person to whom the duty
    > runs.

    [General Bldg. Contractors Ass\'n v. Pennsylvania]{.underline}, 458
    U.S. 375, 395-96 (1982) (citations omitted). The [General Bldg.
    Contractors Ass\'n]{.underline} case addressed the question of
    whether 42 U.S.C. § 1981 imposed a nondelegable duty on an employer.
    After defining the term, the Court went on to hold that because §
    1981 does not speak in terms of duties, but only declares specific
    rights held by all persons in the United States, it imposed no such
    duty. 458 U.S. at 396. Nothing in the Court\'s opinion, however, is
    contrary to the holdings of several other federal courts that other
    federal civil rights statutes do impose nondelegable duties not to
    discriminate. *See* *infra* at 21-22.

[^17]: ^?^DIA also argues that the United States does not contend that
    DIA controls the day-to-day operations of the Wall Days Inn, or
    other Days Inn hotels. DIA\'s Memorandum at 26. In making this
    argument, DIA relies solely on the uncorrected version of Ms.
    Savage\'s deposition transcript, and disregards a variety of other
    statements by the United States that it does contend that DIA
    controls the daily operations of the hotels in its system, including
    the Wall Days Inn. Indeed, DIA itself has recognized as much,
    acknowedging that in its responses to interrogatories, the United
    States has identified various ways in which DIA controls the
    operations of Days Inn hotels. DIA\'s Memorandum at 27. *See* United
    States\' Reponses to Days Inns of America, Inc.\'s Third Set of
    Interrogatories and Requests for Production, Ex. 50, at 1-9.

    Ms. Savage\'s testimony was not to the contrary. She testified that
    DIA exercised control over the operations of Days Inn hotels in a
    variety of ways, including the reservations system, the operating
    policies manual, other manuals, training programs, QA inspections,
    the Sunburst rating system, DIA\'s central handling of guest
    complaints, and others. Savage Dep., Ex. 48, at 283-85. Indeed, in
    quoting Ms. Savage in its memorandum (and in citing her deposition
    in support of this paragraph), DIA did not consult the errata sheet
    compiled by Ms. Savage upon reviewing the deposition transcript (and
    has not provided that errata sheet as an exhibit). That errata sheet
    makes clear that Ms. Savage\'s testimony is that the United States
    does in fact contend that DIA controls or directs the day-to-day
    functioning of hotels in the Days Inn system, including theWall Days
    Inn. *See* [id]{.underline}., errata sheet.

[^18]: ^?^Indeed, DIA itself has acknowledged that operating a hotel
    includes a variety of decisions and functions, none of which has
    anything to do with removal of architectural barriers to access.
    *See* *supra* 4 n.3, 4-6. DIA does not explain how to reconcile its
    definition of who operates a facility with [Neff]{.underline},
    which, as DIA puts it, "teaches that an \'operator,\' for purposes
    of liability under the ADA, is someone who actually causes a
    facility to comply or not comply with the ADA\'s requirements." It
    is difficult to imagine a definition of operates which is farther
    removed from the ordinary or common meaning of the term (which is
    what [Neff]{.underline} initially suggests is the way the term must
    be construed). 58 F.3d at 1066.

[^19]: ^?^The [Neff]{.underline} court does not explain, for instance,
    how (by any definition of \"operates\") a party who has control over
    the ability to make physical changes to the facility, but who has no
    other control over the business conducted there, nonetheless
    \"operates\" the facility. If such a party does \"operate\" the
    facility, the [Neff]{.underline} court fails to explain either 1)
    why it makes sense to hold that party responsible for the other
    obligations of section 302(b) as well --- such as providing
    auxiliary aids and services, or modifying the business\' policies
    and practices, or 2) if the party is not to be held liable for those
    obligations, why not (since the party has already been held to be
    \"operating\" the facility).

[^20]: ^?^Although it came to a contrary conclusion, the
    [Aikins]{.underline} court applied a similar analysis in finding
    that a physician did not operate a hospital within the meaning of
    the ADA. The court found that because he not only had no control
    over the specific prohibited activity --- the requirement to provide
    auxiliary aids and services to individuals who are deaf --- but also
    because he was \"not on the hospital\'s board of directors, and
    \[had\] no authority to enact or amend hospital policy,\" he did not
    \"operate\" the hospital within the meaning of title III. 843
    F.Supp. at 1335.

[^21]: ^?^[Neff]{.underline}, 58 F.3d at 1065 (\"Neff\'s only summary
    judgment evidence, and the only basis for her claim . . . is the
    Nacogdoches Store franchise agreement. . . . Neff has not alleged
    that the . . . franchise agreement is ambiguous. Indeed, the parties
    do not dispute the meaning of the terms of the agreement. . . \")
    (Citations omitted.).

[^22]: ^?^Although DIA relies on this same portion of the
    [Neff]{.underline} opinion --- *see* DIA\'s Memorandum at 20 --- DIA
    appears to contend that under [Neff]{.underline}, even a showing of
    control over the discriminatory conduct at issue is not enough.
    Rather, DIA contends that there must also be some showing that the
    franchisor "caused" the facility not to comply with the ADA. While
    DIA plainly reads into [Neff]{.underline} an element that is not
    there, even if DIA's interpretation were correct, and it was
    necessary to show not just that DIA had control over the
    discriminatory conduct at issue, but also that DIA actually caused
    the violations of the ADA, the United States has made that showing.
    The undisputed facts show that DIA caused the Wall Days Inn to be
    inaccessible: the PDSM which DIA provided to the Baumann and Double
    H was not consistent with the ADA, U.S. Facts ¶¶ 35-37, 49, 70; when
    DIA reviewed plans for the Wall hotel, it did not review them for
    compliance with the ADA, or for compliance with DIA\'s own
    barrier-free requirements, U.S. Facts ¶¶ 122-26; and when DIA
    inspected and admitted the Wall hotel into the Days Inn system, it
    ignored or failed to note blatant violations of the ADA, and failed
    to require the Hauks to bring the facility into compliance with the
    ADA, as required by the license agreement and the PDSM. U.S. Facts
    ¶¶ 16, 77, 78, 100, 111.c.i.

[^23]: ^?^Whatever else it does, [Neff]{.underline} certainly does not
    address the question of who may be held liable under section 303 of
    the ADA. The restaurants at issue in [Neff]{.underline} predated the
    ADA, and the provision of the ADA at issue was the provision
    requiring the removal of architectural barriers to access in
    existing facilities. 58 F.3d at 1064, 1064 n.1. *See also* 42 U.S.C.
    § 12182(b)(2)(A)(iv). The [Neff]{.underline} Court thus had no
    occasion to address the scope of coverage of section 303.

[^24]: ^?^It is not surprising that the PDSM exceeds what is required by
    the Lanham Act, given that the PDSM was originally developed not for
    the purposes of quality control for franchisees, but in connection
    with actual construction projects undertaken by DIA\'s predecessor
    in interest. *See* U.S. Facts ¶ 31. The manual was later distributed
    to franchisees, a practice which DIA continued when it took control
    of the company. U.S. Facts ¶ 31.a.

[^25]: ^?^Indeed, it is well established that federal, not state, law
    must define the contours of federal civil rights protections. As the
    Sixth Circuit observed, when confronted with an issue of whether
    state law of agency would govern a claim under the Fair Housing Act,
    "prior decisions in other areas of civil rights direct us to use
    federal --- not state --- law." [Marr v. Rife]{.underline}, 503 F.2d
    735, 740 (6th Cir. 1974) (discussing prior cases). That Court went
    on to explain that

    > \[a\]n examination of the \[Fair Housing\] Act reveals a broad
    > legislative plan to eliminate all traces of discrimination within
    > the housing field. To allow such a purpose to be controlled by
    > state law might well defeat this objective. We believe that in
    > such a situation this Court is not restricted by the law of the
    > various states, and that it should apply federal law.

    [Id]{.underline}. (citation omitted).