UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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THE UNITED STATES OF AMERICA,

Plaintiff,

\- against - Civil Action No.

CV-96-2935 (ARR)

THE NEW YORK STATE DEPARTMENT

OF MOTOR VEHICLES; THE NEW YORK

STATE DEPARTMENT OF EDUCATION;

and the THREE VILLAGE CENTRAL

SCHOOL DISTRICT,

Defendants.

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MEMORANDUM OF LAW IN REPLY TO DEFENDANTS' OPPOSITION

TO PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AND IN

[OPPOSITION TO DEFENDANTS' CROSS-MOTIONS FOR SUMMARY
JUDGMENT]{.underline}

LORETTA E. LYNCH

United States Attorney

Eastern District of New York

1 Pierrepont Plaza

Brooklyn, New York 11201

\(718\) 254-6249

SANFORD M. COHEN

Assistant U.S. Attorney

([Of]{.underline} [Counsel]{.underline})

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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THE UNITED STATES OF AMERICA,

Plaintiff,

\- against - Civil Action No.

CV-96-2935 (ARR)

THE NEW YORK STATE DEPARTMENT

OF MOTOR VEHICLES; THE NEW YORK

STATE DEPARTMENT OF EDUCATION;

and the THREE VILLAGE CENTRAL

SCHOOL DISTRICT,

Defendants.

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MEMORANDUM OF LAW IN REPLY TO DEFENDANTS' OPPOSITION

TO PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AND IN

[OPPOSITION TO DEFENDANTS' CROSS-MOTIONS FOR SUMMARY
JUDGMENT]{.underline}

[PRELIMINARY STATEMENT]{.underline}

Plaintiff, the United States of America (\"United States\"), submits
this memorandum in reply to the opposition of defendants New York State
Department of Motor Vehicles ("DMV"), New York State Department of
Education ("SED") and the Three Village Central School District ("the
District") to the United States' motion for summary judgment, and in
opposition to defendants' cross-motions for summary judgment.

This is an action brought pursuant to Section 107 of the Americans with
Disabilities Act of 1990 (\"ADA\"), 42 U.S.C. § 11217, and Section
707(a) of Title VII of the Civil Rights Act of 1964, alleging that
defendants engaged in a pattern or practice of resistance to rights
secured by the ADA by excluding from employment as bus drivers persons
who were missing a foot, leg, hand or arm because of their disability.
In conformity with their openly declared policy of excluding from
employment as bus drivers persons who were missing a limb \-- at least
those who lost a limb in July 1978 or later \-- defendants blocked the
restoration to his job of Theodore Bacalakis, a school bus driver whose
leg was amputated following an off-duty accident. Although defendants
rescinded their policy following plaintiff's commencement of this
action, and Mr. Bacalakis was restored to his position, his lost
earnings and benefits remain unpaid, and his personal damages have not
been fully compensated.

In its opening memorandum, plaintiff demonstrated that Mr. Bacalakis is
a "qualified person with a disability" within the meaning of the ADA,
Memorandum of Law in Support of the United States' Motion for Summary
Judgment ("Plaintiff's Mem."), at 18-21, that he suffered an adverse
employment action as a consequence of the defendants' enforcement of
their policy, [id]{.underline}. at 21-23, that defendants are covered
entities for purposes of liability under the statute, [id]{.underline}.
at 23-32, and that Mr. Bacalakis is entitled to back-pay.
[Id]{.underline}. at 32-36. None of the defendants disputes that Mr.
Bacalakis was a qualified person with a disability during the period
that his restoration to employment was barred, or that the refusal of
his direct employer, Amboy Bus Company, to rehire him resulted from
defendants' policy prohibiting the employment of amputees as bus
drivers.

The state defendants, DMV and SED, do not dispute that their policy,
expressed in regulations, proscribed Mr. Bacalakis's employment. They
contend, however, that their regulations cannot be the reason that Mr.
Bacalakis's employment was barred because the regulations were in
conflict with and pre-empted by the ADA, and therefore a legal nullity.
Memorandum of Law in Support of the State Defendants' Cross-Motion for
Summary Judgment ("State Deft's Mem."), at 6-8. In addition, advancing a
doctrine never adopted by the Court of Appeals for the Second Circuit,
they contend that their interference with Mr. Bacalakis's employment
relation with Amboy is beyond the reach of Title I of the ADA because it
was an exercise of the State's "police power." [Id]{.underline}. at
8-14. In a similar vein, the District disavows any responsibility for
Amboy's refusal to rehire Mr. Bacalakis, even though Amboy acted in
conformity with the obligations imposed by the contract with the
District, because the District never declared that it had invoked the
obligation \-- enjoined upon it by law \-- to bar the employment of
amputees. Memorandum of Law in Support of Cross Motion for Summary
Judgment on behalf of Defendant Three Village Central School District
and in Opposition to Plaintiff's Motion for Summary Judgment
("District's Mem."), at 2-22. All defendants assert that, even if they
are liable under the ADA, Mr. Bacalakis should be denied back-pay and
compensation because he did not make diligent efforts to obtain
comparable work during the period they prohibited his rehiring. State
Deft's Mem. at 14-21; District's Mem. at 23.

Plaintiff shows below that defendants' arguments are incorrect and that
summary judgment should be granted in plaintiff's favor finding them
liable and awarding back-pay to Mr. Bacalakis.

[ARGUMENT]{.underline}

[POINT I]{.underline}

> DEFENDANTS VIOLATED THE AMERICANS
>
> [WITH DISABILITIES ACT OF 1990    ]{.underline}

A. The Fact that the ADA Pre-empted the State Regulations Does [Not
Relieve the State Defendants of Liability]{.underline}

The State defendants concede that the "regulations in question \[15
N.Y.C.R.R. § 6.11(b)(1) and 8 N.Y.C.R.R. § 156.3(c)\] were inconsistent
with, and pre-empted by, the ADA, as this Court has already held. [EEOC
v. Amboy Bus Co.]{.underline}, 96 CV 5451 (ARR)(August 19, 1998), at pp.
9-11." State Deft's Mem. at 6. From that concession, however, they leap
dramatically to the conclusion that the State defendants cannot be held
liable for the consequences of their discriminatory policy. They state:

> \[T\]he very act of asserting that a state regulation violates the ADA
> necessarily presupposes that the ADA pre-empts the state regulations
> in question as a matter of law. Accordingly, the State regulations in
> question did not prevent Mr. Bacalakis from resuming his work as a bus
> driver. Insofar as State and federal law were inconsistent, federal
> law clearly controlled. Therefore, had Amboy and the District followed
> the dictates of federal law, Mr. Bacalakis would have been reinstated.

[Id]{.underline}. at 7-8. The State defendants' argument is bizarre. It
may represent the singular occasion that any defendants have argued that
they should be insulated from liability not because their actions were
lawful, but because their policy and conduct so violated federal law
that those subject to them \-- the District and Amboy -- should have
ignored them.

What occurred in this case is far different from the circumstances of
[EEOC v. State of Illinois]{.underline}, 69 F.3d 167 (7^th^ Cir. 1995),
upon which the State defendants rely. In that case, the state statute
that conflicted with a federal law, the Age Discrimination in Employment
act, laid in desuetude for two years until the state legislature
rescinded it. The court found no evidence and refused to "indulg\[e\] .
. . an assumption" that "local school districts . . . risked losing
state funding" if they did not comply with the discriminatory state law.
[Id]{.underline}. at 169. The Seventh Circuit thus described the issue,
as whether, in the absence of evidence of any affirmative act by the
State to enforce its policy, the State was liable under the ADEA for
failing to notify school districts that the state law was a nullity. It
found that the mere failure of the State to make that notification was
insufficient to establish a violation of federal law. [Id]{.underline}.
at 170("\[I\]t might be a good thing for the state to take steps to
minimize the likelihood of an inadvertent violation of law by its
subdivisions. But the failure to do so is not our idea of aiding and
abetting a violation.")

But the Seventh Circuit recognized, notwithstanding the pre-emption
doctrine, that the result would be different if the State played an
affirmative role in implementing discriminatory state rules:

> Were the state pulling the strings in the background \-- telling the
> local school districts whom to hire and fire and how much to pay them
> \-- a point would soon be reached at which the state was the de facto
> employer and the local school districts merely its agents. That point
> was not reached here. There is no suggestion that the state knew about
> these two teachers or wanted them to resign. The provision of the
> school code requiring retirement at age 70 cannot be treated as a
> firing directive by the state, because the provision was invalid and
> there is not evidence that the state made any effort to enforce it.

[Id]{.underline}. at 171.

Here, there is abundant evidence that the State defendants did not deem
the regulations in question pre-empted, and that they actively enforced
the discriminatory requirements of the regulations. Plaintiff has
already set out in detail the comprehensive scheme of statutes and
regulations that provide extensive control to DMV and SED over the
employment of bus drivers, a scheme that is fortified, in the case of
DMV, with the threat that a non-complying common carrier will suffer
fines and license revocation, and, in the case of non-complying school
districts, that they will lose state transportation aid. Plaintiff's
Mem. at 2-6; [see]{.underline} [also]{.underline} Affidavit of Eileen
McCarthy, dated June 2, 1999, at ¶¶ 15, 16 ("The Three Village Central
School District is a public school district subject to the supervision
and control of the Commissioner of Education and as such its officers
could be removed from office or have state funds withheld for failure to
follow directives, decisions, orders, rules or regulations of the
Commissioner.")

The State agencies, moreover, were explicit in Mr. Bacalakis's case,
that they did not deem their regulations pre-empted and that they
intended to enforce them. Thus, when Mr. Bacalakis, at the urging of
Amboy's depot manager, wrote a letter to Thomas W. Fullington, Assistant
Director of the Bus Driver Certification Unit of DMV, in an effort to be
re-employed, Fullington replied by reciting the provisions of 15
N.Y.C.R.R. § 6.11(b)(1) and advising Mr. Bacalakis that, under DMV and
SED regulations, Mr. Bacalakis could \"not be considered physically
qualified to drive any vehicle defined as a bus\[.\]\" (Answer of
Defendants DMV and SED, ¶ 17; Cohen Decl., Exh. E). Similarly, when the
District's transportation coordinator, Ms. McCarthy, inquired of SED's
transportation director, Mr. Comeau, whether Mr. Bacalakis could be
qualified to drive a bus, or whether an exception to the State
regulations could be made, Mr. Comeau gave an angry response:

> Absolutely not can you make an exception to what is the law, and you
> as a School District are required to follow the law. If you were to do
> otherwise, your entire district and you represent them, Eileen, would
> be legally liable.

(McCarthy Dep. at 61). Mr. Comeau told Ms. McCarthy that there could be
no exception from the law prohibiting Mr. Bacalakis from being employed
as a school bus driver. ([Id]{.underline}. at 61 - 62).

After Mr. Bacalakis filed charges against the State defendants with the
EEOC, the State defendants continued affirmatively to advance the
legitimacy of their regulations. By letter dated May 5, 1994, Van
Holland, Director of Affirmative Action Programs for DMV, advised the
EEOC that, in view of the amputation of his leg, Mr. Bacalakis was \"not
qualified\" to operate a bus in New York State under the Motor Vehicles
Commissioners' regulations. (Cohen Decl., Exh. K) In a letter dated June
17, 1994, Kathleen Surgalla, Assistant Counsel to SED, advised the EEOC
that Mr. Bacalakis was ineligible to drive a school bus under the then
existing 8 N.Y.C.R.R. § 156.3(c)(1). (Cohen Decl., Exh. I)

Indeed, even after the EEOC issued probable cause determinations against
DMV and SED, the agencies refused to abandon their position that the
regulations were legitimate. Further, representatives of DMV and SED
advised the EEOC that a gubernatorial memorandum precluded any changes
in the state regulations at that time. ([See]{.underline} Cohen Decl.,
Exh Q (Affidavit of Elizabeth Singletary, EEOC Investigator, in
[EEOC]{.underline} v. [Amboy Bus Company]{.underline}, dated January 17,
1997) at p.2, ¶ 8; Executive Order No. 2, dated January 5, 1995;9
N.Y.C.R.R. § 5.2 (establishing a moratorium on the adoption of any rule
or regulation by any New York State department or agency).

The State Defendants do not refute any of that. Yet, even now, they
argue that SED's insistence that the District and Amboy comply with its
regulations, backed by the threat of withholding State aid, should not
lead to a judgment holding it liable under the ADA for discrimination
against Mr. Bacalakis because "a competently counseled school district
\[or bus company\] would have told the state to go fly a kite." State
Deft's Mem. at 7 (quoting [EEOC v. State of Illinois]{.underline}, 69
F.3d at 170).

This Court properly found Amboy liable for not taking action to
challenge defendants discriminatory policy in the face of superceding
contrary federal law. Nothing in the Court's decision, however, suggests
that the government defendants, which required Amboy to violate the ADA,
should be absolved of responsibility. Given the State defendants'
determination to enforce the discriminatory policy for three years after
receiving notice of a challenge to it, they are liable as well. It
simply cannot be the law that the State defendants are insulated from
responsibility for injury to Mr. Bacalakis because the District and
Amboy lacked the desire or will to challenge the State's unlawful rules
and conduct.

B. [DMV and SED are Covered Entities under the ADA]{.underline}

The State agencies further contend that they cannot be held liable for
Mr. Bacalakis's lost income and other injuries because they are not
"covered entities" under 42 U.S.C. §§ 11212(a) and 11211(2). DMV and SED
do not dispute that they interfered with Amboy's rehiring of Mr.
Bacalakis through their regulations." State Deft's Mem. at 10. They
argue, however, that the definition of the term "employer," one of the
defined covered entities under the ADA, "does not extend to a state
acting in a regulatory capacity under its police power, even if the
state's regulations significantly affect one's access to the job
market." [Id]{.underline}. at 9.

The Second Circuit, however, when explaining the interference theory of
"employer" under the antidiscrimination laws, has never embraced the
doctrine advanced by defendants which purportedly distinguishes between
the state acting in its proprietary capacity and under its police
powers. To the contrary, when it first articulated the interference
theory in [Spirt v. Teachers Insurance and Annuity
Association]{.underline}, 691 F.2d 1054 (2d Cir. 1982), the Court of
Appeals specifically relied on cases in which a state or other
governmental entity was deemed an employer under Title VII where it
interfered with employment relationships by exercising its regulatory
authority:

> \[I\]t is generally recognized that \"the term \'employer,\' as it is
> used in Title VII, is sufficiently broad to encompass any party who
> significantly affects access of any individual to employment
> opportunities, regardless of whether that party may technically be
> described as an \'employer\' of an aggrieved individual as that term
> has generally been defined at common law.\" [Vanguard Justice Society,
> Inc. v. Hughes]{.underline}, 471 F.Supp. 670, 696 (D.Md.1979). See
> also [Baker v. Stuart Broadcasting Co.]{.underline}, 560 F.2d 389, 391
> (8th Cir. 1977); [Sibley Memorial Hospital v. Wilson]{.underline}, 488
> F.2d 1338 (D.C.Cir.1973); [EEOC v. Wooster Brush Co.]{.underline}, 523
> F.Supp. 1256, 1261-62 (N.D. Ohio 1981); [Puntolillo v. New Hampshire
> Racing Commission]{.underline}, 375 F.Supp. 1089 (D.N.H.1974).

691 F.2d at 1063. The Circuit's citations to [Vanguard Justice
Society]{.underline} and [Puntolillo]{.underline} are particularly
significant. Both are cases in which a governmental entity was found to
be an employer for purposes of Title VII, even though it was not the
direct employer of the aggrieved individual, and even though the
challenged conduct involved the government's interference in the
employment relationship between the plaintiff and a third party through
its exercise of regulatory authority pursuant to police powers.

In [Vanguard Justice Society]{.underline}, the plaintiffs alleged claims
of race and sex discrimination in the hiring of police officers by the
Baltimore Police Department. Under the state and municipal statutory
scheme, hiring decisions were within the sole province of the Police
Commissioner, who had the exclusive authority "\[t\]o appoint, promote,
reduce in rank, grade or position, reassign, reclassify, retire and
discharge all members of the Department in the manner prescribed by law.
471 F.Supp. at 690. The City Charter gave the Baltimore Civil Service
Commission only the limited authority in the hiring process to
"ascertain the relative qualifications for all candidates for
appointment at the entrance level to the department and for promotional
appointment within the department by competitive examinations and such
other tests as in its judgment may be necessary." [Id]{.underline}. at
692. Nevertheless, the City of Baltimore was found to be an employer for
purposes of Title VII, notwithstanding the "concededly limited role in
the hiring process" of the Baltimore City Civil Service Commission,
because the Commission "exercised substantial authority and discretion
in the area of testing of applicants for entry level positions with the
Department." [Id]{.underline}. at 696. In other words, the Civil Service
Commission was deemed an employer because it established qualifications
for the hiring police officers that interfered with the potential
employment relationship between applicants and a third party, the Police
Department. In the same way, DMV and SED establish the qualifications
for the employment of school bus drivers, and using invidious criteria
to preclude the hiring of persons missing limbs, interfered in the
relationship between Mr. Bacalakis and Amboy. [See]{.underline}
[also]{.underline} [United States v. City of Yonkers]{.underline}, 592
F.Supp. 570, 591 (S.D.N.Y. 1980)(State Civil Service Commission, which
provided to municipality entry test for police officers, was employer
for purposes of Title VII with respect to municipality's hiring of
officers).

Similarly, in [Puntolillo]{.underline}, the plaintiff, a harness horse
driver-trainer brought suit under Title VII against a state agency, the
New Hampshire Racing Commission, alleging that it had denied him a
license because of his national origin, and thereby prevented him from
obtaining employment with harness horse owners, who "hire and fire and
pay the driver-trainers and, as a practical matter, stand in the shoes
of the employer vis-a-vis the driver-trainers." 375 F.Supp at 1090.
Relying on [Sibley Memorial Hospital v. Wilson]{.underline}, 488 F.2d
1338 (D.C. Cir. 1973) and other cases, the district court found that the
Commission was an employer under Title VII.

Indeed, though the State defendants assert that the "\[c\]ourts in this
Circuit have long recognized that government agencies do not become
'employers' simply by regulating," they cite in support of that
contention only two, twenty-year-old, district court opinions. State
Deft's Mem. at 11-13 (citing [National Organization for Women, New York
Chapter, v. Waterfront Commission of New York Harbor]{.underline}, 468
F.Supp. 317 (S.D.N.Y. 1979) and [Lavender-Cabellero v. Department of
Consumer Affairs]{.underline}, 458 F.Supp. 213 (S.D.N.Y. 1978). Both of
those cases were decided long before the decision of the Court of
Appeals in [Spirt]{.underline}. Yet while the Circuit cited
[Puntolillo]{.underline} in support of its holding, the district court
in [National Organization for Women]{.underline} opined that
[Puntolillo]{.underline} was wrongly decided. 468 F.Supp. at 320
([Puntolillo]{.underline} rests "on a misapplication of the District of
Columbia Circuit\'s opinion in [Sibley Memorial Hospital v.
Wilson]{.underline}.")[^1] Similarly, cases from other circuits cited by
the State defendants do not mention [Sibley]{.underline} at all, another
case on which the [Spirt]{.underline} court relied heavily.
[See]{.underline} State Deft's Mem. at 13 (citing [United States v.
Board of Education]{.underline}, 911 F.2d 882, 891 (3d Cir. 1990);
[Haddock v. Board of Dental Examiners]{.underline}, 777 F.2d 462 (9^th^
Cir. 1985); [Woodward v. Virginia Board of Bar Examiners]{.underline},
598 F.2d 1345 (4^th^ Cir. 1979); [Tyler v. Vickery]{.underline}, 517
F.2d 1089 (5^th^ Cir. 1975).[^2]

In short, the most authoritative source of what is the law in the Second
Circuit, the Court of Appeals, has eschewed the "police power"
distinction on which the State defendants rely. Instead, it has cited
with approval cases where governmental agencies, acting under their
regulatory authority, were deemed to be employers under the interference
doctrine.

Moreover, [Lavender-Cabellero]{.underline}, [National Organization for
Women]{.underline}, and the licensing board cases cited by the State
defendants all involved the abstract question whether the plaintiff
would be granted permission to practice a profession or trade rather
than whether the board's actions barred the plaintiff from obtaining a
specific job with a third party. In contrast, the state laws and
regulations in this case are designed precisely to allow the State
defendants to interfere with an identified employment relationship
between the aggrieved individual and a specific employer.
[See]{.underline} [e]{.underline}.[g]{.underline}. N.Y. Vehicle &
Traffic Law § 509-g(1)("Before [employing]{.underline} a new bus driver
a motor carrier shall: (i) require such person to pass a medical
examination to drive a bus as provided in section five hundred nine-g of
this article")(emphasis added); N.Y. Education Law § 3624 ("The
[employment]{.underline} of each driver shall be approved by the chief
school administrator of a school district for each school bus operated
within his district")(emphasis added). That is precisely what occurred
in this case. Through the implementation and enforcement of their
invidiously discriminatory regulations, the State defendants interfered
with the employment relationship between Mr. Bacalakis and Amboy. Under
the law of this Circuit, they are covered entities and are liable under
the ADA.

There is also an alternative ground under which DMV and SED are liable
in this case. Plaintiff brought this action under the "pattern or
practice" provision of section 707 of Title VII, 42 U.S.C. § 2000e-6,
which is incorporated as an enforcement mechanism under the ADA.
[See]{.underline} 42 U.S.C. § 11217.[^3] Under that section, "\[o\]ne
need not be the employer of the employees whose Title VII rights are
endangered in order to be liable . . . , but the Attorney General must
demonstrate the existence of a \"pattern or practice\[.\]\" [United
States v. Board of Education]{.underline}, 911 F.2d at 892. In order to
establish the defendants' liability under Section 707, the United States
must establish that the "discrimination was the defendant\'s standard
operating procedure\--the regular rather than the unusual practice.\"
[International Bd. of Teamsters v. United States]{.underline}, 431 U.S.
324, 336 (1977). That burden is met where, as here, the discrimination
at issue is "openly declared" by the defendant, through, for example,
publication by the State in its regulations. [Id]{.underline}.;
[see]{.underline} [also]{.underline} [United States v.
Gregory]{.underline}, 871 F.2d 1239, 1243 (4th Cir.1989) (\"\[I\]f
admissions \[as to existence of a policy\] are credited, the Title VII
violation had been proven.\").

It is apparent that DMV and SED were engaged in a pattern or practice of
resistance to the full enjoyment of rights secured by the ADA. Their
regulations openly declared that a person missing a limb could not be
employed as a bus driver, a policy which this Court found \-- and
defendants concede \-- was in violation of the ADA. Accordingly, relief
against the State defendants, including an award of back-pay and other
damages, may be awarded pursuant to Section 707.

C. [The District Interfered with the Employment Relationship Between Mr.
Bacalakis and Amboy and is Liable under the ADA]{.underline}

The District's argument that it is not liable under the ADA for
employment discrimination against Mr. Bacalakis, though couched in terms
of the requirements of a [prima]{.underline} [facie]{.underline} case
under [McDonnell-Douglas v. Green]{.underline}, 411 U.S. 792 (1973) and
its progeny, resolves to two main points: (1) that the District is not a
covered entity because it did not control the hiring of Amboy bus
drivers who provided District transportation services, and (2) that the
District did not take any action that amounted to a denial of Mr.
Bacalakis's request to be restored to employment. However, in its
affidavit in support of its cross-motion, its extended discussions of
the theoretical underpinnings of the various bases under which an entity
may be considered an employer under the antidiscrimination laws, and its
recounting of the specific events of this case, the District assiduously
avoids any mention of critical facts: that Amboy acted pursuant to and
in conformity with the specific discriminatory employment standards in
its contract with the District when it refused to restore Mr.
Bacalakis's employment.[^4]

Under the contract, consistent with the requirements of N.Y. Education
Law §§ 3624 and 3625, the District retains substantial control over the
hiring of bus drivers for the district. For example, Section IV(G) of
the contract with Amboy provides that:

> The names of all prospective Drivers, whom the Contractor expects may
> operate a Bus with student passengers under the terms of this
> contract, must be submitted to the District by the Contractor for
> District approval. The District shall withhold or withdraw approval of
> any Driver who does not comply with any provision of this contract.
> The District may, in the prudent exercise of its sound discretion,
> withhold or withdraw approval for any other reason. At
> [no]{.underline} time shall any Bus carrying student passengers under
> this contract be operated by other than an approved Driver.

McCarthy Dep., Exh. 1, p.21 (emphasis in original). Section IV(A) of the
contract requires drivers to obtain certification from a physician that
he meets the physical requirements set forth in the regulations
promulgated by the State Defendants, and thereby incorporates the very
discriminatory conditions of employment at issue in this case.
[Id]{.underline}., at 17. Section IV(B) of the contract requires the
driver's annual submission of an "application for Approval of
Employment" to the District for approval, and provides that "No Driver
is to be assigned to perform any part of this contract prior to such
approval by the District." [Id]{.underline}. at 18. Under Section IV(F),
the District "reserves the right to have the bus Contractor replace
[immediately]{.underline} those drivers the \[District\] determines
unsatisfactory." [Id]{.underline}. at 20 (emphasis in original). And
pursuant to Section II(D), Amboy is liable in liquidated damages for
using a driver who is not approved by the Superintendent.
[Id]{.underline}. at 11.

When Amboy refused to restore Mr. Bacalakis to his job, it acted
pursuant to specific discriminatory employment standards imposed on
Amboy by the District in a contract required by SED. If Amboy had not
complied with those standards and restored Mr. Bacalakis, it would have
owed the District monetary penalties. Thus, the District exercised
contractual provisions that have all of the attributes of the "control"
necessary under the interference theory adopted by the
[Spirt]{.underline} court to make the District an employer for purposes
of the ADA. [See]{.underline} [People of the State of New York v.
Holiday Inns, Inc.]{.underline}, 1993 WL 30933 (W.D.N.Y., Jan. 28, 1993
at \*6)("\[I\]n order to hold a third party liable under Title VII or
the ADEA, the third party must have exercised a direct and significant
degree of control over the complaining party's direct employer or the
complaining party's 'work environment.' The "control" necessary under an
interference theory is not be confused with, nor is the same as, the
'right to control' which is necessary to find an employer/employee
relationship. Rather it is the degree of control necessary to allow a
third party to influence or interfere with an employee's employment
opportunities.")

The District protests, however, that while Amboy complied with the very
discriminatory employment standards the District required it to enforce
when it refused to restore Mr. Bacalakis, the District cannot be held
liable because the District never passed on a written application
tendered by Mr. Bacalakis. Indeed, it makes much of the fact that Mr.
Bacalakis did not complete one of the District's employment
applications, though it concedes that it was aware that he sought
restoration to the job. But the fact is that when Mr. Bacalakis appeared
at Amboy numerous times over three years to obtain restoration to his
job, he was not given the opportunity to complete an employment
application. [See]{.underline} Bacalakis Dep. at 88-89.

Although the District had every opportunity to remedy the discriminatory
operation of its contract, it stood by as the discriminatory contract
with Amboy and the state regulations kept Mr. Bacalakis unemployed. At
her deposition, the District's transportation coordinator, Ms. McCarthy,
testified about her meeting with Mr. Bacalakis in the fall of 1993, when
he spoke directly to her about his desire to be re-employed:

Q. Did you make any suggestion to Mr. Bacalakis during the conversation
of December 1993 that he complete an application for employment with
Amboy?

A. No, I didn't.

Q. Is there a reason that you didn't?

A. It just never entered my mind for him to submit an application.

Q. But you knew he wanted to be employed, correct?

A. I knew he wanted to return to work.

Q. And you knew the process for doing that required him to complete an
application, is that right?

A. Yes.

Q. And knowing that, is there a reason why you didn't suggest to Mr.
Bacalakis that he complete an application?

A. Well, I knew that he wasn't going to be able to pass the physical
examination.

\* \* \* \* \* \* \*

Q. Did you ask Amboy at any point to reinstate Mr. Bacalakis as a bus
driver?

A. No, I did not.

Q. Is there a reason that you didn't?

A. It actually would be inappropriate.

Q. In what sense would it be inappropriate?

A. Well, how could I request them to reinstate a driver that I knew they
couldn't submit to the District the proper and appropriate physical
examination papers, et cetera. You know, I would be acting
inappropriately.

Q. When you say you would be acting inappropriately, you would be acting
inappropriately because it would have violated state requirements?

A. Exactly.

McCarthy Dep., 67-71.

In sum, by exercising significant control through its contract over the
hiring decisions of District drivers made by Amboy and by its other
conduct, the District interfered with the employment relationship
between Mr. Bacalakis and Amboy. There is ample proof that it is an
employer and a covered entity within the meaning of the ADA under the
law of this Circuit.

[POINT II]{.underline}

[THE COURT SHOULD AWARD BACK PAY]{.underline}

Defendants contend that the Court should deny back pay to Mr. Bacalakis,
to which he is presumptively entitled under the ADA, because he did not
diligently seek comparable employment and thereby failed to mitigate his
damages. The State Defendants argue that Bacalakis failed to mitigate
because he did not make diligent efforts to regain his job at Amboy by
appealing to the Commissioner of Education or seeking a waiver of the
State regulations from the Federal Highway Administration. State Deft's
Mem. at 19. The District does not even suggest how Bacalakis could have
made efforts to find comparable employment in a position from which he
was barred by State regulations. District's Mem. at 23.

We recognize, of course, that a victim of employment discrimination is
obligated to mitigate damages. A claimant \"forfeits his right to back
pay if he refuses a job substantially equivalent to the one he was
denied.\" [Ford Motor Company v. EEOC]{.underline}, 458 U.S. 219, 232
(1982). But \"the unemployed or underemployed claimant need not go into
another line of work, accept a demotion or take a demeaning position.\"
[Id]{.underline}. at 231 and n.16;[^5] [see]{.underline} [Hawkins v.
1115 Legal Service Care]{.underline}, 163 F.3d 684, 695-96 (2d Cir.
1998). In order to reduce the meritorious claimants' entitlement to back
pay, "the defendant employer has the burden of demonstrating that \[the
plaintiff\] has failed to attempt to mitigate . . . by establishing (1)
that suitable work existed, and (2) that the employee did not make
reasonable efforts to obtain it." [Id]{.underline}. at 695 (citing
[Dailey v. Societe Generale]{.underline}, 108 F.3d 451, 456 (2d Cir.
1997).

Defendants seek to invoke the rule recently adopted by the Second
Circuit that an employer "is released from the duty to establish the
availability of comparable employment if it can prove that the employee
made no reasonable efforts to seek such employment." [Greenway v.
Buffalo Hilton Hotel]{.underline}, 143 F.3d 47, 54 (2d Cir. 1998). But
that rule is inapplicable in this case. Mr. Bacalakis, a high school
graduate and amputee, had spent his entire working career from the age
of 22 as a District school bus driver with Amboy. He was barred by the
State defendants' regulations from obtaining another job as a school bus
driver in another district, the only work comparable to the employment
he had held. Indeed, other than the State defendants' specious
statements that he should have pursued more aggressively his effort to
be restored to Amboy employment, defendants do not suggest \-- even in
the abstract \-- the type of employment Bacalakis could have obtained
that would have been consonant with his particular skills, background,
and experience and would not have involved conditions substantially more
onerous than his position as a school bus driver.

[Padilla v. Metro-North Commuter Railroad]{.underline}, 92 F.3d 117 (2d
Cir. 1996) raised a similar issue. There, the employer illegally demoted
the plaintiff from his position as superintendent of train operations
for the railroad, a position that he had held from the age of 22 and for
which he was uniquely qualified. The employer challenged an award of
front pay on the ground that Padilla had not actively sought a position
as a superintendent of train operations with another railroad. The
evidence showed, however, that there were only three other such
positions in the relevant geographic area and little likelihood that any
of them was or soon would be available, and that there were no
comparable positions in other industries. Applying the same mitigation
standards applicable to an award of back pay, the court refused to bar
front pay relief to the plaintiff. "In view of the absence of evidence
that suitable work existed for him and in view of his unique and narrow
work qualifications, Padilla\'s failure to attempt to find a position
comparable to that of superintendent of train operations did not
constitute a failure to mitigate his damages." [Id]{.underline}. at 125;
[see]{.underline} [also]{.underline} [Fox v. City University of New
York]{.underline}, 1999 WL 33875 (S.D.N.Y. Jan. 26, 1999 ) at \*13-\*15.
In this case, there was no reasonable prospect that Bacalakis could have
found employment comparable to the job discriminatorily denied him
because the State defendants' regulations made such employment
unavailable to him.

The State Defendants insist that Bacalakis had a reasonable prospect of
returning to his position at Amboy, but abandoned the opportunity by
failing to file an administrative grievance with the State Education
Commissioner under N.Y. Education Law § 310. Apparently, it was not
enough that SED had already advised Bacalakis through the District that
it would adhere to its discriminatory regulation. Nor was it enough that
Bacalakis filed a charge of discrimination against SED with the EEOC,
which evoked a response from the agency's counsel reiterating that
Bacalakis was ineligible for employment as a school bus driver. Nor was
it enough that when the EEOC sought to obtain relief through
conciliation efforts after finding reasonable cause against the State
defendants, the State Defendants demurred, citing a gubernatorial
moratorium on regulatory changes that prevented such relief.

The State Defendants' argument that Bacalakis should have petitioned the
Education Commissioner under § 310 is little more than a poorly
disguised version of the exhaustion argument previously presented by
Amboy to, and rejected by, this Court:

> In arguing that Mr. Bacalakis should have pursued relief from the
> Department of Motor Vehicles and the Department of Education, Amboy is
> essentially asking that the aggrieved party in this context be
> required to lobby these state agencies to [change]{.underline} the
> law, as there is no indication that he could have been excused from
> its application, assuming that the law remained in effect. It is quite
> unlikely that this is the type of administrative exhaustion that
> Congress had in mind when it enacted the ADA. A primary purpose of the
> exhaustion requirement is to allow an administrative agency an
> opportunity to help the parties resolve their dispute without judicial
> intervention; filing a charge with the EEOC suffices to further this
> goal in this case.

[EEOC v. Amboy Bus Company]{.underline}, 96 CV 2935 (ARR) (August 19,
1998), at 6 n.6 (emphasis in original). Moreover, the Court found that
the provisions of § 310 did not even apply to Mr. Bacalakis's situation.
[Id]{.underline}. Refashioning Amboy's failed exhaustion argument as one
involving Mr. Bacalakis's purported failure to mitigate does not give it
any additional force. It should be rejected once more.

Finally, the State Defendants expend considerable time charging that Mr.
Bacalakis abandoned his efforts to be restored to his position at Amboy
by failing to apply to the Federal Highway Administration (FHWA) for a
waiver. State Deft's Mem. at 17-20. They are apparently referring to
DMV's response to an information request from the EEOC following Mr.
Bacalakis's filing of charges, in which DMV referred to an FHWA
"provision for waiving the physical/medical requirements for commercial
drivers with missing limbs who can pass an evaluation."
[See]{.underline} Cohen Aff., Exh.K at 2.[^6] According to the State
Defendants, by not seeking an FHWA waiver, Bacalakis failed to pursue
"an available avenue of relief that could have speeded his reinstatement
\[to Amboy\]." State Deft's Mem. at 20.

The State Defendants are simply wrong. The FHWA regulations specifically
provide that they [are]{.underline} [not]{.underline}
[applicable]{.underline} to school bus operations. 49 C.F.R. § 390.3(g)
provides that "\[u\]nless otherwise specifically provided, the rules in
this subchapter do not apply to (1) All school bus operations as defined
in § 390.5." 49 C.F.R. § 390.5 defines the term "school bus operation"
as "the use of a school bus to transport only school children and/or
school personnel from home to school and from school to home." Thus,
even had Mr. Bacalakis applied for and obtained an FHWA waiver, it would
not have advanced his ability to be restored to a school bus driver job
at Amboy or any other employer. DMV recognized as much, declining in its
letter to the EEOC to make any commitment that Mr. Bacalakis could be
restored to his employment as a school bus driver if he obtained the
waiver.

In sum, defendants' arguments that Mr. Bacalakis failed to mitigate are
insubstantial. Accordingly, he should be awarded back pay for the period
when defendants' discriminatory regulations, contractual provisions and
conduct prevented his employment.

[CONCLUSION]{.underline}

For the foregoing reasons and those set forth in the Memorandum of Law
in Support of the United States' Motion for Summary Judgment, the United
States respectfully submits that is motion for summary judgment should
be granted.

Dated: Brooklyn, New York

July 29, 1999

Respectfully submitted

LORETTA E. LYNCH

United States Attorney,

Eastern District of New York

One Pierrepont Plaza

Brooklyn, New York 11201

By: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

SANFORD M. COHEN (SC-6601)

Assistant U. S. Attorney

\(718\) 254-6249

[^1]: ^?^[Lavender-Cabellero]{.underline}, in contrast, simply
    misinterpreted the facts of [Puntolillo]{.underline}, erroneously
    asserting that the plaintiff-defendant relationship was primarily
    one of employment, rather than licensing. 458 F.Supp. at 215.

[^2]: ^?^One court, commenting on the effort of the
    [Lavender-Cabellero]{.underline} court to distinguish
    [Sibley]{.underline} on the ground that boards that issue licenses
    perform what amounts to a "policing function of public importance,"
    noted:

    > That is not at all a convincing rationale. If Title VII bars a
    > party from placing a discriminatory impediment between an
    > individual and his or her employment relationship with a third
    > party, it is certainly inconsistent to conclude that because the
    > function of a licensing board is to impose restrictions for the
    > public good it should not be held liable for doing so in a
    > discriminatory manner.

    [Morrison v. American Board of Psychiatry and Neurology,
    Inc.]{.underline}, 908 F.Supp. 582, 585 n.11 (N.D.Ill. 1996).

[^3]: ^?^Section 707(a) of Title VII provides:

    > Whenever the Attorney General has reasonable cause to believe that
    > any person or group of persons is engaged in a pattern or practice
    > of resistance to the full enjoyment of any of the rights secured
    > by this subchapter, and that the pattern or practice is of such a
    > nature and is intended to deny the full exercise of the rights
    > herein described, the Attorney General may bring a civil action in
    > the appropriate district court of the United States by filing with
    > it a complaint (1) signed by him (or in his absence the Acting
    > Attorney General), (2) setting forth facts pertaining to such
    > pattern or practice, and (3) requesting such relief, including an
    > application for a permanent or temporary injunction, restraining
    > order or other order against the person or persons responsible for
    > such pattern or practice, as he deems necessary to insure the full
    > enjoyment of the rights herein described.

    42 U.S.C. § 2000e-6(a).

[^4]: ^?^The contract is set forth at Exhibit 1 to the Deposition of
    Eileen McCarthy.

[^5]: ^?^Citing [NLRB v. Madison Courier, Inc.]{.underline}, 153
    U.S.App.D.C. 232, 245-246, 472 F.2d 1307, 1320-1321 (1972) (employee
    need not \"seek employment which is not consonant with his
    particular skills, background, and experience\" or \"which involves
    conditions that are substantially more onerous than his previous
    position\"); [Wonder Markets, Inc.]{.underline}, 236 N.L.R.B. 787,
    787 (1978) (offer of reinstatement ineffective when discharged
    employee offered a different job, though former position still
    existed), enf\'d, 598 F.2d 666, 676 (CA1 1979), supplemental
    decision, 249 N.L.R.B. 294 (1980); [Good Foods Manufacturing &
    Processing Corp.]{.underline}, 195 N.L.R.B. 418, 419 (1972) (offer
    of reinstatement ineffective because job offered had different
    conditions of employment and benefits), supplemental decision, 200
    N.L.R.B. 623 (1972), enf\'d, 492 F.2d 1302 (CA7 1974); [Harvey
    Carlton]{.underline}, 143 N.L.R.B. 295, 304 (1963) (offer of
    reinstatement ineffective because employees would return on
    probation).

[^6]: ^?^The FHWA waiver provision is set forth at 49 C.F.R. § 391.49.