FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

LAZY Y RANCH LTD, 

Plaintiff-Appellee,

v. No. 07-35315

TRACY BEHRENS; MARILYN D.C. No.

HOWARD; KEITH JOHNSON; JIM  CV-06-00340-MHW

RISCH; LAWRENCE WASDEN;

OPINION WINSTON WIGGINS; BEN YSURSA;

DOES 1-20; GEORGE BACON,

Defendants-Appellants. 

Appeal from the United States District Court

for the District of Idaho

Mikel H. Williams, Magistrate Judge, Presiding

Argued and Submitted

August 7, 2008—Seattle, Washington

Filed September 26, 2008

Before: Harry Pregerson, William C. Canby, Jr., and

Cynthia Holcomb Hall, Circuit Judges.

Opinion by Judge Hall

13783
COUNSEL

Clay R. Smith, Deputy Attorney General, Boise, Idaho, for

the defendants-appellants. 

Laurence J. Lucas, Boise, Idaho, for the plaintiff-appellee. 

LAZY Y RANCH LTD v. BEHRENS 13787
OPINION

HALL, Circuit Judge: 

I. INTRODUCTION

This case arises from Lazy Y Ranch’s attempt to lease

grazing lands from the State of Idaho. The leases were auctioned by the State and although Lazy Y was the high bidder,

the leases ultimately were awarded to other parties. Lazy Y

filed a complaint under 42 U.S.C. § 1983, alleging that various state officials violated the Equal Protection Clause when

they rejected its bids. In particular, Lazy Y alleged that the

officials discriminated against Lazy Y because it (1) has perceived ties to conservationists; and (2) is a Washington corporation that was attempting to enter the Idaho grazing market.

Defendants moved to dismiss the complaint under Federal

Rule of Civil Procedure 12(b)(6), contending that Lazy Y

failed to state an Equal Protection claim and, alternatively,

that they were entitled to qualified immunity. Defendants’

motion relied on various documents indicating they had articulated a legitimate reason for rejecting Lazy Y’s bids —

namely, that leasing to Lazy Y would involve increased

administrative costs because the lands were unfenced and cattle could wander onto adjoining property. The district court

struck most of Defendants’ extraneous documents and ultimately denied their motion to dismiss. This interlocutory

appeal followed, with Defendants relying on the collateral

order doctrine as a basis for appellate jurisdiction. 

As we explain below, Lazy Y has properly alleged that

Defendants violated its rights under the Equal Protection

Clause, and also that they violated clearly established law. We

therefore affirm. 

13788 LAZY Y RANCH LTD v. BEHRENS
II. FACTUAL AND PROCEDURAL BACKGROUND

A. The Complaint and Unchallenged Extraneous

Documents

The following facts come from allegations in Lazy Y’s first

amended complaint and the few extraneous documents that

the district court considered as part of Defendants’ motion to

dismiss. 

1. Overview of Idaho Endowment Lands 

The lands Lazy Y tried to lease are known as “endowment

lands.” Endowment lands are controlled by the Idaho State

Board of Land Commissioners, also called the “Land Board.”

Idaho Const., Art. IX § 7. The Land Board must “carefully

preserve[ ]” the endowment lands and manage them “in such

manner as will secure the maximum long-term financial

return to the institution to which [the land is] granted.” Id. § 8.

The Land Board has designated the lands at issue here to be

leased to private entities for the benefit of public schools. 

Under state law, leases on public school endowment lands

may not exceed 10 years (subject to exceptions not relevant

here). Idaho Code § 58-307(1). At the beginning of every calendar year, the Idaho Department of Lands (“IDL”) gives

public notice of all 10-year leases that are expiring on December 31 of that year and offers new 10-year leases to qualified

members of the public. When the IDL receives more than one

qualified application for the same lease, the IDL “shall . . .

auction off and lease the land to the applicant who will pay

the highest premium bid therefore.” Id. § 58-310(1). The

IDL’s auction is not necessarily final, however, as the Land

Board has the power to overturn it. See id. § 58-310(4). 

2. Lazy Y’s Bids 

In response to an IDL notice in early 2005, Lazy Y applied

for leases on nine grazing lands. With one exception, the prior

LAZY Y RANCH LTD v. BEHRENS 13789
lessees also applied for the new leases, as did some third parties. Given the competing applications, Defendant Tracy

Behrens, who was then the IDL Range Program Manager,

notified applicants that auctions would be held and that they

should submit management proposals addressing various

environmental concerns. Lazy Y obtained a “resource assessment” from the IDL to ensure that its proposals were consistent with IDL’s concerns, and timely submitted the proposals.

The proposals indicated that Lazy Y would improve environmental conditions on the land. 

Lazy Y alleges that it first experienced unfair treatment on

June 1, 2005, when Behrens told it that its management proposals did not adequately address IDL’s concerns and would

need to be modified. According to Lazy Y, the IDL had routinely leased endowment land to other parties without requiring more specific grazing management proposals than Lazy

Y’s. Lazy Y also alleges that the proposals of existing lessees

would have led to land damage that IDL sought to avoid and

that Lazy Y’s proposals addressed. Behrens singled out Lazy

Y’s proposals, Lazy Y says, because the IDL and Land Board

believed that Lazy Y was connected to conservationists who

have sought to improve state land management. 

After Lazy Y submitted new proposals, the parties further

disputed their adequacy, and Behrens at one point suggested

that Lazy Y might not be familiar with the applicable procedures because it was “not from Idaho.” Lazy Y responded that

its president was an Idaho resident and that it was fully

licensed to do business in Idaho. Eventually, IDL accepted the

proposals as complete. 

In August 2005, the IDL scheduled auctions for five of the

leases.1 Lazy Y was the high bidder for all five. According to

1No auction was scheduled for one lease because Lazy Y was the only

applicant. Two other leases were initially not auctioned because they had

“creditable improvements” such as fences or other infrastructure for which

the prior lessee could claim a financial interest. The ninth lease was never

set for auction despite a competing bidder. 

13790 LAZY Y RANCH LTD v. BEHRENS
Lazy Y, however, an agent for prior lessees named Wally

Butler orchestrated efforts to deprive Lazy Y of the leases by

appealing the auctions.2 The appeals allegedly were on the

verge of being denied by IDL staff, but before staff could act,

Defendant and IDL Director Winston Wiggins unilaterally

invalidated the auctions. Wiggins said he did so because —

as a result of an administrative error — IDL staff had inadvertently failed to circulate Lazy Y’s management proposals to

competing bidders before the auctions. Lazy Y alleges that

Wiggins’s justification was a pretext, again to cover discrimination based on Lazy Y’s perceived connection to conservationists and out of a desire to protect prior lessees from

competition.3

After a delay of several months, during which the prior lessees continued to use the grazing lands, the Land Board ultimately approved Wiggins’s decision to void the auctions. In

February 2006, the Land Board scheduled new auctions for

the five leases, as well as a sixth for which no auction had

previously been conducted because of disputes over improvements on the land. The six auctions were held in June 2006,

and Lazy Y was again the high bidder on each one. Lazy Y’s

winning bids totaled $5,825. 

This time, none of the competing bidders appealed the auction results. However, Wiggins put the leases on the Land

Board’s agenda for August 8, 2006. Six days before the Land

Board met, Behrens recommended that it deny Lazy Y’s

leases because taking them from the prior lessees would pre2Lazy Y’s complaint also included claims against Butler, but the district

court dismissed them without prejudice, and those claims are not at issue

here. 

3As evidence of the pretext, Lazy Y alleges that Wiggins voided the

auctions without providing any notice to Lazy Y, and also that the circulation requirement does not appear in any statute, rule or regulation. These

assertions are contradicted, however, by a June 2005 memo to Lazy Y that

included an informal IDL policy established in 2001 that competing applicants would receive each other’s management proposals before bidding.

LAZY Y RANCH LTD v. BEHRENS 13791
sent a “significant increase in administrative costs.” As stated

in an IDL staff memo provided on August 2, 2006, the

increased costs would result because the lands covered by the

leases “constitute only a portion of larger grazing allotments”

that were not divided by fences, and the previous lessees —

in each case the second highest bidders — had grazing rights

on the adjacent land. The memo cited increased costs associated with inspecting the sites to ensure that cattle from adjacent lands would not “drift” onto the unfenced endowment

lands. The memo estimated that Lazy Y’s plans would entail

increased administrative costs of approximately $45,000 over

the ten-year terms of the six leases. This purported increase

would dwarf the $675 total by which Lazy Y’s bids exceeded

the bids of the second highest bidders. 

The August 2, 2006 memo was the first time the IDL had

ever mentioned increased administrative costs associated with

new lessees. According to Lazy Y, this justification was pretextual, and suggested that Defendants should never have

opened the leases for public bidding since the only parties

who could avoid increased management costs were the prior

lessees. In attacking the assertion of increased administrative

costs, Lazy Y claims: 

(1) Defendants failed to establish their prior

administrative costs; 

(2) Defendants failed to establish that additional

inspections would really be required; 

(3) Defendants’ assertion of increased costs for

staff time was belied because they were not

planning to hire additional staff; 

(4) The vast majority of endowment lands leased

for grazing are isolated parcels within larger

grazing allotments, so Defendants’ management costs already reflect that fact; 

13792 LAZY Y RANCH LTD v. BEHRENS
(5) Other than in connection with past efforts by

conservationists to obtain state grazing leases,

Defendants have rarely if ever cited similar

concerns to deny a state lease; 

(6) The IDL regularly loses money on endowment

lands because its administrative costs outstrip

the modest revenues from leases; 

(7) The IDL rarely undertakes the supervision necessary to ensure that other grazing lessees comply with management requirements for land

preservation; 

(8) Defendants ignored the possibility that the

denial of Lazy Y’s lease would lead to litigation costs. 

Lazy Y also alleges that the “administrative costs” rationale

appeared after Behrens, Wiggins, and IDL Assistant Director

George Bacon spoke with representatives of the local livestock industry in meetings that excluded Lazy Y. 

In response to the eleventh-hour assertion of administrative

costs, Lazy Y wrote to Wiggins on August 3, 2006, offering

to “provide additional fencing and/or pay for additional

administrative costs incurred, up to $30,000 over the course

of the new ten-year leases, or such additional amount as may

be shown as reasonably necessary.” Notwithstanding Lazy

Y’s additional offer, the Land Board denied Lazy Y all six

leases at its August 2006 meeting, and instead awarded them

to the second highest bidders. Lazy Y alleges that the Board

members — Idaho Governor Jim Risch, Secretary of State

Ben Ysursa, Superintendent of Schools Marilyn Howard,

Attorney General Lawrence Wasden, and State Controller

Keith Johnson — summarily dismissed its offer to cover

increased costs, thus evidencing their discriminatory treatment of Lazy Y. 

LAZY Y RANCH LTD v. BEHRENS 13793
Lazy Y filed its complaint on August 28, 2006, and quickly

amended it to include similar allegations concerning denial of

a seventh lease in September 2006. The first amended complaint seeks damages and injunctive relief. 

B. Defendants’ Motion to Dismiss and Challenged

Extraneous Documents 

Defendants moved to dismiss the first amended complaint

under Rule 12(b)(6), arguing that Lazy Y failed to state an

Equal Protection claim and that they enjoyed qualified immunity from the claims for damages. In support of the motion,

Defendants submitted the June 2005 memo from Behrens to

Lazy Y, which included various IDL documents related to

grazing plan requirements. Defendants also submitted ten

other exhibits: (1) minutes and transcripts of the February

2006, August 2006, and September 2006 Land Board meetings (six total documents); (2) IDL memoranda submitted at

each of the three meetings (three total documents); and (3) an

August 3, 2006, letter from Lazy Y to Wiggins. 

Magistrate Judge Williams, acting as the district court with

the consent of the parties, considered (1) the June 2005 memo

from Behrens to Lazy Y, (2) the August 2006 IDL memorandum, and (3) the August 2006 letter from Lazy Y to Wiggins.

The relevant portions of these documents are referenced

above. 

On motion by Lazy Y, the district court struck Defendants’

other exhibits. The exhibits related to the February 2006

meeting indicate that Wiggins told the Land Board that the

IDL’s failure to circulate Lazy Y’s proposals was an administrative error. They also reflected Board members accepting

Wiggins’s explanation and agreeing that new auctions were a

fair solution. 

The stricken August 2006 meeting transcripts reflect

Defendant Bacon, then the IDL assistant director, telling the

13794 LAZY Y RANCH LTD v. BEHRENS
Land Board that the lands at issue lacked internal fences and

would be difficult to graze as separate units. Bacon also told

the Land Board that the second highest bidders leased or

owned the adjacent properties — arrangements that ostensibly

avoided the need for fencing. Superintendent Howard said she

believed that Lazy Y’s offer of compensation to cover

increased administrative costs should not be considered

because it was “beyond the . . . expectations at the time of

auction.” Controller Johnson said he agreed and questioned

whether even $30,000 would cover the costs of fencing off

the grazing lands. Governor Risch said he agreed with Johnson. The Board voted unanimously to deny the leases. 

To the same effect are the stricken materials concerning the

September 2006 Land Board meeting, where the Board

awarded the seventh lease to the second highest bidder. The

IDL recommended rejecting Lazy Y’s bid because of

increased administrative costs, which it represented were

approximately $14,000 over ten years. After counsel for Lazy

Y offered to reimburse IDL up to $25,000 or provide appropriate fencing, the Board expressed concern that this would be

inadequate, and voted unanimously to grant the leases to the

second highest bidders. 

Although the district court struck most of Defendants’

exhibits, it ruled that even considering all of them, Defendants’ motion to dismiss lacked merit. The motion was therefore denied. Defendants timely appealed. 

III. JURISDICTION

We begin by briefly addressing Lazy Y’s suggestion that

we lack appellate jurisdiction over this interlocutory appeal.

Lazy Y argues that (1) Defendants’ attacks on the order denying the motion to dismiss exceed the scope of the “collateral

order” doctrine upon which they allege jurisdiction, and (2)

the order granting Lazy Y’s motion to strike documents is

unappealable under any doctrine. We disagree. 

LAZY Y RANCH LTD v. BEHRENS 13795
[1] In general, a party is entitled only to a single appeal, to

be “deferred until final judgment has been entered.” See Digital Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 868

(1994). However, under the collateral order doctrine, a litigant

may appeal from a “narrow class of decisions that do not terminate the litigation, but must, in the interest of achieving a

healthy legal system, nonetheless be treated as final.” Id. at

867 (internal quotations and citations omitted). To be appealable under the collateral order doctrine, a district court decision must (1) be “conclusive,” (2) “resolve important

questions completely separate from the merits,” and (3) “render such important questions effectively unreviewable on

appeal from final judgment in the underlying action.” Id.

[2] Because qualified immunity is immunity from suit itself

and not merely a defense to liability, orders denying qualified

immunity may be immediately appealable under the collateral

order doctrine, including orders denying a motion to dismiss.

See Mitchell v. Forsyth, 472 U.S. 511, 526-27 (1985). Such

an order is reviewable to the extent that it raises an issue of

law. See id. at 528; Batzel v. Smith, 333 F.3d 1018, 1026 (9th

Cir. 2003). 

[3] Here, contrary to Lazy Y’s suggestion, we do not construe Defendants’ appeal to depend on “their version of the

facts.” Rather, Defendants argue that Lazy Y’s allegations of

pretext and animus are irrelevant under Equal Protection law,

because they have articulated legitimate reasons for rejecting

Lazy Y’s bids. In other words, Defendants argue that their

articulated purposes end the inquiry and mean that Lazy Y’s

claims of actual improper motives fail to establish an Equal

Protection violation. They also argue that Lazy Y brings

“class of one” claims that are either incognizable or not

clearly established in the context of public contracting. These

are contentions of law. See Armendariz v. Penman, 75 F.3d

1311, 1316-17 (9th Cir. 1996) (en banc). 

[4] Moreover, whether Defendants’ exhibits should have

been considered is essentially a legal question, and the order

13796 LAZY Y RANCH LTD v. BEHRENS
granting the motion to strike was simply part of the Rule

12(b)(6) analysis, as the district court resolved that motion

solely to establish the record for the motion to dismiss. See

Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994) (discussing when extraneous documents could be considered on a

motion to dismiss), overruled on other grounds by Galbraith

v. County of Santa Clara, 307 F.3d 1119 (9th Cir. 2002). We

see no reason to treat the order striking documents as separate

from the order denying the motion to dismiss. We conclude

that we have jurisdiction to review both orders. 

IV. STANDARD OF REVIEW

We review de novo the district court’s denial of a motion

to dismiss on qualified immunity grounds. Jensen v. City of

Oxnard, 145 F.3d 1078, 1082 (9th Cir. 1998). To survive a

motion to dismiss for failure to state a claim, the plaintiff

must allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 127 S.Ct. 1955,

1974 (2007); see Fed. R. Civ. P. 12(b)(6). In general, the

inquiry is limited to the allegations in the complaint, which

are accepted as true and construed in the light most favorable

to the plaintiff. Sprewell v. Golden State Warriors, 266 F.3d

979, 988 (9th Cir. 2001). However, we need not accept as true

allegations contradicting documents that are referenced in the

complaint or that are properly subject to judicial notice. See

id.; Outdoor Media Group, Inc. v. City of Beaumont, 506 F.3d

895, 899-900 (9th Cir. 2007).

V. ANALYSIS

A. The Motion to Strike

Defendants contend the district court abused its discretion

in striking their exhibits because the exhibits were either referenced in the complaint, or judicially noticeable. Defendants

appear correct, see United States v. Ritchie, 342 F.3d 903, 908

(9th Cir. 2003); Branch, 14 F.3d at 453-54, particularly

LAZY Y RANCH LTD v. BEHRENS 13797
because they do not offer the extraneous documents for their

truth, but to show their articulated rationales for denying Lazy

Y the leases. However, we need not decide the issue because

we conclude, as the district court did, that Defendants’ motion

to dismiss lacks merit even if each extraneous document is

considered. 

B. The Motion to Dismiss 

[5] The Supreme Court has recently reiterated the familiar

two-part analysis for claims of qualified immunity:

In resolving questions of qualified immunity, courts

are required to resolve a threshold question: Taken

in the light most favorable to the party asserting the

injury, do the facts alleged show the officer’s conduct violated a constitutional right? This must be the

initial inquiry. If, and only if, the court finds a violation of a constitutional right, the next, sequential step

is to ask whether the right was clearly established in

light of the specific context of the case. 

Scott v. Harris, 127 S.Ct. 1769, 1774 (2007) (citations, quotation marks, and alteration omitted). We consider each inquiry

in turn. 

1. Equal Protection Violation

[6] “The purpose of the equal protection clause of the Fourteenth Amendment is to secure every person within the

State’s jurisdiction against intentional and arbitrary discrimination, whether occasioned by express terms of a statute or by

its improper execution through duly constituted agents.” Village of Willowbrook v. Olech, 528 U.S. 562, 564 (2000) (per

curiam) (citations and quotation marks omitted). In cases like

this one involving rational basis review, a state actor’s classification comports with the Equal Protection Clause so long as

it is “rationally related to a legitimate state interest.” E.g.,

13798 LAZY Y RANCH LTD v. BEHRENS
Pennell v. City of San Jose, 485 U.S. 1, 14 (1988). Under this

standard, a “State may not rely on a classification whose relationship to an asserted goal is so attenuated as to render the

distinction arbitrary or irrational.” City of Cleburne v. Cleburne Living Center, 473 U.S. 432, 446 (1985). 

[7] “The first step in equal protection analysis is to identify

the [defendants’] classification of groups.” Country Classic

Dairies, Inc. v. State of Montana, Dep’t of Commerce Milk

Control Bureau, 847 F.2d 593, 596 (9th Cir. 1988). “To

accomplish this, a plaintiff can show that the law is applied

in a discriminatory manner or imposes different burdens on

different classes of people.” Freeman v. City of Santa Ana, 68

F.3d 1180, 1187 (9th Cir. 1995). Here, the substance of Lazy

Y’s complaint is that Defendants made the bidding process

more cumbersome and ultimately denied its leases because

they discriminated on the basis of whether a bidder was a conservationist (or a perceived conservationist) and new to the

Idaho grazing market. Lazy Y also alleges that Defendants

discriminated in favor of the prior lessees. 

In support of their motion to dismiss, Defendants argue that

Lazy Y fails to state an Equal Protection claim because (1)

they have offered a legitimate purpose for denying the leases

to which their actions rationally relate, and (2) Lazy Y’s

claims amount to a “class of one” theory that is not cognizable in the context of competitive public contracting. Defendants are incorrect. 

a. Sufficiency of a Proffered Rational Basis, Even if

Pretextual

(1). Defendants Offer No Reason For Treating

Conservationists Differently From Other Bidders

[8] The first flaw in Defendants’ argument is that they have

only put forth a rationale for denying Lazy Y’s leases; they

have not offered a rational basis for classifying based on

LAZY Y RANCH LTD v. BEHRENS 13799
whether a lease applicant is a conservationist, as Lazy Y

alleges. As Defendants note, the Supreme Court has often

indicated that rational basis review should not inquire into the

actual purpose of the challenged classification. See FCC v.

Beach Communications, Inc., 508 U.S. 307, 315 (1993);

United States R.R. Retirement Bd. v. Fritz, 449 U.S. 166, 179

(1980)); see also Heller v. Doe, 509 U.S. 312, 321 (1993) (a

classification “must be upheld against equal protection challenge if there is any reasonably conceivable state of facts that

could provide a rational basis for the classification” (citation

and quotation marks omitted)); Minnesota v. Clover Leaf

Creamery Co., 449 U.S. 456, 463-64 (1981) (rejecting argument that state had to demonstrate an empirical basis for its

classification).4 However, these cases do not require us to

accept Defendants’ characterization of what classification

they made. In Beach Communications, for example, there was

no dispute over what line Congress had drawn: it drew “a distinction between [cable television] facilities that serve separately owned and managed buildings and those that serve one

or more buildings under common ownership or management,”

with only the latter being exempt from regulation. 508 U.S.

at 309. The question was whether this distinction survived

rational basis review. See id. In analyzing whether it did, the

Court noted that “because we never require a legislature to

articulate its reasons for enacting a statute, it is entirely irrelevant for constitutional purposes whether the conceived reason

for the challenged distinction actually motivated the legislature.” Id. at 315 (emphasis added). 

[9] Here, by contrast, the nature of the classification — i.e.,

what line Defendants drew — is at the center of the dispute.

4Lazy Y argues that the Supreme Court cases cited above are distinguishable because they involve legislative rather than executive decisionmaking. However, the Equal Protection Clause applies equally to executive and legislative action. See Nordlinger v. Hahn, 505 U.S. 1, 16 n.8

(1992); see also Immigration Assistance Project of L.A. County Fed’n of

Labor v. INS, 306 F.3d 842, 872 (9th Cir. 2002) (rejecting argument that

distinguished executive action from legislative action). 

13800 LAZY Y RANCH LTD v. BEHRENS
Lazy Y alleges that Defendants classified on the basis of

whether the bidder was associated with conservationists, and

pleads numerous facts that, if proven, would tend to establish

this theory.5 Though Defendants assert that they classified

only on the basis of the costs associated with prospective lessors’ management plans, nothing in the cases they cite

requires us to accept their explanation. Similarly, while

administrative costs might be a valid reason to deny a bidder

a lease, it simply does not offer a basis for treating conservationists differently from other bidders. 

The Supreme Court’s opinion in Olech illustrates this point.

In Olech, the plaintiff alleged that her town had demanded a

33-foot easement in exchange for access to the water supply,

while the easements asked of others were only 15 feet. 528

U.S. at 563. The Court did not ask whether there was a rational basis for the village asking for a 33-foot easement from

one of its citizens. See id. at 565. Rather, the Court noted the

plaintiff’s allegations that there was no rational reason why

she had to provide a larger easement than her neighbors’. The

allegation of irrational differential treatment properly stated

an Equal Protection claim. See id.

[10] Similar to Olech, the question here is not simply

whether administrative costs were a rational reason for denying Lazy Y’s bid. In short, Lazy Y’s claims suggest that

5For example, Lazy Y alleges that “[o]ther than in connection with past

efforts by conservationists to obtain state grazing leases . . . Defendants

have rarely if ever cited [increased administrative costs] to deny other parties a lease.” Also pertinent are Lazy Y’s claims that Defendants (1)

required more specific grazing proposals for Lazy Y than it did for competing bidders; (2) inexplicably failed to circulate Lazy Y’s proposals to

other bidders in violation of their procedures; (3) regularly loses money

on endowment lands because its administrative costs outstrip the modest

revenues from leases; (4) failed to notify Lazy Y that the parcels were not

manageable units before bidding, contrary to a requirement in its operations manual; and (5) delayed disclosure of the costs concern until just six

days before the August 2006 Land Board meeting. 

LAZY Y RANCH LTD v. BEHRENS 13801
administrative costs only matter in some cases — i.e., when

the high bidder is a conservationist. The real question is

whether there is a rational basis for this distinction. On this

record, there is not. 

(2). Supreme Court and Circuit Law Allows Some

Inquiry Into the Rationale for the Classification

[11] Moreover, even where the nature of the classification

is clear, subsequent case law has not rigidly interpreted the

cases Defendants cite. The Supreme Court has cautioned that

“even the standard of rationality . . . must find some footing

in the realities of the subject addressed by the legislation.”

Heller, 509 U.S. at 321; accord Immigration Assistance Project, 306 F.3d at 872 (quoting Heller). Consistent with this

admonition, our circuit has allowed plaintiffs to rebut the facts

underlying defendants’ asserted rationale for a classification,

to show that the challenged classification could not reasonably be viewed to further the asserted purpose. For example,

in Lockary v. Kayfetz, homeowners challenged a city’s moratorium on new water hookups, which the city claimed was

needed due to a water shortage. 917 F.2d 1150, 1155-56 (9th

Cir. 1990). Because the plaintiffs introduced evidence that

there was no water shortage at all, their Equal Protection

claim survived summary judgment even under rational basis

review. Id. Similarly, in Parks v. Watson, a developer claimed

a city violated its Equal Protection rights when it required the

developer to relinquish a well before it could build. 716 F.2d

646, 654-55 (9th Cir. 1983). The city asserted three reasons

for the demand: “(1) [the developer]’s noncompliance with

the City’s request that it submit conceptual drawings of the

[project], (2) a concern over the problem of public access, and

(3) a desire to acquire [the developer]’s geothermal wells for

the City’s proposed geothermal heating district.” Id. at 654.

We found factual disputes as to whether the developer failed

to submit drawings and whether there was actually a concern

over access, and found that a bare desire to take the developer’s wells was not a legitimate interest. Id. at 654-55. 

13802 LAZY Y RANCH LTD v. BEHRENS
[12] Additionally, we have stated that “in an equal protection claim based on selective enforcement of the law, a plaintiff can show that a defendant’s alleged rational basis for his

acts is a pretext for an impermissible motive.” Engquist v. Or.

Dep’t of Agric., 478 F.3d 985, 993 (9th Cir. 2007) (emphasis

added); (citing Squaw Valley Dev. Co. v. Goldberg, 375 F.3d

936, 944 (9th Cir. 2004)). 

[13] Here, Lazy Y attacks the premise that increased

administrative costs could rationally result from its leases.

Among other things, Lazy Y claims that the IDL “rarely

undertakes the supervision necessary to ensure that other

grazing lessees comply with management requirements for

land preservation.” Read in the light most favorable to Lazy

Y, this allegation suggests that Defendants may never have

intended to police the grazing lands at all, and therefore

would never actually have incurred increased costs if Lazy Y

was the lessee.6 And some of Lazy Y’s claims amount to allegations of “selective enforcement,” such as the claim that

Defendants required more specific grazing proposals from

Lazy Y than they did for other parties. 

[14] In sum, we reject Defendants’ contention that their

administrative costs rationale necessarily defeats Lazy Y’s

claim. Lazy Y alleges that administrative costs have been

raised only to deny leases to conservationists. It also alleges

6Lazy Y’s other attacks on the administrative costs rationale are less

availing. The allegation that no costs would result simply because Defendants had not proposed to hire additional staff ignores the possibility that

existing staff would be diverted from other projects and would incur

increased travel costs. And it is irrelevant that denying Lazy Y’s leases

might have led to litigation costs. Moreover, we agree that Lazy Y’s offers

to cover additional administrative costs do not mean it was irrational to

reject its bids. The August 2006 memo estimated increased costs of

$45,000 if the leases went to Lazy Y. Lazy Y offered to pay $30,000 and

whatever other costs were shown to be “reasonably necessary.” Defendants could rationally have wished to avoid debates about what costs were

“reasonably necessary.” 

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that Defendants would not actually have incurred additional

costs at all, and raised them only out of bias against conservationists and market newcomers. These allegations suffice to

state an Equal Protection claim even under rational basis

review. See Lockary, 917 F.2d at 1155-56. 

b. Class of One 

In addition to relying on their administrative costs rationale, Defendants also argue that Lazy Y has asserted a “class

of one” claim, which should be deemed incognizable in the

context of competitive bidding for public leases. We disagree

with Defendants’ characterization of Lazy Y’s claims. 

[15] The “class of one” theory was recognized in Olech,

and is unusual because the plaintiff in a “class of one” case

does not allege that the defendants discriminate against a

group with whom she shares characteristics, but rather that

the defendants simply harbor animus against her in particular

and therefore treated her arbitrarily. See N. Pacifica LLC v.

City of Pacifica, 526 F.3d 478, 486 (9th Cir. 2008) (“When

an equal protection claim is premised on unique treatment

rather than on a classification, the Supreme Court has

described it as a ‘class of one’ claim.” (citing Olech, 528 U.S.

at 564)). Such circumstances state an Equal Protection claim

because, if a state actor classifies irrationally, the size of the

group affected is constitutionally irrelevant. Olech, 528 U.S.

at 564. 

As Defendants recognize, this court has held that plaintiffs

cannot bring “class of one” cases challenging public employment decisions, because: (1) “the government as employer has

broader powers than the government as regulator, [so] the

scope of judicial review is correspondingly restricted; (2) “the

need for judicial review under equal protection ‘is especially

thin’ given the number of other legal protections” for public

employees; (3) and applying equal protection “to forbid arbitrary or malicious firings . . . would completely invalidate the

13804 LAZY Y RANCH LTD v. BEHRENS
practice of public at-will employment.” Engquist, 478 F.3d at

994-95. The Supreme Court affirmed this ruling and adopted

this rationale. Engquist v. Or. Dep’t of Agriculture, 128 S.Ct.

2146, 2151-57 (2008). Analogizing the public bidding context

to the public employment context addressed in Engquist,

Defendants ask us to hold that the “class of one” theory does

not apply. 

[16] The problem with this argument, however, is that Lazy

Y does not rely on a class of one theory. Lazy Y alleges

repeatedly that Defendants treated it differently based on its

perceived association with conservationists and because it

was a newcomer to Idaho grazing markets. In other words,

Lazy Y’s claims are not premised on “unique treatment” but

on “a classification;” therefore, we need not decide whether

the class of one theory would be cognizable in this context.

See N. Pacifica, 526 F.3d at 486. 

Accordingly, Plaintiffs have stated an Equal Protection

claim. 

2. Clearly Established Right

[17] The second inquiry in a qualified immunity case is

whether the constitutional violation the plaintiff has alleged is

clearly established. See Scott, 127 S.Ct. at 1774. Here, Defendants argue Lazy Y has not alleged such a violation, but they

rely on the contention that Lazy Y brings a “class of one”

claim. As we explained above, we disagree with this characterization. We view the complaint as relying on the principle

that government actors may not draw irrational or arbitrary

classifications. This principle is clearly established, see, e.g.,

Hydrick v. Hunter, 500 F.3d 978, 999 (9th Cir. 2007), so

Defendants are not entitled to qualified immunity. 

VI. CONCLUSION

The district court’s denial of Defendants’ Rule 12(b)(6)

motion is AFFIRMED and the matter is REMANDED for

further proceedings. 

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