UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

MARYLAND MINORITY CONTRACTORS

ASSOCIATION, INCORPORATED; PRINCE

GEORGE'S COUNTY CONTRACTORS AND

BUSINESS ASSOCIATION,

INCORPORATED; COALITION FOR BLACK

ECONOMIC DEVELOPMENT,

INCORPORATED; HEZEKIAH DANIELS,

d/b/a Hezekiah's Construction and

Welding Company; RICHARD J.

COLON, d/b/a Mace Electric

Company, Incorporated; ROOSEVELT

LABOO, d/b/a DSI Construction

Company; RALEIGH NANTON, d/b/a

New World Steel Erectors; CARLTON

No. 96-1203

CRAIG, d/b/a Craig's Trucking

Company; JAMES JUSTICE, d/b/a

Justice Trucking Company; PLES

JONES, d/b/a P and J Contractors,

Incorporated,

Plaintiffs-Appellees,

v.

HAL KASSOFF; CHARLES OLSEN;

JAMES KELLY; STEVE ZENTZ,

Individually and Personally,

Defendants-Appellants,

and
FEDERICO F. PENA, SECRETARY,

DEPARTMENT OF TRANSPORTATION;

EDWARD MORRIS, Director of Civil

Rights; MARYLAND DEPARTMENT OF

TRANSPORTATION (MDOT);

MARYLAND STATE HIGHWAY

ADMINISTRATION (MSHA);

A. PORTER BARROWS, Individually

and Personally; DAVE GENDELL,

Individually and Personally;

O. JAMES LIGHTHIZER, Individually

and Personally,

Defendants.

Appeal from the United States District Court

for the District of Maryland, at Baltimore.

Alexander Williams, Jr., District Judge.

(CA-93-2761-AW)

Submitted: June 17, 1997

Decided: June 15, 1998

Before WILKINS, NIEMEYER, and MOTZ, Circuit Judges.

_________________________________________________________________

Vacated and remanded by unpublished per curiam opinion.

_________________________________________________________________

COUNSEL

J. Joseph Curran, Jr., Attorney General of Maryland, Evelyn O. Cannon, Assistant Attorney General, Omar V. Melehy, Assistant Attorney

General, STATE HIGHWAY ADMINISTRATION, Baltimore,

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Maryland, for Appellants. John H. Rhines, STANCIL & RHINES,

Baltimore, Maryland, for Appellees.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See

Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

Maryland Minority Contractors Association and others brought this

action alleging discrimination against African Americans and Hispanic Americans in the administration of a federal program that provides funds for the construction of highways and mass transit

facilities. The program is designed to support "the fullest possible participation of firms owned and controlled by minorities and women . . .

in Department of Transportation programs." 49 C.F.R. § 23.1(a)

(1997). The Plaintiffs primarily alleged that federal and Maryland

state agencies and employees involved with the award and oversight

of federal highway construction contracts in Maryland intentionally

discriminated against businesses controlled by African Americans and

Hispanic Americans in favor of those controlled by white women.

The district court dismissed all claims save those under 42 U.S.C.

§§ 1981, 1983 (1994) against all Defendants except four individual

state Defendants, Hal Kassoff, Charles Olsen, James Kelly, and Steve

Zentz. Those state Defendants moved to dismiss, claiming, among

other things, that they were entitled to qualified immunity.

In its final order, the district court did not mention qualified immunity. The district court's silence on the qualified immunity issue "subjected [the state Defendants] to further pretrial procedures, and so

effectively denied [them] qualified immunity." Jenkins v. Medford,

119 F.3d 1156, 1159 (4th Cir. 1997). We therefore have jurisdiction

to consider this appeal, in which the state Defendants challenge the

denial of qualified immunity. See id. Because we conclude that the

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state Defendants were entitled to qualified immunity, we vacate the

decision of the district court.

I

This action concerns the federally authorized set-aside program

implemented by the State of Maryland. The program originated after

Congress enacted the Surface Transportation Assistance Act of 1982

(Surface Transportation Act), Pub. L. No. 97-424, 96 Stat. 2097

(1983). Section 105(f) of the Surface Transportation Act provides that

ten percent of the amounts authorized to be appropriated thereunder

are to "be expended with small business concerns owned and controlled by socially and economically disadvantaged individuals." 96

Stat. at 2100. Black Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, and certain other individuals are presumed to be socially and economically disadvantaged. See 15 U.S.C.

§ 637(d)(3)(C) (1994).

Congress subsequently enacted the Surface Transportation and

Uniform Relocation Assistance Act of 1987 (Surface Relocation Act),

Pub. L. No. 100-17, 101 Stat. 132. That statute was designed to

achieve certain minority business participation goals primarily

through the use of set-asides for qualified subcontractors. See S. Rep.

No. 4, 100th Cong., 1st Sess. 11-12 (1987), reprinted in 1987

U.S.C.C.A.N. 66, 76. Section 106(c) of the Surface Relocation Act

established a ten percent minority business goal, see 101 Stat. at 145,

similar to that in the Surface Transportation Act, and added women

to the list of those presumed to be socially and economically disadvantaged. See id.

States, such as Maryland, that receive federal funds under the Surface Transportation Act and Surface Relocation Act must comply

with federal regulations concerning minority business participation in

highway and mass transit construction contracts. A state recipient

must establish annual overall minority business enterprise (MBE) participation goals on projects receiving federal funds, see 49 C.F.R.

§ 23.64 (1997), and must ensure that at least ten percent of money

expended on federally assisted projects goes to such enterprises,

absent a waiver by the Secretary of Transportation. See 49 C.F.R.

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§ 23.61(a) (1997). The record reveals that Maryland always has met

or exceeded the ten percent goal.

II

In this appeal, the state Defendants challenge the district court's

denial of qualified immunity. "Government officials performing discretionary functions are entitled to qualified immunity from liability

for civil damages to the extent that `their conduct does not violate

clearly established statutory or constitutional rights of which a reasonable person would have known.'" Rish v. Johnson, 131 F.3d 1092,

1095 (4th Cir. 1997) (quoting Harlow v. Fitzgerald, 457 U.S. 800,

818 (1982)). To determine whether an official is entitled to qualified

immunity, we first "identify the specific constitutional right allegedly

violated, then . . . inquire whether at the time of the alleged violation

it was clearly established, [and finally we] inquire whether a reasonable person in the official's position would have known that his conduct would violate that right." Collinson v. Gott, 895 F.2d 994, 998

(4th Cir. 1990) (Phillips, J., concurring).

The specific rights allegedly violated--those to be free from purposeful racial discrimination in the making and enforcing of contracts

(42 U.S.C. § 1981) and from intentional violation, under color of state

law, of the right to equal protection under the law (42 U.S.C. § 1983)

--are clearly established. See General Bldg. Contractors Ass'n v.

Pennsylvania, 458 U.S. 375, 391 (1982) (§ 1981); Personnel Administrator v. Feeney, 442 U.S. 256, 281 (1979) (§ 1983). It also is well

established that the racially discriminatory impact of an official policy, standing alone, rarely renders that policy unconstitutional. Rather,

"the decisionmaker . . . must have selected or reaffirmed a particular

course of action at least in part `because of,' not merely `in spite of,'

its adverse effects upon an identifiable group." Feeney, 442 U.S. at

279.

Here, there is no evidence that the statutes or regulations were

drafted so as to have an adverse impact on African Americans or Hispanic Americans. Nor is there any evidence that the state Defendants

acted with discriminatory intent when administering the federal program in Maryland.

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The Plaintiffs chiefly complain that the individual state Defendants

awarded a significantly higher number of contracts to businesses

owned by white women than to businesses owned by African Americans and Hispanic Americans. Even if this is true, no reasonable person in the state Defendants' position would have known that such

action violated any constitutional right. The MBE program has no

specific quota or goal for participation by each type of disadvantaged

business. See 49 C.F.R. § 23.62 (1997); Gauvin v. Trombatore, 682

F. Supp. 1067, 1072 (N.D. Cal. 1988). There is no requirement that

recipients of federal funds insure that each MBE group receives an

equal share of contracts. And there is no showing that the state Defendants purposefully discriminated against any group in awarding contracts that counted towards the ten percent goal.

The Plaintiffs also contend that other practices violated their contractual and equal protection rights. Contrary to their assertions, however, there is no requirement that the state include a minimum ten

percent MBE participation clause in each individual construction contract valued at more than $100,000. State officials are permitted under

the regulations to waive or reduce the ten percent goal in accordance

with certain procedures, and the Plaintiffs made no showing that any

such reductions were intentionally targeted at African Americans or

Hispanic Americans.

Further, there is not, as the Plaintiffs claim, a requirement that state

transportation officials annually revise and submit to federal officials

an MBE program. The pertinent regulation provides that once a state

program receives federal approval, applicants "are not required to

resubmit the program or to produce a new program for future applications, as long as all requirements for approval continue to be met and

implementation of the program is achieving compliance." 29 C.F.R.

§ 23.41 (1997).

Finally, the Plaintiffs assert that the state Defendants improperly

allowed MBE credit for large supply items and allowed prime contractors to falsify documents to demonstrate compliance with their

MBE goals. These allegations, even if proven, do not state a claim for

intentional discrimination. Improper crediting is not specifically targeted at African Americans or Hispanic Americans, and the Plaintiffs

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do not allege any reason why these groups would be affected by the

alleged policies any more than any other MBE group.

III

We conclude that reasonable persons in the state Defendants' position would not have known that their actions violated any clearly

established constitutional rights of the Plaintiffs. Accordingly, the

state Defendants are entitled to qualified immunity. We vacate the

decision of the district court and remand with instructions to dismiss

the remaining counts against the state Defendants.

We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before the court and

argument would not aid the decisional process.

VACATED AND REMANDED

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