Opinion ID: 673802
Heading Depth: 1
Heading Rank: 2

Heading: The Fair Employment Council

Text: 32 The other plaintiff in this action, the Fair Employment Council of Greater Washington, fares better under our analysis. The Council does not claim standing on behalf of any members; in fact, it is not a membership organization. Cf. Hunt v. Washington State Apple Advertising Comm'n, 432 U.S. 333, 343, 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1977). It claims instead that BMC's allegedly discriminatory actions have caused it injury in its own right. 33 We agree that the Council has alleged injury in fact sufficient to satisfy the requirements of Article III. And, though the Council is suing BMC over alleged violations of statutory rights enjoyed by third parties, we conclude that Congress did give the Council a cause of action under Title VII. We also conclude, however, that the Council has no cause of action under Sec. 1981.
34 Like the fair-housing organization that was one of the plaintiffs in Havens, the Council has a broad goal of promoting equal opportunity independent of merely seeking more enforcement of the civil rights laws. Second Amended Complaint p 5. Its testing program is but one means toward this goal; the Council also conducts community outreach and public education, counseling, and research projects. Declaration of Charles W. Jackson p 8 (Sept. 18, 1992). The complaint alleges that BMC's discriminatory actions have interfered with these efforts and programs and have also required the Council to expend resources to counteract BMC's alleged discrimination. Second Amended Complaint pp 45, 58, 60. 35 These allegations closely track the claims that the Supreme Court found sufficient in Havens. See Havens, 455 U.S. at 379, 102 S.Ct. at 1124-25. Fairly read, they indicate that BMC's alleged pattern of discrimination--evidenced by the alleged treatment of the testers--has made the Council's overall task more difficult. Discrimination by BMC, for instance, might increase the number of people in need of counseling; similarly, to the extent that BMC's actions have made it harder for minorities to find jobs in greater Washington, they may have reduced the effectiveness of any given level of outreach efforts. If discriminatory actions taken by BMC have perceptibly impaired the Council's programs, there can be no question that the organization has suffered injury in fact. Id. 36 In reaching this conclusion, however, we explicitly reject the Council's suggestion that the mere expense of testing BMC constitutes injury in fact fairly traceable to BMC's conduct. The diversion of resources to testing might well harm the Council's other programs, for money spent on testing is money that is not spent on other things. But this particular harm is self-inflicted; it results not from any actions taken by BMC, but rather from the Council's own budgetary choices. Indeed, it is not really a harm at all; assuming that BMC's actions did not have any other effect on the Council's programs independent of its efforts to increase legal pressure on possible open housing violators, the Council and its programs would have been totally unaffected if it had simply refrained from making the re-allocation. One can hardly say that BMC has injured the Council merely because the Council has decided that its money would be better spent by testing BMC than by counseling or researching. 3 37 We disagree with the Seventh Circuit that Havens would support such a purely self-referential injury. In Village of Bellwood v. Dwivedi, 895 F.2d 1521 (7th Cir.1990), the court concluded that even when a fair-housing organization's other activities had not been impaired by the defendant's discriminatory practices, the only injury which need be shown ... is deflection of the agency's time and money from counseling to legal efforts directed against discrimination. Id. at 1526. By this logic, the time and money that plaintiffs spend in bringing suit against a defendant would itself constitute a sufficient injury in fact, a circular position that would effectively abolish the requirement altogether. Indeed, an organization devoted exclusively to advancing more rigorous enforcement of selected laws could secure standing simply by showing that one alleged illegality had deflected it from pursuit of another, contrary to such decisions as Schlesinger v. Reservists Committee to Stop the War, 418 U.S. 208, 94 S.Ct. 2925, 41 L.Ed.2d 706 (1974). Havens did not so hold. The Court there did not base standing on the diversion of resources from one program to another, but rather on the alleged injury that the defendants' actions themselves had inflicted upon the organization's programs. To be sure, the Court did mention the drain on the organization's resources. Yet this drain apparently sprang from the organization's need to counteract the defendants' assertedly illegal practices, and thus was simply another manifestation of the injury that those practices had inflicted upon the organization's noneconomic interest in encouraging open housing, an interest that is quite intelligible apart from the allied efforts at increasing legal pressure on civil-rights violators. See Havens, 455 U.S. at 379 & n. 20, 102 S.Ct. at 1124 & n. 20; cf. Spann v. Colonial Village, 899 F.2d 24, 27-29 (D.C.Cir.1990) (finding standing because in order to offset defendant's allegedly discriminatory advertisements, plaintiff organization had to spend more on its educational and counseling efforts). 38 A corollary of our conclusion is that the Council's standing stems from BMC's actions against bona fide employment candidates, not from BMC's actions against the testers. The Council has adequately alleged that BMC has a pattern or practice of discrimination, and its treatment of the testers may be some evidence of such a pattern. Any harm to the Council's programs, however, flows from BMC's refusal to refer genuine job-seekers for employment. As this case proceeds, the Council will have to provide support for its claim that BMC's alleged discrimination has perceptibly impaired its programs.
39 Though the Council has adequately alleged an injury in fact sufficient to meet the requirements of Article III, this does not necessarily mean that Congress has conferred a cause of action upon it. BMC has done nothing to impair the Council's own right to make contracts, nor is the Council even capable of seeking an employment referral. Instead, the Council's asserted injuries flow from BMC's alleged violations of other people's rights under Sec. 1981 and Title VII. This fact triggers concerns about an aspect of the prudential limits on standing: ordinarily, a plaintiff must assert his own legal interests, rather than those of third parties. Gladstone, Realtors, 441 U.S. at 100, 99 S.Ct. at 1608. 40 To phrase the principle this way, however, is to beg the question. If Congress has given the Council a cause of action to redress the injuries that it is suffering as a result of BMC's alleged discrimination against candidates for referrals, then the Council is indeed suing to protect its own legal interests. Cf., e.g., Smith v. City of Cleveland Heights, 760 F.2d 720, 724 (6th Cir.1985). A more precise statement of the principle, then, is that a statute ordinarily will not be interpreted to confer causes of action upon people whose only injuries derive from the violation of others' rights under the statute. 41 When the prudential limits on standing to raise statutory claims are understood in this way--as a set of presumptions that courts use in determining whether the statutes in question confer a cause of action upon the plaintiff, see, e.g., Warth v. Seldin, 422 U.S. 490, 500-01, 95 S.Ct. 2197, 2205-07, 45 L.Ed.2d 343 (1975); Hazardous Waste Treatment Council v. United States Environmental Protection Agency, 861 F.2d 277, 283 (D.C.Cir.1988)--the prudential label seems a misnomer. These prudential rules are simply canons of statutory interpretation, and Congress is free to override the normal presumptions. In Havens, for instance, the Supreme Court noted that Congress intended standing to sue under Sec. 812 of the Fair Housing Act to extend to the full reach permitted by the Constitution, and concluded that the courts accordingly lack the authority to create prudential barriers to standing in suits brought under that section. Havens, 455 U.S. at 372, 102 S.Ct. at 1120; accord Warth, 422 U.S. at 501, 95 S.Ct. at 2206-07. Statutes of this sort confer a cause of action upon everyone who meets the Article III requirements--that is, anyone genuinely injured by conduct that violates someone's ... rights under the statute. Gladstone, Realtors, 441 U.S. at 103 n. 9, 99 S.Ct. at 1609 n. 9. 42 Our case law establishes that Title VII is such a statute. Congress specifically permitted any person claiming to be aggrieved by an unlawful employment practice to file suit (after exhausting certain other potential avenues of relief). See 42 U.S.C. Sec. 2000e-5(f)(1). This language, we have held, opens the courts to anyone who satisfies the constitutional requirements. Gray v. Greyhound Lines, 545 F.2d 169, 176 (D.C.Cir.1976); see also Trafficante v. Metropolitan Life Ins. Co., 409 U.S. 205, 209, 93 S.Ct. 364, 366-67, 34 L.Ed.2d 415 (1972) (citing with approval the Third Circuit's decision to the same effect). Accordingly, if the Council can back up its allegations of Article III standing with actual proof, it has a cause of action under Title VII. 43 Section 1981 is a different matter. A footnote in Gray indicated that there too standing extended to the full extent permissible under Article III. Gray, 545 F.2d at 176 n. 18. This conclusion, however, rested on an unsustainable assumption that the Supreme Court, in citing a snippet of Title VII's legislative history to the effect that the remedies available under Title VII were co-extensive with an individual's right to sue under Sec. 1981, meant that Congress had identically resolved prudential standing issues under the two statutes. See Johnson v. Railway Express Agency, 421 U.S. 454, 459, 95 S.Ct. 1716, 1719-20, 44 L.Ed.2d 295 (1975). In fact, as the Supreme Court made clear, the committee's statement that Title VII and Sec. 1981 were co-extensive simply meant that the two statutes co-existed, with the result that Title VII did not pre-empt whatever rights an individual might enjoy under Sec. 1981. Id. 44 Moreover, Gray 's view of Sec. 1981 flatly conflicts with the Supreme Court's holding in Warth v. Seldin. There, an organization whose members included residents of the town of Penfield, New York, complained that the town's zoning ordinance excluded people of low and moderate income in violation of those people's rights under Sec. 1981. This exclusion, in turn, injured the organization's members by depriving them of the benefits of living in an integrated community. Such an injury satisfies the constitutional requirements, and the Court accordingly has recognized it as a basis for standing in suits under the Fair Housing Act (which confers standing to the full extent permitted by Article III). See Trafficante, 409 U.S. at 208-10, 93 S.Ct. at 366-67. In Warth, however, the Court held that Sec. 1981 was critically different from the Fair Housing Act in this respect. Invoking the prudential rule against allowing litigants to raise putative rights of third parties, it accordingly barred the organization's suit. Warth, 422 U.S. at 512-14, 93 S.Ct. at 2212-13. 45 As one would expect, then, other circuits--including our own--have rejected Gray 's view of Sec. 1981. In Mackey v. Nationwide Insurance Companies, 724 F.2d 419 (4th Cir.1984), an insurance agent attempted to challenge his former employer's alleged practice of refusing to underwrite risks in predominantly black neighborhoods. The agent claimed that this practice had forced him to forgo the money that he could have earned by selling policies in these areas. But while Congress could constitutionally have conferred a cause of action upon the agent to redress this injury in fact, the court held that Sec. 1981 did not do so. Distinguishing Sec. 1981 from the Fair Housing Act, the court decided that standing under Sec. 1981 is restricted to the direct victims of the alleged discriminatory practice, at least as long as there is no impediment to suits by those victims. Id. at 422. 46 We too have now explicitly embraced Mackey rather than Gray. In Clifton Terrace Associates v. United Technologies Corp., 929 F.2d 714 (D.C.Cir.1991), the owner of a low-income housing complex sued the Otis Elevator Company and its corporate parent for refusing to negotiate a service contract for the elevators in the complex, allegedly because the residents of the complex were overwhelmingly black. The owner plainly had suffered injury in fact as a result of this refusal, for its elevators were deteriorating; indeed, the city government had taken action against it for violating its duties as a landlord. Accordingly, we dealt with the owner's Fair Housing Act claims on the merits. But we accorded a different treatment to the owner's claims under Sec. 1981. Concluding that the direct victims of the alleged discrimination are the residents of Clifton Terrace rather than the owner, we invoked Mackey to hold that the owner could not sue under Sec. 1981. Id. at 721. 4 Accordingly, our law is now in accord with that of the Supreme Court and other circuits in concluding that Sec. 1981 does not confer a cause of action on persons whose injuries derive only from the violation of others' rights. 47 In arguing that the prudential barriers to standing nonetheless do not preclude its particular suit, the Council cites Des Vergnes v. Seekonk Water District, 601 F.2d 9 (1st Cir.1979). Yet that case does not get it very far. Des Vergnes held simply that Sec. 1981 confers an implied right of action against any other person who, with a racially discriminatory intent, interferes with [the plaintiff's] right to make contracts with nonwhites; by the same token, the statute confers an implied right of action against any other person who, with a racially discriminatory intent, injures [the plaintiff] because he made contracts with nonwhites. Id. at 14; see also Winston v. Lear-Siegler, Inc., 558 F.2d 1266, 1270 (6th Cir.1977); DeMatteis v. Eastman Kodak Co., 511 F.2d 306, 312, modified, 520 F.2d 409 (2d Cir.1975); cf. Sullivan v. Little Hunting Park, 396 U.S. 229, 237, 90 S.Ct. 400, 404-05, 24 L.Ed.2d 386 (1969) (reaching parallel result under Sec. 1982). Implicit in Sec. 1981, these cases declare, is a cause of action protecting people from private retaliation for refusing to violate other people's rights under Sec. 1981, or for exercising their own Sec. 1981 rights. The present case simply does not implicate this principle. 48 The normal presumption against reading a statute to authorize derivative causes of action--that is, causes of action to redress injuries that derive entirely from the violation of someone else's rights under the statute--is subject to only one exception that is even arguably relevant here. Courts sometimes infer that the legislature intended to authorize such causes of action when, in their absence, no one would be able to assert the statutory rights that the legislature created. Because of this inference, a litigant might have a cause of action even though his injuries flow from the violation of other people's statutory rights, at least if both of the following conditions are met: (1) the litigant's interests are aligned with the other people's interests, and (2) the other people are unable to bring suit in their own right. See, e.g., Canfield Aviation v. National Transp. Safety Bd., 854 F.2d 745, 748 (5th Cir.1988); Flittie v. Solem, 827 F.2d 276, 280 (8th Cir.1987); In re Merrill Lynch Relocation Management, Inc., 812 F.2d 1116, 1121 (9th Cir.1987). 49 But even assuming that the Council's interests are aligned with those of the direct victims of BMC's alleged discrimination, the obstacles to suit by those victims are not serious enough to warrant the inference that Sec. 1981 confers a cause of action upon the Council. To be sure, the people to whom BMC denies employment referrals may not necessarily know why their applications were unsuccessful, and so the possible victims of BMC's alleged discrimination may not always know who they are. But the Council itself could remedy much of the problem simply by publicizing the results of its tests and offering litigation assistance to people who suspect (on the basis of this new information) that BMC has discriminated against them. In the present case, as in Warth v. Seldin, there is no indication that [direct victims of discrimination by BMC] are disabled from asserting their own right in a proper case. Warth, 422 U.S. at 510, 95 S.Ct. at 2211. Certainly they do not face anything like the practical obstacles confronting people excluded from a jury for discriminatory reasons, whose rights the Court has allowed a criminal defendant to assert. See Powers v. Ohio, 499 U.S. 400, 414-15, 111 S.Ct. 1364, 1372-73, 113 L.Ed.2d 411 (1991) (describing the daunting barriers to suit by an excluded juror); cf. Scott v. Greenville County, 716 F.2d 1409, 1416 (4th Cir.1983) (hypothesizing preemptive discrimination that could never be identified with any individual victims). 50 The Third Circuit has perceived seemingly inconsistent strains in the Supreme Court's treatment of whether the 'obstacle' factor is an essential prerequisite to third-party standing, Amato v. Wilentz, 952 F.2d 742, 749 (3d Cir.1991), and has resorted to a more flexible balancing approach in an effort to make sense of the Court's jurisprudence. Id. at 749-50 & n. 8. But we think the cases can in fact be reconciled. 51 Apart from cases involving the 'obstacle' factor, the Court generally has allowed a litigant to assert the rights of a third party only when the third party's rights protect that party's relationship with the litigant. Haitian Refugee Center v. Gracey, 809 F.2d 794, 809 (D.C.Cir.1987). 5 In the lion's share of these cases, the litigant seeks to challenge direct restrictions on its own activities on the ground that enforcement of the restrictions against it would dilute or abrogate the rights of third parties. As the Court has summed up its jurisprudence, When ... enforcement of a restriction against the litigant prevents a third party from entering into a relationship with the litigant (typically a contractual relationship), to which relationship the third party has a legal entitlement (typically a constitutional entitlement), third-party standing has been held to exist. United States Dep't of Labor v. Triplett, 494 U.S. 715, 720, 110 S.Ct. 1428, 1431, 108 L.Ed.2d 701 (1990); see also Warth, 422 U.S. at 510, 95 S.Ct. at 2211. For example, the Court has allowed beer vendors to assert the equal-protection rights of their potential customers in challenging a prohibition on the sale of beer to young males, Craig v. Boren, 429 U.S. 190, 195, 97 S.Ct. 451, 455, 50 L.Ed.2d 397 (1976); distributors of contraceptive devices to assert the privacy rights of contraceptive purchasers in challenging restrictions on the distributors, Carey v. Population Servs. International, 431 U.S. 678, 682-84, 97 S.Ct. 2010, 2014-16, 52 L.Ed.2d 675 (1977); and booksellers to assert the First Amendment rights of bookbuyers in challenging the prohibition of certain commercial displays, Virginia v. American Booksellers Ass'n, 484 U.S. 383, 392-93, 108 S.Ct. 636, 642-43, 98 L.Ed.2d 782 (1988). Less frequently, the Court has allowed litigants to assert third parties' rights in challenging restrictions that do not operate directly on the litigants themselves, but that nonetheless allegedly disrupt a special relationship--protected by the rights in question--between the litigants and the third parties. See, e.g., Pierce v. Society of Sisters, 268 U.S. 510, 45 S.Ct. 571, 69 L.Ed. 1070 (1925) (allowing military academy and parochial school to assert constitutional rights of students and parents in challenging state law requiring parents to send their children to government school); see also Caplin & Drysdale, Chartered v. United States, 491 U.S. 617, 623-24 n. 3, 109 S.Ct. 2646, 2651-52 n. 3, 105 L.Ed.2d 528 (1989) (allowing lawyers to challenge federal forfeiture laws that allegedly violate their clients' Sixth Amendment right to counsel); Singleton v. Wulff, 428 U.S. 106, 113-18 & n. 7, 96 S.Ct. 2868, 2873-76 & n. 7, 49 L.Ed.2d 826 (1976) (plurality opinion) (allowing abortion-performing doctors to complain that restrictions on Medicaid payments for abortion violate the constitutional rights of women seeking abortions). See generally National Cottonseed Products Ass'n v. Brock, 825 F.2d 482, 489-92 & n. 15 (D.C.Cir.1987). 52 Whatever the precise limits of these cases, they offer no help to the Council. The Council certainly faces no direct restriction on its own activities, and the Sec. 1981 rights of people who seek referrals from BMC are unrelated to any special relationship between those people and the Council. Under Warth v. Seldin, the Council therefore cannot bring suit to complain about the violation of those people's Sec. 1981 rights. See Warth, 422 U.S. at 514 n. 22, 95 S.Ct. at 2213 n. 22. 53