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NO. 14-1493
UNITED STATES COURT OF APPEALS
FOR THE SEVENTH CIRCUIT
DUNNET BAY CONSTRUCTION COMPANY,
Plaintiff-Appellant,
v.
GARY HANNIG, in his official capacity as Secretary of Transportation
for the Illinois Department of Transportation, et al.,
Defendants-Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
CASE NO. 3:10-cv-03051-RM-SMJ
Honorable Richard Mills
AMICUS BRIEF OF AMERICAN ROAD AND
TRANSPORTATION BUILDERS ASSOCIATION
In Support of Plaintiff-Appellant
Dunnet Bay Construction Company for Reversal
Michael L. Shakman
Edward W. Feldman
Thomas M. Staunton
MILLER SHAKMAN & BEEM LLP
180 N. LaSalle St., Suite 3600
Chicago, IL 60601
(312) 263-3700
Nick Goldstein
Assistant General Counsel
AMERICAN ROAD AND
TRANSPORTATION BUILDERS
ASSOCIATION
1219 28th Street NW
Washington, DC 20007
(202) 289-4434
Attorneys for American Road and Transportation Builders Association
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i
TABLE OF CONTENTS
Identity of Amicus, Its Interest in the Case and
Source of Its Authority to File the Brief ...................................................................1
Statement Required by Fed. R. App. P 29(c)(5)........................................................1
Argument ...................................................................................................................2
1. The Opinion applies a standard that would effectively eliminate
strict scrutiny review of an alleged unlawful quota and replace it with
a deferential standard when a contractor attempts to challenge a state
agency’s implementation of federal DBE goals...................................................3
2. The Opinion erodes the federal policy permitting waivers for
contractors who make “good faith efforts” to meet DBE goals...........................9
3. The Opinion applies an erroneous test of standing that denies a
contractor required to implement a quota system the right to
challenge the quota on equal protection grounds .............................................15
Certificate of Compliance ........................................................................................24
Certificate of Service................................................................................................25
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ii
TABLE OF AUTHORITIES
Adarand Constructors, Inc. v. Penna, Secretary of Transportation, et al.,
515 U.S. 200 (1995)............................................................................................13, 18
Fisher v. Univ. of Texas at Austin, 133 S. Ct. 2411 (2013).....................................13
Monterey Mechanical Co. v. Wilson, 125 F.3d 702 (9th Cir. 1997) ..................20, 22
Northeastern Florida Chapter of Associated General Contractors of America v.
City of Jacksonville, Florida, 508 U.S. 656 (1993) ......................................16-19, 22
Northern Contracting, Inc. v. Illinois Dept. of Transp.,
473 F.3d 715 (7th Cir. 2007).............................................................................4-8, 13
Ricci v. DeStefano, 557 U.S. 557 (2009)....................................................................3
Warth v. Seldin, 422 U.S. 490 (1975).................................................................18-19
W.H. Scott Constr. Co. v. City of Jackson, 199 F.3d 206 (5th Cir. 1999)...............21
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1
Identity of Amicus, Its Interest in the Case
and Source of Its Authority to File the Brief
The 6,000 members of the American Road and Transportation Builders
Association (“ARTBA”) include public agencies, private firms and organizations that
own, plan, design, supply and construct transportation projects throughout the
country. Many are small and/or family-owned. On the construction side, ARTBA’s
membership includes prime contractors, subcontractors and suppliers, some of
which are Disadvantaged Business Enterprise firms (“DBE”). Overall, the
transportation construction industry generates nearly $380 billion annually in U.S.
economic activity and sustains 3.5 million American jobs. ARTBA’s membership
structure includes nearly three dozen affiliated chapters, each of which takes a
major interest in planning and implementing the federal DBE program by the
recipient agencies in their states or regions. This Court’s review of the opinion
below will have an impact on how ARTBA’s members bid on construction projects.
ARTBA is authorized to file this amicus brief under Fed. R. App. P. 29(a) by
consent of all parties.
Statement Required By Fed. R. App. P. 29(c)(5)
ARTBA’s counsel authored this brief. ARTBA raised funds from several
chapters to pay the legal fees and the costs of preparing this brief. No other person
contributed money intended to fund preparing or submitting the brief.
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Argument
ARTBA files this amicus brief because several aspects of the trial court decision
granting summary judgment to the Illinois Department of Transportation (the
“Opinion”) make important changes in the law that would, if affirmed, harm the
American transportation construction industry and undermine the administration
of DBE goals:
1. The Opinion applied a deferential standard of review when a contractor
claims that a state has treated a DBE goal, required by federal law, as an unlawful
minority quota. If upheld, judicial review would turn on technical compliance with
goal-setting regulations rather than whether the goal had been unlawfully
converted to a quota.
2. The Opinion applied that same deferential review to a state agency’s
refusal to grant a waiver to a contractor who claimed to have made good faith, but
unsuccessful, efforts to meet the state’s DBE goal. A deferential standard of review
is contrary to case law applying strict scrutiny to race-based governmental
decisions. The decision adds uncertainty to review of waiver requests and allows
discrimination claims to be disposed of on an improper basis.
3. The Opinion denied standing to sue to contractors who seek to challenge
on equal protection grounds a state’s use of DBE goals as quotas in a manner that
causes otherwise qualifying bids to be rejected. It applied an erroneous theory of
standing under which contractors required to implement quota subcontracting to
obtain public works contracts lack standing to complain. Indeed, under this
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erroneous theory, in most cases prime contractors would have no standing to
complain about losing contracts due to an unlawful subcontractor quota system.
We discuss each point below.
1. The Opinion applies a standard that would effectively eliminate strict
scrutiny review of an alleged unlawful quota and replace it with a
deferential standard when a contractor attempts to challenge a state
agency’s implementation of federal DBE goals.
The federal DBE program seeks to encourage public contracting to DBEs, while
complying with Supreme Court decisions that generally bar racial or other quotas.
See Opinion of February 12, 2014 (“Opinion”) 65 (Dkt. #180, R.4434), quoting Ricci
v. DeStefano, 557 U.S. 557, 582 (2009) (citing prior authority). Underlying the DBE
program is a potential tension between the legitimate goal of encouraging increased
participation for all DBEs (businesses that are 51% owned by persons who meet the
definition of socially or economically disadvantaged) without violating the rules
against generalized use of racial or other quotas. The issue presented by this case is
likely to reoccur as state agencies, responding to political or other pressure, attempt
to maximize the participation of women and minorities (who are generally
presumed to be DBEs) in public works projects. The Opinion establishes an
erroneous standard of review that would, if upheld, effectively eliminate meaningful
judicial review of political manipulation of the DBE program by state agencies.
The Opinion correctly notes that “[a]ll entities receiving funds from [the Federal
Highway Administration] FHWA must have a DBE program which meets [federal]
requirements,” and correctly described the “non-mandatory, non-exclusive and non-
exhaustive actions” that may be used to determine if a contractor “took all
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necessary and reasonable steps to achieve a DBE goal. . .” Opinion 62-63 (Dkt.
#180, R.4431-32).
But then the district court went astray by misreading the leading decision in
this Circuit, Northern Contracting, Inc. v. Illinois Dept. of Transp., 473 F.3d 715
(7th Cir. 2007), as stating the sole, and very limited, basis for review of DBE
programs. The district court applied Northern Contracting even though that case
arose in a very different context that does not exist here. Its ruling would effectively
turn what should be strict scrutiny review into a deferential exercise of
administrative agency review. The district court concluded that because the Illinois
Department of Transportation (“IDOT”) complied with the federal guidelines for
how a state agency should determine its DBE goal, a low bidder who lost a contract
because it did not meet that goal could not challenge the loss on the ground that the
state agency had converted the goal to an unlawful quota.1
Based on its reading of Northern Contracting, the Opinion described the scope of
judicial review as follows:
A state entity such as IDOT implementing a congressionally
mandated program may rely "on the federal government's compelling
interest in remedying the effects of past discrimination in the national
construction market." . . . . In these instances, the state is acting as an
agent of the federal government and is "insulated from this sort of
constitutional attack, absent a showing that the state exceeded its
federal authority." [Northern Contracting] . . . at 721. Accordingly, any
"challenge to a state's application of federally mandated program must
be limited to the question of whether the state exceeded its authority."
1 As amicus it is not the ARTBA’s role to say whether a fact-finder presented with
the evidence Dunnet Bay assembled would find that DBE goals were converted to a
minority quota. But as Dunnet Bay argues in its brief (Dunnet Bay Brief passim),
the evidence was sufficient to permit a fact-finder to reach that conclusion.
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Id. at 722. Therefore, the Court must determine if IDOT exceeded its
authority granted under the federal rules or if Dunnet Bay's challenge
is foreclosed by Northern Contracting. [Opinion 65-66 (Dkt. #180,
R.4434-35); (italics added).]
The degree of deference afforded IDOT by the district court is evidenced by its
apparent determination that even if its goals operated as a de facto quota, IDOT did
not “exceed[] its authority” in refusing to award the Eisenhower Expressway project
to Dunnet Bay Construction Company because “IDOT did in fact employ a thorough
process before arriving at the [DBE goal] figure [of 22.2%].” It added:
Additionally, because the federal regulations do not specify a procedure
for arriving at contract goals, it is not apparent how IDOT could have
exceeded its federal authority. Any challenge on this factor fails under
Northern Contracting. [Opinion 67 (Dkt. #180, R.4436).]
As amicus, ARTBA is concerned that under this standard judicial review is
reduced to a deferential and mechanical determination focused solely upon whether
an agency could document compliance with federal regulations, even in the face of
significant evidence that a goal was applied as a quota. The district court appeared
at times to slide from deferential review to no review at all, by stating “it is not
apparent how IDOT could have exceeded its federal authority.” Opinion at 67 (Dkt.
#180, R.4436).2
Dunnet Bay presented evidence that representatives of the office of the Governor
of Illinois repeatedly stated that the DBE program was intended to increase
2
ARTBA’s concern is increased by the fact that the federal regulations only
describe various non-exclusive “methods a recipient [of federal funds] may use to
calculate DBE availability”, and thus do not provide definitive guidance even on
how to calculate goals. Northern Contracting, Inc. v. Illinois, 473 F.3d 715, 718 (7th
Cir. 2007).
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“minority” (not DBE) participation; the Governor’s office and IDOT officials publicly
stated that there was a no-waiver policy for failing to meet the goals for minority
participation (despite federal policy authorizing waivers); and the IDOT employee
with direct responsibility for DBE compliance concluded that IDOT was violating
the rules by manipulating the DBE guidelines. Opinion at 30-32, 34-36, 47-48, 50
and 52 (Dkt. #180, R.4399-4401, 4403-05, 4416-17, 4419 and 4421).
Instead of reviewing that evidence to determine if Dunnet Bay’s facts generated
an issue for trial on whether goals were treated as quotas, the district court
concluded that because “the federal regulations do not specify a procedure for
arriving at contract goals” IDOT could not have done anything wrong. Opinion at 67
(Dkt. #180, R.4436). That was a serious misapplication of Northern Contracting.
Nothing in Northern Contracting remotely suggests such a limited scope of
judicial review. In that case the Court confirmed that strict scrutiny was the
appropriate standard. 473 F.3d at 720. But the plaintiff’s claim in that case differed
significantly from the one Dunnet Bay presented in this case. In Northern
Contracting, the plaintiff challenged whether IDOT had followed the applicable
federal regulations in the three specific respects asserted by the plaintiff: failing to
calculate correctly the available number of DBEs in Illinois, failing to adjust DBE
goals for local market conditions, and failing to use race-neutral means to increase
DBE participation by awarding contracts to DBEs other than under the DBE
program. Id. at 722-23. Thus, the case was limited to whether IDOT followed the
guidance provided by non-binding federal regulations, with no suggestion that
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quotas were involved. In Northern Contracting, the Court’s focus was solely on
IDOT’s application of federal regulations. The case presented a straightforward
review of federal regulations and their application by a state agency.
This case is different. The facts presented by Dunnet Bay, if proven, would
establish that IDOT had imposed a quota system. Thus, even if review is “limited to
the question of whether the state exceeded its authority,” Northern Contracting, 473
F.3d at 722, the quota evidence answers that question in the affirmative. If there
was a quota, the state necessarily “exceeded its authority,” regardless of any
superficial showing of compliance with the regulations.
Moreover, unlike Northern Contracting, the dispute in this case is not over
whether “the state [did] exactly what the [federal] statute expects it to do.” Dunnet
Bay was not attempting “collaterally [to] attack the federal regulations through a
challenge to IDOT’s program.” Northern Contracting, 473 F.3d at 721-22. Dunnet
Bay did not allege that IDOT misapplied specific federal regulations by using the
wrong data, for example, to create a DBE goal. Rather, it alleged that the
Governor’s office directed IDOT to apply the DBE goals for the Eisenhower
Expressway contract as an illegal minority quota, with no waivers and no tolerance
for failing to reach the goal. Once substantial evidence was presented of an
unlawful quota system, judicial scrutiny was required to be strict and searching.
The district court should not have limited itself to the federal regulatory guidance,
but instead should have closely reviewed the evidence of the de facto quota system.
Had it done so, it seems very likely that it would have found that a genuine issue of
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fact exists as to whether IDOT created a quota, which federal law prohibits absent
special circumstances.
Rather than deferring to a state agency’s application of federal regulations as
the limit of its review, the district court should have focused on whether there was
enough evidence presented by Dunnet Bay to generate a triable issue as to whether
the minority participation goals, as applied by the Governor and IDOT, were
effectively a quota.
Unfortunately, the district court misapplied Northern Contracting to allow
review only on a deferential standard to determine if IDOT “exceeded authority”
under non-binding federal guidelines. It also appears to have allowed that standard
to control or influence its determination whether IDOT had adopted an
impermissible policy against waivers of DBE goals. See Opinion at 69 (Dkt. #180,
R.4438) (“IDOT did not exceed its federal authority by adopting a no-waiver policy”).
A less deferential standard of review could have led it to conclude that a material
factual dispute exists on the quota claim, including whether IDOT effectively
employed a no-waiver policy as a means of implementing the quota.
ARTBA’s members, from time to time, litigate disputes with state agencies that
administer federal-aid construction contracts subject to DBE guidelines. The
approach that the district court took to judicial review of such disputes, if affirmed,
will harm members of ARTBA and others who engage in such litigation by denying
meaningful review of serious allegations, and relegating the judicial function to
evaluating technical compliance with non-binding federal guidelines, while
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disregarding evidence that the “goals” were being manipulated to implement
unlawful quotas.
2. The Opinion erodes the federal policy permitting waivers for
contractors who make “good faith efforts” to meet DBE goals.
ARTBA members often bid as prime contractors on federal-aid transportation
construction projects. The federal rules for administration of the DBE program
recognize that, for legitimate market reasons, these prime contractors will not
always be able to meet DBE goals when bidding on projects. Prime contractors in
these situations are to provide documentation of their good faith efforts to meet the
goal and request a waiver from the state or local transportation agency in question.
There are federal guidelines addressing this waiver-granting process, although, as
noted, they are non-exclusive.
Waivers are a necessary part of the federal program requiring DBE participation
because of basic market realities. Within some geographic areas, there are in fact
not enough certified and available DBE firms, or an inadequate number of such
firms qualified and available to perform certain subcontracting disciplines needed
for a particular construction project. As administered by a state or local
transportation agency, a waiver process must be as objective and transparent as
possible. As participants in competitive bidding for a contract, ARTBA’s members
have a great interest in “playing by the same set of rules.” A subjective or
mysterious process for granting a good faith effort waiver severely undermines that
principle.
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ARTBA’s members also pride themselves on providing maximum value for their
bids, which greatly benefits the project’s public owner-agency and the taxpayers. To
do so, prime contractors require as much certainty as possible in the bidding
process, including the prices of their subcontractors’ bids and the manner in which
public agencies will administer compliance for programs like DBE participation. A
prime contractor will interpret uncertainty in the waiver process as added risk and
therefore increase the overall price of its bid. Ultimately this will lead to more
expensive projects and less value for the taxpayers.
Even more importantly, a no-waiver rule also turns a goal-based DBE program
into a de facto quota. Consistent and fair administration of legally-proper waiver
principles is, therefore, important to ARTBA’s members.
In the face of substantial evidence to the contrary presented by Dunnet Bay, the
district court concluded that IDOT had neither a no-waiver policy nor a waiver
policy that was so difficult to meet that it operated as a de facto quota. The district
court granted IDOT summary judgment on the waiver issue. In reaching that
conclusion the district court appears to have mixed the question whether IDOT
applied a quota to Dunnet Bay’s bid with whether IDOT applied a quota to other
contractors on separate contracts. The district court resolved the issue factually by
concluding that because IDOT granted waivers to other contractors, it did not apply
a quota to Dunnet Bay. Opinion 68-69 (Dkt. #180, R.4437-38). 3 Dunnet Bay
3 It is important to note that the waiver the district court refers to was not
granted until March 4, 2010, after Dunnet Bay filed this case (Dkt. #1, R.25) and
IDOT had appeared (no Docket #, R.271). Opinion 69 (Dkt. #180, R.4438). In
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discusses the evidence on the no-waiver issue and whether that evidence generated
a fact issue for trial. See Dunnet Bay Brief at 40-41. As amicus it would not be
appropriate for ARTBA to argue what the evidence showed.
ARTBA is concerned, however, that the district court’s treatment of the no-
waiver policy, including IDOT’s internal review of the issue, applied an erroneous
standard of review that, if affirmed, will adversely affect ARTBA members who may
seek judicial review of decisions by government agencies to deny waivers of DBE
goals.
Essentially, the district court deferred to IDOT’s internal review of the waiver
request when Dunnet Bay requested reconsideration of denial of the contract. The
district court deferred to William Grunloh, IDOT’s internal reviewer: “. . . a
reconsideration officer such as Grunloh has significant discretion and will often be
called on to make a ‘judgment call’ regarding the efforts of the bidder. “The Court is
unable to conclude that Bill Grunloh erred in determining Dunnet Bay did not
make adequate good faith efforts.” Opinion 72 (Dkt. #180, R.4441).
The district court so found despite substantial evidence from which a fact-finder
could conclude that a waiver should have been granted if there was not a quota.
That evidence included:
(a) Dunnet Bay, the low bidder, had (i) solicited hundreds of
DBEs via faxes and phone calls, (ii) attended pre-bid meetings
designed to provide outreach to DBEs, (iii) contacted appropriate
addition, the waiver was not on the contract on which Dunnet Bay had bid. Opinion
69 (Dkt. #180, R.4438).
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minority and female organizations, and (iv) had a track record of
generating substantial DBE participation.
(b) Both IDOT and the court recognized that Dunnet Bay’s DBE
outreach efforts may have been impeded by IDOT’s failure to list
Dunnet Bay as a qualified bidder, thus discouraging DBE firms from
responding when Dunnet Bay sought DBE subcontractors.
(c) Dunnet Bay received ten quotes from DBE subcontractors
shortly after the bid opening on January 15, 2010; at least one of those
bids arrived late as a direct result of IDOT’s failure to list Dunnet Bay;
if Dunnet Bay had received those DBE subcontractor quotes earlier, it
would have almost tripled its DBE utilization.
See Opinion 19-20, 26 (Dkt. #180, R.4388-89, 4395).
Despite these facts and others, the district court upheld IDOT’s internal review
of the decision not to grant a waiver by applying the following reasoning:
The [federal] regulations refer to eight non-exhaustive factors
which can be considered in assessing good faith. . . .
The factors to be considered are non-mandatory, non-exhaustive
and nonexclusive. A contractor who does not meet the goals "must
show that it took all necessary and reasonable steps to achieve a DBE
goal." 49 C.F.R. § Pt. 26 App. A. Based on this standard, a
reconsideration officer such as [IDOT’s William] Grunloh has
significant discretion and will often be called on to make a "judgment
call" regarding the efforts of the bidder. Accordingly, it is not
surprising that another IDOT official might disagree with the decision.
The Court is unable to conclude that Bill Grunloh erred in determining
Dunnet Bay did not make adequate good faith efforts. Perhaps the
strongest evidence that Dunnet Bay did not take "all necessary and
reasonable steps to achieve a DBE goal" is that its DBE participation
was under 9% while other bidders were able to reach the 22% goal.
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Accordingly, the Court concludes that IDOT's decision on
reconsideration of the rejection of Dunnet Bay's bid was consistent with
the regulations and did not exceed IDOT's authority under federal law.
[Opinion 71-72 (Dkt. #180, R.4440-41); italics added.]
The district court entirely missed the point of Dunnet Bay’s evidence. If
affirmed, its reasoning would permit a state agency to treat DBE project goals as
quotas so long as another bidder met the quota and the agency employed an
internal review procedure through which the agency’s reviewing officer was given
“significant discretion” to make a “judgment call” and rejected the complaining
contractor’s waiver request. If district courts review allegations that a state agency
has used an illegal quota by deferential review of the agency’s internal
reconsideration process, the strict scrutiny standard mandated by the Supreme
Court in Adarand Constructors, Inc. v. Penna, 515 U.S. 200 (1995), and applied by
this Court in Northern Contracting will have been eliminated.4
The district court’s reasoning is wrong for several reasons. First, the extent to
which Dunnet Bay took advantage of eight federally-approved but non-binding
techniques to recruit DBE firms, or others of its own invention, to line up DBE
firms is a different issue than whether IDOT administered the DBE program as a
quota. If the fact-finder accepts Dunnet Bay’s evidence on that issue to explain why
Dunnet Bay, the low bidder, did not get the contract, then Dunnet Bay’s good faith
4
As the Supreme Court recently stated, “[s]trict scrutiny is a searching
examination, and [it is] the government [that] bears the burden to prove that the
reasons for any racial classification are clearly identified and unquestionably
legitimate.” Fisher v. Univ. of Texas at Austin, 133 S. Ct. 2411, 2419 (2013)
(citations and quotations omitted).
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efforts or lack thereof would not change the fact that the program was being
operated as a quota. At the very least Dunnet Bay should be entitled to try to prove
to the fact-finder that under IDOT’s normal waiver practice it would have received
the waiver, and the contract.
Second, in the face of significant evidence that IDOT implemented a quota, the
district court should not have evaluated the agency’s reconsideration decision by
treating it as subject to “significant [agency] discretion” and to limit its inquiry to
whether “the rejection of Dunnet Bay's bid was consistent with the regulations . . .”
The correct approach would have been to resolve Dunnet Bay’s claim that IDOT
implemented the DBE program as a quota applying strict scrutiny, and only if that
claim were rejected should the agency’s internal decision be reviewed to determine
if Dunnet Bay did not make good faith efforts to recruit more DBEs.
Moreover, Dunnet Bay presented evidence to support its argument that the
reconsideration process was part of quota implementation. As the court noted, at
Opinion 27 (Dkt. #180, R.4396), Ms. Lyle, IDOT’s DBE compliance expert,
recommended after the reconsideration hearing that Dunnet Bay receive the waiver
and the contract. In these circumstances it was wrong to evaluate the waiver as if
the only question was whether the reconsideration officer abused his discretion.
ARTBA is also concerned with the consequences of the court’s third, and
apparently principal, reason for validating IDOT’s denial of a waiver – its
conclusion that the effectiveness of the DBE outreach goal was shown by the fact
that Dunnet Bay reached only 9% DBE participation while other bidders (and
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Dunnet Bay on the rebid) reached 22%. In this case, the fact that a 22% “goal” was
achieved following public statements by IDOT and the Governor’s office that there
would be no waivers, and following the rejection of Dunnet Bay’s low bid for failing
to reach 22%, is fully consistent with the conclusion that everyone understood that a
quota was being applied and bidders had to meet the quota, whether lawful or not.
ARTBA is concerned that affirmance of the Opinion would set a bad precedent
by allowing an agency to insist on meeting a DBE “goal” and then asserting that
because the goal was met it proves the reasonableness of the goal, as opposed to
proving that the goal was really a quota.
3. The Opinion applies an erroneous test of standing that denies a
contractor required to implement a quota system the right to challenge
the quota on equal protection grounds.
An issue of great concern to ARTBA and its members is that the Opinion
effectively eliminates standing for prime contractor-members who are required to
engage in unlawful discrimination at the subcontractor level in order to prevent
rejection of their otherwise-qualifying bids.
The standing issue should have been straightforward. Dunnet Bay was the low
bidder for a $10 million contract. It alleged, and presented evidence, that IDOT
rejected its bid because of a DBE quota. It alleged that but for the allegedly
unlawful quota, it would have been awarded the contract. Therefore, it alleged a
$10 million harm directly caused by the application of an unconstitutional quota.
Standing is clear under controlling case law, and as a matter of common sense. In
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Northeastern Florida Chapter of Associated General Contractors of America v. City
of Jacksonville, Florida, 508 U.S. 656, 663 (1993), the Supreme Court held:
The doctrine of standing is "an essential and unchanging part of
the case-or-controversy requirement of Article III," . . . . It has been
established by a long line of cases that a party seeking to invoke a
federal court's jurisdiction must demonstrate three things: (1) "injury
in fact," by which we mean an invasion of a legally protected interest
that is "(a) concrete and particularized, and (b) actual or imminent, not
conjectural or hypothetical," . . . .; (2) a causal relationship between the
injury and the challenged conduct, by which we mean that the injury
"fairly can be traced to the challenged action of the defendant," and has
not resulted "from the independent action of some third party not
before the court," . . . .; and (3) a likelihood that the injury will be
redressed by a favorable decision, by which we mean that the "prospect
of obtaining relief from the injury as a result of a favorable ruling" is
not "too speculative," . . . [internal citations omitted.]
Dunnet Bay alleged all three elements. It alleged that it would have been awarded
a specific contract but for IDOT’s quota. (Dkt. #1, R.33). It also alleged:
. . . [i]n that IDOT’s no-waiver policy results in a rejection of any bid
as non-responsive that fails to meet the contract goal despite evidence
of a bidder’s good faith efforts to do so, the 22% contract goal
constitutes an unlawful quota. [Dkt. #1, R.33.]
Dunnet Bay thus alleged a direct, concrete and particularized injury to it as a result
of a racial quota in the form of its loss of a $10 million contract. In the language of
Northeastern Florida, that was an “injury in fact” that was “causally connected” to
the quota; and it would “be redressed by a favorable decision.” Its allegations met
all the standing requirements specified by the Supreme Court. That should have
been the end of the matter. Nevertheless, the district court held that Dunnet Bay
lacked standing to complain. This Court should correct that error.
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The district court went astray by misreading standing doctrine. It muddled
concepts of discrimination (which go to the merits) with concepts of injury (which go
to standing). The Opinion asserts that because IDOT did not treat Dunnet Bay
differently than the other contractors it was bidding against, it suffered no
competitive disadvantage in relation to its peers, which thereby defeated standing.
Opinion 74-75 (Dkt. #180, R.4443-44). But that is a merits argument (and a wrong
one), not a standing argument.
Standing is clear under Northeastern Florida (and many other cases) because
the three elements of injury, causation and redressability are met. Although
labeling its analysis as a standing inquiry, the district court essentially found
instead that no equal protection violation could have occurred because Dunnet Bay
and its competitors all operated under the same standard. That cannot be correct
where the standard itself is unconstitutional.
A hypothetical illustrates the point. Assume two contractors bid on a State
contract. The State erects an unconstitutional rule: it requires the contractors to
discriminate by engaging at least 22% minority subcontractors even though that
level of participation is not supported by market-based evidence. Contractor A is
low bidder but loses out to Contractor B because it did not meet the target. Under
the district court’s logic, no equal protection violation occurred because both
contractors were forced to play under the same rules, and Contractor B had no
“competitive advantage” over Contractor A. That is incorrect. Rigging the game
with an illegal rule constitutes the equal protection violation, regardless of whether
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
18
all compete on equal footing under that unlawful standard. The rule divides the
competitors into two classes: those willing and able to clear the illegal hurdle, and
those not. The injury (and, hence standing) results from the application of the
illegal hurdle to deprive Contractor A (Dunnet Bay) of the contract.
In reaching the contrary conclusion, the district court erroneously concluded that
“unequal footing” was the only means to establish standing. But that is only one
way to do so. One can also establish standing where there is equal footing under an
unequal standard. In Adarand Constructors, Inc., and Northeastern Florida, supra,
the Supreme Court held that a contractor may show standing based on an “inability
to compete on an equal footing in the bidding process, . . . .” Those cases did not
purport, however, to define the only road to standing.
Northeastern Florida’s discussion of Warth v. Seldin, 422 U.S. 490 (1975), made
that clear. In language that applies here, the Court stated that “[a]n allegation that
a ‘specific project’ was ‘precluded’ by the existence of or administration of [a
program], would certainly have been sufficient to establish standing.” 508 U.S. at
668. The Court made that statement in distinguishing Warth, where it had found
no standing for contractors to object to a town’s zoning ordinance that prevented
people of low and moderate income from living in the town. In Warth, the Court
based the lack of standing upon the fact that the contractors failed to identify any
contract that was lost. Warth was otherwise factually similar to this case: in both
cases the contractors were complaining that the government’s policy effected
discrimination against someone other than the contractor-plaintiffs.
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
19
The Supreme Court recognized in Northeastern Florida that the contractor-
plaintiffs in Warth would have had standing if they had alleged “that a ‘specific
project’ was ‘precluded’ by the existence of or administration” of the Town’s zoning
policy. The Court thereby answered the standing issue here. Dunnet Bay clearly
alleged that it lost the Eisenhower Expressway contract because IDOT converted a
goal into a quota that it could not meet. Under Northeastern Florida’s discussion of
Warth, that afforded standing for Dunnet Bay. To conclude otherwise would
eliminate any remedy for a contractor when a government program requires the
contractor to discriminate on the basis of race in awarding subcontracts. Such a
standing rule would make no sense and would frustrate the anti-discrimination
policies of the law and adversely affect ARTBA’s members.
Contrary to the Opinion at 74-75 (Dkt. #180, R.4443-44), the fact that Dunnet
Bay itself was not singled out because of the race of its owners, or that of its
competitors, defeats neither standing nor an equal protection claim. It suffered
injury in fact as a result of an unconstitutional minority-based quota. The State
engaged in discrimination and Dunnet Bay lost a contract as a result. Under the
Northeastern Florida-Warth analysis, that is sufficient to establish standing even
though the race of Dunnet Bay’s and its competitors’ owners was not a factor in the
decision.
Dunnet Bay’s injury was not limited to the loss of the contract (although that
loss was certainly sufficient to create standing). A corollary of the point made
above (about the rules of the game being unlawful) is that the unlawful rules force
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
20
one to violate the law in order to compete against other bidders. Dunnet Bay was,
therefore, also injured because the quota system forces contractors into a Hobson’s
choice: either become party to unlawful discrimination or lose your chance for a
contract.
Dunnet Bay essentially complained that because of IDOT’s de facto quota it
would have had to engage in discrimination itself in favor of some subcontractors
and against others on the basis of minority status to get the Eisenhower
Expressway contract. Courts have found standing where a government program
requires a contractor to discriminate, or attempt to discriminate, against others. In
Monterey Mechanical Co. v. Wilson, 125 F.3d 702, 707 (9th Cir. 1997), the court
stated:
Even if a general contractor suffers no discrimination itself, it is hurt
by a law requiring it to discriminate, or try to discriminate, against
others, on the basis of their ethnicity or sex. A person required by the
government to discriminate by ethnicity or sex against others has
standing to challenge the validity of the requirement, even though the
government does not discriminate against him.
That standard fits squarely to the facts alleged here: Assume that IDOT’s quota did
not discriminate against Dunnet Bay on the basis of its owners’ race or ethnicity, as
the district court concluded (erroneously, as discussed below). Nonetheless, by
denying Dunnet Bay standing the district court denied Dunnet Bay the opportunity
to prove that IDOT required it to discriminate against non-minority subcontractors.
Dunnet Bay has standing to challenge the quota under Monterey Mechanical
Co., supra. The district court was wrong to conclude otherwise. Under its approach,
prime contractors could never challenge government programs that require them to
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
21
use quotas to select subcontractors, unless they could prove they were directly
competing against a minority prime contractor. Because many ARTBA members
regularly bid for contracts and must select subcontractors for appropriate portions
of their work, they would suffer serious harm – lack of standing to sue – if the
district court’s reasoning were affirmed.
Even reading the standing requirement as the district court did – to require
direct competition by Dunnet Bay with DBE firms – Dunnet Bay’s allegations
should have afforded it standing. As the district court assumed (Opinion at 76, Dkt.
#180, R.4445), IDOT permitted general contractors that were DBEs to take
advantage of their status by performing a portion of the work directly. As a non-
DBE business, Dunnet Bay could not do the same and have it count as DBE work.
Thus, IDOT deprived Dunnet Bay of the right to compete for the contract on equal
footing with DBE prime contractors. See, e.g., W.H. Scott Constr. Co. v. City of
Jackson, 199 F.3d 206, 215-16 (5th Cir. 1999) (contractor denied the right to
compete on equal footing, and thus had standing to sue, where program permitted
DBE-qualified general contractor to use its own work to satisfy minority
participation goals and avoid good faith requirements).
The district court recognized this fact: “It is true that a hypothetical DBE might
not have had to subcontract work on the Eisenhower project, thereby providing it
with a competitive advantage over the other bidders.” But the district court
rejected the argument, stating that “Dunnet Bay has not pointed to another
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
22
contractor that did not have to meet the same requirements it did.” Opinion at 76
(Dkt. #180, R.4445).
Dunnet Bay was not required to prove that there was another contractor who
benefited from the challenged quota. For standing purposes, if an unlawful practice
or policy imposes a loss on the plaintiff, the plaintiff is not also required to show
who won from its loss, so long as it has a plausible basis to allege that it was the
loser. As the Court stated in Northeastern Florida:
When the government erects a barrier that makes it more difficult for
members of one group to obtain a benefit than it is for another group, a
member of the former group seeking to challenge the barrier need not
allege that he would have obtained the benefit but for the barrier to
establish standing. The “injury in fact” in an equal protection case of
this variety is the denial of equal treatment resulting from the
imposition of the barrier, not the ultimate inability to obtain the benefit.
508 U.S. at 666 [italics added].
Thus, both under Monterey Mechanical Co., which recognizes a contractor’s
standing to object when a government program requires it to discriminate among
subcontractors, and under Northeastern Florida, Dunnet Bay had standing.
Respectfully submitted,
American Road and Transportation Builders
Association
By: s/ Thomas M. Staunton
One of its attorneys
Dated: June 9, 2014
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
23
Nick Goldstein
Assistant General Counsel
American Road & Transportation Builders Association
1219 28th Street NW
Washington, DC 20007
(202) 289-4434
Michael L. Shakman
Edward W. Feldman
Thomas M. Staunton
Miller Shakman & Beem LLP
180 N. LaSalle Street
Chicago, Illinois 60601
mlshak@aol.com
efeldman@millershakman.com
tstaunton@millershakman.com
312-363-3700
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
24
CERTIFICATE OF COMPLIANCE
WITH FEDERAL RULE OF APPELLATE PROCEDURE 32
This brief complies with the type-volume limitation of Fed. R. App. P. 32(a)(7)(B)
because this brief contains 6,402 words, excluding the parts of the brief exempted
by Fed. R. App. P. 32(a)(7)(B)(iii).
This brief complies with the typeface requirements of Fed. R. App. P. 32(a)(5), as
modified by Seventh Circuit Rule 32(b), and the type style requirements of Fed. R.
App. P. 32(a)(6) because this brief has been prepared in a proportionally spaced
typeface using Microsoft Office Word 2010 in 12 point Century Schoolbook plain,
roman style font.
American Road and Transportation Builders
Association
By: s/ Thomas M. Staunton
One of its attorneys
Dated: June 9, 2014
Nick Goldstein
Assistant General Counsel
American Road & Transportation Builders Association
1219 28th Street NW
Washington, DC 20007
(202) 289-4434
Michael L. Shakman
Edward W. Feldman
Thomas M. Staunton
Miller Shakman & Beem LLP
180 N. LaSalle Street
Chicago, Illinois 60601
mlshak@aol.com
efeldman@millershakman.com
tstaunton@millershakman.com
312-363-3700
Attorneys for American Road and Transportation
Builders Association
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
25
CERTIFICATE OF SERVICE
I hereby certify that on June 9, 2014, I caused the foregoing to be electronically
filed with the Clerk of the Court for the United States Court of Appeals for the
Seventh Circuit by using the CM/ECF system. I certify that all participants in the
case are registered CM/ECF users and that service will be accomplished by the
CM/ECF system.
American Road and Transportation Builders
Association
By: s/ Thomas M. Staunton
One of its attorneys
Dated: June 9, 2014
Nick Goldstein
Assistant General Counsel
American Road & Transportation Builders Association
1219 28th Street NW
Washington, DC 20007
(202) 289-4434
Michael L. Shakman
Edward W. Feldman
Thomas M. Staunton
Miller Shakman & Beem LLP
180 N. LaSalle Street
Chicago, Illinois 60601
mlshak@aol.com
efeldman@millershakman.com
tstaunton@millershakman.com
312-363-3700
Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28

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Filed artba amicus brief

  • 1. NO. 14-1493 UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT DUNNET BAY CONSTRUCTION COMPANY, Plaintiff-Appellant, v. GARY HANNIG, in his official capacity as Secretary of Transportation for the Illinois Department of Transportation, et al., Defendants-Appellees. APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS CASE NO. 3:10-cv-03051-RM-SMJ Honorable Richard Mills AMICUS BRIEF OF AMERICAN ROAD AND TRANSPORTATION BUILDERS ASSOCIATION In Support of Plaintiff-Appellant Dunnet Bay Construction Company for Reversal Michael L. Shakman Edward W. Feldman Thomas M. Staunton MILLER SHAKMAN & BEEM LLP 180 N. LaSalle St., Suite 3600 Chicago, IL 60601 (312) 263-3700 Nick Goldstein Assistant General Counsel AMERICAN ROAD AND TRANSPORTATION BUILDERS ASSOCIATION 1219 28th Street NW Washington, DC 20007 (202) 289-4434 Attorneys for American Road and Transportation Builders Association Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 2. i TABLE OF CONTENTS Identity of Amicus, Its Interest in the Case and Source of Its Authority to File the Brief ...................................................................1 Statement Required by Fed. R. App. P 29(c)(5)........................................................1 Argument ...................................................................................................................2 1. The Opinion applies a standard that would effectively eliminate strict scrutiny review of an alleged unlawful quota and replace it with a deferential standard when a contractor attempts to challenge a state agency’s implementation of federal DBE goals...................................................3 2. The Opinion erodes the federal policy permitting waivers for contractors who make “good faith efforts” to meet DBE goals...........................9 3. The Opinion applies an erroneous test of standing that denies a contractor required to implement a quota system the right to challenge the quota on equal protection grounds .............................................15 Certificate of Compliance ........................................................................................24 Certificate of Service................................................................................................25 Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 3. ii TABLE OF AUTHORITIES Adarand Constructors, Inc. v. Penna, Secretary of Transportation, et al., 515 U.S. 200 (1995)............................................................................................13, 18 Fisher v. Univ. of Texas at Austin, 133 S. Ct. 2411 (2013).....................................13 Monterey Mechanical Co. v. Wilson, 125 F.3d 702 (9th Cir. 1997) ..................20, 22 Northeastern Florida Chapter of Associated General Contractors of America v. City of Jacksonville, Florida, 508 U.S. 656 (1993) ......................................16-19, 22 Northern Contracting, Inc. v. Illinois Dept. of Transp., 473 F.3d 715 (7th Cir. 2007).............................................................................4-8, 13 Ricci v. DeStefano, 557 U.S. 557 (2009)....................................................................3 Warth v. Seldin, 422 U.S. 490 (1975).................................................................18-19 W.H. Scott Constr. Co. v. City of Jackson, 199 F.3d 206 (5th Cir. 1999)...............21 Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 4. 1 Identity of Amicus, Its Interest in the Case and Source of Its Authority to File the Brief The 6,000 members of the American Road and Transportation Builders Association (“ARTBA”) include public agencies, private firms and organizations that own, plan, design, supply and construct transportation projects throughout the country. Many are small and/or family-owned. On the construction side, ARTBA’s membership includes prime contractors, subcontractors and suppliers, some of which are Disadvantaged Business Enterprise firms (“DBE”). Overall, the transportation construction industry generates nearly $380 billion annually in U.S. economic activity and sustains 3.5 million American jobs. ARTBA’s membership structure includes nearly three dozen affiliated chapters, each of which takes a major interest in planning and implementing the federal DBE program by the recipient agencies in their states or regions. This Court’s review of the opinion below will have an impact on how ARTBA’s members bid on construction projects. ARTBA is authorized to file this amicus brief under Fed. R. App. P. 29(a) by consent of all parties. Statement Required By Fed. R. App. P. 29(c)(5) ARTBA’s counsel authored this brief. ARTBA raised funds from several chapters to pay the legal fees and the costs of preparing this brief. No other person contributed money intended to fund preparing or submitting the brief. Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 5. 2 Argument ARTBA files this amicus brief because several aspects of the trial court decision granting summary judgment to the Illinois Department of Transportation (the “Opinion”) make important changes in the law that would, if affirmed, harm the American transportation construction industry and undermine the administration of DBE goals: 1. The Opinion applied a deferential standard of review when a contractor claims that a state has treated a DBE goal, required by federal law, as an unlawful minority quota. If upheld, judicial review would turn on technical compliance with goal-setting regulations rather than whether the goal had been unlawfully converted to a quota. 2. The Opinion applied that same deferential review to a state agency’s refusal to grant a waiver to a contractor who claimed to have made good faith, but unsuccessful, efforts to meet the state’s DBE goal. A deferential standard of review is contrary to case law applying strict scrutiny to race-based governmental decisions. The decision adds uncertainty to review of waiver requests and allows discrimination claims to be disposed of on an improper basis. 3. The Opinion denied standing to sue to contractors who seek to challenge on equal protection grounds a state’s use of DBE goals as quotas in a manner that causes otherwise qualifying bids to be rejected. It applied an erroneous theory of standing under which contractors required to implement quota subcontracting to obtain public works contracts lack standing to complain. Indeed, under this Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 6. 3 erroneous theory, in most cases prime contractors would have no standing to complain about losing contracts due to an unlawful subcontractor quota system. We discuss each point below. 1. The Opinion applies a standard that would effectively eliminate strict scrutiny review of an alleged unlawful quota and replace it with a deferential standard when a contractor attempts to challenge a state agency’s implementation of federal DBE goals. The federal DBE program seeks to encourage public contracting to DBEs, while complying with Supreme Court decisions that generally bar racial or other quotas. See Opinion of February 12, 2014 (“Opinion”) 65 (Dkt. #180, R.4434), quoting Ricci v. DeStefano, 557 U.S. 557, 582 (2009) (citing prior authority). Underlying the DBE program is a potential tension between the legitimate goal of encouraging increased participation for all DBEs (businesses that are 51% owned by persons who meet the definition of socially or economically disadvantaged) without violating the rules against generalized use of racial or other quotas. The issue presented by this case is likely to reoccur as state agencies, responding to political or other pressure, attempt to maximize the participation of women and minorities (who are generally presumed to be DBEs) in public works projects. The Opinion establishes an erroneous standard of review that would, if upheld, effectively eliminate meaningful judicial review of political manipulation of the DBE program by state agencies. The Opinion correctly notes that “[a]ll entities receiving funds from [the Federal Highway Administration] FHWA must have a DBE program which meets [federal] requirements,” and correctly described the “non-mandatory, non-exclusive and non- exhaustive actions” that may be used to determine if a contractor “took all Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 7. 4 necessary and reasonable steps to achieve a DBE goal. . .” Opinion 62-63 (Dkt. #180, R.4431-32). But then the district court went astray by misreading the leading decision in this Circuit, Northern Contracting, Inc. v. Illinois Dept. of Transp., 473 F.3d 715 (7th Cir. 2007), as stating the sole, and very limited, basis for review of DBE programs. The district court applied Northern Contracting even though that case arose in a very different context that does not exist here. Its ruling would effectively turn what should be strict scrutiny review into a deferential exercise of administrative agency review. The district court concluded that because the Illinois Department of Transportation (“IDOT”) complied with the federal guidelines for how a state agency should determine its DBE goal, a low bidder who lost a contract because it did not meet that goal could not challenge the loss on the ground that the state agency had converted the goal to an unlawful quota.1 Based on its reading of Northern Contracting, the Opinion described the scope of judicial review as follows: A state entity such as IDOT implementing a congressionally mandated program may rely "on the federal government's compelling interest in remedying the effects of past discrimination in the national construction market." . . . . In these instances, the state is acting as an agent of the federal government and is "insulated from this sort of constitutional attack, absent a showing that the state exceeded its federal authority." [Northern Contracting] . . . at 721. Accordingly, any "challenge to a state's application of federally mandated program must be limited to the question of whether the state exceeded its authority." 1 As amicus it is not the ARTBA’s role to say whether a fact-finder presented with the evidence Dunnet Bay assembled would find that DBE goals were converted to a minority quota. But as Dunnet Bay argues in its brief (Dunnet Bay Brief passim), the evidence was sufficient to permit a fact-finder to reach that conclusion. Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 8. 5 Id. at 722. Therefore, the Court must determine if IDOT exceeded its authority granted under the federal rules or if Dunnet Bay's challenge is foreclosed by Northern Contracting. [Opinion 65-66 (Dkt. #180, R.4434-35); (italics added).] The degree of deference afforded IDOT by the district court is evidenced by its apparent determination that even if its goals operated as a de facto quota, IDOT did not “exceed[] its authority” in refusing to award the Eisenhower Expressway project to Dunnet Bay Construction Company because “IDOT did in fact employ a thorough process before arriving at the [DBE goal] figure [of 22.2%].” It added: Additionally, because the federal regulations do not specify a procedure for arriving at contract goals, it is not apparent how IDOT could have exceeded its federal authority. Any challenge on this factor fails under Northern Contracting. [Opinion 67 (Dkt. #180, R.4436).] As amicus, ARTBA is concerned that under this standard judicial review is reduced to a deferential and mechanical determination focused solely upon whether an agency could document compliance with federal regulations, even in the face of significant evidence that a goal was applied as a quota. The district court appeared at times to slide from deferential review to no review at all, by stating “it is not apparent how IDOT could have exceeded its federal authority.” Opinion at 67 (Dkt. #180, R.4436).2 Dunnet Bay presented evidence that representatives of the office of the Governor of Illinois repeatedly stated that the DBE program was intended to increase 2 ARTBA’s concern is increased by the fact that the federal regulations only describe various non-exclusive “methods a recipient [of federal funds] may use to calculate DBE availability”, and thus do not provide definitive guidance even on how to calculate goals. Northern Contracting, Inc. v. Illinois, 473 F.3d 715, 718 (7th Cir. 2007). Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 9. 6 “minority” (not DBE) participation; the Governor’s office and IDOT officials publicly stated that there was a no-waiver policy for failing to meet the goals for minority participation (despite federal policy authorizing waivers); and the IDOT employee with direct responsibility for DBE compliance concluded that IDOT was violating the rules by manipulating the DBE guidelines. Opinion at 30-32, 34-36, 47-48, 50 and 52 (Dkt. #180, R.4399-4401, 4403-05, 4416-17, 4419 and 4421). Instead of reviewing that evidence to determine if Dunnet Bay’s facts generated an issue for trial on whether goals were treated as quotas, the district court concluded that because “the federal regulations do not specify a procedure for arriving at contract goals” IDOT could not have done anything wrong. Opinion at 67 (Dkt. #180, R.4436). That was a serious misapplication of Northern Contracting. Nothing in Northern Contracting remotely suggests such a limited scope of judicial review. In that case the Court confirmed that strict scrutiny was the appropriate standard. 473 F.3d at 720. But the plaintiff’s claim in that case differed significantly from the one Dunnet Bay presented in this case. In Northern Contracting, the plaintiff challenged whether IDOT had followed the applicable federal regulations in the three specific respects asserted by the plaintiff: failing to calculate correctly the available number of DBEs in Illinois, failing to adjust DBE goals for local market conditions, and failing to use race-neutral means to increase DBE participation by awarding contracts to DBEs other than under the DBE program. Id. at 722-23. Thus, the case was limited to whether IDOT followed the guidance provided by non-binding federal regulations, with no suggestion that Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 10. 7 quotas were involved. In Northern Contracting, the Court’s focus was solely on IDOT’s application of federal regulations. The case presented a straightforward review of federal regulations and their application by a state agency. This case is different. The facts presented by Dunnet Bay, if proven, would establish that IDOT had imposed a quota system. Thus, even if review is “limited to the question of whether the state exceeded its authority,” Northern Contracting, 473 F.3d at 722, the quota evidence answers that question in the affirmative. If there was a quota, the state necessarily “exceeded its authority,” regardless of any superficial showing of compliance with the regulations. Moreover, unlike Northern Contracting, the dispute in this case is not over whether “the state [did] exactly what the [federal] statute expects it to do.” Dunnet Bay was not attempting “collaterally [to] attack the federal regulations through a challenge to IDOT’s program.” Northern Contracting, 473 F.3d at 721-22. Dunnet Bay did not allege that IDOT misapplied specific federal regulations by using the wrong data, for example, to create a DBE goal. Rather, it alleged that the Governor’s office directed IDOT to apply the DBE goals for the Eisenhower Expressway contract as an illegal minority quota, with no waivers and no tolerance for failing to reach the goal. Once substantial evidence was presented of an unlawful quota system, judicial scrutiny was required to be strict and searching. The district court should not have limited itself to the federal regulatory guidance, but instead should have closely reviewed the evidence of the de facto quota system. Had it done so, it seems very likely that it would have found that a genuine issue of Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 11. 8 fact exists as to whether IDOT created a quota, which federal law prohibits absent special circumstances. Rather than deferring to a state agency’s application of federal regulations as the limit of its review, the district court should have focused on whether there was enough evidence presented by Dunnet Bay to generate a triable issue as to whether the minority participation goals, as applied by the Governor and IDOT, were effectively a quota. Unfortunately, the district court misapplied Northern Contracting to allow review only on a deferential standard to determine if IDOT “exceeded authority” under non-binding federal guidelines. It also appears to have allowed that standard to control or influence its determination whether IDOT had adopted an impermissible policy against waivers of DBE goals. See Opinion at 69 (Dkt. #180, R.4438) (“IDOT did not exceed its federal authority by adopting a no-waiver policy”). A less deferential standard of review could have led it to conclude that a material factual dispute exists on the quota claim, including whether IDOT effectively employed a no-waiver policy as a means of implementing the quota. ARTBA’s members, from time to time, litigate disputes with state agencies that administer federal-aid construction contracts subject to DBE guidelines. The approach that the district court took to judicial review of such disputes, if affirmed, will harm members of ARTBA and others who engage in such litigation by denying meaningful review of serious allegations, and relegating the judicial function to evaluating technical compliance with non-binding federal guidelines, while Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 12. 9 disregarding evidence that the “goals” were being manipulated to implement unlawful quotas. 2. The Opinion erodes the federal policy permitting waivers for contractors who make “good faith efforts” to meet DBE goals. ARTBA members often bid as prime contractors on federal-aid transportation construction projects. The federal rules for administration of the DBE program recognize that, for legitimate market reasons, these prime contractors will not always be able to meet DBE goals when bidding on projects. Prime contractors in these situations are to provide documentation of their good faith efforts to meet the goal and request a waiver from the state or local transportation agency in question. There are federal guidelines addressing this waiver-granting process, although, as noted, they are non-exclusive. Waivers are a necessary part of the federal program requiring DBE participation because of basic market realities. Within some geographic areas, there are in fact not enough certified and available DBE firms, or an inadequate number of such firms qualified and available to perform certain subcontracting disciplines needed for a particular construction project. As administered by a state or local transportation agency, a waiver process must be as objective and transparent as possible. As participants in competitive bidding for a contract, ARTBA’s members have a great interest in “playing by the same set of rules.” A subjective or mysterious process for granting a good faith effort waiver severely undermines that principle. Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 13. 10 ARTBA’s members also pride themselves on providing maximum value for their bids, which greatly benefits the project’s public owner-agency and the taxpayers. To do so, prime contractors require as much certainty as possible in the bidding process, including the prices of their subcontractors’ bids and the manner in which public agencies will administer compliance for programs like DBE participation. A prime contractor will interpret uncertainty in the waiver process as added risk and therefore increase the overall price of its bid. Ultimately this will lead to more expensive projects and less value for the taxpayers. Even more importantly, a no-waiver rule also turns a goal-based DBE program into a de facto quota. Consistent and fair administration of legally-proper waiver principles is, therefore, important to ARTBA’s members. In the face of substantial evidence to the contrary presented by Dunnet Bay, the district court concluded that IDOT had neither a no-waiver policy nor a waiver policy that was so difficult to meet that it operated as a de facto quota. The district court granted IDOT summary judgment on the waiver issue. In reaching that conclusion the district court appears to have mixed the question whether IDOT applied a quota to Dunnet Bay’s bid with whether IDOT applied a quota to other contractors on separate contracts. The district court resolved the issue factually by concluding that because IDOT granted waivers to other contractors, it did not apply a quota to Dunnet Bay. Opinion 68-69 (Dkt. #180, R.4437-38). 3 Dunnet Bay 3 It is important to note that the waiver the district court refers to was not granted until March 4, 2010, after Dunnet Bay filed this case (Dkt. #1, R.25) and IDOT had appeared (no Docket #, R.271). Opinion 69 (Dkt. #180, R.4438). In Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 14. 11 discusses the evidence on the no-waiver issue and whether that evidence generated a fact issue for trial. See Dunnet Bay Brief at 40-41. As amicus it would not be appropriate for ARTBA to argue what the evidence showed. ARTBA is concerned, however, that the district court’s treatment of the no- waiver policy, including IDOT’s internal review of the issue, applied an erroneous standard of review that, if affirmed, will adversely affect ARTBA members who may seek judicial review of decisions by government agencies to deny waivers of DBE goals. Essentially, the district court deferred to IDOT’s internal review of the waiver request when Dunnet Bay requested reconsideration of denial of the contract. The district court deferred to William Grunloh, IDOT’s internal reviewer: “. . . a reconsideration officer such as Grunloh has significant discretion and will often be called on to make a ‘judgment call’ regarding the efforts of the bidder. “The Court is unable to conclude that Bill Grunloh erred in determining Dunnet Bay did not make adequate good faith efforts.” Opinion 72 (Dkt. #180, R.4441). The district court so found despite substantial evidence from which a fact-finder could conclude that a waiver should have been granted if there was not a quota. That evidence included: (a) Dunnet Bay, the low bidder, had (i) solicited hundreds of DBEs via faxes and phone calls, (ii) attended pre-bid meetings designed to provide outreach to DBEs, (iii) contacted appropriate addition, the waiver was not on the contract on which Dunnet Bay had bid. Opinion 69 (Dkt. #180, R.4438). Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 15. 12 minority and female organizations, and (iv) had a track record of generating substantial DBE participation. (b) Both IDOT and the court recognized that Dunnet Bay’s DBE outreach efforts may have been impeded by IDOT’s failure to list Dunnet Bay as a qualified bidder, thus discouraging DBE firms from responding when Dunnet Bay sought DBE subcontractors. (c) Dunnet Bay received ten quotes from DBE subcontractors shortly after the bid opening on January 15, 2010; at least one of those bids arrived late as a direct result of IDOT’s failure to list Dunnet Bay; if Dunnet Bay had received those DBE subcontractor quotes earlier, it would have almost tripled its DBE utilization. See Opinion 19-20, 26 (Dkt. #180, R.4388-89, 4395). Despite these facts and others, the district court upheld IDOT’s internal review of the decision not to grant a waiver by applying the following reasoning: The [federal] regulations refer to eight non-exhaustive factors which can be considered in assessing good faith. . . . The factors to be considered are non-mandatory, non-exhaustive and nonexclusive. A contractor who does not meet the goals "must show that it took all necessary and reasonable steps to achieve a DBE goal." 49 C.F.R. § Pt. 26 App. A. Based on this standard, a reconsideration officer such as [IDOT’s William] Grunloh has significant discretion and will often be called on to make a "judgment call" regarding the efforts of the bidder. Accordingly, it is not surprising that another IDOT official might disagree with the decision. The Court is unable to conclude that Bill Grunloh erred in determining Dunnet Bay did not make adequate good faith efforts. Perhaps the strongest evidence that Dunnet Bay did not take "all necessary and reasonable steps to achieve a DBE goal" is that its DBE participation was under 9% while other bidders were able to reach the 22% goal. Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 16. 13 Accordingly, the Court concludes that IDOT's decision on reconsideration of the rejection of Dunnet Bay's bid was consistent with the regulations and did not exceed IDOT's authority under federal law. [Opinion 71-72 (Dkt. #180, R.4440-41); italics added.] The district court entirely missed the point of Dunnet Bay’s evidence. If affirmed, its reasoning would permit a state agency to treat DBE project goals as quotas so long as another bidder met the quota and the agency employed an internal review procedure through which the agency’s reviewing officer was given “significant discretion” to make a “judgment call” and rejected the complaining contractor’s waiver request. If district courts review allegations that a state agency has used an illegal quota by deferential review of the agency’s internal reconsideration process, the strict scrutiny standard mandated by the Supreme Court in Adarand Constructors, Inc. v. Penna, 515 U.S. 200 (1995), and applied by this Court in Northern Contracting will have been eliminated.4 The district court’s reasoning is wrong for several reasons. First, the extent to which Dunnet Bay took advantage of eight federally-approved but non-binding techniques to recruit DBE firms, or others of its own invention, to line up DBE firms is a different issue than whether IDOT administered the DBE program as a quota. If the fact-finder accepts Dunnet Bay’s evidence on that issue to explain why Dunnet Bay, the low bidder, did not get the contract, then Dunnet Bay’s good faith 4 As the Supreme Court recently stated, “[s]trict scrutiny is a searching examination, and [it is] the government [that] bears the burden to prove that the reasons for any racial classification are clearly identified and unquestionably legitimate.” Fisher v. Univ. of Texas at Austin, 133 S. Ct. 2411, 2419 (2013) (citations and quotations omitted). Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 17. 14 efforts or lack thereof would not change the fact that the program was being operated as a quota. At the very least Dunnet Bay should be entitled to try to prove to the fact-finder that under IDOT’s normal waiver practice it would have received the waiver, and the contract. Second, in the face of significant evidence that IDOT implemented a quota, the district court should not have evaluated the agency’s reconsideration decision by treating it as subject to “significant [agency] discretion” and to limit its inquiry to whether “the rejection of Dunnet Bay's bid was consistent with the regulations . . .” The correct approach would have been to resolve Dunnet Bay’s claim that IDOT implemented the DBE program as a quota applying strict scrutiny, and only if that claim were rejected should the agency’s internal decision be reviewed to determine if Dunnet Bay did not make good faith efforts to recruit more DBEs. Moreover, Dunnet Bay presented evidence to support its argument that the reconsideration process was part of quota implementation. As the court noted, at Opinion 27 (Dkt. #180, R.4396), Ms. Lyle, IDOT’s DBE compliance expert, recommended after the reconsideration hearing that Dunnet Bay receive the waiver and the contract. In these circumstances it was wrong to evaluate the waiver as if the only question was whether the reconsideration officer abused his discretion. ARTBA is also concerned with the consequences of the court’s third, and apparently principal, reason for validating IDOT’s denial of a waiver – its conclusion that the effectiveness of the DBE outreach goal was shown by the fact that Dunnet Bay reached only 9% DBE participation while other bidders (and Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 18. 15 Dunnet Bay on the rebid) reached 22%. In this case, the fact that a 22% “goal” was achieved following public statements by IDOT and the Governor’s office that there would be no waivers, and following the rejection of Dunnet Bay’s low bid for failing to reach 22%, is fully consistent with the conclusion that everyone understood that a quota was being applied and bidders had to meet the quota, whether lawful or not. ARTBA is concerned that affirmance of the Opinion would set a bad precedent by allowing an agency to insist on meeting a DBE “goal” and then asserting that because the goal was met it proves the reasonableness of the goal, as opposed to proving that the goal was really a quota. 3. The Opinion applies an erroneous test of standing that denies a contractor required to implement a quota system the right to challenge the quota on equal protection grounds. An issue of great concern to ARTBA and its members is that the Opinion effectively eliminates standing for prime contractor-members who are required to engage in unlawful discrimination at the subcontractor level in order to prevent rejection of their otherwise-qualifying bids. The standing issue should have been straightforward. Dunnet Bay was the low bidder for a $10 million contract. It alleged, and presented evidence, that IDOT rejected its bid because of a DBE quota. It alleged that but for the allegedly unlawful quota, it would have been awarded the contract. Therefore, it alleged a $10 million harm directly caused by the application of an unconstitutional quota. Standing is clear under controlling case law, and as a matter of common sense. In Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 19. 16 Northeastern Florida Chapter of Associated General Contractors of America v. City of Jacksonville, Florida, 508 U.S. 656, 663 (1993), the Supreme Court held: The doctrine of standing is "an essential and unchanging part of the case-or-controversy requirement of Article III," . . . . It has been established by a long line of cases that a party seeking to invoke a federal court's jurisdiction must demonstrate three things: (1) "injury in fact," by which we mean an invasion of a legally protected interest that is "(a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical," . . . .; (2) a causal relationship between the injury and the challenged conduct, by which we mean that the injury "fairly can be traced to the challenged action of the defendant," and has not resulted "from the independent action of some third party not before the court," . . . .; and (3) a likelihood that the injury will be redressed by a favorable decision, by which we mean that the "prospect of obtaining relief from the injury as a result of a favorable ruling" is not "too speculative," . . . [internal citations omitted.] Dunnet Bay alleged all three elements. It alleged that it would have been awarded a specific contract but for IDOT’s quota. (Dkt. #1, R.33). It also alleged: . . . [i]n that IDOT’s no-waiver policy results in a rejection of any bid as non-responsive that fails to meet the contract goal despite evidence of a bidder’s good faith efforts to do so, the 22% contract goal constitutes an unlawful quota. [Dkt. #1, R.33.] Dunnet Bay thus alleged a direct, concrete and particularized injury to it as a result of a racial quota in the form of its loss of a $10 million contract. In the language of Northeastern Florida, that was an “injury in fact” that was “causally connected” to the quota; and it would “be redressed by a favorable decision.” Its allegations met all the standing requirements specified by the Supreme Court. That should have been the end of the matter. Nevertheless, the district court held that Dunnet Bay lacked standing to complain. This Court should correct that error. Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 20. 17 The district court went astray by misreading standing doctrine. It muddled concepts of discrimination (which go to the merits) with concepts of injury (which go to standing). The Opinion asserts that because IDOT did not treat Dunnet Bay differently than the other contractors it was bidding against, it suffered no competitive disadvantage in relation to its peers, which thereby defeated standing. Opinion 74-75 (Dkt. #180, R.4443-44). But that is a merits argument (and a wrong one), not a standing argument. Standing is clear under Northeastern Florida (and many other cases) because the three elements of injury, causation and redressability are met. Although labeling its analysis as a standing inquiry, the district court essentially found instead that no equal protection violation could have occurred because Dunnet Bay and its competitors all operated under the same standard. That cannot be correct where the standard itself is unconstitutional. A hypothetical illustrates the point. Assume two contractors bid on a State contract. The State erects an unconstitutional rule: it requires the contractors to discriminate by engaging at least 22% minority subcontractors even though that level of participation is not supported by market-based evidence. Contractor A is low bidder but loses out to Contractor B because it did not meet the target. Under the district court’s logic, no equal protection violation occurred because both contractors were forced to play under the same rules, and Contractor B had no “competitive advantage” over Contractor A. That is incorrect. Rigging the game with an illegal rule constitutes the equal protection violation, regardless of whether Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 21. 18 all compete on equal footing under that unlawful standard. The rule divides the competitors into two classes: those willing and able to clear the illegal hurdle, and those not. The injury (and, hence standing) results from the application of the illegal hurdle to deprive Contractor A (Dunnet Bay) of the contract. In reaching the contrary conclusion, the district court erroneously concluded that “unequal footing” was the only means to establish standing. But that is only one way to do so. One can also establish standing where there is equal footing under an unequal standard. In Adarand Constructors, Inc., and Northeastern Florida, supra, the Supreme Court held that a contractor may show standing based on an “inability to compete on an equal footing in the bidding process, . . . .” Those cases did not purport, however, to define the only road to standing. Northeastern Florida’s discussion of Warth v. Seldin, 422 U.S. 490 (1975), made that clear. In language that applies here, the Court stated that “[a]n allegation that a ‘specific project’ was ‘precluded’ by the existence of or administration of [a program], would certainly have been sufficient to establish standing.” 508 U.S. at 668. The Court made that statement in distinguishing Warth, where it had found no standing for contractors to object to a town’s zoning ordinance that prevented people of low and moderate income from living in the town. In Warth, the Court based the lack of standing upon the fact that the contractors failed to identify any contract that was lost. Warth was otherwise factually similar to this case: in both cases the contractors were complaining that the government’s policy effected discrimination against someone other than the contractor-plaintiffs. Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 22. 19 The Supreme Court recognized in Northeastern Florida that the contractor- plaintiffs in Warth would have had standing if they had alleged “that a ‘specific project’ was ‘precluded’ by the existence of or administration” of the Town’s zoning policy. The Court thereby answered the standing issue here. Dunnet Bay clearly alleged that it lost the Eisenhower Expressway contract because IDOT converted a goal into a quota that it could not meet. Under Northeastern Florida’s discussion of Warth, that afforded standing for Dunnet Bay. To conclude otherwise would eliminate any remedy for a contractor when a government program requires the contractor to discriminate on the basis of race in awarding subcontracts. Such a standing rule would make no sense and would frustrate the anti-discrimination policies of the law and adversely affect ARTBA’s members. Contrary to the Opinion at 74-75 (Dkt. #180, R.4443-44), the fact that Dunnet Bay itself was not singled out because of the race of its owners, or that of its competitors, defeats neither standing nor an equal protection claim. It suffered injury in fact as a result of an unconstitutional minority-based quota. The State engaged in discrimination and Dunnet Bay lost a contract as a result. Under the Northeastern Florida-Warth analysis, that is sufficient to establish standing even though the race of Dunnet Bay’s and its competitors’ owners was not a factor in the decision. Dunnet Bay’s injury was not limited to the loss of the contract (although that loss was certainly sufficient to create standing). A corollary of the point made above (about the rules of the game being unlawful) is that the unlawful rules force Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 23. 20 one to violate the law in order to compete against other bidders. Dunnet Bay was, therefore, also injured because the quota system forces contractors into a Hobson’s choice: either become party to unlawful discrimination or lose your chance for a contract. Dunnet Bay essentially complained that because of IDOT’s de facto quota it would have had to engage in discrimination itself in favor of some subcontractors and against others on the basis of minority status to get the Eisenhower Expressway contract. Courts have found standing where a government program requires a contractor to discriminate, or attempt to discriminate, against others. In Monterey Mechanical Co. v. Wilson, 125 F.3d 702, 707 (9th Cir. 1997), the court stated: Even if a general contractor suffers no discrimination itself, it is hurt by a law requiring it to discriminate, or try to discriminate, against others, on the basis of their ethnicity or sex. A person required by the government to discriminate by ethnicity or sex against others has standing to challenge the validity of the requirement, even though the government does not discriminate against him. That standard fits squarely to the facts alleged here: Assume that IDOT’s quota did not discriminate against Dunnet Bay on the basis of its owners’ race or ethnicity, as the district court concluded (erroneously, as discussed below). Nonetheless, by denying Dunnet Bay standing the district court denied Dunnet Bay the opportunity to prove that IDOT required it to discriminate against non-minority subcontractors. Dunnet Bay has standing to challenge the quota under Monterey Mechanical Co., supra. The district court was wrong to conclude otherwise. Under its approach, prime contractors could never challenge government programs that require them to Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 24. 21 use quotas to select subcontractors, unless they could prove they were directly competing against a minority prime contractor. Because many ARTBA members regularly bid for contracts and must select subcontractors for appropriate portions of their work, they would suffer serious harm – lack of standing to sue – if the district court’s reasoning were affirmed. Even reading the standing requirement as the district court did – to require direct competition by Dunnet Bay with DBE firms – Dunnet Bay’s allegations should have afforded it standing. As the district court assumed (Opinion at 76, Dkt. #180, R.4445), IDOT permitted general contractors that were DBEs to take advantage of their status by performing a portion of the work directly. As a non- DBE business, Dunnet Bay could not do the same and have it count as DBE work. Thus, IDOT deprived Dunnet Bay of the right to compete for the contract on equal footing with DBE prime contractors. See, e.g., W.H. Scott Constr. Co. v. City of Jackson, 199 F.3d 206, 215-16 (5th Cir. 1999) (contractor denied the right to compete on equal footing, and thus had standing to sue, where program permitted DBE-qualified general contractor to use its own work to satisfy minority participation goals and avoid good faith requirements). The district court recognized this fact: “It is true that a hypothetical DBE might not have had to subcontract work on the Eisenhower project, thereby providing it with a competitive advantage over the other bidders.” But the district court rejected the argument, stating that “Dunnet Bay has not pointed to another Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 25. 22 contractor that did not have to meet the same requirements it did.” Opinion at 76 (Dkt. #180, R.4445). Dunnet Bay was not required to prove that there was another contractor who benefited from the challenged quota. For standing purposes, if an unlawful practice or policy imposes a loss on the plaintiff, the plaintiff is not also required to show who won from its loss, so long as it has a plausible basis to allege that it was the loser. As the Court stated in Northeastern Florida: When the government erects a barrier that makes it more difficult for members of one group to obtain a benefit than it is for another group, a member of the former group seeking to challenge the barrier need not allege that he would have obtained the benefit but for the barrier to establish standing. The “injury in fact” in an equal protection case of this variety is the denial of equal treatment resulting from the imposition of the barrier, not the ultimate inability to obtain the benefit. 508 U.S. at 666 [italics added]. Thus, both under Monterey Mechanical Co., which recognizes a contractor’s standing to object when a government program requires it to discriminate among subcontractors, and under Northeastern Florida, Dunnet Bay had standing. Respectfully submitted, American Road and Transportation Builders Association By: s/ Thomas M. Staunton One of its attorneys Dated: June 9, 2014 Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 26. 23 Nick Goldstein Assistant General Counsel American Road & Transportation Builders Association 1219 28th Street NW Washington, DC 20007 (202) 289-4434 Michael L. Shakman Edward W. Feldman Thomas M. Staunton Miller Shakman & Beem LLP 180 N. LaSalle Street Chicago, Illinois 60601 mlshak@aol.com efeldman@millershakman.com tstaunton@millershakman.com 312-363-3700 Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 27. 24 CERTIFICATE OF COMPLIANCE WITH FEDERAL RULE OF APPELLATE PROCEDURE 32 This brief complies with the type-volume limitation of Fed. R. App. P. 32(a)(7)(B) because this brief contains 6,402 words, excluding the parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii). This brief complies with the typeface requirements of Fed. R. App. P. 32(a)(5), as modified by Seventh Circuit Rule 32(b), and the type style requirements of Fed. R. App. P. 32(a)(6) because this brief has been prepared in a proportionally spaced typeface using Microsoft Office Word 2010 in 12 point Century Schoolbook plain, roman style font. American Road and Transportation Builders Association By: s/ Thomas M. Staunton One of its attorneys Dated: June 9, 2014 Nick Goldstein Assistant General Counsel American Road & Transportation Builders Association 1219 28th Street NW Washington, DC 20007 (202) 289-4434 Michael L. Shakman Edward W. Feldman Thomas M. Staunton Miller Shakman & Beem LLP 180 N. LaSalle Street Chicago, Illinois 60601 mlshak@aol.com efeldman@millershakman.com tstaunton@millershakman.com 312-363-3700 Attorneys for American Road and Transportation Builders Association Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28
  • 28. 25 CERTIFICATE OF SERVICE I hereby certify that on June 9, 2014, I caused the foregoing to be electronically filed with the Clerk of the Court for the United States Court of Appeals for the Seventh Circuit by using the CM/ECF system. I certify that all participants in the case are registered CM/ECF users and that service will be accomplished by the CM/ECF system. American Road and Transportation Builders Association By: s/ Thomas M. Staunton One of its attorneys Dated: June 9, 2014 Nick Goldstein Assistant General Counsel American Road & Transportation Builders Association 1219 28th Street NW Washington, DC 20007 (202) 289-4434 Michael L. Shakman Edward W. Feldman Thomas M. Staunton Miller Shakman & Beem LLP 180 N. LaSalle Street Chicago, Illinois 60601 mlshak@aol.com efeldman@millershakman.com tstaunton@millershakman.com 312-363-3700 Case: 14-1493 Document: 14 Filed: 06/09/2014 Pages: 28