Federal-state Programs and State-or Is it Federal?-action

• Publication year: 2022

54 Creighton L. Rev. 203. FEDERAL-STATE PROGRAMS AND STATE-OR IS IT FEDERAL?-ACTION

FEDERAL-STATE PROGRAMS AND STATE-OR IS IT FEDERAL?-ACTION

MICHAEL E. ROSMAN ^[D1]

Modern governmental programs increasingly involve government action that can be traced in some way to both the federal government and a state or local government. In the simplest situation, the federal government passes a law regulating the state, such as federal employment provisions that prohibit state employers from discriminating on the basis of prohibited criteria. ^[1] Slightly more complicated is the situation where the federal government, through its spending power, offers state or local governments money in exchange for the state or local government promising to follow certain rules.

What if a private citizen wants to challenge the government action resulting from one of these situations as unconstitutional or otherwise illegal? Who, exactly, is responsible for the action, and who should be sued? And have those defendants specifically violated a provision of the Bill of Rights (deemed applicable only to the federal government or action taken under color of federal law) or the Fourteenth Amendment (generally incorporating the Bill of Rights and deemed applicable to actions taken under color of state authority)? Can the same governmental action be said to have been taken under both color of state authority and color of federal authority?

These questions do not admit of easy answers, and the United States Supreme Court has not tried. Indeed, the Court has suggested that state conduct taken in order to comply with a federal statute might be immune from constitutional attack, a result that would certainly be counterintuitive. ^[2] Lower courts, on the other hand, have tried to determine whether the officials (be they state or federal) were acting under color of state authority or color of federal authority. These phrases-and the occasional citation of authority-seem to be taken from "state action" doctrine. In "state action" cases, or in cases involving the federal government which might be called "federal action" cases, courts try to determine whether the actions of individuals who appear to be private citizens or organizations are attributable to a government.

But there are several problems. First, "state action" cases involving apparently private individuals or organizations are not entirely clear. Second, the cases involving some combination of federal and state action, albeit using the language of the cases involving private persons and entities (like "color of state authority") do not appear to be following them with great rigor. Indeed, it is often difficult to tell what they are doing.

Getting it right, or at least understanding what the courts are doing, matters. In some contexts, the "who is responsible" question might determine whether a statute like 42 U.S.C § 1983 ^[3] ("Section 1983") (which applies only to action taken under color of state authority) is applicable and to what kind of relief the plaintiff is entitled. ^[4]

Part I of this Article lays out general principles of "state action" in instances where a private person or entity is said to have acted under color of state (or federal) authority. Part II identifies various challenges to governmental conduct that courts have addressed where both the federal and state government could reasonably be said to have been responsible in part for that action. Part III focuses more closely on anti-discrimination cases where this is true and the inscrutable "collateral attack" doctrine that has arisen in that area. Part IV suggests possible rationales for the seeming divergence between the usual "state action" principles and their application to federal-state programs and possible alternative approaches.

I

In general, public officials or employees acting in their official capacities are acting under color of governmental authority. ^[5] There might occasionally be a rare exception to this rule, ^[6] and there might be one or two cases where the nature of an entity might be ambiguous, ^[7] but, for the most part, federal officials will be deemed to act under color of federal authority and state officials under color of state authority.

Trickier questions come into play when a plaintiff claims that a private person or entity acted under color of governmental authority. The Court has identified a whole series of "tests" that it utilizes to determine whether a private party's actions are properly attributed to a government, all of which are designed to determine whether "seemingly private behavior 'may be fairly treated as that of the State itself.'" ^[8] Indeed, the United States Court of Appeals for Ninth Circuit has claimed that the Supreme Court has seven different tests for determining state action, ^[9] although the Supreme Court's most recent opinion identified only three examples. ^[10] Whatever the actual number, the Court itself has emphasized that the entire area requires substantial examination of the specific facts of each case, the ultimate aim of which is to ascertain whether seemingly private conduct is properly attributable to a government. ^[11]

Several of the tests are of interest to us here. First, private conduct can be attributed to the government when the government either has used its coercive power to require, or provided strong encouragement to induce, the ostensibly private conduct that is said to violate a third party's rights. ^[12] Although this is a commonly-repeated test, there are remarkably few Supreme Court cases that actually have applied it to uphold a claim of state action against a private person who was explicitly required by state law to engage in some conduct, and one circuit has expressed skepticism about the literal application of the test. ^[13] In Adickes v. S.H. Kress & Co., ^[14] the Court held that a restaurant would engage in "state action" in refusing service to minorities if its policy emanated from a state-enforced custom of segregation, which the Court analogized to a state statute requiring such segregation. ^[15] While this might seem counterintuitive-to hold a private party or entity liable simply for obeying a state or federal law or custom-the Court has never pulled back from this holding. Indeed, a state need not even require the private conduct in question; if the state provides "strong encouragement" to private action, that too can transform private conduct into state action. ^[16] Thus, in Reitman v. Mulkey, ^[17] which may be an extreme example of this phenomenon, the Court held that a state constitutional amendment, passed by initiative, that prohibited the state from denying any person's right to decline or sell residential real property as he chose was a violation of the Equal Protection Clause because it "involved" the state in private landlords' decisions to engage in racial discrimination. ^[18] The case, though, came to the Supreme Court from a series of state court cases in which plaintiffs alleged race discrimination against private landlords under prior California law; the private landlords were defendants using the initiative as a defense to the claims.

Of course, the "encouragement" process does not work in reverse, at least not usually. That is, the fact that a private person or entity encouraged the state to engage in a particular course of conduct does not render that conduct "private." Thus, in National Collegiate Athletic Assn. v. Tarkanian, ^[19] a private entity, the National Collegiate Athletic Association ("NCAA") pressured a public university, University of Nevada at Las Vegas ("UNLV") to demote Tarkanian (the school's basketball coach) for various violations of NCAA rules. ^[20] The question in Tarkanian was whether the NCAA acted under color of state authority, and the Court answered "no." ^[21] But there was no question that UNLV was a state actor, despite it being pressured by a private entity. ^[22] Indeed, UNLV was a defendant in the state court lawsuit, and the state court had issued an injunction (and attorneys' fees) against UNLV that it did not appeal. ^[23] And UNLV was deemed a state actor despite the fact that "[i]t would [have been] more appropriate to conclude that UNLV has conducted its athletic program under color of the policies adopted by the NCAA, rather than that those policies were developed and enforced under color of Nevada law." ^[24]

There is some not-very-clear point at which the private conduct goes from merely setting guidelines for state entities to follow or applying pressure to adopt and apply those guidelines and becomes "joint conduct" with the state entity-and at that point the private party's conduct can indeed be "state action." In Dennis v. Sparks, ^[25] a plaintiff alleged that a private party had engaged in an improper agreement that resulted in a judge issuing an injunction against the plaintiff precluding him from the production of minerals from oil leases he owned. Even though it was the judge that issued the injunction (later dissolved on appeal), the private party was nonetheless deemed to have acted under color of state authority. ^[26] The four dissenting judges in Tarkanian viewed Dennis as analogous, but the five in the majority disagreed. ^[27]

It is often said that the principles of "state action" apply equally to the federal government. ^[28] This is fine when the issue is whether a private person or entity acted under color...