U.S. Supreme Court

ADARAND CONSTRUCTORS, INC. v. PENA
515 U. S. 200 (1995)

Decided June 12, 1995

JUSTICE O'CONNOR announced the judgment of the Court and delivered an opinion with respect to Parts I, II, III-A, III-B, III-D, and IV, which is for the Court except insofar as it might be inconsistent with the views expressed in JUSTICE SCALIA'S concurrence, and an opinion with respect to Part III-C in which JUSTICE KENNEDY joins.

Petitioner Adarand Constructors, Inc., claims that the Federal Government's practice of giving general contractors on government projects a financial incentive to hire subcontractors controlled by "socially and economically disadvantaged individuals," and in particular, the Government's use of race-based presumptions in identifying such individuals, violates the equal protection component of the Fifth Amendment's Due Process Clause....

In 1989, the Central Federal Lands Highway Division (CFLHD), which is part of the United States Department of Transportation (DOT), awarded the prime contract for a highway construction project in Colorado to Mountain Gravel & Construction Company. Mountain Gravel then solicited bids from subcontractors for the guardrail portion of the contract. Adarand, a Colorado-based highway construction company specializing in guardrail work, submitted the low bid. Gonzales Construction Company also submitted a bid.

The prime contract's terms provide that Mountain Gravel would receive additional compensation if it hired subcontractors certified as small businesses controlled by "socially and economically disadvantaged individuals." Gonzales is certified as such a business; Adarand is not. Mountain Gravel awarded the subcontract to Gonzales, despite Adarand's low bid, and Mountain Gravel's Chief Estimator has submitted an affidavit stating that Mountain Gravel would have accepted Adarand's bid, had it not been for the additional payment it received by hiring Gonzales instead. Federal law requires that a subcontracting clause similar to the one used here must appear in most federal agency contracts, and it also requires the clause to state that "[t]he contractor shall presume that socially and economically disadvantaged individuals include Black Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, and other minorities, or any other individual found to be disadvantaged by the [Small Business] Administration pursuant to section 8(a) of the Small Business Act."  Adarand claims that the presumption set forth in that statute discriminates on the basis of race in violation of the Federal Government's Fifth Amendment obligation not to deny anyone equal protection of the laws....

The Government urges that "[t]he Subcontracting Compensation Clause program is . . . a program based on disadvantage, not on race," and thus that it is subject only to "the most relaxed judicial scrutiny." To the extent that the statutes and regulations involved in this case are race neutral, we agree. The Government concedes, however, that "the race-based rebuttable presumption used in some certification determinations under the Subcontracting Compensation Clause" is subject to some heightened level of scrutiny.  The parties disagree as to what that level should be. (We note, incidentally, that this case concerns only classifications based explicitly on race, and presents none of the additional difficulties posed by laws that, although facially race neutral, result in racially disproportionate impact and are motivated by a racially discriminatory purpose. See generally Arlington Heights v. Metropolitan Housing Development Corp.(1977); Washington v. Davis (1976).)

Adarand's claim arises under the Fifth Amendment to the Constitution, which provides that "No person shall . . . be deprived of life, liberty, or property, without due process of law." Although this Court has always understood that Clause to provide some measure of protection against arbitrary treatment by the Federal Government, it is not as explicit a guarantee of equal treatment as the Fourteenth Amendment, which provides that "No State shall . . . deny to any person within its jurisdiction the equal protection of the laws" (emphasis added). Our cases have accorded varying degrees of significance to the difference in the language of those two Clauses....

The Court's failure to produce a majority opinion in Bakke, Fullilove, and Wygant left unresolved the proper analysis for remedial race-based governmental action....The Court resolved the issue, at least in part, in 1989. Richmond v. J. A. Croson Co.,(1989), concerned a city's determination that 30% of its contracting work should go to minority-owned businesses. A majority of the Court in Croson held that "the standard of review under the Equal Protection Clause is not dependent on the race of those burdened or benefited by a particular classification," and that the single standard of review for racial classifications should be "strict scrutiny."  With Croson, the Court finally agreed that the Fourteenth Amendment requires strict scrutiny of all race-based action by state and local governments. But Croson of course had no occasion to declare what standard of review the Fifth Amendment requires for such action taken by the Federal Government....

A year later, however, the Court took a surprising turn. Metro Broadcasting, Inc. v. FCC, 497 U.S. 547 (1990), involved a Fifth Amendment challenge to two race-based policies of the Federal Communications Commission. In Metro Broadcasting, the Court repudiated the long-held notion that "it would be unthinkable that the same Constitution would impose a lesser duty on the Federal Government" than it does on a State to afford equal protection of the laws. It did so by holding that "benign" federal racial classifications need only satisfy intermediate scrutiny, even though Croson had recently concluded that such classifications enacted by a State must satisfy strict scrutiny. "[B]enign" federal racial classifications, the Court said," - even if those measures are not `remedial' in the sense of being designed to compensate victims of past governmental or societal discrimination - are constitutionally permissible to the extent that they serve important governmental objectives within the power of Congress and are substantially related to achievement of those objectives." The Court did not explain how to tell whether a racial classification should be deemed "benign," other than to express "confiden[ce] that an `examination of the legislative scheme and its history' will separate benign measures from other types of racial classifications." Applying this test, the Court...upheld the policies.

By adopting intermediate scrutiny as the standard of review for congressionally mandated "benign" racial classifications, Metro Broadcasting departed from prior cases in two significant respects. First, it turned its back on Croson's explanation of why strict scrutiny of all governmental racial classifications is essential: "Absent searching judicial inquiry into the justification for such race-based measures, there is simply no way of determining what classifications are `benign' or `remedial' and what classifications are in fact motivated by illegitimate notions of racial inferiority or simple racial politics. Indeed, the purpose of strict scrutiny is to `smoke out' illegitimate uses of race by assuring that the legislative body is pursuing a goal important enough to warrant use of a highly suspect tool. The test also ensures that the means chosen `fit' this compelling goal so closely that there is little or no possibility that the motive for the classification was illegitimate racial prejudice or stereotype."

We adhere to that view today, despite the surface appeal of holding "benign" racial classifications to a lower standard, because "it may not always be clear that a so-called preference is in fact benign."  "[M]ore than good motives should be required when government seeks to allocate its resources by way of an explicit racial classification system."

Second, Metro Broadcasting squarely rejected one of the three propositions established by the Court's earlier equal protection cases, namely, congruence between the standards applicable to federal and state racial classifications, and in so doing also undermined the other two skepticism of all racial classifications, and consistency of treatment irrespective of the race of the burdened or benefited group....

"[A] free people whose institutions are founded upon the doctrine of equality," ibid., should tolerate no retreat from the principle that government may treat people differently because of their race only for the most compelling reasons. Accordingly, we hold today that all racial classifications, imposed by whatever federal, state, or local governmental actor, must be analyzed by a reviewing court under strict scrutiny. In other words, such classifications are constitutional only if they are narrowly tailored measures that further compelling governmental interests. To the extent that Metro Broadcasting is inconsistent with that holding, it is overruled....

As we have explained, Metro Broadcasting undermined important principles of this Court's equal protection jurisprudence, established in a line of cases stretching back over fifty years. Those principles together stood for an "embracing" and "intrinsically soun[d]" understanding of equal protection "verified by experience," namely, that the Constitution imposes upon federal, state, and local governmental actors the same obligation to respect the personal right to equal protection of the laws. This case therefore presents precisely the situation described by Justice Frankfurter in Helvering: we cannot adhere to our most recent decision without colliding with an accepted and established doctrine. We also note that Metro Broadcasting's application of different standards of review to federal and state racial classifications has been consistently criticized by commentators. See, e. g., Linder, Review of Affirmative Action After Metro Broadcasting v. FCC: The Solution Almost Nobody Wanted, 59 UMKC L. Rev. 293, 297, 316-317 (1991) (criticizing "anomalous results as exemplified by the two different standards of review").**

It is worth pointing out the difference between the applications of stare decisis in this case and in Planned Parenthood of Southeastern Pa. v. Casey (1992). Casey explained how considerations of stare decisis inform the decision whether to overrule a long-established precedent that has become integrated into the fabric of the law. Overruling precedent of that kind naturally may have consequences for "the ideal of the rule of law." In addition, such precedent is likely to have engendered substantial reliance, as was true in Casey itself. But in this case, as we have explained, we do not face a precedent of that kind, because Metro Broadcasting itself departed from our prior cases - and did so quite recently. By refusing to follow Metro Broadcasting, then, we do not depart from the fabric of the law; we restore it....

Because our decision today alters the playing field in some important respects, we think it best to remand the case to the lower courts for further consideration in light of the principles we have announced....
 

JUSTICE SCALIA, concurring in part and concurring in the judgment.

I join the opinion of the Court, except Part III-C, and except insofar as it may be inconsistent with the following: In my view, government can never have a "compelling interest" in discriminating on the basis of race in order to "make up" for past racial discrimination in the opposite direction....

JUSTICE THOMAS, concurring in part and concurring in the judgment...

I agree with the majority's conclusion that strict scrutiny applies to all government classifications based on race....

That these programs may have been motivated, in part, by good intentions cannot provide refuge from the principle that under our Constitution, the government may not make distinctions on the basis of race. As far as the Constitution is concerned, it is irrelevant whether a government's racial classifications are drawn by those who wish to oppress a race or by those who have a sincere desire to help those thought to be disadvantaged. There can be no doubt that the paternalism that appears to lie at the heart of this program is at war with the principle of inherent equality that underlies and infuses our Constitution.

These programs not only raise grave constitutional questions, they also undermine the moral basis of the equal protection principle. Purchased at the price of immeasurable human suffering, the equal protection principle reflects our Nation's understanding that such classifications ultimately have a destructive impact on the individual and our society. Unquestionably, "[i]nvidious [racial] discrimination is an engine of oppression."  It is also true that "[r]emedial" racial preferences may reflect "a desire to foster equality in society," ibid. But there can be no doubt that racial paternalism and its unintended consequences can be as poisonous and pernicious as any other form of discrimination. So-called "benign" discrimination teaches many that because of chronic and apparently immutable handicaps, minorities cannot compete with them without their patronizing indulgence. Inevitably, such programs engender attitudes of superiority or, alternatively, provoke resentment among those who believe that they have been wronged by the government's use of race. These programs stamp minorities with a badge of inferiority and may cause them to develop dependencies or to adopt an attitude that they are "entitled" to preferences.

In my mind, government-sponsored racial discrimination based on benign prejudice is just as noxious as discrimination inspired by malicious prejudice. In each instance, it is racial discrimination, plain and simple.

JUSTICE STEVENS, with whom JUSTICE GINSBURG joins, dissenting....

JUSTICE SOUTER, with whom JUSTICE GINSBURG and JUSTICE BREYER join, dissenting....

**This article is highlighted for obvious reasons.  Undoubtedly, Justice O'Connor and the justices who joined her opinion read this brilliant article from cover to cover and were persuaded by the power of its logic.  DL

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