Hack v. President and Fellows of Yale College

• Decision Date: 01 August 1999
• Docket Number: Docket No. 98-9136
• Parties: (2nd Cir. 2000) ELISHA D. HACK, JEREMY A. HERSHMAN, BATSHEVA GREER, and LISA B. FRIEDMAN, Plaintiffs-Appellants, v. THE PRESIDENT and FELLOWS OF YALE COLLEGE d/b/a YALE CORPORATION and YALE UNIVERSITY, RICHARD H. BRODHEAD, and BETTY TRACHTENBERG, Defendants-Appellees, THE RUTHERFORD INSTITUTE, Amicus Curiae, THE CATHOLIC LEAGUE FOR RELIGIOUS & CIVIL RIGHTS, Movant
• Court: U.S. Court of Appeals — Second Circuit

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237 F.3d 81 (2nd Cir. 2000) ELISHA D. HACK, JEREMY A. HERSHMAN, BATSHEVA GREER, and LISA B. FRIEDMAN, Plaintiffs-Appellants,
v.
THE PRESIDENT and FELLOWS OF YALE COLLEGE d/b/a YALE CORPORATION and YALE UNIVERSITY, RICHARD H. BRODHEAD, and BETTY TRACHTENBERG, Defendants-Appellees, THE RUTHERFORD INSTITUTE, Amicus Curiae, THE CATHOLIC LEAGUE FOR RELIGIOUS & CIVIL RIGHTS, Movant. Docket No. 98-9136
August Term, 1999 UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT Argued: March 29, 1999
Decided: December 28, 2000

Appeal from a judgment dismissing plaintiffs' complaint in its entirety.

Affirmed, with Judge Moran dissenting in part.

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NATHAN LEWIN, (Richard W. Garnett IV, Miller Cassidy Larroca & Lewin LLP), Washington, D.C., for Plaintiffs-Appellants.

FELIX J. SPRINGER, (Allan B. Taylor, James Sicilian, Victoria Woodin Chavey, Day Berry & Howard LLP, Dorothy Robinson, Vice President and General Counsel, Yale University, New Haven, Conn., Of Counsel), Hartford, Conn. for Defendants-Appellees.

KENNETH LASSON, Professor Law, University of Baltimore, Baltimore, Md., filed a brief for Amici Curiae Law Professors Laurence Katz, University of Baltimore School of Law, Steven H. Resnicoff, DePaul University College of Law, John W. Welch, Brigham Young University School of Law.

THOMAS MARCELLE, Slingerlands, N.Y. (Kimball E. Hazelwood, The Rutherford Institute, Of Counsel), filed a brief for Amicus Curiae, The Rutherford Institute.

KEVIN J. HASSON, ERIC W. TREENE, ROMAN P. STORZER, filed a brief for Amicus Curiae The Becket Fund for Religious Liberty.

Before LEVAL and POOLER, Circuit Judges, and MORAN^*, Senior District Judge.

MORAN, Senior District Judge

Yale College (Yale) requires all unmarried freshmen and sophomores under the age of 21 to reside in college dormitories, all of which are co-educational. The plaintiffs were Yale freshmen and sophomores when they brought this suit. They represent that as devout Orthodox Jews they cannot reside in those dormitories because to do so would conflict with their religious convictions and duties. Plaintiffs contend that Yale is a state actor or instrumentality and, therefore, the First, Fourth, and Fourteenth Amendments invalidate the parietal rule pursuant to 42 U.S.C.

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§ 1983; that in any event they are entitled to discovery to explore the interrelationship between Yale and the governments of Connecticut and New Haven; that Yale's mandatory on-campus housing requirement is both an attempt to monopolize a New Haven housing market in violation of § 2 of the Sherman Antitrust Act and a tying arrangement in violation of § 1 of that statute; and that Yale's refusal to exempt religious observers from co-educational housing violates the Fair Housing Act, 41 U.S.C. § 3601 et seq.

The district court (Alfred V. Covello, C.J.) granted defendants' motion to dismiss for failure to state a claim upon which relief can be granted, Hack v. President and Fellows of Yale College, 16 F.Supp.2d 183 (D.Conn. 1998), and plaintiffs appealed. We affirm, with this judge dissenting in part, as explained in section III.B.

I

The threshold inquiry for plaintiffs' constitutional claims is whether Yale can be considered a state actor or instrumentality acting under color of state law. The district court concluded that it could not. We agree.

What constitutes state action has been variously described by courts as "an extremely difficult question," "murky waters," "obdurate," and a "protean concept," see Krynicky v. University of Pittsburgh, 742 F.2d 94, 97 (3rd Cir. 1984) (citations omitted), as the Supreme Court has grappled with differing factual circumstances, most recently in American Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40 (1999). The Court acknowledged in Lebron v. National RR Passenger Corp., 513 U.S. 374 (1995), that "[i]t is fair to say that 'our cases deciding when private action might be deemed that of the state have not been a model of consistency.'" Id. at 378 (quoting Edmonson v. Leesville Concrete Co., 500 U.S. 614, 632 (1991) (O'Connor, J., dissenting). As in Lebron, however, we need not "traverse that difficult terrain," 513 U.S. at 378, because plaintiffs rely almost entirely upon Lebron in contending that Yale is not, in reality, a private entity but is, rather, an agency or instrumentality of the State of Connecticut for the purpose of individual constitutional rights.

Plaintiffs begin by describing the significant interrelationships between Yale and the state from colonial days well into the latter nineteenth century. To that end they note that Yale is chartered by special legislation and, indeed, that charter is confirmed in the Connecticut Constitution. They contend that Yale was created to further public, governmental objectives, objectives that are equally valid today. Yale, they point out, must submit its budget and financial report to the Connecticut legislature. Finally,¹ they argue that the presence of the Governor and Lieutenant Governor, as ex officio members of the nineteen-member "Fellows of Yale College" governing board, provides further support for the conclusion that Yale is a governmental entity.

In Lebron, the Supreme Court determined that Amtrak was a governmental entity:

We hold that where, as here, the Government creates a corporation by special law, for the furtherance of governmental objectives, and retains for itself permanent authority to appoint a majority of the directors of that corporation, the corporation is part of the Government for purposes of the First Amendment.

Id. at 400. In the wake of Lebron, other courts have concluded that the Court set forth a three-prong standard:

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only if (1) the government created the corporate entity by special law, (2) the government created the entity to further governmental objectives, and (3) the government retains "permanent authority to appoint a majority of the directors of the corporation" will the corporation be deemed a government entity for the purpose of the state action requirement. Id. at 400. See Barrios-Velazquez v. Asociacion de Empleados del Estado Libre Asociado de Puerto Rico, 84 F.3d 487, 492 (1st Cir. 1996); Hall v. American Nat'l Red Cross, 86 F.3d 919, 921-922 (9th Cir. 1996); American Bankers Mortgage Corp. v. Federal Home Loan Mortgage Corp., 75 F.3d 1401 (9th Cir. 1996); Abu-Jamal v. National Pub. Radio, 1997 WL 527349, *4 (D.D.C. Aug. 21, 1997), aff'd, 159 F.3d 635 (D.C.Cir. 1998) (table). Here, the first two factors are easily satisfied: the State of Connecticut created the corporate entity by special law, and higher education is a governmental objective (although not the exclusive province of government). Two of nineteen board members is, however, a long way from control.

Plaintiffs contend that a three-prong test, with one prong requiring "majority" governmental control, is an overly simplistic reading of Lebron. They argue that the two highest executive officers of the state are likely to be far more influential than other members, that they carry with them the aura of official action, and that their participation is at least as significant as the Presidential power to appoint a majority of Amtrak board members from specific lists of recommended private sector nominees. We disagree.

We think Lebron means what it says. Indeed, the Court there contrasted Comsat with Amtrak, noting that the President appointed only three of fifteen Comsat directors, 513 U.S. at 391, and describing it as a private corporation not government-controlled, id. at 397. Moreover, the Court has indicated its reluctance to have the federal courts indulge in evaluations of the effectiveness of governmental persuasion, absent government control. See San Francisco Arts & Athletics, Inc. v. United States Olympic Comm., 483 U.S. 522, 545-546 n.27 (1987). Plaintiffs do not suggest that Connecticut had any involvement in establishing Yale's parietal rules. It is equally clear that the state could not control Yale's policies and operations even if it chose to become involved. Yale, as a private university, did not act under color of law.

Alternatively, plaintiffs sought discovery about the interrelationships between Yale and the governments of Connecticut and New Haven, but the district court dismissed the complaint before any discovery could be initiated. Plaintiffs claim that a ruling before they had an opportunity to initiate discovery was in error. Again, we disagree.

The motion to dismiss tested the pleadings, and for the reasons we have stated we conclude that the allegations do not state a claim that Yale is a Lebron state actor. We have assumed that the governor and lieutenant governor may have attended every board meeting and vigorously participated (although it may be that their role is largely symbolic, a vestigial reminder of a bygone era), but we think that irrelevant. Nor does plaintiffs' contention that discovery might provide a basis for finding state action upon a different theory, such as that enunciated in Rendell-Baker v. Kohn, 457 U.S. 830 (1982), provide a justification. In seeking reversal of the dismissal they do not argue that their present pleadings support such an alternative theory. Rather, their contention is more of the nature that through discovery something might turn up, and they are not at all specific about what that might be. The district court, however, was not required to wait for the exploration of such a speculative hope. We note, as well, that plaintiffs have pleaded a wealth of information about the College, and not surprisingly so. Yale is not some obscure organization

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largely unknown in the greater community. Government policies and interrelationships are not generally hidden from the public.

II

Plaintiffs further allege that Yale's requirement that freshmen and sophomores reside in the dormitories is an attempt to monopolize the New Haven student housing market and that it is an illegal arrangement...