321 F.3d 950 (10th Cir. 2003), 00-1145, Concrete Works of Colorado, Inc. v. City and County of Denver

Docket Nº:00-1145.
Citation:321 F.3d 950
Party Name:CONCRETE WORKS OF COLORADO, INC., a Colorado Corporation, Plaintiff-Appellee, v. CITY AND COUNTY OF DENVER, a Municipal Corporation, Defendant-Appellant. City of Chicago; City of Las Vegas; City of Minneapolis; City of San Francisco; International Municipal Lawyers Association; Lawyers' Committee for Civil Rights Under Law; City of Phoenix; United
Case Date:February 10, 2003
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

Page 950

321 F.3d 950 (10th Cir. 2003)

CONCRETE WORKS OF COLORADO, INC., a Colorado Corporation, Plaintiff-Appellee,

v.

CITY AND COUNTY OF DENVER, a Municipal Corporation, Defendant-Appellant.

City of Chicago; City of Las Vegas; City of Minneapolis; City of San Francisco; International Municipal Lawyers Association; Lawyers' Committee for Civil Rights Under Law; City of Phoenix; United States; Minority Business Enterprise Legal Defense And Education Fund, Inc.; National Association of Minority Contractors; Latin American Management Association; National Asian Pacific American Legal Consortium; Pacific Legal Foundation, Amici Curiae.

No. 00-1145.

United States Court of Appeals, Tenth Circuit

February 10, 2003

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J. Scott Detamore, (William Perry Pendley, with him on the brief), Mountain States Legal Foundation, Denver, CO, for Plaintiff-Appellee.

Eileen Penner, Mayer, Brown & Platt, Washington, DC, (Thomas B. Colby, Mayer, Brown & Platt, Washington, DC; J. Wallace Wortham, Jr., City Attorney, Norman R. Bangeman, Laurie J. Heydman, Dean Speirs, Victoria Ortega, Assistant City Attorneys, City and County of Denver, Denver, CO, with her on the briefs), for Defendant-Appellant.

David A. Strauss, Chicago, IL, filed an amici curiae brief on behalf of Cities of Chicago, Las Vegas, Minneapolis, and San Francisco, and International Municipal Lawyers Association; Mara S. Georges, Corporation Counsel of the City of Chicago, Lawrence Rosenthal, Deputy Corporation Counsel, Chicago, IL, on behalf of the City of Chicago; Bradford R. Jerbic, Las Vegas City Attorney, Las Vegas, NV, on behalf of the City of Las Vegas; Jay M. Heffern, Minneapolis City Attorney, Peter W. Ginder, Assistant City Attorney, Minneapolis, MN, on behalf of the City of Minneapolis; Louise H. Renne, City Attorney, Randy Riddle and Teresa Strieker, Deputy City Attorneys, San Francisco, CA, on behalf of the City of San Francisco; Henry W. Underhill, Jr., General Counsel & Executive Director, Lani L. Williams, Associate Counsel, International Municipal Lawyers Association, Washington, DC, on behalf of International Municipal Lawyers Association.

Paul C. Saunders, Cravath, Swaine & Moore, New York, NY, and Thomas J. Henderson, Lawyers' Committee for Civil Rights Under Law, Washington, DC, filed an amicus curiae brief on behalf of Lawyers' Committee for Civil Rights Under Law.

Brad Holm, Alan K. Hyde, Holm, Wright, Hyde & Hays, PLC, Phoenix, AZ, filed an amicus curiae brief on behalf of the City of Phoenix.

Mark L. Gross, Lisa J. Stark, Attorneys, Department of Justice, Washington, DC, filed an amicus curiae brief on behalf of the United States.

Stephen D. Bell, Fatina N. Purdie, Dorsey & Whitney, LLP, Denver, CO, and Franklin M. Lee, Minority Business Enterprise Legal Defense and Education

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Fund, Inc., Washington, DC, filed an amici curiae brief on behalf of the Minority Business Enterprise Legal Defense and Education Fund, Inc., the National Association of Minority Contractors, the Latin American Management Association, and the National Asian Pacific American Legal Consortium.

John H. Findley, Pacific Legal Foundation, Sacramento, CA, filed an amicus curiae brief on behalf of Pacific Legal Foundation.

Before KELLY, McKAY, and MURPHY, Circuit Judges.

MURPHY, Circuit Judge.

I. INTRODUCTION

Plaintiff, Concrete Works of Colorado, Inc. ("CWC") initiated this action in 1992, challenging the constitutionality of an affirmative action ordinance enacted by the City and County of Denver (hereinafter the "City" or "Denver"). The ordinance established participation goals for racial minorities and women on certain City construction and professional design projects. Denver has amended the ordinance twice since this lawsuit was initiated but it remains essentially unchanged for purposes of this case.

In 1993, the district court granted summary judgment in favor of Denver. See Concrete Works of Colorado, Inc. v. City & County of Denver, 823 F.Supp. 821, 845 (D.Colo.1993) ("Concrete Works /"). After CWC appealed, this court reversed the grant of summary judgment and remanded the case for trial. See Concrete Works of Colorado, Inc. v. City & County of Denver, 36 F.3d 1513, 1530-31 (10th Cir. 1994) ("Concrete Works II"). On remand, a bench trial was held and the district court entered judgment in favor of CWC on its claims for injunctive and declaratory relief. See Concrete Works of Colorado, Inc. v. City & County of Denver, 86 F.Supp.2d 1042, 1079 (D.Colo.2000) ("Concrete Works III "). The district court enjoined Denver from enforcing the ordinance. See id. CWC's entitlement to damages was reserved and the district court directed entry of judgment under Rule 54(b) of the Federal Rules of Civil Procedure. See id. at 1044, 1079. Denver then brought this appeal.

Section II. of this opinion summarizes the challenged Denver ordinances and this litigation to date. Section III. generally presents the applicable law and the parties' positions thereon. In Section IV., we examine the evidence upon which Denver relies to support the ordinances. At trial, Denver presented historical evidence, statistical evidence, and anecdotal evidence which are discussed respectively in subsections IV.A., IV.B., and IV.C. In Section V., we discuss the legal framework used by the district court to evaluate Denver's evidence. Section VI contains a discussion of CWC's rebuttal evidence, including its challenges to Denver's use of marketplace data and to the reliability of Denver's disparity studies. In Section VII., we address the question of narrow tailoring.

Exercising jurisdiction pursuant to 28 U.S.C. §§ 1291, 1292(a)(1),1 we reverse and remand.

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II. BACKGROUND

Comprehensive statements of the relevant facts and prior proceedings in this case are fully set out in our previous opinion and in the two district court orders. See Concrete Works II, 36 F.3d at 1515-1517; Concrete Works III, 86 F.Supp.2d at 1043-46; Concrete Works I, 823 F.Supp. at 824-826. In particular, the most recent order of the district court contains a thorough description of the numerous studies commissioned by the City and the operation of the ordinances. See Concrete Works III, 86 F.Supp.2d at 1053-61, 1050-53. Consequently we have summarized only the most relevant facts.

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The appellate record in this case is prodigious. The trial transcript, including opening and closing statements, exceeds three thousand pages and the entire appellate appendix exceeds ten thousand pages. Consequently, the parties' ability to cogently frame the issues and provide record support for their respective positions was particularly critical. Though we are under no obligation to do so, this court made every reasonable effort to locate pertinent portions of the record when a citation to such was omitted by the parties.

A. The Ordinances

In 1990, the City promulgated an affirmative action program codified as Ordinance No. 513 (the "1990 Ordinance"). The 1990 Ordinance established the Mayor's Office of Contract Compliance ("MOCC") and delegated to that office "authority to promulgate such rules and regulations and/or informal guidelines as may be necessary to effectuate the purposes" of the 1990 Ordinance. Subject to exemptions adopted by the Manager of Public Works, the 1990 Ordinance applied to all contracts for which bidding was required before the City could make an award.

The 1990 Ordinance contained annual goals for the utilization of minority business enterprises ("MBEs") and women business enterprises ("WBEs"). Of the total dollars spent annually for construction contracts with the City, the goal was 16% to MBEs and 12% to WBEs. The annual goals for professional design and construction services were 10% of annual expenditures to MBEs and 10% to WBEs. MBEs were defined in the 1990 Ordinance as businesses: (1) at least 51% owned by one or more eligible minorities and (2) with daily business operations controlled by one or more eligible minorities. Minorities were defined as persons of "Black, Hispanic, Asian-American, or American Indian descent." WBEs were defined as businesses: (1) at least 51% owned by one or more women and (2) with daily business operations controlled by one or more women. To participate in the program, both MBEs and WBEs were required to obtain certification from the City. Notwithstanding the requirement to meet annual goals, the MOCC could set individualized M/WBE participation goals for specific City construction and professional design projects. On some projects, goals were set at zero.

Prime contractors and subcontractors who bid on City contracts were required to commit to the goals and requirements set forth in the 1990 Ordinance. Bidders could comply with the 1990 Ordinance by meeting the project participation goals or by demonstrating sufficient good faith efforts to meet those goals. Bidders could meet the good-faith requirements by demonstrating that they sought to subcontract with M/WBEs but were unsuccessful or that they rejected a certified MBE or WBE because it did not submit the lowest bid or was not qualified. If the bidder failed to meet either the good-faith or project-participation requirements, the bid was considered "not responsive."

In 1996, the City replaced the 1990 Ordinance with Ordinance No. 304 (the "1996 Ordinance"). The district court stated that the 1996 Ordinance differed from the 1990 Ordinance as follows:

The 1996 Ordinance . . . amended the 1990 Ordinance by expanding the definition of "covered contracts" to include limited categories of privately financed projects on City-owned land; added updated information and findings to the statement of factual support for continuing the program; refined the requirements for W/MBE certification and graduation; mandated the use of MBEs

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and WBEs on...

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