Hershell Gill Consulting Eng. v. Miami-Dade County

Decision Date24 August 2004
Docket NumberNo. 98-2300-CIV-JORDAN.,98-2300-CIV-JORDAN.
Citation333 F.Supp.2d 1305
PartiesHERSHELL GILL CONSULTING ENGINEERS, INC., et al. Plaintiffs v. MIAMI-DADE COUNTY, Florida, et al. Defendants
CourtU.S. District Court — Southern District of Florida

Charles S. Caulkins, Fisher & Phillips, Fort Lauderdale, FL, Herbert P. Schlanger, Atlanta, GA, for Plaintiff.

Robert A. Cuevas, Jr., Dade County Attorney's Office, Miami, FL, for Defendants.

AMENDED FINDINGS OF FACT AND CONCLUSIONS OF LAW1

JORDAN, District Judge.

A little more than six years ago, the Eleventh Circuit upheld Judge Kenneth Ryskamp's ruling that Miami-Dade County's Minority and Women Business Enterprise (MWBE) programs violated the Fourteenth Amendment's Equal Protection Clause as applied to sectors of the construction contracting industry. See Engineering Contractors Ass'n v. Metropolitan Dade County, 943 F.Supp. 1546 (S.D.Fla.1996), aff'd, 122 F.3d 895 (11th Cir.1997) (ECA). Despite this adverse decision, Miami-Dade County did not amend, modify, or repeal the remaining sections of its MWBE programs, and further litigation predictably ensued.

This case involves a post-ECA challenge, under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000d, et seq., and under the Equal Protection Clause of the Fourteenth Amendment, see 42 U.S.C. § 1983, to sections of the MWBE programs establishing "participation goals" for minority and women business enterprises in awarding County architectural and engineering (A & E) contracts. The plaintiffsHershell Gill Consulting Engineers, Inc. and Brill and Rodriguez, Inc. — are engineering firms owned by white males. The defendants are Miami-Dade County, former County Manager Merritt Stierheim (sued only in his official capacity), and various former and current County Commissioners sued in their official and individual capacities (Betty Ferguson, Barbara Carey-Shuler, Bruno Barreiro, Pedro Reboredo, Gwen Margolis, Dorrin Rolle, Dennis Moss, Miriam Alonso, Katy Sorenson, Jimmy Morales, Javier Souto, Miguel Diaz de la Portilla, and Natacha Millan).2 The Women's Business Enterprise Group (WBEG) intervened on behalf of the County and actively participated at the preliminary injunction hearing and at trial. The Urban Design Professionals Association — a trade association representing the interests of black professional engineers, architects, and design professionals — also intervened on the County's side, but was subsequently dismissed from the case for failing to obtain substitute counsel.

As explained below, the MWBE programs are unconstitutional as applied to A & E contracts, and will be permanently enjoined in that sphere. The Commissioners are absolutely immune in their individual capacities for their votes in favor of the MWBE programs and their subsequent decisions to not repeal or amend the programs. But with respect to their votes to apply MWBE measures to A & E contracts that were presented to them, the Commissioners were acting in their administrative capacities, and do not receive absolute immunity. Because the law was clearly established, at least since ECA, that the MWBE programs were unconstitutional absent the requisite evidentiary support, the Commissioners are not entitled to qualified immunity and are liable for any compensatory and punitive damages in their individual capacities. The plaintiffs, however, have failed to prove any compensatory damages, and punitive damages are not warranted. The plaintiffs will only be awarded nominal damages and attorney's fees and costs, for which the Commissioners and the County will be jointly and severally liable.

I. BACKGROUND

The County's MWBE programs are no strangers to legal challenges. In South Florida Chapter of Associated General Contractors v. Metropolitan Dade County, 723 F.2d 846 (11th Cir.1984), the Eleventh Circuit upheld an earlier version (the Black Business Enterprise (BBE) program) in its entirety. In so doing, the Eleventh Circuit followed Chief Justice Burger's plurality opinion in Fullilove v. Klutznick, 448 U.S. 448, 100 S.Ct. 2758, 65 L.Ed.2d 902 (1980). The standard Chief Justice Burger used to analyze the constitutionality of an affirmative action program in Fullilove was neither strict scrutiny nor any other traditional standard of equal protection review. See, e.g., id. at 473, 490-92, 100 S.Ct. 2758.

Five years after the Eleventh Circuit decided Associated General Contractors, the Supreme Court abandoned the Fullilove standard for analyzing state and local race-based remedial programs, holding that such programs must satisfy strict scrutiny to pass constitutional muster. See City of Richmond v. J.A. Croson Co., 488 U.S. 469, 493-95, 109 S.Ct. 706, 102 L.Ed.2d 854 (1989) (four-Justice plurality); id. at 520, 109 S.Ct. 706 (Scalia, J., concurring) (agreeing that "strict scrutiny must be applied to all governmental classifications by race"). Following the Croson decision, several non-minority plaintiffs brought a second constitutional challenge to Miami-Dade County's BBE program. That case, Capeletti Bros., et al. v. Metro. Dade County, et al., No. 90-0678-Civ-Ryskamp, was tried in the Southern District of Florida in July of 1992. Before Judge Ryskamp issued his opinion, however, the parties reached a settlement and stipulated to a dismissal of the action with prejudice.

In September of 1994, six trade associations whose members regularly performed work on County construction projects filed a third suit in the Southern District of Florida. The complaint named the County, its Commissioners, and certain other related parties as defendants. The trade associations challenged the same MWBE programs at issue here, but only as they applied to certain sectors (Standard Industry Classifications (SIC) 15, 16, and 17) of the construction industry. Judge Ryskamp struck down the three MWBE programs as applied, and the Eleventh Circuit affirmed. See See Engineering Contractors Ass'n v. Metropolitan Dade County, 943 F.Supp. 1546 (S.D.Fla.1996), aff'd, 122 F.3d 895 (11th Cir.1997) (ECA). The County subsequently enacted a Community Small Business Enterprise (CSBE) program for construction contracts, but continued to apply racial, ethnic, and gender criteria to its purchases of goods and services in other areas, including its procurement of A & E services.

II. THE COUNTY'S MWBE PROGRAMS

At issue in this case are three sections of the MWBE programs enacted by the Miami-Dade County Board of Commissioners, specifically, §§ 2-8.2, 2-8.2.3, and 2-8.2.4 of the County Code: (1) the Black Business Enterprise (BBE) program, enacted in 1982 and most recently amended in 1994; (2) the Hispanic Business Enterprise (HBE) program, enacted in 1994; and (3) the Women Business Enterprise (WBE) program, enacted in 1994. For ease of reference, these three programs are collectively referred to as the MWBE programs.

In order to qualify for participation in one of the MWBE programs, a business must be owned and controlled by one or more black, Hispanic, or female individuals, and must have an actual place of business in Miami-Dade County. MWBE joint ventures must have at least one member certified under one of the three MWBE programs. Each MWBE participant must also demonstrate that it does not exceed the size limits for "small business concerns" as defined by the Small Business Administration of the United States Department of Commerce. If an MWBE exceeds that size limit, however, it may retain its certification if it demonstrates that "it continues to experience the kinds of racial [or gender] discrimination addressed by [the programs]." County Code § 2-8.2(3)(e).

The MWBE programs apply to certain classes of County contracts for which participation goals have been set. This case concerns only architecture and engineering (A & E) contracts, which means that only a portion of SIC 871 of County contracts is involved. For this class of contracts, the County has set participation goals of 12% for BBEs, 25% for HBEs, and 17% for WBEs. The participation goals apply to all A & E contracts in excess of $25,000 that are funded in whole or in part by the County. The County is required to make every reasonable effort to achieve the participation goals, and may use any of the following five contract measures to do so:

. Set-Asides — This measure provides that a contract is set aside for bidding solely among MWBEs. In general, the County may use the set-aside measure if there are at least three MWBE businesses available to perform the contract. The County may also waive competitive bidding if there are at least two MWBEs available, provided neither of them has been awarded a County contract for like goods or services in the last three years, and a price analysis has been done to ensure that the price is competitive.

. Subcontractor Goals — This measure requires a prime contractor to subcontract a certain percentage of work to MWBEs. The percentage is determined on a case-by-case basis. A waiver is available if the prime contractor can demonstrate that MWBEs are not available to do the work at a competitive price.

. Project Goals — This measure allows the County to create a pool of MWBE subcontractors from which it selects firms for specified types of work under County contracts.

. Bid Preferences — This measure artificially "reduces" an MWBE bid price by as much as 10% for purposes of determining the lowest bid. The actual price the County pays for the work is unaffected by this "reduction."

. Selection Factors — This measure is similar to a bid preference, but operates on factors other than price. For instance, when bid evaluation procedures assign weights to various factors, MWBE performance on those factors may be boosted by up to 10%.

Once an A & E contract is identified as being subject to a participation goal, it is submitted to a review committee to determine whether a contract measure should be...

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