436 U.S. 149 (1978), 77-25, Flagg Bros., Inc. v. Brooks

Docket Nº:No. 77-25
Citation:436 U.S. 149, 98 S.Ct. 1729, 56 L.Ed.2d 185
Party Name:Flagg Bros., Inc. v. Brooks
Case Date:May 15, 1978
Court:United States Supreme Court
 
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Page 149

436 U.S. 149 (1978)

98 S.Ct. 1729, 56 L.Ed.2d 185

Flagg Bros., Inc.

v.

Brooks

No. 77-25

United States Supreme Court

May 15, 1978

Argued January 18, 1978

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

Syllabus

After respondent Brooks and her family had been evicted from their apartment and their belongings had been stored by petitioner storage company, Brooks was threatened with sale of her belongings pursuant to New York Uniform Commercial Code § 7-210 unless she paid her storage account. She thereupon brought this class action under 42 U.S.C. § 1983, seeking damages and injunctive relief and a declaration that the sale pursuant to § 7-210 (which provides a procedure whereby a warehouseman conforming to the provisions of the statute may convert his lien into good title) would violate the Due Process and Equal Protection Clauses of the Fourteenth Amendment. Subsequent interventions by respondent Jones as plaintiff and petitioners warehouse associations and the New York State Attorney General as defendants were permitted. The District Court dismissed the complaint for failure to state a claim for relief under § 1983 which provides, inter alia, that every person who under color of any state statute subjects any citizen to the deprivation of any rights secured by the Constitution and federal laws shall be liable to the injured party. The Court of Appeals reversed, holding that state action might be found in the exercise by a private party of "some power delegated to it by the State which is traditionally associated with sovereignty," and that,

by enacting § 7-210, New York not only delegated to the warehouseman a portion of its sovereign monopoly power over binding conflict resolution . . . , but also let him, by selling stored goods, execute a lien and thus perform a function which has traditionally been that of the sheriff.

Held: A warehouseman's proposed sale of goods entrusted to him for storage, as permitted by § 7-210, is not "state action," and since the allegations of the complaint failed to establish that any violation of respondents' Fourteenth Amendment rights was committed by either the storage company or the State of New York,

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the District Court properly concluded that no claim for relief was stated by respondents under 42 U.S.C. § 1983. Pp. 155-166.

(a) Respondents' failure to allege the participation of any public officials in the proposed sale plainly distinguishes this litigation from decisions such as North Georgia Finishing, Inc. v. Di-Chem, Inc., 419 U.S. 601; Fuentes v. Shevin, 407 U.S. 67; and Sniadach v. Family Finance Corp., 395 U.S. 337, which imposed procedural restrictions on creditors' remedies. P. 157.

(b) The challenged statute does not delegate to the storage company an exclusive prerogative of the sovereign. Other remedies for the settlement of disputes between debtors and creditors (which is not traditionally a public function) remain available to the parties. Terry v. Adams, 345 U.S. 461; Smith v. Allwright, 321 U.S. 649; Nixon v. Condon, 86 U.S. 73; and Marsh v. Alabama, 326 U.S. 501, distinguished. Pp. 157-163.

(c) Though respondents contend that the State authorized and encouraged the storage company's action by enacting § 7-10, a State's mere acquiescence in a private action does not convert such action into that of the State. Moose Lodge No. 107 v. Irvis, 407 U.S. 163. Pp. 164-166.

553 F.2d 764, reversed.

REHNQUIST, J., delivered the opinion of the Court, in which BURGER, C.J., and STEWART, BLACKMUN, and POWELL, JJ., joined. MARSHALL, J., filed a dissenting opinion, post, p. 166. STEVENS, J., filed a dissenting opinion, in which WHITE and MARSHALL, JJ., joined, post, p. 168. BRENNAN, J., took no part in the consideration or decision of the cases.

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REHNQUIST, J., lead opinion

MR. JUSTICE REHNQUIST delivered the opinion of the Court.

The question presented by this litigation is whether a warehouseman's proposed sale of goods entrusted to him for storage, as permitted by New York Uniform Commercial Code § 7-210 (McKinney 1964),1 is an action properly attributable

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to the State of New York. The District Court found that the warehouseman's conduct was not that of the State, and dismissed this suit for want of jurisdiction under 28 U.S.C.

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§ 1343(3). 44 F.Supp. 1059 (SDNY 1975). The Court of Appeals for the Second Circuit, in reversing the judgment of the District Court, found sufficient state involvement [98 S.Ct. 1732] with the proposed sale to invoke the provisions of the Due Process Clause of the Fourteenth Amendment. 553 F.2d 764 (1977). We agree with the District Court, and we therefore reverse.

I

According to her complaint, the allegations of which we must accept as true, respondent Shirley Brooks and her family were evicted from their apartment in Mount Vernon, N.Y., on June 13, 1973. The city marshal arranged for Brooks' possessions to be stored by petitioner Flagg Brothers, Inc., in its warehouse. Brooks was informed of the cost of moving and storage, and she instructed the workmen to proceed, although she found the price too high. On August 25, 1973, after a series of disputes over the validity of the charges being claimed by petitioner Flagg Brothers, Brooks received a letter demanding that her account be brought up to date within 10 days "or your furniture will be sold." App. 13a. A series of subsequent letters from respondent and her attorneys produced no satisfaction.

Brooks thereupon initiated this class action in the District Court under 42 U.S.C. § 1983, seeking damages, an injunction against the threatened sale of her belongings, and the declaration that such a sale pursuant to § 7-210 would violate the Due Process and Equal Protection Clauses of the Fourteenth Amendment. She was later joined in her action by Gloria Jones, another resident of Mount Vernon whose goods had been stored by Flagg Brothers following her eviction.

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The American Warehousemen's Association and the International Association of Refrigerated Warehouses, Inc., moved to intervene as defendants, as did the Attorney General of New York and others seeking to defend the constitutionality of the challenged statute.2 On July 7, 1975, the District Court, relying primarily on our decision in Jackson v. Metropolitan Edison Co., 419 U.S. 345 (1974), dismissed the complaint for failure to state a claim for relief under § 1983.

A divided panel of the Court of Appeals reversed.3 The majority noted that Jackson had suggested that state action might be found in the exercise by a private party of "`some

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power delegated to it by the State which is traditionally associated with sovereignty.'" 553 F.2d at 770, quoting 419 U.S. at 353. The majority found:

[B]y enacting § 7-210, New York not only delegated to the warehouseman a [98 S.Ct. 1733] portion of its sovereign monopoly power over binding conflict resolution [citations omitted], but also let him, by selling stored goods, execute a lien, and thus perform a function which has traditionally been that of the sheriff.

553 F.2d at 771. The court, although recognizing that the Court of Appeals for the Ninth Circuit had reached a contrary conclusion in dealing with an identical California statute in Melara v. Kennedy, 541 F.2d 802 (1976), concluded that this delegation of power constituted sufficient state action to support federal jurisdiction under 28 U.S.C. § 1343(3). The dissenting judge found the reasoning of Melara persuasive.

We granted certiorari, 434 U.S. 817, to resolve the conflict over this provision of the Uniform Commercial Code, in effect in 49 States and the District of Columbia, and to address the important question it presents concerning the meaning of "state action" as that term is associated with the Fourteenth Amendment.4

II

A claim upon which relief may be granted to respondents against Flagg Brothers under § 1983 must embody at least two elements. Respondents are first bound to show that they have been deprived of a right "secured by the Constitution and the laws" of the United States. They must secondly show that Flagg Brothers deprived them of this right acting "under color of any statute" of the State of New York. It is clear that these two elements denote two separate areas of

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inquiry. Adickes v. S. H. Kress & Co., 398 U.S. 144, 150 (1970).

Respondents allege in their complaints that "the threatened sale of the goods pursuant to New York Uniform Commercial Code § 7-210" is an action under color of state law. App. 14a, 47a. We have previously noted, with respect to a private individual, that

[w]hatever else may also be necessary to show that a person has acted "under color of [a] statute" for purposes of § 1983, . . . we think it essential that he act with the knowledge of and pursuant to that statute.

Adickes, supra at 162 n. 23. Certainly, the complaints can be fairly read to allege such knowledge on the part of Flagg Brothers. However, we need not determine whether any further showing is necessary, since it is apparent that neither respondent has alleged facts which constitute a deprivation of any right "secured by the Constitution and laws" of the United States.

A moment's reflection will clarify the essential distinction between the two elements of a § 1983 action. Some rights established either by the Constitution or by federal law are protected from both governmental and private deprivation. See, e.g., Jones v. Alfred H. Mayer Co., 392 U.S. 409, 422-424 (1968) (discussing 42 U.S.C. § 1982). Although a private person may cause a deprivation of such a right, he may be subjected to liability under § 1983 only when he does so under color of law. Cf. 392 U.S. at 424-425, and n....

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