Scott v. Eversole Mortuary

• Decision Date: 08 July 1975
• Docket Number: No. 73-2765,73-2765
• Citation: 522 F.2d 1110
• Parties: George D. SCOTT et al., Plaintiffs-Appellants, v. EVERSOLE MORTUARY, a partnership, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1110

522 F.2d 1110

George D. SCOTT et al., Plaintiffs-Appellants, v. EVERSOLE MORTUARY, a partnership, et al., Defendants-Appellees.

No. 73-2765.

United States Court of Appeals Ninth Circuit.

July 8, 1975.

James F. King, Jr. (argued), Ukiah, Cal., for plaintiffs-appellants.

Stephen C. Tausz (argued), San Francisco, Cal., for defendants-appellees.

OPINION

Before ELY and WALLACE, Circuit Judges, and JAMESON, ^* District Judge.

WALLACE, Circuit Judge:

This action concerns the alleged refusal of a private mortuary in Mendocino County, California, to provide funeral services to persons of American Indian descent. Because Mendocino County does not have its own facilities, it had contracted with Eversole Mortuary and one other mortuary for morgue services. As called upon to do so, Eversole Mortuary was to transport corpses to the mortuary, embalm them, prepare them for autopsy and provide facilities for autopsies by the county coroner.

Scott and the two Bruners (appellants) are relatives of an Indian family which died in an automobile accident in Mendocino County. Pursuant to its contract with the county, Eversole Mortuary collected and embalmed the bodies; the autopsies were performed on its premises. After the autopsies, appellants requested funeral services from Eversole Mortuary. The mortuary refused, allegedly because appellants and the decedents were Indians. This action followed against Eversole Mortuary and its owners and operators (collectively referred to as Eversole).

Appellants sought recovery on three counts: discrimination in making contracts and in selling personal property in violation of 42 U.S.C. §§ 1981, 1982 (count one); intentional infliction of emotional distress (count two); and deprivation of civil rights under color of state law in violation of 42 U.S.C. § 1983 (count three). The district court dismissed the complaint without leave to amend, reasoning that the federal civil rights claims in counts one and three did not allege action under color of state law. The court also apparently concluded that jurisdiction should not be maintained independently over the state law claim in count two. This appeal followed and we reverse the dismissal of counts one and two and affirm the dismissal of count three.

Eversole has questioned whether an appeal lies from an order that dismisses a complaint but not the underlying action. Ordinarily it does not, but this case falls within an exception to the rule:

An order dismissing a complaint but not dismissing the action is not final and appealable under 28 U.S.C. § 1291 (1964), unless there are special circumstances which make it clear that a court determined that the action could not be saved by any amendment of the complaint which the plaintiff could reasonably be expected to make.

Jackson v. Nelson, 405 F.2d 872, 873 (9th Cir. 1968) (citation omitted). Accord, Lanning v. Serwold, 474 F.2d 716, 717 n.1 (9th Cir. 1973); Ruby v. Secretary of the United States Navy, 365 F.2d 385, 387 (9th Cir. 1966) (en banc), Cert. denied, 386 U.S. 1011, 87 S.Ct. 1358, 18 L.Ed.2d 442 (1967). Because the district judge did not allow leave to amend, he must have determined that the action would not be saved by amendment. ¹

Nearly all will agree, as indeed we do with our Brother Ely, that refusal to provide business services to singled-out members of the public on the basis of racial bias cannot be morally justified. Involved in this case is a race which was not only at one time in the majority but once the sole possessors of this land. But if what is alleged in the complaint is true and such discrimination has occurred, recourse in the courts must be pursuant to law. Our task then is to see whether the law provides assistance to appellants in redress of their alleged wrongs.

Appellants contend that none of the counts of their complaint should have been dismissed. As regards count one, they argue that 42 U.S.C. §§ 1981, 1982 prohibit racial discrimination in making contracts ² and in selling personal property ³ even in the absence of action under color of state law. We agree. The Supreme Court has already held that section 1982 prohibits both public and private racial discrimination in the sale of property. Jones v. Alfred H. Mayer Co., 392 U.S. 409, 88 S.Ct. 2186, 20 L.Ed.2d 1189 (1968). The Court relied on the legislative history of section 1 of the Civil Rights Act of 1866, the statute originally enacting the provisions now codified in section 1982. Id. at 420-37, 88 S.Ct. 2186. But since section 1 of the Civil Rights Act of 1866 also originally enacted the provisions now codified in section 1981, ⁴ that section must likewise be construed to prohibit private racial discrimination in making contracts. Johnson v. Railway Express Agency, Inc., --- U.S. ---, ---, 95 S.Ct. 1716, 1719, 44 L.Ed.2d 295 (1975); Bowers v. Campbell, 505 F.2d 1155, 1157-58 (9th Cir. 1974).

Appellants have appropriately pleaded claims arising under section 1981 (attempted contract for funeral services) and section 1982 (attempted purchase of caskets) and we, therefore, reverse the dismissal of count one.

However, that count one was erroneously dismissed does not require reversal of the dismissal of count three. There a different section is involved. Only deprivation of civil rights "under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory" is prohibited by 42 U.S.C. § 1983. Appellants argue that this requirement has been met in the present case because California extensively regulates funeral services and because Eversole has contracted with Mendocino County to furnish morgue services and facilities. They do not contend, and their complaint does not allege, that Eversole's decision to discriminate was influenced by any public official. Whether Eversole acted under color of state law, therefore, depends upon the degree of state involvement in its alleged discriminatory activities.

(W)here the impetus for the discrimination is private, the State must have "significantly involved itself with invidious discriminations," Reitman v. Mulkey, 387 U.S. 369, 380, 87 S.Ct. 1627, 1634, 18 L.Ed.2d 830 (1967), in order for the discriminatory action to fall within the ambit of the constitutional prohibition.

Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 173, 92 S.Ct. 1965, 1971, 32 L.Ed.2d 627 (1972). Although Moose Lodge dealt expressly with the state action requirement of the Fourteenth Amendment, ⁵ the requirement of action under color of state law in section 1983 is substantially identical. United States v. Price, 383 U.S. 787, 794 n.7, 86 S.Ct. 1152, 16 L.Ed.2d 267 (1966); Ouzts v. Maryland Nat'l Ins. Co., 505 F.2d 547, 550 (9th Cir. 1974) (en banc). The question before us, then, is whether the state "significantly involved itself" in the alleged discrimination against appellants. ⁶

Several factors usually relevant to a finding of significant state involvement are not present in this case. Eversole did not conspire with state officials or otherwise obtain their assistance in discriminating against appellants. E.g., Adickes v. S. H. Kress & Co., 398 U.S. 144, 152, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970); Griffin v. Maryland, 378 U.S. 130, 135-37, 84 S.Ct. 1770, 12 L.Ed.2d 754 (1964). Nor did it act, or purport to act, as an agent of the state in refusing to deal with appellants. E. g., Griffin v. Maryland, supra, 378 U.S. at 135, 84 S.Ct. 1770. Its alleged discrimination is not compelled, approved, encouraged or authorized by California law, E. g., Reitman v. Mulkey, 387 U.S. 369, 373-81, 87 S.Ct. 1627, 18 L.Ed.2d 830 (1967), but instead is specifically prohibited, Cal.Civ.Code §§ 51, 52. Finally, appellants do not claim that providing funeral services is a public function traditionally performed by government agencies. E. g., Evans v. Newton, 382 U.S. 296, 298-302, 86 S.Ct. 486, 15 L.Ed.2d 373 (1966). See Lloyd Corp. v. Tanner, 407 U.S. 551, 556-70, 92 S.Ct. 2219, 33 L.Ed.2d 131 (1972).

The Supreme Court has found significant state involvement in only one case in which the preceding factors were absent. In Burton v. Wilmington Parking Authority, 365 U.S. 715, 81 S.Ct. 856, 6 L.Ed.2d 45 (1961), the Court held that a state agency had entered into a sufficiently interdependent relationship with a segregated restaurant to satisfy the state action requirement of the Fourteenth Amendment. The restaurant was operated on public property, in a building constructed and maintained with public funds. It benefited indirectly both from the state agency's exemption from property taxes and from the presence in the building of parking for its customers. Id. at 718-20, 723-24, 81 S.Ct. 856. The agency, for its part, received revenue from the lease necessary to maintain its financial self-sufficiency and increased patronage of its parking facilities. Id. at 718-19, 723, 724, 81 S.Ct. 856.

Appellants argue that the contract between Eversole and Mendocino County establishes a similar interdependent relationship. The mutual benefits they cite are profit and referral of customers to the mortuary and, on the other side, avoidance by the county of the expense of operating its own morgue. We do not find these benefits sufficient. Most contracts, whether public or private, confer benefits upon the contracting parties. The interdependence found in Burton was more extensive. Because the financial self-sufficiency of the state agency depended upon the profitability of the segregated restaurant, the state agency became a joint venturer in the latter's affairs. Moose Lodge, supra, 407 U.S. at 177, 92 S.Ct. 1965; see Jackson v. Metropolitan Edison Co., 419 U.S. 345, 357, 95 S.Ct. 449, 457, 42 L.Ed.2d 477 (1974). Furthermore, Eversole does not lease public property or benefit indirectly from an exemption from property taxes. Although Eversole's contract with the county may increase its private patronage, like the restaurant's lease of property near public parking facilities in Burton,...