Neighborhood Action Coalition v. City of Canton, Ohio

• Decision Date: 27 July 1989
• Docket Number: No. 88-3450,88-3450
• Citation: 882 F.2d 1012
• Parties: NEIGHBORHOOD ACTION COALITION, et al., Plaintiffs-Appellants, v. CITY OF CANTON, OHIO, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1012

882 F.2d 1012

NEIGHBORHOOD ACTION COALITION, et al., Plaintiffs-Appellants, v. CITY OF CANTON, OHIO, et al., Defendants-Appellees.

No. 88-3450.

United States Court of Appeals Sixth Circuit.

July 27, 1989.

Edward L. Gilbert (argued), Edward L. Gilbert Co., LPA, Canton, Ohio, for plaintiffs-appellants.

Mariella Mestel, Safety Forces Adv., Office of the Canton Law Dept., William J. Hamann (argued), Office of the City Atty., Canton Law Dept., Canton, Ohio, for defendant-appellee City of Canton.

Lemuel R. Green, William S. Heichel, Canton, Ohio, for defendant-appellee The Store.

Lemuel R. Green, Canton, Ohio, for defendant-appellee Basim Rashid.

Before ENGEL, Chief Judge, JONES, Circuit Judge, and WOODS, District Judge. ^*

WOODS, District Judge:

On this appeal we review a district court's Order of Dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons that follow, we affirm in part and reverse in part.

I.

The Neighborhood Action Coalition (NAC) is an unincorporated association consisting of residents of the northeast section of Canton, Ohio, and organized for the purpose of fostering open housing. L.Q. Ellis, Mary Ellis, Carmine Altieri, and Myrna Jo Johnson are also residents of northeast Canton. Together, with the NAC, they represent a class of at least twenty-five residents of northeast Canton who filed a complaint in the Northern District of Ohio against the City of Canton; The Store, a grocery store in the city; and Basim Rashid, lessee and owner of The Store.

In their complaint, appellants assert that the City of Canton receives federal funds from the Department of Housing and Urban Development and from United States Department of Treasury Block Grants. Appellants allege that the City has refused to invest these funds in the northeast region of the City (NAC area) in the same proportion it invests funds in other regions of the City. The complaint also asserts that the NAC area has been targeted as a transitional area and that the City of Canton purposefully allows the area to be taken over by disadvantaged minorities. To that end, the City has told white residents, including appellants, to move; has provided little or no police protection; has allowed a city park plagued by drug trafficking to remain open continuously without patrol or supervision; and has encouraged Basim Rashid to operate The Store, a business that allegedly sells or allows the sale of alcohol to minors and known alcoholics and allows them to consume the alcohol on the premises.

The appellants allege that they are injured by the defendants' acts; the neighborhood has become unsafe for themselves and their children, and the use and value of their real property has been substantially reduced. They allege that these injuries entitle them to relief under Title VI of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000d et seq.; the Fair Housing Act of 1968, 42 U.S.C. Sec. 3601 et seq.; and the Civil Rights Act of 1866, 1870 and 1871, 42 U.S.C. Secs. 1981, 1982, 1983. The complaint seeks injunctive relief in the form of a Court Order that prohibits the municipality from providing services in a racially discriminatory manner, requires the municipality to provide police protection to the NAC area that is equal to the protection provided other Canton neighborhoods; and obligates the City to revoke The Store's liquor license. The complaint also seeks compensatory and punitive damages.

All three defendants, the City of Canton, Rashid, and The Store, filed motions to dismiss. On April 14, 1988, the district court granted the motions and dismissed all three defendants. The appellants appeal only the district court's dismissal of the City of Canton. Accordingly, only those portions of the district court's order of dismissal that affect the City will be addressed. In reviewing those portions of the district court's order, we must decide if it appears "beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102, 2 L.Ed.2d 80 (1957). For the purposes of a motion to dismiss, the allegations in the complaint are taken to be true. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974).

II.

A.

Appellants first challenge the trial court's dismissal of their Title VI claim. Title VI prohibits discrimination in any program receiving federal financial assistance:

No person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.

42 U.S.C. Sec. 2000d. Title VI was intended to "halt federal funding of entities that violate a prohibition of racial discrimination similar to that of the Constitution." Regents of the University of California v. Bakke, 438 U.S. 265, 284, 98 S.Ct. 2733, 2745, 57 L.Ed.2d 750 (1978) (Powell, J.). To achieve these ends, Congress explicitly provided for an administrative enforcement mechanism, which allows the federal funding agency to attempt to secure compliance and, failing that, to terminate the violator's federal funding. 42 U.S.C. Sec. 2000d-1.

In the present case, the appellants did not invoke the elaborate enforcement mechanism of Sec. 2000d-1 prior to pursuing their private cause of action in federal court. The district court found this failure to exhaust administrative remedies to be a procedural bar to the Title VI cause of action and dismissed it from the suit. The court based its ruling on Santiago v. Philadelphia, 435 F.Supp. 136 (E.D.Pa.1977), and Dupree v. Chattanooga, 362 F.Supp. 1136 (E.D.Tenn.1973). Both cases require plaintiffs to exhaust their administrative remedies prior to bringing a Title VI claim before a federal court.

Since these cases were decided, however, the Supreme Court rendered its decision in Cannon v. University of Chicago, 441 U.S. 677, 99 S.Ct. 1946, 60 L.Ed.2d 560 (1979), which, after acknowledging that Title IX "was patterned after Title VI", held that Title IX, like Title VI, affords a private cause of action. Id. at 694, 717, 99 S.Ct. at 1956, 1968. The Court also noted, although in dicta, that "we are not persuaded that individual suits are inappropriate in advance of exhaustion of remedies. Because the individual complainants cannot assure themselves that the administrative process will reach a decision on their complaints within a reasonable time, it makes little sense to require exhaustion." Id. at 706-08 n. 41, 99 S.Ct. at 1962-64 n. 41.

Courts interpreting the Cannon decision have explicitly applied it to Title VI claims and squarely hold that litigants need not exhaust their administrative remedies prior to bringing a Title VI claim in federal court. Doe on Behalf of Doe v. St. Joseph's Hospital, 788 F.2d 411, 426 (7th Cir.1986); Chowdhury v. Reading Hospital and Medical Center, 677 F.2d 317, 320-22 (3d Cir.1982), cert. denied, 463 U.S. 1229, 103 S.Ct. 3569, 77 L.Ed.2d 1411 (1983); Crest Street Community Council v. North Carolina Department of Transportation, 598 F.Supp. 258, 265-66 (M.D.N.C.1984), rev'd on other grounds, 769 F.2d 1025 (4th Cir.1985), rev'd, 479 U.S. 6, 107 S.Ct. 336, 93 L.Ed.2d 188 (1986); Concerned Tenants Association v. Indian Trails Apartments, 496 F.Supp. 522, 527 (N.D.Ill.1980). We agree with the reasoning of these courts.

Like Title IX, Title VI does not provide a mechanism by which the class protected by the statute can actively participate in the administrative process. Under such circumstances, requiring litigants to exhaust their administrative remedies would impose an undue hardship and delay upon their attempts to vindicate their rights. Rosado v. Wyman, 397 U.S. 397, 405-07, 90 S.Ct. 1207, 1214-15, 25 L.Ed.2d 442 (1970). Moreover, as the Supreme Court noted in Cannon, an administrative finding of a Title VI violation may not include relief for the claimant. 441 U.S. at 706 n. 40, 99 S.Ct. at 1962 n. 40. Accordingly, we hold that Title VI litigants need not exhaust their administrative remedies before pursuing their private cause of action in federal court. Thus, the district court's dismissal of the appellant's Title VI claim must be reversed.

Appellee contends that the district court's ruling should nevertheless be affirmed because Title VI claims do not permit a private cause of action for monetary damages and plaintiff's complaint, although requesting equitable relief in broad generalities, is really seeking monetary damages.

Whether Title VI remedies are limited to equitable relief is not as clearly established as appellee contends. In Guardians Association v. Civil Service Commission of New York, 463 U.S. 582, 103 S.Ct. 3221, 77 L.Ed.2d 866 (1983), Justice White concluded that "compensatory relief, or other relief based on past violations of the conditions attached to the use of the federal funds, is not available as a private remedy for Title VI actions not involving intentional discrimination." Id. at 602-03, 103 S.Ct. at 3232-33 (White, J.). This statement, however, earned the concurrence of only one other justice. See 463 U.S. at 612, 103 S.Ct. at 3237 (Rehnquist, J., concurring). Several lower courts have addressed the issue since the Supreme Court's decision in Guardians Association and have agreed with Justice White's opinion. See, e.g., Davis v. Spanish Coalition for Jobs, Inc., 676 F.Supp. 171 (N.D.Ill.1988); Storey v. Board of Regents of University of Wisconsin System, 604 F.Supp. 1200 (W.D.Wis.1985). The Supreme Court, however, has not yet resolved the issue, Consolidated Rail Corp. v. Darrone, 465 U.S. 624, 630-31 n. 9, 104 S.Ct. 1248, 1252-53 n. 9, 79 L.Ed.2d 568 (1984), and we need not address it. Appellants' claim seeks both equitable and monetary relief and, as such, it is sufficient to withstand a motion to dismiss.

B.

The district court dismissed app...