Taylor v. Cohen

• Decision Date: 05 December 1968
• Docket Number: No. 12770.,12770.
• Citation: 405 F.2d 277
• Parties: Edmund S. TAYLOR, James H. Sikes, Ed Carter, and E. A. Hall, for themselves individually, and as parents and guardians of children attending the public schools in Richland County School District Number One, and for all other persons similarly situated, Appellees, v. Wilbur COHEN, as Secretary of the Department of Health, Education and Welfare and Harold Howe II, as United States Commissioner of Education, Appellants.
• Court: U.S. Court of Appeals — Fourth Circuit

405 F.2d 277 (1968)

Edmund S. TAYLOR, James H. Sikes, Ed Carter, and E. A. Hall, for themselves individually, and as parents and guardians of children attending the public schools in Richland County School District Number One, and for all other persons similarly situated, Appellees, v. Wilbur COHEN, as Secretary of the Department of Health, Education and Welfare and Harold Howe II, as United States Commissioner of Education, Appellants.

No. 12770.

United States Court of Appeals Fourth Circuit.

Argued October 28, 1968.

Decided December 5, 1968.

Gary J. Greenberg, Atty., Dept. of Justice (Stephen J. Pollak, Asst. Atty. Gen., Nathan Lewin, Atty., Dept. of Justice, and Klyde Robinson, U. S. Atty., on brief) for appellants.

Harold W. Jacobs, N. Welch Morrisette and Charles W. Knowlton, Columbia, S. C. (Frank B. Gary, and Boyd, Bruton, Knowlton & Tate, Columbia, S. C., on brief) for appellees.

Before HAYNSWORTH, Chief Judge, and SOBELOFF, BOREMAN, BRYAN, WINTER, CRAVEN, and BUTZNER, Circuit Judges.

BUTZNER, Circuit Judge:

This appeal focuses on procedures for the termination of federal financial assistance under Title VI of the Civil Rights Act of 1964. It questions an injunction prohibiting the Department of Health, Education and Welfare from requiring a school district to assign pupils under any plan other than freedom of choice¹ and restraining the school board from adopting any other plan for the 1968-69 school year. We vacate the injunction and dismiss the complaint because we believe judicial intervention was premature.

I.

Richland County School District No. 1, which encompasses Columbia, South Carolina, and environs, receives approximately $2,000,000 of each year's funds from the federal government. It operates ten high schools, nine junior high schools, and forty-four elementary schools. Its 40,000 pupils are nearly equally divided between white and Negro. In the fall of 1964, twenty-two Negro pupils were admitted to formerly white schools. Prior to that time, the district had a completely segregated dual system. In 1965 the school board adopted a freedom of choice desegregation plan, which was approved by HEW. In the 1967-68 school year, 1,927 Negro pupils attended formerly white schools, and 3,135 Negro pupils were expected to enroll in them for the 1968-69 term.

In September 1967, officials of HEW advised the school board that its freedom of choice plan was not effective in achieving desegregation and that a new plan was necessary. During the following months the school board and HEW attempted, without success, to agree on a new plan. On April 22, 1968, HEW commenced administrative proceedings for the termination of federal funds and deferred consideration of funds for new programs. After further conferences, HEW suggested a zoning and pairing plan which the school board finally accepted. Later, however, severe public criticism of the new plan caused the board to reject provisions calling for the pairing of four schools. With this exception and other minor modifications, the district prepared to operate under the new plan in 1968-69.

In August 1968, parents of children attending some of the schools instituted this class action against the school board, the Secretary of HEW, and the Commissioner of Education. The complaint, invoking federal question jurisdiction 28 U.S.C. § 1331, alleged that the district's freedom of choice desegregation plan complied with the law and that the officials of HEW wrongfully coerced the school board to adopt another plan by threatening to terminate federal financial assistance. The district court, quite properly, took jurisdiction to hear the case because the controversy arose under the Constitution and laws of the United States. Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939 (1946). After a hearing, the court found that freedom of choice was the best educational plan for the district and that HEW's efforts to force the school board to abandon it were ultra vires. It entered an interlocutory injunction restraining the school board and the HEW officials "from instituting or requiring the institution of a plan other than the `Freedom of Choice' plan * * * for the school year 1968-69." At a special session of the court of appeals for this circuit, this order was stayed pending appeal.

II.

Section 601 of Title VI of the Civil Rights Act of 1964 42 U.S.C. § 2000d provides:

"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."

In order to secure rights found in § 601, while at the same time protecting state agencies from unwarranted federal intrusion, Congress enacted a comprehensive plan of enforcement. Section 602 of the Act 42 U.S.C. § 2000d-1 provides that compliance with § 601 may be effected by the termination of federal assistance.² But before an agency can terminate financial aid, it must determine that compliance cannot be secured by voluntary means and must afford an administrative hearing which results in an express finding that the recipient has failed to comply. Even then, termination does not become effective until 30 days after the filing of a report with appropriate congressional committees. Congress erected further safeguards in § 603 42 U.S.C. § 2000d-2 by providing for judicial review of departmental action.

The plaintiffs assert that the injunctive relief they seek can be obtained under the review provisions of the Administrative Procedure Act, 5 U. S.C. §§ 701-706. In Gardner v. State of Ala. for and in Behalf of Dept. of Pensions & Security, 385 F.2d 804 (5th Cir. 1967), cert. denied, 389 U.S. 1046, 88 S.Ct. 773, 19 L.Ed.2d 839 (1968), the relationship between the review under § 603³ and that provided by the Administrative Procedure Act was thoroughly analyzed. The court reached the conclusion, with which we agree, that if specific statutes relating to programs receiving federal assistance afford review of agency action, then review under the Administrative Procedure Act is not available. Here 20 U.S.C. §§ 241k, 585, and 869 provide review of HEW's action. These statutes allow review of final action only.⁴ Thus far HEW has taken only intermediate steps, including deferral of new applications,⁵ consultation, and negotiation. Its submission of the question of the district's compliance to a hearing examiner merely set the administrative machinery in motion. Final action is the decision to terminate or continue financial assistance. Until this decision has been made, judicial intervention is not sanctioned by statute.

Similarly, equity affords no basis for restraining HEW's intermediate actions. The exceptional nature of prior restraint is described in Wolf Corp. v. SEC, 115 U.S.App.D.C. 75, 317 F.2d 139, 142 (1963):

"Judicial power to impose prior restraint is not called an extraordinary remedy without reason. Even as between private parties the ordinary remedy is legal action after injury. Prior restraint is granted only upon a strong showing and is subject to definite and well established limitations. Prior restraint against governmental action, regular on its face and under color of authority, is even more cautiously exerted. Still higher hurdles stand in the way of prior restraint against the processes of a regulatory body exercising quasi-judicial powers which can be judicially reviewed as a matter of right before they become final. In this third category the jurisdiction of the regulatory or administrative body is exercised within the framework of a statutory scheme in which it acts as an arm of Congress; moreover it has established patterns of procedure and acts in a context where courts have long acknowledged a considerable deference to the specialized experience and competence of such a body. To exert judicial power to stop processes of this third category, which can always be judicially reviewed when the story is fully told and recorded, is an extraordinary step in the usual as well as the legally artful sense of that word. * * *

"* * * Such relief is to be very sparingly applied and is limited to cases where on its face the contemplated hearing or other administrative process, if consummated, would be set aside on review on procedural grounds."

The agency action set aside in Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed. 2d 210 (1958), on which the plaintiffs rely, differs from HEW's conduct here. In Leedom the National Labor Relations Board joined professional and nonprofessional employees in a bargaining unit without polling the professionals as the statute required. Because the NLRB had disregarded the procedure prescribed by statute, it was obvious that its action would have to be reversed upon review. Here, as we discuss in greater detail below, there has been no showing that HEW disregarded provisions of the Civil Rights Act of 1964.

We conclude, therefore, that neither a statutory nor an equitable basis exists for enjoining HEW's conduct at this stage of the proceedings. Judicial review must await the outcome of the administrative hearing.

III.

As an additional ground for the maintenance of this action, the plaintiffs urge that the injunction they seek is not directed against HEW, but only against the officials of the department who have exceeded their statutory power. By this argument they seek to lift the bar of sovereign immunity. In determining whether the officials' acts were ultra vires, we apply the rule of Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 695, 69 S.Ct. 1457, 1464, 93 L.Ed. 1628 (1949): "If the actions of an officer do not conflict with the terms of his valid statutory authority, then they are the actions of the sovereign * * *."⁶ The fact that the officer may have erred in exercising discretion does not deny immunity to the sovereign. "If * * * he is to act in the light of...