White Coat Waste Project v. Greater Richmond Transit Co.

• Decision Date: 20 May 2022
• Docket Number: 20-1710, No. 20-1740
• Parties: WHITE COAT WASTE PROJECT, Plaintiff - Appellee, v. GREATER RICHMOND TRANSIT COMPANY, Defendant - Appellant. White Coat Waste Project, Plaintiff - Appellant, v. Greater Richmond Transit Company, Defendant - Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

35 F.4th 179

WHITE COAT WASTE PROJECT, Plaintiff - Appellee,

v.GREATER RICHMOND TRANSIT COMPANY, Defendant - Appellant.

White Coat Waste Project, Plaintiff - Appellant,

v.Greater Richmond Transit Company, Defendant - Appellee.

No. 20-1710

No. 20-1740

United States Court of Appeals, Fourth Circuit.

Argued: September 21, 2021

Decided: May 20, 2022

Richard Earl Hill, Jr., OFFICE OF THE CITY ATTORNEY – RICHMOND, Richmond, Virginia, for Appellant/Cross-Appellee. Matthew Daniel Strugar, LAW OFFICE OF MATTHEW STRUGAR, Los Angeles, California, for Appellee/Cross-Appellant.

Before GREGORY, Chief Judge, and NIEMEYER and RICHARDSON, Circuit Judges.

Affirmed in part, reversed in part, and remanded with instructions by published opinion. Judge Richardson wrote the opinion, in which Chief Judge Gregory and Judge Niemeyer joined.

RICHARDSON, Circuit Judge:

When White Coat Waste Project tried to run an advertisement denouncing animal experimentation with the Greater Richmond Transit Company, the ad was denied for being impermissibly "political." So White Coat sued, challenging that denial as a violation of its First Amendment rights. Richmond Transit responds that, as a private company, it is not bound by the First Amendment, and even if it were, its policy passes constitutional muster because it only restrains speech in a nonpublic forum. The district court disagreed on both counts, concluding that Richmond Transit is a state actor subject to constitutional constraints and that its policy violates the First Amendment right to free speech. But the district court granted White Coat only partial summary judgment, holding that it could not provide the facial relief White Coat sought because public-transit political-advertising bans can sometimes accord with the Constitution. See Lehman v. City of Shaker Heights , 418 U.S. 298, 303–04, 94 S.Ct. 2714, 41 L.Ed.2d 770 (1974) (plurality opinion).

We conclude that the district court correctly identified Richmond Transit as a state actor. See Lebron v. Nat'l R.R. Passenger Corp. , 513 U.S. 374, 400, 115 S.Ct. 961, 130 L.Ed.2d 902 (1995). And we hold that Richmond Transit's policy is not "capable of reasoned application" and is therefore unconstitutionally unreasonable. See Minn. Voters All. v. Mansky , ––– U.S. ––––, 138 S. Ct. 1876, 1892, 201 L.Ed.2d 201 (2018). Finally, we hold that the district court erred in denying facial relief. Even if another public-transit political-advertising ban may be constitutional, this ban is incapable of reasoned, constitutional application in all circumstances. So it is facially unconstitutional and warrants facial relief.

I. Background

Richmond Transit operates a public transit system in Richmond and the surrounding areas. The corporation was formed in 1973, when Virginia amended Richmond's charter to enable it to "acquire, operate, lease, or otherwise provide for the operation of a public transportation system ... both within and outside the City of Richmond." Act of March 15, 1973, ch. 348, 1973 Va. Acts 472, 476. The City then enacted a resolution authorizing a slate of incorporators "to form a stock corporation known as ‘Greater Richmond Transit Company’ ... for the purpose of providing mass transportation service as a public service corporation," and empowering the city attorney "to do all other necessary things to bring such corporation into being." Council Res. 73-R44-45, 1973 Council (Richmond, Va. 1973) (saved as ECF opinion attachment). The slate of incorporators then incorporated Richmond Transit under the general corporate law of Virginia. Richmond Transit acquired the assets of the flagging Virginia Transit Company and has operated as Richmond's conveyor of public transit ever since. At first, Richmond retained all shares of the corporation and the authority to appoint all six members of the Board of Directors, but later it granted half of its ownership and three seats on the Board to nearby Chesterfield County.

Like many transit companies, Richmond Transit derives revenue from selling advertising space on its buses. Advertisers must comply with Richmond Transit's advertising policy, which prohibits, for example, alcohol and tobacco advertisements, advertisements for pornography, advertisements containing vulgarity, and (most relevant here) "[a]ll political ads." J.A. 159 (2013 advertising policy); J.A. 156 (2018 advertising policy). Richmond Transit's policy declares its "intent not to allow any of its transit vehicles or property to become a public forum for dissemination, debate, or discussion of public issues." J.A. 156, 159. But the policy fails to define what could constitute "political ads" or "public issues."

Richmond Transit generally uses an outside contractor to sell its advertising space. If that contractor believes an ad may violate the advertising policy, it must submit the ad to Richmond Transit for review. Those submissions go to the Director of Communications, Carrie Rose Pace. According to Pace, an advertisement will be rejected as political if it is "not viewpoint neutral"—i.e., any ad "expressing a viewpoint and only that viewpoint." J.A. 231. And any advertisement from what it calls a "political action group"—i.e., any group that "engage[s] in a specific targeted policy advocacy that would be related to their one side of the political issue"—is prohibited. J.A. 263. To determine whether a group is a political action group, Pace may review the organization's website.

Implementing the political-ad policy has required making some difficult decisions. Richmond Transit has run advertisements for the vice-presidential debate, a free-expression exhibit at an art museum, and an anti-dog-fighting nonprofit asking readers to spay and neuter their dogs. It rejected an advertisement from the Physicians Committee for Responsible Medicine encouraging local hospitals to "go #FastFoodFree!" and readers to "EAT MORE CHICKPEAS!," and another from a hospital association advocating for increased government healthcare funding. J.A. 294–95, 302–04, 381.

White Coat is a nonprofit seeking to end taxpayer-funded animal experimentation. It sought to run an ad on Richmond Transit's buses targeting the local McGuire Veterans Affairs Medical Center. The advertisement features three dogs peering out of what appear to be prison bars, along with the text: "Prisoners of Waste—McGuire VAMC: Stop Taxpayer-Funded Dog Experiments!" J.A. 388. In small print in the bottom-left corner, the advertisement states: "White Coat Waste Project." J.A. 388. Pace reviewed White Coat's website and determined that White Coat was a political action group, so she rejected the advertisement. Richmond Transit informed White Coat that if it partnered with the local government, it might be able to run the ad as a "public service advertisement." J.A. 411.

White Coat instead sued Richmond Transit under 42 U.S.C. § 1983, asserting that Richmond Transit's prohibition on political advertising infringes their freedom of speech under the First Amendment.¹ The Complaint sought (1) a declaratory judgment that the political-advertising ban was unconstitutional, both facially and as applied to White Coat; (2) an injunction requiring Richmond Transit to accept White Coat's advertisement on terms no less favorable than those given to other advertisers; and (3) an injunction barring enforcement of the political-advertisement prohibition.

Following discovery, the district court granted partial summary judgment to White Coat. First, the court held that Richmond Transit could be sued under § 1983 as it acted under the color of state law in rejecting White Coat's advertising. Then the court held that the policy was unconstitutional as applied to White Coat under the First Amendment and enjoined Richmond Transit from applying the prohibition to White Coat. But the court rejected the facial challenge, granting partial summary judgment to Richmond Transit on that claim. White Coat Waste Project v. Greater Richmond Transit Co. , 463 F. Supp. 3d 661, 713 (E.D. Va. 2020). The parties cross-appealed. We have jurisdiction over the district court's final judgment. See 28 U.S.C. § 1291.²

II. Discussion

We begin with the state-action issue and hold that Richmond Transit is a state actor operating "under color of state law." See West v. Atkins , 487 U.S. 42, 48, 108 S.Ct. 2250, 101 L.Ed.2d 40 (1988). Richmond Transit is therefore subject to suit under § 1983. We then hold that its political-ad ban violates the First Amendment.

A. State Action and Color of State Law

Like many constitutional provisions, "the Free Speech Clause prohibits only governmental abridgment of speech," not "private abridgement of speech." Manhattan Cmty. Access Corp. v. Halleck , ––– U.S. ––––, 139 S. Ct. 1921, 1928, 204 L.Ed.2d 405 (2019). So courts must ensure "that constitutional standards" such as the First Amendment are only enforced "when it can be said that the State is responsible for the specific conduct of which the plaintiff complains"—a requirement known as "state action." Brentwood Acad. v. Tenn. Secondary Sch. Athletic Ass'n , 531 U.S. 288, 295, 121 S.Ct. 924, 148 L.Ed.2d 807 (2001) (emphasis omitted) (quoting Blum v. Yaretsky , 457 U.S. 991, 1004, 102 S.Ct. 2777, 73 L.Ed.2d 534 (1982) ). Alongside the constitutional state-action limitation, § 1983 contains a distinct color-of-law requirement. See West , 487 U.S. at 48, 108 S.Ct. 2250. The statute applies, by its terms, only to a "person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory" deprives a person of a constitutional or statutory right, privilege, or immunity. 42 U.S.C. § 1983. A person, which includes a corporation, acts "under color of" state law when they exercise "power ‘possessed by virtue of state law and made possible only because the wrongdoer is clothed with the authority of state law.’ " West , 487 U.S. at 49, 108 S.Ct. 2250 (quoting United States v. Classic , 313 U.S. 299, 326, 61 S.Ct. 1031, 85 L.Ed. 1368...