Ritchey Produce Co. v. State (85 Ohio St. 3d 194, 1999)

Douglas, J.

As a preliminary matter, we note that appellee and amici raise a number of arguments that tend to confuse rather than to clarify the issues presented by this appeal. Therefore, it is necessary to dispel some of this confusion before proceeding to the primary issue raised in this appeal, to wit, whether Ohio’s MBE Program, as administratively applied and as written, violates the equal protection guarantees of the Fourteenth Amendment to the United States Constitution.

I

In its brief, ODAS correctly notes that racial classifications of the type set forth in R.C. 122.71(E)(1) must be analyzed under strict scrutiny. The reason, of course, is that “government may treat people differently because of their race only for the most compelling reasons.” Adarand Constructors, Inc. v. Pena (1995), 515 U.S. 200, 227, 115 S.Ct. 2097, 2113, 132 L.Ed.2d 158, 182. Under strict scrutiny, governmental classifications based on race, even purportedly “benign” or “remedial” racial classifications of the type at issue here, are constitutional only if they are “narrowly tailored measures that further compelling governmental interests.” Id. Accordingly, in its first proposition of law, ODAS argues that Ohio’s MBE set-aside program satisfies both prongs of strict scrutiny, to wit, there was a compelling governmental interest for the adoption of the MBE program, and the program is narrowly tailored to meet that interest. As a necessary part of this argument, ODAS has explored, at some léngth, the facts and history that gave rise to the enactment of Ohio’s MBE program. In its second proposition of law, ODAS argues that the administrative determination denying appellee’s application for MBE recertification was correct, since the owner of the business, Ritchey, is clearly not “Oriental” within the meaning of R.C. 122.71(E)(1). On the basis of these two propositions, ODAS seeks reversal of the judgment of the court of appeals and reinstatement of the administrative adjudication order denying the request for MBE recertification of Ritchey Produce.

In response to ODAS’s first proposition of law, appellee argues that ODAS’s entire analysis concerning the constitutionality of Ohio’s MBE program raises issues that were neither argued nor decided in the courts below. Specifically, in its merit brief, appellee contends: “The State argues in its first proposition of law the facial validity of its MBE program and the underlying State interests. Accordingly, the State spends an inordinate amount of time arguing its compelling interest for legislating such a program. However, Ritchey Produce never challenged the facial validity of the State’s MBE program and concedes the State’s compelling interest in creating a ‘disadvantaged business enterprise’ program.” In addition, appellee argues that it never challenged the validity of Ohio’s MBE program but “instead challenged how ODAS reversed its policy and decertified Ritchey Produce on race per se.” Appellee concludes, therefore, that “[a]s the lower courts never considered either a record or arguments on the validity of the State’s underlying interest in creating its MBE program, the State improperly raises these issues before this Court,” and ODAS’s first proposition of law should be stricken.

We disagree with Ritchey Produce’s claim that ODAS’s first proposition of law should be stricken. Rather, we find that strict scrutiny requires consideration of the type of issues that’have been briefed and argued by ODAS in its first proposition of law. That is, the question whether the MBE program is narrowly tailored to further a compelling governmental interest necessarily requires consideration of the compelling interest that gave rise to the program’s creation, ie., the requirements of a compelling interest and narrowly tailored means go hand in hand. Further, appellee’s concession that the state had a compelling interest to enact a disadvantaged business enterprise program underscores the fact that appellee does not fully comprehend the nature and character of Ohio’s MBE program. This fact becomes all the more apparent when appellee’s arguments are considered in detail.

Appellee claims that the MBE program, specifically, R.C. 122.71, “expressly creates a ‘disadvantaged business enterprise’ program.” In connection with this argument, appellee has gone to great lengths in an attempt to convince us that ODAS changed its policy on MBE certifications between the time appellee was originally granted certification in 1991 and the time appellee’s request for recertification was denied in April 1996. According to appellee, “in April 1996, ODAS reversed its course with no change in fact or law, and decertified Ritchey Produce based on the sole criterion] that Ritchey Produce racially does not meet the State’s latest definition of ‘Oriental.’ ” Appellee suggests that “[wjhile prior to this time ODAS based MBE determinations upon whether the applicant qualified as ‘socially or economically disadvantaged’ as described in the statute, ODAS unconstitutionally altered its administration of its MBE program to focus on race per se.” (Emphasis added.)

We find that appellee’s arguments misconstrue the language, nature, and character of Ohio’s MBE program. R.C. 122.71(E)(1) defines “minority business enterprise” as a business that is owned and controlled by persons “of the following economically disadvantaged groups: Blacks, American Indians, Hispanics, and Orientals.” (Emphasis added.) Apparently, appellee believes that a plain reading of the statute requires ODAS to consider whether an applicant for MBE certification is socially or economically disadvantaged and to certify businesses that demonstrate disadvantage regardless of the business oumer’s race. That is, appellee reads R.C. 122.71(E)(1) as including in the definition of “minority business enterprise” businesses that are owned and controlled by members of the four groups specifically listed in the statute and any other businesses that can demonstrate economic disadvantage. However, R.C. 122.71(E)(1) clearly does not say that. Rather, under the plain terms of the statute, the four groups listed in R.C. 122.71(E)(1) are considered to be “economically disadvantaged groups,” and only businesses owned and controlled by members of the specified groups are capable of satisfying the statutory definition of “minority business enterprise.”

Moreover, appellee’s position that R.C. 122.71(E)(1) plainly creates a disadvantaged-business-enterprise program — ie., one which benefits, inter alia, groups or individuals that fall outside the racial classification and that demonstrate economic disadvantage — is completely untenable in light of the legislative history of R.C.. 122.71(E)(1). Specifically, that statute was originally enacted in 1980 as part of Am.Sub.H.B. No. 584, 138 Ohio Laws, Part II, 3062, 3065. As originally enacted, former R.C. 122.71(E)(1) provided: “ ‘Minority business enterprise’ means an individual, partnership, corporation, or joint venture of any kind that is owned and controlled by United States citizens, residents of Ohio, who are members of an economically disadvantaged group including, but not limited to, the following groups: Blacks, American Indians, Hispanics, and Orientals.” (Emphasis added.) Id. In 1981, the above-emphasized portion of the statute was altered by amendment, and the following language was inserted in its place: “one of the following economically disadvantaged groups: Blacks, American Indians, Hispanics, and Orientals.” 139 Ohio Laws, Part II, 3166 and 3506. Obviously, the 1981 amendment to R.C. 122.71(E)(1) evinces a clear legislative intention not to include in the definition of “minority business enterprise” any businesses owned and controlled by members of any group other than the four specific groups listed in the statute.

Further, to accept appellee’s interpretation of the statute would essentially require us to rewrite it and to enact a new MBE program that benefits all disadvantaged businesses, thereby changing the MBE program into a disadvantaged-business-enterprise program. However, Ohio’s MBE program was clearly designed to serve a far different purpose from the one appellee suggests it should now serve. Given the plain language of R.C. 122.71(E)(1) and its history, we are in no position to modify the clear and unambiguous terms of the statute by rewriting it, under the guise of judicial interpretation, to make it say something far different from what the statute actually says and means. This court is not now, nor has it ever been, a judicial legislature. When a statute is assailed as unconstitutional, it is our duty to liberally construe it to save the statute from constitutional infirmities. See, e.g., Wilson v. Kennedy (1949), 151 Ohio St. 485, 492, 39 O.O. 301, 304, 86 N.E.2d 722, 725. However, that duty does not entail our having to rewrite a statute so as to give it an entirely new meaning, particularly where the new meaning would utterly oppose the purposes for which the statute was enacted.

Appellee also claims, and the court of appeals apparently agreed, that former Equal Employment Opportunity Coordinator Booker T. Tall had granted MBE certification to appellee in 1991 based solely on a determination that appellee was a “disadvantaged business” enterprise. To support this argument, appellee relies on Tail’s 1992 deposition in an unrelated case. Armed with this deposition, appellee argues that “[wjhen Ritchey Produce first applied [for MBE certification], ODAS correctly certified any business demonstrating actual ‘social or economic disadvantage,’ thus certifying MBE’s on a case-by-case basis. According to the sworn deposition testimony of State EEOC Coordinator Booker T. Tall (the same coordinator who first certified Ritchey Produce as an MBE), determinations of whether a business qualified for MBE status rested upon whether the business qualified as a ‘disadvantaged business enterprise,’ not whether the business fit neatly into the listed racial categories of Black, Hispanic, American Indian, or Oriental.” (Emphasis sic.)

We have reviewed Tail’s deposition testimony in its entirety, and we find that it does not fully support appellee’s contentions. Nor does the deposition fully support the conclusions of the court of appeals on this issue. The testimony indicates that, during Tail’s tenure as Equal Employment Opportunity Coordinator, applications for MBE certification were reviewed to determine whether each applicant was an “economically disadvantaged” enterprise. The testimony also indicates, however, that MBE certifications were issued by Tall only upon a determination that directly linked the ownership and control of the business to members of one of the four specific racial or ethnic groups listed in R.C. 122.71(E)(1). Thus, it appears, when Tall originally granted MBE certification to appellee, the certification was premised upon a determination that Ritchey, the owner of the company, was Oriental. Precisely how Tall could have reached that conclusion remains a mystery. Perhaps he construed the term “Oriental” to include a person of Lebanese descent, or perhaps he never thoroughly reviewed appellee’s original application for MBE certification, wherein Ritchey indicated, among other things, that he was Lebanese. In any event, as the magistrate noted at the trial court level, “under [DLZ Corp. v. Ohio Dept. of Adm. Serv. (1995), 102 Ohio App.3d 777, 658 N.E.2d 28] and the law as technically written, and previously applied, Ritchey Produce was mistakenly certified as an MBE from the beginning.” (Emphasis added.) Moreover, even if Tall did purposely certify MBEs regardless of race, that practice clearly does not comport with the language and purposes of R.C. 122.71(E)(1).

There is also some evidence in the record (namely, Ritchey’s affidavit) that when Ritchey first applied for MBE certification, an employee of the state’s Equal Employment Opportunity Coordinator’s Office had interviewed Ritchey and had instructed him to fill out the application form by “checking] the box under ‘racial/ethnic group’ that most closely related to [Ritchey’s] nation of origin.” Since there were only four racial groups from which Ritchey could chose, i.e., Black, Hispanic, American Indian, and Oriental, Ritchey chose “Oriental” and marked the application accordingly. Appellee claims to have made that choice because the term “Oriental” was consistent with his “traditional understanding” that the term included people of Lebanese descent. Ritchey also asserts that he did not arrive at that decision himself and implies that the interviewer, by directing him to choose one of the four possible options on the application form, had participated in that decision. However, to the extent that the interviewer did participate in the conclusion that Ritchey was Oriental (and, incidentally, there is no proof that the interviewer did so), that conclusion was clearly incorrect. See our discussion in Part VII, below. Moreover, there is simply no proof that the actions of the employee or employees who interviewed Ritchey represent a department-wide policy of certifying MBEs regardless of the business owner’s race. The decision to approve the original application for MBE certification was Tail’s decision to make, and we have already stated our views concerning his deposition testimony. Although Ritchey apparently never intended to deceive anyone with respect to his race or ethnicity, the fact that Ritchey Produce was certified as an Oriental-owned MBE appears to have resulted from a series of errors.

Appellee also relies heavily on Adarand, 515 U.S. 200, 115 S.Ct. 2097, 132 L.Ed.2d 158, for the proposition that racial classifications of the type in R.C. 122.71(E)(1) can never be applied to deny MBE certification on the basis of race per se. Appellee contends that “according to Adarand and as found by the court of appeals, while race may be used as a rebuttable presumption of economic disadvantage, nothing justifies the State to exclude per se other races, when they can demonstrate actual disadvantage.” Similarly, appellee suggests that “Ada-rand requires that to constitutionally enforce the MBE program the State must base its eligibility determinations on actual and social economic disadvantage,” so that appellee must be admitted to the program upon proof of disadvantage.

However, neither Adarand nor any other decision of the United States Supreme Court specifically indicates that such a blanket constitutional principle exists with respect to remedial race-based state action that is necessary to serve compelling governmental interests, and that is narrowly tailored to the achievement of that objective. What Adarand does hold is that all governmental classifications based on race must satisfy the strict scrutiny standard of review, so that racial classifications will be deemed constitutional only if they are narrowly tailored measures that further compelling governmental interests. Id. at 227, 115 S.Ct. at 2113, 132 L.Ed.2d at 182; see, also, our discussion in Part II, below. The entire point of Adarand was to make explicit that federal racial classifications, like those of a state, are subject to the strict scrutiny standard of review. Id. at 235, 115 S.Ct. at 2117, 132 L.Ed.2d at 187; see, also, our discussion in Part II, below. Moreover, the court in Adarand remanded the matter at issue there to the lower federal courts for analysis under strict scrutiny. Id. at 237-239, 115 S.Ct. at 2118, 132 L.Ed.2d at 188-189; see, also, our discussion in Part II, below. Thus, in Adarand, the United States Supreme Court did not conduct strict scrutiny itself and did not determine whether strict scrutiny was satisfied on the facts of that particular case.

Appellee also cites certain executive orders that were issued by Governor George V. Voinovich in 1996 and 1997, specifically, Executive Order 96-53V (entitled “Socially and Economically Disadvantaged Business Policy”), and Executive Order 97-14V (entitled “Historically Underutilized Business Policy”). These executive orders indicate a policy of the state with respect to the certification of disadvantaged business enterprises (now called “historically underutilized business enterprises”) on the basis of social and economic disadvantage. Appellee claims that “[t]hese current policy changes in compliance with Adarand are admissions by the State that it recognizes the United States Supreme Court dictate that ‘disadvantaged business’ programs must be based on social and economic disadvantage, and not on race per se.” However, these executive orders deal with policies that differ from the nature and purpose of the MBE program. ODAS contends, and we agree, that the former Governor’s programs merely supplement, but do not supplant, the MBE program. Moreover, we do not view these executive orders as supporting the conclusions that appellee attempts to draw from them. As we indicated in our discussion immediately above, Adarand holds that all racial classifications, whether imposed by federal, state, or local government, are subject to strict scrutiny. Id., 515 U.S. at 227, 115 S.Ct. at 2113, 132 L.Ed.2d at 182. By virtue of the decision in Richmond v. J.A. Croson Co. (1989), 488 U.S. 469, 109 S.Ct. 706, 102 L.Ed.2d 854, it has been known since 1989 that Ohio’s MBE program, if challenged, would be subject to strict scrutiny. See our discussion in Part II, below. Adarand merely placed the federal government in the same boat as state and local governments in terms of the applicability of strict scrutiny to benign or remedial race-based governmental actions. Therefore, for this and other reasons, appellee’s claim that the former Governor’s executive orders were a measured response to the Adarand decision is unconvincing.

As to ODAS’s second proposition of law, appellee contends that the question whether Ritchey is Oriental is irrelevant, since, according to appellee, Adarand requires that businesses must be admitted into the program on the basis of actual and social economic disadvantage. Appellee also claims that “Ritchey qualifies under the definition of ‘Oriental’ as originally reviewed and certified by the State, or as should be properly administered now.” Therefore, appellee maintains that Ritchey is Oriental, even though Ritchey admitted to the trial court’s magistrate that he is not Oriental.

To complicate matters further, amici enter the fray by urging us to consider ODAS’s propositions of law in reverse order, i.e., to address the second proposition of law first, and the first proposition of law second. With respect to ODAS’s second proposition of law, amici claim that Ritchey is Oriental — although he clearly is not. Nevertheless, amici urge that construing the term “Orientals” in R.C. 122.71(E)(1) in accordance with rules of grammar and common usage, the term clearly includes within its meaning individuals of Lebanese descent. With respect to ODAS’s first proposition of law, amici urge us to uphold R.C. 122.71(E)(1) as a constitutional exercise of legislative authority.

In reply to the arguments of appellee and of appellee’s supporting amici, ODAS points out that appellee’s arguments in this case have been specifically calibrated “to save the program for [appellee’s] benefit, while disregarding the impact on all other MBEs — that is, if [appellee] cannot be certified under the existing program, then no company can.” ODAS notes that the controversy in this case arose simply because ODAS had adhered to the plain language of R.C. 122.71(E)(1) in denying appellee’s application for recertification. ODAS observes that, despite this fact, appellee now “argues that the facial validity of the MBE program is not at issue” and “that the only constitutional question before the Court is whether the statute is constitutional as applied only to it.” ODAS contends that appellee’s arguments indicate that appellee “does not seek to participate in the Ohio MBE program as that program is statutorily structured and as it is currently applied,” and that “[i]nstead, Ritchey asks the Court to grant him the benefit of a different program, one that would rely not on his race, but on his economic or social disadvantage, presumably arising in some way from his race.” (Emphasis sic.) We agree with ODAS’s summary:

“In the final analysis, the semantics of whether the Court of Appeals decision presents a ‘facial’ or ‘as applied’ constitutional challenge to the MBE program are not critical. Nor is it critical for the Court to consider the issues presented in a particular order. What is critical is for the Court to consider, in full view, the State’s compelling interest in redressing state-sponsored racial discrimination and its narrow tailoring of a program [the MBE program] to meet that interest.”

II

Having set forth the arguments raised in this appeal, we now consider the precedents governing the determination whether Ohio’s MBE program, specifically, R.C. 122.71(E)(1), violates the Equal Protection Clause of the Fourteenth Amendment. For the past twenty years, the United States Supreme Court has struggled with the tension between the Fourteenth Amendment guarantee of equal protection of citizens and the use of race-based measures imposed by governmental actors to ameliorate the effects of past discrimination on minority groups in society. -Beginning with Regents of the Univ. of California v. Bakke (1978), 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750, and continuing through Adarand, 515 U.S. 200, 115 S.Ct. 2097, 132 L.Ed.2d 158, the United States Supreme Court has written volumes on the subject. Over the course of the years, the court resolved the once-embattled question concerning the appropriate standard of review for benign or remedial race-based governmental action, finding that the standard for all governmental classifications based on race is the strict scrutiny standard of review. See Adarand, 515 U.S. at 227, 115 S.Ct. at 2113, 132 L.Ed.2d at 182. See, also, Croson, 488 U.S. 469, 109 S.Ct. 706, 102 L.Ed.2d 854. However, any discussion of benign or remedial race-based governmental action would be incomplete without a full review of the United States Supreme Court’s major pronouncements on the issue beginning with the court’s 1978 landmark decision in Bakke.

As we enter into our review of the opinions of the United States Supreme Court on the subject of remedial race-based governmental action, we first note that the cases are both difficult and complex. In conducting our analysis, we set forth a summary of the high court’s pronouncements. While our discussion tends to be lengthy, we find it necessary for our decisionmaking in this case.

The issue in Bakke, 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750, involved a special admissions program of the Medical School of the University of California at Davis. The special admissions program was designed by the faculty to ensure the admission of a specified number of disadvantaged students from certain minority groups. The special program operated in coordination with a regular admissions program. When Bakke was decided, no disadvantaged Caucasian applicants had ever been admitted to medical school under the special admissions program, though many apparently had applied. Allan Bakke, a white male, applied for admission to the medical school in 1973 and 1974. In both years, Bakke’s application was reviewed under the regular admissions program and was rejected. In both years, applicants from the special program were admitted with scores lower than Bakke’s. After the second rejection, Bakke filed suit in state court, seeking declaratory and injunctive relief, claiming, among other things, that the special admissions program had operated to exclude him from medical school on the basis of his race in violation of the equal protection guarantees of the Fourteenth Amendment.

Bakke won a hollow victory at the trial court level. The trial court held that the challenged admissions program was unconstitutional and that the medical school could not consider race as part of its admissions decisions. However, the trial court refused to order Bakke’s admission, finding that Bakke had failed to prove that he would have been admitted but for the special program. The state Supreme Court, applying the strict scrutiny standard of review, affirmed the trial court’s finding that the special admissions program violated the Equal Protection Clause but also directed the trial court to order Bakke’s admission to the school. Thereafter, the United States Supreme Court granted certiorari to consider the constitutional issue.

In Bakke, 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750, the United States Supreme Court affirmed the judgment of the state Supreme Court that Bakke was entitled to admission, but reversed insofar as the courts below had prohibited the school from establishing a race-conscious program in the future. Bakke resulted in many different opinions of the Justices, with no single opinion speaking for the court. However, in Justice Powell’s opinion announcing the judgment in Bakke, in a section joined by Justice White, he rejected an argument that strict scrutiny should be reserved for classifications that disadvantage “discrete and insular minorities.” Id. at 287-291, 98 S.Ct. at 2746-2748, 57 L.Ed.2d at 769-771. In the same section, Justice Powell stated, “The guarantee of equal protection cannot mean one thing when applied to one individual and something else when applied to a person of another color. If both are not accorded the same protection, then it is not equal.” Id. at 289-290, 98 S.Ct. at 2748, 57 L.Ed.2d at 770-771. Justice Powell also determined that racial and ethnic distinctions of any sort are “inherently suspect and thus call for the most exacting judicial examination.” Id. at 291, 98 S.Ct. at 2748, 57 L.Ed.2d at 771. Additionally, Justice Powell, speaking for himself, observed that where a classification touches upon an individual’s race or ethnic background, that person “is entitled to a judicial determination that the burden he is asked to bear on that basis is precisely tailored to serve a compelling governmental interest.” (Emphasis added.) Id. at 299, 98 S.Ct. at 2753, 57 L.Ed.2d at 777.

Justice Powell’s opinion in Bakke is of great historic significance in that it built a foundation upon which the court’s future cases would be grounded. Therefore, a detailed discussion of that opinion is in order.

Justice Powell’s opinion in Bakke considered four possible objectives of the special admissions program, none of which was found to justify the program under strict scrutiny. Id., 438 U.S. at 305-319, 98 S.Ct. at 2756-2763, 57 L.Ed.2d at 781-789. With respect to the first asserted purpose (reducing the historic deficit of minorities in medical schools and the medical profession), Justice Powell noted, “Preferring members of any one group for no reason other than race or ethnic origin is discrimination for its own sake.” Id. at 307, 98 S.Ct. at 2757, 57 L.Ed.2d at 782.

As to the second purpose asserted in Bakke to justify the special admissions program (counteracting “societal discrimination”), Justice Powell observed that a state clearly has an interest in ameliorating the effects of identified discrimination but that the goal of remedying the effects of historic societal discrimination, “an amorphous concept of injury that may be ageless in its reach into the past,” did not justify imposing a burden on Bakke. Id., 438 U.S. at 307, 307-310, 98 S.Ct. at 2757, 2757-2758, 57 L.Ed.2d at 782, 782-784. Justice Powell stated, “We have never approved a classification that aids persons perceived as members of relatively victimized groups at the expense of other innocent individuals in the absence of judicial, legislative, or administrative findings of constitutional or statutory violations.” Id. at 307, 98 S.Ct. at 2757, 57 L.Ed.2d at 782. He also stated that only after such findings are made can a governmental classification preferring members of the injured groups at the expense of others be justified as remedial, and that, in such cases, the extent of the injury and the scope of the remedy will have been appropriately defined. Id. at 307-308, 98 S.Ct. at 2757, 57 L.Ed.2d at 782. He stated that absent such findings of statutory or constitutional violations, “it cannot be said that the government has any greater interest in helping one individual than in refraining from harming another,” and the government would therefore have no compelling justification for inflicting such harm. Id. at 308-309, 98 S.Ct. at 2757-2758, 57 L.Ed.2d at 782-783. Justice Powell went on to say, “[A] governmental body must have the authority and capability to establish, in the record, that the classification is responsive to identified discrimination.” Id. at 309, 98 S.Ct. at 2758, 57 L.Ed.2d at 783. He concluded that because the medical school had made no explicit findings of identifiable discrimination, and since the school’s mission was education and not the formulation of any legislative policy or the adjudication of particular claims of illegality, the petitioner had failed to carry its burden of justification on that issue. Id. at 309-310, 98 S.Ct. at 2758, 57 L.Ed.2d at 783.

With respect to the third purpose asserted by the petitioner in Bakke to justify the special admissions program (to increase the number of doctors serving disadvantaged communities), Justice Powell concluded that the petitioner had made no showing that the special admissions program was either needed or geared to promote that goal. Id., 438 U.S. at 310-311, 98 S.Ct. at 2758-2759, 57 L.Ed.2d at 784. As to the fourth asserted objective for the program (attainment of an ethnically diverse student population), Justice Powell noted that although the medical school had a compelling interest in achieving a diverse student body, the means it had chosen to effectuate that goal — ie., a fixed admissions quota system — was not appropriate. Id. at 311-320, 98 S.Ct. at 2759-2763, 57 L.Ed.2d at 785-790.

In his opinion in Bakke, Justice Powell concluded, “The fatal flaw in petitioner’s preferential program is its disregard of individual rights as guaranteed by the Fourteenth Amendment. * * * Such rights are not absolute. But when a State’s distribution of benefits or imposition of burdens hinges on ancestry or the color of a person’s skin, that individual is entitled to a demonstration that the challenged classification is necessary to promote a substantial state interest. Petitioner has failed to carry this burden.” Id. at 320, 98 S.Ct. at 2763, 57 L.Ed.2d at 790. Therefore, on that basis, Justice Powell found that it was necessary to affirm the portion of the California court’s judgment that had invalidated the special admissions program under the Fourteenth Amendment. Id. That conclusion, when coupled with the views expressed in the opinion of Justice Stevens (see discussion below), provided a clear majority in Bakke for invalidating the special admissions program. However, Justice Powell (joined by Justices Brennan, White, Marshall, and Blackmun) found that by prohibiting petitioner from considering the race of any applicant as a factor in admissions, the California courts had failed to recognize that “the State has a substantial interest that legitimately may be served by a properly devised admissions program involving the competitive consideration of race and ethnic origin.” Id. at 320, 98 S.Ct. at 2763, 57 L.Ed.2d at 790. For that reason, it was determined that “so much of the California court’s judgment as enjoins petitioner from any consideration of the race of any applicant must be reversed.” Id. Finally, on the question of Bakke’s right to an injunction requiring his admission to the medical school, Justice Powell announced the judgment affirming that aspect of the state court’s decision. Id. at 320, 98 S.Ct. at 2763-2764, 57 L.Ed.2d at 790.

As previously stated, Bakke produced many opinions by the Justices, but no single opinion on behalf of the court. Thus, Justice Powell’s opinion on the constitutional question spoke only of Justice Powell’s own views of the case, except in certain limited instances. In addition to Justice Powell’s opinion, four Justices in Bakke found that a less stringent standard of review should be applied to racial classifications that have been designed to further remedial purposes and, in applying that standard, found that the special admissions program was constitutional in all respects. Id., 438 U.S. at 324-379, 98 S.Ct. at 2765-2794, 57 L.Ed.2d at 792-827 (Brennan, White, Marshall, and Blackmun, JJ., concurring in judgment in part and dissenting in part). The less stringent standard proposed by these four Justices was an intermediate level of scrutiny — i.e., racial classifications designed to further remedial purposes must serve important governmental objectives and must be substantially related to the achievement of those objectives. Id. at 359, 98 S.Ct. at 2783, 57 L.Ed.2d at 814. Conversely, four other Justices in Bakke would have decided the case by affirming the judgment of the Supreme Court of California solely on statutory grounds, finding that the program violated Title VI of the Civil Rights of 1964 by excluding Bakke from the medical school on the basis of race. Id., 438 U.S. at 408-421, 98 S.Ct. at 2808-2815, 57 L.Ed.2d at 845-853 (Stevens, J., joined by Burger, C.J., Stewart, and Rehnquist, JJ., concurring in judgment in part and dissenting in part). Thus, in 1978, Bakke provided limited guidance to the nation on the constitutionality of purportedly remedial race-based governmental action.

Two years later, in 1980, the United States Supreme Court confronted a case involving a congressional spending program that established a remedial set-aside plan for the benefit of minority business enterprises. Specifically, in Fullilove v. Klutznick (1980), 448 U.S. 448, 100 S.Ct. 2758, 65 L.Ed.2d 902, the court considered a facial challenge to the constitutionality of the MBE provision of the Public Works Employment Act of 1977. The MBE provision required that absent an administrative waiver, at least ten percent of federal funds granted for local public works projects were to be used by the state or local grantee to procure services or supplies from business enterprises owned and controlled by minority group members. For purposes of the provision, minority group members were defined as citizens of the United States who were “Negroes, Spanish-speaking, Orientals, Indians, Eskimos, and Aleuts.” Section 6705(f)(2), Title 42, U.S.Code. The petitioners in Fullilove challenged the MBE provision in federal district court, claiming, among other things, that the MBE provision violated the Equal Protection Clause of the Fourteenth Amendment and the equal protection component of the Due Process Clause of the Fifth Amendment. The federal district court and the United States Second Circuit Court of Appeals upheld the MBE provision as constitutional in all respects.

In Fullilove, the vote of the United States Supreme Court was once again extremely fractured, and Fullilove, like Bakke, produced no majority opinion for the court. The lead opinion in Fullilove was authored by Chief Justice Burger and was joined by Justices White and Powell. That opinion explored, in detail, the legislative history of the federal MBE provision. The opinion noted that Congress had apparently believed that the provision requiring a ten-percent set-aside was necessary to ensure minority business participation in projects funded through the congressional spending program. Id., 448 U.S. at 462, 100 S.Ct. at 2766, 65 L.Ed.2d at 914. The opinion observed that absent such a requirement, “it was thought that repetition of the prior experience [of an earlier congressional spending package] could be expected, with participation by minority business accounting for an inordinately small percentage of government contracting.” Id. at 462-463, 100 S.Ct. at 2766-2767, 65 L.Ed.2d at 914. Additionally, “[t]he causes of this disparity were perceived as involving the longstanding existence and maintenance of barriers impairing access by minority enterprises to public contracting opportunities, or sometimes as involving more direct discrimination, but not as relating to lack [as one Senator put it] ‘of capable and qualified minority enterprises who are ready and willing to work.’ In the words of its sponsor, the MBE provision was ‘designed to begin to redress this grievance that has been extant for so long.’ ” (Footnotes omitted.) Id. at 463, 100 S.Ct. at 2767, 65 L.Ed.2d at 914.

The lead opinion in Fullilove also reviewed the guidelines and policies that had been developed for administering the federal MBE program. Administrative regulations specified that where contractors were to be selected by state or local grantees through competitive bidding, bids for the prime contract were to be considered responsive only if at least ten percent of the contract funds were to be expended for MBEs. Administrative guidelines had also been developed to ensure that waivers of the ten-percent set-aside requirement were to be granted on a case-by-case basis and upon a determination that, despite affirmative efforts, the required level of MBE participation could not be achieved. Id., 448 U.S. at 469-470 and 481-482, 100 S.Ct. at 2770 and 2776, 65 L.Ed.2d at 918-919 and 926. Administrative waivers were available to avoid subcontracting with MBEs at an unreasonable price, i.e., prices exceeding competitive levels that could not be attributed to an MBE’s attempt to cover costs inflated by the present effects of disadvantage or discrimination. Id. at 470-471, 100 S.Ct. at 2771, 65 L.Ed.2d at 919. In this regard, the lead opinion in Fullilove noted that the administrative policy was consistent with congressional intent, since the federal MBE program was meant to benefit MBEs whose competitive position had been impaired by the effects of disadvantage and discrimination. Id. at 471, 100 S.Ct. at 2771, 65 L.Ed.2d at 919.

Additionally, in Fullilove, the administrative program ensured participation by only bona fide MBEs by specifying, among other things, that minority group ownership interests were to be “ ‘real and continuing and not created solely to meet 10% MBE requirements.’ ” Id. at 492, 100 S.Ct. at 2782, 65 L.Ed.2d at 933, quoting Economic Development Administration guidelines. The program also contained a procedure governing complaints of “unjust participation” and, thus, established a mechanism to prevent participation in the MBE program by enterprises whose access to public contracting opportunities had not been impaired by the effects of prior discrimination. Id. at 482, 100 S.Ct. at 2776, 65 L.Ed.2d at 926. Further, the administrative program clarified the definition of minority group members by specifically defining, e.g., “Oriental” as “[a]n individual of a culture, origin or parentage traceable to the areas south of the Soviet Union, East of Iran, * * * and out to the Pacific including but not limited to Indonesia, Indochina, Malaysia, Hawaii and the Philippines.” Id. at 495, 100 S.Ct. at 2783, 65 L.Ed.2d at 935.

On the basis of the regulations and guidelines governing the administration of the federal MBE program, the lead opinion in Fullilove found that Congress had enacted the program as a “strictly remedial measure.” Id. at 481, 100 S.Ct. at 2776, 65 L.Ed.2d at 926. The opinion states, “The clear objective of the MBE provision is disclosed-by our necessarily extended review of its legislative and administrative background. The program was designed to ensure that, to the extent federal funds were granted under the Public Works Employment Act of 1977, grantees who elect to participate would not employ procurement practices that Congress had decided might result in perpetuation of the effects of prior discrimination which had impaired or foreclosed access by minority businesses to public contracting opportunities. The MBE program does not mandate the allocation of federal funds according to inflexible percentages solely based on race or ethnicity.” Id. at 473, 100 S.Ct. at 2772, 65 L.Ed.2d at 921.

The lead opinion in Fullilove went on to address whether the objectives of the federal MBE program were within the scope of the congressional spending power and concluded that insofar as the MBE program pertained to the actions of state and local grantees, Congress’s objectives could have been achieved by use of its power under Section 5 of the Fourteenth Amendment “to enforce, by appropriate legislation,” the equal protection guarantees of that Amendment. Id., 448 U.S. at 476, 100 S.Ct. at 2773-2774, 65 L.Ed.2d at 923. In this regard, the opinion states:

“With respect to the MBE provision, Congress had abundant evidence from which it could conclude that minority businesses have been denied effective participation in public contracting opportunities by procurement practices that perpetuated the effects of prior discrimination. Congress, of course, may legislate without compiling the kind of ‘record’ appropriate with respect to judicial or administrative proceedings. Congress had before it, among other data, evidence of a long history of marked disparity in the percentage of public contracts awarded to minority business enterprises. This disparity was. considered to result not from any lack of capable and qualified minority businesses, but from the existence and maintenance of barriers to competitive access which had their roots in racial and ethnic discrimination, and which continue today, even absent any intentional discrimination or other unlawful conduct. Although much of this history related to the experience of minority businesses in the area of federal procurement, there was direct evidence before the Congress that this pattern of disadvantage and discrimination existed with respect to state and local construction contracting as well. In relation to the MBE provision, Congress acted within its competence to determine that the problem was national in scope.

“Although the Act recites no preambulary ‘findings’ on the subject, we are satisfied that Congress had abundant historical basis from which it could conclude that traditional procurement practices, when applied to minority businesses, could perpetuate the effects of prior discrimination. Accordingly, Congress reasonably determined that the prospective elimination of these barriers to minority firm access to public contracting opportunities generated by the 1977 Act was appropriate to ensure that those businesses were not denied equal opportunity to participate in federal grants to state and local governments, which is one aspect of the equal protection of the laws. Insofar as the MBE program pertains to the actions of state and local grantees, Congress could have achieved its objectives by use of its power under §5 of the Fourteenth Amendment. We conclude that in this respect the objectives of the MBE provision are within the scope of the Spending Power.” Id., 448 U.S. at 477-478, 100 S.Ct. at 2774-2775, 65 L.Ed.2d at 924.

The lead opinion in Fullilove then turned to the question whether the means that had been chosen by Congress to accomplish its objectives were constitutionally permissible. Id. at 480, 100 S.Ct. at 2775, 65 L.Ed.2d at 925. On this question, the opinion noted that “Congress may employ racial or ethnic classifications in exercising its Spending or other legislative powers only if those classifications do not violate the equal protection component of the Due Process Clause of the Fifth Amendment.” Id. at 480, 100 S.Ct. at 2775, 65 L.Ed.2d at 925. It also pointed out “the need for careful judicial evaluation to assure that any congressional program that employs racial or ethnic criteria to accomplish the objective of remedying the present effects of past discrimination is narrowly tailored to the achievement of that goal.” Id. at 480, 100 S.Ct. at 2775-2776, 65 L.Ed.2d at 925.

En route to upholding the MBE provision as constitutional, the lead opinion in Fullilove addressed and rejected the concept that, in the remedial context, Congress must act in a colorblind fashion. Id., 448 U.S. at 482, 100 S.Ct. at 2776, 65 L.Ed.2d at 926-927. It also rejected arguments that the MBE program impermissibly deprived nonminority businesses of access to a portion of governmental contracting opportunities, that the MBE provision was underinclusive, and that the provision was overinclusive. Id. at 484-489, 100 S.Ct. at 2777-2780, 65 L.Ed.2d at 928-931.

With respect to the argument that the program would impermissibly deprive nonminority businesses of access to some percentage of the public contracting opportunities, the lead opinion in Fullilove determined that it was “not a constitutional defect in this program that it may disappoint the expectations of nonminority firms,” since “[w]hen effectuating a limited and properly tailored remedy to cure the effects of prior discrimination, such a ‘sharing of the burden’ by innocent parties is not impermissible.” Id., 448 U.S. at 484, 100 S.Ct. at 2778, 65 L.Ed.2d at 928. Additionally, the lead opinion observed that “[t]he actual ‘burden’ shouldered by nonminority firms is relatively light in this connection when we consider the scope of this public works program as compared with overall construction contracting opportunities.” Id. Further, the opinion noted that the burden placed on nonminority firms was merely an “incidental consequence” of the MBE program — not part of the program’s objective. Id. Moreover, the lead opinion states, “although we may assume that the complaining parties are innocent of any discriminatory conduct, it was within congressional power to act on the assumption that in the past some nonminority businesses may have reaped competitive benefit over the years from the virtual exclusion of minority firms from these contracting opportunities.” Id. at 484-485, 100 S.Ct. at 2778, 65 L.Ed.2d at 928.

With regard to the argument that the MBE provision was underinclusive (i.e., that it benefited only specified minority groups and not other businesses that may have suffered from disadvantage or discrimination), the lead opinion in Fullilove concluded that any expansion of the program was “not a function for the courts.” Id., 448 U.S. at 485, 100 S.Ct. at 2778, 65 L.Ed.2d at 929. The opinion noted, “The Congress has not sought to give select minority groups a preferred standing in the construction industry, but has embarked on a remedial program to place them on a more equitable footing with respect to public contracting opportunities. There has been no showing in this case that Congress has inadvertently effected an invidious discrimination by excluding from coverage an identifiable minority group that has been the victim of a degree of disadvantage and discrimination equal to or greater than that suffered by the groups encompassed by the MBE program. It is not inconceivable that on very special facts a case might be made to challenge the congressional decision to limit MBE eligibility to the particular minority groups identified in the Act. * * * But on this record we find no basis to hold that Congress is without authority to undertake the kind of limited remedial effort represented by the MBE program. Congress, not the courts, has the heavy burden of dealing with a host of intractable economic and social problems.” Id. at 485-486, 100 S.Ct. at 2778-2779, 65 L.Ed.2d at 929.

As to the claim that the MBE provision was overinclusive, the lead opinion in Fullilove states:

“It is also contended that the MBE program is overinclusive — that it bestows a benefit on businesses identified by racial or ethnic criteria which cannot be justified on the basis of competitive criteria or as a remedy for the present effects of identified prior discrimination. It is conceivable that a particular application of the program may have this effect; however, the peculiarities of specific applications are not before us in this case. We are not presented here with a challenge involving a specific award of a construction contract or the denial of a waiver request; such questions of specific application must await future cases.

“This does not mean that the claim of overinclusiveness is entitled to no consideration in the present case. The history of governmental tolerance of practices using racial or ethnic criteria for the purpose or with the effect of imposing an invidious discrimination must alert us to the deleterious effects of even benign racial or ethnic classifications when they stray from narrow remedial justifications. Even in the context of a facial challenge such as is presented in this case, the MBE provision cannot pass muster unless, with due account for its administrative program, it provides a reasonable assurance that application of racial or ethnic criteria will be limited to accomplishing the remedial objectives of Congress and that misapplications of the program will be promptly and adequately remedied administratively.

“It is significant that the administrative scheme provides for waiver and exemption. Two fundamental congressional assumptions underlie the MBE program: (1) that the present effects of past discrimination have impaired the competitive position of businesses owned and controlled by members of minority groups; and (2) that affirmative efforts to eliminate barriers to minority-firm access, and to evaluate bids with adjustment for the present effects of past discrimination, would assure that at least 10% of the federal funds granted under the Public Works Employment Act of 1977 would be accounted for by contracts with available, qualified, bona fide minority business enterprises. Each of these assumptions may be rebutted in the administrative process.

“The administrative program contains measures to effectuate the congressional objective of assuring legitimate participation by disadvantaged MBE’s. Administrative definition has tightened some less definite aspects of the statutory identification of the minority groups encompassed by the program. There is administrative scrutiny to identify and eliminate from participation in the program MBE’s who are not ‘bona fide’ within the regulations and guidelines; for example, spurious minority-front entities can be exposed. A significant aspect of this surveillance is the complaint procedure available for reporting ‘unjust participation by an enterprise or individuals in the MBE program.’ * * * And even as to specific contract awards, waiver is available to avoid dealing with an MBE who is attempting to exploit the remedial aspects of the program by charging an unreasonable price, ie., a price not attributable to the present effects of past discrimination. * * * We must assume that Congress intended close scrutiny of false claims and prompt action on them.

“Grantees are given the opportunity to demonstrate that their best efforts will not succeed or have not succeeded in achieving the statutory 10% target for minority firm participation within the limitations of the program’s remedial objectives. In these circumstances a waiver or partial waiver is available once compliance has been demonstrated. A waiver may be sought and granted at any time during the contracting process, or even prior to letting contracts if the facts warrant.

«* * *

“That the use of racial and ethnic criteria is premised on assumptions rebuttable in the administrative process gives reasonable assurance "that application of the MBE program will be limited to accomplishing the remedial objectives contemplated by Congress and that misapplications of the racial and ethnic criteria can be remedied. In dealing with this facial challenge to the statute, doubts must be resolved in support of the congressional judgment that this limited program is a necessary step to effectuate the constitutional mandate for equality of economic opportunity. The MBE provision may be viewed as a pilot project, appropriately limited in extent and duration, and subject to reassessment and reevaluation by the Congress prior to any extension or reenactment. Miscarriages of administration could have only a transitory economic impact on businesses not encompassed by the program, and would not be irremediable.” (Footnotes omitted.) Id., 448 U.S. at 486-489, 100 S.Ct. at 2779-2780, 65 L.Ed.2d at 929-931.

The lead opinion in Fullilove determined that “[f]or its part, the Congress must proceed only with programs narrowly tailored to achieve its objectives, subject to continuing evaluation and reassessment; administration of the programs must be vigilant and flexible; and, when such a program comes under judicial review, courts must be satisfied that the legislative objectives and projected administration give reasonable assurance that the program will function within constitutional limitations.” Id. at 490, 100 S.Ct. at 2781, 65 L.Ed.2d at 932. Additionally, the opinion notes, “Any preference based on racial or ethnic criteria must necessarily receive a most searching examination to make sure that it does not conflict with constitutional guarantees.” Id. at 491, 100 S.Ct. at 2781, 65 L.Ed.2d at 933. The lead opinion did not, however, “adopt, either expressly or implicitly, the formulas of analysis articulated in such cases as [Bakke, 438 U.S. 265, 98 S.Ct. 2733, 57 L.Ed.2d 750].” Fullilove at 492, 100 S.Ct. at 2781, 65 L.Ed.2d at 933. Nevertheless, the lead opinion specifically states that “our analysis demonstrates that the MBE provision would survive judicial review under either ‘test’ articulated in the several Bakke opinions.” (Emphasis added.) Fullilove at 492, 100 S.Ct. at 2781, 65 L.Ed.2d at 933.

As previously noted, Fullilove did not produce a majority opinion for the court. In addition to Chief Justice Burger’s lead opinion (joined by Justices White and Powell), Justice Powell wrote a separate concurring opinion, in which he expressed the view that the lead opinion was substantially in accordance with his own views that strict scrutiny applied to the racial classification of the federal MBE provision and that, for all practical purposes, the lead opinion had applied that standard correctly. Id., 448 U.S. at 495-496, 100 S.Ct. at 2783-2784, 65 L.Ed.2d at 935. Justice Powell stated that the applicable standard is whether a racial classification “is a necessary means of advancing a compelling governmental interest.” Id. at 496, 100 S.Ct. at 2783-2784, 65 L.Ed.2d at 935. He concluded, therefore, that the racial classification at issue was justified as a narrowly tailored remedy serving the compelling governmental interest in eradicating and repairing the continuing effects of past unlaioful discrimination identified by Congress — even though, incidentally, there was never any explicit or formal congressional findings of illegal discrimination in the form of statutory or constitutional violations. See, generally, id. at 496-507, 100 S.Ct. at 2784-2789, 65 L.Ed.2d at 936-943.

Additionally, in Fullilove, Justice Marshall, joined by Justices Brennan and Blackmun, concurred in judgment and wrote separately to express the view that the analysis of their joint separate opinion in Bakke, joined also by Justice White, 438 U.S. at 324-379, 98 S.Ct. at 2765-2794, 57 L.Ed.2d at 792-827, controlled the resolution of the question whether the federal MBE provision was constitutional. 448 U.S. at 517-522, 100 S.Ct. at 2794-2797, 65 L.Ed.2d at 949-953. Specifically, Justice Marshall argued that “the proper inquiry is whether racial classifications designed to further remedial purposes serve important governmental objectives and are substantially related to achievement of those objectives,” and in applying that standard, he concluded that the federal MBE provision was “plainly constitutional.” Id. at 519, 100 S.Ct. at 2796, 65 L.Ed.2d at 951.

Justice Stewart, joined by Justice Rehnquist, dissented. Id. at 522-532, 100 S.Ct. at 2797-2803, 65 L.Ed.2d at 953-959. He argued that the equal protection standard is the same for state and federal governments, that the single standard prohibits invidious discrimination, that all discrimination is invidious by definition, and that the federal MBE provision was unconstitutional because it granted preferences to certain groups on the basis of race. Id., 448 U.S. at 523 and 526-532, 100 S.Ct. at 2798 and 2799-2803, 65 L.Ed.2d at 953 and 955-959.

Justice Stevens also dissented in Fullilove, urging that “[r]acial classifications are simply too pernicious to permit any but the most exact connection between justification and classification,” and that the MBE provision was a “slapdash” statute providing classwide relief that could not be characterized as a narrowly tailored remedy. Id. at 537, 539 and 541, 100 S.Ct. at 2805, 2806 and 2807, 65 L.Ed.2d at 962, 963 and 965.

Several years after Fullilove, the court, in 1986, decided Wygant v. Jackson Bd. of Edn. (1986), 476 U.S. 267, 106 S.Ct. 1842, 90 L.Ed.2d 260. At issue in Wygant was a layoff provision in a collective bargaining agreement between a local school board and a teachers’ union. The provision required that if layoffs became necessary, teachers with the most seniority would be retained, except that at no time would there be a greater percentage of minority personnel laid off than the current percentage of minority personnel at the time of the layoff. Minorities were defined in the agreement as employees who were Black, American Indian, Oriental, or of Spanish descent. In 1974, during a round of layoffs, the board did not comply with the provision. However, after the layoff provision was upheld in litigation arising from the board’s noncompliance with its terms, the board began adhering to the provision. As a result, during the 1976-1977 and 1981-1982 school years, nonminority teachers were laid off, while minority teachers with less seniority were retained.

In Wygant, the displaced nonminority teachers sued in federal district court, alleging violations of, among other things, the Equal Protection Clause of the Fourteenth Amendment. The district court upheld the constitutionality of the school board’s race-based layoffs. The district court found that the racial preferences granted by the school board need not have been grounded on a finding of prior discrimination, and that the racial preferences were permissible under the Equal Protection Clause as an attempt to remedy societal discrimination by providing role models for minority schoolchildren. On appeal, the United States Sixth Circuit Court of Appeals affirmed the judgment of the. district court. Thereafter, the United States Supreme Court granted certiorari to consider the constitutionality of race-based layoffs by public employers and reversed the judgment of the court of appeals.

In Wygant, the United States Supreme Court was once again unable to produce a majority opinion. Rather, Justice Powell wrote a plurality opinion, which was joined in full by Chief Justice Burger and by Justice Rehnquist, and in all but one part by Justice O’Connor. The plurality phrased the issue in Wygant as “whether a school board, consistent with the Equal Protection Clause, may extend preferential protection against layoffs to some of its employees because of their race or national origin.” Id., 476 U.S. at 269-270, 106 S.Ct. at 1844-1845, 90 L.Ed.2d at 266.

In Wygant, Justice Powell’s plurality opinion observed that “the level of scrutiny does not change merely because the challenged classification operates against a group that historically has not been subject to governmental discrimination.” Id. at 273, 106 S.Ct. at 1846, 90 L.Ed.2d at 268. Therefore, recognizing that the layoff provision established a classification based on race and that it had operated against whites and in favor of certain minorities,