City of Richmond v. J. A. Croson Company

PETITIONER: City of Richmond
RESPONDENT: J. A. Croson Company
LOCATION: City Council of Richmond

DOCKET NO.: 87-998
DECIDED BY: Rehnquist Court (1988-1990)
LOWER COURT: United States Court of Appeals for the Fourth Circuit

CITATION: 488 US 469 (1989)
ARGUED: Oct 05, 1988
DECIDED: Jan 23, 1989

ADVOCATES:
John A. Payton - Argued the cause for the appellant
Walter H. Ryland - Argued the cause for the appellee

Facts of the case

In 1983, the City Council of Richmond, Virginia adopted regulations that required companies awarded city construction contracts to subcontract 30 percent of their business to minority business enterprises. The J.A. Croson Company, which lost its contract because of the 30 percent set-aside, brought suit against the city.

Question

Did the Richmond law violate the Equal Protection Clause of the Fourteenth Amendment?

Media for City of Richmond v. J. A. Croson Company

Audio Transcription for Oral Argument - October 05, 1988 in City of Richmond v. J. A. Croson Company

William H. Rehnquist:

We'll hear argument next in number 87-998, the city of Richmond v. the J. A. Croson Company.

Mr. Payton, you may proceed whenever you're ready.

John A. Payton:

Mr. Chief Justice, and may it please the Court, the sole issue in this case is the constitutionality of the ordinance enacted by the Appellant, the city of Richmond, to remedy the effects of racial discrimination in its construction industry.

That ordinance, the Minority Business Utilization Plan, provided that with respect to construction contracts with the city, at least 30 percent of the dollar amount of the contract must go to minority business enterprises.

The ordinance was designed to last five years, and contained an appropriate waiver provision.

By enacting this ordinance, Richmond was attempting to address one of the most difficult problems confronting our nation and its cities and States.

Identified racial discrimination is a scourge of our society.

Richmond focused on discrimination in the construction industry, and proceeded to try to remedy that discrimination.

Aware of findings of the Congress regarding discrimination nationwide in the construction industry, and of this Court's decision in Fullilove, upholding Federal legislation remedying that discrimination, Richmond examined its own construction industry.

It learned that from 1978 to 1983, two-thirds of one percent of its construction dollars went to minority businesses... this in a city that was 50 percent Black.

That was not all that Richmond knew--

John Paul Stevens:

Mr. Payton, can I interrupt you there?

Is that a correct statement that only two-thirds of one percent went to minority business enterprises?

What about the subcontractors?

John A. Payton:

--There is no evidence in the record with regard to how subcontracting was divided up, but as the District Court found, there is no reason at all to expect that the subcontracting would have gone another way.

In fact, when Congress made its findings with respect to the construction industry, it found that the construction industry is an industry which is a business system which has precluded measurable minority participation.

And the way that occurred, as the Congress identified it, was by first of all having formidable racial barriers to racial entry and advancement.

The barrier to entry has to do with how you get to be a contractor.

The barrier to advancement has to do with what the Congress found, and what this Court also noted in Fullilove, is the problem of racial discrimination in the relationship between prime construction contractors and their subcontractors.

And they found that this business system operates in the following way: that a prime contractor often does business over and over again with the same group of subcontractors.

And in one of the items that we cite in our brief, Glover, minority business... minority enterprise in construction, that is a study which noted that often in that relationship, prime construction contractors and their subcontractors, often it's impossible to break in by minority contractors, even when they have the low bid.

That's one of the problems that arises.

So, there is nothing in the record that says exactly what the racial breakup of subcontracting is, but the evidence with regard to prime contracting is stark and dramatic, and there is no reason, as the trial court found, to expect it to be any different.

Byron R. White:

But the ordinance purport to remedy that disparity, did it?

John A. Payton:

The ordinance purported to remedy the fact that there were very few minority contractors in the construction industry.

Byron R. White:

It just required subs to get to a--

John A. Payton:

Yes.

The means that Richmond chose to try to remedy the discrimination that it identified was to focus on a remedy that was both modest and narrow.

And The narrow focus of the remedy was to look at subcontracting.

And the reason for that, is that I think that everyone would agree, that it is easier to break into the business as a subcontractor, and break into this, what I would call a closed business system, by doing work with prime contractors.