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| | | | | American Constitutional Law, Volume One
Gregg Ivers, American University
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Case Problems
Chapter Six: Congressional Power to Regulate
When is Private Discrimination of Public Concern?
Formed in 1997, Zeebop! quickly grew into an extraordinarily successful Web retailer of compact discs, DVDs, videotapes, cassette tapes and related products. Zeebop! was based in Megopolis, a moderately large city with a metropolitan population of just over two million people. Once a major industrial center, Megopolis had adapted to the nation's changing economics over the years. It was now considered a premier city for small companies to establish their headquarters, particularly those active in the technology sector, because of the political structure's favorable attitude towards business development. Since 1990, over dozen major corporations had moved their headquarters to Megopolis, including Sprocket Rocket Company, a major aerospace concern, Aromatic Coffee and Tea, one of the nation's fastest growing retail companies, and Whatever Ice Cream, a high-end ice cream manufacturer that sold its products in grocery stores and other retail outlets. Megopolis, like the rest of the state, had no sales tax. Megopolis relied on property taxes and taxes assessed on tourists and business travelers (hotel, rental car and facilities taxes and airport use fees) for most of its revenue. In the late 1980s, several members of the city council proposed a 3% sales tax on all products purchased within city limits. The proposal was soundly defeated.
But Megopolis was steeped in a civic and corporate culture that expected corporations to provide services to the community. Ever since Megopolis began the transformation from an industrial economy to a service and technology-oriented economy, this model had worked quite well. Corporations had provided computers and other assistance to local schools, donated services and materials to build recreational facilities, sponsored literacy programs, provided transportation to the physically disabled, and so on. During recruiting efforts to lure major corporations to establish their headquarters in Megopolis city officials made it clear that philanthropy and corporate citizenship were expected in exchange for the favorable tax and business incentives.
In June 2000, Megopolis city officials met with Zeebop! executives to discuss a long-range corporate citizenship plan. Zeebop! was eager to build a more visible presence in the city's recreational profile and came to the meeting with several ideas on how it could make the most significant contribution. After a review of the city's most pressing social service needs, Zeebop! and Megopolis city officials agreed that Zeebop! would develop a 55 acre parcel of land it owned near one of the city's several lakes. In exchange, Megopolis agreed to place a 50-year moratorium on any municipal claim to the land.
Between July 2000 and January 2001, Zeebop! developed the land to include an amphitheater for outdoor shows and concerts; a large swimming pool open to the public; two miniature golf courses; a petting zoo; three softball fields; numerous picnic areas; and a walking, running and bicycling path. Zeebop! spent $10.5 million to develop the property. In an agreement reached with the city, Zeebop! would be responsible for the expense of maintaining the park and underwriting the costs of all entertainment.
Zeebop! opened the park to the public in April 2001. Zeebop!'s admissions regulations included the following rules:
- All patrons must wear shirts and shoes outside the swimming pool area.
- All children under 12 years old must be accompanied by an adult at least 18 years old.
- No glass bottles or aluminum cans.
- No smoking or tobacco use.
- No alcohol permitted, except on the concourse of the amphitheater.
Zeebop! park also included one restriction:
"In keeping with the family values of the Zeebop! Corporation, gays and lesbians are required to use specifically designated sections of the picnic area, swimming pool, and amphitheater. Gays and lesbians are permitted to use all other facilities in the park."
Upon seeing the restriction on gay and lesbian use of the park, Civil Liberties Forever (CLF) wrote a letter to Zeebop! management claiming that the policy violated the civil rights of gays and lesbians. Zeebop! responded that neither Megopolis nor the state included sexual orientation in their state laws prohibiting discrimination in public accommodations. Zeebop! also pointed out that no federal law, including the Civil Rights Act of 1964, barred discrimination on the basis of sexual orientation in public accommodations. Finally, Zeebop! claimed that the park was privately owned, engaged in no commercial activity since no admission was charged and no concessions were offered, and was thus beyond the scope of any such law based on government power to regulate commerce.
CLF countered that the park acquired a municipal character since Zeebop! and Megopolis had reached an agreement to develop land owned by Zeebop! And while CLF acknowledged that the Civil Rights Act of 1964 did not include protection on the basis of sexual orientation, it argued that a 1982 amendment to the law prohibited discrimination in public accommodations based on sex. By treating some men and women differently than others, the Zeebop! restrictions violated federal law. CLF lawyers drew a direct comparison between the park restrictions and the exclusionary policies found illegal in Heart of Atlanta Motel v. United States (1964) and Katzenbach v. McClung (1964). CLF also argued that Zeebop!'s policies violated the Equal Protection Clause of the Fourteenth Amendment.
Zeebop! lawyers countered by citing the Court's recent decisions in United States v. Lopez (1995) and United States v. Morrison (2000). Zeebop! was a private facility that engaged in no interstate commercial activity. CLF arguments that potential out-of-state patrons, along with national entertainers booked into the amphitheater, brought the park within the orbit of the Commerce Clause, were simply not credible. Finally, Zeebop! argued that the Equal Protection Clause arguments failed because the park policies did not constitute state action.
Questions
- Is Zeebop! Park a private facility or one with a municipal character?
- Does the Civil Rights Act of 1964, as amended by the 1982 amendments, reach the restrictions on gay and lesbian usage of Zeebop! Park?
- Does the CLF have a valid legal claim under the Equal Protection Clause of the Fourteenth Amendment?
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