Complaint for Declaratory and Injunctive Relief

1 SHARON L. BROWNE, No. 119246 E-mail: slb@pacificlegal.org 2 RALPH W. KASARDA, No 205286 E-mail: rwk@pacificlegal.org 3 ANTONIO J. SENAGORE, No. 258853 E-mail: as@pacificlegal.org 4 Pacific Legal Foundation 3900 Lennane Drive, Suite 200 5 Sacramento, California 95834 Telephone: (916) 419-7111 6 Facsimile: (916) 419-7747 7 Attorneys for Plaintiff Associated General Contractors 8 of America, San Diego Chapter, Inc. 9 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA PACIFIC LEGAL FOUNDATION 11 12 13 ASSOCIATED GENERAL CONTRACTORS OF AMERICA, SAN DIEGO CHAPTER, INC., 14 a nonprofit California corporation, 15 16 v. Plaintiff, 17 CALIFORNIA DEPARTMENT OF TRANSPORTATION; WILL KEMPTON, 18 individually, and in his official capacity as Director of the California Department of 19 Transportation; and OLIVIA FONSECA, individually, and in her official capacity as 20 Deputy Director of the California Department of Transportation, 21 Defendants. 22 23 24 25 26 27 28 Complaint for Declaratory & Injunctive Relief No. __________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) No. ____________________ COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF 1 2 1. INTRODUCTION Since 2006, the California Department of Transportation (Caltrans) has been 3 operating a race neutral Disadvantaged Business Enterprise (DBE) program for its federally funded 4 highway construction program. On or about March, 2009, Caltrans began injecting race, sex, and 5 ethnicity into public contracting decisions by implementing the Disadvantaged Business Enterprise 6 (DBE) Goal and Methodology for Federal Fiscal Year 2009 (2009 DBE Program). The 2009 DBE 7 Program requires that a certain percentage of contracts on federally funded transportation projects 8 be awarded on the basis of race- and sex-based preferences. Specifically, prime contractors must 9 either hire an African American, Native American, Asian Pacific, or woman-owned firm, or 10 demonstrate “good faith efforts” to obtain the required DBE participation. 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 Male-owned PACIFIC LEGAL FOUNDATION 11 nonminority, Hispanic American, and Subcontinent Asian American businesses are not included 12 in the race-conscious portion of the program. Plaintiff Associated General Contractors of America, 13 San Diego Chapter, Inc. (AGC San Diego), brings this challenge seeking declaratory and injunctive 14 relief against the California Department of Transportation, Will Kempton, Director of the 15 California Department of Transportation, and Olivia Fonseca, Deputy Director of the California 16 Department of Transportation, on the grounds that the DBE program is unlawful and unenforceable 17 because it violates the Fourteenth Amendment to the United States Constitution, the plain language 18 of 42 U.S.C. §§ 1981, 1983, Title VI of the Civil Rights Act of 1964, as amended, 42 U.S.C. 19 § 2000d, and Article I, section 31, of the California Constitution. 20 21 2. JURISDICTION AND VENUE This action arises under the Fourteenth Amendment to the United States 22 Constitution; 42 U.S.C. §§ 1981, 1983, 2000d; and Article I, section 31, of the California 23 Constitution. The Court has jurisdiction of the federal law claims under 28 U.S.C. §§ 1331 (federal 24 question), and 1343(a) (redress deprivation of civil rights), and jurisdiction of the state law claim 25 under 28 U.S.C. § 1367. Declaratory relief is authorized by the Declaratory Judgment Act, 26 28 U.S.C. §§ 2201-2202. 27 /// 28 /// Complaint for Declaratory & Injunctive Relief No. __________ -1- 1 3. Venue is proper in this Court pursuant to 28 U.S.C. § 1391(e) because a defendant 2 in the action resides in this district, and because a substantial part of the events or omissions giving 3 rise to Plaintiff’s claims occurred or will occur in this district. 4 5 4. PARTIES Plaintiff Associated General Contractors of America, San Diego Chapter, Inc. (AGC 6 San Diego), is the San Diego Chapter of Associated General Contractors of California, Inc. AGC 7 San Diego is a nonprofit California corporation, with headquarters in San Diego, California. Since 8 its organization in 1927, AGC San Diego has been dedicated to improving the construction industry 9 by educating the industry to employ the finest skills, the latest technology, and advocating building 10 the best quality projects for owners, both public and private. One of AGC San Diego’s principal 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 aims and objectives is the establishment and maintenance of fair and nondiscriminatory 12 competitive bidding practices for public construction projects, including those funded by federal 13 monies. AGC San Diego’s members include construction firms that have submitted bids both as 14 prime or general contractors and as subcontractors on projects receiving federal funds through 15 Caltrans. AGC San Diego members have submitted bids in the past, and they are ready, willing, 16 and able and are continuing to submit bids for future contracts that are, or will be, subject to 17 Caltrans’ 2009 DBE Program. But, many of AGC San Diego’s members are not members of the 18 race and sex classes granted preferences by Caltrans’ 2009 DBE Program and they are not 19 permitted by these programs to have their bids for contracts considered on the same equal basis as 20 those members of race and sex classes preferred by this program. In order for these members of 21 AGC San Diego to comply with the requirements of Caltrans’ 2009 DBE Program, which grants 22 preferences on the basis of race or sex, their project expenses are increased by the cost of 23 performing good faith efforts to businesses owned by minority and women and they are placed in 24 a competitive disadvantage. Further, Caltrans’ 2009 DBE Program requires them to use 25 minority-owned and women-owned subcontractors rather than their own employees or other 26 subcontractors of their own choosing, and forces them to discriminate against businesses not owned 27 by women or minorities who are not of the preferred racial groups who may want to participate as 28 subcontractors. These members of AGC San Diego are placed at risk of liability for such Complaint for Declaratory & Injunctive Relief No. __________ -2- 1 discrimination. Further, Caltrans’ 2009 DBE Program remains in full force and effect and will 2 continue to be enforced with respect to all bids to which it applies. AGC San Diego along with 3 Associated General Contractors of California submitted comments to Caltrans on September 24, 4 2007, stating that the race- and sex-conscious measures Caltrans was contemplating were not 5 justified by the Availability and Disparity Study of June 29, 2007, and if adopted, would violate 6 the federal and state Constitutions. AGC San Diego has a legitimate and substantial interest in the 7 public right at issue in this proceeding and in having the Defendants comply with both the federal 8 and state Constitutions. Members of AGC San Diego are within the class of persons directly and 9 beneficially interested in the Defendants’ faithful performance of their legal duties under the federal 10 and state Constitutions. The interests of AGC San Diego and its members have been, are, and will 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 be directly, adversely, and irreparably affected by Defendants’ race- or sex-conscious contracting 12 provisions contained in Caltrans’ 2009 DBE Program. Accordingly, AGC San Diego brings this 13 action for and on behalf of itself and its members in order to vindicate their individual rights. 14 5. Defendant California Department of Transportation (Caltrans) is a department 15 within the California Business, Transportation and Housing Agency (Cal. Gov’t Code § 13975) and 16 is responsible for planning, designing, building, operating, and maintaining California’s state road 17 system. Generally, Caltrans has the duties prescribed by California Streets and Highways Code 18 sections 90-97, among others. Caltrans receives and administers federal funds for highway 19 construction under the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy 20 for Users (SAFETEA-LU), 23 U.S.C. § 101, et seq., and its implementing regulations at Title 49 21 Code of Federal Regulations Part 26. Caltrans has a duty to comply with the Constitutions of the 22 United States and California by not engaging in discrimination or granting preferential treatment 23 to individuals or groups on the basis of race, sex, color, ethnicity, or national origin in the operation 24 of public contracting pursuant to the Fourteenth Amendment to the United States Constitution; 25 42 U.S.C. §§ 1981, 1983, 2000d; and Article I, section 31, of the California Constitution. 26 6. Defendant Will Kempton is the Director of Caltrans. Mr. Kempton is an officer of 27 the State of California with the duty to abide by the United States and California Constitutions. 28 As such, Mr. Kempton has a duty to enforce the Constitutions of the United States and California Complaint for Declaratory & Injunctive Relief No. __________ -3- 1 by not engaging in discrimination or granting preferential treatment on the basis of race, sex, color, 2 ethnicity, or national origin in the operation of public contracting pursuant to the Fourteenth 3 Amendment to the United States Constitution; 42 U.S.C. §§ 1981, 1983, 2000d; and Article I, 4 section 31, of the California Constitution. Mr. Kempton is being sued individually, and in his 5 official capacity as the Director of Caltrans. 6 7. Defendant Olivia Fonseca is a Deputy Director of Civil Rights for Caltrans. 7 Ms. Fonseca is responsible for implementing Caltrans’ Disadvantaged Business Enterprise 8 Program. As such, Ms. Fonseca has a duty to enforce the Constitutions of the United States and 9 California by not engaging in discrimination or granting preferential treatment on the basis of race, 10 sex, color, ethnicity, or national origin in the operation of public contracting pursuant to the 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 Fourteenth Amendment to the United States Constitution; 42 U.S.C. §§ 1981, 1983, 2000d; and 12 Article I, section 31, of the California Constitution. Ms. Fonseca is being sued individually and 13 in her official capacity as a Deputy Director of Caltrans. 14 15 16 17 8. On August 10, 2005, President George W. Bush signed into law the SAFETEA-LU. ALLEGATIONS THE SAFE, ACCOUNTABLE, FLEXIBLE, EFFICIENT TRANSPORTATION EQUITY ACT: A LEGACY FOR USERS 18 23 U.S.C. § 101, et seq. SAFETEA-LU authorizes the federal surface transportation spending 19 programs for highways, highway safety, and transit for the five-year period 2005-2009. 20 SAFETEA-LU authorizes the United States Department of Transportation (USDOT) and the 21 Federal Highway Administration to distribute funds to states each year for the financing of state 22 construction projects. 23 9. Plaintiff is informed and believes, and on that basis alleges, that Congress will pass 24 a similar replacement bill during its 2009 session. 25 10. Under SAFETEA-LU, the USDOT administers and enforces a minority preference 26 program. Pub. L. 109-59, title 1, § 1101(b) of SAFETEA-LU is entitled “Disadvantaged Business 27 Enterprises.” That section does not establish a nationwide disadvantaged business enterprise 28 program centrally administered by the USDOT. Rather, SAFETEA-LU delegates to each state that Complaint for Declaratory & Injunctive Relief No. __________ -4- 1 accepts federal transportation funds the responsibility for implementing a DBE program that 2 comports with SAFETEA-LU. 3 11. Section 1101(b)(1)(B) of SAFETEA-LU provides that the term “[s]ocially and 4 economically disadvantaged individuals” shall have the meaning as that term has under 5 Section 8(d) of the Small Business Act, 15 U.S.C. § 637(d), and relevant subcontracting regulations 6 issued pursuant to SAFETEA-LU. Section 8(d) of the Small Business Act, 15 U.S.C. § 637(d) 7 creates a presumption that socially and economically disadvantaged individuals include “Black 8 Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, and other minorities, 9 or any other individual found to be disadvantaged by the [Small Business Administration] pursuant 10 to section 8(a) of the Small Business Act.” Under Section 1101(b)(1)(B) of SAFETEA-LU, 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 women also are “presumed to be socially and economically disadvantaged individuals.” 12 12. Section 1101(b)(2) of SAFETEA-LU provides: “Except to the extent that the 13 Secretary determines otherwise, not less than 10 percent of the amounts made available for any 14 program . . . shall be expended through small business concerns owned and controlled by socially 15 and economically disadvantaged individuals.” 16 13. Thus, under Section 1101(b)(2), SAFETEA-LU presumes that not less than 10% 17 of the amounts made available for any federally funded highway transportation project shall be 18 expended by small businesses owned by women, Black Americans, Hispanic Americans, Native 19 Americans, Asian Pacific Americans, and other minorities, or any other individual found to be 20 disadvantaged by the Small Business Administration. 21 14. Section 1101(b)(5) of SAFETEA-LU provides that if an entity receiving federal 22 funds under SAFETEA-LU cannot comply with Section 1101(b)(1), because a federal court has 23 found that section to be unconstitutional, the entity is still eligible to receive federal funds. 24 25 15. TITLE 49 CODE OF FEDERAL REGULATIONS PART 26 The implementing regulations for the disadvantaged business enterprise preference 26 program are found at Title 49 Code of Federal Regulations (49 C.F.R.) Part 26, §§ 26.1-26.109, 27 as amended, June 16, 2003. See 68 Fed. Reg. 35,542 (June 16, 2003). These regulations do not 28 purport to parallel constitutional requirements. Complaint for Declaratory & Injunctive Relief No. __________ -5- 1 16. A DBE is defined as a small business owned and controlled by one or more 49 C.F.R. § 26.5. Under 2 individuals who are socially and economically disadvantaged. 3 Section 26.61, as amended in the Federal Register on June 16, 2003, states receiving federal funds 4 for highway construction projects “must rebuttably presume that members of the designated groups 5 identified in § 26.67(a) are socially and economically disadvantaged.” 68 Fed. Reg. 35,542, 6 35,554. The SAFETEA-LU regulations presume that Black Americans, Hispanic Americans, 7 Native Americans, Asian Pacific Americans, Subcontinent Asian Americans, and women are 8 socially and economically disadvantaged. 49 C.F.R. § 26.67(a). 9 17. The SAFETEA-LU presumption of social and economic disadvantage is rebutted 10 where the individual has a personal net worth of more than $750,000 (excluding the value of home 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 and business) or a preponderance of the evidence demonstrates that the individual is not in fact 12 socially and economically disadvantaged. 49 C.F.R. § 26.67(b). Firms owned and controlled by 13 someone who is not presumed to be disadvantaged (i.e., a white male) can qualify for DBE status 14 if the individual can demonstrate that he is in fact socially and economically disadvantaged. 49 15 C.F.R. § 26.67(d). 16 18. The SAFETEA-LU regulations delineate a two-step process that a state must follow 17 to set a DBE utilization goal that reflects its “determination of the level of DBE participation [that] 18 would [be] expect[ed] absent the effects of discrimination.” 49 C.F.R. § 26.45(b). In establishing 19 this goal, a state must first calculate the relative availability of DBEs in its local transportation 20 contracting industry. 49 C.F.R. § 26.45(c). One acceptable means of making this determination 21 is by dividing the number of ready, willing, and able DBEs in a state by the total number of ready, 22 willing, and able firms. 49 C.F.R. § 26.45(c)(1). 23 19. Under step two, a state must examine all available evidence in its jurisdiction to 24 determine if the base figure should be adjusted upward or downward. 49 C.F.R. § 26.45(d). 25 According to 49 C.F.R. § 26.45(d)(1), the many types of evidence to be considered when adjusting 26 the base figure include evidence from disparity studies, and the current capacity of DBEs to 27 perform work (as measured by the volume of work DBEs have performed in recent years). A state 28 may also consider statistical disparities in the bonding and financing industries relative to DBEs, Complaint for Declaratory & Injunctive Relief No. __________ -6- 1 as well as the present effects of past discrimination. 49 C.F.R. § 26.45(d)(2)-(3). The final, 2 adjusted figure represents the proportion of federal transportation funding that a state must allocate 3 to DBEs during the forthcoming fiscal year. 49 C.F.R. § 26.45(e)(1). A state must submit its DBE 4 program to the USDOT for review by August 1 of each year. 49 C.F.R. § 26.45(f)(1). 5 20. The SAFETEA-LU regulations expressly prohibit states from apportioning their 6 DBE utilization goal among different minority groups (e.g., allocating 5% to Black Americans, 7 3% to Hispanic Americans, 0% to Asian Americans, etc.); rather, an undifferentiated goal that 8 encompasses all minority groups is required. 49 C.F.R. § 26.45(h). A state must meet the 9 maximum feasible portion of this goal through race-neutral means, including informational and 10 instructional programs targeted toward all small businesses. 49 C.F.R. § 26.51(a)-(b). Under the 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 SAFETEA-LU regulations, a state must use race-conscious contract goals to achieve any portion 12 of its DBE utilization requirement that cannot be attained through these race-neutral means. 13 49 C.F.R. § 26.51(d). Prime contractors to whom a state awards federally funded transportation 14 contracts must undertake good faith efforts to satisfy a contract’s DBE utilization goal by allocating 15 the designated percentage of funds to DBE firms. 49 C.F.R. § 26.53(a). 16 21. The “good faith” standards that contractors must satisfy are found in Appendix A 17 to Part 26, Title 49, Code of Federal Regulations. Among the types of actions that recipients of 18 federal funds, such as Caltrans, are to consider in determining whether a bidder has made good 19 faith efforts to hire DBEs, are the following: (1) soliciting through all reasonable and available 20 means the interest of all certified DBEs who have the capability to perform the work of the 21 contract; (2) where appropriate, breaking out contract work items into smaller units to facilitate 22 DBE participation, even when the prime contractor might otherwise prefer to perform these work 23 units with its own forces; (3) providing DBEs with adequate information about the plans; (4) not 24 rejecting DBEs as being unqualified without conducting a thorough investigation of their 25 capabilities; (5) making efforts to assist DBEs in obtaining bonding, lines of credit, or insurance; 26 (6) making efforts to assist DBE’s in obtaining necessary equipment, supplies, and materials; 27 and (7) effectively using the services of available minority/women community organizations, 28 /// Complaint for Declaratory & Injunctive Relief No. __________ -7- 1 contractors’ groups, and state or federal minority/women business assistance offices. 49 C.F.R. 2 pt. 26, app. A. 3 22. The standards used to determine whether contractors have used good faith efforts 4 to hire DBE subcontractors state 5 6 7 8 the fact that there may be some additional costs involved in finding and using DBEs is not in itself sufficient reason for a bidder’s failure to meet the contract DBE goal, as long as such costs are reasonable. Also, the ability or desire of a prime contractor to perform the work of a contract with its own organization does not relieve the bidder of the responsibility to make good faith efforts. Prime contractors are not, however, required to accept higher quotes from DBEs if the price difference is excessive or unreasonable. 9 49 C.F.R. pt. 26, app. A, subd. IV.D.2. Thus, in meeting the “good faith” standards, prime 10 contractors are expected to incur additional costs, and are required to accept reasonably higher bids 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 from DBEs, and are allowed to reject only those DBE bids that are considered “excessive” or 12 “unreasonable.” No guidance is given on the difference between a reasonably higher bid and an 13 unreasonably or excessively higher bid. This ambiguity results in bidders discriminating against 14 subcontractors who are not of the preferred race and sex—even if they were more reliable, had the 15 lowest bid, or were best qualified. 16 23. Following the Ninth Circuit Court of Appeals decision of Western States Paving 17 Co., Inc. v. Wash. State Dep’t of Transp., 407 F.3d 983 (9th Cir. 2005), USDOT revised its DBE 18 requirements for those states located in the Ninth Circuit. In Western States, although 19 Washington’s DBE program was approved by USDOT, 407 F.3d at 997, the Ninth Circuit 20 specifically held that Washington’s DBE program was not narrowly tailored to further Congress’ 21 remedial objective, and that “[t]he ‘exact connection’ between means and ends that is a prerequisite 22 to the use of racial classifications is demonstrably absent from Washington’s DBE program.” 23 Western States, 407 F.3d at 1002. In response to the Western States decision, USDOT advised 24 states not having evidence of discrimination or its effect on DBEs to implement only race-neutral 25 goals. See U.S. Dep’t of Transp., Fed. Highway Admin., Office of Civil Rights, Questions and 26 Answers Concerning Response to Western States Paving Company v. Washington State 27 Department of Transportation, available at http://www.fhwa.dot.gov/civilrights/dbe_memo_a5. 28 htm (last visited May 26, 2009). In this regard, Plaintiff is not challenging the federal -8- Complaint for Declaratory & Injunctive Relief No. __________ 1 government’s decision to approve Caltrans’ DBE program. Rather, Plaintiff alleges the federal 2 approval is immaterial and cannot save an unconstitutional program. 3 4 5 24. On November 5, 1996, the people of California amended their Constitution by ARTICLE I, SECTION 31, OF THE CALIFORNIA CONSTITUTION 6 adopting Proposition 209 to add Article I, section 31. The relevant provision of Section 31 7 declares: “The state shall not discriminate against, or grant preferential treatment to, any individual 8 or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public 9 employment, public education, or public contracting.” Cal. Const. art. I, § 31(a). 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 25. Section 31 extends not only to state agencies, but also to all instrumentalities of state PACIFIC LEGAL FOUNDATION 11 government, including the Defendants. Section 3l(f) defines the “state” as: “[T]he state itself, any 12 city, county, city and county, public university system, including the University of California, 13 community college district, school district, special district, or any other political subdivision or 14 governmental instrumentality of or within the state.” Cal. Const. art. I, § 31(f). 15 26. In Hi-Voltage Wire Works, Inc. v. City of San Jose, 24 Cal. 4th 537, 565 (2000), the 16 California Supreme Court held that a municipal contracting scheme that required preferential 17 treatment on the basis of race or sex violated this provision. Because Section 31 treats municipal 18 contracting programs identically as state contracting programs, a statewide program that allows 19 preferential treatment on the basis of race or sex likewise violates Section 31. 20 27. Section 31 is similar to, but not synonymous with, the Equal Protection Clause of 21 the Federal Constitution. Under equal protection principles, state actions that rely upon suspect 22 classifications must be tested under strict scrutiny to determine whether there is a compelling 23 governmental interest. Section 31 allows no compelling state interest exception. Hi-Voltage, 24 24 Cal. 4th at 567. Section 31 “‘prohibits discrimination against or preferential treatment to 25 individuals or groups regardless of whether the governmental action could be justified under strict 26 scrutiny.’” C & C Constr., Inc. v. Sacramento Mun. Util. Dist., 122 Cal. App. 4th 284, 293 (2004) 27 (quoting Connerly v. State Pers. Bd., 92 Cal. App. 4th 16, 42 (2001)). 28 /// Complaint for Declaratory & Injunctive Relief No. __________ -9- 1 28. Section 31 contains an exception to its prohibition against race- and sex-based 2 discrimination and preferences. Subdivision (e) of Section 31 authorizes race-based governmental 3 action, “which must be taken to establish or maintain eligibility for any federal program, where 4 ineligibility would result in a loss of federal funds to the State.” Cal. Const. art. I, § 31(e). In order 5 for a governmental agency to meet this exception, it “must have substantial evidence that it will 6 lose federal funding if it does not use race-based measures and must narrowly tailor those measures 7 to minimize race-based discrimination.” C & C Constr., 122 Cal. App. 4th at 298. 8 29. The adoption, implementation, and enforcement of contracting policies and 9 programs that violate the California Constitution, more particularly described below, infringes on 10 the rights and interests of Plaintiff AGC San Diego. 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 12 13 30. CALTRANS’ DISCRIMINATORY 2009 DBE GOALS AND METHODOLOGY As a condition for receiving federal financial assistance for highway construction 14 under SAFETEA-LU, Caltrans adopted a DBE program. In 2006, Caltrans’ DBE program had a 15 race-conscious component, but after the decision from the Ninth Circuit Court of Appeals in 16 Western States, Caltrans adopted a wholly race-neutral program because it lacked the necessary 17 showing of discrimination against minority-owned contracting firms to support a race-conscious 18 DBE program. Cal. Dep’t of Transp., Civil Rights, Frequently Asked Questions: Disadvantaged 19 Business Enterprise (DBE) Race-Conscious/Race-Neutral Program, available at http://www.dot. 20 ca.gov/hq/bep/documents/DBEFAQ03-09.pdf (last visited May 26, 2009). On May 1, 2006, 21 Defendant Will Kempton sent a letter to the Transportation Construction Community stating that 22 “with regret” Caltrans was suspending all race-conscious requirements and implemented a wholly 23 race-neutral DBE program. The letter encouraged voluntary compliance of the DBE program while 24 an availability study and a disparity study was prepared. Id. A true and correct copy of the May 1, 25 2006, letter is attached hereto as Exhibit 1 and incorporated herein by reference. At no time was 26 Caltrans in jeopardy of losing federal funding. 27 31. In 2007, Caltrans conducted an “Availability and Disparity Study” in an effort to 28 restore its race-conscious DBE program. The disparity study purportedly examined affected DBE Complaint for Declaratory & Injunctive Relief No. __________ - 10 - 1 firms that were ready, willing, and able to perform work. The complete study can be found on the 2 Caltrans’ Web site. BBC Research & Consulting for Cal. Dep’t of Transp., Availability and 3 Disparity Study, Final Report, June 29, 2007, available at http://www.dot.ca.gov/hq/bep/study/ 4 Avail_Disparity_Study_Final_Rpt.pdf (last visited May 26, 2009). 5 32. On August 1, 2007, Caltrans submitted for approval to the USDOT its Overall 6 Annual DBE Goal and Methodology for FFY 2008. The submittal identified an overall DBE goal 7 of 13.5%, to be achieved in equal proportion from race-neutral and race-conscious measures, and 8 further requested a waiver to implement race-conscious goals of limited application to four 9 identified groups: African American, Asian Pacific American, Native American, and Caucasian 10 women owned firms. Hispanic American, Subcontinent Asian American, and male-owned 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 nonminority businesses were not included in the race-conscious portion of the program. On 12 November 14, 2007, Caltrans changed its waiver request to implement a race-conscious goal to 13 African American, Asian-Pacific American, Native American, and women owned firms of all 14 races, excluding businesses owned by nonminority males and male-owned Hispanic American and 15 male-owned Subcontinent Asian American businesses. 16 33. On August 7, 2008, USDOT approved Caltrans’ waiver request to implement 17 race-conscious goals to African American, Asian Pacific American, Native American, and women 18 owned firms. However, Caltrans did not receive approval from USDOT on the goal and 19 methodology. 20 34. In August, 2008, Caltrans submitted to USDOT for approval its Overall Annual 21 DBE Goal and Methodology for FFY 2009 (2009 DBE Program). A true and correct copy of the 22 2009 DBE Program is attached hereto as Exhibit 2, and is incorporated herein as if set forth fully 23 in the body of this Complaint. In continued reliance upon the 2007 Availability and Disparity 24 Study, the 2009 DBE Program maintains the overall DBE goal of 13.5% to be achieved in equal 25 proportion by race-neutral and race-conscious measures. Exhibit 2 at 1, 6. The 2009 DBE 26 Program limits the race-conscious measures to African American, Asian Pacific American, Native 27 American, and women owned contractors and subcontractors. Id. at 7. The race-conscious portion 28 /// Complaint for Declaratory & Injunctive Relief No. __________ - 11 - 1 of the program excludes nonminority-male owned businesses and Hispanic American male-owned 2 businesses and Subcontinent Asian American male-owned businesses. 3 4 5 6 7 8 9 Id. at 8. 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 35. According to the 2009 DBE Program, The race-conscious goal will be achieved by: • • • Setting a DBE goal on individual contracts based upon the type of work included in each contract and on the availability of the four targeted groups capable of performing such work. Using the good-faith effort standards to justify award when the goal is not met. Encouraging prime bidders to use other DBEs, whenever possible, as a race-neutral component. 36. The 2009 DBE Program identifies 57 race-neutral measures Caltrans intends to PACIFIC LEGAL FOUNDATION 11 pursue. The race neutral measures include business outreach and communication, technical 12 assistance, improved contracting process and data collection, monitoring, and reporting. Id. at 7. 13 However, the race-neutral measures do not include the enforcement of any antidiscrimination laws. 14 Id. at Attachment C. 15 37. On February 25, 2009, FHWA conditionally approved Caltrans’ 2009 DBE Program 16 that requires Caltrans to move from its current race-neutral contracting policy to a race-conscious 17 policy. A true and correct copy of the February 25, 2009, letter from Walter C. Waidelich, Jr., 18 California Division Administrator FHWA, to Will Kempton, is attached hereto as Exhibit 3, and 19 is incorporated herein by reference. 20 38. On March 4, 2009, Caltrans announced to the “Transportation Construction 21 Community,” and all California cities, counties, metropolitan planning organizations, and regional 22 transportation planning agencies that Caltrans and all local agencies receiving federal funds must 23 implement the race-conscious DBE program for FY 2009. A true and correct copy of the March 4, 24 2009, letter from Denix D. Anbiah, Chief of Caltrans’ Division of Local Assistance, to All Cities, 25 et al., is attached hereto as Exhibit 4 and incorporated herein by reference. A true and correct copy 26 of the March 4, 2009, letter from Will Kempton to the Transportation Construction Community 27 is attached hereto as Exhibit 5 and incorporated herein by reference. Under the 2009 DBE 28 Program, Plaintiff’s members and other prime contractors must either hire African American, Complaint for Declaratory & Injunctive Relief No. __________ - 12 - 1 Native American, Asian Pacific American, or women owned firms or demonstrate “good-faith 2 effort[s]” to obtain the required DBE participation. Exhibit 1 at 8. On April 2, 2009, USDOT gave 3 full approval to Caltrans to implement its 2009 DBE Program. A true and correct copy of the 4 April 2, 2009, letter from Walter C. Waidelich, Jr., California Division Administrator, FHWA, to 5 Will Kempton, is attached hereto as Exhibit 6, and is incorporated herein by reference. 6 39. Plaintiff is informed and believes, and on that basis alleges, that Defendants do not 7 believe that any of Caltrans’ officials or subrecipients of federal aid has engaged in discrimination. 8 Nor do Defendants believe that any segment of prime contractors contracting with Caltrans has 9 engaged in discrimination. 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 40. Plaintiff is informed and believes, and on that basis alleges, that Caltrans will PACIFIC LEGAL FOUNDATION 11 continue to rely on the 2007 Availability and Disparity Study in submitting annual DBE goals and 12 methodology in the future to USDOT. The continued operations of Defendants in the proposal, 13 implementation, and enforcement of the 2009 DBE Program are unlawful and are contrary to the 14 obligations of Defendants’ respective public offices and the trusts and duties arising therefrom. 15 16 41. INJUNCTIVE RELIEF ALLEGATIONS Plaintiff incorporates by reference and realleges each and every allegation set forth 17 in paragraphs 1 through 40 of this Complaint. 18 42. Defendants have proposed and are implementing the 2009 DBE Program, which sets 19 an overall DBE goal of 13.5% to be achieved in equal proportion by race-neutral and 20 race-conscious measures. If an injunction does not issue enjoining these Defendants from 21 implementing and enforcing the race-conscious measures of the 2009 DBE Program, Plaintiff will 22 be irreparably harmed in that Plaintiff and its members will be discriminated against on the basis 23 of race and sex under the 2009 DBE Program in their bidding on contracts as prime contractors and 24 subcontractors, and Plaintiff and its members will be required to grant unlawful preferences to 25 preferred minority- and women-owned businesses in solicitation and award of subcontracts, 26 exposing them to potential liability under both 42 U.S.C. § 1983, as a quasi-governmental actor, 27 and Article I, section 31, of the California Constitution, or be denied contracts on the basis that they 28 did not comply with an unconstitutional program. Complaint for Declaratory & Injunctive Relief No. __________ - 13 - 1 43. If not enjoined by this Court, Defendants will continue to administer, implement, 2 utilize, rely on, or enforce a discriminatory DBE program now and in the future unless restrained 3 in derogation of the rights of Plaintiff. 4 44. Pecuniary compensation to Plaintiff or other victims of such continuing 5 discrimination would not afford adequate relief, or it would be extremely difficult to ascertain the 6 amount of compensation that would afford adequate relief. 7 45. Restraint of Defendants is necessary to prevent a multiplicity of judicial proceedings 8 on these same or similar issues. 9 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 46. Accordingly, injunctive relief is appropriate. DECLARATORY RELIEF ALLEGATIONS PACIFIC LEGAL FOUNDATION 11 47. Plaintiff incorporates by reference and realleges each and every allegation set forth 12 in paragraphs 1 through 46 of this Complaint. 13 48. An actual and substantial controversy exists between the Plaintiff and the 14 Defendants as to their respective legal rights and duties. Plaintiff contends that the establishment, 15 administration, reliance, and implementation of Defendants’ 2009 DBE Program race-conscious 16 goals violates the Equal Protection Clause of the Fourteenth Amendment to the United States 17 Constitution; 42 U.S.C. §§ 1981, 1983, 2000d; as well as Article I, section 31, of the California 18 Constitution. Plaintiff contends, among other things, that Caltrans’ reliance on the 2007 19 Availability and Disparity Study for its DBE goals is flawed in that the disparity study does not 20 prove racial discrimination, that Caltrans has failed to exhaust race-neutral alternatives before 21 resorting to race-conscious methods, Caltrans has failed to properly calculate the race neutral share 22 in its 2009 DBE program, the 2009 DBE program presumes all members of the preferred racial 23 groups and women are socially disadvantaged without requiring a showing that they have suffered 24 discrimination within the state, and the disparity study has conceptual flaws regarding availability 25 and capacity of DBE firms. Plaintiff is informed and believes, and therefore alleges, that the 26 Defendants dispute that its race-conscious requirements are unconstitutional. 27 49. There is a present justiciable controversy between the parties regarding the 28 constitutionality of Defendants’ race- and sex-based requirements. Plaintiff’s members include Complaint for Declaratory & Injunctive Relief No. __________ - 14 - 1 construction firms that have been, are, and will be directly, adversely, and irreparably affected by 2 Caltrans’ 2009 DBE Program and Caltrans continuing administration, implementation, reliance, 3 and enforcement of a discriminatory DBE program now and in the future. A judicial determination 4 of rights and responsibilities arising from this actual controversy is necessary and appropriate at 5 this time. 6 7 8 9 50. Plaintiff incorporates by reference and realleges each and every allegation set forth FIRST CLAIM FOR RELIEF VIOLATION OF FOURTEENTH AMENDMENT AGAINST DEFENDANTS (Caltrans’ 2009 DBE Goal and Methodology) 10 in paragraphs 1 through 49 of this Complaint. 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 51. The Equal Protection Clause of the Fourteenth Amendment to the United States 12 mandates that, “[n]o State shall . . . deny to any person within its jurisdiction the equal protection 13 of the laws.” U.S. Const. amend. XIV, § 1. The Fourteenth Amendment protects persons, not 14 groups, and all governmental action based on race must be subjected to detailed judicial scrutiny 15 to ensure that the personal right to equal protection of the laws has not been infringed. 16 52. Defendant Caltrans’ 2009 DBE Program, on its face, sets a participation goal of 17 13.5%, of which 6.75% is to be achieved through race-conscious measures. Plaintiff is informed 18 and believes, and therefore alleges, that Defendants proposed and are enforcing this goal, although 19 Defendants’ 2007 Availability and Disparity Study is deficient, and Defendants have no evidence 20 of intentional discrimination on the part of Caltrans, private contractors, or anywhere in the 21 California transportation construction industry to satisfy strict scrutiny. 22 53. In Western States, the Ninth Circuit held that race-conscious goals can be applied 23 only where the effects of discrimination are present. Western States, 407 F.3d at 1002. Caltrans’ 24 establishment and implementation of its 2009 DBE goals as a condition to receive federal funding, 25 without evidence of intentional discrimination in the California transportation contracting industry, 26 and which require contractors to use race- and sex-based preferences as a factor in the award and 27 performance of contracts, is a violation of the Equal Protection Clause of the Fourteenth 28 Amendment to the United States Constitution. Complaint for Declaratory & Injunctive Relief No. __________ - 15 - 1 54. Further, Caltrans’ 2009 DBE Program is not narrowly tailored because Caltrans 2 lacks evidence that those preferred minority groups and women have actually suffered 3 discrimination within the State. Among other things, the 2007 Availability and Disparity Study 4 Caltrans relies upon is flawed in that the disparity study does not prove racial discrimination; 5 Caltrans has failed to exhaust race-neutral alternatives before resorting to race-conscious methods; 6 Caltrans has failed to properly calculate the race neutral share in its 2009 DBE Program; the 2009 7 DBE Program presumes all members of the preferred racial groups and women are socially 8 disadvantaged without requiring a showing that they have suffered discrimination within the state; 9 and, the disparity study has conceptual flaws regarding availability and capacity of DBE firms. 10 Thus, the DBE Program provides certain preferred minorities- and women-owned businesses who 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 have not encountered discriminatory barriers with an unconstitutional competitive advantage at the 12 expense of nonminorities male-owned businesses and businesses owned by male Hispanic 13 American and male Subcontinent Asian American businesses who are not included in the race14 conscious portion of the program in violation of the Equal Protection Clause of the Fourteenth 15 Amendment to the United States Constitution. 16 17 18 19 55. Plaintiff incorporates by reference and realleges each and every allegation set forth SECOND CLAIM FOR RELIEF VIOLATION OF 42 U.S.C. § 1981 AGAINST DEFENDANTS (Caltrans’ 2009 DBE Goal and Methodology) 20 in paragraphs 1 through 54 of this Complaint. 21 56. At all times mentioned herein, Plaintiff has been a person within the meaning of 22 42 U.S.C. § 1981. 23 57. Defendants have adopted Caltrans’ 2009 DBE Program setting a participation goal 24 of 13.5%, of which 6.75% is to be achieved through race-conscious measures. Plaintiff is informed 25 and believes, and therefore alleges, that Defendants proposed and are enforcing this goal, although 26 Defendants’ 2007 Availability and Disparity Study is deficient, and Defendants have no evidence 27 of intentional discrimination on the part of Caltrans, private contractors, or anywhere in the 28 transportation construction industry, to satisfy strict scrutiny. Complaint for Declaratory & Injunctive Relief No. __________ - 16 - 1 58. Plaintiff desires to submit bids for public construction contracts that are subject to 2 Caltrans’ 2009 DBE Program. Plaintiff will be denied equal access to said contracts solely on 3 account of their race and sex. This denial results in irreparable injury to Plaintiff and has left 4 Plaintiff without an adequate remedy at law. As designed, implemented, and enforced, Caltrans’ 5 2009 DBE Program intentionally discriminates against nonminority, male-owned businesses by 6 subjecting them to unequal and disadvantageous treatment in their competition for federally funded 7 construction contracts, and requires and encourages prime contractors to discriminate against 8 others—all to the present and continuing injury of the Plaintiff, its members, and the general 9 public. Caltrans’ 2009 DBE Program likewise grants a preference to certain businesses based upon 10 the business owners’ race, sex, or ethnicity. Defendants’ 2009 DBE program discriminates against 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 and grant preferences on the basis of race in violation of the provisions of 42 U.S.C. § 1981. 12 13 14 15 59. Plaintiff incorporates by reference and realleges each and every allegation set forth THIRD CLAIM FOR RELIEF VIOLATION OF 42 U.S.C. § 1983 AGAINST DEFENDANTS (Caltrans’ 2009 DBE Goal and Methodology) 16 in paragraphs 1 through 58 of this Complaint. 17 60. At all times mentioned herein, Plaintiff has been a citizen of the United States or 18 other persons within the meaning of 42 U.S.C. § 1983. 19 61. At all times mentioned herein, Defendants have been a person acting under color 20 of law of the State of California within the meaning of 42 U.S.C. § 1983. 21 62. Defendant Caltrans’ 2009 DBE Program intentionally subjects nonminority, 22 male-owned businesses; Hispanic American, male-owned businesses; and Subcontinent Asian, 23 male-owned businesses to unequal and disadvantageous treatment in their competition for federally 24 funded construction contracts, by discriminating against them and granting preferences to African 25 American, Asian Pacific American, women, and Native American businesses—all to the present 26 and continuing injury of the Plaintiff, its members, and the general public. Caltrans’ 2009 DBE 27 Program likewise grants a preference to certain businesses based upon the business owners’ race, 28 sex, or ethnicity. Complaint for Declaratory & Injunctive Relief No. __________ - 17 - 1 63. Defendants’ policy and practice of intentionally discriminating and granting 2 preferences based upon race in the award of public contracts, through the implementation and 3 enforcement of the 2009 DBE Program, exceeds Defendants’ authority and intentionally deprives 4 Plaintiff and its members of their rights, privileges, or immunities secured by the Constitution and 5 laws of the United States under color of state law. 6 7 8 9 64. Plaintiff incorporates by reference and realleges each and every allegation set forth FOURTH CLAIM FOR RELIEF VIOLATION OF 42 U.S.C. § 2000d AGAINST DEFENDANTS (Caltrans’ 2009 DBE Goal and Methodology) 10 in paragraphs 1 through 63 of this Complaint. 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 PACIFIC LEGAL FOUNDATION 11 65. At all times mentioned herein, Plaintiff has been a person within the meaning of 12 Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d. 13 66. Title VI prohibits any person in the United States from being subjected to 14 discrimination under any program or activity receiving federal funds, on the basis of race, color, 15 or national origin. 42 U.S.C. § 2000d. 16 67. As designed, implemented and enforced, Caltrans’ 2009 DBE Program subjects 17 nonminority, male-owned business; Hispanic American male-owned businesses; and Subcontinent 18 Asian American male-owned businesses to discriminatory, unequal and disadvantageous treatment 19 in their competition for federally funded highway construction contracts, and requires and 20 encourages prime contractors to discriminate them on the basis of race, color, or national origin. 21 68. The contracts awarded by Defendants through the 2009 DBE Program, including 22 all of those which are awarded based upon DBE participation, are funded by federal financial 23 assistance programs. The Defendants’ implementation and enforcement of the 2009 DBE Program, 24 which intentionally discriminates and grants preferences on the basis of race, color, and national 25 origin, thus violates 42 U.S.C. § 2000d. 26 /// 27 /// 28 /// Complaint for Declaratory & Injunctive Relief No. __________ - 18 - 1 2 3 4 69. FIFTH CLAIM FOR RELIEF VIOLATION OF ARTICLE I, SECTION 31, OF THE CALIFORNIA CONSTITUTION AGAINST DEFENDANTS (Caltrans’ 2009 DBE Goal and Methodology) Plaintiff incorporates by reference and realleges each and every allegation set forth 5 in paragraphs 1 through 68 of this Complaint. 6 70. Article I, section 31, of the California Constitution prohibits state and local 7 governments—including Defendants—from granting preferential treatment to, or discriminating 8 against, any group or individual on the basis of race, color, ethnicity, sex, or national origin in the 9 operation of public contracting. 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 71. As designed, administrated, implemented, and enforced, Caltrans’ 2009 DBE PACIFIC LEGAL FOUNDATION 11 Program subjects nonminority, male-owned businesses; Hispanic American, male-owned 12 businesses; and Subcontinent Asian American, male-owned businesses to discriminatory, unequal, 13 and disadvantageous treatment in their competition for federally funded construction contracts, and 14 requires and encourages prime contractors to discriminate against others—all to the present and 15 continuing injury of the Plaintiff, its members, and the general public. Caltrans’ 2009 DBE 16 Program likewise grants a preference to certain businesses based upon the business owners’ race, 17 sex, or ethnicity. Caltrans’ race- and sex-based discriminatory and preferential policies consist of 18 the establishment of goals for the percentage of contract awards that should be directed to 19 businesses owned by preferred minorities and women-owned business enterprises, the enforcement 20 of goals for participation of preferred minority-owned and women-owned business enterprises, 21 recruitment, or “good faith effort” requirements for the participation of preferred minority-owned 22 and women-owned businesses, and the punishing of prime contractors by refusing to consider bids 23 that fail to satisfy the quota or good faith effort requirements for preferred minority-owned and 24 women-owned business enterprises. 25 72. Section 31(e) authorizes race-based governmental action in order to “establish or 26 maintain eligibility for any federal program, where ineligibility would result in a loss of federal 27 funds to the state.” Cal. Const. art. I, § 31(e). However, in order for Caltrans to meet this 28 exception, it “must have substantial evidence that it will lose federal funding if it does not use Complaint for Declaratory & Injunctive Relief No. __________ - 19 - 1 race-based measures and must narrowly tailor those measures to minimize race-based 2 discrimination.” C & C Constr., 122 Cal. App. 4th at 298. Plaintiff is informed and believes, and 3 upon such belief alleges, that Caltrans’ 2009 DBE Program does not meet the requirements of 4 Section 31(e) in that it does not have substantial evidence that it will lose federal funding if it does 5 not use race-based measures and that those measures are not narrowly tailored to minimize 6 race-based discrimination. 7 8 PRAYER FOR RELIEF WHEREFORE, based on the allegations above, Plaintiff respectfully requests judgment as 9 follows: 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 1. A declaration that the Disadvantaged Business Enterprise Amended Goal and PACIFIC LEGAL FOUNDATION 11 Methodology, Federal Fiscal Year 2009 program adopted by the California Department of 12 Transportation; Will Kempton, Director of the California Department of Transportation; and Olivia 13 Fonseca, Deputy Director of the California Department of Transportation, is unconstitutional, 14 invalid, and unenforceable to the extent that it grants preferential treatment on the basis of race, 15 sex, color, ethnicity, or national origin while discriminating against nonminority- and male-owned 16 businesses, and businesses owned by male Hispanic Americans and male Subcontinent Asian 17 Americans on the basis of race, sex, color, ethnicity, or national origin in violation of the 18 Fourteenth Amendment to the United States Constitution; 42 U.S.C. §§ 1981, 1983, 2000d; and 19 Article I, section 31, of the California Constitution. 20 2. For a preliminary and permanent prohibitory injunction enjoining the California 21 Department of Transportation; Will Kempton, Director of the California Department of 22 Transportation; and Olivia Fonseca, Deputy Director of the California Department of 23 Transportation; their agents, employees, officers, and representatives from adopting, enforcing, 24 attempting, or threatening to enforce the Disadvantaged Business Enterprise Amended Goal and 25 Methodology, Federal Fiscal Year 2009, program, or any other disadvantaged business enterprise 26 program, insofar as the program discriminates against or grants preferential treatment to any 27 individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of 28 public contracting now and in the future. Complaint for Declaratory & Injunctive Relief No. __________ - 20 - 1 2 3 4 5 6 7 8 3. 4. For legal costs, expenses, and attorneys’ fees. For such other relief as the Court deems proper and just. DATED: June 11, 2009. Respectfully submitted, SHARON L. BROWNE RALPH W. KASARDA ANTONIO J. SENAGORE By 9 10 3900 Lennane Drive, Suite 200 Sacramento, CA 95834 (916) 419-7111 FAX (916) 419-7747 s/Ralph W. Kasarda RALPH W. KASARDA Attorneys for Plaintiff PACIFIC LEGAL FOUNDATION 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Complaint for Declaratory & Injunctive Relief No. __________ - 21 - EXHIBIT 1 EXHIBIT 2 EXHIBIT 3 EXHIBIT 4 EXHIBIT 5 EXHIBIT 6