to base its financial calculations upon the cost of the implementation of a new system design not previously submitted.
Finally, we find the alleged limits placed on Teleprompter by Coucil's representatives at the negotiating session of October 28 create factual issues which warrant a denial of defendant's motion for summary judgment. Plaintiff offers evidence that the negotiations were restricted only as to Teleprompter by City Solicitor Rogala. Mr. Fischer stated in deposition that the scope of the negotiations scheduled for October 28, 1980, were defined by the oral statements of Mr. Rogala at the initiation of the sessions. Fischer stated, "he wanted us to limit our proposal to the financial matters, because they had gotten beyond that in the morning (with ETI) and into extraneous matters, and he did not want that to occur in the afternoon." Fischer deposition, p. 10.
Mr. Adams, a representative of Teleprompter, also indicated in deposition testimony that in setting the guidelines for the meeting of October 28, Mr. Rogala indicated that the negotiations would be limited to financial matters. Adams deposition, p. 48.
We find this testimony, in light of ETI's system design changes, if believed by the trier of facts, would demonstrate arbitrariness on the part of the City in the award of the cable franchise.
Defendant argues that oral pronouncements, such as those attributed to Rogala by Fischer and Adams, cannot be considered the official dictates of Council. Municipal legislative bodies are generally not to be bound by statements of individual members, but only by properly sanctioned Resolutions or Ordinances.
We find this sweeping assertion deficient in two respects. First, in the context of municipal law, a city attorney may bind a municipality to the same extent that any attorney may bind his client. 10 McQuillen Mun. Corp. (3d Ed.) § 29.15. Second, municipal contracts may be made through appropriate committees of the Council providing such committees are duly authorized. If a municipality chooses to be bound by the actions of a committee, it may do so by resolution or ordinance.
On September 10, 1980, the City Council passed a resolution forming a committee to negotiate a cable franchise agreement on behalf of the City. We find this action of Council and the action of the Committee where the latter acted with the approval of the former sufficient to bind Council. We are mindful that the actions of the Committee were reviewed and approved by Council.
In conclusion and in accordance with our decision regarding plaintiff's partial estoppel, we will not consider plaintiff's due process or equal protection claims as they relate to ETI's private negotiations with Council after its selection as the lone successful bidder. We find that the existence of material issues of fact preclude a grant of summary judgment for either party as to the due process component of Count I, and the respective motions of the parties are denied.
We now turn to plaintiff's equal protection claim contained in Count I. We note from the outset that in order to prevail on this equal protection claim plaintiff must establish not only that it was actually discriminated against, but also, because plaintiff is not a member of a suspect class, that the alleged discrimination was purposeful or intentional. Cook v. City of Price, Carbon County, 566 F.2d 699, 701 (10th Cir. 1977); Polite v. Diehl, 507 F.2d 119, 138 (3d Cir. 1974); Burt v. City of New York, 156 F.2d 791, 792 (2d Cir. 1946). Further, we have no doubt that plaintiff may prevail under an equal protection claim if it is able to demonstrate intentional discrimination in the context of the award of a cable franchise. The Equal Protection Clause has been held to compel state authorities to deal with similarly situated organizations in an even-handed manner. Pliscou v. Holtville Unified School Dist., 411 F. Supp. 842 (S.D. Cal. 1976). Such claims have been held enforceable when they arise in the commercial setting where plaintiff have challenged unequal application of otherwise neutral provisions. See, Cook v. City of Price, supra; Three Rivers Cablevision v. City of Pittsburgh, supra; Milnot Company v. Arkansas State Board of Health, 388 F. Supp. 901 (E.D. Ark. 1975). We note further that the concepts of equal protection and due process are not mutually exclusive. Lee v. Habib, 137 U.S. App. D.C. 403, 424 F.2d 891 (D.C. Cir. 1970), Kline v. Vlandis, 346 F. Supp. 526 (D.C. Conn. 1972); nor are they coterminous. Allied Am. Mutual Fire Ins. Co. v. Commissioner of Motor Vehicles, 219 Md. 607, 150 A. 2d 421 (1959).
We have previously considered the alleged improprieties attending the negotiating session of October 28, 1980, in the context of alleged due process violations and we now conclude that issues of fact do exist that if resolved in favor of the plaintiff would sustain recovery under the Equal Protection Clause. We find a genuine factual dispute as to whether plaintiff's representatives were restricted to a presentation of financial matters at the session held October 28. Accordingly, we find this evidence, the same needed to support plaintiff's due process claim, if believed by the trier of fact, would demonstrate purposeful discrimination on the part of the City of Erie and the Council of the City of Erie in the award of the cable franchise. The motions of the parties for summary judgment with respect to the Equal Protection component of Count I must, therefore, be denied.
(1) Plaintiff's Equal Protection Claim under 42 U.S.C. § 1983 against defendants Meredith, ETI and GEEDC.
Justice Holmes once remarked that "temptation is not always invitation". Erie Railroad v. Hilt, 247 U.S. 97, 101, 62 L. Ed. 1003, 38 S. Ct. 435 (1917). Plaintiff has alleged in Count II of its complaint that the defendants Meredith, ETI and GEEDC engaged in a conspiracy whereby ETI and GEEDC would give Meredith financial benefits in exchange for his favorable vote as a councilman. It is undisputed that on or about July 1980 certain parties affiliated in some capacity with GECAC, who at the time was a fund recipient from GEEDC (a ten percent shareholder in Erie Telecommunications, Inc.), met with Mayor Tullio at the Erie Hilton Hotel to discuss a testimonial for Council President Meredith. Plaintiff alleges that impetus for the purported fund raiser was to influence Meredith's vote in the upcoming award of the cable franchise.
Plaintiff asserts that facts surrounding the fund raiser support the inference that Meredith was bribed and that the defendants conspired to procure the support for ETI in the selection process.
Larry Meredith has replied to plaintiff's allegations by asserting that there are no facts which would support plaintiff's allegation that he either conspired to take a bribe or took a bribe to influence the vote of council. The defendant GEEDC asserts that there is no evidence which indicates that any of the officers, directors, employees and/or staff of GEEDC were involved in the organization and promotion of the Meredith testimonial and that participation in the fund raiser was based upon a criteria which was entirely independent of any relationship with GEEDC. The defendants Erie City Council and the City of Erie challenge Count II of plaintiff's complaint on the grounds that the "visceral allegations" against Councilman Meredith do not constitute a civil rights claim against Erie or the Erie City Council.
In considering the issues raised in Count II we note that Meredith endorses the legal arguments presented by ETI and essentially leaves the detailed legal analysis to others. (See Meredith Reply Brief, p.2). It is apparent from the facts that Meredith's role in the alleged conspiracy is determinative of plaintiff's Section 1983 cause of action set forth in Count II. This is true both in fact and in law. Factually, there is no basis which can exist for a conspiracy allegation to bribe Meredith into providing a vote during the cable franchise award if Meredith himself was not a participant in the alleged conspiracy. Legally, a cause of action under Section 1983 cannot be sustained against the private parties without Meredith. Purely private action is not cognizable under Section 1983. In order for a private person who acts in his private capacity to be held liable under Section 1983, it is necessary that that person act in concert with a public official who acts "under color of state law". See e.g. Black v. Bayer, 672 F.2d 309 (3d Cir. 1982); Jennings v. Shuman, 567 F.2d 1213, 1220 (3d Cir. 1977); Celano v. Celano, 537 F. Supp. 690 (E.D. Pa. 1982); Raitport v. Provident National Bank, 451 F. Supp. 522 (E.D. Pa. 1978); Meyer v. Curran, 397 F. Supp. 512 (E.D. Pa. 1975); Beaver v. Boro. of Johnsonburg, 375 F. Supp. 326 (W.D. Pa. 1974). Accordingly, the cause of action in Count II under Section 1983 fails as to the City defendants, ETI, and GEEDC if it fails as to Meredith since the actions of Meredith provide the necessary state action.
As Meredith has deferred to the arguments of ETI, we will be guided for purpose of analysis by the arguments raised by ETI and the challenges therein to Count II of plaintiff's complaint.
A) Color of State Law.
Defendant ETI first contends that Meredith's actions were not taken under color of state law. There is no dispute in this case that Councilman Meredith was not authorized by a policy or custom of council to accept a bribe or otherwise to act on his own to violate the plaintiff's civil rights. ETI relies upon Mosher v. Beirne, 237 F. Supp. 684 (E.D. Mo. 1964), where the court held that where authority is lacking to deprive another of his guaranteed rights then there is no color of law necessary to sustain a civil rights action. 237 F. Supp. at 687.
We find the defendant's argument meritless. The Civil Rights Act does not exclude from its purview the wrongful acts of an official for which the official has no authority. In Basista v. Weir, 340 F.2d 74 (3d Cir. 1965) the court held that a wrongdoer is cloaked with the authority of state law for purposes of Section 1983 when he exercises a power that he possesses by virtue of state law. We will reject defendant ETI's challenge to Count II of Plaintiff's Complaint based on a failure to satisfy the under color of state law requirements of a Section 1983 cause of action.
B) The Conspiracy to Bribe Meredith.
Defendant ETI in support of its motion for summary judgment, asserts that the defendants lacked the ability to violate the plaintiff's civil rights. The defendants' challenge is not unlike a motion to dismiss for failure to state a claim. When treated as such it is apparent that in order for Count II of plaintiff's complaint to fail on the inadequacy of its substantive allegations, the defendants are obliged to demonstrate that under no set of facts could the defendants' joint participation in the conspiracy result in the deprivation of plaintiff's rights. This they cannot do. This court will not inquire of the innumerable circumstances under which a conspiracy or the threat of a conspiracy to bribe a member of a legislative body might in fact dictate the results of votes or negotiations undertaken by that legislative body. This challenge must be rejected.
The more compelling argument is ETI's assertion that the facts are undisputed that no conspiracy existed to bribe Meredith.
The basis for plaintiff's allegation in paragraph 10 of its complaint are more fully set forth in paragraphs 40 through 47 of the complaint. Plaintiff now contends that genuine issues of material fact preclude summary judgment on the equal protection claim set forth in Count II. For the reasons that follow we disagree and will enter summary judgment in favor of the defendants as to Count II.
The law of this Circuit and the law of summary judgment generally requires that the party responding to a motion for summary judgment set forth "countervailing evidence establishing a genuine factual dispute." See, e.g., Scooper Dooper, Inc. v. Kraftco Corp., 494 F.2d 840, 848 (3d Cir. 1974); First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 20 L. Ed. 2d 569, 88 S. Ct. 1575 (1968); Perma Research and Development Co. v. Singer Co., 410 F.2d 572, 578 (2d Cir. 1969); Radio City Music Hall Corp. v. United States, 135 F.2d 715 (2d Cir. 1943). It is also recognized that summary judgment should be granted only where it is clear that there is no genuine dispute about either the facts or the inferences to be drawn from such facts. United States v. Diebold, Inc., 369 U.S. 654, 655, 8 L. Ed. 2d 176, 82 S. Ct. 993 (1962). This is particularly critical where intent is a controlling element. Schmidt v. McKay, 555 F.2d 30, 37 (2d Cir. 1977); Mutual Fund Investors v. Putnam Management Co., 553 F.2d 620, 624 (7th Cir. 1977). Accordingly, even though there may be no dispute about the basic facts, still summary judgment will be inappropriate where the parties disagree on the inferences which may reasonably be drawn from those facts. Winters v. Highlands Ins. Co., 569 F.2d 297, 299 (5th Cir. 1978); Exnicious v. United States, 563 F.2d 418, 423-24 (10th Cir. 1977). And summary judgment is "likely to be inappropriate when issues of motive, intent, and other subjective feelings and reactions are material." 6J Moore, Moore's Federal Practice para. 56.17 [41.-1] (2d ed. 1982); Adickes v. S.H. Kress & Co., 398 U.S. 144, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970).
Far from creating the inference that Meredith participated in a bribery scheme to secure the cable franchise for ETI, an almost elementary review of the chronology of events surrounding the Meredith testimonial as well as the nature and basis of its origin and promotion, demonstrate clearly that no impropriety was effectuated through the office of Meredith by promoters of ETI or GEEDC.
The initial discussion of the Meredith testimonial occurred on or about July 9, 1980 at the Hilton meeting. The meeting was called to discuss the development of a revolving loan program for the Community Development Block Grant Program and the City Community Service Administration to assist minority contractors. The conversation turned to the subject of Larry Meredith testimonial at the suggestion of Mayor Tullio. Fred Rush's recollection is consistent with that of all the others present. According to Rush the Mayor stated:
. . . the black community had never really shown their appreciation of him. And he realized that by being on City Council, Larry had probably hurt his law practice from the time that City Council takes out, and he said it would be nice if we had a testimonial for the black community and the white community to really show that they care about Larry. (Rush Deposition, pp. 20-21).
It was agreed that a testimonial would take place at the Mayor's home and that Fred Rush would assist the Mayor in notifying prospective invitees from among the black community. Apparently, this was a common arrangement between Rush and the Mayor when the latter organized social or political affairs. It is undisputed that Mayor Tullio and Rush subsequently organized and planned the testimonial with the Mayor providing for tickets, food, beverages and invitees from among the white community, and Rush acting as a liaison with prominent members of the Erie black community.
The fact that Mayor Tullio and Rush were the prime movers of the event is unrefuted by the plaintiff. However, the plaintiff contends that the testimonial was "organized and planned by representatives of GEEDC." Mayor Tullio and Fred Rush were both members of GEEDC's Advisory Board of Directors. Plaintiff's argument presumes that in planning the testimonial these men acted with a purpose designed to further the interest of GEEDC. There is no evidence in all the amassed data currently before the court that would support such an inference. There is nothing in the manner of affairs alluded to by the plaintiff which would suggest that it was improper for the Mayor and an Assistant, both advisory members of an organization engaged in community economic development, to contemplate a testimonial for Meredith. We are reminded that plaintiff must at least demonstrate a factual question in order to avoid an award of summary judgment in favor of the defendant. The plaintiff must stand upon more than its allegations.
The plaintiff argues further that "GEEDC representatives" attended the fundraiser and paid money to Meredith. It is true that many of the black guests in attendance were affiliated in some capacity with GEEDC. However, there is no evidence to indicate that their attendance was prompted by this affiliation or a desire to influence Meredith in his capacity as Council President. Moreover, we do not find it unusual that in a city the size of Erie many of the prominent individuals invited from among the black community might also have some affiliation with an organization involved in the ongoing work of economic development. Mr. Rush described the process by which he selected prospective invitees:
A. I sat down and wrote the names out. These would be the same people I would invite if the Mayor said to me, "Next week Andy Young is coming to town and I want twenty black folks on the steps of City Hall." They are people who usually show up. If not show up or contribute to at least make their presence known, in some form or fashion.
Q. And these would be more or less prominent people in the black community?