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MAIN LINE PAVING CO. v. BOARD OF EDUC.

November 29, 1989

MAIN LINE PAVING CO., INC., BERNARD A. FAGGIOLI
v.
BOARD OF EDUCATION, SCHOOL DISTRICT OF PHILADELPHIA



The opinion of the court was delivered by: WEINER

 CHARLES R. WEINER, UNITED STATES DISTRICT JUDGE

 I. Introduction.

 In its complaint Main Line alleges that the Board's affirmative action requirements and the so called Addendum No. 1 attached to the subject contract, together with the Board's standard operating procedure, are violative of the Equal Protection Clause because they create race and gender conscious classifications, assigning favored status to minorities and women in the award of construction contracts. As such, Main Line argues the set aside program fails to pass the strict scrutiny requirement for these types of benign classifications recently announced by the United States Supreme Court in City of Richmond v. J.A. Croson Co., 488 U.S. 469, 109 S. Ct. 706, 102 L. Ed. 2d 854 (1989). The Board responds that Main Line, as a mere unsuccessful bidder, has no cause of action; that since the contract has already been rebid and let, the question is moot; and that the plaintiffs have no standing to bring this action. We will first recount the stipulated facts, set out the standard for deciding motions for summary judgment, then address the arguments regarding standing and mootness, each of which are threshold issues.

 II. Stipulated Facts.

 The parties have submitted the issue on the following joint stipulation of facts:

 1. This is an action by plaintiffs, Main Line Paving Co., Inc. and Bernard A. Faggioli, against the Board of Education, School District of Philadelphia, for injunctive relief, a declaratory Judgment [sic] and damages, pursuant to the Fourteenth Amendment to the United States Constitution and 42 U.S.C. § 1983, arising out of the failure of the Board . . . to award Main Line . . . a contract for Specification B-91 of 1988/1989 for the demolition and related work on the former R.L. Wright School.

 2. Plaintiffs' prayers for temporary and permanent injunctive relief in the form of an order prohibiting the Board from opening the bids and from awarding the contract to any one other than Main Line are moot.

 3. Bernard A. Faggioli is a citizen and taxpayer of the Commonwealth of Pennsylvania, and is President of Main Line.

 4. Main Line . . . is a Pennsylvania corporation . . .

 5. The School District . . . is a political subdivision under 53 P.S. section 1-101 et seq. [sic] and 351 Pa. Code section 12.12.100 et seq. . . . The Board . . . is its policy-making body.

 6. At all relevant times, the Board was acting under color of state law.

 7. . . . . *fn1"

 8. Main Line is a construction contractor qualified to bid on construction contracts let by the Board.

 9. On or about November 22, 1988, the Board advertised for bids on Specification No. B-91 of 1988/1989 (the "contract") for the demolition and asbestos removal at the former R.L. Wright School.

 11. There exist in the construction industry reports known as "Dodge Reports", which are published showing public entities that are advertising for bids on construction projects, the bid opening date and other information relevant to a contractor preparing and submitting bids on public contracts.

 12. Main Line obtained a Dodge Report dated November 22, 1988 on the Board's Specification . . . which showed a bid opening date of December 6, 1988.

 13. Main Line subsequently obtained a Dodge Report dated November 30, 1988 . . . which showed a bid opening date of December 13, 1988.

 14. Main Line obtained from the Board the necessary specifications to submit a bid for the Contract, prior to December 6, 1988.

 15. Prospective bidders were advised of the Board's affirmative action policy by way of a document entitled Addendum No. 1 (Revised) of the General Conditions, which was attached to and made part of the contract's specifications.

 16. Addendum No. 1 had as its subject matter "School District's Policy on Subcontracting Opportunities for Minority/Women-Owned Businesses." Its provisions included the following:

 
NOTICE
 
This is to advise you of a change in the School District of Philadelphia bidding conditions as stated below. The following paragraph is [sic] *fn2" hereby a requirement of this bid specification and you are cautioned THAT FAILURE TO COMPLY AT THE TIME OF BID SUBMISSION WILL LEAD TO REJECTION OF YOUR BID.
 
* * * *
 
Bids over $ 200,000
 
Bids for construction, reconstruction, repairs, maintenance of work of any nature, including the installation of plumbing, heating and ventilation, or lighting systems in excess of $ 200,000 must include a minority and women-owned business subcontracting plan guaranteeing:
 
(a) No less than fifteen percent (15%) of the value of the award to minority-owned businesses; and
 
(b) No less than ten percent (10%) of the value of the award to women-owned businesses.
 
* * * *
 
For bids over $ 200,000, the following may also apply:
 
(a) Bidders which are certified minority-owned businesses may satisfy the fifteen percent (15%) MBE participation by listing themselves on the subcontracting plan. Ten percent (10%) women-owned participation is still required.
 
(b) Bidders which are certified women-owned businesses may satisfy the ten percent (10%) WBE participation by listing themselves on the subcontracting plan. Fifteen percent (15%) minority-owned participation is still required.

 17. The specification further provides that if a bidder cannot achieve the minority and women-owned business participation, in whole or in part, the contractor must file a written request for a waiver, which lists the reasons why the contractor cannot meet that participation.

 18. Since 1984, few requests for waivers have been made and few have been granted.

 19. Bids for Specification B-91 of 1988/1989 were scheduled to be opened on December 6, 1988.

 20. On December 6, 1988, at 11:00 a.m., Main Line learned that the bid opening date for the Contract was in fact December 6, 1988, and not December 13, 1988, as erroneously reported in the incorrect November 30, 1988 Dodge Report.

 22. Main Line submitted its bid of $ 239,000 on December 6, 1988, with a minority and women-owned business participation plan showing eight percent (8%) minority subcontractor participation.

 23. At all times relevant hereto, plaintiffs intended to conform their bid to and comply with all the specifications of contract B-91 of 1988/1989, including Addendum No. 1, if possible.

 24. Plaintiff Faggioli contacted a minority contractor and representatives of two women-owned businesses to ascertain their interest in participating in contract B-91 of 1988/1989, and to obtain bids from them for portions of the work involved in the contract.

 25. Because of the conflicting Dodge Reports, Main Line was unable to confirm preliminary negotiations with its potential minority and women-owned subcontractors by bid opening on December 6, 1988.

 26. At trial, Faggioli would testify that he submitted with his bid on December 6, 1988, a written request for waiver of the remaining requirements of Addendum No. 1 until Main Line could obtain the Board's goals. *fn3" On December 14, 1988, Main Line submitted a letter to the Board purportedly withdrawing its request for a waiver, because it had attained the Board's required minority and women-owned business participation. On that date, Main Line submitted to the Board a Bidder's Subcontracting Plan showing participation of a minority-owned subcontractor for fifteen percent (15%) of Main Line's bid price and participation of a women-owned subcontractor for thirty percent (30%) of Main Line's bid price.

 27. At trial, witnesses testifying on behalf on the Board would deny that plaintiffs requested a waiver, but would acknowledge receipt of Main Line's December 14, 1988 letter.

 28. Main Line's bid was for $ 239,000.00, the lowest bid of three submitted by the contractors bidding.

 28a. Plaintiff Faggioli had not decided what portion of the work Main Line would perform over that required by Addendum No. 1, or whether he would subcontract out all of the work on the contract. His decision whether to proceed one way or the other was a business decision based on which action would prove more profitable to Main Line.

 29. Main Line's bid of $ 239,000 originally anticipated that Main Line would subcontract to North American Contracting Co. ("North American"), a minority-owned firm, the asbestos removal portion of the ...


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