The opinion of the court was delivered by: BECHTLE
Presently before the court are motions for summary judgment filed by the City of Philadelphia ("City") and Richard Scott ("Scott") (jointly, "Defendants"), and the opposition thereto of Valorie Burks ("Burks"), Veronica Hodges ("Hodges"), Marcella B. Mills ("Mills"), James Roberts ("Roberts"), Linda Robb ("Robb"), Noelle E. Sewell ("Sewell"), Terence Young ("Young"), and David L. Valentine ("Valentine") (collectively, "Plaintiffs"). One motion seeks summary judgment on Plaintiffs' Title VI claim and any claim for punitive damages against the City or Scott in his official capacity. The other seeks summary judgment on the ground that six of the eight Plaintiffs cannot prevail on their employment discrimination claims and that their claims for compensatory damages should be stricken. For the reasons set forth below, the motion on the Title VI and punitive damages claims will be granted in its entirety, and the motion addressing the merits of Plaintiffs' cases and the compensatory damages issue will be granted in part and denied in part.
This civil action involves the alleged racially discriminatory employment practices of Scott, who served as director of the City's AIDS Activities Coordinating Office ("AACO") between February 1993 and July 1995. Plaintiffs are African-Americans who worked at AACO under Scott or were denied AACO jobs for which they applied during Scott's tenure. They have alleged claims under 42 U.S.C. §§ 1981, 1983, and Title VI of the Civil Rights Act of 1965, 42 U.S.C. § 2000d et seq.1
Plaintiffs commenced this civil action on March 21, 1995. For the purposes of deciding these motions, the court need not describe all the facts pertaining to the allegations in the case. In a nutshell, the Amended Complaint alleges that Scott, who is white, engaged in a pattern and practice of intentionally discriminating against African-Americans. (Am. Compl. P 10.) Plaintiffs allege that Scott intended to prevent African-Americans from advancing to senior-level positions at AACO. Id. P 11. Scott accomplished this, Plaintiffs contend, by diluting African-American employees' power and influence at the agency, rejecting African-American-led initiatives and projects, and steering funds from African-American-based AIDS community groups to their white-based counterparts. See id. P 12. The Amended Complaint also avers that Defendants' reorganizations of AACO served to eliminate African-American influence in the agency's decisions. Id. P 13. Plaintiffs seek declaratory, injunctive, and monetary relief. Id. at 8.
Defendants denied these allegations and have filed four summary judgment motions. On May 31, 1996, they filed a Motion for Summary Judgment on Plaintiffs' Title VI Claim and Claims for Punitive Damages. On June 11, 1996, they filed a Motion for Summary Judgment on All or Part of the Claims of Plaintiffs Mills, Hodges, Valentine, Sewell, Burks and Young and to Strike the Claims of all Plaintiffs for Compensatory Damages. On August 14, 1996, Defendants filed a Motion for Summary Judgment Based on Lack of Policy or Custom. On December 19, 1996, they filed a motion for Summary Judgment on All Plaintiffs' Claims. The court has received Plaintiffs' responses to the first three motions.
For the reasons set forth below, the court will grant Defendants' motion on the Title VI and punitive damages claims. The court will grant in part and deny in part the motion challenging the merits of six Plaintiffs' claims and the claims for compensatory damages. The court will defer ruling on the other two summary judgment motions.
II. LEGAL STANDARD FOR SUMMARY JUDGMENT MOTIONS
Summary judgment shall be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). Whether a genuine issue of material fact is presented will be determined by asking if "a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).
On a motion for summary judgment, the non-moving party has the burden to produce evidence to establish prima facie each element of its claim. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Such evidence and all justifiable inferences that can be drawn from it are to be taken as true. Anderson, 477 U.S. at 255. However, if the non-moving party fails to establish an essential element of its claim, the moving party is entitled to judgment as a matter of law. Celotex, 477 U.S. at 322-23.
III. MOTION REGARDING THE TITLE VI CLAIM
Count III of the Amended Complaint seeks recovery under Title VI. (Am. Compl. PP 23-24.) Of the eight Plaintiffs, only Robb and Roberts, as former AACO managers, seek relief under this statute.
They allege that Defendants subjected them to racially discriminatory employment practices at AACO, causing the intended beneficiaries of federal funds -- community groups and other persons and entities combating AIDS -- to be adversely affected on the basis of race. Id. P 24. Specifically, Robb and Roberts argue that Defendants harmed these beneficiaries by halting and refusing to fund certain programs and failing to fill vacancies in AACO's prison unit, which serves a predominantly minority clientele. (Pls.' Mem. Opp. Summ. J. at 12.)
Title VI embodies a contract-like arrangement between Congress and entities that receive money from its appropriations: "The recipient's acceptance of the funds triggers coverage under the nondiscrimination provision." United States Dep't of Transp. v. Paralyzed Veterans of Am., 477 U.S. 597, 605, 91 L. Ed. 2d 494, 106 S. Ct. 2705 (1986). The nondiscrimination provision of Title VI is Section 601, which provides that "no person in the United States shall, on the ground of race . . . be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance." 42 U.S.C. § 2000d. The United States Supreme Court has recognized that private persons have an implied right of action for monetary damages under Title VI. Consolidated Rail Corp. v. Darrone, 465 U.S. 624, 630 & n.9, 104 S. Ct. 1248, 79 L. Ed. 2d 568 (1984) (stating that a majority of the Court, in Guardians Ass'n v. Civil Service Commission of New York, 463 U.S. 582, 77 L. Ed. 2d 866, 103 S. Ct. 3221 (1983), "agreed that retroactive relief is available to private plaintiffs for all discrimination, whether intentional or unintentional, that is actionable under Title VI"); see also Franklin v. Gwinnett County Pub. Schs., 503 U.S. 60, 70, 117 L. Ed. 2d 208, 112 S. Ct. 1028 (1992).
The first issue is whether the alleged racial discrimination occurred "under a program or activity receiving federal financial assistance." The parties agree that AACO, a division of the City's Health Department, receives federal funds in the area of HIV and AIDS from two sources: The Health Omnibus Programs Extension of 1988, Pub. L. No. 100-607, tit. II, 102 Stat. 3093 (codified as amended at 42 U.S.C. § 300ee et seq.) ("CDC funds"), and the Ryan White Comprehensive AIDS Resources Emergency Act of 1990, Pub. L. No. 101-381, 104 Stat. 576 (codified as amended at 42 U.S.C. § 300ff et seq.) ("Ryan White funds") (See Defs.' Mem. Supp. Summ. J. Exs. A, B; Valentine Dep. at 346.) The City uses this money to fund AACO's operations, which, in turn, provide HIV and AIDS education, training, testing, and other health-related services to the Philadelphia community. AACO's operations qualify as a "program or activity" because such operations are "of a department, agency . . . or other instrumentality . . . of a local government."
42 U.S.C. § 2000d-4a(1)(A).
Because Robb and Roberts have alleged that Defendants subjected them to racially discriminatory employment practices, Section 604 of Title VI applies. This section provides that "nothing contained in this subchapter shall be construed to authorize action under this subchapter . . . with respect to any employment practice of any employer . . . except where a primary objective of the Federal financial assistance is to provide employment." 42 U.S.C. § 2000d-3. Thus, discriminatory employment practices can give rise to Title VI liability only when a primary objective of the federal money that Congress extends to the program or activity is to provide employment. Robb and Roberts do not contend that a primary purpose of the Ryan White or CDC funds is to provide employment.
Therefore, they cannot state a claim under 42 U.S.C. § 2000d-3.
Robb and Roberts base their claim entirely on a regulation promulgated by the Department of Health and Human Services to effectuate Title VI. See 42 U.S.C. § 2000d-1; 45 C.F.R. § 80.1. The regulation states:
Where a primary objective of the Federal financial assistance is not to provide employment, but discrimination on the ground of race . . . in the employment practices of the recipient . . . tends, on the ground of race . . . to exclude individuals from participation in, to deny them the benefits of, or to subject them to discrimination under any program to which this regulation applies, the foregoing provisions of this paragraph (c) shall apply to the employment practices of the recipient . . . to the extent necessary to assure equality of opportunity to, and nondiscriminatory treatment of, beneficiaries.
45 C.F.R. § 80.3(c)(3). The court finds that Robb and Roberts, as a matter of law, cannot prevail on a claim based on this regulation for two reasons. First, the regulation is invalid because it is inconsistent with the plain language of the statute. Second, Robb and Roberts have not presented evidence to support a finding that Defendants subjected them to a discriminatory employment practice that caused discriminatory treatment of the beneficiaries of the relevant federal financial assistance.
1. Conflict Between the Regulation and the Statute
Section 80.3(c)(3) applies when a primary objective of the relevant Federal funds is not to provide employment but racial discrimination in the employment practices of the federally funded program tends to deny individuals the benefits of a program. If these elements have been satisfied, the "foregoing provisions of this paragraph (c)" apply to the employment practices of the entity receiving the federal money, but only "to the extent necessary to assure equality of opportunity to, and nondiscriminatory treatment of, beneficiaries." This incorporates Section 80.3(c)(1), which states that, when a primary objective of the Federal financial assistance is to provide employment, the recipient of federal financial assistance may not subject an individual to racial discrimination in its employment practices.
Therefore, even though Section 80.3(c)(3) appears to be limited to discrimination in the employment practices under a program or activity that receives federal financial assistance whose primary purpose is not to provide employment, the regulation actually incorporates Section 80.3(c)(3)'s nondiscrimination provisions, which apply to programs or activities that receive assistance whose primary objective is to provide employment.
Applying the nondiscrimination prohibition to programs or activities that receive federal financial assistance that are not intended primarily to provide employment is inconsistent with 42 U.S.C. § 2000d-3 because the statute prohibits discriminatory employment practices only when the primary purpose of the federal financial assistance is to provide employment. Given this irreconcilable conflict, the statute ...