Monday, October 25, 2010

"Class of One" lives!

All men are created equal. Thomas Jefferson said that. So did the Equal Protection Clause. The Supreme Court then said that you have an equal protection case if the government singles you out for no rational basis. That was Willowbrook v. Olech, 528 U.S. 562 (2000). Two years ago, the Roberts Court scaled back the Olech case in Engquist v. Department of Agriculture, 553 U.S. 591 (2008), ruling that these so called "class of one" claims must fail if you are challenging discretionary governmental decisionmaking, employment decisions in particular. "Class of one" claims are at a crossroads.

The case is Analytical Diagnostic Labs v. Kusel, decided on October 4. Suing the government, which had aggressively investigated its operations, the Lab invoked Olech. You can't blame the Lab. We had high hopes for Class of One cases after the Supreme Court issued Olech in 2000. That case involved a municipal zoning decision where a property owner was singled out for no rational basis. But in Engquist, the Supreme Court limited the reach of Olech in holding that Class of One cases cannot apply in the employment context, where government employers have discretion to make workplace decisions. Central to Engquist was governmental discretion. As the Second Circuit notes, "such state action does not violate the Equal Protection Clause 'when one person is treated differently from others, because treating like individuals differently is an accepted consequence of the discretion granted.' ... 'This principle applies most clearly in the employment context, for employment decisions are quite often subjective and individualized.'"

So, how far does Engquist go? Does it mean that no one can bring a Class of One case in challenging discretionary governmental decisionmaking? Some courts have read Engquist that way, sharply limiting the Class of One remedy, since so much governmental decisionmaking is discretionary. But the Second Circuit (Pooler, Calabresi and Chin) won't go that far. Class of One claims under Olech can challenge some discretionary acts. "We join the Seventh Circuit in holding that Engquist does not bar all class-of-one claims involving discretionary state action. While there may be some circumstances where Engquist is properly applied outside the employment context, the case before us is not one of them. Critically, the state defendants exercised the state's regulatory power," Judge Pooler writes.

Since the Supreme Court in Engquist said that there is a crucial difference "between the government exercising the power to regulate or license, as lawmaker, and the government acting as proprietor, to manage its internal operations," and the government has more leeway in dealing with employees than the citizens at large, the Second Circuit will not chop the head off Class of One claims that easily.

None of this helps the plaintiff in this case, however. The Lab cannot win because it cannot show that the government's investigatory practices were applied to the Lab differently from other laboratories, which were not comparable. There is no disparate treatment, which means that the Lab cannot bring a Class of One claim.

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