Dunnet Bay Construction Compan v. Erica J. Borggren
2015 U.S. App. LEXIS 14563
7th Cir.2015Background
- Dunnet Bay Construction sues IDOT and Secretary Hannig over IDOT's DBE program alleged to discriminate on race.
- District court granted summary judgment for defendants, finding Dunnet Bay lacked standing and that the DBE program withstands constitutional challenges.
- Dunnet Bay is a non-DBE, white-owned contractor with substantial annual revenue, bidding on federally funded IDOT projects.
- IDOT administers a DBE program with a statewide goal (22.77%) and contract-specific DBE goals; waivers and modifications are part of the process.
- Dunnet Bay contends it was harmed by off-list bidding, the DBE goal, and alleged pressures to increase DBE participation; it seeks damages and declaratory relief.
- The Eisenhower Expressway Contract No. 60I57 was central: Dunnet Bay bid low but failed to meet the DBE goal; IDOT rebid the contract after reconsideration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to challenge the DBE program | Dunnet Bay shows injury from equal treatment denial | Dunnet Bay lacks a concrete injury and cannot represent third parties | Dunnet Bay lacks Article III standing |
| Constitutional equal protection challenge to DBE program | DBE program discriminates based on race against non-minority contractors | Program serves compelling interest and is narrowly tailored under federal authority | Affirmed district court; no equal protection violation independently shown |
| Whether IDOT exceeded federal authority in implementing DBE goals | DBE goals/waivers function as quotas; exceeded authority | FHWA approval and regulatory framework authorize goals and procedures | IDOT did not exceed federal authority; regulations permit the approach used |
| Good faith efforts and reconsideration process under 49 C.F.R. § 26.53 | IDOT denied meaningful reconsideration and failed to assess good faith | IDOT properly considered good faith efforts; reconsideration justified | Grunloh's findings supported denial of Dunnet Bay's good faith efforts; reconsideration process not violative |
Key Cases Cited
- Associated Gen. Contractors of Am., Northeastern Fla. Chapter v. Jacksonville, 508 U.S. 656 (U.S. 1993) (standing to challenge set-aside programs; injury is denial of equal footing in bidding)
- Adarand Constructors, Inc. v. Pena, 515 U.S. 200 (U.S. 1995) (strict scrutiny for federal racial classifications; standing for forward-looking relief)
- Gratz v. Bollinger, 539 U.S. 244 (U.S. 2003) (forward-looking standing and race-based admissions policies; not binding here but cited for standing principles)
- City of Richmond v. J.A. Croson Co., 488 U.S. 469 (U.S. 1989) (quota-like DBE restrictions prohibited; strict scrutiny framework for race-based programs)
- Monterey Mechanical Co. v. Wilson, 125 F.3d 702 (9th Cir. 1997) (standing where injury includes competitive disadvantage due to race-based criteria; discussed in context of DBE)