Basically Law

Read the opinion here.

Issue.  What standard of review should apply to all racial classifications whether "benign" or not?

Background.  Contractors with the federal government were given a financial incentive for subcontracting work to "socially and economically disadvantaged individuals."  The law assumed that "socially and economically disadvantaged individuals" included racial minorities (African-Americans, Latinos, Native Americans, Asian Americans, etc.)

In 1989, the Central Federal Lands Highway Division awarded a prime contract to Mountain Gravel and Construction Company.  Mountain General solicited bids for sub-contract work.  With respect to guardrail work, Mountain General selected Gonzales Construction Company even though it did not submit the lowest bid because it received money for selecting Gonzales Construction since it was certified as a "socially and economically disadvantaged individual."  The lowest bidder was Adarand Construction who Mountain General claimed would have been awarded the sub-contract had it not been for the financial rewards for selecting Gonzales.

Adarand sued and claimed that the law providing financial incentives violated the Equal Protection Clause and/or Due Process under the 5th Amendment.  The Court of Appeals rejected Adarand's claim but the Supreme Court reversed because the Court of Appeals applied the wrong standard of review.

Court's Analysis.  The Court recognized that it had not been consistent on which standard of review should be applied when there is a "benign" race based classification (affirmative action).  The Court intended to settle the issue once and for and all.  The Court held that "all racial classifications, imposed by whatever federal, state or local governmental action must be analyzed by a reviewing court under strict scrutiny."

Since a race based classification needs to be narrowly tailored to further a compelling state interest, it will allow for some permissible use of "benign" racial classifications.  Still, the principle remains that it should not matter what is the race of the victim as a result of a racial classification.  All individuals have the same protection under the Equal Protection Clause.

In this matter, the Court remanded the case to the District Court for further review to determine whether this complex regulatory scheme can withstand strict scrutiny and what aspect of the scheme required strict scrutiny review.  The Government claimed that the scheme providing economic incentives to hire "socially and economically disadvantaged individuals" is not a race-based classification, but the presumption that racial minorities fall within the category may be a race-based classification.  That is an issue for the District Court to determine on remand.