Builders Flooring Connection, LLC v. Brown Chambless Architects, LLC, No. 2:11cv373MHT, 2014 WL 197679 (M.D. Ala. Jan.

16, 2014) In Builders Flooring Connection, LLC v. Brown Chambless Architects, LLC, the District Court for the Middle District of Alabama held that a state executive official was ipso facto entitled to Parker immunity from the plaintiffs antitrust claim. The Court therefore dismissed the plaintiffs antitrust claim, although it held that the state official was not entitled to Eleventh Amendment immunity or Alabama state-sovereign immunity from the plaintiffs state-law claim because the plaintiff had sued the defendant in her individual capacity. Although its opinion expressed sympathy for the plaintiffs attempt to overcome the immunity defense, the Court concluded that stare decisis required that the state executive official be afforded Parker immunity. The plaintiff, Builders Flooring, was a flooring contractor that had bid on contracts for flooring projects related to the renovation of facilities at Auburn University Montgomery (AUM), a public university. The defendants were Weiss Flooring, Inc. and its owner Robert Weiss, a competitor to the defendant, various architecture firms, and Wanda Blake, the vicechancellor of financial affairs for AUM. Blake provided the bid specifications for the projects. The plaintiff alleged that the defendants, including Blake, conspired to rig the bidding process for these projects in violation of 1 of the Sherman Act. The plaintiff also brought state-law claims for interference with business relations and misrepresentation based on the same conduct. Blake, the university vice-chancellor, moved to dismiss the antitrust claim against her, arguing that because she was acting as an officer of AUM, an arm of the State of Alabama, she was entitled to Parker doctrine immunity. Relying on Saenz v. Univ. Interscholastic League, 487 F.2d 1026, 1027 (5th Cir. 1973), Blake argued that Parker immunity is not limited to legislative bodies or agencies, but also extends to executive officers or agents of the State, and thus the plaintiffs allegation that Blake had personally conspired to rig the bidding process did not overcome her Parker immunity. The plaintiff countered that Saenz was no longer good law, because subsequent precedents established that only states legislatures and highest courts are ipso facto entitled to immunity, and that all other government officials or bodies must make an additional showing of clearly articulated and affirmatively expressed state policy to qualify for Parker immunity. The Court expressed sympathy for the plaintiffs argument, and identified three subsequent precedents supporting the plaintiffs position. First, the Court noted that the Supreme Court has only granted ipso facto state-action immunity where the challenged action was undertaken by the states legislature or highest court acting in a legislative capacity, citing Hoover v. Ronwin, 466 U.S. 558, 567-68 (1984). Second, where Parker immunity is asserted with respect to action taken by private parties, the Supreme Court required in F.T.C. v. Phoebe Putney Health Sys., Inc. both that the challenged restraint . . . be one clearly articulated and affirmatively expressed as state policy, and that the policy . . . be actively supervised by the State. 133 S. Ct. 1003, 1010 (2013). Third, the Court noted that sub-state governmental units, such as municipalities and counties, are not ipso facto entitled to Parker immunity, citing City of Columbia v. Omni Outdoor Adver., Inc., 499 U.S. 365, 370 (1991), and that such a governmental entity must establish that its conduct is directed by a clearly articulated and affirmatively expressed state

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policy in order to qualify for immunity. The Court also noted that the Supreme Court has never decided whether state executive branch officials or agencies are entitled to ipso facto immunity, and has also cautioned that Closer analysis is required when the activity at issue is not directly that of the legislature or supreme court, but is carried out by others pursuant to state authorization, citing Hoover, 466 U.S. at 568. Notwithstanding these precedents, the Court noted that every Court of Appeals to address the issue has held that state-level executive officials and agencies are ipso facto entitled to Parker immunity, citing Saenz, 487 F.2d at 1027; Neo Gen Screening, Inc. v. New England Newborn Screening Program, 187 F.3d 24, 29 (1st Cir.1999); Charley's Taxi Radio Dispatch Corp. v. SIDA of Hawaii, Inc., 810 F.2d 869, 876 (9th Cir.1987); and DeakPerera Hawaii, Inc. v. Dep't of Transp., 745 F.2d 1281, 1283 (9th Cir.1984). The Court concluded that because Saenz (which was decided while the Middle District of Alabama was still within the Fifth Circuit) was directly on point and had not been overruled by the Eleventh Circuit or the Supreme Court, it was bound to follow that decision. The cited cases that were in tension with Saenz had all been decided in different contexts involving assertion of immunity for either private individuals or sub-state entities, and thus could not have overruled Saenzs holding that state executive officials and agencies are entitled to ipso facto immunity. Although it dismissed the plaintiffs antitrust claim against Blake on the basis of Parker immunity, the Court upheld the plaintiffs state-law interference with business relations claim against Blakes asserted defenses of Eleventh Amendment and Alabama state-sovereign immunity, finding that these immunities were not applicable because the plaintiff had sued the defendant in her personal capacity and thus had not effectively brought suit against the State. The Court additionally noted that with respect to the Alabama sovereign immunity defense, the Alabama Supreme Court has recognized that claims against a state official in his or her personal capacity alleging that the official had acted fraudulently or in bad faith were not suits against the state and thus not barred by immunity.

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