Featured Case

Contact:  Paul J. Beard II

Status: Favorable decision finding the congressional act unconstitutional on its face, federal government decides not to seek Supreme Court review.

Summary:
Under the National Defense Authorization Act, Congress has set a goal of awarding 5% of the total dollar amount of defense contracts to small businesses owned and controlled by "socially and economically" disadvantaged individuals. The Act assumes that blacks, Hispanics, Native Americans, and Asian- Pacific Americans are socially and economically disadvantaged. To reach its goal, Congress authorizes the Department of Defense to adjust bids submitted by nonsocially and economically disadvantaged firms upwards by 10%.

In 1998, Rothe Development Corporation bid for a defense contract and was the lowest bidder. However, because Rothe, a San Antonio-based company, is owned by a white female and therefore does not qualify for the preference, Rothe’s bid was adjusted upward by 10%. A company owned by an Asian-American qualified for the preference, became the "lowest" bidder, and was awarded the contract.

Rothe filed a lawsuit alleging that the preference violates the Equal Protection Clause. On November 4, 2008, after 10 years of repeated appeals, the Federal Circuit Court of Appeals court struck down the Defense Department’s racial quota program as a violation of the Equal Protection Clause of the Fourteenth Amendment. In February 2009, the U.S. Department of Justice and the Department of Defense indicated they would not seek Supreme Court review.