| Cite as: 3 NW J. L. & Soc. Pol'y 131 at http://www.law.northwestern.edu/journals/njlsp/v3/n1/5 | NJLSP Home > Volume 3 > Issue 1 (Winter 2008) |
¶ 1 The Reconstruction period immediately following the Civil War was a trying time for our nation. The Confederate states paid a price for their secession, largely in lost political power. They were forced to submit to the will of the Union on issues such as the adoption of the Civil War Amendments. The white people of the South struggled to maintain their way of life; many joined the Ku Klux Klan, which used violent tactics to repress the newly freed slaves.1 In response to this threat, Congress passed the Ku Klux Klan Act, also known as the Civil Rights Act of 1871 (the 1871 Act). The 1871 Act aimed to thwart those who would deprive former slaves of their newly created federal rights.2
¶ 2 Section 2 of the 1871 Act comprised two provisions, one creating criminal penalties and the other establishing civil remedies for conspiracies to deprive others of their rights. In 1883, the Supreme Court struck down the criminal provision of section 2, holding it unconstitutional as applied to private entities3 (where state action is not alleged) because "the Fourteenth Amendment does not provide [Congress with] authority to proscribe exclusively private conspiracies."4 After this decision, the civil conspiracy provision of the 1871 Act "lay dormant for [70 years] since people simply assumed it was unconstitutional as well."5 The civil provision was revived in 1971, however, when the Supreme Court held private conspiracies actionable if they are motivated by a "class-based, invidiously discriminatory animus."6 A swarm of litigation followed, in which plaintiffs sought damages under the civil conspiracy section7 for injuries arising from rights deprivations by purely private entities. Many of the defendants in these cases were corporations.8
¶ 3 Most of the cases against corporate defendants could have been dismissed due to a lack of state action because the 1871 Act does not cover wholly private conspiracies.9 Despite this avenue for dismissal, a large number of cases were disposed of by resorting to a policy only recently introduced to civil rights law: the intracorporate conspiracy doctrine. The doctrine holds that agents and employees of a corporation are acting on its behalf when engaging in business decisions; thus, since a conspiracy requires "a meeting of the minds,"10 and since the acts of the separate people are attributed to the single corporate entity, there is but a single legal actor.11 No conspiracy can exist.
¶ 4 The intracorporate conspiracy doctrine was originally used in the field of antitrust law to shield a corporation from liability for its agents and officers "conspiring" to fix prices under section 1 of the Sherman Antitrust Act.12 In a seminal antitrust case, the Fifth Circuit Court of Appeals reasoned that since the agents all work for the same entity, they could hardly be accused of conspiring for debating their own pricing policy. Addressing the need for open policy discussions within corporate bodies, the court created the intracorporate conspiracy doctrine by holding that the agents and officers of a corporation cannot be said to conspire under section 1 of the Sherman Act.13 While the court never used the term "intracorporate," it recognized that a basic requirement in conspiracy law is "two [or more] persons or entities" and that "[a] corporation cannot conspire with itself any more than a private individual can."14 The intracorporate conspiracy doctrine's extension to the civil rights context has been heavily criticized in law review literature15 because, when applied to agents of municipal entities, the doctrine immunizes such agents from liability for discriminatory conspiracies aimed at depriving others of their constitutional rights.16
¶ 5 Little attention, however, has been paid to the culprit behind the doctrine: the corporate entity itself.17 This artificial "person" serves an important purpose: it allows us to attribute the actions of the officers and agents of a corporation to the single corporate entity.18 The corporate entity also enables the bedrock principle of corporate law: limited liability.19
¶ 6 In the early days of corporate law, a common law doctrine evolved to combat abuse of the corporate entity. This doctrine allowed plaintiffs to hold shareholders directly liable for the actions of the corporation where it was shown that the corporate entity was used for unjust ends. Since it directs courts to disregard the corporate entity, legal scholars have long referred to the doctrine as "piercing the corporate veil."20
¶ 7 This Comment contends that the intracorporate conspiracy doctrine should never have been applied in the civil rights arena in light of the tenets of the veil-piercing doctrine, which holds that the corporate entity should be disregarded when it is abused or asserted for unjust ends.21 Consequently, this Comment argues that no justification exists for extending the doctrine to agents of municipal corporate entities, who were, in fact, one of the intended targets of the 1871 Act. In most civil rights cases where the intracorporate conspiracy doctrine is now applied, the municipal corporate entity is asserted to shield its agents from liability for alleged conspiracies aimed at depriving plaintiffs of their rights.22 The entity is thus asserted for the unjust end of negating liability before a court can even hear the facts of a case. The veil-piercing doctrine should negate the intracorporate conspiracy doctrine with regard to civil rights claims because Congress never intended to allow an intracorporate exception to the 1871 Act.23
¶ 8 Part II of this Comment examines the history of civil rights conspiracy law, including the impetus for the Civil Rights Act of 1871 and the case law that has engendered this imbroglio.24 Part III outlines the concept of the artificial corporate entity.25 Part IV describes the intracorporate conspiracy doctrine, beginning with its origins in antitrust law and continuing to its improper application to corporations under civil rights conspiracy claims.26 Part IV then notes the doctrine's exceptions and subsequent extension to municipal corporate entities.27 Lastly, Part IV discusses a trend among the district courts of applying the intracorporate conspiracy doctrine to claims under 42 U.S.C. § 1983.28 Part V explains the doctrine known as "piercing the corporate veil" and analyzes its general premise: disregarding the corporate entity in order to uphold public policy and achieve justice.29 Part VI then notes the dissonance between the veil-piercing doctrine and the intracorporate conspiracy doctrine and argues that Congress did not contemplate the latter in passing the 1871 Act because such an exception would negate its purpose.30 Finally, Part VI suggests that the intracorporate conspiracy doctrine is inconsistent with civil rights law and ends by proposing a limited standard by which courts might apply the intracorporate exception in civil rights cases to ensure that its reach is not broader than Congress intended.31
¶ 9 In the South, the end of the Civil War gave rise to an equally tumultuous era, especially for former slaves.32 While many white Southerners were willing to acquiesce33 to the passage of the Thirteenth,34 Fourteenth35 and Fifteenth Amendments,36 they were determined "to define in their own way the meaning of freedom."37
¶ 10 In 1866, six white men established the Ku Klux Klan (Klan); although its founders claimed the group was for their own amusement and "purely social,"38 it became much more. The Klan transitioned "from pranks to systematic brutality by 1867 [and] members routinely resorted to violence."39 While it had no organized structure, the Klan and kindred organizations were "deeply entrenched in nearly every Southern State" by 1870.40 As the Klan's message of white supremacy spread across the South, its membership escalated to immense proportions.41
¶ 11 The Klan became one of the nation's earliest terrorist groups42 by engaging in brutal acts of violence in order to intimidate its victims into submission.43 Ruling by fear, the Klan assaulted and murdered blacks and anyone who supported their freedom;44 the Klan ultimately "aimed to regulate blacks' 'status in society.'"45 Despite the patent illegality of their actions, Klan members were rarely subject to criminal prosecution.46 Not only was the public unwilling to cooperate with authorities, but local authorities were often members of the Klan themselves.47 Given this backdrop of lawlessness, Congress decided to take action.48
¶ 12 In response to the Klan's riotous tactics, Congress passed the 1871 Act, commonly known as the Ku Klux Klan Act.49 Section 1 of the 1871 Act is now codified at 42 U.S.C. § 198350 and section 2 is codified at 42 U.S.C. § 1985.51 Section 2 created criminal penalties and provided civil remedies against conspiracies to: (1) prevent public officials from performing their duties; (2) obstruct justice; or (3) deprive "any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws."52
¶ 13 The 1871 Act did not go unchallenged for long. In 1883, the Supreme Court struck down the criminal provisions, holding them unconstitutional in United States v. Harris.53 After conceding that Congress had the authority to enforce the Fourteenth Amendment through appropriate legislation, the Court held that Congress exceeded its authority in proscribing private conspiracies since the Fourteenth Amendment protects only against state action.54 While the civil provision remained, it fell into virtual disuse because it, too, was presumed to be constitutionally deficient.55 Thus, the Supreme Court did not hear a case arising under the civil provision until 1951. There, the Court expressly held that successful claims under § 1985 require a showing of state action.56 The civil provision was thereafter considered devoid of practical purpose because "few if any plaintiffs can allege or prove [a state action] causal chain."57
¶ 14 In 1971, the Court in Griffin v. Breckenridge revived civil rights conspiracy jurisprudence when it broadly declared private conspiracies actionable. When presented with Griffin's facts, the Court found Collins v. Hardyman unduly restrictive58 because some federal rights are protected from private infringement.
¶ 15 The plaintiffs in Griffin—black citizens—were driving along the highway in Mississippi when they were stopped by the white defendants, who assaulted the plaintiffs, held them at gunpoint and threatened to kill them.59 The plaintiffs sued, claiming the defendants deprived them of the right to be free from "the badges and incidents of slavery" and of the right to interstate travel.60 Believing this was just the type of conduct the 1871 Act intended to prohibit, the Court overruled Collins and held that § 1985(3) can reach private action.61 However, to allay fears that it would be interpreted "as a general federal tort law," the Court held that the section's use of the term "equal protection" requires that the conspiracy be motivated by "some racial, or perhaps otherwise class-based, invidiously discriminatory animus."62
¶ 16 In concluding that the private conduct was actionable, the Court noted that the plaintiffs' deprived rights—the right to be free from the "badges and incidents of slavery" and the right to interstate travel—are protected against private infringement as a "privilege[] of national citizenship" and by the Thirteenth Amendment, respectively.63 Thus, while the Court stated that its inquiry must simply identify "a source of congressional power to reach the private conspiracy alleged by the complaint,"64 it did not expressly hold that the deprived rights' protection against private infringement is essential for recovery. Thus, Griffin incorrectly led many to believe that § 1985 covered all forms of purely private conduct.65 After Griffin, numerous lawsuits were brought against corporations under § 1985 in which no state action was alleged. While these cases had no merit and should have been dismissed for want of state action, inventive lawyers successfully asserted intracorporate immunity instead.66
¶ 17 While Griffin expanded § 1985 to include private conduct, the Court gradually limited the section's scope over the next few decades. After Griffin, the Court considered § 1985 in a 1979 case where the plaintiff claimed to have been deprived of rights created by Title VII of the Civil Rights Act of 1964 (Title VII).67 Here, the Court held that § 1985 could not be used to vindicate rights found in Title VII, for allowing plaintiffs to do so would alter the "short and precise time limitations of Title VII."68 This might allow plaintiffs to "completely bypass the administrative process, which plays such a crucial role in the scheme established by Congress."69
¶ 18 In 1983, the Court considered the section's applicability to a conspiracy by union members to deprive non-members of their freedom of association.70 The Court held such a conspiracy is not actionable under § 1985 because a deprivation of First Amendment rights can only be accomplished through state action.71 This holding demonstrates that § 1985 was never meant to reach all forms of private conspiracy. Recovery under the section for private conspiracies depends on the nature of the underlying deprived rights: if the right is constitutionally protected from infringement by private actors, then the private conspiracy is actionable.72 If the right is only protected against state infringement, such as the freedoms of speech and religion or equal protection rights, then private conspiracies are not actionable since Congress lacks the authority to pass such broad legislation.73 Section 1985's basis in the Fourteenth Amendment74 supports the notion that the conduct it covers is generally state-sponsored.75 This state action requirement allows us to frame the dispute; this Comment argues against applying the intracorporate conspiracy doctrine to claims under § 1985 and to conspiracy claims under § 1983.76 Claims under § 1983 require action "under color of [law],"77 while claims under § 1985, as we have just seen, require state action unless the underlying deprived right is protected against private conduct. In passing the 1871 Act, Congress aimed to prevent the Klan's conspiratorial deprivations in any way possible. In Part VI, I argue that one of the Klan's most effective tactics was using the power of the state to deprive freedmen of their rights by obstruction of justice or simple inaction by Klan members and sympathizers who held state office; thus, applying the intracorporate conspiracy doctrine in cases under these sections will prevent claims Congress intended to permit against defendants who conspired to abuse their state power.78
¶ 19 The Court affirmed this interpretation of the section's coverage in its most recent § 1985 case.79 The plaintiffs in that case were abortion clinics and "organizations that support legalized abortion," who sued to enjoin the defendants—members of Operation Rescue who organized antiabortion protests—from "trespass[ing] on, and obstruct[ing] general access to, the premises of abortion clinics."80 While the claim failed for lack of state action,81 the Court held that "women seeking abortion" are not a protected class under § 1985.82 Before discussing the intracorporate conspiracy doctrine, it is prudent to summarize the doctrine's basis: the nature of the corporate entity.
¶ 20 The traditional theory of corporate law holds "that a corporation is a fictitious, artificial, legal person or juristic entity created by proper authority."83 This statement should be broken down for the sake of understanding.
¶ 21 For the basics of corporate personality, I rely on Arthur Machen's 1911 article of the same name84 because it is one of the earliest "influential" treatises arguing that corporate entities are real and not fictions.85 The first premise of corporate personality is "that a corporation is an entity distinct from the sum of the members that compose it."86 The second premise is "that this entity is a person."87 Machen, however, concludes that "the essence of juristic personality does not lie in the possession of rights but in subjection to liabilities."88 This is true because the law can only enforce or protect rights by punishing the "person" who violates those rights—"an idle proceeding unless the violator is a moral being capable of being deterred by the threat of punishment."89
¶ 22 For this reason, Machen argues that society regards the corporate entity "as having rights and liabilities for the sake of convenience; but . . . men of flesh and blood [must] bear the burdens attributed by the law to the corporate entity."90 Thus, Machen concludes that corporate personhood—the idea of the corporation as comparable to a real person—"is either a mere metaphor or is a fiction of law."91 Machen later notes that this "fiction" of corporate personhood also applies to the state as a municipal corporation.92
¶ 23 It is important, then, to distinguish between the corporate entity and the corporate "person"—the former being real, while the latter is "fictitious" or, more aptly, artificial.93 There is a danger, however, in writing off the corporate entity as a mere fiction because it serves the essential purpose of separating the corporate investors from their investment.94 This separateness allows the doctrine of limited liability—the fundamental principle of modern corporate law95—to protect investors from the corporation's liabilities.96 In the case of municipal corporations, the entity allows states to act on its citizens' behalf by isolating and delegating state functions to the appropriate departments and agencies. In addition, the municipal entity is currently used to immunize conspirators from liability for civil rights deprivations.
¶ 24 The intracorporate conspiracy doctrine emerged in 1952 in Nelson Radio & Supply Co. v. Motorola, Inc.,97 a case brought under section 1 of the Sherman Antitrust Act.98 The complaint alleged that Motorola coerced the plaintiff into an exclusive franchise agreement by which the plaintiff could no longer sell products made by Motorola's competitors.99 The Fifth Circuit Court of Appeals held that there could be no conspiracy because the defendant was a corporation and could only act through its agents (whose acts are attributed to the corporation itself).100
¶ 25 The Supreme Court endorsed the Fifth Circuit's Nelson Radio holding in Copperweld Corp. v. Independence Tube Corp., noting that an internal agreement among firm members to implement the firm's policy "does not raise the antitrust dangers that § 1 was designed to police."101 The intracorporate conspiracy doctrine is thus settled law in the antitrust field. However, this holding does not implicate the doctrine's applicability to civil rights cases because it was limited to section 1 of the Sherman Act. Even by analogy, this holding cannot affect the doctrine's applicability to civil rights cases because agreements among municipal agents to deprive citizens of their legal rights were, I argue, exactly the type of "dangers that [the 1871 Act] was designed to police."102
¶ 26 Dombrowski v. Dowling introduced the intracorporate conspiracy doctrine to the civil rights arena.103 Dombrowski was a white criminal lawyer who sought to rent office space from the corporate defendant and its agent, Jack Dowling. According to Dombrowski, when Dowling learned that "a substantial number of [Dombrowski's] clients were of the Black race or of Latin origin," Dowling ended the negotiations and refused to rent the office to Dombrowski.104 On appeal, the Seventh Circuit held private conspiracies are not actionable under § 1985 if the underlying right stems from section 1 of the Fourteenth Amendment because that section only protects against state action.105 The court continued, however, noting in dicta that the existence of a conspiracy cannot be "satisfied by proof that a discriminatory business decision reflects the collective judgment of two or more executives of the same firm."106
¶ 27 Many courts found this language irresistible. Over the next decade, the majority of § 1985 lawsuits that complained of conduct by purely private actors107 were promptly dismissed under the intracorporate conspiracy doctrine.108 The circuits are now split on whether the doctrine should be applied to civil rights cases: the majority of circuits—the Second, Fourth, Fifth, Sixth, Seventh, Eighth, and Eleventh—have applied the doctrine, whereas the First and Third Circuits have rejected it.109 The Supreme Court has not yet resolved the split.110 In side-stepping the doctrine, the First and Third Circuits factually distinguished their cases from those of the majority, paving the way for other courts—even courts in the majority—to find exceptions to the doctrine in the civil rights context.
¶ 28 Many courts have been reluctant to uphold the doctrine in circumstances that call to mind Congress's intent in passing the 1871 Act. Their reluctance derives from the indiscriminate reach of the intracorporate exception to civil conspiracies. The doctrine broadly dismisses lawsuits even in cases where such dismissal contradicts the intentions of the 1871 Act. As a result, courts have created exceptions to the doctrine where justice requires.
¶ 29 One exception to the doctrine originated from the "single act of discrimination" dictum in Dombrowski.111 Courts applying this exception have found that a series of acts or instances of discrimination can negate the doctrine because the existence of persistent, recurring discrimination is strong evidence that the defendants conspired.112 Courts also allow an exception where the conduct alleged is criminal because the "fiction of [the] corporate entity [has] never been applied as a shield against criminal prosecutions."113
¶ 30 Another exception arose in cases where plaintiffs alleged police misconduct.114 This exception may stem from Seventh Circuit Court of Appeals cases in which the court found police officers liable for conspiracy without ever mentioning the intracorporate conspiracy doctrine.115 The exception—limited to police officers—is based on the idea that police misconduct is an abuse of power that occurs outside the scope of employment.116 This is an extension of the argument that the intracorporate conspiracy doctrine is meant to shield corporate employees for "routine, collaborative business decisions."117 Where courts find a police action causing a plaintiff's injury was not routine, the action is held to be outside the scope of employment and, thus, within a doctrinal exception, rendering the plaintiff's claim actionable.118
¶ 31 Some courts have found doctrinal immunity by holding the wrongful act outside the scope of employment when personal reasons motivated the agents. One such exception occurs when the agents have "an independent personal stake in achieving" the illicit objective.119 This exception stems from dicta in Nelson Radio, where the court noted the plaintiff did not allege that the agents "were actuated by any motives personal to themselves."120 The court intimated that if the plaintiff had joined the alleged conspirators as defendants in the lawsuit and alleged that those defendants did not act "only for the defendant corporation," it might have ruled otherwise.121
¶ 32 In Hartman v. Board of Trustees of Community College District Number 508, the plaintiff asserted that the doctrine did not apply because the conspirators acted with "personal racial animus" and, therefore, had independent stakes in the conspiracy's objective.122 The court noted the similarity between "personal racial animus," the "independent personal stake" exception, and the "invidiously discriminatory animus" required in Griffin.123 The Hartman court found that allowing a "personal racial animus" to negate the doctrine would permit the exception to swallow the rule; thus, the court concluded that the "personal stake" exception applies only where the agents acted solely because of personal bias or motive.124 Other courts have similarly limited the exception.125
¶ 33 By the mid-1980s, many courts extended the intracorporate conspiracy doctrine to cover the acts of agents of municipal entities. The extension was prompted by the similarities between public and private educational institutions. In Cole v. University of Hartford, a Connecticut district court found that the intracorporate conspiracy doctrine applied to agents of a private university, shielding them from liability.126 A year later, a Louisiana district court, citing Cole, extended the doctrine in a case against the University of New Orleans.127 Within a few years, a Connecticut district court extended the doctrine to agents of the state's university.128 By the mid-1980s, district courts regularly applied the doctrine to bar § 1985 claims against agents of public entities.129
¶ 34 In 1991, the Sixth Circuit Court of Appeals heard a § 1985 case against members of a board of education.130 Citing its own precedent and the Second Circuit's application of the doctrine to "an educational corporation" in Herrmann v. Moore,131 the court found that the doctrine barred the plaintiff's claim.132 Soon after, the Supreme Court denied the plaintiff's petition for certiorari on the issue of the doctrine's applicability to § 1985(3) claims.133
¶ 35 Finally, in 1994, the Seventh Circuit Court of Appeals, which introduced the doctrine to the civil rights arena, held explicitly that the doctrine applies to municipal agencies.134 Such agencies, the court noted, "are functionally the equivalent of corporations in that their employees and officers jointly endeavor to provide a product or service and reach decisions pursuant to a unified, hierarchical structure."135 In Part VI, I argue that Congress's intent in passing the 1871 Act was to put a stop to all rights deprivations and that the intended targets of the Act therefore included not only Klan members acting as private citizens but also agents of municipal entities, who are in a unique position to deprive others of their rights due to the state power they wield. Thus, if municipal agencies are indistinguishable from corporate entities based on hierarchical structures and joint endeavors, any argument that would negate the doctrine's applicability to agents and officers of corporate defendants in the civil rights arena would surely negate its applicability to agents of municipal entities.136
¶ 36 A number of district courts have extended the doctrine to negate conspiracy claims under 42 U.S.C. § 1983.137 The trend is unsettling because the purpose of § 1983 is to curb abuses of power perpetrated by those with state authority.138 Section 1983 conspiracy claims cover a broader scope of conduct than those under § 1985 because plaintiffs need not establish class-based discrimination.139 Extending the doctrine to § 1983 thus allows those with state power to freely conspire to deprive others of their rights. Disturbingly, courts may have extended the doctrine in this way due to a simple typographical error.
¶ 37 Several district courts have stated that, in Buschi v. Kirven,140 the Fourth Circuit Court of Appeals applied the doctrine to bar a § 1983 conspiracy claim.141 Though the Fourth Circuit examined the doctrine's applicability in Buschi, it did so while explaining the court's holding below, in which the district court dismissed specific defendants from the lawsuit.142 In its analysis, the court stated that another case "held that 'unauthorized acts [of employees] in furtherance of a conspiracy may state a claim under § 1983(3).'"143 This is clearly incorrect because § 1983(3) does not exist: § 1983 has no sub-sections.144 The court must have intended to write "§ 1985(3)" as that is the only section that expressly involves civil rights conspiracies. A cursory glance at the quoted case verifies that the error is indeed typographical.145 Even so, § 1983 conspiracy claims may now be barred by the doctrine. While it may seem logical to extend the doctrine from § 1985 to § 1983 given that both sections originated in the 1871 Act, I argue that the doctrine should generally not apply to claims under either section. I turn now to the piercing the corporate veil doctrine to assess its congruence with the intracorporate conspiracy doctrine.
¶ 38 The concept of shielding constituents behind their shared entity is not unique to the intracorporate conspiracy doctrine. Limited liability is the basis of the corporate form; it allows us to conduct business effectively in the modern world. While incorporating "for the purpose of achieving limited liability" is permitted,146 shareholders can abuse the corporate form and hide behind the corporate liability shield where, for example, they use the corporation for illegitimate purposes.147 In such cases, courts will disregard the corporate entity—and, thus, the notion of limited liability—in the name of equity. In deference to the idea of disregarding the artificial corporate entity, legal scholars have long referred to this doctrine as "piercing the corporate veil."148
¶ 39 The doctrine is problematic, however, because limited liability is the "traditional cornerstone" of corporate law.149 Courts are reluctant to pierce the veil because doing so forces a shareholder to suffer a liability greater than his or her original investment. Despite this reluctance, courts have held that piercing is appropriate in "egregious circumstances."150 However, between courts' difficulty discerning such circumstances and their reluctance to enforce liabilities beyond a shareholder's original investment, the veil-piercing doctrine has been applied inconsistently.151 However, the general concept of the doctrine—the disregard of the corporate entity—is entirely consistent with its premise: to uphold considerations of public policy and equity against the liability shield provided by the artificial corporate entity.
¶ 40 The general rule of the doctrine can be found in United States v. Milwaukee Refrigerator Transit Co., where the court held:
[A] corporation will be looked upon as a legal entity as a general rule . . . but when the notion of legal entity is used to defeat public convenience, justify wrong, protect fraud, or defend crime, the law will regard the corporation as an association of persons.152
¶ 41 One treatise explains that the veil should be pierced where the corporate form is "used to accomplish an improper or unlawful purpose."153 Further, the veil is commonly pierced to prevent "the unjust raising of a defense."154 Finally, when individuals use the corporate entity "to shield personal wrongdoings, the court must look to substance rather than to form."155 Given this background in the veil-piercing doctrine, I now examine how the doctrines conflict.
¶ 42 The general public policy of the United States is set by Congress through its power to legislate.156 In 1871, Congress decided that civil conspiracies to deprive another of her rights are against public policy; the 1871 Act thus provided a remedy to victims of such conspiracies.157 Conspiracies actuated through state action are now covered by §§ 1983 and 1985.
¶ 43 In a classic veil-piercing case, then-Judge Cardozo wrote: "The logical consistency of a juridical conception will indeed be sacrificed" when necessary to uphold or defend an accepted public policy.158 In the civil rights field, the rights of individuals have been sacrificed to uphold the notion that agents of a principal corporate entity cannot conspire.159 This trend thwarts Congress's intent in passing the 1871 Act.
¶ 44 In drafting the 1871 Act, Congress sought to enforce the Due Process and Equal Protection clauses of the Fourteenth Amendment,160 the fundamental principle of which was to guard against abuses of state power.161 The state can only act through its human agents,162 who are subject to the same whims and biases as all humans. Thus, these clauses afford protection against the reality that agents of the state will, at times, use state authority to further personal biases—whether against a class of people or a single individual. When such a biased decision is jointly made with the intention of depriving a person of her constitutional rights, the 1871 Act provides a remedy.163 While the conspiracy sections of the 1871 Act were partially intended to restrain the private conduct of those who would deny blacks their rights to life, liberty and property,164 I believe the provisions were also meant to curb conspiratorial abuses of power by state actors who sympathized with the Klan's ideology.165
¶ 45 There is little debate that the Klan's purposes were almost entirely political.166 "[President] Grant wrote that the Klan aimed 'by force and terror to prevent all political action not in accord with the view of the members[ and] to deprive colored citizens of the right to bear arms and of the right to a free ballot.'"167 Thus, in the Klan's view, the newly freed slaves did not deserve the rights bestowed upon them by the Thirteenth, Fourteenth, and Fifteenth Amendments.168
¶ 46 Given this belief, Klan members and sympathizers169 sought to deny blacks the rights enjoyed by whites.170 A former member admitted that the Klan hoped to "gain[] control of the outcome of elections."171 The group's political objectives were clear: amass state and federal power in Klan members and sympathizers, who would use government power to restore white supremacy.172
¶ 47 Klan members and sympathizers violated the Fourteenth Amendment by infiltrating the government to instill their unconstitutional racism into state agendas. More importantly, local government infiltrators who sympathized with the Klan—such as judges, sheriffs, and police deputies—could readily deny others their rights, such as the right to a fair trial, the right to be free from unreasonable searches and seizures, and the right to bear arms.173 Where multiple sympathizers or members worked on behalf of one state entity, their mutual plans to deprive others of their federal rights on account of race or party affiliation were undeniably contrary to the Equal Protection clause. Therefore, Congress enacted section 2 of the 1871 Act to both protect Klan victims from violence and provide a remedy for victims of unconstitutional rights deprivations achieved through conspiracies by agents of state entities.
¶ 48 State infiltration by members or supporters of the Klan is not as far-fetched as it may seem. Reconstruction-era South Carolina provides a prime example of state infiltration by Klan members. In one county, the "chief of the Klan [was a] member of the Legislature."174 Others identified as active Klan members included the county sheriff and a former magistrate.175 Among those with substantial state power—and a kind ear bent toward Klan objectives—were "several of the key leaders of the [South Carolina] Democratic party [who] refused to use their influence to suppress the violence."176 This may explain why the state government's response "to the resurgence of the Klan in 1870-71 was largely one of inaction and vacillation."177 The Klan's goals and methods were no different in other Southern states.178
¶ 49 Besides its obvious aim of preventing the Klan's private conspiracies, the 1871 Act sought to limit joint abuses of power by those with state authority. The plain language of the 1871 Act supports this interpretation: under § 1985, the only express civil rights conspiracy section, conspiracy victims may sue "any one or more of the conspirators"—no exceptions are listed. 179
¶ 50 As one writer noted before the intracorporate conspiracy doctrine was commonly extended to agents of state entities, "When state officials are involved, the conspiracy necessarily will affect the ability or willingness of the authorities to accord equal protection of the laws."180 Thus, the commentator concluded, in cases "involving state officials as conspirators, [section 1985] is little different from section 1983."181 This view accords with the canon of construction in pari materia, which provides that §§ 1983 and 1985 should be interpreted similarly.182
¶ 51 In addition, the legislative history of the 1871 Act evinces Congress's concern that "state instrumentalities could not protect [federally created] rights" and "that state officers might [be unsympathetic] to the vindication of those rights."183 Representative Stevenson of Ohio noted the common belief that Klan members used their political influence to infiltrate state governments as "officers of the law."184 Further, Ohio Representative Perry "referred to state authorities [acting] 'in complicity with' the conspirators."185 While no one can know the extent to which the secrecy-driven Klan infiltrated state governments, we know Congress was aware of and sought to remedy conspiratorial deprivations of rights caused by state actors when passing the 1871 Act. Thus, in the case of civil rights conspiracies, the liability shield provided by the municipal entity should be sacrificed to uphold the wishes of Congress.
¶ 52 Furthermore, courts should not be reluctant to "pierce the corporate veil" in such cases because doing so would not require courts to expose shareholders to liability beyond their original investment. Since the defendants in §§ 1983 and 1985 conspiracy cases are agents of municipal corporate entities, the concept of limited liability does not apply.186 Thus, courts are not forced to repudiate the most basic doctrine of corporate law in refusing to acknowledge the municipal corporate veil.187 As such, the corporate law considerations that made courts reluctant to disregard the corporate entity simply do not apply to civil rights conspiracies perpetrated through municipal corporations.
¶ 53 It is again worthwhile to note that civil rights conspiracy litigation was virtually non-existent until 1971, when the Supreme Court extended § 1985(3) to private action.188 However, due to the misconception that § 1985 covered all types of private conspiratorial deprivations rather than just those protected against private infringement, there were numerous suits brought against corporate defendants in which the intracorporate conspiracy doctrine was used to preclude liability.189 By the mid-1980s, courts extended the doctrine to municipal corporations without fully considering the implications of precluding liability for state actors engaged in conspiracies to abuse their power.190
¶ 54 Veil-piercing does not apply to municipal entities because they have no stockholders upon whom to impose liability. But the tenets of the veil-piercing doctrine should have been considered when private corporate agents asserted that their conspiratorial liability was precluded by the existence of the corporate entity.191 Since recognizing the corporate entity for that purpose would allow an unjust result—immunizing from liability agents who conspire to deprive people of their rights—courts should have pierced the veil and disregarded the entity to reach the facts behind the rights deprivation. Municipal corporate agents with state authority are better able to deprive people of rights than private corporate agents, so the unjust result borders on the absurd. By applying the intracorporate conspiracy doctrine in the field of civil rights, courts effectively immunized the 1871 Act's most pertinent contemporary conspiracy defendants based on adventitious precedent.192
¶ 55 In Travis v. Gary Community Mental Health Center, Inc., the court upheld the intracorporate conspiracy doctrine by asserting that in 1871, "it was understood that corporate employees acting to pursue the business of the firm could not be treated as conspirators."193 To support this claim, the court cited Trustees of Dartmouth College v. Woodward194 and Fletcher's Law of Corporations.195 Neither of these sources, however, asserts anything of this nature.196 In fact, Fletcher notes that corporations may be liable for civil conspiracy where agents conspire to "commit wrongs against another for the benefit of the corporation."197 Further, in the past, judges and commentators were hesitant to support the asserting of the corporate form as a defense.198 Machen noted the "unfortunate tendency to regard the corporate fiction as a touchstone to be applied to all questions connected with corporations."199
¶ 56 The Travis court then addressed Dombrowski's dictum200 that the "Klan could not avoid liability by incorporating . . . because the Klan meddled in the business of others."201 This very statement militates against applying the doctrine. The court reasoned that by incorporating, the Klan would still attempt to achieve its aims through "multiple centers of social or economic influence."202 However, the court overlooked that the Klan's paramount objectives were political203 and that it therefore sought to achieve its goals through infiltrating governments.204 Indeed, the Klan attempted to meddle in the business of the state in order to achieve its goal of restoring white supremacy. Today, government officers meddle in state affairs when they wield their state authority in conspiring to deprive others—typically their subordinate employees—of their rights.205 It is fortunate that the modern version of the 1871 Act exists to remedy such abuses of authority.
¶ 57 After holding that the doctrine barred a plaintiff's claim, one court suggested that the plaintiff "can still assert direct Section 1983 claims against [every agent] who participated in the deprivation in his or her individual capacity."206 The court did not substantiate this proposition, however, because it is shortsighted. The purpose of conspiratorial liability in tort law is to expand both the scope of defendants and the scope of conduct by "rendering liable those persons who support [or formulate] unlawful conduct, but do not play an active role in its accomplishment."207 Thus, conspiratorial liability allows plaintiffs to sue defendants who actively achieve the rights deprivations and all those who either supported or devised the deprivation because the act of conspiring is thought to be "a special evil to society" and, as such, deserves special recognition.208
¶ 58 One commentator argues that the doctrine should apply if the agents' actions "are traditionally attributed to the entity."209 The consequences of such a proposal are disturbing. Not only does it turn a blind eye to the abuse of state power, it negates Congress's intent to ensure that state actors comply with the Equal Protection Clause. The question cannot fall upon the traditional attributions of the act because the act furthering the conspiracy cannot be achieved without abusing state power.210 The rule that should govern in these cases was well stated by the Supreme Court in United States . v. Classic: "Misuse of power, possessed by virtue of state law and made possible only because the wrongdoer is clothed with [state] authority . . . is action taken 'under color of'" state law.211 The question is whether the municipal agents' acts should be attributed to their principal entity; the determination should be based on the factors taken into account when the decision to act was made.212 The illustrative cases below exemplify the conspiracies Congress intended to remedy with the 1871 Act.
¶ 59 A perfect example of how the doctrine is used unjustly to shield conspirators from § 1985 liability arises in Dickerson v. Alachua County Commission.213 In March 1994, Alfred Dickerson, an African-American corrections officer at the county jail, was on-duty shift supervisor when a prisoner's escape was discovered; it is undisputed that the escape actually occurred the previous night, when Dickerson was not on duty.214 Charles King, William Krider, and Gary Brown began an investigation.215 According to Dickerson, "conflicts of interest should have precluded [King and Krider] from participating in the investigation [since] Krider knew about [the] escape plan in advance and failed to file an incident report."216 Despite the officers' dubious motives, they found that the jail broke a rule about the "posting [of] uncertified officers alone in housing units where inmates are confined."217 However, the report "only cited the jail for violations of the rule that occurred during Shift I—the shift supervised by Dickerson—not during Shift III, when the escape actually occurred."218 The investigation found no violations before or during the escape and concluded that Dickerson and his minority subordinates were entirely at fault.219 He and three subordinates were demoted promptly; the white officers on duty at the time of the escape "received only written warnings."220
¶ 60 Dickerson sued, alleging that "Caucasian jail officers and managers, including Brown, King and Krider" conspired to blame him and his minority subordinates for the escape, which in fact occurred because of the negligence of the alleged conspirators.221 A jury found the defendants liable under § 1985 for conspiring to deprive the plaintiff of due process and equal protection and awarded Dickerson $50,000; the Eleventh Circuit vacated the judgment, however, holding that the intracorporate conspiracy doctrine precluded the § 1985 conspiracy claim.222 The court reasoned that since Dickerson failed to include any defendants who were not county employees, all the defendants were acting under a single legal entity and were thus incapable of conspiring.223
¶ 61 The court also found that the doctrine's exceptions were inapplicable.224 Despite the fact that the investigating officers had "independent personal stakes" in shifting the responsibility from themselves to Dickerson and his subordinates, the court noted without explanation that this exception did not apply.225 Thus, the doctrine barred a claim Congress intended to permit.
¶ 62 Shaw v. Klinkhamer illustrates how the doctrine can be used to unjustly shield conspirators from liability in conspiracy claims under § 1983.226 In 1991, Susan Klinkhamer, mayor of St. Charles, Illinois, appointed Donald Shaw to chief of police; as chief, Shaw worked under Klinkhamer and her aide, Maholland.227
¶ 63 In the summer of 2002, one of Klinkhamer's major campaign donors received a speeding citation.228 When she heard of the citation, Klinkhamer called Shaw, "telling him that she 'didn't like it' and that she wanted him to 'pull it.'"229 After the citation was nullified without the issuing officer's permission, Shaw launched an investigation of the unauthorized disposition of the citation on January 8, 2003.230 He informed the state police of his suspicions on February 3, requesting an official inquiry and later disclosed that he suspected political influence.231 By February 18, Maholland informed Shaw that he would not be reappointed."232
¶ 64 Shaw brought a conspiracy claim under § 1983, alleging that Maholland and Klinkhamer conspired not to reappoint him "in retaliation for Shaw's having launched an investigation into the resolution of the [campaign donor's] traffic citation and having reported perceived acts of favoritism."233 The court held that Shaw's claim failed because it was not clear that the "decision not to reappoint Shaw was [made] solely for personal reasons."234 Again, the doctrine barred a claim Congress intended to allow.
¶ 65 In recent times, the most notable case to evoke application of the intracorporate conspiracy doctrine is Wilson v. Libby, Rove & Cheney.235 On July 6, 2003, Joseph Wilson IV, a former ambassador, published an op-ed in the New York Times236 in which he refuted President Bush's primary rationale for invading Iraq.237 Wilson went to Niger on behalf of the CIA to investigate the rationale and found it implausible.238
¶ 66 At the time, Wilson's wife, Valerie Plame, was a covert CIA operative.239 In an endeavor to discredit Wilson, White House officials—including Vice President Dick Cheney, his Chief of Staff, I. Lewis "Scooter" Libby and Karl Rove—allegedly conspired to leak Plame's name to the press,240 asserting that Plame's status at the CIA allowed her to arrange Wilson's trip to Niger.241 However, by leaking her name, the officials abused knowledge they obtained as state actors and allegedly deprived Joseph Wilson and Valerie Plame [hereinafter, "the Wilsons"] of their rights.
¶ 67 The Wilsons filed suit against Dick Cheney, Scooter Libby and Karl Rove, alleging that they violated the First Amendment by retaliating against Wilson242 and deprived Plame of her Fifth Amendment equal protection and property rights.243 The Wilsons further alleged that these individuals conspired under § 1985244 with an "invidiously discriminatory animus towards those who had publicly criticized the administration's justifications for going to war with Iraq."245 However, in an amended complaint, the Wilsons dropped this claim and proceeded instead with several direct Bivens claims under the First and Fifth Amendments.246
¶ 68 On July 19, 2007, the Wilsons' suit was dismissed.247 Since the Wilsons dropped their conspiracy claim, the court did not discuss the intracorporate conspiracy doctrine.248 However, this example is academically illuminating for a few reasons. First, Cheney went to great lengths to discredit Wilson because he regarded Wilson's op-ed as a personal attack since it implied that Cheney knew the alleged connection between Niger and Iraq was spurious.249 Cheney could not be held directly liable under § 1983 or Bivens because he took no action. Cheney could be liable under a conspiracy theory, however, since he allegedly supported and devised the action.250 Second, this example illustrates how joining alleged conspirators can be beneficial for plaintiffs seeking extensive damages.251 As such, this case shows how an act ordered by a wealthy executive but carried out by his inferiors implicates a § 1983 conspiracy and the practical abuse of power. It would be absurd to suggest that these men are incapable of conspiring simply because they all worked for the White House.252 While we may never know the truth about these events, it seems that in attempting to discredit their detractor, Cheney, Rove, and Libby conspired to abuse classified knowledge they obtained as federal actors to deprive the Wilsons of their rights.253
¶ 69 The veil-piercing notion of "looking through" the agency relationship to reach the facts becomes common sense when one recognizes that a claim of civil conspiracy "is essentially a tort action."254 Those with state authority have a duty not to deprive others of their legal rights, as originally determined by the 1871 Act, now codified at §§ 1983 and 1985.255 Victims of conspiracies under these sections must establish breach of that duty, an injury caused by the breach and damages.256 When viewed as a tort, the existence of an agency relationship is irrelevant because individuals are liable for their tortious actions, even if they were acting as agents.257 Thus, the "true basis of liability is the [agent's breach of] duty owed to the third person" resulting in an injury to that person.258
¶ 70 Proponents of the intracorporate conspiracy doctrine argue that conspiracy is a special kind of tort in that it cannot be committed unless the defendants are "capable" of conspiring. Intracorporate agents, they argue, are "incapable of conspiring" since any injurious act originated from a "single legal actor."259
¶ 71 This argument has yet to receive the scrutiny it deserves. Civil conspiracy is defined as (1) an agreement by multiple persons (2) to jointly (3) accomplish some unlawful purpose.260 Agents of municipal entities are capable of conspiring since they, like any other group of human beings, can agree to mutually attain an unlawful purpose, i.e., the deprivation of another person's legal rights. All three elements of a civil conspiracy are fulfilled. The difficulty arises in the fact that carrying out the unlawful purpose requires the conspirators to act in their official capacity as agents of the state. In doing so, their actions are attributed to the single municipal entity.
¶ 72 Among the elements necessary to state a claim of conspiracy under §§ 1983 and 1985 are the (1) existence of a conspiracy among the defendants and (2) an action taken in furtherance of that conspiracy resulting in a deprived right.261 Most courts hold that the first element fails when intracorporate conspiracies are alleged.262 This may be due, in part, to the fact that courts use unnecessarily broad language when applying the doctrine.263
¶ 73 However, the conspiracy element does not fail on account of impossibility.264 Instead, it is the act depriving the plaintiff of a right—the second element—that fails, because, according to the doctrine, the act is attributed to the state entity and not the alleged conspirators. The plaintiff, therefore, cannot show that the alleged conspirators performed an act furthering the object of the conspiracy because the single state actor is the only "person" who acted. While the state's act furthered the conspiracy, the state itself was not a conspirator; thus neither the state nor the conspirators—lacking the first and second elements, respectively—may be held liable.
¶ 74 Despite the "single actor," however, when the municipal corporate action results in a deprivation of rights, Congress intended the 1871 Act to permit recovery. Therefore, the agency relationship is irrelevant when the plaintiff can establish the civil rights conspiracy due to the defendants' breach of their duty not to deprive others of their rights. This notion is supported by Rebel Van Lines v. Compton, which noted that applying "the intra-corporate conspiracy [doctrine] to public entities and officials would immunize official policies of discrimination. This result would contravene the law as it now exists."265
¶ 75 Permitting recovery would have broad implications if not for the Supreme Court's holding in Monell v. Department of Social Services.266 There, the Court held that "a municipality cannot be held liable solely because it employs a tortfeasor."267 It may be held liable, however, "when execution of a [state] policy or custom, [set by] those whose edicts or acts may fairly be said to represent official policy, inflicts the injury . . . under § 1983."268 Absent a showing of official policy, only the conspirators may be held liable.269 As such, the scope of this article is limited to the intracorporate conspiracy doctrine's effect of barring claims against individual conspirators and not against their principal municipal corporate entities.270
¶ 76 The nature and number of exceptions to the intracorporate conspiracy doctrine demonstrate that, in the civil rights field, its reach is overbroad. The Dombrowski decision was correct because the plaintiff alleged that one agent conspired with his corporate principal.271 However, the rule does not accord with Congress's intent when there are multiple human conspirators. Though the conspirators acted as agents of one entity, they agreed to a course of action which deprived another person of her legal rights; the fact that the conspirators accomplished the deprivation through an official action by a non-human entity should not negate their liability.272
¶ 77 One exception is particularly useless given that §§ 1983 and 1985 are generally violated by state actors. The Dombrowski court obliquely qualified its dicta on the doctrine, suggesting that, if the Klan were to incorporate, its agents "could not carry out acts of violence with impunity simply because they were acting under orders from the Grand Dragon."273 Courts construed this to mean "conspirators may not create a principal for whom they are agents in order to make their acts all the acts of a single legal person that cannot be charged with conspiring with itself."274 This exception benefits no one, since state actors never create the municipal entities through which they act.275 While the defendants in Dickerson and Shaw did not create the state entity through which they deprived the plaintiffs of constitutional rights, they utilized the entity to shield themselves from liability for their wrongful acts. In this way, conspirators are using their state authority to divest individuals of their constitutional rights "with impunity."276
¶ 78 Moreover, the police misconduct exception—whereby police officers are held liable for conspiring because their acts are clearly outside the scope of employment277—is myopic. Non-police government employees abuse power and engage in the same type of bad behavior as police officers. The only difference is that police misconduct is salient, highly visible to ordinary people, and clearly outside the scope of employment, while the misconduct of government agents and officials is inconspicuous and difficult to trace.278
¶ 79 Furthermore, the exception based on a series of actions or continuing instances of discrimination279 demonstrates the logical fallacy of the doctrine. The exception disavows the notion that corporate agents are incapable of conspiring where courts find ample evidence of a conspiracy through multiple acts.280 Thus, the exception holds that corporate agents can conspire, and intimates that, in other cases, there is simply not sufficient evidence of a conspiracy.
¶ 80 Finally, the "solely personal stake/motive"281 standard is inequitable and inconsistent with the intent of the 1871 Act and other civil rights jurisprudence.282 The standard does not take into account the fact that the majority of injuries leading to viable conspiracy claims under §§ 1983 and 1985 are perpetrated by those cloaked in state power.283 Conspiracies alleged under these sections tend to injure the powerless, so requiring plaintiffs to show that the action was accomplished without a single official reason would negate claims Congress intended to permit.284 In addition, this standard is inconsistent with other civil rights cases. In discrimination cases, the Supreme Court has held that plaintiffs only need show that an improper purpose was a "motivating" or a "substantial" factor in the decision.285 As such, discriminatory acts taken in an official capacity should be viewed as outside the scope of employment if personal motives played a motivating or substantial role in the decision leading to the injurious act.286 Thus, rather than the broad holding that agents of a single entity cannot conspire to deprive people of their civil rights, courts should adopt this standard, which jibes with the wishes of Congress and by which §§ 1983 and 1985 conspiracies may be remedied equitably.
¶ 81 I argue that the determination of whether a conspiracy existed should draw upon the motive of the act furthering the conspiracy.287 It is not always clear whether the motive for the act was possessed by the principal or the alleged conspirators. If the principal had a legitimate motive, it is likely no conspiracy existed. If, however, the state actors had a substantial, discriminatory motive288 for the official action while the principal had no motive, then both parties should be afforded an opportunity to present their evidence. Thus, courts should employ a burden-shifting framework in deciding whether the plaintiff proved the existence of the conspiracy. Further, courts should consider granting qualified immunity to the state actors.
¶ 82 The question should not be whether the decision was made solely for personal reasons, but whether personal reasons played a substantial role in the final determination.289 The latter standard is consistent with the intent of Congress. The former would bar, for example, Dickerson's claim, due to the principal's motive to hold someone accountable for the escape. While this motive is legitimate, it would be unjust to hold Dickerson and his subordinates responsible for the escape when they played no part in it. Thus, if personal reasons played a substantial role in the decision that caused the plaintiffs' injuries, the act—while executed in an official capacity—was undertaken for a dubious official reason. As such, the lack of a legitimate official reason must mean the act was outside the scope of employment.290 Even though the defendant acted while wearing her "official hat," her decision to act was made while wearing her "individual hat."291 Therefore, plaintiffs should recover if they show that a "discriminatory purpose was a motivating [or, in other words, a substantial] factor" in the injurious decision.292 This standard is optimal because when an improper purpose is a substantial factor in the action, applying the intracorporate conspiracy doctrine to agents of state entities empowers them to jointly abuse their authority.
¶ 83 In Garza v. City of Omaha, the Eighth Circuit found an exception to the doctrine when the individual defendants are named and are alleged to have acted "outside the scope of their employment for personal reasons."293 The Eighth Circuit held the § 1985 claim actionable based on evidence that the defendants "were acting to further their personal bias."294 While "furthering personal bias" would be an overly broad rule because many state actions arguably could fulfill this purpose, the "substantial factor" test is consistent with Congress's intent when applied correctly. One court framed the standard by applying the personal motive exception "where the conspirator gained a direct personal benefit . . . wholly separable from" the entity's benefit.295 This standard accords with Congress's intent because the motive for the act determines whether a conspiracy existed.296
¶ 84 To be clear, I am not advocating a total rejection of the intracorporate conspiracy doctrine in the civil rights arena. In cases where it is alleged that one agent conspired with his municipal corporate principal, the doctrine should apply.297 The doctrine should also bar liability "for routine, collaborative business decisions that are later alleged to be discriminatory"298 since there is no legal injury where no discrimination existed. This, however, requires a determination of whether the action was in fact discriminatory.
¶ 85 Under the proposed standard, courts should determine the motive behind the act furthering the conspiracy. Since conspiracies are, by definition, undertaken for illegitimate purposes, a legitimate and nondiscriminatory motive will prove that no conspiracy existed. Our society is keen to seek out and uncover conspiracies, but perhaps too keen: human nature leads some to believe that conspiracies exist when there are far simpler answers.299 When alleged conspirators can readily articulate valid and justifiable reasons for the action giving rise to the plaintiff's injury, it must be assumed that the conspiracy exists only in the mind of the plaintiff. As such, there is truly no legal injury. The question, then, is how one determines the legitimacy of an injurious action.
¶ 86 The answer is a tool used in similar discrimination cases to determine the legitimacy of an employer's adverse actions: the McDonnell Douglas framework. While the framework was originally developed in the context of Title VII, courts have applied it to Reconstruction-era civil rights legislation, including the 1871 Act.300
¶ 87 To begin, the plaintiff must prove "by the preponderance of the evidence a prima facie case of discrimination."301 Then, the defendant must assert a "legitimate, nondiscriminatory reason for" the allegedly unconstitutional deprivation.302 Finally, the plaintiff is given the "opportunity to prove by a preponderance of the evidence that the . . . reasons offered by the defendant" are mere pretexts.303
¶ 88 With this framework extended to § 1983 conspiracy claims, the plaintiff would establish her own case and the defendant's personal motive. Similarly, in § 1985 claims, the plaintiff must establish an invidiously discriminatory animus.304 For both, plaintiffs must prove the act was illegitimately discriminatory, meaning it was substantially prompted by personal motives.
¶ 89 With this framework in place, plaintiffs like Dickerson and Shaw would have a fair chance to recover for the deprivation of their rights. Dickerson could have proven by a preponderance of the evidence that he was demoted to protect the integrity of the white officers truly responsible for the prisoner's escape.305 Shaw could have proven by a preponderance of the evidence that he was fired for exercising his First Amendment right to speak out against the mayor's acts of favoritism, which illegitimately obstructed justice.306 In countless other cases, plaintiffs would be given the chance to establish a conspiracy-fueled rights deprivation without having their claim virtually disqualified before it is filed. Only after hearing both sides of the issue and determining the legitimacy of an action should a court rule on the applicability of the intracorporate conspiracy doctrine. Even then, courts may negate a defendant's liability, if appropriate, through qualified immunity.307
¶ 90 The intracorporate conspiracy doctrine should not negate civil rights conspiracy liability against individual defendants where plaintiffs can establish a conspiratorial deprivation of their rights that was substantially driven by a personal motive. The substantial factor test and the McDonnell Douglas burden-shifting framework—both of which are already used in employment discrimination cases—will serve the purpose of aiding courts in determining whether the acts alleged were, in fact, precipitated by a conspiracy. In cases where a conspiracy existed, courts should disregard the artificial municipal entity to reach the facts because applying the intracorporate conspiracy doctrine to immunize state agents who would deprive others of their rights is contrary to the intent of the 1871 Act and age-old civil rights conspiracy law. In passing the 1871 Act, Congress provided remedial measures for those conspiracies that it believed violated public policy. The artificial corporate entity must not be used to sanction violations of that policy.
¶ 91 When the courts first created the piercing the corporate veil doctrine, it was understood that the artificial entity was a tool not to be abused. Sadly, decades of jurisprudence have deserted this conception to the benefit of government agents and to the detriment of individuals. While the Constitution set forth the principles by which our government functions, our true founding principles are manifest in the Bill of Rights and the Declaration of Independence, where the sanctity of individual dignity pervades. The intracorporate conspiracy doctrine's application in the civil rights arena subverts this dignity. Thus, courts should recognize that the need to rectify unjust conspiracies that deprive individuals of their rights is far more important than protecting state actors from liability for joint wrongs realized through the abuse of their state power.
Every person who, under color of [law], subjects, or causes to be subjected, any [person within the jurisdiction of the United States] to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured . . . .
42 U.S.C. § 1983 (2000).
two or more persons . . . conspire . . . for the purpose of depriving . . . any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws [and] if one or more of the persons engaged [in the conspiracy] do, or cause to be done, any act in furtherance of the object of such conspiracy, whereby another is injured . . . or deprived of having and exercising any right or privilege of a citizen of the United States, the party so injured or deprived may have an action for the recovery of damages . . . against any one or more of the conspirators.
Id.
[A] complaint must allege that the defendants did (1) "conspire . . ." (2) "for the purpose of depriving . . . any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws." It must then assert that one or more of the conspirators (3) did, or caused to be done, "any act in furtherance of the object of [the] conspiracy," whereby another was (4a) "injured in his person or property" or (4b) "deprived of having and exercising any right or privilege of a citizen of the United States."
Id. at 102-03.
This conclusion is not dictated by the first premise of corporate personality, that a corporation is a single legal entity apart from its constituents, but by the second premise, that a corporation is an artificial person without an independent will. See supra notes 86-93 and accompanying text. In contrast, intracorporate agents have independent wills because they are human beings. Thus, they are and always have been capable of conspiring. See infra note 263. That intracorporate agents now enjoy virtual immunity to conspiracy charges is partly due to the shortsightedness of plaintiffs lawyers. See infra note 270.
The Hartman court supported its "solely personal reasons" standard by citing Fletcher's Law of Corporations § 4877. Hartman, 4 F.3d at 470. This section, however, does not govern the liabilities of agents; it regulates the liability of the corporation itself. Fletcher, supra note 20, § 4877. Further, Fletcher's language in a later section contradicts the holding of Hartman explicitly, noting that no conspiracy exists when agents "are acting solely for the corporation." Id. § 4884. In other words, agents may be held liable when their acts are motivated by anything other than the welfare of the corporation. This interpretation is further cemented when Fletcher notes that agents "will not be held personally liable [where they acted] on behalf of the corporation and maintained no independent personal stakes in the object of the conspiracy." Id. (emphasis added). Thus, a conspirator can be held personally liable if he has any independent personal stake in the conspiracy's unlawful objective. This position accords with a substantial number of precedents, including Greenville Publishing, Nelson Radio, and Garza v. City of Omaha. See supra notes 119-121 and accompanying text; Garza v. City of Omaha, 814 F.2d 553, 556 (8th Cir. 1987).
(1) the injustice . . . of subjecting to liability an officer who is required . . . to exercise discretion; (2) the danger that the threat of such liability would deter his willingness to execute his office with the decisiveness and the judgment required by the public good; [and (3)] the fear that the threat of personal liability might deter citizens from holding public office.
Owen v. City of Independence, Mo., 445 U.S. 622, 654 (1980). The existence of a conspiracy and, thus, the legitimacy of an injurious action, should be threshold issues to reaching the question of qualified immunity. While the existence of qualified immunity should generally be resolved early in a lawsuit, resolution of such a claim must await a full trial where there are disputed issues of material fact—in this case, whether a conspiracy existed. Saucier v. Katz, 533 U.S. 194, 200-01 (2001); Mitchell v. Randolph, 215 F.3d 753, 755 (7th Cir. 2000). Therefore, if an action is adjudged to be illegitimate and injurious, the first rationale for qualified immunity does not apply because the actor willingly engaged in a conspiracy, negating any claim of merely exercising discretion. The second and third rationales, however, are reasonable considerations that should be balanced against the facts of the case. If the act is entirely illegitimate, qualified immunity should not apply since the rationales are not implicated. Citizens would not be deterred from holding public office or executing such office with decisiveness by a denial of qualified immunity where the facts surrounding the denial portrayed an illegitimate and unjust conspiracy. If, however, the act was arguably legitimate, and imposing liability may threaten the willingness of citizens (1) to work in public office or (2) to execute their office with decisiveness, a court should extend immunity. In making this determination, courts should consider how the public might view the act and resolve doubts in favor of granting immunity.
| © Copyright 2008 by Northwestern University School of Law, Northwestern Journal of Law and Social Policy | Volume 3 Issue 1 (Winter 2008) |