Flagg Bros., Inc. v. Brooks 436 U.S. 149 (1978)

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FLAGG BROS., INC. v. BROOKS 436 U.S. 149 (1978)

Brooks is one of a series of burger court decisions reestablishing the state action limitation as a barrier to judicial enforcement of fourteenth amendment rights against private persons acting under state authority. The Uniform Commercial Code, as adopted in New York, authorizes a warehouse operator to sell goods stored in order to pay overdue warehousing charges. This notion of a "warehouseman's lien" is an ancient common law remedy. When Brooks and her family were evicted from their apartment, a city marshal had her goods stored with Flagg Bros. Ten weeks later, Flagg Bros. wrote to Brooks, demanding payment of storage charges and threatening to sell her goods to satisfy the charges accrued. Brooks brought a class action against Flagg Bros. for damages and injunctive relief under federal civil rights laws claiming due process and equal protection violations. (See Injunction.) The Supreme Court held, 5–3, that the proposed sale did not amount to state action; thus there had been no constitutional violation.

Justice william h. rehnquist wrote for the majority, as he had done in other recent cases strengthening the state action limitation. The proposed sale did not fit the "public function" doctrine of state action (here renamed the "sovereign function" doctrine), because the function of dispute resolution historically had not been the exclusive province of the states. Nor had the state authorized or encouraged the use of this creditor's remedy in such a way as to take responsibility for its exercise. The Uniform Commercial Code "permits but does not compel" a warehouse operator's threat to sell goods stored and merely announces the circumstances in which the state will not intervene with that private sale.

Justice william j. brennan did not participate in the decision. Justice john paul stevens dissented, joined by Justices byron r. white and thurgood marshall. The distinction between state permission and state compulsion was untenable, Stevens argued; on the Court's theory, for example, the state could "announce" its intention not to intervene when a finance company entered a private home to repossess property, with no finding of state action. He also argued persuasively that the "exclusive sovereign function" notion had no basis in the Court's prior decisions. What the state had done here was to "order binding, nonconsensual resolution of a conflict between debtor and creditor"—which is "exactly the sort of power with which the Due Process Clause is concerned."

Kenneth L. Karst