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LEBRON v. NATIONAL RAILROAD PASSENGER CORPORATION

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OCTOBER TERM, 1994

Syllabus

LEBRON v. NATIONAL RAILROAD PASSENGER CORPORATION

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

No. 93-1525. Argued November 7, 1994-Decided February 21, 1995

Petitioner Lebron, who creates billboard displays that comment on public issues, filed suit claiming, inter alia, that respondent National Railroad Passenger Corporation (Amtrak) had violated his First Amendment rights by rejecting a display for an Amtrak billboard because of its political nature. The District Court ruled that Amtrak, because of its close ties to the Federal Government, was a Government actor for First Amendment purposes, and that its rejection of the display was unconstitutional. The Court of Appeals reversed, noting that Amtrak was, by the terms of the legislation that created it, not a Government entity, and concluding that the Government was not so involved with Amtrak that the latter's decisions could be considered federal action.

Held: Where, as here, the Government creates a corporation by special law, for the furtherance of governmental objectives, and retains for itself permanent authority to appoint a majority of that corporation's directors, the corporation is part of the Government for purposes of the First Amendment. Pp. 378-400.

(a) It is proper for this Court to consider the argument that Amtrak is part of the Government, even though Lebron disavowed it in both lower courts and did not explicitly raise it until his brief on the merits here. It is not a new claim, but a new argument to support his First Amendment claim, see, e. g., Yee v. Escondido, 503 U. S. 519, 534-535; it was passed upon below, see, e. g., United States v. Williams, 504 U. S. 36, 41; and it was fairly embraced within both the question presented and the argument set forth in the petition. Pp. 378-383.

(b) Amtrak was created by the Rail Passenger Service Act of 1970 (RPSA) to avert the threatened extinction of passenger trains in the interest of "the public convenience and necessity." The legislation establishes detailed goals for Amtrak, sets forth its structure and powers, and assigns the appointment of a majority of its board of directors to the President. Pp. 383-386.

(c) There is a long history of corporations created and participated in by the United States for the achievement of governmental objectives. Like some other Government corporations, Amtrak's authorizing stat-cralaw


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ute provides that it "will not be an agency or establishment of the United States Government," 84 Stat. 1330; see also 45 U. S. C. § 541. Pp.386-391.

(d) Although § 541 is assuredly dispositive of Amtrak's governmental status for purposes of matters within Congress's control--e. g., whether it is subject to statutes like the Administrative Procedure Act-and can even suffice to deprive it of all those inherent governmental powers and immunities that Congress has the power to eliminate-e. g., sovereign immunity from suit-it is not for Congress to make the final determination of Amtrak's status as a Government entity for purposes of determining the constitutional rights of citizens affected by its actions. The Constitution constrains governmental action by whatever instruments or in whatever modes that action may be taken, Ex parte Virginia, 100 U. S. 339,346-347, and under whatever congressional label, Cherry Cotton Mills, Inc. v. United States, 327 U. S. 536, 539. National Railroad Passenger Corporation v. Boston & Maine Corp., 503 U. S. 407, 410, and National Railroad Passenger Corporation v. Atchison, T. & S.

(e) Amtrak is an agency or instrumentality of the United States for the purpose of individual rights guaranteed against the Government by the Constitution. This conclusion accords with the public, judicial, and congressional understanding over the years that Government-created and -controlled corporations are part of the Government itself. See, e. g., Reconstruction Finance Corporation v. J. G. Menihan Corp., 312 U. S. 81, 83; Government Corporation Control Act, § 304(a), 59 Stat. 602. A contrary holding would allow government to evade its most solemn constitutional obligations by simply resorting to the corporate form, cf. Pennsylvania v. Board of Directors of City Trusts of Philadelphia, 353 U. S. 230, 231. Bank of United States v. Planters' Bank of Georgia, 9 Wheat. 904, 907, 908, and Regional Rail Reorganization Act Cases, 419 U. S. 102, 152, distinguished. Pp. 394-399.

12 F.3d 388, reversed and remanded.

SCALIA, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and STEVENS, KENNEDY, SOUTER, THOMAS, GINSBURG, and BREYER, JJ., joined. O'CONNOR, J., filed a dissenting opinion, post, p. 400.

David D. Cole argued the cause for petitioner. With him on the briefs were R. Bruce Rich and Gloria C. Phares.cralaw


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