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In Serpas v. Schmidt (7th Cir. 1986), 808 F.2d 601, the court invalidated administrative rules of the Illinois Racing Board that conditioned the receipt of certain occupational licenses issued by the Board on the licensees' implied consent to a variety of warrantless administrative searches.
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No. 85-2393.
Argued April 2, 1986.
Decided December 19, 1986.
Moshe Jacobius, Asst. Atty. Gen., Chicago, Ill., for defendants-appellants.
Thomas B. Quinn, Schiff, Hardin Waite, Chicago, Ill., for plaintiffs-appellees.
Appeal from the United States District Court for the Northern District of Illinois.
Before CUDAHY and RIPPLE, Circuit Judges, and ESCHBACH, Senior Circuit Judge.
Plaintiffs brought this suit, individually and on behalf of all exercise persons, grooms and hot walkers (collectively, "backstretchers") at Illinois race tracks, seeking declaratory and injunctive relief from certain investigative practices authorized by the Illinois Racing Board (the "Board") and carried out by the Illinois Department of Law Enforcement ("IDLE") on the ground that these practices violated the Fourth Amendment, as applied to the State of Illinois through the Fourteenth Amendment. The challenged practices included warrantless searches of the backstretchers' on-track dormitory rooms and investigatory stops and searches of the backstretchers' persons within the race track enclosure. Plaintiffs also challenged the Board's policy of granting them occupation licenses only upon their consent to these searches. The defendants argued that the plaintiffs lack a legitimate expectation of privacy owing to pervasive state regulation of the horse-racing industry, the nature of the premises searched and the plaintiffs' implied consent to the searches when they accepted their employment. The district court granted the plaintiffs' motion for a preliminary injunction and, later, enjoined the searches permanently on plaintiffs' motion for summary judgment. We affirm.
I.
Backstretchers work at race tracks, feeding, grooming, exercising and generally taking care of the race horses. They are employed by the horses' trainers and licensed by the Board under authority vested in the Board by the Horse Racing Act of 1975 (the "Act"), Ill.Rev.Stat. ch. 8 § 37-1 et seq. (Smith-Hurd Supp. 1986). Many of the backstretchers live in dormitory rooms located in the backstretch, which is the area where the horses are stabled. These rooms are owned by the race track and made available to the trainers and the backstretchers in their employ at no charge. Backstretchers do not have to live at the track, but many do so for reasons of convenience and economy.
Because backstretchers have contact with the race horses immediately before and between races, they are in a position to administer drugs or apply mechanical devices (called "buzzers") to the horses, both of which affect the speed of a horse and hence the outcome of a race. The Act forbids these practices. Ill.Rev.Stat. ch. 8, §§ 37-36, 37-37. The Board and IDLE, which the legislature has charged with the enforcement of the Act, id. § 37-34, believe that warrantless searches of all backstretch areas, including the dormitories, and of licensees' persons constitute the only effective way of enforcing the statutory prohibitions against the use of drugs and buzzers. Backstretch areas and licensees are searched when IDLE has received a "tip" or when irregularities are noted in a horse's performance; searches are also performed at random. We have no reason to question the Board's representations about the threat posed by drugs and buzzers, and the need to take strong measures against them.
In this respect, the Act vests in the Board broad authority to regulate the horse-racing industry in Illinois. Specifically,
The Board, and any person or persons to whom it delegates this power, is vested with the power to enter the office, horse race track, facilities and other places of business of any organization licensee to determine whether there has been compliance with the provisions of this Act and its rules and regulations.
Ill.Rev.Stat. ch. 8, § 37-9(c). Pursuant to its rulemaking powers, the Board has promulgated Thoroughbred Rule 322 and Harness Racing Rule 25.19 (the "Rules"), which employ identical language and read as follows:
(a) The Illinois Racing Board or the state steward investigating for violations of law or the Rules and Regulations of the Board, shall have the power to permit persons authorized by either of them to search the person, or enter and search the stables, rooms, vehicles, or other places within the track enclosure at which a meeting is held, or other tracks or places where horses eligible to race at said race meeting are kept, of all persons licensed by the Board, and of all employees and agents of any race track operator licensed by said Board; and of all vendors who are permitted by said race track operator to sell and distribute their wares and merchandise within the race track enclosure, in order to inspect and examine the personal effects or property on such persons or kept in such stables, rooms, vehicles, or other places as aforesaid. Each of such licensees, in accepting a license, does thereby irrevocably consent to such search as aforesaid and waive and release all claims or possible actions for damages that he may have by virtue of any action taken under this rule. Each employee of a licensed operator, in accepting his employment, and each vendor who is permitted to sell and distribute his merchandise within the race track enclosure, does thereby irrevocably consent to such search as aforesaid and waive and release all claims or possible actions for damages they may have by virtue of any action taken under this rule. Any person who refuses to be searched pursuant to this rule may have his license suspended or revoked.
(b) The Illinois Racing Board delegates the authority to conduct inspections and searches, under this rule, to the Chief Investigator of the Illinois Racing Board and to Special Agents of the Illinois Bureau of Investigation, or other designees of the Department of Law Enforcement assigned, from time to time, to assist the Chief Investigator in his duties.
The challenged searches were undertaken pursuant to this regulation.
The Act also empowers the Board to prescribe application forms and issue licenses to backstretchers. Ill.Rev.Stat. ch. 8, §§ 37-15, 37-20. Prior to the entry of the preliminary injunction in this case, the license application form used by the Board quoted the text of the above Rules and conditioned the license's issuance upon consent to the searches authorized by the Rules.
The material facts about the searches of the named plaintiffs are undisputed. Don Serpas, Raymond Johnson and Carl Waters are employed as grooms and live in residential quarters at Arlington Park Racetrack. Their residential quarters have been searched by IDLE agents; they have also been stopped and personally searched by IDLE agents within the race track enclosure. No evidence of crime was found during any of the challenged searches. The plaintiffs acknowledge that when they signed the license application forms, they consented to the searches. They also admit that they consented to each of the searches at the time it occurred. They claim, however, that they would not have consented to these warrantless searches if they had not been required to give consent in order to remain in a job as a backstretcher.
The affidavits submitted by the parties differed in some of the details of the searches. The district court did not consider any of these disputes material. See Serpas v. Schmidt, No. 82-C-4715, mem. op. at 2n. 2 (N.D.Ill. June 16, 1983). The appellants do not contest before this court the propriety of deciding the question presented to the district court by summary judgment.
On July 30, 1982, these three filed a complaint in the Northern District of Illinois, naming as defendants present and former members of the Board, the director of IDLE and certain unknown IDLE agents and seeking injunctive and declaratory relief. On September 24, 1982, they filed a motion for a preliminary injunction, which was granted in its entirety on June 16, 1983. This order of the district court enjoined the defendants from (1) conducting or authorizing searches of persons and residential quarters without a warrant or probable cause; (2) conducting or authorizing investigatory stops of backstretchers without a reasonable suspicion, based on articulable facts, that the backstretchers stopped were engaged in criminal activity, and (3) conditioning the issuance of occupation licenses to backstretchers upon consent to these searches. Serpas v. Schmidt, No. 82-C-4715, mem. op. (N.D.Ill. June 16, 1983).
On September 19, 1983, the trial court certified Serpas, Johnson and Waters as named representatives of a class consisting of all grooms, exercise persons and hot walkers at Illinois race tracks. In August and October 1984, the parties filed crossmotions for summary judgment. The trial court filed a memorandum opinion, granting the plaintiffs' motion and entering a permanent injunction on July 11, 1985. Serpas v. Schmidt, 621 F. Supp. 734 (N.D. Ill. 1985). This appeal followed.
After oral argument, we asked the parties to provide us with additional briefing on the question whether we should abstain and permit the Illinois courts to rule on the state law issues in the case, thus arguably mooting the federal constitutional questions. See Railroad Commission of Texas v. Pullman Co., 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941). This question was first raised at oral argument in the course of questioning by the panel.
After examining the supplemental briefs, we have concluded that abstention is not appropriate in this case. As the dissent correctly points out, this circuit has held that it might be proper in some cases for an appellate court to order abstention even though neither party had raised this issue. See Waldron v. McAtee, 723 F.2d 1348, 1351 (7th Cir. 1983). However, we do not think that it would be appropriate for us to order abstention sua sponte here. In the controversy before us, the federal courts are not "the lone guardian of the state's sovereign place under the Constitution," infra p. 609; the defendants are state officials who raised no objection to having the claims against them litigated in federal court until this court itself raised the abstention issue. See Mazanec v. North Judson-San Pierre School Corp., 763 F.2d 845, 848-49 (7th Cir. 1985) (State defendants did not request abstention until the end of trial; this is "an independent argument against abstention." "[I]f the responsible state officials are willing to litigate the case in federal court, that court does not have to force it back into state court.") (emphasis in original) (citation omitted).
In addition, there is a presumption in this circuit against abstaining once a case has gone to trial; this presumption holds at least "where neither party requested abstention before trial." Mazanec, 763 F.2d at 847. The district court in this case granted the plaintiffs' motion for a preliminary injunction in 1983 and enjoined the searches permanently in 1985 on plaintiffs' motion for summary judgment. The defendants did not raise an abstention issue during any of these proceedings, nor did they raise it before us. The dissent contends that Mazanec is not applicable to this case because Mazanec states that the presumption against abstaining may be rebutted if the state statute at issue could be interpreted narrowly and thus survive a constitutional challenge. Infra p. 609 n. 3. We believe, however, that the resolution of the constitutional issues in this case might well be necessary even if a state court found that the Act did not authorize the Rules. If the plaintiffs had validly consented to the searches or if they had a reduced expectation of privacy, it certainly could be argued that the defendants would not have needed an independent basis of authority under state law to conduct the searches. Thus, abstention might not produce a state law result which would be dispositive of the claims under the federal Constitution.
II.
A. Warrantless Searches of Dormitory Rooms
The Fourth Amendment protects against "unreasonable" searches and seizures. The reasonableness of a search depends upon a person's expectation of privacy in the place to be searched, provided that that expectation is one that society is willing to recognize as "reasonable." Katz v. United States, 389 U.S. 347, 361, 88 S.Ct. 507, 516, 19 L.Ed.2d 576 (1967) (Harlan, J., concurring). Appellants contend that the backstretchers' asserted expectation of privacy in their on-track dormitory rooms is not the sort of expectation that society recognizes as reasonable. They rely on historic state regulation of the horse-racing industry, the less than commodious quality of the ontrack quarters and the backstretchers' implied consent to the searches.
We have no doubt that horse racing is and ought to be a pervasively regulated industry. But a history of pervasive regulation of an industry is not by itself enough to render the warrant requirement superfluous. As we noted in Bionic Auto Parts and Sales, Inc. v. Fahner, 721 F.2d 1072, 1079 (7th Cir. 1983),
the degree and extent of past regulation comprise but a part, albeit a substantial part, of a determination of a "reasonable expectation of privacy" under the Fourth Amendment. Otherwise, no protections at all would be appropriate in closely regulated industries. The Fourth Amendment requires that a determination of the "reasonableness" of the intrusion be made. Even in closely regulated industries, the inspection provisions still must be tailored to the state's proper objectives, and they must minimize the dangers inherent in the unbridled exercise of administrative discretion.
It is certainly true, as appellants point out, that the Supreme Court has sanctioned warrantless searches of commercial premises in certain industries subject to longstanding governmental oversight. Donovan v. Dewey, 452 U.S. 594, 101 S.Ct. 2534, 69 L.Ed.2d 262 (1981) (mining); United States v. Biswell, 406 U.S. 311, 92 S.Ct. 1593, 32 L.Ed.2d 87 (1972) (firearms); Colonnade Catering Corp. v. United States, 397 U.S. 72, 90 S.Ct. 774, 25 L.Ed.2d 60 (1970) (alcoholic beverages). In each of these cases, however, an act of Congress expressly authorized the terms and conditions of searches on specified premises. The rationale for not requiring a warrant in such a situation is that a statutory inspection program "in terms of the certainty and regularity of its application, provides a constitutionally adequate substitute for a warrant." Dewey, 452 U.S. at 603, 101 S.Ct. at 2540. In that way, there is assurance that the individual's privacy interest and the government's interest in law enforcement are properly balanced. See Marshall v. Barlow's, Inc., 436 U.S. 307, 321, 98 S.Ct. 1816, 1824, 56 L.Ed.2d 305 (1978) ("The reasonableness of a warrantless search . . . will depend upon the specific enforcement needs and privacy guarantees of each statute.").
The statutory authority claimed by the appellants for the searches challenged here states that the Board and its delegates are "vested with the power to enter the office, horse race track, facilities and other places of business" of any licensee to ensure compliance with the Act. Ill.Rev. Stat. ch. 8, § 37-9(c). Appellants contend that the dormitory rooms are "facilities" for purposes of the Act. We agree with the district court that this is not a reasonable reading of the statutory language. The provision specifically lists a series of places, ending with the catch-all "other places of business." This concluding phrase effectively defines the earlier listed places as places of business. The statute in no way suggests that a residence may be searched.
We agree with the district court that these on-track dormitory rooms must be considered the backstretchers' "homes" for Fourth Amendment purposes. Appellants point out that the rooms are very small and located either adjacent to or above the stables in the backstretch of the track. Further, they are only temporary lodgings and are accessible to track authorities by a master key. Nonetheless, they are exclusively residential, and lodgings as cramped, inhospitable or temporary have been considered residences by the courts. See Stoner v. California, 376 U.S. 483, 84 S.Ct. 889, 11 L.Ed.2d 856 (1964) (hotel rooms); McDonald v. United States, 335 U.S. 451, 69 S.Ct. 191, 93 L.Ed. 153 (1948) (rooming houses); Smyth v. Lubbers, 398 F. Supp. 777 (W.D.Mich. 1975) (college dormitories). There is no evidence that the backstretchers conduct any of their business in the rooms; thus, cases such as United States v. Cerri, 753 F.2d 61 (7th Cir.), cert. denied, 472 U.S. 1017, 105 S.Ct. 3479, 87 L.Ed.2d 614 (1985), where petitioner conducted his gun business out of his home, are distinguishable. Given the historical legal protection afforded the home by the Fourth Amendment, see, e.g., United States v. United States District Court, 407 U.S. 297, 313, 92 S.Ct. 2125, 2134, 32 L.Ed.2d 752 (1972) ("physical entry of the home is the chief evil against which the wording of the Fourth Amendment is directed"), we will not assume that the Illinois legislature means to authorize warrantless residential searches unless it clearly states this intention.
There is no reason to doubt that drugs and mechanical devices pose major threats to the integrity of the horse racing industry. Nor do we question the reality of the Board's concerns about protecting horse racing without broad powers of surveillance over backstretchers and others. But the Fourth Amendment requires regularity of application and an impartial assessment of reasonableness, and these will be lacking when there is no adequate basis for regulatory searches in the controlling statute. Here, there is simply no authority for adopting a set of practices, significantly involving searches of residences and of the person, merely by publishing regulations that have no clear tie to the statute.
Even without explicit statutory authorization for these searches, the appellants contend that sufficient certainty of application to serve as a substitute for a warrant can be found in the regulatory scheme taken as a whole. We disagree. First, the Supreme Court has placed great weight on legislative determinations of the necessity for warrantless searches, see Dewey, 452 U.S. at 600, 101 S.Ct. at 2539 ("[A] warrant may not be constitutionally required when Congress has reasonably determined that warrantless searches are necessary. . . ."); Biswell, 406 U.S. at 315, 92 S.Ct. at 1596 (legality of search depends on "authority of a valid statute"); Colonnade, 397 U.S. at 76-77, 90 S.Ct. at 776-77 (stressing Congress' reasonable exercise of its broad authority to regulate liquor industry). Even so, to satisfy the "certainty and regularity" requirement, an "inspection program must define clearly what is to be searched, who can be searched, and the frequency of such searches." Bionic Auto Parts, 721 F.2d at 1078. The rules under which the IDLE agents operated do not impose any meaningful limitations on their discretion. As the district court noted.
The searches may be focused or random and are not restricted to particular times nor restricted to particular areas or items in those areas which are in plain view. . . . [T]he agents . . . may search plaintiffs' living quarters and personal effects as extensively as they wish. Plainly, the agents have an unrestricted scope of search; requiring them to hand out receipts or consent forms does not affect or limit the agent's discretion to undertake an exhaustive search of every personal effect in an individual's room.
Serpas v. Schmidt, 621 F. Supp. 734, 741 (N.D.Ill. 1985). The regulatory scheme here thus falls short of adequately substituting for a warrant. As the Supreme Court explained in rejecting a warrantless search scheme in Camara v. Municipal Court, 387 U.S. 523, 532-33, 87 S.Ct. 1727, 1732-33, 18 L.Ed.2d 930 (1967), "[t]his is precisely the discretion to invade private property which we have consistently circumscribed by a requirement that a disinterested party warrant the need to search." Hence, we agree with the district court that neither the statute nor the regulatory scheme here is sufficient to except these searches from the general rule that searches conducted without the safeguard of a warrant are unreasonable and violate the Fourth Amendment, see Johnson v. United States, 333 U.S. 10, 13-14, 68 S.Ct. 367, 368-69, 92 L.Ed. 436 (1948).
Finally, the appellants argue that the backstretchers impliedly consented to the searches by accepting occupation licenses conditioned upon compliance with Rules 322 and 25.19. We think that the district court approached this contention properly when it noted that "the issue is not whether consent can be implied, but whether, absent the condition, the challenged searches are constitutional." Serpas v. Schmidt, 621 F. Supp. 734, 742 (N.D. Ill. 1985). While it is true that those who enter highly regulated fields do so with notice of an administrative search scheme and that this affects their expectation of privacy, see Dewey, 452 U.S. at 600, 101 S.Ct. at 2539 (when regulation sufficiently comprehensive, owner "cannot help but be aware that his property will be subject to periodic inspections undertaken for specific purposes"), it is also clear that "the legality of the search depends not on consent but on the authority of a valid statute." Biswell, 406 U.S. at 315, 92 S.Ct. at 1596. As we have noted, these searches, standing alone, are unconstitutional. The Board may not issue a license conditioned simply on the applicant's consent to waive a constitutional right. See, e.g., Cole v. Richardson, 405 U.S. 676, 92 S.Ct. 1332, 31 L.Ed.2d 593 (1972) (public employment may not be conditioned on waiver of First Amendment rights); Spevack v. Klein, 385 U.S. 511, 87 S.Ct. 625, 17 L.Ed.2d 574 (1967) (license to practice law may not be conditioned upon waiver of Fifth Amendment rights); Armstrong v. New York State Commissioner of Correction, 545 F. Supp. 728 (N.D.N.Y. 1982) (employment as prison guard may not be conditioned upon waiver of Fourth Amendment rights). The district court also correctly ruled that the fact that the named plaintiffs actually consented to each search before it was performed is irrelevant given the posture of this case. Whether or not plaintiffs consented to these searches in the past, their status as licensees subjects them to the threat of searches in the future.
B. Warrantless Searches of the Backstretchers
The district court also enjoined the Board and IDLE's practice of conducting warrantless stops and searches of the backstretchers' persons within the race track enclosure. Appellants have not suggested that we should analyze the personal searches any differently from the residential searches, and we, too, think that the same rules apply. Like searches of property, searches of the person are generally impermissible absent a warrant issued upon a determination of probable cause. New York v. Belton, 453 U.S. 454, 457, 101 S.Ct. 2860, 2862, 69 L.Ed.2d 768 (1981); Mary Beth G. v. City of Chicago, 723 F.2d 1263, 1268 (7th Cir. 1983). The deficiencies we have noted in the statute and regulatory scheme apply equally to these personal searches, and the arguments based upon consent are equally unpersuasive in this context.
Appellants argue that we are bound to reverse the district court on the authority of the Supreme Court's summary affirmance of the unpublished decision of a three-judge panel in Wilkey v. Illinois Racing Board, No. 74-C-3524 (N.D.Ill. 1975), aff'd, 423 U.S. 802, 96 S.Ct. 9, 46 L.Ed.2d 23 (1975). In that case, the court upheld a Board rule that authorized a personal search of a licensee veterinarian in the backstretch of the track. Unpublished opinions have no precedential effect in this circuit. See Circuit Rule 35. Summary affirmances by the Supreme Court do have some precedential effect, although they affirm the lower court's judgment only and not its rationale. Summary affirmances "prevent lower courts from coming to opposite conclusions on the precise issues presented and necessarily decided by those actions." Mandel v. Bradley, 432 U.S. 173, 176, 97 S.Ct. 2238, 2240, 53 L.Ed.2d 199 (1977). Wilkey involved a challenge by a Board-licensed veterinarian to Rule 322. He had lost his license after refusing to consent to a personal search. Precedential effect "is to be assessed in the light of all of the facts [of the] case," id. at 177, 97 S.Ct. at 2241, and Wilkey is distinguishable, notably in that the Board argued that there was probable cause to search Wilkey. Further, we note that the Court affirmed Wilkey before its more recent pronouncements on the limits of the administrative search exception, Marshall v. Barlow's, Inc., 436 U.S. 307, 98 S.Ct. 1816, 56 L.Ed.2d 305, and Donovan v. Dewey, 452 U.S. 594, 101 S.Ct. 2534, 69 L.Ed.2d 262. In light of these factors, we do not think we are bound by the Supreme Court's summary affirmance in Wilkey.
As we have noted, we are certainly not unsympathetic to the appellants' argument that extraordinary surveillance procedures are necessary to preserve the integrity of horse racing. The simple fact is, however, that the Illinois statute falls far short of providing an adequate basis for the extraordinary procedures undertaken here.
For the foregoing reasons, the judgment of the district court is AFFIRMED.
The federal courts should abstain from deciding this case to provide the state courts of Illinois an opportunity to construe the state statute at issue, thus potentially significantly altering or entirely mooting the constitutional inquiry. Thus, while I have no particular objection to the constitutional jurisprudence set forth in the majority opinion, I must dissent.
The challenged searches in the instant case were authorized by the Illinois Racing Board (the "Board") under Thoroughbred Rules 322 and 25.19 (the "Rules"), and were purportedly issued under the authority of the Horse Racing Act of 1975, as amended (the "Act"), Ill.Rev.Stat. ch. 8, § 37-9 (Smith-Hurd Supp. 1986). After undergoing searches of their persons and rooms at a racetrack pursuant to these Rules, the plaintiffs filed an action in federal district court, claiming a violation of 42 U.S.C. § 1983 (1982), and requesting damages as well as declaratory and injunctive relief. The district court denied damages but issued a permanent injunction prohibiting defendants from enforcing the Rules via searches like those challenged. The trial court also declared the Rules invalid under the Fourth Amendment, a determination entirely unnecessary on the record in this case. Only the decisions on injunctive and declaratory relief have been challenged on appeal.
Some justices have on occasion taken the position that Pullman abstention ought not to apply to cases brought under the Civil Rights Act, see, e.g., Harrison v. NAACP, 360 U.S. 167, 180-81, 79 S.Ct. 1025, 1032, 3 L.Ed.2d 1152 (1959) (Douglas, J., dissenting, joined by Warren, C.J., and Brennan, J.); Boehning v. Indiana State Employees Ass'n, 423 U.S. 6, 8, 96 S.Ct. 168, 170, 46 L.Ed.2d 148 (1975) (Douglas, J., dissenting), but that position has never commanded a majority of the court, and Pullman abstention remains applicable, see, e.g., Boehning, 423 U.S. at 6-8, 96 S.Ct. at 168-70 (per curiam).
This court has a duty under the narrow strictures of Pullman abstention, Railroad Commission of Texas v. Pullman, 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941), to maintain the comity and federalism fundamental to the Constitution by avoiding unnecessary friction with the state courts. See, e.g., Harrison v. NAACP, 360 U.S. 167, 176, 79 S.Ct. 1025, 1030, 3 L.Ed.2d 1152 (1959) (Harlan, J.). We also have a duty to avoid unnecessary constitutional adjudication. See, e.g., Ashwander v. Tennessee Valley Authority, 297 U.S. 288, 345-48, 56 S.Ct. 466, 482-83, 80 L.Ed. 688 (1936) (Brandeis, J., concurring).
The "paradigm of the `special circumstances'" that must exist before invoking Pullman's narrow exception to the exercise of federal jurisdiction is "a case where the challenged statute is susceptible of a construction by the state judiciary that would avoid or modify the necessity of reaching a constitutional question." Babbitt v. United Farm Workers National Union, 442 U.S. 289, 306, 99 S.Ct. 2301, 2313, 60 L.Ed.2d 895 (1979) (quoting with approval Kusper v. Pontikes, 414 U.S. 51, 54, 94 S.Ct. 303, 306, 38 L.Ed.2d 260 (1973)); see also Waldron v. McAtee, 723 F.2d 1348, 1352 (7th Cir. 1983); City Investing Co. v. Simcox, 633 F.2d 56, 60 (7th Cir. 1980).
This is such a case. No Illinois court has yet addressed the question of whether the challenged searches and Rules under which they were made were beyond the authority of the Act. The majority here and the district court below both appear to believe the Rules invalid for precisely that reason. If the Rules are invalid, the challenged searches, which exclusively relied upon the Rules, are all also invalid, and the case is concluded without constitutional adjudication. Every personal and residential search in this action was performed by agents of the Illinois Department of Law Enforcement ("IDLE"), to whom the Board had delegated the authority to enforce the Rules. On the record in this case, the agents of IDLE claimed only the authority of the Rules for every search challenged. No other authority is claimed in the record to justify these searches. Even the occupational licenses required of each worker to gain employment were conditioned upon signing a consent to searches under the authority of the Rules. While the attorneys argued other authority to this court in their briefs, those arguments are merely legal arguments constructed after the institution of litigation. The crux of the matter is that the facts established by the record do not support a plea to any authority except the Rules to justify these searches, and the litigants cannot inject extraneous issues into the case via the briefs. Given the exclusive reliance by the IDLE agents on the Rules, the validity of the Rules is the only issue properly before this court, and it may well be decided by state law.
Thus this case calls for abstention because the statute leaves "reasonable room for a construction by the [state] courts which might avoid in whole or in part the necessity for federal constitutional adjudication, or at least materially alter the problem." Harrison, 360 U.S. at 176, 79 S.Ct. at 1030; see also Boehning v. Indiana State Employees Association, 423 U.S. 6, 6-8, 96 S.Ct. 168, 168-70, 46 L.Ed.2d 148 (1975) (per curiam); Lynk v. LaPorte Superior Court No. 2, 789 F.2d 554, 568 (7th Cir. 1986).
In this case, the Illinois courts obviously might provide a limiting construction that would place the challenged searches beyond the Act, see Hawaii Housing Authority v. Midkiff, 467 U.S. 229, 104 S.Ct. 2321, 2327, 81 L.Ed.2d 186 (1984) (significant possibility of a limiting construction justifies abstention); Harrison, 360 U.S. at 176, 79 S.Ct. at 1030, 46 L.Ed.2d 148 (abstaining because of significant possibility of limiting construction); see also Lynk, 789 F.2d at 568, for the Act does not specifically or explicitly authorize either personal or residential searches. Such an interpretation of the Act would significantly alter, if not entirely moot, the constitutional question. The strong possibility of such a limiting construction should deter us from declaring the issue so clear that we will not first defer to a state court's interpretation of its own law. Cf. Kusper v. Pontikes, 414 U.S. 51, 94 S.Ct. 303, 38 L.Ed.2d 260 (1973) (abstention improper because state law not susceptible of an interpretation that might avoid constitutional adjudication); Harman v. Forssenius, 380 U.S. 528, 534-35, 85 S.Ct. 1177, 1182, 14 L.Ed.2d 50 (1965) (same); Board of Education v. Bisworth, 713 F.2d 1316, 1321 (7th Cir. 1983) (same).
It might be argued that it is inappropriate to order abstention at the appellate level when the issue was not raised below or suggested by the parties on appeal. But we have recently held otherwise. In Waldron v. McAtee, 723 F.2d 1348 (7th Cir. 1983), we held that "the court has the power and in an appropriate case the duty to order abstention, if necessary for the first time at the appellate level, even though no party is asking for it." Id. at 1351. Our duty is to the federalism inherent in the Constitution, and we are thereby bound to respect the sovereignty of the states and to avoid unnecessary constitutional adjudication.
We raised the potential applicability of abstention at the oral argument on appeal, and the parties then filed briefs on the issue at our request.
We recently held in Mazanec v. North Judson-San Pierre School Corp., 763 F.2d 845, 848 (7th Cir. 1985), that a trial court had abused its discretion by ordering abstention subsequent to the date trial was concluded, and three years after litigation was commenced. Mazanec itself distinguished Waldron by noting that in Waldron there was a significant possibility that the statute would be held unconstitutional as it stood, but that the state might "save" it by limiting it to pass constitutional muster. Id. at 848. The facts at bar are similar to Waldron; a state court's interpretation of the Rules and the Act might avoid the necessity of striking down a state law or regulation on constitutional grounds. Thus Waldron is the appropriate precedent to apply to the case at bar.
Procedural concerns bolster the argument for abstention in this case. The purpose of legal procedure is to expedite the full and frank consideration of substantive legal disputes. If the appellate courts do not order abstention where it is appropriate simply because it was not raised below, litigants will be encouraged to avoid abstention by excluding crucial state issues from their pleadings. Such a practice would place abstention largely in the hands of the litigants, and in many cases the individual goals of each litigant may counsel avoidance of abstention, thus obscuring and perhaps emasculating the interests of the sovereign states in the regulation of their own affairs. When a case presents issues meeting the threshold requirements necessary to invoke the narrow doctrine of Pullman abstention, the court may be the lone guardian of the state's sovereign place under the Constitution. We should not shirk that duty.
The majority suggests in a footnote that even if the Act does not authorize the challenged searches, we would still be required to reach the defendants' constitutional arguments based on the plaintiffs' consents to the searches. I do not agree. The Board conditioned the granting of employment licenses upon consent to the Rules, and the district court found that the employees' individual consents at the time of each search were given under the threat of dismissal based upon the authority of the Rules. The invalidation of the Rules would preclude any future search based upon consent to the Rules, and would prevent the use of consent forms requiring consent to such searches under the authority of the Rules. If the Rules no longer exist, searches may not be based on their authority.
It should also be noted that even with the Rules and consents invalidated, the plaintiffs would still have to show the trial court that they continued to meet the threshold requirements necessary to support an injunction. While the district court found that "in the absence of permanent injunction, they [the plaintiffs] will continue to have their houses and persons searched without a warrant," it apparently did not consider the effect invalidating the Rules would have on police behavior. It is pure speculation to posit that the agents of IDLE would continue these searches subsequent to the invalidation of the Rules; indeed, the agents conducted the personal and residential searches in the backstretch area only in reliance upon the validity of the Rules, as the record shows. There are no findings regarding this crucial point in the district court's opinion, and this silence highlights the fundamental weakness in the majority's opinion: the validity of the searches absent the Rules was not presented to the district court under the record in this case, and should not be at issue before this court.
The majority also contends that the invalidity of the Rules would not dispose of the defendants' constitutional argument based upon a reduced expectation of privacy due to pervasive government regulation of the horse racing industry. I disagree. The pleadings do not place this defense in issue except in reference to the validity of the Rules. Throughout this action, neither party has raised the argument that the searches were authorized in the absence of the Rules. While the parties may have intended or hoped to put such a theory into this case by their briefs to this court, the record here does not do so, and this court is not at liberty to resolve issues not presented by the record on appeal. In re Peter Bear, 789 F.2d 577, 579 (7th Cir. 1986); Johnson v. Levy Organization Development Co., 789 F.2d 601, 611 (7th Cir. 1986).
In their answer the defendants pleaded that sections 37-2 and 37-15 of the Act both independently authorized the Rules, even if section 37-9 did not. Defendants never again explicitly cited, argued, or relied upon the putative authority provided by these sections, and plaintiffs only cursorily argued their insufficiency in authorizing the Rules. More importantly, the district court appears to have decided that the two sections were not at issue, or that the arguments based upon them were so frivolous as to not even require comment, for the court made no mention of them in its opinion. Whatever the statutory or constitutional merits of arguments based upon these sections, they are still framed to authorize the Rules, not to directly authorize searches in the absence of the Rules. Thus their invocation does not affect the focus of this dissent, which is that the validity of the Rules under state law is a crucial question whose resolution will significantly alter or entirely moot the constitutional issues in this case.
The defendants did raise an affirmative defense that "warrantless searches and seizures and investigatory stops of occupational licensees within the race track enclosure do not violate the Fourth Amendment to the United States Constitution since horse racing licensees have notice of the likelihood of warrantless searches by the pervasiveness of regulation and by the long history of governmental regulation of this business." (Citations omitted.) However, defendants did not explicitly make clear whether "pervasiveness of regulation" in this defense included the challenged Rules, and the ubiquitous reliance upon the Rules throughout the rest of the defendants' pleadings and briefs strongly suggest that this defense also relied upon the validity of the Rules. Surely defendants would have explicitly announced any claims they believed authorized the searches in the absence of the Rules.
Nevertheless, the majority today has gone beyond state law unnecessarily and has decided a constitutional issue not presented to the court. With all due respect, such a decision is ill-advised. My concern is not merely technical; while the parties have addressed themselves to the constitutional requirements necessary to authorize a search under a particular legislative scheme detailing requirements for such searches, the parties have not directly confronted the constitutionality of such searches made without explicit statutory guidelines, probable cause, or reasonable suspicion in a pervasively regulated industry. This court should not rule upon the issue until a case presents it and does so without also presenting a potentially dispositive and uncertain issue of state law. Otherwise, the court suffers the absence of the sharp definition of issues and exhaustive consideration of legal argument such a case would provide. The case presented to us turns on an unclear issue of state law whose resolution may obviate and would almost certainly significantly alter the need for constitutional adjudication. I would abstain.