C. POLICY CONSIDERATIONS
Expanding federal and state law to prohibit racial discrimination in retail settings raises three important policy problems. First, there is a high risk that creating a cause of action for shoppers who feel offended in retail stores would open the floodgates of litigation and lead to a plethora of meritless lawsuits. Second, any law controlling the behavior of private actors is suspect as a violation of their right to personal autonomy, regardless of whether they are individuals or corporations. Third, laws prohibiting racial discrimination may ultimately cause perverse results and lead to a greater focus on race since store employees must go out of their way to acknowledge race in order to avoid the appearance of differential treatment.
The Supreme Court, in Domino's v. McDonald, listed excessive litigation as a primary reason not to expand § 1981 beyond specific contracts under which the complaining party had rights. Justice Scalia stated that such an expansion “would produce satellite litigation of immense scope.” Extensive satellite litigation is a fear because applying § 1981 to cases where discrimination does not block the formation of a contract would make it far more difficult to eliminate meritless cases before trial. If shopping in a retail store is sufficient to satisfy the third prong of § 1981 analysis, then the only option for dismissing cases without merit is either the shopper not showing intent or the shopper not showing discrimination. Since evidence of other actions by store employees can stand in for direct evidence of intent, the intent prong is unlikely to be an effective tool for weeding out meritless cases. The only remaining option is finding that the shopper has not proven discrimination. Under the current standard, a shopper who presents evidence that she was treated poorly while shopping, and claims that it was because of her race, has stated sufficient evidence to get to trial, as credibility determinations are the province of the jury.
The solution to this problem is not to continue arbitrarily limiting “phases and incidents” of the contractual relationship to just the actual formation of the contract. If the concern is truly that shoppers who have not experienced discrimination will bring frivolous claims, then the solution is to more aggressively dismiss cases where there is a lack of evidentiary support to show that black shoppers were treated differently from white shoppers on account of their race. Thus, courts should simultaneously also create a stricter evidentiary standard by requiring shoppers bringing a § 1981 claim to actually show that (1) they were treated poorly, (2) they were treated in a way different from white shoppers, and (3) a reasonable person could find such differential treatment to be because of the shopper's race. Such a requirement would balance the new protections offered in retail stores and would make it more difficult for frivolous claims to get to trial, while still allowing shoppers who have experienced legitimate discrimination to get relief.
As an example, to look further into the case of Crystal Gregory, her claim was ultimately correctly dismissed, but not because she was not denied the ability to enter into a contract, but because there was no evidence that anything the store employees did was unreasonable or race-based. Gregory based her claims on the rude “snicker” of the employee and the fact that there were security guards nearby. It is unreasonable to assume that such a rude ““snicker,” in the absence of any other evidence, was based on racial animosity. After all, neither federal nor state anti-discrimination law is designed to ensure that shoppers are treated politely, merely that they are treated equally. Furthermore, stores are well within their rights to have security guards to monitor activities, and Gregory did not present any evidence that the guards were called because of her and because of her race Dismissing Gregory's claim because she was not prohibited from making a contract disregards the impact that racial discrimination can have on an individual during the contract formation process. Dismissing her claim because there is no interpretation of her facts that could amount to discrimination acknowledges the impact of discrimination while still protecting retailers from frivolous litigation.
The second concern is that regulating the behavior of private actors is something that lawmakers should avoid whenever possible. Retail stores, after all, are private actors who exist in a free market. If shoppers feel unwelcome in a particular store, they are free to either shop elsewhere or even purchase items online. Adding further regulation to private stores decreases their ability to function profitably and creates federal and state controls over private action that are not necessary.
This concern, however, is not applicable to public accommodation laws and retail stores for two reasons. First, there is already a national policy in place to eliminate racial discrimination, and § 1981 was crafted to further that policy. Second, the limitations that § 1981 and state public accommodation laws place on retail stores are minimal. These statutes do not require stores to provide special treatment for minority shoppers, or to enact costly renovations or programs. They merely require that stores treat everyone who enters them in an equal way. Retail stores like Dillard's are already aware of how they treat white shoppers. Applying § 1981 and state public accommodation laws to retail stores will only require that the stores treat black shoppers the same. The only difficulty with this approach would arise when a store is located in an area where, statistically, a minority group commits substantially more shoplifting or vandalism than white citizens. However, anti-discrimination statutes do not affect a store's ability to respond to minority shoppers who are actually shoplifters, they only prohibit the stores from treating all minority shoppers like they are shoplifters.
The third policy concern is that applying anti-discrimination laws to retail stores would lead to perverse results and cause a greater focus on shoppers' race. This concern arises where everyone in a retail store is covered under § 1981 and a state public accommodation statute; in that case, the store is in quite the bind. If a store security officer legitimately suspects a black shopper of shoplifting and is incorrect, he is faced with a potential § 1981 suit. The shopper would claim that the only reason he was followed was his race, while the officer and the store would claim other reasons for surveillance. If properly pleaded, this could lead to trial, which is both costly and could negatively impact the store's public image. Thus stores will need to implement new training practices for their employees regarding proper customer treatment, which may also be costly. It is even possible that such a series of events would force store employees to approach all minority shoppers with trepidation, and shoppers will only be further distinguished by their race.
The solution to this problem is similar to that of the frivolous litigation problem. If courts are more willing to dismiss cases where the facts merely indicate unsatisfactory treatment of a black shopper, as opposed to actual discrimination, then stores need not treat black shoppers delicately. As Judge Colloton pointed out in his dissent in Gregory v. Dillard's, providing anti-discrimination protection in retail stores does not give aggrieved customers carte blanche to prevail in every suit. Rather, if courts require that plaintiffs show that they are actually treated in a manner that “rises to the level of severe or pervasive harassment,” or in a “markedly hostile manner and in a manner which a reasonable person would find objectively discriminatory,” then there would be a firm barrier to suits lacking merit. Minority shoppers who are merely offended by non-racially based, rude conduct would simply have to endure what everyone, regardless of race, has to suffer through at some point: bad service. Retail stores would be able to treat black and white shoppers the same without fear of frivolous suits, as such claims would fail to meet the stricter reasonableness test and evidentiary bars in court.
