Facts
- Michael A. Lebron, an artist, sought to rent a prominent illuminated billboard in New York’s Penn Station owned by the National Railroad Passenger Corporation (Amtrak) and managed through an advertising contractor.
- Lebron’s contract provided that proposed advertising copy was subject to approval by both the contractor and Amtrak.
- Lebron submitted a political advertisement criticizing Coors Brewing Company and the Coors family’s support of conservative causes.
- An Amtrak vice president rejected the advertisement under Amtrak’s policy barring political advertising on that billboard.
- Lebron sued, alleging that the refusal violated his First Amendment and Fifth Amendment rights.
- The district court held Amtrak was a government actor for First Amendment purposes and ordered the advertisement displayed.
- The Second Circuit reversed, reasoning that Amtrak was not a governmental entity, relying in part on statutory language stating Amtrak “is not a department, agency, or instrumentality of the United States Government.”
- The Supreme Court granted review to determine Amtrak’s constitutional status for First Amendment purposes.
Issues
- Whether Amtrak is part of the federal government for First Amendment purposes when it was created by federal statute to achieve governmental objectives and the President appoints a majority of its directors.
- Whether the Court could consider the contention that Amtrak is itself part of the Government where the petitioner had advanced different characterizations below.
- If Amtrak is a government actor, whether its rejection of the proposed advertisement violated the First Amendment (scope of review and disposition).
Decision
- The Supreme Court reversed the Second Circuit and remanded.
- The Court held that Amtrak is a government actor for purposes of the First Amendment.
- The Court concluded it could consider the “Amtrak is part of the Government” contention as a new argument supporting a preserved First Amendment claim, not a new claim.
- The Court did not finally resolve whether the specific advertising rejection was unconstitutional; it remanded for further proceedings consistent with Amtrak’s status as a governmental actor.
Legal Principles
- When the Government creates a corporation by special law to further governmental objectives and retains permanent authority to appoint a majority of its directors, the corporation is part of the Government for First Amendment purposes.
- Congressional statutory labels declaring an entity “not” a federal agency do not control the constitutional inquiry where the entity’s structure and federal control demonstrate governmental status.
- The Constitution cannot be avoided by conducting governmental functions through a federally created and federally controlled corporate form.
- A party may press a new legal theory or argument in support of a preserved claim where it is fairly included in the question presented and addressed in the proceedings below.
Conclusion
The Court held that Amtrak is a governmental actor subject to First Amendment constraints because it was created by federal law to pursue governmental objectives and remains under ongoing federal control through presidential appointment of most directors, and it remanded for evaluation of the challenged advertising decision under constitutional standards.