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7th Circuit Court SealDunnet Bay Constr. Co. v. Borggren, No. 14-1493 (7th Cir. 2015)

Dunnet was a highway construction company prequalified to bid and work on Illinois Dept. of Transportation (IDoT) projects and compete for Federally highway contracts that was owned by two white males.

Dunnet, whose average annual receipts were over $52 Million, wanted to be considered a “disadvantaged business enterprise” (DBE) in order to compete for certain jobs. However, the government defines a DBE as a small entity that is owned at least 51% by, and controlled by, so-called “socially and economically disadvantaged individuals” (ie: women and minorities).  A DBE must also have annual receipts of $22.41 Million or less.

Despite the fact that “disadvantaged business” and a “disadvantaged individual” refers to women and minorities, an owner of any race or gender may seek a “waiver.” Dunnet sought but was denied a waiver. As a result, Dunnet brought a discrimination suit claiming that the denial was a violation of its equal protection rights under the Constitution.

The District Court entered Summary Judgment against it and Dunnet appealed. The Seventh Circuit affirmed the summary judgment rejecting Dunnet’s claim that IDoT’s DBE Program discriminates on the basis of race. In fact the Court concluded that Dunnet lacked standing to raise an equal protection challenge based on race and that the Program survived constitutional scrutiny as well as the other challenges raised by Dunnet’s claims.

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