Where by its inaction, a state agency, and through it the state, makes itself a party to a refusal of service, and elects to place its power, property and prestige behind admitted discrimination, it thereby insinuates itself into a position of interdependence with the wrongdoer such that it must be recognized as a joint participant in the challenged activity, which, on that account, cannot be considered to have been so "purely private" as to fall without the scope of the Fourteenth Amendment.
A restaurant refused to serve appellant food or drink solely because he was African-American. The restaurant leased space in a building owned by respondent (city parking authority). Appellant sought review of a judgment of the Supreme Court of Delaware that held that there was no violation of the Equal Protection Clause, U.S. Const. amend. XIV, § 1, when appellee restaurant, which was located in a public parking garage, refused to serve appellant based on his race because the operation of the restaurant did not involve state action.
If a restaurant leasing space in a building owned by a parking authority created by the state legislature refuses to serve a customer based on race, is there state action significant enough to permit an action under the Equal Protection Clause?
The U.S. Supreme Court reversed the state supreme court and held there was a violation of the Equal Protection Clause, U.S. Const. amend. XIV, § 1, when the restaurant refused to serve an individual based on his race on the theory that it was a purely private action. The parking authority was created by the state legislature and given broad powers. Respondent had determined that it would be necessary to lease space in the parking garages to generate income. Public funds paid for the upkeep and repairs of the leased space. The restaurant benefited from respondent's tax exempt status for building improvements. The Court held that, given these facts, and the ultimate conclusion that the restaurant was an integral part of a public building, there was sufficient state participation and involvement to constitute a violation of the Equal Protection Clause. Specifically defining the limits of its decision to the facts of the case, the court reversed the judgment and remanded for further proceedings.