by Margo Schlanger, University of Chicago Law Review Online, March 5, 2021

I. Introduction

Kamyar Samimi, a sixty-four-year-old legal permanent resident from Iran, died in U.S. immigration detention in December 2017. After more than four decades in the United States, he’d been confined at the Aurora Contract Detention Facility, a large immigration detention facility near Denver privately operated under a contract between U.S. Immigration and Customs Enforcement (ICE) and the GEO Group.

Samimi had taken methadone for twenty-five years, but facility medical staff cut him off and then, according to his family’s subsequent lawsuit, failed to treat his acute withdrawal despite his increasingly desperate pleas.² His family alleges that it took just two weeks of neglect for him to die³ — the first of ten deaths of ICE detainees in fiscal year 2018.

The lawsuit against GEO is currently in discovery. It seeks damages for negligence and violation of Section 504 of the Rehabilitation Act of 1973, which forbids disability discrimination in federal programs such as ICE detention. It alleges that GEO’s failure to accommodate Samimi’s disability — opioid use disorder — led to his inability to access mental health care, food, and water, and therefore violated the Act. The complaint explains that (among other reasons) GEO is an appropriate defendant because it “operated a program or activity for ICE.”

The theory is novel, but I argue in this Essay that it is sound — that Section 504 authorizes lawsuits and damages awards against private firms that commit disability discrimination in administering federal programs. The availability of damages partially fills in a remedial gap created by the federal government’s own sovereign immunity from damages.

Although the argument applies somewhat more broadly, it solves a particularly urgent problem with respect to federal incarceration. The federal government is by far the nation’s largest incarcerator, with three large systems run by three separate agencies: the Bureau of Prisons, the United States Marshals Service, and ICE.⁴

Each outsources much of its operations. Table 1 offers a snapshot of daily population and operational outsourcing as of 2019.⁵ In total that year, these three federal agencies outsourced incarceration of nearly 125,000 people on any given day, over half to facilities operated by private firms.

In the waning days of the Obama administration, the Department of Justice pledged to reduce the Bureau of Prisons’ use of privately operated prisons. The pledge was a limited one, and did not cover either the U.S. Marshals Service or ICE detention. And the Trump administration quickly reversed course. The Biden campaign promised to “end the federal government’s use of private prisons,” and opined that “the federal government should not use private facilities for any detention, including detention of undocumented immigrants.”

The Biden administration has followed through on that promise, in part, issuing an Executive Order that forbids the Attorney General to “renew Department of Justice contracts with privately operated criminal detention facilities, as consistent with applicable law.” Progress implementing this order is likely to be slow, particularly for the Marshals Service, where implementation will require significant operational changes. And the challenges are even greater, for the order does not reach ICE detention, which so far has not been instructed to shift its contracting approach.

In the meantime, the disability remedial gap remains important. Over half the people incarcerated in American prisons and jails have disabilities.⁸ There are no disability statistics available for the particular slices of the incarcerated population covered by Table 1 — but of the many outsourced prisoners/detainees, there is every reason to think that thousands and thousands have disabilities.⁹ And as the Samimi case demonstrates, the stakes can be very high. If their disabilities are not met with the accommodations Section 504 requires, disability discrimination can extend incarceration, undermine the fairness of judicial proceedings, and impose acute medical problems.¹⁰ Recognizing the availability of damages for violations of Section 504 by private contractors who operate federal detention facilities would both deter and remedy these consequences.

II. Federally Conducted Programs and the Disability Discrimination Remedial Gap

Since 1973, Section 504 of the Rehabilitation Act has protected people with disabilities from discrimination in (1) federally assisted or (2) federally conducted programs:

“No otherwise qualified individual with a disability in the United States, … shall, solely by reason of his or her disability, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance or under any program or activity conducted by any Executive agency.”

It’s an unusual statute. Mostly, the antidiscrimination requirements that govern the federal government’s own (non-employment) activities are based on constitutional law¹¹ or executive orders,¹² not statutes.¹³

But whether the substantive requirements are imposed by the Constitution, an executive order, or a statute, most of them share a remedial gap: victims’ inability to get damages, even when no other remedy is suitable. For constitutional claims, the Supreme Court’s recent skepticism about inferred causes of action forecloses damages claims against the responsible federal actors (including federal contractors).

Executive orders are generally not enforceable by damages actions.¹⁴ While the Supreme Court recently held that damages are available for federal officials’ religious discrimination that violates the Religious Freedom Restoration Act, that’s not the situation under other antidiscrimination statutes that reach federal programs.¹⁵ And in particular, in Lane v. Peña (1996), the Supreme Court held that the Rehabilitation Act did not waive the federal government’s sovereign immunity against money damages.

However, the Rehabilitation Act’s remedial gap is narrowed when federal programs and activities are outsourced. The reason is that when the federal government outsources its programs, victims of disability discrimination can seek damages if the contractor is itself covered — without reference to the contract — by the Americans with Disabilities Act and/or the Rehabilitation Act.

This occurs when the contractor is a state or local government and therefore within the scope of the ADA’s Title II, or when the contractor is also a recipient of federal financial assistance, and therefore separately covered by the Rehabilitation Act.¹⁶ (The contractor may also be covered by ADA Title III, which authorizes injunctive relief but not damages.¹⁷)

But what if a person with a disability is harmed by discrimination by a private federal government contractor (that is, one not covered by Title II) that does not otherwise receive federal financial assistance? A claim for damages against the federal government under Section 504 is defeated by sovereign immunity, under Lane v. Peña. And a claim for damages against the private contractor as a recipient of federal financial assistance is unavailable because, as discussed further below, payments made pursuant to procurement contractors are not generally considered federal financial assistance.

In this essay, I argue Section 504 creates an additional avenue for damages liability to remedy discrimination in federally conducted programs that are outsourced. The argument has two steps: Step One: The statute imposes liability for discrimination “under” federally conducted programs but does not so much as hint that the only appropriate defendant is the federal government itself.

In the absence of such a statutory limit, contractor firms that run federal programs are appropriate defendants. The argument is primarily textual, following from two aspects of the statute: First, Congress framed Section 504 in terms of the protection provided to individuals with disabilities seeking equal access to federally assisted or conducted programs — that is, in terms of the plaintiffs rather than the defendants. Second, Congress described the scope of Section 504’s coverage as discrimination “under” federal programs, not discrimination “by” federal officials. And Step Two: Contractors are not protected by sovereign (or other governmental) immunities, so damages liability is available against them.

There is nothing anomalous about either of these steps. It is routine and noncontroversial for causes of action to cover only governmental activity but to allow non-governmental defendants. And it is likewise routine to hold a federal contractor liable in damages in a situation in which the federal agency does not face a damages threat.

III. What Is Already Clear
About Section 504?

A.   Section 504’s Coverage of Outsourced Programs

It’s clear that Section 504 substantively covers outsourced programs. First, there’s the language of Section 504 itself, which protects individuals with disabilities from discrimination “under any program or activity conducted by any Executive agency,” without limiting the programs to the non-outsourced.

Second, applicable regulations make clear that federal agencies’ obligations extend to outsourced programs. As the Justice Department explained in promulgating the lead regulation (the model for other agencies’ regulations), “a federally conducted program or activity is, in simple terms, anything a Federal agency does.” Accordingly, the regulations bar disability discrimination by “[t]he agency, in providing any aid, benefit, or service, may not directly or through contractual, licensing, or other arrangements.”¹⁸

Non-regulation sources agree. For example, in a June 2016 publication titled Component Self-Evaluation and Planning Reference Guide, whose purpose was to “assist DHS Components in their efforts to strengthen compliance with Section 504 of the Rehabilitation Act of 1973,” DHS wrote, “A Component’s activities carried out through contracts are considered conducted activities and are subject to the same obligations.” It explained:

“There are two major categories of federally conducted programs or activities covered by Section 504: those involving general public contact as part of ongoing agency operations and those directly administered by the agency for program beneficiaries and participants. Activities in the first category include communication with the public (telephone contacts, office walk-ins, or interviews) and the public’s use of the agency’s facilities (libraries, cafeterias, or auditoriums).”

Activities in the second category include programs that provide federal services or benefits. Examples include immigration and naturalization benefits, federal disaster services, airport security screening, federal building security screening, protective security at major events, customs activities, border protection activities, and enforcement of immigration laws and operation of immigration detention facilities.

Conceptually, this is analogous to the clear rule governing state and local anti-discrimination compliance under ADA Title II. The Title II regulation is precisely the same as the Section 504 federally conducted regulation. Both reach the government entity’s action “directly or through contractual, licensing, or other arrangements.”¹⁹ Thus the explanatory material available with respect to Title II can appropriately be mined for insight into Section 504 federally conducted coverage. On Title II, when the ADA’s regulations were amended in 2010 to add provisions specifically requiring physical and program access in correctional facilities, the DOJ explained particularly:

The Department is aware that some public entities are confused about the applicability of the title II requirements to correctional facilities built or run by other public entities or private entities. It has consistently been the Department’s position that title II requirements apply to correctional facilities used by State or local government entities, irrespective of whether the public entity contracts with another public or private entity to build or run the correctional facility. The power to incarcerate citizens rests with the State or local government, not a private entity.

Similarly, frequently quoted DOJ guidance about ADA Title II states,

All governmental activities of public entities are covered, even if they are carried out by contractors. For example, a State is obligated by title II to ensure that the services, programs, and activities of a State park inn operated under contract by a private entity are in compliance with title II’s requirements.

Title II case law uniformly agrees. To quote the Ninth Circuit, “The law is clear — the State Defendants may not contract away their obligation to comply with federal discrimination laws”; “Title II’s obligations apply to public entities regardless of how those entities chose to provide or operate their programs and benefits.”²⁰ Accordingly, Title II imposes liability — including damages liability — on state and local governments for ADA violations they commit directly or for violations their contractors commit. In turn, the governmental entity may be able, under state law, to recover some portion of damages assessed from its contractor.²¹ Analogously, as courts have recognized, Section 504’s coverage extends to contracted as well as directly administered federal programs.²²

B.   No Damages Against the Federal Government: Lane v. Peña

However, the remedies under Section 504’s federally conducted coverage diverge from those applicable to ADA Title II, because no damages are available against the federal government. In Lane v. Peña, the Court examined the remedial provision of the Rehabilitation Act, Section 505(a)(2), which provides in pertinent part:

“The remedies, procedures, and rights set forth in title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.) (and in subsection (e)(3) of section 706 of such Act (42 U.S.C. 2000e–5), applied to claims of discrimination in compensation) shall be available to any person aggrieved by any act or failure to act by any recipient of Federal assistance or Federal provider of such assistance under section 794 of this title.”

Because damages are available under Title VI, the Court held that the section makes them available as well for discrimination in federally assisted programs — that is, programs supported by federal grants. But the statute does not waive the federal government’s sovereign immunity for “program[s] or activit[ies] conducted by any Executive agency,” usually referred to as “federally conducted” programs.

The Court took as given that lawsuits demonstrating federal agency disability discrimination in federally conducted programs could justify injunctive relief — and even accepted that damages would be appropriate, absent sovereign immunity. But it emphasized “the crucial point that, when it comes to an award of money damages, sovereign immunity places the Federal Government on an entirely different footing than private parties.”

It quoted the government’s brief with approval: “[w]here a cause of action is authorized against the federal government, the available remedies are not those that are ‘appropriate,’ but only those for which sovereign immunity has been expressly waived.” No such express waiver for the federal government’s federally conducted activity meant no damages.

In an injunctive case, sovereign immunity does not pose any remedial difficulty: on the proper showing, the federal government can be required to cure the violation in question.²³ But what if the remedy is unavoidably monetary? For example, what if the discrimination killed its victim? That’s the damages remedial gap.

C.   The Availability of Damages Against Some Outsourced Federal Programs

The damages remedial gap — even if constitutionally tolerable under Lane v. Peña — is only partial. When the federal government outsources its programs, the contracting entity or the contracted activity may be otherwise covered as well by other parts of the Rehabilitation Act or the ADA.

For example, suppose a federal agency contracts with a county or a sheriff’s department to house federal detainees in a local jail. The local government contractor is covered by ADA Title II, because it is a “public entity.”

Moreover, given the federal government’s extensive criminal justice grant programs, the jail is likely subject to Section 504’s federally assisted coverage — which affects not only the program for which federal financial assistance is provided, but “all of the operations of” entities that accept such assistance.²⁴ (A procurement contract itself does not, however, constitute federal financial assistance.)

In short, notwithstanding Lane v. Peña, much of the federal government’s outsourced activity is susceptible to damages liability for disability discrimination because of (a) the status of the contractor as a public entity, (b) the status of the contractor as a recipient of federal financial assistance

Moreover, a private contractor — including one that has not accepted any federal financial assistance — may well be covered by the ADA’s Title III, which bars disability discrimination with respect to “goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation.”

For example, the Department of Justice explained (in the same guidance already quoted) that not only is a state park inn covered by ADA Title II, but in addition, a private company operating the inn under state contract “would also be subject to the obligations of public accommodations under title III of the Act and the Department’s title III regulations at 28 CFR part 36.”

ADA Title III’s coverage is expansive enough to encompass many of the types of programs that might be contracted out by federal agencies.²⁵ (That said, Title III does not authorize damages liability. So it potentially provides an additional defendant based on the nature of the discriminatory activity and its connection to a place of public accommodation, but does not solve the damages remedial gap.)

IV. The New Argument: Section 504 Liability Extends to Federal Contractors Because They Are Administering a Federal Program

The purpose of this Essay is to explain that the Rehabilitation Act also authorizes another route around the remedial gap opened by Lane v. Peña — that victims of disability discrimination can seek damages from private federal contractors, who are unprotected by governmental immunities, if those private contractors administer federal programs. To be clear, the argument is a limited one. Not every federal contractor is an appropriate Section 504 defendant — only those who are responsible for administering a federal program.²⁶

A. Federal Contractors Are Appropriate Defendants

Many statutes regulate particular defendants, imposing duties on them. The Rehabilitation Act instead focuses on who it protects and the extent of that protection. It offers any “otherwise qualified individual with a disability” protection against unfair exclusion, denial of benefits, and discrimination “under any program or activity receiving Federal financial assistance or under any program or activity conducted by any Executive agency.”

The Supreme Court has emphasized that this kind of language — “text … ‘phrased in terms of the persons benefited’” rather than text “that create[s] duties on the part of persons for the benefit of the public at large”—indicates congressional intent to create a private cause of action. Here, the statutory language indicates that the cause of action covers federally assisted or federally conducted programs.

But it does not limit the appropriate defendants to federal agencies.

Indeed, if the statute contained such a limit, that would logically apply both to federally assisted and federally conducted programs. After all, the statutory text is identical with respect to both, barring discrimination “under any program or activity receiving Federal financial assistance or under any program or activity conducted by any Executive agency.”

But long-settled case law demonstrates that actions for discrimination in federally assisted programs proceed directly against the recipients of federal financial assistance, not against the federal funder.²⁷ Likewise, properly understood (even if so far unrecognized in case law), Section 504 by its plain text authorizes a direct suit against a contractor who administers a federal program by a victim of that contractor’s discrimination.

There is nothing odd about a lawsuit against a non-governmental actor premised on its governmental role. Indeed, civil rights cases routinely attach liability to persons because they carry out governmental programs, even though the defendants themselves are not governmental entities.

Most salient, Section 1983 and Bivens both attach liability to individuals, even though the nature of the violation requires governmental action. And in West v. Atkins, the Supreme Court made clear that government contractors, as well as employees, can be defendants in cases where the legal obligations in question depend on the existence of governmental action.

Moreover, just as (I have argued) under Section 504 plaintiffs could sue the federal government (for injunctive relief) and a contractor, the West Court held that the possibility of a lawsuit against a federal contractor leaves in place the state’s own affirmative constitutional obligations: “Contracting out prison medical care does not relieve the State of its constitutional duty to provide adequate medical treatment to those in its custody.”

Similarly, several district courts have held that private prisons may be liable for violations of the Religious Land Use and Institutionalized Persons Act (RLUIPA). They point out that RLUIPA is intended to protect the religious exercise of people incarcerated in “institutions,” and “institutions” include private prisons. Given that substantive coverage, they reason, private prisons should be counted as an “instrumentality” of the state, and therefore an appropriate defendant.²⁸

Section 504 liability for private actors who administer federal programs fits easily into this existing civil rights landscape.

B.   No Sovereign Immunity

Could a private actor administering a federal program be liable for money damages, notwithstanding potential governmental sovereign immunity from damages? Yes. Federal contractors often seek to assert governmental immunities; the case law is clear that these efforts are unavailing. The on-all-fours case is Campbell-Ewald Co. v. Gomez, in which the Supreme Court declined the requested “derivative” sovereign immunity for a private contractor who had “violate[d] both federal law and the Government’s explicit instructions.”

This result lines up with Richardson v. McKnight, in which the Supreme Court declined to protect a private prison corporation with public qualified immunity.²⁹

C.   But What About …

So far as I know, no court has either accepted or rejected the interpretation of Section 504 that allows lawsuits against private contractors who administer federal programs. Three lines of precedent seem relevant, each holding against civil rights plaintiffs. But even if each is correct, none poses a serious challenge to the theory of liability just presented.

1.   Federal procurement contracts are not federal financial assistance.

Section 504 regulations uniformly state that procurement contracts do not constitute federal financial assistance; numerous opinions deny liability against private federal contractors on this basis. This has no bearing on whether a contract under which a private entity administers a federal program renders that entity potentially liable not because the program is federally assisted but because it is federally conducted—that is, because the discrimination occurs “under [a] program or activity conducted by any Executive agency.”

2.   Only “public entities” are appropriate defendants under ADA Title II.

Numerous courts have held that only “public entities” are appropriate defendants under ADA Title II—and concomitantly, that individual capacity lawsuits are not available and that private prison companies are not public entities.

Courts have rested their conclusion that ADA Title II does not authorize individual capacity lawsuits chiefly on Title II’s language. Recall, Title II requires that individuals with disabilities not “by reason of such disability, be excluded from participation in or be denied the benefits of services, programs, or activities of a public entity, or be subjected to discrimination by any such entity.”

In one of the few cases providing any analysis, the Eighth Circuit explained: “Title II provides disabled individuals redress for discrimination by a ‘public entity.’ See 42 U.S.C. § 12132. That term, as it is defined within the statute, does not include individuals. See 42 U.S.C. § 12131(1).” Or, slightly more generally but still focused on statutory text, the Seventh Circuit reached the same conclusion because “the ADA addresses its rules to employers, places of public accommodation, and other organizations, not to the employees or managers of these organizations.”

In fact, Title II’s language does not cover only discrimination “by” public entities. Textually, it is broader, reaching conduct that causes people with disabilities to “excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity.”

But even accepting the Title II case law, the Rehabilitation Act’s language is dispositively different. As already emphasized, it reaches disability-related exclusions, denials, and discrimination “under any program or activity conducted by any Executive agency.” The phrase “by any Executive agency” modifies “program or activity,” not “excluded from the participation in, … denied the benefits of, or … subjected to discrimination.” This linguistic difference must be given effect.

3.   Private prisons are not “public entities” under ADA Title II.

The courts have also held that governmental procurement contracts do not render contractors “public entities” under ADA Title II—and have therefore dismissed ADA lawsuits against those private contractors.³⁰ The most cited of these opinions, Edison v. Douberly (11th Cir. 2010), devoted considerable attention to rejecting plaintiffs’ argument that a private prison constituted a public entity because it functioned as an “instrumentality of a State.”

The court accepted as given that “only public entities are liable for violations of Title II of the ADA.” (A dissent argued that private prisons were “public entities” because of their function, not because of their status as government contracting partners.)

Again, these cases address a different theory under a different statute—whether a contractor is a public entity under ADA Title II. The argument presented here is, rather, that a contractor administering a federal program who violates the rights of individuals with disabilities “under” that program is an appropriate Rehabilitation Act defendant.

Conclusion

A rich literature establishes that privatization can threaten public values and urges substantive and procedural safeguards to minimize the threat.³¹ Substantively, it is clear that outsourced federal programs are covered by Section 504 because they are federal. The Rehabilitation Act requires that private contractors who operate the programs be accountable to people with disabilities for violations of their rights. 

Margo Schlanger is the Wade H. and Dores M. McCree Collegiate Professor of Law at the University of Michigan. Copyright © 2021 Margo Schlanger.

For article and footnote links, see https://lawreviewblog.uchicago.edu/2021/03/05/schlanger-detention/

This article was originally published March 5, 2021, on The University of Chicago Law Review Online; reprinted with permission.