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Derailing Affirmative Action

Brett Amole

Shortly before nine in the evening, with just a trace of light left in the sky, several Adarand Constructors trucks stand in the left lane of Interstate 25 north of Monument Hill. A dozen workers -- evenly split between whites and Hispanics, and all wearing safety vests, goggles, hardhats and boots -- set up their floodlights, which illuminate a quarter-mile stretch of road with the intensity found at a sports stadium.

Moments later, Adarand owner Randy Pech -- a 47-year-old in khakis, a burgundy polo shirt and loafers -- arrives to visit the troops. Although his foreman will oversee the actual labor, Pech shakes hands with the men. He then consults with the crew boss, who tells Pech that one guy brought his cell phone. "They're here to work, not talk to their girlfriends," Pech says, ordering his foreman to pass the message along.

Over the next month, the Adarand crews will install a 20,000-foot stretch of guardrail along this portion of the highway, where a wide, shallow grass ditch separates the northbound and southbound lanes and drivers often make ill-advised U-turns. On a good night, the team can install 1,000 feet of steel. They rely on a post-driver -- a giant hammering machine mounted on the back of a truck -- that starts with a whine and a billow of smoke. Workers lay out the posts in six-foot, three-inch intervals, and then an operator positions the pile-driver over one six-foot steel shaft after another. The clanging hammer sinks each post into the ground with four or five blows. Once the posts are in place, workers fasten small wood blocks to either side, then bolt the guardrails to the uprights with heavy pneumatic air wrenches. Afterward, the post-driver operator will check out the newly installed guardrail to make sure it's properly aligned.

Pech used to be at the helm of the big post-pounding machine, working into the early hours as deafening traffic roared by. But now, after fifteen minutes on the job site, he's satisfied and heads his Pontiac Bonneville back home toward Colorado Springs. He doesn't miss the work, he says, "not in the slightest."

Though low-key in appearance, Pech is a successful businessman. The 25-year-old Adarand has done nearly $26 million in guardrail business in the state since 1991, more than any other Colorado guardrail company during the same period. Yet Pech sees himself as a victim of discrimination by the federal and state governments, and for over a decade he's been seeking to overturn affirmative- action programs.

His crusade began in 1989, after his low bid on a federal contract was rejected in favor of one from another company, Gonzales Construction of Dolores. Gonzales, a Hispanic-owned firm, was awarded the job under an affirmative-action program overseen by the U.S. Department of Transportation. Pech, who is white, sued the federal transportation department in 1990, claiming the program was unconstitutional. This fall, the U.S. Supreme Court will consider Pech's complaint for the third -- and probably the last -- time.

If the justices rule in his favor, they could upset more than a generation of governmental attempts to reverse the effects of discrimination.


When George Pech, an ex-welder, called his son one day in 1976 and asked if he wanted to help start a guardrail company, the timing was perfect. The younger Pech had reached a crossroads at the University of Northern Colorado, where he was studying to become a gym teacher; he was ambivalent about being in front of a class full of kids, a senior-year requirement. So Pech, who had never before thought about building guardrails, told his father he was in. "It sounded good to me," he says.

Pech dropped out of UNC and went home to Colorado Springs to help with Adarand Constructors. (The name was a play on the younger Pech's first name and the last name of another founder, Tom Adams.) George Pech put up his retirement savings as collateral. Four banks turned down the fledgling company's requests for a loan -- even though a friend served on one bank board -- before a fifth loaned the Pechs $50,000.

The elder Pech soon turned the reins over to his son, and after Adams left, Adarand became a one-man show. Randy Pech struggled to learn the ins and outs of his new profession as he bid on jobs at night and ran them during the day, employing a single crew. At the time, Adarand had one pickup, one trailer and one post-driver. The novice businessman almost went broke on his first job, installing rail along the road leading into Golden Gate Canyon State Park. The work, projected for three weeks, took three months, because Pech was using a machine that moved dirt -- and up in the high country, the surface was all rock. It also took him weeks to discover that he lacked an essential tool of the business, the 1 1/4-inch wrench. It was like playing tennis without a racquet.

 

Still, by the early '80s, Adarand had become a competitor in a small segment of the state's lucrative highway construction industry. But within a few years, Pech noticed that he was losing contracts to disadvantaged business enterprises (DBEs), companies that were majority-owned by women or minorities and therefore presumed to be at a disadvantage in competing for government contracts.

That presumption was underscored by the Tenth Circuit of the U.S. Court of Appeals, which as recently as last year noted that discrimination by prime contractors, unions and lenders had "woefully impeded" the formation of qualified minority business subcontractors across the nation. Under a wide variety of state and federal programs, DBEs were targeted for government assistance to help counteract discrimination.

But while this benefited DBEs, the programs had a negative impact on other businesses. Adarand, for example, usually bid on about 250 jobs a year and received 30 to 50 percent of the work, according to Pech. By the mid-'80s, however, the company was losing about ten jobs a year that it would otherwise have received as the low bidder -- and that added up to as much as $1 million of lost revenue annually.

Pech didn't care for these DBE programs, but he figured there was no way they would last. Some politician would recognize what was going on and stop them, he thought. Somebody would raise a fuss. He never thought the task would fall to him. Finally, in 1987, at the urging of his wife, Val, he testified before the state transportation department, which had begun holding public hearings about its disadvantaged business program. The Pechs were among a handful of critics in a room full of affirmative-action boosters. Randy Pech remembers, "You kind of come out of there saying, 'Are we missing something, or are we so backward that 95 percent of the people are against this?'"

The Pechs continued to attend hearings every six months or so, and although they rarely found anyone who agreed with them, they didn't give up. "The alternative was to not do anything," says Randy.

"If not us," asks Val, "who?"

So the Pechs contacted state legislators, who they say agreed that the affirmative action programs were wrong, but they were not prepared to take a public stand against them. The only concrete suggestion they could give the Pechs was to adopt a common, rule-bending scam: Randy could simply transfer ownership of Adarand to Val, and then it would qualify as a disadvantaged business. The Pechs refused. "It's fraudulent," says Val. "That to us was absolutely fraudulent."

The Pechs acknowledged that DBE programs probably had been started with good intentions, but they believed the issue had swerved out of control. So the couple approached the Mountain States Legal Foundation, a nonprofit, public-interest law firm dedicated to free enterprise. Mountain States told the Pechs they needed to wait for the right time to take action: If Adarand lost a contract funded entirely by the state or the feds, and not a mixture of the two, the foundation could pinpoint a legal attack.

In 1989, the Pechs saw their opportunity.


The term "affirmative action" was first used by President John F. Kennedy in 1961, as part of his call for greater integration of workforces for projects financed with federal money. Many modern affirmative-action programs were set in motion following the passage of the federal Public Works and Employment Act of 1977, which authorized $4 billion to be awarded to state and local governments for public-works projects. One provision of the act required that at least 10 percent of each grant go to minority business enterprises, or MBEs (later renamed DBEs).

A common feature in federal affirmative-action programs in the construction arena was a Subcontracting Compensation Clause. Under an SCC, the U.S. Department of Transportation and its subsidiary agencies awarded a bonus worth 10 percent of the value of the work to be subcontracted to the prime contractor if it used a DBE. This enabled a contractor to lower its bid by 10 percent, because it could count on the feds making up the difference.

The Central Federal Lands Highway Division, a division of the federal transportation department, adopted the SCC program in 1979. Ten years later, the CFLHD initiated a contract for the Dolores River Project, a highway project along the San Juan National Forest in southwestern Colorado. The primary contract went to a company called Mountain Gravel, which in turn solicited bids for a variety of subcontractor work, including guardrail construction.

 

The 4.7-mile job would be a nice one for Adarand, and the company bid $104,000 for the work. Dolores-based Gonzales Construction, a disadvantaged business, bid $106,000 -- and got the job. Officials at Mountain Gravel later told Pech that if it hadn't been for the SCC, Adarand would have won the contract. At Pech's request, they agreed to put that in writing.

Pech took the documentation to Mountain States. This was a case the foundation could work with, because the contract was entirely a federal project. Mountain States agreed to take the case pro bono, which it has continued to do throughout the years of litigation, and it filed suit against the U.S. Department of Transportation, claiming the federal program was unconstitutional.

Other legal challenges to affirmative action were already being made. Croson v. Richmond was filed after the city of Richmond, Virginia, which had a long and abominable record of discrimination, set a minority contracting goal of 30 percent. At the time, 50 percent of the city's population was black, but less than 1 percent of construction contracts were going to minority contractors. The plaintiff in the case, a non-DBE contractor, had been the sole bidder for a job, yet his company wasn't selected. In 1989, he filed suit under the Equal Protection Clause of the Fourteenth Amendment.

The Supreme Court eventually scuttled the Richmond program, and in doing so it created a tough standard, known as "strict scrutiny," that future state and local programs would have to meet.

For programs to comply with strict scrutiny, the government must show that they meet a compelling state interest. Anecdotal accounts of discrimination can satisfy that standard, but the City of Richmond was unable to demonstrate that it had discriminated against minority contractors in awarding contracts. Strict scrutiny also requires that the program in question be narrowly tailored to address only those individuals harmed by past discrimination. The court found that Richmond's 30 percent requirement was too broadly focused.

A pivotal factor involved the total number of qualified DBEs in a particular industry versus the number getting work: The more those numbers differed, the easier it was to prove that a disparity existed. But according to Anthony Robinson, president of the Washington, D.C.-based Minority Business Enterprise Legal Defense and Education Fund, relying on the number of qualified firms as a baseline figure doesn't acknowledge discrimination's effects on a firm's ability to become qualified. "If your premise is you have fewer firms because of discrimination," he says, "then you lock them into that depressed number."

Croson's impact on Adarand's case wasn't felt immediately, though. In 1992, the U.S. District Court for Colorado ruled against Adarand, determining that federal DBE programs were constitutional. On appeal, the Tenth Circuit Court addressed the SCC program specifically and still upheld the district court's ruling. The Pechs appealed to the U.S. Supreme Court.

In 1995, six years after the initial contract had been bid, Adarand's fortunes shifted dramatically. In a landmark decision, the U.S. Supreme Court reversed the lower courts' rulings and declared, 5-4, that federal affirmative-action programs must meet the same "strict scrutiny" standard required of state programs.

Opponents of "strict scrutiny" thought the courts should continue to give the federal government greater leeway in remedial programs. Proponents argued that subjecting a program to strict scrutiny was the only way to make sure it was constitutional. In practical terms, however, even after the 1995 Adarand ruling, the Clinton Administration tried to change federal affirmative action programs as little as possible. "Mend it, don't end it," was the administration's slogan.

Attorney Rob Corry, who's behind a movement to place an anti-affirmative action measure before Colorado voters, says Clinton's "slogan was probably better stated as 'Defend it, don't mend it.' It was really just business as usual."

Adarand's case was sent back to the U.S. District Court to be considered under this new standard. "I was told we won, but we were going back to court," Randy Pech recalls. "I was absolutely as baffled as I could get."

Things would get even more baffling.


Of the five major guardrail companies in Colorado, four have spent long periods classified as disadvantaged. C&K of Fountain and Gonzales Construction are currently on the list. Cruz Construction and Ideal Fencing dropped off in recent years when their eligibility ended. All of these companies have been in business for at least fifteen years. All are unimpressed with Adarand's legal fight.

"The difference between me and Adarand," says Ken Lacey, who owns C&K, "is I am not trying to feather my nest."

Last summer, Lacey claims, Adarand tried to underbid him after he had already signed a contract to install guardrail for the state transportation department. Sometimes Colorado contracts are expanded while they're being completed, and another bid request is put out for the new work. Adarand "had the gall to step in during an ongoing contract," Lacey says. Adarand's after-the-fact lower bid cast doubt on C&K's original bid, he claims.

 

Pech points out that C&K's bid for the same work was twice as high as Adarand's. And while he says he doesn't blame Lacey for being angry, he notes that C&K eventually got the second contract -- even though its bid was still 25 percent higher than Adarand's. Because C&K was a DBE, says Pech, the state "didn't want to ruffle his feathers."

Joe Cruz, president of Cruz Construction, is also unhappy with Pech. The same week in 1995 that the Supreme Court ruled in Adarand's favor, Cruz bid for a subcontractor job in Gunnison County. After learning that Elam Construction was the low prime contractor, Cruz called Elam and asked what subcontractors had been selected. Elam told Cruz that Adarand had submitted the lowest bid. Yet other contractors who'd lost the prime bid later told Cruz that his bid was lowest, by exactly $912.50. When Cruz confronted Elam, he says he was told that Adarand had been selected because Elam owed Pech's company a favor: Adarand had once bailed out a DBE that couldn't finish a job in Eagle County.

"If that's not being prejudiced, what the hell is it?" Cruz asks. "That's the same thing Adarand went to court for."

There's a difference, Pech insists: Working relationships, familiarity with a company -- these are acceptable ways to choose a subcontractor, even when it doesn't submit the low bid. The absolutes of race and gender, on the other hand, are unacceptable, he says.

Pech worries about unfairly being labeled as a racist. But that's not the word his critics use: They say he's greedy. According to the state transportation department, Colorado's five major guardrail companies have earned $84 million in state contracts since 1991, awarded either directly as prime contracts or indirectly as subcontracts. Adarand has received 30 percent of that business, or just under $26 million. Ideal and C& K have each received a little more than $20 million. Cruz, however, has received only $7.4 million. And Gonzales, whose bid inspired Adarand's suit, has earned only $3.9 million. (Gonzales president Frankie Gonzales declined to speak with Westword.)

Pech has a "vision of doing all the guardrail work in the state of Colorado," Lacey says. "He can't do it. He does not appreciate good, honest competition."

Of the last ten guardrail jobs the state bid on in 2000, Adarand received eight of them, Cruz says. Through May of this year, Adarand has been awarded $2.4 million in subcontracts; Ideal has received just over $1 million. Gonzales has earned a paltry $2,300, but that's still better than Cruz and C&K, who have gotten nothing. (Four of the guardrail companies received no prime contracts as of the end of May; Gonzales, the exception, won $133,000 worth of work.)

In short, Pech's competitors say, Adarand is already at the top of the heap. "Do you want to ask if the man is greedy?" says Cruz. "Yes, he is."

"That's what gets me about cases like this," comments Roberto Corrada, a law professor at the University of Denver. "It's just pure greed."

But Val Pech says she and her husband are just ordinary working people trying to make a living the same as everyone else. Their battle is not about money, the Pechs say, pointing out that they haven't sought financial damages. To them, it's simply a matter of right and wrong.

"We will never give up as long as our government is making determining decisions based on race," says Val, adding that their case "is about the core values of what it means to be an American."

Those sentiments haven't won over the skeptics, though.

"He never lost a job to me because of affirmative action," Lacey says of Pech. "I think Adarand is just out there beating their drum on the corner because they wanted the attention."


In June 1997, the U.S. District Court for Colorado again ruled on the Adarand case, this time determining that the SCC program was unconstitutional, because it was not narrowly tailored. U.S. District Court Judge John Kane said that the federal standards to become a DBE were both overinclusive and underinclusive, rewarding minorities who were not disadvantaged and penalizing whites who were.

Fresh from this triumph, Adarand sued the State of Colorado, which had used affirmative-action programs to award transportation contracts for two decades. According to MGT of America, a national management research and consulting firm that conducted disparity studies for the State of Colorado and the state transportation department, the department had operated a voluntary DBE program between 1971 and 1974, when only .3 to .9 percent of construction funds went to disadvantaged firms. In 1980, the Colorado Highway Commission, the Colorado Contractors Association and the Minority Contractors Association had agreed to a program for minority-business contracting. By 1989, the department had established a DBE goal of 10 percent for all Colorado highway work, both state and federally funded. Studies conducted in Denver and throughout Colorado during the '80s had all established that there was discrimination in the state-highway and construction industries.

 

Debra Gallegos, who manages the Center for Equal Opportunity at the state transportation department, is rankled at the suggestion that Colorado uses set-aside programs to boost minority participation. The DBE program the state follows is goal-oriented, she says. Unlike the federal SCCs, Colorado's program has never offered incentives for prime contractors to meet DBE goals, she explains. The state simply required prime contractors to make a good-faith effort to include minorities and women. If low-bidding contractors failed to use DBEs or were unable to prove they had made an honest effort to locate them, the state could rebid a contract.

Nevertheless, with the Adarand suit looming, state transportation department officials revamped the DBE program to head off litigation. "They broadened the definition of disadvantaged business," says law professor Corrada.

The first change simply required that all DBE applicants sign a statement saying they had been discriminated against in the past -- no need to provide any details. According to the state, this move eliminated the presumption that minorities and women were disadvantaged and that whites were not. The second was to cap the size of participating DBE businesses: An owner's net worth could not exceed $750,000.

Once these new changes were in place, the number of recognized DBEs dropped from about 350 to 280. (It has since risen to around 320.) Some contractors couldn't honestly claim past discrimination; some owners' personal net worth was too high (as in the case of Cruz Construction); still others didn't want to reveal their finances.

Judge Kane was also appointed to preside over the state case. Under the new rules, he determined that Adarand itself could possibly be a disadvantaged business.

So Pech decided to apply and see if he could destroy the DBE program from within.

Adarand was indeed certified as a DBE in June, 1998, and for just a few months all five guardrail subcontractors in Colorado qualified as disadvantaged businesses. As a result of its DBE status, Adarand got work -- especially when its bid was a few percentage points lower than the others' -- that it wouldn't have gotten before, Pech says. "Since all of us were DBEs, it was the same as none of us being DBEs," he notes.

"That was bullshit," says Cruz. "What else can I say? To me that was stooping pretty low. I'm not a minority by choice. For me to try and change my status just to benefit from something is pretty low."

But the plan almost backfired on Pech. In March 1999, the Tenth Circuit Court concluded that since Adarand was now a disadvantaged business, its case against the state's DBE program was moot. The judges also vacated Kane's 1997 U.S. District Court ruling.

Pech appealed a second time to the U.S. Supreme Court, which again overturned the Tenth Circuit Court, ruling in January 2000 that Adarand's status as a disadvantaged business did not invalidate its earlier claims. The guardrail company still had standing, the court determined, because it was not clear that the U.S. Department of Transportation wouldn't revoke Adarand's DBE status, and it also wasn't clear that the "alleged wrongful behavior" of the government would not continue.

In an attempt to find legal clarity, the high court returned the dispute to the Tenth Circuit, where judges would rule on the merits of the SCC program using the strict-scrutiny standard. The Tenth Circuit found that changes to the SCC program, instituted in November 1997, made it more flexible; the court concluded that even when evaluated by the strict-scrutiny standard, the program was constitutional.

But the legal fight wasn't over yet. Lawyers at the Mountain States Legal Foundation now argued that the SCC program had not been sufficiently changed to be considered narrowly tailored and again appealed Pech's case. And the Supreme Court again agreed to hear it.

This time, legal observers think the decision of the judges on the Tenth Circuit will likely be overturned. "They applied the standard, but not in the way the Supreme Court would," says Corrada. "They used all the right language but took a broader approach."

 

The Tenth Circuit applied strict scrutiny "with a wink or a nod," says Mike Kennedy, an attorney for the D.C.-based Association of General Contractors, "and reached conclusions that the evidence didn't seem to support."

"It's extremely rare for the court to take a case three times," he adds. "People tell me the court has never taken a case a fourth time."


Affirmative action is a difficult, and likely tiring, subject for Rosemary Breiner, owner of Breiner Construction and president of the Hispanic Contractors of Colorado. "I can't tell you the number of meetings and task forces I've been to," she says.

Breiner doesn't think the government has been willing to sit down with the construction industry and collaborate on better programs. "It's always been at the level of lawmakers who say, 'This is the way you're going to do this,'" she says. "Many times what's been passed runs contrary to how the industry works."

Some people take unfair advantage of the programs, she acknowledges. "I can understand why someone like Adarand gets upset," Breiner says. "On the other hand, knowing that when you have tried over the years to get your foot in the door with corporations that spend big dollars on construction and they have their select list and you can't ever get into that, I say something needs to be done. These programs need to be out there. It takes a lot of money to get into this industry. You need that help from somewhere."

DBE programs never really helped Cruz Construction, Cruz insists. As a prime contractor, he says, "as far as I'm concerned, I still have to be the low bidder."

Ideal Fencing used to be owned by a woman, but is now run by her brother-in-law and is no longer certified by the state as a DBE. "We don't see any real difference in the amount of work we get, with the program or without it," says Ideal's new owner, Jim Bockelmann. "Back when we were eligible to participate, it still seemed that the bid process prevailed." Since its ownership change, Ideal has been holding steady, he adds.

"I'm not all for it," Bockelmann continues. "I'm all for programs to help companies get started, get their feet wet." Even when he was working for his sister-in-law, he had second thoughts about the program. He remembers thinking, "Is it fair? How do they really come up with this stuff?"

C&K says it has lost prime contracting bids even though it met the DBE goals. "They don't meet their goals, but they still get awarded," Lacey complains of larger, non-DBE companies.

"All that a prime contractor has to do is demonstrate he made an effort to contact DBEs," Cruz adds. "He does not have to use that DBE."

"It nullifies the program," agrees Lacey.

The biggest beneficiaries of disadvantaged business programs may not be minority-owned businesses, but women-owned businesses, particularly traffic-control ventures -- the businesses that direct traffic at construction sites. "I think it's helped some," says Cruz. "I think it's probably helped women a lot."

As part of its own efforts to meet strict scrutiny, in 1998 the State of Colorado performed a disparity study of all its agencies to gauge how DBEs were doing. "It was clear we had to narrowly tailor the program," says Gallegos. The study found that between 1990 and 1996, Hispanic- and women-owned subcontracting businesses had been overutilized in highway-construction jobs, while African-American, Asian and Native-American businesses, as well as those owned by white men, were underutilized.

So in October 1998, the state took Hispanic- and women-owned businesses off its goals list. No longer would it make an effort to use those businesses more. The impact on those businesses was huge. "How can they tell me I'm not a minority?" asks Doris Quintana of DQ Construction, who's upset that other groups are still included on the disadvantaged list. As for the guardrail companies, all five were removed from the goals list.

"If you make the [state] disadvantaged enterprise goal, it shouldn't matter what your gender is or race is," says Laurie Gallegos, co-manager of Cone Zone, a Greeley-based traffic-control company. The DBE program helped Cone Zone get started in 1998, but the company's sales diminished in 2000.

In fiscal year 1997, $35.1 million was awarded to DBE prime- and subcontractors, out of an available total of $374 million -- about 9 percent. In 2000, DBEs received $31.2 million out of a possible $598 million, only 5 percent of the total available. (Through May of this year, DBEs have received 6.8 percent.)

A second disparity study, completed this past April, covered DBE participation from October 1, 1996, to March 30, 2000, a period during which $1.9 billion in state transportation work was put out to bid. The study determined that women- and Hispanic-owned businesses were now being underutilized, along with those companies owned by other minority groups. Construction businesses owned by white men were being overutilized.

 

"In the two years since they changed that," says attorney Jean Dubofsky, who represented the state in its suit against Adarand, "the numbers have dropped precipitously."

From now on, the state will be monitoring DBE progress on a quarterly basis. And just last month, Hispanic- and women-owned groups were returned to the state's goals list. This year's target for DBEs is 10.39 percent participation -- which is almost identical to the 10 percent goal set by the Public Works Act nearly 25 years and many court cases ago.

Cruz received three big state jobs in 2000 (his DBE status was not responsible for any of them, he insists), which have kept his coffers full. But this year he hasn't gotten any state work, nor has C&K.

Ideal has pulled in $1 million in subcontracting jobs but nothing in prime bids. "We're getting beat," says Bockelmann. "Cruz beat us, Adarand beat them. There were a couple of jobs over by Gonzales, they got them."

"If you're gonna get guardrail, you have to get tough," he adds. "The margins are pretty thin."


This past January, the Pechs got a call from Rob Corry, an attorney they'd met when they testified before the U.S. Senate in 1997. Corry was creating a Colorado ballot initiative that would be similar to California's Proposition 206, the 1996 measure that outlawed affirmative-action programs in that state. Corry invited the Pechs to a meeting in Denver.

From that meeting came the start of a new group: Unite Colorado. Val Pech was asked to be co-chair, and she collected the business cards of the meeting's other participants and researched them. "I didn't want to be involved with anyone who was racist or bigoted," she says. "I wanted to make sure they had the right reasons for doing this. Everybody checked out."

In April the group approached State Representative Shawn Mitchell, an Adams County Republican, who agreed to sponsor a bill that would end racial and gender preferences in government contracts and eliminate race and gender as factors in college admissions.

Her colleagues at first wanted to leave gender out of the language, Val Pech remembers, but she balked. She didn't know how she could take a public stand against affirmative action while being "this little white girl," she says, "and I need preference." The others eventually relented.

The group wanted the legislature to approve the measure for the 2002 ballot. The proposal passed the House State Veterans and Military Affairs Committee but died in the House itself. So Unite Colorado is now working on a new initiative that it plans to petitition onto the ballot.

What the Supreme Court decides this fall could make a big difference. "I think they've been trying to take a case to get rid of affirmative action for some time," says Dubofsky. "Maybe this case is it."

The judges' ruling could affect hundreds of programs across the country. Over the last generation, people of color and women have become stakeholders in businesses that deal with the government. Now "those policies are at risk," Robinson says. "When you don't have a public-policy mandate to create opportunities for ethnic minorities and women, those opportunities cease to exist."

"The problem the government has is that the program has been in place for a generation," counters Kennedy. "At some point a remedial program serves its purpose or demonstrates it is ineffective. If it's served its purpose, the government can't justify continuing. If it is ineffective, the government can't justify its use."

In a perfect world, the Supreme Court would say that what happened to his company was "no different from discrimination," Randy Pech says. "And this not allowed under any circumstances. Period."


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