Bishop of Charleston v. Marcia Adams

• Court: Court of Appeals for the Fourth Circuit
• Decided: July 6, 2023
• Docket: 22-1175
• Status: Unpublished

Opinion

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UNPUBLISHED

UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT

No. 22-1175

BISHOP OF CHARLESTON, d/b/a Roman Catholic Diocese of Charleston, a Corporation Sole; SOUTH CAROLINA INDEPENDENT COLLEGES AND UNIVERSITIES, INC.,

Plaintiffs - Appellants, v.

MARCIA ADAMS, in her official capacity as the Executive Director of the South Carolina Department of Administration; BRIAN GAINES, in his official capacity as budget director for the South Carolina Department of Administration; HENRY DARGAN MCMASTER, in his official capacity as Governor of South Carolina,

Defendants - Appellees,

and

STATE OF SOUTH CAROLINA,

Intervenor/Defendant – Appellee.

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AMERICANS UNITED FOR SEPARATION OF CHURCH AND STATE; BEND THE ARC: A JEWISH PARTNERSHIP FOR JUSTICE; CENTRAL CONFERENCE OF AMERICAN RABBIS; DISCIPLES CENTER FOR PUBLIC WITNESS; DISCIPLES JUSTICE ACTION NETWORK; EQUAL PARTNERS IN FAITH; GLOBAL JUSTICE INSTITUTE, METROPOLITAN COMMUNITY CHURCHES; HINDU AMERICAN FOUNDATION; INTERFAITH ALLIANCE FOUNDATION; MEN OF REFORM JUDAISM; NATIONAL COUNCIL OF JEWISH WOMEN; WOMEN OF REFORM JUDAISM; UNION FOR REFORM JUDAISM; ORANGEBURG SCHOOL DISTRICT; SOUTH CAROLINA STATE CONFERENCE OF THE NAACP; NATIONAL EDUCATION ASSOCIATION; THE SOUTH CAROLINA EDUCATION ASSOCIATION; PUBLIC FUNDS USCA4 Appeal: 22-1175 Doc: 96 Filed: 07/06/2023 Pg: 2 of 10

PUBLIC SCHOOLS; SOUTHERN EDUCATION FOUNDATION; ADVANCEMENT PROJECT NATIONAL OFFICE,

Amici Supporting Appellees.

Appeal from the United States District Court for the District of South Carolina, at Charleston. Bruce H. Hendricks, District Judge. (2:21-cv-01093-BHH)

Argued: December 7, 2022 Decided: July 6, 2023

Before THACKER, HARRIS, and HEYTENS, Circuit Judges.

Vacated and remanded with instructions by unpublished per curiam opinion.

ARGUED: Daniel Robert Suhr, LIBERTY JUSTICE CENTER, Chicago, Illinois, for Appellants. Thomas T. Hydrick, OFFICE OF THE ATTORNEY GENERAL OF SOUTH CAROLINA, Columbia, South Carolina; William Grayson Lambert, OFFICE OF THE GOVERNOR OF SOUTH CAROLINA, Columbia, South Carolina, for Appellees. ON BRIEF: Jeffrey D. Jennings, LIBERTY JUSTICE CENTER, Chicago, Illinois; Richard S. Dukes, Jr., TURNER PADGET GRAHAM & LANEY, P.A., Charleston, South Carolina, for Appellants. Christopher E. Mills, SPERO LAW LLC, Charleston, South Carolina; Vordman Carlisle Traywick, III, ROBINSON GRAY STEPP & LAFFITTE, LLC, Columbia, South Carolina; Thomas A. Limehouse Jr., Chief Legal Counsel, Michael G. Shedd, Deputy Legal Counsel, OFFICE OF THE GOVERNOR OF SOUTH CAROLINA, for Appellee Governor McMaster. Alan Wilson, Attorney General, J. Emory Smith, Jr., OFFICE OF THE ATTORENY GENERAL OF SOUTH CAROLINA, Columbia, South Carolina, for Appellee State of South Carolina. Eugene H. Matthews, RICHARDSON PLOWDEN & ROBINSON, P.A., Columbia, South Carolina, for Appellees Marcia Adams and Brian Gaines.

Unpublished opinions are not binding precedent in this circuit.

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PER CURIAM:

The Bishop of Charleston and South Carolina Independent Colleges and

Universities (“Appellants”) challenge Article XI, Section 4 of the South Carolina

Constitution (“Section 4”), which prohibits the use of public funds “for the direct benefit

of any religious or other private educational institution.” In their view, Section 4 violates

the Equal Protection Clause of the Fourteenth Amendment and the Free Exercise Clause

of the First Amendment because, although it is facially neutral, its enactment was

motivated by both racial and religious discriminatory intent. Appellants’ challenge arose

after the South Carolina Supreme Court ruled that Section 4 prevented the Governor of

South Carolina from awarding certain COVID-19 relief funds to private and religious

schools, including Appellants. Additionally, after the South Carolina Supreme Court’s

ruling, the state’s Department of Administration refused to disperse other COVID-19 relief

funds to private and religious schools pending further judicial direction.

Because all of the funds at issue have been otherwise allocated and are no longer

available, this case is moot. For the reasons that follow, we vacate the district court’s

decision and remand with instructions to dismiss the case.

I.

“Our jurisdiction under Article III is limited to cases and controversies.” Holloway

v. City of Virginia Beach, 42 F.4th 266, 273 (4th Cir. 2022) (citations omitted). The

doctrine of mootness prevents us “from advising on legal questions ‘when the issues

presented are no longer “live” or the parties lack a legally cognizable interest in the

outcome.’” Eden, LLC v. Justice, 36 F. 4th 166, 169 (4th Cir. 2022) (quoting Fleet Feet,

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Inc. v. NIKE, Inc., 986 F.3d 458, 463 (4th Cir. 2021)). In other words, “federal courts may

not opine on the merits of a case when doing so would have no practical effect on the

outcome of the matter.” Holloway, 42 F.4th at 275 (internal quotation marks omitted)

(citation omitted). This limit applies “throughout the course of litigation, to the moment

of final appellate disposition.” Catawba Riverkeep Found. v. N.C. Dep’t of Transp., 843

F.3d 583, 588 (4th Cir. 2016) (internal quotation marks omitted). Thus, “a case may

become moot after entry of a district court’s judgment and while an appeal is pending.”

Eden, LLC, 36 F.4th at 169–70 (citation omitted).

Other Circuit Courts of Appeals have routinely deemed cases to be moot when there

are no longer funds available from which the court could provide relief. See, e.g., Cnty. of

Westchester v. U.S. Dep’t of Hous. & Urb. Dev., 778 F.3d 412, 417 (2d Cir. 2015)

(dismissing as moot claims regarding funds that had since been reallocated); Cnty. of

Suffolk, N.Y. v. Sebelius, 605 F.3d 135, 140–42 (2d Cir. 2010) (finding that case had

become moot when federal agency had exhausted the congressional appropriations for the

relevant grant program and sovereign immunity barred federal court from ordering that the

contested amounts be paid from another source of funds); City of Houston, Tex. v. Dep’t of

Hous. & Urb. Dev., 24 F.3d 1421, 1426–27 (D.C. Cir. 1994) (concluding that case was

moot when federal agency had contractually obligated its entire congressional

appropriation, either through initial allocations or reallocations, and observing that “once

the relevant funds have been obligated, a court cannot reach them in order to award relief”);

W. Va. Ass’n of Comty. Health Cntrs., Inc. v. Heckler, 734 F.2d 1570, 1576–77 (D.C. Cir.

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1984) (holding that claims were moot as to funds that had previously been awarded and

thus were no longer were an available source for relief).

II.

In March 2020, as part of the Coronavirus Aid, Relief, and Economic Security Act

(“CARES Act”), Pub. L. No. 116–136, 134 Stat. 281 (Mar. 27, 2020), Congress established

the Governor’s Emergency Education Relief (“GEER”) Fund and authorized the Secretary

of Education to award emergency education relief grants to state governors with an

approved application. See CARES Act §§ 18002–18008. The CARES Act also imposed

a use-it-or-lose-it deadline, requiring states to allocate all funds, known as “GEER I” funds,

within one year or return the funds to the federal government. See id. § 18002(d).

South Carolina Governor Henry McMaster applied for and received $48,467,924 in

GEER I funds. In July 2020, Governor McMaster announced his plan to allocate

approximately $32 million of the GEER I funds to assist the state’s public and independent

historically black colleges and universities, and to establish the Safe Access to Flexible

Education (“SAFE”) Grants Program, which would have provided need based grants for

eligible students to attend participating private and independent schools. But after a

challenge to Governor McMaster’s plan, the South Carolina Supreme Court held that the

proposed SAFE Grants Program violated Section 4 because it would have used public

funds to provide a direct benefit to private schools. See Adams v. McMaster, 851 S.E.2d

703, 706 (S.C. 2020). Therefore, Governor McMaster reallocated the available GEER I

funds to other programs prior to the state’s May 11, 2021 one year deadline.

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In December 2020, Congress passed the Coronavirus Response and Relief

Supplemental Appropriations Act of 2021 (“CRRSAA”), Pub. L. 116-260, 134 Stat. 1182

(Dec. 27, 2020), which appropriated additional monies to the GEER Fund (“GEER II

funds”). The CRRSAA required that GEER II funds be allocated by state governors by

January 2022. Governor McMaster allocated all of the more than $21 million in GEER II

funds he was awarded before that deadline.

In the midst of the GEER Fund allocation, in September 2020, the South Carolina

General Assembly passed legislation to direct how other CARES Act funds that South

Carolina had received would be allocated. See 2020 S.C. Act No. 154 (“Act 154”). Among

other things, Act 154 authorized the South Carolina Department of Administration to

oversee the distribution of $25 million for a nonprofit relief program, id. § 3(E), and

$115 million for state and local governments and independent college and university

expenditures, id. § 3(G). Importantly, the General Assembly directed that the expenditures

Act 154 authorized were to come from “the remaining portion of the CARES Act funds

that remain on deposit in the Coronavirus Relief Fund.” Id.at § 1. Though Act 154 would

have allowed independent colleges and universities to apply for funds, the Department of

Administration “refrain[ed] from disbursing money to independent colleges and

universities under the Act without further judicial direction,” J.A. 307 1, as a result of the

South Carolina Supreme Court’s decision in Adams.

1 Citations to the “J.A.” refer to the Joint Appendix filed by the parties in this appeal.

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Because they were not permitted to apply for or receive GEER funds or Act 154

funds, Appellants filed this lawsuit challenging the constitutionality of Section 4.

Appellants sought a declaration that Section 4 was unconstitutional, injunctive relief

allowing them the opportunity to apply for GEER funds and Act 154 funds, and nominal

and compensatory damages. In their Amended Complaint, Appellants named Marcia

Adams, in her official capacity as the executive director of the South Carolina Department

of Administration; Brian Gaines, in his official capacity as budget director for the South

Carolina Department of Administration; and Governor McMaster, in his official capacity

as Governor of South Carolina; and the State of South Carolina later intervened

(collectively, “Appellees”).

After discovery, the parties filed cross motions for summary judgment. Appellants

argued that Section 4 was unconstitutional because it was the result of or motivated by

racial and religious animus. For their part, Appellees disagreed that Section 4 was the

result of racial or religious animus, and they asserted that Appellants had failed to

demonstrate otherwise. In considering the motions for summary judgment, the district

court first held that insofar as Appellants sought damages against Adams, Gaines, and

Governor McMaster in their official capacities, sovereign immunity pursuant to the

Eleventh Amendment barred relief. Additionally, the district court determined that it

lacked jurisdiction over Appellants’ GEER fund claims for a number of reasons, including

that the issue was moot because Governor McMaster has fully allocated all GEER I and II

funds. But because there was not evidence that the Act 154 funds had been exhausted

when the district court issued its order in February 2022, the district court considered the

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merits of Appellants’ claims. Ultimately, the district court upheld Section 4, finding that

Appellants could not demonstrate that Section 4 was motivated by racial or religious

discriminatory intent. The district court thus granted summary judgment in favor of

Appellees and dismissed the case.

In their opening brief in this appeal, Appellants argued that the district court erred

in upholding the constitutionality of Section 4. Of note, however, Appellants did not

challenge the district court’s ruling as to sovereign immunity or its determination that

Appellants’ claims as to the GEER funds were moot. In their Response, Appellees not

only argued the merits with respect to Section 4, but also argued that the entire case is now

moot because in June 2021, the South Carolina General Assembly enacted the 2021–2022

Appropriations Act (the “Appropriations Act”), 2021 S.C. Act No. 94, Part

1.B, 118.18(A)(5). The Appropriations Act reallocated all monies remaining in South

Carolina’s Coronavirus Relief Fund, including all Act 154 funds. In reply, Appellants only

disputed whether Appellees had sufficiently demonstrated that there were no Act 154 funds

remaining. Indeed, Appellants noted that if this court were to determine that “the case is

in fact moot because the Act 154 and GEER I and II funds are all irretrievably gone, the

proper response [would be] to vacate the judgment below and remand for dismissal of the

case as moot.” Appellants’ Reply Br. at 4–5.

After briefing was complete, Appellees filed a “Suggestion of Mootness,” further

advising the court that all of the Act 154 funds have been not only reallocated but “have

actually already been dispersed.” See ECF No. 80, Suggestion of Mootness at 5. In

support, Appellees attached a Declaration of Brian Gaines, in his official capacity as the

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Director of the Executive Budget Office in the South Carolina Department of

Administration, which confirmed that there are no funds remaining in South Carolina’s

Coronavirus Relief Fund. In response to the Suggestion of Mootness, Appellants did not

contend that their Act 154 claims continue to present a live controversy. Instead,

Appellants argued, for the first time, that their claims for nominal and compensatory

damages were not barred by sovereign immunity, such that this court can continue to

address the merits of Section 4’s constitutionality.

III.

As an initial matter, Appellants’ have missed the opportunity to argue that they are

entitled to compensatory and nominal damages. “[A] party waives an argument by failing

to present it in its opening brief or failing to ‘develop [its] argument’ -- even if [its] brief

takes a passing shot at the issue.” Grayson O Co. v. Agadir Int’l LLC., 856 F.3d 307, 316

(4th Cir. 2017) (citation omitted) (alterations in original)). The district court held that

sovereign immunity barred monetary relief and Appellants did not challenge that ruling in

their opening brief. Therefore, it is waived.

As to Appellants’ claims for injunctive relief, this case has clearly become moot.

Appellees have sufficiently demonstrated that all of the GEER I and II funds, as well as

the Act 154 funds, 2 have been allocated. Therefore, even if we were to rule in Appellants’

favor on the merits, we could not provide meaningful injunctive relief because there are no

2 Appellee’s Suggestion of Mootness was sufficient to satisfy the court that all Act 154 funds have been otherwise allocated. By virtue of our decision in this case, the pending motion to dismiss, ECF No. 80, is granted.

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longer any funds for which Appellants could apply. Indeed, Appellants conceded this point

at oral argument. See Oral Argument 7:15–7:25, Bishop of Charleston v. Adams, No. 22-

1175 (4th Cir. Dec. 7, 2022) https://www.ca4.uscourts.gov/OAarchive/mp3/22-1175-

20221207.mp3 (Q: “there is no dispute . . . that [Appellants’] claim for injunctive relief is

moot now?” A: “Yes, I believe that’d be right.”).

IV.

For the foregoing reasons, we vacate the district court’s decision and remand this

case with instructions that it be dismissed.

VACATED AND REMANDED WITH INSTRUCTIONS