March 1, 1979
SIMON KATZ D/B/A ELMHURST MANOR HOME FOR ADULTS, ET AL., PLAINTIFFS-APPELLANTS,
BARBARA B. BLUM, AS COMMISSIONER OF THE NEW YORK STATE DEPARTMENT OF SOCIAL SERVICES, ET AL., DEFENDANTS-APPELLEES.
Appeal from the United States District Court for the Southern District of New York.
Present: HON. WILLIAM H. TIMBERS, HON. THOMAS J. MESKILL Circuit Judges, HON. LEE P. GAGLIARDI United States District Judge Sitting by Designation
This cause came on to be heard on the transcript of record from the United States District Court for the Southern District of New York, and was argued by counsel.
ON CONSIDERATION WHEREOF, it is now hereby ordered, adjudged, and decreed that the judgment of said District Court be and it hereby is affirmed on the opinion of Judge Pollack dated November 30, 1978, except that we find it unnecessary to reach the issue of collateral estoppel and we express no opinion on that issue. Judge Pollack did not rest his decision on collateral estoppel. A. 131-32.
This so-called "underinclusive" regulation requiring reports from proprietary homes for adults does not violate the equal protection clause. It involves neither fundamental rights nor suspect groups. It easily satisfies the relaxed rationality measure used to test business regulation. We recently have been reminded of the Supreme Court's reluctance to upset states' economic regulations on this ground, City of New Orleans v. Dukes, 427 U.S. 297 (1976), in which the "only... case in the last half century to invalidate a wholly economic regulation solely on equal protection grounds," Morey v. Doud, 354 U.S. 457 (1957), was overruled.
The for-profit nature of the proprietary homes affords a rational basis for their different treatment. New York, of course, is free to proceed with its resolution of the problem of the provision and cost of care for adults a little at a time, Railway Express Agency Inc. v. New York, 336 U.S. 106, 110 (1947), without violating the Constitution.
Appellants' due process claim likewise is without merit. This statute is not so unreasonable as to violate substantive due process, for it bears a "real and substantial relation to the object sought to be attained." Nebbia v. New York, 291 U.S. 502, 525 (1934). Nor is it "so burdensome that [it constitutes] even an outright 'taking,'" East Coast Lumber Terminal v. Town of Babylon, 174 F.2d 106, 110 (2 Cir. 1949) (Learned Hand, Ch. J.). There is no showing here that the costs of the required report amount to confiscation. "Of course many forms of regulation reduce the net return of the enterprise; yet that gives rise to no constitutional infirmity." Day-Brite Lighting, Inc. v. Missouri, 342 U.S. 421 (1952) (Douglas, J.)
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