Smith v. JEFFERSON COUNTY BD. OF SCHOOL

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
File Name: 11a0045p.06

UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
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STEVE B. SMITH, DAVID KUCERA, VICKIE F.

Plaintiffs-Appellants, --
FORGETY,

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No. 06-6533

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>
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v.

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COMMISSIONERS; DOUGLAS R. MOODY, LANA -
JEFFERSON COUNTY BOARD OF SCHOOL
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LECKIE, BILL POWELL, DAVID LOCKHART,

SNODDERLY, individually and in their official -
ANNE M. POTTS, GREG SHARPE, LOUISE
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capacity as members of the Jefferson County
Board of Education; KINGSWOOD SCHOOL -
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Defendants-Appellees. -
INC.,
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Appeal from the United States District Court
for the Eastern District of Tennessee at Knoxville.
No. 03-00593—Thomas W. Phillips, District Judge.
Argued: January 31, 2008
Decided and Filed: February 11, 2011
Before: BATCHELDER, Chief Judge; MARTIN, BOGGS, MOORE, COLE, CLAY,
GILMAN, GIBBONS, ROGERS, SUTTON, COOK, McKEAGUE, GRIFFIN,
KETHLEDGE, and WHITE, Circuit Judges.
_________________
COUNSEL
ARGUED: George F. Legg, STONE & HINDS, P.C., Knoxville, Tennessee, for
Appellants. Jonathan Swann Taylor, BECKER, FLEISHMAN & KNIGHT, Knoxville,
Tennessee, for Appellees. ON BRIEF: George F. Legg, Eric J. Morrison, STONE &
HINDS, P.C., Knoxville, Tennessee, for Appellants. Arthur F. Knight III, BECKER,
FLEISHMAN & KNIGHT, Knoxville, Tennessee, for Appellees.
MOORE, J., delivered the opinion of the court, in which MARTIN, BOGGS,
COLE, CLAY, GILMAN, GIBBONS, SUTTON, McKEAGUE, GRIFFIN, and WHITE,
JJ., joined. MARTIN, J. (pp. 29–31), joined by Judge MOORE, and SUTTON, J. (pp.
32–35), delivered separate opinions concurring in full in the majority opinion.

1
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BATCHELDER, C.J. (pp. 36–40), delivered a separate opinion concurring in part and
dissenting in part. ROGERS, J. (pp. 41–46), delivered a separate dissenting opinion, in
which COOK and KETHLEDGE, JJ., joined and in which BATCHELDER, C.J., joined
in part.
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OPINION
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KAREN NELSON MOORE, Circuit Judge. The former principal of Jefferson
County, Tennessee’s alternative school and two former teachers at the school
(collectively, “the teachers”) allege that, by closing the county’s public alternative
school and contracting with Kingswood Academy (“Kingswood”) to provide
alternative-school services for public-school students, the Jefferson County Board of
School Commissioners and its members (collectively, “the Board” or “the defendants”)
violated the teachers’ (1) First Amendment Establishment Clause rights under the U.S.
Constitution and similar rights under article I, section 3 of the Tennessee Constitution;
and (2) procedural and substantive due-process rights under the Fourteenth Amendment
to the U.S. Constitution and article I, section 8 of the Tennessee Constitution. The
teachers appeal the grant of summary judgment to the Board on all of the teachers’
claims and the denial of the teachers’ motion for partial summary judgment.

We hold that the teachers have standing to raise the Establishment Clause claim.
In addition, we hold that the Board did not violate the teachers’ procedural and
substantive due-process rights and that the individual Board members are entitled to
legislative immunity. Therefore, we REVERSE the district court’s grant of summary
judgment to the Board on the teachers’ Establishment Clause claims and the district
court’s determination that legislative immunity for the Board members was moot, and
REMAND to the district court for further proceedings. We AFFIRM the district court’s
grant of summary judgment to the Board on the teachers’ procedural and substantive
due-process claims. Finally, because we hold that the individual Board members are
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entitled to legislative immunity, we need not address whether they are entitled to
qualified immunity.

I. BACKGROUND

A. Factual Background

The Board employed all of the teachers in this case during the 2002–2003 school
year. Vickie F. Forgety and Steve B. Smith were tenured teachers. Forgety served as
the principal of the alternative school. David Kucera taught under a contract that entitled
him to continue in his position for another year unless he was notified by April 15, 2003
of the nonrenewal of his contract.

1. Budget Cuts

After discussion of the budget on June 26, 2003, the Board voted to eliminate
several programs, including the alternative school and the positions of the teachers and
principal working there. It voted again to “officially delete” the alternative school at its
July 10, 2003 meeting. Joint Appendix (“J.A.”) at 351 (7/10/03 Mins. of the Regular
Meeting). In addition, the Board voted at the July meeting to contract with Kingswood
to provide alternative-school services for public-school students for the 2003–2004
academic year. Id. at 352. The contract between the Board and Kingswood specifically
stated that Kingswood personnel would not be considered employees of the Board. In
fact, the Director of Schools for the county, Douglas Moody, was not authorized to hire
or fire the Kingswood employees who provided the alternative-school services, nor did
he supervise or evaluate those individuals. Counsel for the Board, Chuck Cagle,
approved the contract.

Moody submitted a “Request for Closing a School” to the Tennessee Department
of Education on July 23, 2003, indicating that “[b]udget constraints for FY 2003–2004
led to a School Board decision to outsource Alternative school services on contract.”
J.A. at 361. He stated that he had only one reason for recommending the Kingswood
contract to the Board: “it was entirely a financial consideration that would fit in with
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other budget cuts.” J.A. at 159 (Moody Dep. at 46). Similarly, the Chair of the Board,
Lana Leckie, stated in her deposition that “financial costs” constituted “the primary
reason to enter into the contract” and that it would save them $171,423. J.A. at 378
(Leckie Dep. at 34).

Moody informed Forgety, Smith, and Kucera of the abolishment of their
positions after the Board’s decision. Each of the teachers eventually found a new
position, though only one continued her employment with the Board. As tenured
teachers, Forgety and Smith were placed on a “Preferred List for Re-employment of
Tenured Teachers.” J.A. at 243. Forgety declined to accept the positions that the Board
initially offered to her because she considered them to be inferior in pay and rank to her
previous position at the alternative school; she drew unemployment for the 2003–2004
school year. When the Board offered Forgety a principalship in the spring of 2004, she
accepted. Smith, however, did not respond to the Board’s offer of a History position in
the fall of 2003; he had accepted a history position in Georgia in late July 2003. Kucera,
a non-tenured teacher, drew unemployment pay for two months; by November 2003, he
had not received any offers of employment from the Board in areas in which he was
certified. Eventually, he took a job with Mountain View Youth Development Center as
a case manager.

2. Kingswood

In a sworn statement, the “Administrator” of Kingswood, Darrell M. Helton,
stated that the school is an accredited private school, providing “day treatment programs
for children and adolescents who have behavioral and/or emotional problems.” J.A. at
178 (Sworn Statement of Helton). Helton noted that the school is licensed by the
Tennessee Department of Mental Health and Developmental Disabilities. Also, he noted
that an April 2005 study of Tennessee’s alternative schools by “the Tennessee
Comptroller of the Treasury Office of Education Accountability . . . specifically
identified as [sic] Kingswood School, Inc. [as] a private contract provider of alternative
school services that local education agencies could explore to provide alternative
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schooling to their students.” Id.; J.A. 327 (Tennessee’s Alternative Schools at 37). In
addition, Helton stated that Kingswood had contracted with Jefferson, Grainger,
Hancock, and Claiborne counties in Tennessee to provide alternative-school services.

Kingswood’s promotional materials state that “[f]or over 60 years Kingswood
School and Home for Children has helped children who have been abused, abandoned
and neglected. Kingswood School is unique because we offer children a Christian
environment of love and encouragement.” J.A. at 454 (Happy Easter, 2006 letter from
Kingswood). The school’s 2005 Annual Report states that

Kingswood was founded with the intent to insure that each child placed
in its care receives Christian religious training. A unique feature of the
Kingswood program is the emphasis that is placed upon instilling in each
child a personal faith in God, and the assurance of the saving grace of
Jesus Christ while remaining unaffiliated with any specific denomination
or Church.

J.A. at 457 (Annual Report). The 2005 Annual Report also states that Kingswood’s
“ministry” can be supported in many ways. Id. at 456. Although the residential-care
description states that there is an “emphasis” on “spiritual” growth, the day-treatment
description does not include that statement. Id.

B. Procedural Background

The district court consolidated cases brought by Forgety, Smith, and Kucera.1
Together the teachers brought suit against the Jefferson County School Board of
Commissioners and its members in their official and individual capacities2 under 42
U.S.C. § 1983, the Establishment Clause, and the Fifth and Fourteenth Amendments to

1
Forgety filed suit on June 24, 2004 against the same entities and individuals that Smith and
Kucera had filed suit against on November 13, 2003. Forgety, Smith, and Kucera did not oppose the
defendants’ motion to consolidate the cases, and the district court ordered consolidation on January 18,
2005.
2
The teachers sued the Director of Schools, Douglas R. Moody (who also served as Secretary to
the Board) and the following Board members in both their official and individual capacities: Lana Leckie,
Bill Powell, David Lockhart, Anne M. Potts, Greg Sharpe, and Louise Snodderly. The only Board member
that the teachers did not sue, Emily Fox, voted against the program cuts that affected the alternative school.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 6
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the U.S. Constitution. Also, they brought suit under various provisions of the Tennessee
Constitution and Code. The teachers sought declaratory relief and damages.
Specifically, their third amended complaint requested

1. That this Court issue a judgment declaring that the acts of
School Defendants in eliminating the Jefferson County Alternative
School Program were illegal and ultra vires acts, and thus were void acts.
Further, and accordingly, that this Court further declare that any
procedural due process which attached to those void acts was likewise
void. Further, that this Court directly evaluate the challenged procedures
to ensure that they comport with due process, and that this Court declare
that the procedures invoked by School Defendants did not so comport
with due process.
2. That this Court issue a judgment declaring that the acts of
School Defendants hereinbefore complained of violated the Due Process
Clauses of the Fifth and Fourteenth Amendments to the United States
Constitution, 42 U.S.C. § 1983, the Constitution of the State of
Tennessee, and Tennessee Code Annotated §§ 49-2-203, 49-5-501 et
seq., and 49-6-3402, and further denied Plaintiffs equal protection of the
law. Further that this Court issue a judgment declaring that the acts of
School Defendants hereinbefore complained of violated Plaintiffs’
constitutional rights protecting them from the impairment of the
obligations of their contracts. . . . That the Court also issue a judgment
finding and declaring that the acts of the Defendants violated Plaintiffs’
rights under The Establishment Clause of the First Amendment to the
United States Constitution and under Article I, Section 3 of the
Tennessee Constitution.
3. That this Court issue a judgment directing School Defendants
to make Plaintiffs whole for all losses of wages, benefits, and all other
terms and conditions of employment, and further directing and ordering
said Defendants to pay compensatory damages to Plaintiffs for all
damages Plaintiffs have suffered . . . in the amount of $1,000,000.00 for
Plaintiff, Steve B. Smith, in the amount of $100,000.00 for Plaintiff,
David Kucera, and in the amount of $1,000,000.00 for Plaintiff Vickie
F. Forgety.

J.A. at 58 (Third Am. Compl. ¶ 40).

On August 9, 2006, the teachers moved for partial summary judgment “on the
Federal Establishment Clause and Due Process claims and upon the pendent State
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claims, on the issue of liability, and the legality of Defendants’ actions.” J.A. at 390.
Less than two weeks later, the Board filed a cross-motion for summary judgment. The
Tennessee Education Association filed an amicus curiae brief. On November 2, 2006,
the district court denied the teachers’ motion for partial summary judgment and granted
the Board’s motion for summary judgment, in part for lack of standing. The teachers
filed a timely appeal.

II. ANALYSIS

A. Standards of Review

We review a district court’s grant of summary judgment de novo. Mazur v.
Young, 507 F.3d 1013, 1016 (6th Cir. 2007). “Summary judgment is proper if the
evidence, taken in the light most favorable to the nonmoving party, shows that there are
no genuine issues of material fact and that the moving party is entitled to a judgment as
a matter of law.” Id. (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S.
574, 587 (1986); Fed. R. Civ. P. 56(c)). “Although the denial of a motion for summary
judgment is usually an interlocutory order that is not immediately appealable, where an
appeal from a denial of summary judgment is presented in tandem with a grant of
summary judgment, this court has jurisdiction to review the propriety of the district
court’s denial of summary judgment.” Tenn. ex rel. Wireless Income Props., LLC v. City
of Chattanooga, 403 F.3d 392, 395 (6th Cir. 2005) (internal quotation marks omitted).
We review de novo denials of motions for summary judgment “‘on purely legal
grounds’”; we review for abuse of discretion denials “based on the finding of a genuine
issue of material fact.” Id. at 395–96 (quoting McMullen v. Meijer, Inc., 355 F.3d 485,
489 (6th Cir. 2004)).

When the district court reaches conclusions of law regarding standing, we review
the district court’s decision de novo. Doe v. Porter, 370 F.3d 558, 561 (6th Cir. 2004).
In addition, “the issue whether qualified immunity is applicable to an official’s actions
is a question of law.” Dickerson v. McClellan, 101 F.3d 1151, 1157 (6th Cir. 1996).
Finally, if a district court does not rule on an issue that the parties raised in their
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summary-judgment motions, we may rule on such issues under 28 U.S.C. § 2106 without
remanding them, as long as the parties were given a full and fair opportunity to address
those issues. See Trustees of the Mich. Laborers’ Health Care Fund v. Gibbons, 209
F.3d 587, 594-95 (6th Cir. 2000) (holding that a court of appeals may order entry of
summary judgment when “the parties . . . had a chance to dispute facts material to the
plaintiffs’ claim”); United States v. 5 S 351 Tuthill Road, Naperville, Ill., 233 F.3d 1017,
1024–25 (7th Cir. 2000) (reversing the district court’s holding that a claimant did not
have standing and determining that summary judgment was not appropriate for either
party because key facts were not included in the record).

B. Establishment Clause Claim

As a threshold matter, we must determine whether the teachers have standing to
bring their federal Establishment Clause claim. Although the parties’ cross-motions for
summary judgment raised the issue of whether the teachers had established both
individual standing and municipal-taxpayer standing, the district court addressed only
individual standing in its decision. The district court concluded that the teachers did not
meet the individual-standing requirements because their alleged injuries were the direct
result of the Board’s decision to allow a third party to run the alternative school, not the
result of that third party being a “faith based organization.” J.A. at 69 (Dist. Ct. Op. at
9). On appeal, the teachers argue that they meet the requirements for both individual
standing and municipal-taxpayer standing. We hold that none of the teachers have
individual standing to bring suit, but Forgety and Kucera meet the municipal-taxpayer
standing requirements.

1. Standing as Individuals

Standing to bring suit must be determined at the time the complaint is filed.
Lynch v. Leis, 382 F.3d 642, 647 (6th Cir. 2004), cert. denied, 544 U.S. 949 (2005). A
plaintiff must meet both constitutional and prudential requirements to establish
individual standing. Warth v. Seldin, 422 U.S. 490, 498 (1975). To meet the minimum
constitutional standards for individual standing under Article III,
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a plaintiff must show (1) it has suffered an ‘injury in fact’ that is (a)
concrete and particularized and (b) actual or imminent, not conjectural
or hypothetical; (2) the injury is fairly traceable to the challenged action
of the defendant; and (3) it is likely, as opposed to merely speculative,
that the injury will be redressed by a favorable decision.

Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180–81
(2000). The Supreme Court “repeatedly has rejected claims of standing predicated on
the right, possessed by every citizen, to require that the Government be administered
according to law.” Valley Forge Christian Coll. v. Ams. United for Separation of
Church & State, Inc., 454 U.S. 464, 482–83 (1982) (internal quotation marks omitted).

A plaintiff must also meet the following prudential requirements for standing
developed by the Supreme Court. First, a “plaintiff generally must assert his own legal
rights and interests, and cannot rest his claim to relief on the legal rights or interests of
third parties.” Id. at 474 (internal quotation marks omitted). Second, a plaintiff must
present a claim that is “more than a generalized grievance.” City of Cleveland v. Ohio,
508 F.3d 827, 835 (6th Cir. 2007) (internal quotation marks omitted). Finally, the
complaint must “fall within ‘the zone of interests to be protected or regulated by the
statute or constitutional guarantee in question.’” Valley Forge, 454 U.S. at 475 (quoting
Ass’n of Data Processing Serv. Orgs. v. Camp, 397 U.S. 150, 153 (1970)).

Here, the teachers clearly satisfy the constitutional requirements for standing, at
least as to damages. They suffered the injury of losing their jobs; that injury was the
direct result of the Board’s decision to abolish the public alternative school and to
contract with Kingswood;3 and the injury can be redressed by an order that the Board

3
In this context, “fairly traceable” merely means that something must link the plaintiffs’ job losses
to the contract with Kingswood. State law requires the Board to establish at least one alternative school
for grades seven through twelve. See Tenn. Code Ann. § 49-6-3402(a). Once the Board eliminated the
alternative school and terminated the teachers, it was required to fund a new alternative school.
Chief Judge Batchelder’s opinion contests this link by bifurcating the Board’s decision into two
steps, one eliminating the alternative school and another granting Kingswood the contract. However, the
vote about how to replace the alternative school never would have occurred but for the school’s
dissolution, and the vote about how to replace the alternative school was statutorily required after the
school’s dissolution. The fact that the Board could have picked a secular replacement is beside the point.
What matters is that the Board chose Kingswood. The requirement of a replacement school inextricably
ties the plaintiffs’ lost jobs to the Kingswood contract.
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compensate the teachers for lost salary and benefits,4 a resolution well within the
remedial power of the courts. See Singleton v. Wulff, 428 U.S. 106, 112–13 (1976)
(holding that “there is no doubt” that a Missouri statute prohibiting the use of Medicaid
benefits for abortions caused plaintiff physicians concrete injury and that their injury was
redressable).

Under the prudential limitations on standing, however, even when litigants have
established a substantial injury from a government action, they “cannot challenge its
constitutionality unless [they] can show that [they are] within the class whose
constitutional rights are allegedly infringed.” Barrows v. Jackson, 346 U.S. 249, 256
(1953). The teachers’ injury lies in the termination of their employment. Although they
emphasize that their jobs “were expropriated for the benefit of a sectarian institution,”
Appellant Supp. Br. at 11, they do not claim specific losses resulting from their
replacement by religious employees rather than nonreligious ones, and any
psychological injury arising from the fact that public-school instruction is now taking
place in a private religious institution would be a generalized grievance unless they can
establish taxpayer standing (addressed below). See Valley Forge, 454 U.S. at 483,
485–86 (“Although respondents claim that the Constitution has been violated, they claim
nothing else. They fail to identify any personal injury suffered by them as a
consequence of the alleged constitutional error, other than the psychological
consequence presumably produced by observation of conduct with which one disagrees.
That is not an injury sufficient to confer standing under Art. III, even though the
disagreement is phrased in constitutional terms.”). When plaintiffs challenging
government action under the Establishment Clause “allege only economic injury to
themselves” and “do not allege any infringement of their own religious freedoms,” they

4
Judge Batchelder calls it “a matter of common sense” that the proper remedy for Establishment
Clause violations is “an injunction or a declaratory judgment.” Slip Op. at 39. Certainly, those forms of
relief sometimes are the appropriate response to an Establishment Clause violation. There is no reason,
however, to think that each right has exactly one appropriate remedy for all circumstances. See Bivens v.
Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388, 410 (1971) (Harlan, J.,
concurring) (arguing that, while suppression sometimes is the appropriate remedy for Fourth Amendment
violations, “[f]or people in Bivens’ shoes, it is damages or nothing”). Judge Batchelder admits that the
plaintiffs’ injury in this case “hits in the pocketbook.” Slip Op. at 37. Money damages clearly do redress
a pocketbook loss.
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will have standing only if they may raise the constitutional claims of third parties.
McGowan v. Maryland, 366 U.S. 420, 429 (1961). In this case, the most obvious third
parties whose rights are implicated are the students who may be exposed to religion at
Kingswood and their parents.

“Ordinarily, one may not claim standing in this Court to vindicate the
constitutional rights of some third party.” Barrows, 346 U.S. at 255. The Supreme
Court has observed, however, that its salutary rule against third-party standing is not
absolute. Kowalski v. Tesmer, 543 U.S. 125, 129 (2004). The rule “should not be
applied where its underlying justifications are absent.” Singleton, 428 U.S. at 114. In
deciding when not to apply the rule, the Court has considered “two factual elements”:

The first is the relationship of the litigant to the person whose right he
seeks to assert. If the enjoyment of the right is inextricably bound up
with the activity the litigant wishes to pursue, the court at least can be
sure that its construction of the right is not unnecessary in the sense that
the right’s enjoyment will be unaffected by the outcome of the suit.
Furthermore, the relationship between the litigant and the third party may
be such that the former is fully, or very nearly, as effective a proponent
of the right as the latter.

Id. at 114–15. Elsewhere, the Court has described this test as requiring that “the party
asserting the right has a ‘close’ relationship with the person who possesses the right,”
and that “there is a ‘hindrance’ to the possessor’s ability to protect his own interests.”
Kowalski, 543 U.S. at 130 (quoting Powers v. Ohio, 499 U.S. 400, 411 (1991)); see also
Singleton, 428 U.S. at 115–16.

The teachers may have a sufficiently close relationship to their students to satisfy
the first prong of the test for third-party standing. The Supreme Court “has found an
adequate ‘relation’ . . . when nothing more than a buyer-seller connection was at stake.”
Kowalski, 543 U.S. at 139 (Ginsburg, J., dissenting) (citing cases). In Craig v. Boren,
429 U.S. 190 (1976), the Court allowed a licensed beer vendor to assert the equal-
protection rights of young men in challenging a law that allowed women aged eighteen
to twenty-one years old, but not men of the same ages, to purchase low-alcohol beer. Id.
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at 195. In Carey v. Population Services International, 431 U.S. 678 (1977), the Court
found that a retail seller of contraceptive devices had standing to raise the due-process
rights of its potential customers to challenge a statute variously limiting and prohibiting
the distribution of contraceptives and barring their advertisement. Id. at 683–84. The
teachers have a closer relationship to their students than was involved in either Craig or
Carey because the teachers were responsible for the students’ daily education; in the
instant case, their rights and injuries are inextricably linked, and the teachers likely
would be forceful advocates for the students’ rights. See Pierce v. Soc’y of the Sisters
of the Holy Names of Jesus & Mary, 268 U.S. 510, 534–36 (1925) (allowing private
schools to represent the due-process rights of parents whose children were required by
law to attend public school); see also Barrows, 346 U.S. at 257 (citing Pierce as an
example in which third-party standing was granted).

Although the teachers may be able to meet the first prong of the test for third-
party standing, they cannot meet the second. Unlike in the key cases in which the
Supreme Court has permitted third-party claims, we discern no indication here that the
students or their parents face any obstacle in litigating their rights themselves. There is
no evidence that the students or their parents might be deterred from suing. See, e.g.,
Singleton, 428 U.S. at 117 (allowing physicians to challenge exclusion of abortions from
Medicaid coverage when women would be chilled by desire to protect privacy);
Eisenstadt v. Baird, 405 U.S. 438, 445–46 (1972) (allowing seller of contraceptives to
assert equal-protection rights of potential purchasers for the same reason); Griswold v.
Connecticut, 381 U.S. 479, 481 (1965) (allowing physicians to challenge a law
criminalizing use of contraceptives on behalf of married couples for the same reason);
NAACP v. Alabama, 357 U.S. 449, 459 (1958) (allowing organization to asserts its
members’ rights to nondisclosure of membership lists to prevent “nullification of the
right at the very moment of its assertion”). Nor is there evidence here that the claims of
the students would be imminently moot, see, e.g., Singleton, 428 U.S. at 117 (pregnant
women); Craig, 429 U.S. at 192 (men aged eighteen to twenty), or that the students face
systemic practical challenges to filing suit, see, e.g., Powers, 499 U.S. at 414 (allowing
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criminal defendants to raise potential jurors’ equal-protection rights against race-based
peremptory strikes because jurors’ small financial stake, the expense of litigation, and
the limited availability of equitable relief made juror suits rare in practice). For this
reason, the teachers’ claims run afoul of the prudential limit on third-party standing.
Therefore, the teachers do not have individual standing to sue for damages.

2. Standing as Municipal Taxpayers

The teachers next argue that because they are municipal taxpayers, they have
standing to challenge the Kingswood outsourcing as an expenditure of municipal funds
alleged to be in violation of the Establishment Clause. As a threshold matter, we note
that Jefferson County is considered a municipality under Tennessee law. Weakley
County Mun. Elec. Sys. v. Vick, 309 S.W.2d 792, 804 (Tenn. Ct. App. 1957) (“Counties
in this State have always been held to be public municipal corporations with limited
powers, and liable as such.” (internal quotation marks omitted)); Jackson v. City of
Paris, 228 S.W.2d 1015, 1016 (Tenn. Ct. App. 1949). In addition, the Board did not
dispute on appeal that Forgety and Kucera were taxpayers of the municipality at the time
they brought suit. Finally, we note that Smith was not a taxpayer in Jefferson County
at the time the complaint was filed, as he had moved to Georgia to pursue another
teaching opportunity there. There is no danger of Smith’s tax dollars being spent in
violation of the Constitution. Thus, the doctrine of municipal-taxpayer standing may
apply only to Forgety and Kucera.

The Supreme Court recognizes three types of taxpayer standing: federal, state,
and municipal. All three categories of taxpayers must demonstrate that they were
injured, that the challenged action caused their injury, and that the court could provide
relief to redress that injury. D.C. Common Cause v. District of Columbia, 858 F.2d 1,
5 (D.C. Cir. 1988) (citing Allen v. Wright, 468 U.S. 737, 751 (1984)). In Frothingham
v. Mellon, 262 U.S. 447, 487 (1923), the Supreme Court held that federal taxpayers have
no standing to challenge the unconstitutional use of their tax dollars. The Court
reasoned that “[t]he administration of any statute, likely to produce additional taxation
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to be imposed upon a vast number of taxpayers, the extent of whose several liability is
indefinite and constantly changing, is essentially a matter of public and not of individual
concern.” Id.5 The Court has likewise refused to confer standing on state taxpayers who
show “merely that [they] suffer[] in some indefinite way in common with people
generally,” requiring them to raise a “good-faith pocketbook action” that involves “a
direct dollars-and-cents injury.” Doremus v. Bd. of Educ. of Borough of Hawthorne, 342
U.S. 429, 434 (1952).

Plaintiffs seeking to establish municipal-taxpayer standing are required to meet
a less rigorous injury standard than those seeking standing as federal or state taxpayers.
Unlike federal or state taxpayers, municipal taxpayers may fulfill the injury requirement
by pleading an alleged misuse of municipal funds. Frothingham, 262 U.S. at 486. The
Supreme Court has explained the rationale for its interpretation of the injury necessary
to establish municipal-taxpayer standing:

The interest of a taxpayer of a municipality in the application of its
moneys is direct and immediate and the remedy by injunction to prevent
their misuse is not inappropriate. It is upheld by a large number of state
cases and is the rule of this court. . . . The reasons which support the
extension of the equitable remedy to a single taxpayer in such cases are
based upon the peculiar relation of the corporate taxpayer to the
corporation, which is not without some resemblance to that subsisting
between stockholder and private corporation.

Id. at 486–87 (citations omitted). As we have noted, this reasoning “appears to rest on
the assumption that the relatively small number of taxpayers involved and the close
relationship between residents of a municipality and their local government results in a
direct and palpable injury whenever tax revenues are misused.” Taub v. Kentucky, 842
F.2d 912, 918 (6th Cir. 1988). Although this assumption could be questioned in an age

5
The Supreme Court carved out an exception to its rule against federal taxpayer standing in Flast
v. Cohen, 392 U.S. 83 (1968), which allowed such suits to challenge congressional expenditures alleged
to violate the Establishment Clause. Id. at 103–05. In Valley Forge, the Court clarified that this exception
did not apply to Congress’s transfer of property to religious institutions under the Property Clause. Valley
Forge, 454 U.S. at 479–80. In Hein v. Freedom from Religion Foundation, Inc., 551 U.S. 587 (2007), the
Court further clarified that the Flast exception would not extend to expenditures made by the Executive,
even when the funds were initially appropriated to the Executive’s discretionary budget by Congress. Id.
at 605–09. But none of these cases bear on municipal-taxpayer standing.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 15
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in which some cities boast populations in the millions, the rule “is one that the Supreme
Court has maintained for 86 years and one we have no authority to second guess.” Am.
Atheists, Inc. v. City of Detroit Downtown Dev. Auth., 567 F.3d 278, 287 (6th Cir. 2009);
see also DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 349 (2006) (noting that the issue
of municipal taxpayers’ standing to challenge a municipal tax exemption had not been
raised and that the plaintiffs could not “leverage the notion of municipal taxpayer
standing” to challenge a state franchise tax credit).

The defendants, however, argue that municipal taxpayers must show more than
an alleged misuse of municipal funds. They contend that a potential plaintiff must show
that the challenged government action resulted in a depletion of the municipal fisc.
Appellees Supp. Br. at 13–14. The theory is that only an action that reduces the
municipality’s total funds, and thereby increases the risk that taxes will be raised,
constitutes the dollars-and-cents pocketbook injury required by Doremus. Because the
school board actually saved money by outsourcing its alternative-education needs to
Kingswood, the defendants reason, the allegedly unconstitutional action could not
possibly result in higher municipal taxation, and the teachers thus have no cognizable
injury as taxpayers.

We reject the exhortation to apply this novel rule. There is no precedent for a
requirement that municipal taxpayers show that an unconstitutional act shrinks the public
treasury in order to establish standing. Indeed, any such rule would run directly counter
to case law from the Supreme Court, from this court, and from our sister circuits.

As noted above, the Supreme Court has clearly stated that “resident taxpayers
may sue to enjoin an illegal use of the moneys of a municipal corporation” and that “the
remedy by injunction to prevent their misuse is not inappropriate.” Frothingham, 262
U.S. at 486 (emphasis added); see also Doremus, 342 U.S. at 433–34 (quoting
Frothingham’s statement that a municipality’s taxpayers have a “direct and immediate”
interest “in the application of its moneys” and can sue based on “misuse” (internal
quotation marks omitted)); Taub, 842 F.2d at 918 (explaining municipal-taxpayer
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 16
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standing as based on the theory that such taxpayers suffer “a direct and palpable injury
whenever tax revenues are misused” (emphasis added)). On that basis, a municipal
taxpayer has standing to challenge any unconstitutional appropriation or expenditure,
regardless of whether more money would have been spent had the government remained
within constitutional bounds. Taxpayer standing in this context will not turn on whether
it was a bargain to violate the Constitution.

The idea that the unconstitutional spending of taxpayer money is itself an injury,
actionable at the municipal level even if not at the federal level, is rooted in the
stockholder analogy drawn by the Supreme Court in Frothingham. A person who owns
stock in a corporation values profitability, but she also has an interest in seeing her
money well spent by the corporate officers. “Like a shareholder of a private corporation,
a municipal taxpayer has an immediate interest in how the municipality spends resources
that reflect his contributions.” Am. Atheists, 567 F.3d at 285.6

The defendants’ argument under Doremus to suggest otherwise is misplaced
because that case concerned state-taxpayer standing and does not govern the case at bar.
In Doremus, state taxpayers challenged a New Jersey statute that provided for the
reading, without comment, of the Old Testament in public schools at the beginning of
each school day. Requiring the plaintiffs to establish that their suit was a “good-faith
pocketbook action,” the Court denied standing because “the grievance which it is sought
to litigate here is not a direct dollars-and-cents injury but is a religious difference.”
Doremus, 342 U.S. at 434. The Court, however, did not lay down any rules about
municipal-taxpayer suits, and has repeatedly construed Doremus as a state-taxpayer case.
See Hein v. Freedom from Religion Foundation, Inc., 551 U.S. 587, 600 (2007)
(describing Doremus as a case involving “a state taxpayer’s claim”); DaimlerChrysler

6
The dissent mischaracterizes our opinion as an expansion of municipal-taxpayer standing such
that “any county taxpayer [can] challenge any county action no matter whose interests are involved.” Slip
Op. at 42. But as American Atheists makes clear, municipal-taxpayer standing itself is a recognition that
constitutionally dubious municipal spending implicates the interests of each municipal taxpayer.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 17
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Corp. v. Cuno, 547 U.S. 332, 345 (2006) (same);7 id. at 354 (Ginsburg, J., concurring)
(same); ASARCO Inc. v. Kadish, 490 U.S. 605, 613 (1989) (same); United States v. City
of New York, 972 F.2d 464, 471 (2d Cir. 1992) (noting that Doremus involved state
taxpayers and finding nothing in the case “to convince us that Frothingham’s view of
municipal taxpayer standing is not still good law”).8 We implicitly recognized the limits
of Doremus’s reach in Taub, acknowledging the Supreme Court’s theory that municipal
taxpayers necessarily suffer when government money is misspent but denying state
taxpayers standing to challenge the spending of tax revenues to facilitate the construction
of an automotive assembly plant. Taub, 842 F.2d at 918–19.

We recognize that some circuits have invoked Doremus’s “good-faith
pocketbook action” language in cases involving municipal taxpayers, although never to
hold that standing depends on a net loss to the municipal fisc. See ACLU-NJ v. Twp. of
Wall, 246 F.3d 258, 262 (3d Cir. 2001); Koenick v. Felton, 190 F.3d 259, 263 (4th Cir.
1999); Clay v. Fort Wayne Cmty. Sch., 76 F.3d 873, 879 (7th Cir. 1996); Cammack v.
Waihee, 932 F.2d 765, 770 (9th Cir. 1991); D.C. Common Cause v. District of
Columbia, 858 F.2d 1, 4 (D.C. Cir. 1998). Their reasons for using Doremus’s language
have not been particularly convincing. The Third and Seventh Circuits appeared to
overlook the state/municipal distinction and to believe that Doremus itself applied its
new rule to municipal taxpayers. See ACLU-NJ, 246 F.3d at 262; Clay, 76 F.3d at 879.
The Fourth Circuit simply deferred to the Ninth Circuit. See Koenick, 190 F.3d at 263
(citing Cammack). The Ninth and D.C. Circuits relied on the Doremus Court’s citation
of Frothingham as evidence that the Court meant the pocketbook-injury requirement to
extend to municipal-taxpayer cases, Cammack, 932 F.2d at 770; D.C. Common Cause,

7
Contrary to the dissent’s assertion, we do not read DaimlerChrysler as “implicitly undo[ing]
previously applicable limits on municipal taxpayer standing.” Slip Op. at 44 n.1. Rather than altering
Doremus’s reach, DaimlerChrysler conformed to the Court’s longstanding interpretation of Doremus.
8
We note that two years later, in Thompson v. County of Franklin, 15 F.3d 245, 253 (2d Cir.
1994), the Second Circuit misread City of New York as “announc[ing] that an individual, municipal
taxpayer has standing to challenge the imposition of an allegedly illegal expenditure when she brings a
good-faith pocketbook action.” Thompson, 15 F.3d at 253 (internal quotation marks omitted). The
Thompson court appears to have focused on City of New York’s holding that an illegal expenditure sufficed
for standing and overlooked that it declined to invoke Doremus’s “pocketbook action” language in the
context of municipal taxpayers.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 18
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858 F.2d at 4, but nothing about Doremus’s citation of Frothingham suggests that
inference. In Doremus, the Court cited Frothingham’s two rules—that federal-taxpayer
standing generally is not permitted and that municipal-taxpayer standing to challenge
misuse of funds generally is permitted—before proceeding to craft rules for state
taxpayers. In doing so, the Court made no more mention of municipal taxpayers and
instead noted the application to both federal and state taxpayers of the rule that common,
indefinite suffering is insufficient for standing. Doremus, 342 U.S. at 434. Far from
drawing together state- and municipal-taxpayer standing, the Court linked state- and
federal-taxpayer standing. See id. (“[W]e reiterate what the Court said of a federal
statute as equally true when a state Act is assailed . . . .”). Finally, the Ninth Circuit
pointed to the fact that the Doremus Court, after declaring that state taxpayers must show
a direct injury resulting from an allegedly invalid statute to establish standing, felt the
need to “harmonize[] its announced rule with a school district taxpayer case,” Everson
v. Board of Education of Ewing Township, 330 U.S. 1 (1947). Cammack, 932 F.2d at
770. In Everson, the Court assumed that school-district taxpayers had standing to
challenge a board of education’s decision to reimburse the parents of parochial-school
children for busing costs. The Doremus Court’s citation of Everson is a precarious basis
on which to extend the pocketbook-injury requirement, however. Doremus cited
Everson just after it held that taxpayers had to establish a direct injury to challenge “a
state Act.” Doremus, 342 U.S. at 434. The Doremus Court likely cited Everson because
the plaintiffs in Everson had also challenged the state statute authorizing the board to
make rules for school transportation. Thus, the Everson case was relevant in Doremus
because it involved a challenge to state law, not because it involved a municipal-
taxpayer challenge to municipal action. Certainly, if the Court had intended the
pocketbook-injury requirement to apply to municipal taxpayers, it could have said so
much more directly.9

9
A panel of this court cited Doremus in the context of a municipal-taxpayer case in Hawley v.
City of Cleveland, 773 F.2d 736 (6th Cir. 1985), but only for the uncontroversial proposition that there
exists “a distinction between the requirements of taxpayer standing in suits by federal taxpayers and suits
by municipal taxpayers.” Id. at 741. More recently, a panel of this court cited Doremus’s “dollars-and-
cents injury” language in American Atheists. 567 F.3d at 285. But that case neither explicitly extended
Doremus to municipal taxpayers nor depended for its result on the application of the good-faith
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 19
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More importantly, while some of our sister circuits have cited Doremus’s
pocketbook-injury language in municipal-taxpayer cases, they have not applied it in the
way that the defendants urge. None has required municipal taxpayers to show a
depletion of public funds to reach the courthouse door. To the contrary, all agree that
the unconstitutional expenditure of government funds can itself be injury enough to
confer municipal-taxpayer standing. See Koenick, 190 F.3d at 263 (applying the
principle that “a municipal taxpayer has standing in cases where the litigant’s only injury
is the alleged improper expenditure of municipal funds”); City of New York, 972 F.2d
at 466 (holding that “municipal taxpayers do have standing to challenge municipal
expenditures even where there is no likelihood that resulting savings will inure to the
benefit of the taxpayer”); Cammack, 932 F.2d at 770 (“[W]e conclude that municipal
taxpayer standing simply requires the ‘injury’ of an allegedly improper expenditure of
municipal funds . . . .”); D.C. Common Cause, 858 F.2d at 5 (“The Supreme Court has
never required state or municipal taxpayers to demonstrate that their taxes will be
reduced as a result of a favorable judgment.”); Donnelly v. Lynch, 691 F.2d 1029, 1031
(1st Cir. 1982) (in suit involving Christian nativity scene in city-sponsored Christmas
display on public property, finding standing based on the longstanding rule that
municipal taxpayers can challenge “allegedly unconstitutional use of their tax dollars”),
rev’d on other grounds, 465 U.S. 668 (1984); cf. ACLU-NJ, 246 F.3d at 263–64
(denying taxpayer standing because the plaintiffs failed to show that the maintenance of
a religious holiday display near the entrance of a government building involved an
expenditure); Doe v. Duncanville Indep. Sch. Dist., 70 F.3d 402, 408 (5th Cir. 1995)
(denying taxpayer standing where there was no evidence that the school district spent
any funds on the distribution in school of Bibles, which were simply left on a table in the
school by the Gideons); Freedom from Religion Found., Inc. v. Zielke, 845 F.2d 1463,
1470 (7th Cir. 1988) (denying taxpayer standing where there was no evidence that the
city had used tax revenues to maintain a display of the Ten Commandments in a public
park).

pocketbook-injury requirement, and any such extension would not be binding on the en banc court.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 20
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This approach is perfectly consistent with our own case law, which has conferred
standing on municipal taxpayers who challenge government expenditures that allegedly
violate the Constitution. In American Atheists, we explained that “[o]nly if the
challenged local government action involves neither an appropriation nor expenditure
of city funds will the municipal taxpayer lack standing, for in that case he will have
suffered no ‘direct dollars-and-cents injury.’” Am. Atheists, 567 F.3d at 285. We held
that municipal taxpayers had standing to challenge grants given to three churches as part
of a downtown revitalization project, reasoning that “[a]ll that matters is that American
Atheists alleges that Detroit—a city—misspent taxes its members have paid.” Id. at 286;
cf. Pedreira v. Ky. Baptist Homes for Children, Inc., 579 F.3d 722, 731 (6th Cir. 2009)
(holding that state taxpayers had standing to challenge state funding of a home for at-risk
children that allegedly used the funds for religious activities); id. at 733 (listing cases in
which courts “have upheld taxpayer standing when grants, contracts, or other tax-funded
aid are provided to private religious organizations pursuant to explicit legislative
authorization”).

Undeterred, the defendants cite our decision in Hawley v. City of Cleveland, 773
F.2d 736 (6th Cir. 1985), in support of their contention that an expenditure of municipal
funds will not suffice for standing unless that expenditure entails the depletion of the
public fisc. The citation is misleading. Hawley is part of a line of cases in which the
alleged injury was not the spending of tax money, but the failure to collect it in the first
place. In Hawley, Cleveland taxpayers sued to enjoin the local airport’s lease of space
to the Catholic Diocese for use as a chapel at an allegedly below-market rate. We
concluded that standing existed on the theory that the lease to the diocese may have
brought the city less money than it would have earned renting the space to another entity.
Hawley, 773 F.2d at 741–42. Similarly, in Steele v. Industrial Development Board, No.
93-5350, 1994 WL 599458, at *1 (6th Cir. Nov. 1, 1994) (unpublished opinion), we
granted municipal taxpayers standing to challenge the issuance of tax-exempt bonds to
a church-run university, again on the basis of reduced revenues flowing into the city’s
coffers. And in Johnson v. Economic Development Corp. of the County of Oakland, 241
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 21
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F.3d 501, 508–09 (6th Cir. 2001), we held that the loss of revenue potentially incurred
by the issuance of tax-exempt bonds to finance construction at a Catholic school gave
state taxpayers standing to sue. In each of these cases, standing necessarily was linked
to the plaintiffs’ tax burden: as they had no direct interest in the conferral of tax breaks
on third parties—that is, in the treatment of other people’s money—they could state an
injury based only on the potential that their own taxes might rise as a consequence. The
same cannot be said of expenditure cases, in which taxpayers can articulate the separate
injury that the government is spending their tax money illegally. Such plaintiffs
complain not that the government, having spent certain money, might demand more of
them, but rather that it has misspent what it has already collected.

In sum, the rule that plaintiffs must show depletion of the public fisc in order to
access the courts has no foundation, explicit or implied, in the binding decisions of the
Supreme Court. And with good reason. Determining whether a municipality “lost” or
“saved” money raises a host of implementation problems. Consider the Kingswood
contract. One method to calculate depletion is to compare the average yearly cost of the
Kingswood contract with the average yearly cost of the alternative public school during
its final five years. But the results might differ if the court compares the last year of the
alternative school with the first year of Kingswood. Moreover, because both methods
rely on past costs, neither would prove reliable if the market for alternative schools
changes. The Kingswood contract might “save” the municipality money in the short
term, but five years from now, the (now-closed) alternative public school might be the
more cost-effective option. There is no principled way to determine what costs or
savings we should compare and over what time period we should compare them.

The Court has specifically carved out an expansive understanding of taxpayer
standing at the municipal level, Frothingham, 262 U.S. at 486–87, and the imposition
of the defendants’ rule would have the peculiar contrary effect of rendering municipal-
taxpayer standing narrower than federal-taxpayer standing in some cases. Had Congress
taken the action at issue here, federal taxpayers surely would have standing under Flast,
which did not require that unconstitutional spending result in a net loss to the federal
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 22
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treasury. By the same token, a local government should not be able to evade suit simply
because it was cheaper to violate the Constitution. Because Forgety and Kucera allege
that the county spent their tax dollars in violation of the Constitution when it outsourced
alternative education to Kingswood—and regardless of whether the county would have
spent more to follow the law—they meet the injury element of standing as municipal
taxpayers under Frothingham.

We turn, then, to the requirements of causation and redressability. When
plaintiffs’ sole request for relief is an order enjoining the conduct at issue, “causation
and redressability are essentially identical requirements.” D.C. Common Cause, 858
F.2d at 5 (citing Allen, 468 U.S. at 753 n.19). The D.C. Circuit has explained how to
apply these elements to taxpayers who challenge an unconstitutional expenditure:

The taxpayer’s injury is not the payment of taxes, for which the only cure
would be a rebate or reduction in taxes. Just as the shareholder need not
prove that the funds he claims the Board of Directors has misapplied will
be returned to him as a dividend, so the taxpayer need not show that the
specific taxes he paid were used unlawfully, nor that his taxes will be
reduced as a result of the judgment. By enjoining an illegal expenditure,
the court can redress the taxpayer’s injury caused by the misuse of public
funds and ensure that the funds will be devoted to lawful purposes of
possible benefit to the taxpayers.

Id. at 5. On this persuasive reasoning, we hold that Forgety and Kucera meet the
causation and redressability requirements of Article III. Accordingly, they have
established municipal-taxpayer standing. The district court erred in implicitly
concluding otherwise.

With respect to the teachers’ Establishment Clause claims under the U.S.
Constitution, we REMAND the case to the district court for further proceedings
consistent with this opinion. We also REMAND the teachers’ Establishment Clause
claims under the Tennessee Constitution for the district court to consider in the first
instance.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 23
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C. Procedural Due Process

In addition to their Establishment Clause claim, the teachers also raise a
procedural-due-process claim. The district court did not analyze this claim; instead, it
granted summary judgment to the Board based on its holding that the teachers failed to
pursue their post-deprivation remedies. The teachers argue that their property rights
include “the right not to be dismissed by abolition except in compliance with state law.”
Appellants Br. at 33–34. Also, the teachers contend that their positions were not
abolished, but, rather, were improperly delegated. The Board asserts that even if the
teachers could establish a property interest in their positions, nonetheless the teachers
received all of the process that they were due because the Board was acting in a
legislative capacity when it abolished the alternative school.

Analysis of the teachers’ procedural-due-process claim involves two steps:
establishing whether the teachers have a property interest in their positions, and
determining what process (if any) is due them. Leary v. Daeschner, 228 F.3d 729, 741
(6th Cir. 2000). However, even if we assume that the teachers have property interests
in their teaching positions, we cannot conclude that the Board violated the teachers’
procedural-due-process rights because of the nature of the Board’s activities. In order
to determine whether the teachers received due process, the facts of the case require us
to categorize the actions of the Board as it went through the budgetary process that led
to the abolishment of the alternative school.

When examining the activities of an entity such as the Board, “‘[w]e find little
guidance in formalistic distinctions between “legislative” and “adjudicatory” or
“administrative” government actions.’” Nasierowski Bros. Inv. Co. v. City of Sterling
Heights, 949 F.2d 890, 896 (6th Cir. 1991) (quoting Harris v. County of Riverside, 904
F.2d 497, 501–02 (9th Cir. 1990)). “Whether an act is legislative turns on the nature of
the act, rather than on the motive or intent of the official performing it.” Bogan v. Scott-
Harris, 523 U.S. 44, 54 (1998); see also Nasierowski, 949 F.2d at 896. Legislative
functions involve “integral steps in the legislative process.” Bogan, 523 U.S. at 55. In
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 24
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Bogan, the “hallmarks of traditional legislation” were described as “a discretionary,
policymaking decision implicating the budgetary priorities of the city and the services
the city provides to its constituents,” and actions that terminate a position “may have
prospective implications that reach well beyond the particular occupant of the office.”
Id. at 55–56. No notice or hearing is required before legislative action. 37712, Inc. v.
Ohio Dep’t of Liquor Control, 113 F.3d 614, 619 (6th Cir. 1997) (citing United States
v. Fla. E. Coast Ry. Co., 410 U.S. 224, 244–45 (1973)). “[L]egislation normally is
general in its scope rather than targeted on a specific individual, and its generality
provides a safeguard that is a substitute for procedural protections.” Ind. Land Co., LLC
v. City of Greenwood, 378 F.3d 705, 710 (7th Cir. 2004).

Because the Board engaged in legislative activity when it made the budgetary
determinations that eliminated the alternative school, we hold that the Board did not
violate the teachers’ procedural-due-process rights. The Board’s decision to abolish the
alternative school and contract with Kingswood in order to save money was the result
of weighing budgetary priorities, a legislative activity. See Bogan, 523 U.S. at 55–56.
Thus, because the Board was engaged in a legislative activity, there was no requirement
that the teachers be given notice or an opportunity to be heard prior to the Board’s
decision to abolish the alternative school. See 37712, Inc., 113 F.3d at 619. In such
circumstances, “the legislative process provides all the process that is constitutionally
due” when a plaintiff’s alleged injury results from a legislative act “of general
applicability.” 75 Acres, LLC v. Miami-Dade County, 338 F.3d 1288, 1292 (11th Cir.
2003). Therefore, we hold that the Board’s actions did not violate the teachers’
procedural-due-process rights.

D. Substantive Due Process

In addition to their procedural-due-process claim, the teachers raise a
substantive-due-process claim. The district court concluded that “all substantive due
process claims collapse into the decision on the plaintiffs’ First Amendment . . .
Establishment Clause claim[].” J.A. at 73 (Dist. Ct. Op. at 13). The teachers argue that
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 25
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“[a]lthough substantive due process protections are limited, Plaintiffs may, in the context
of a § 1983 action, establish a substantive due process claim when some state action has
deprived them of a particular constitutional guarantee.” Appellants Br. at 43. The
teachers contend that the record demonstrates that their positions were not eliminated,
but “merely delegated to a religious organization” in violation of the Establishment
Clause. Id. at 33–34. The Board, however, argues that because the teachers alleged a
violation of the Establishment Clause, they may not recover under the generalized
concept of substantive due process.

Substantive-due-process challenges usually do not survive if a provision of the
Constitution directly addresses the allegedly illegal conduct at issue. Montgomery v.
Carter County, 226 F.3d 758, 769 (6th Cir. 2000). We have observed that

the Supreme Court has repeatedly cautioned that the concept of
substantive due process has no place when a provision of the
Constitution directly addresses the type of illegal governmental conduct
alleged by the plaintiff. See, e.g., Graham v. Connor, 490 U.S. 386,
394–95 (1989) (concluding that the reasonableness or unreasonableness
of force used by police during an investigatory stop or arrest must be
analyzed as a Fourth Amendment claim, rather than under “the more
generalized notion of ‘substantive due process’”).

Id. Because the teachers’ Establishment Clause claim directly addresses the conduct at
issue, we affirm the district court’s decision to dismiss the teachers’ substantive-due-
process claim.

E. Legislative Immunity

The Board members raise legislative and qualified immunity as defenses to the
claims brought against them by the teachers. Having granted summary judgment to the
Board on all of the teachers’ claims, the district court held that the Board members’
defenses of legislative and qualified immunity were moot. However, because we are
remanding the Establishment Clause claim to the district court, we must consider the
parties’ arguments regarding immunity. Because we hold that the Board members are
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entitled to legislative immunity, we do not need to address their claim that they are
entitled to qualified immunity.

The teachers argue that the individual Board members are not legislators, and
that their actions were void under Dillon’s Rule.10 However, the Board members
respond that they were performing a legislative function when they abolished the school,
and, therefore, they should be granted legislative immunity. The Board members did not
address the teachers’ Dillon’s Rule argument.

We recognize that local legislators can be sued both in their individual and in
their official capacities. Although plaintiffs may sue a local legislator in his or her
official capacity under § 1983, local legislators may invoke legislative immunity to
insulate themselves as individuals from liability based on their legislative activities.
Bogan, 523 U.S. at 49; Canary v. Osborn, 211 F.3d 324, 328 (6th Cir. 2000) (citing
Bogan, 523 U.S. at 49); Minton v. St. Bernard Parish Sch. Bd., 803 F.2d 129, 134–35
(5th Cir. 1986) (holding that absolute legislative immunity would shield officials from
liability in their individual capacity). In other words, local legislators will not face
personal liability for their legislative activities. “The immunity granted . . . applies
whether the relief sought is money damages[,] or [declaratory or] injunctive relief.” Alia
v. Mich. Supreme Court, 906 F.2d 1100, 1102 (6th Cir. 1990); see Supreme Court of Va.
v. Consumers Union of U.S, Inc., 446 U.S. 719, 732–33 (1980). Officials who are not
part of the legislature “are entitled to legislative immunity when they perform legislative
functions.” Bogan, 523 U.S. at 55.

10
“‘Dillon’s Rule’ originated with John F. Dillon, former Chief Justice of the Supreme Court of
Iowa and former circuit judge for The United States Eighth Judicial Circuit.” Williams v. Town of Hilton
Head Island, 429 S.E.2d 802, 804 n.1 (S.C. 1993) (citing John F. Dillon, Commentaries on the Law of
Municipal Corporations (5th ed.), § 237, p. 448 (1911)). The state of Tennessee uses Dillon’s Rule as a
canon of statutory construction when determining the authority of a municipality. Arnwine v. Union County
Bd. of Educ., 120 S.W.3d 804, 807 (Tenn. 2003). Under Dillon’s Rule, a municipal government has
“authority to act only when: (1) the power is granted in the express words of the statute, private act, or
charter creating the municipal corporation; (2) the power is necessarily or fairly implied in, or incident to,
the powers expressly granted; or (3) the power is one that is neither expressly granted nor fairly implied
from the express grants of power, but is otherwise implied as essential to the declared objects and purposes
of the corporation.” Id. at 807–08 (internal quotation marks, emphasis, and brackets omitted).
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 27
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Because we determined in our analysis of the teachers’ procedural-due-process
claim that the Board was performing a legislative function, we conclude that the
members of the Board are entitled to legislative immunity in their individual capacities.
See id. As noted above, the Board members did not need to be members of the
legislature in order to enjoy legislative immunity. Id. The teachers, however, have
argued that even if we find the actions of the Board to be legislative in nature, Dillon’s
Rule should prevent application of legislative immunity in this case. Even if the Board
did not have the power to abolish the alternative school under Tennessee law, the Board
members may still enjoy legislative immunity as individuals in federal court for their
legislative actions, sound or unsound. See R.S.W.W., Inc. v. City of Keego Harbor, 397
F.3d 427, 438 (6th Cir. 2005) (citing Shoultes v. Laidlaw, 886 F.2d 114, 117 (6th Cir.
1989) for the proposition that even if an ordinance is held to be invalid, officials acting
in their legislative capacities are absolutely immune from suit). Legislative immunity
exists so that individuals can feel more comfortable volunteering to perform public-
service functions, such as serving on their local school board. Because “the threat of
liability may significantly deter service in local government, where prestige and
pecuniary rewards may pale in comparison to the threat of civil liability,” Bogan, 523
U.S. at 52, legislative immunity continues to play an important role. Therefore, we hold
that the Board members may be sued in their official capacities but may not be sued as
individuals for money damages or declaratory or injunctive relief. Because the Board
members are entitled to legislative immunity with respect to the claims made against
them in their individual capacities, we need not address qualified immunity, which also
is a doctrine applicable only in the context of individual-capacity suits.

III. CONCLUSION

For the reasons discussed above, we AFFIRM the district court’s conclusion that
Smith did not have standing, but REVERSE its conclusion as to Forgety and Kucera,
who have standing to bring suit as municipal taxpayers seeking to prevent misuse of
their tax dollars. We REMAND the case to the district court for further proceedings
consistent with this opinion.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 28
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Because we hold that the Board was performing a legislative function when it
abolished the alternative school, we AFFIRM the district court’s grant of summary
judgment to the Board on the teachers’ procedural-due-process claim. In addition,
because we hold that the Establishment Clause claim adequately addresses the alleged
substantive-due-process violation, we AFFIRM the district court’s dismissal of this
claim.

As to the Board members’ legislative- and qualified-immunity defenses, we
REVERSE the district court’s determination that the issue whether the Board members
qualify for these protections is moot. We hold that the Board members are entitled to
legislative immunity on the individual-capacity claims because their decisions about the
budget were legislative in nature. Because we conclude that legislative immunity
applies to the individual-capacity claims against the named Board members, we need not
analyze whether the Board members are entitled to qualified immunity.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 29
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_____________________________________________________

CONCURRING IN FULL IN THE MAJORITY OPINION
_____________________________________________________

BOYCE F. MARTIN, JR., Circuit Judge, joined by KAREN NELSON MOORE,
Circuit Judge, concurring in full in the majority opinion. I join the majority opinion in
full and write only to provide context to the factors identified in Judge Sutton’s critique
of the municipal-taxpayer standing doctrine. Judge Sutton’s concurring opinion faults
municipal-taxpayer standing because, today, the distinction between municipalities and
states does not reflect a categorical difference in population size. The concurrence is
correct with respect to these population differences. However, large cities and small
states are not new to this country. In fact, the population differences between
municipalities and states were more pronounced in the Roaring Twenties when the
Supreme Court announced the doctrine of municipal-taxpayer standing in Frothingham
v. Massachusetts, 262 U.S. 447 (1923), than they are today. The 1920 census reflected
that eighty-nine cities were more populous than Nevada, the least populous state at the
time. See U.S. Census Bureau, Demographic Trends in the 20th Century, at A-1 (2002),
available at www.census.gov/prod/2002pubs/censr-4.pdf; Population Division,
U.S. Census Bureau, Population of the 100 Largest Cities and Other
Urban Places in the United States: 1790 to 1990, at Table 15 (Population
Division, Working Paper No. 27, 1998), available at
www.census.gov/population/www/documentation/twps0027/twps0027.html. However,
as Judge Sutton notes in his concurring opinion, now only thirty-two cities are more
populous than the least populous state. Concurring Op. at 32 (Sutton). Similarly, Judge
Sutton notes that thirty-nine states presently have populations smaller than the
population of New York City. Id. However, in 1920, the number was forty-four. U.S.
Census Bureau, Demographic Trends in the 20th Century, at A-1; Population Division,
U.S. Census Bureau, Population of the 100 Largest Cities and Other Urban Places in
the United States: 1790 to 1990, at Table 15. Although Judge Sutton is correct that
many cities are larger than states, because this is not a new phenomenon, I do not believe
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this requires changes to our well-established doctrine of municipal-taxpayer standing.
Moreover, to the extent this data is at all relevant to the issue of municipal-taxpayer
standing, these changes suggest that the distinction between standing based on being a
resident of a state and a municipality is more pronounced now than it was previously.

Similarly, developments in constitutional and prudential standing over the last
century also do not warrant such a change. Judge Sutton’s concurrence argues that
plaintiffs who were not present in the religious school have not suffered the type of
injury against which the Establishment Clause protects. That argument misapprehends
the nature of the plaintiffs’ injury. The injury to the plaintiffs was not witnessing the
result of the expenditure, but the expenditure itself. Paying taxes that are used to support
religion is precisely the type of injury that the Establishment Clause guards against. See
Flast v. Cohen, 392 U.S. 83, 103 (1968) (“[T]he same authority which can force a citizen
to contribute three pence only of his property for the support of any one establishment,
may force him to conform to any other establishment in all cases whatsoever.” (quoting
James Madison)). Although the plaintiffs endured their injury alongside all other
taxpayers in their municipality, their personal tax payments were particularized losses.
The undertone of the concurrence’s argument is that the tax loss suffered by an
individual plaintiff is too small to be cognizable. However, even nominal damages
suffice for purposes of standing. See Lynch v. Leis, 382 F.3d 642, 646 n.2 (6th Cir.
2004) (applying 42 U.S.C. § 1988 and citing Buckhannon Bd. & Care Home, Inc. v. W.
Va. Dep’t of Health & Human Res., 532 U.S. 598, 604 (2001), and Carey v. Piphus, 435
U.S. 247, 266 (1978)). Additionally, the majority opinion, which Judge Sutton concurs
in, holds that whether the unconstitutional disbursement actually saved the taxpayers
money is irrelevant in determining standing. Therefore, although the standing doctrine
has unquestionably changed, I do not believe these changes have any impact on
municipal-taxpayer standing.

Finally, the varied sources that combine to fund municipal treasuries discussed
in Judge Sutton’s concurrence also do not affect the viability of this doctrine. From the
perspective of a municipal taxpayer, funding unconstitutional conduct may be cheap
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 31
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because other sources subsidize the expenditures. But, municipal-taxpayer standing has
never hinged on the amount by which an expenditure would affect the municipal
treasury. So long as municipal funds are at stake, the amount of loss is irrelevant. An
injury has occurred and standing exists whether a municipality unconstitutionally spends
$1,000,000 with ten percent of the funding originating in municipal taxes, or $100,000
entirely from municipal taxes. Therefore, even in light of the circumstances Judge
Sutton identifies, I do not find the propriety of our long-established doctrine of
municipal standing difficult to grasp or its justification in need of reconsideration.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 32
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_____________________________________________________

CONCURRING IN FULL IN THE MAJORITY OPINION
_____________________________________________________

SUTTON, Circuit Judge, concurring. I join the majority opinion in full and write
separately (1) to identify a tension between the municipal-taxpayer-standing doctrine and
modern standing principles and (2) to elaborate why the doctrine applies to a local
expenditure that purports not to increase any burden on the local public fisc but to save
money.

1. Whatever the virtue of a line between state- and municipal-taxpayer standing
at its birth 88 years ago, see Frothingham v. Mellon, 262 U.S. 447 (1923), the point of
the demarcation is difficult to grasp today. Start with the reality that it is hard to draw
a meaningful distinction between the stakes of taxpayers in litigation based solely on
geography, whether in 1923 or today. Thirty-two cities currently have populations larger
than at least one State, and New York City, the largest municipality in the country, holds
more people than 39 States. See Am. Atheists, Inc. v. City of Detroit Downtown Dev.
Auth., 567 F.3d 278, 286 (6th Cir. 2009). If the point of limiting taxpayer standing is to
avoid the resolution of “generalized grievances” in federal court, see Hein v. Freedom
from Religion Found., Inc., 551 U.S. 587, 600 n.2 (2007), why does a New Yorker have
standing based on an injury shared with 8,275,000 others while a resident of North
Dakota lacks standing based on an injury shared with 647,000 others? See Population
Division, U.S. Census Bureau, Annual Estimates of the Resident Population for the
United States, Regions, States & Puerto Rico (2009), available at
http://www.census.gov/popest/states/NST-ann-est.html; Population Division, U.S.
Census Bureau, Annual Estimates of the Population for Incorporated Places over
100,000 (2007), available at http://www.census.gov/popest/cities/SUB-EST2007.html.
If a state taxpayer has not “sustained” or is not “immediately in danger of sustaining
some direct injury as a result” of enforcement of an allegedly unconstitutional law and
“merely . . . suffers in some indefinite way in common with people generally,” Doremus
v. Bd. of Educ., 342 U.S. 429, 434 (1952) (internal quotation omitted), why isn’t the
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same true for a meaningful number of city taxpayers? The gross population of the
largest 37 cities (41.7 million) after all is roughly the same as the gross population of the
23 smallest States. See U.S. Census Resident Population, supra; U.S. Census
Incorporated Places, supra.

While the municipal-taxpayer doctrine has stood still, moreover, standing
principles have moved on. In the last few decades, the Court has made it clear that “[a]
plaintiff must allege personal injury fairly traceable to the defendant’s allegedly
unlawful conduct and likely to be redressed by the requested relief.” Allen v. Wright,
468 U.S. 737, 751 (1984). Yet how has a municipal taxpayer, whether from a large city
or a small one, suffered a “personal injury” traceable to the passage of a general law
merely because the law requires an appropriation of some money, and usually an
infinitesimal amount of money from the taxpayer? Standing law safeguards the
separation of powers through the injury-in-fact requirement, insisting that a claimant
“raising only a generally available grievance about government . . . does not state an
Article III case or controversy.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 574,
576–77 (1992). Yet how has a municipal-taxpayer claimant not done just that: raised
nothing more than a claim that the municipality must follow the law? “[C]onvert[ing]
the undifferentiated public interest in [government’s] compliance with the law into an
‘individual right’ vindicable in the courts . . . would enable the courts . . . to become
virtually continuing monitors of the wisdom and soundness of [government] action.” Id.
at 577. Yet if that is so, shouldn’t federal courts insist that claimants challenging the
validity of federal, state and municipal laws do more to establish injury in fact,
traceability and redressability than allege that they paid their taxes?

Just as the state/city taxpayer dichotomy has grown more curious since
Frothingham, so too has the gap in reasoning between the municipal-taxpayer-standing
doctrine and prudential limitations on standing, namely that a claimant must suffer the
type of injury that the constitutional provision at issue protects. See Valley Forge
Christian Coll. v. Ams. United for Separation of Church & State, Inc., 454 U.S. 464, 475
(1982). The municipal-taxpayer-standing doctrine pays heed only to the taxes paid, not
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 34
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to the nature of the constitutional claim. Here, as a result, the doctrine has permitted
teachers who never witnessed anything remotely creating an Establishment Clause
violation (because they taught at the old non-religious school, not at the new religious
one) to challenge the law, even though the claimants seemingly could not satisfy
prudential standing limitations. See Maj. Op. at 10–12; Barrows v. Jackson, 346 U.S.
249, 256 (1953).

One other oddity surrounds the doctrine. Perhaps in 1923 it was easy to speak
of city and state treasuries as distinct. Yet today, particularly in the context of a public
school case, it is pure fiction to think of municipal (or county) treasuries as holding
money raised only through local taxes. Most city budgets contain state and federal
dollars, often substantial sums of them, and many school district budgets consist
primarily of state and federal dollars. On average, the federal government supplies 8.5%
of the public school system funds, the state governments 48.7% of the funds and local
sources 42.8% of the funds. At one extreme, local funds in Hawaii make up just 1.7%,
while state sources account for more than 90%. Nat’l Center for Education Statistics,
Revenues & Expenditures for Public Elementary and Secondary Education: School Year
from 2002–03, tbl.2 (2005). Because the Court has long shown a concern for developing
a “principled way of distinguishing” claimants with standing from those without it,
DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 348 (2006), there is much to be said for
reconsidering the municipal-taxpayer-standing doctrine or, if not that, at least for
recalibrating it to account for the world the way it is.

Save for one thing: The Supreme Court created the distinction and has stood by
it for some time, requiring lower courts like ours to apply it as is. See Rodriguez de
Quijas v. Shearson/Am. Express, Inc., 490 U.S. 477, 484 (1989). The Court suggested
the doctrine in Crampton v. Zabriskie, 101 U.S. 601 (1879), and formally adopted it in
Frothingham v. Mellon, 262 U.S. 447 (1923), explaining that municipal taxpayers, like
the shareholders of a private corporation, have an immediate interest in how the
municipality spends the resources they contributed to the entity. Id. at 487. In Doremus
v. Board of Education, 342 U.S. 429 (1952), the Court clarified the other side of the
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coin—that state taxpayers (and federal ones as well) have no such standing based on
taxpayer status alone. And in 2006, the Court left no doubt about the continuing
relevance of the distinction, when all nine members of the Court applied it to a case on
review from this court. See Cuno, 547 U.S. at 345, 349–50; id. at 354 (Ginsburg, J.,
concurring). If any modification to the doctrine is appropriate, it must come from the
Court.

2. Under current law, the municipal-taxpayer-standing doctrine applies to all
appropriations, even those that purport to be “cost-saving measures.” Pet. Rehearing at
12; see Dissent at 5. A contrary approach would force litigants and courts to determine
at a fixed point in time, presumably when the lawsuit is filed, whether a law designed
to be implemented over a period of years will net out in the black or in the red. That
asks a lot, and more perhaps than the federal courts can deliver. As the majority
correctly points out, a net-loss requirement raises a host of insurmountable
implementation problems.

The roots of the municipal-taxpayer-standing doctrine in corporate law pose a
conceptual problem as well. Let us assume for the sake of argument that the Kingswood
contract violates the Establishment Clause and that the unconstitutional expenditures
may one day amount to local “savings.” Would a fiduciary’s illegal expenditures be
beyond reproach if the same could be said about a company’s spending decisions—that
the illegal acts eventually would save the company money? I don’t think so, and the
same should be true here. If a corporate fiduciary misspends shareholder funds, his
liability (as opposed to any damages) does not turn on whether he can show that the
expenditures turned into a good investment or a bad one. Imagine a fiduciary defending
a breach on the ground that, in the year before the illegal expenditure, the corporation
foolishly, but legally, spent more money on a related program or on the ground that
deflation insulated the breach from liability. That is not how it works. An appropriation
is an appropriation, and if it violates fiduciary duties or the Establishment Clause, a
shareholder or a city taxpayer, as the case may be, may challenge the expenditure under
current law.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 36
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___________________________________________________

CONCURRING IN PART AND DISSENTING IN PART
___________________________________________________

ALICE M. BATCHELDER, Chief Judge, concurring in part and dissenting in
part. While I join Part II.C (procedural due process) and Part II.D (substantive due
process) of the majority opinion, I cannot agree with the majority’s conclusion that
Plaintiffs have municipal taxpayer standing. I therefore join Judge Rogers’ dissent with
respect to that issue. Because I do not believe that Plaintiffs have standing to bring their
Establishment Clause claims, I would affirm the district court’s judgment dismissing
those claims, I would not reach the question of legislative immunity, and I therefore do
not join Part II.E of the majority opinion. I write separately only to note my
disagreement with the majority’s analysis of individual Article III standing and with its
conclusion that Plaintiffs may have a sufficiently close relationship with the students at
the alternative school to satisfy the first prong of prudential standing.

As the majority correctly states, every plaintiff must satisfy both constitutional
and prudential standing requirements in order to bring an individual, first-party claim in
federal court. To meet the constitutional minimum a plaintiff must show:

(1) it has suffered an “injury in fact” that is (a) concrete and
particularized and (b) actual or imminent, not conjectural or hypothetical;
(2) the injury is fairly traceable to the challenged action of the defendant;
and (3) it is likely, as opposed to merely speculative, that the injury will
be redressed by a favorable decision.

Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180–81 (2000);
see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61 (1992).

Both Plaintiffs and Defendants agree that each of the teachers has suffered an
injury; each lost his or her position at the alterative school and the attendant benefits.
Supp. Br. for Pl. at 8; Supp. Br. for Appellants at 9. This injury hits in the pocketbook,
it is classically “concrete,” “particularized,” and “actual,” and therefore satisfies the
‘injury in fact’ requirement. See Lujan, 504 U.S. at 560.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 37
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These individual injuries, however, are not “fairly traceable to [Defendants’]
challenged action.” Plaintiffs claim that the Board violated the Establishment Clause
when it outsourced the alternative school to Kingswood for 2003–2004. That decision
is the “challenged action of the defendant[s].” That decision, however, did not cause the
teachers to lose their jobs. Their jobs were terminated when the Board voted to abolish
the Board-run alternative school, a decision separate and distinct from the Board’s later
decision to contract with Kingswood. Both the Board’s legal authority and the
undisputed record make clear that Plaintiffs would have lost their jobs regardless of
where the Board decided to place the alternative school program.

As a matter of Tennessee law, nothing about the Board’s decision to abolish its
own school compelled it to then contract with Kingswood. The majority is correct that
the Board was required by Tennessee law to maintain at least one alternative school, see
Maj. Op. at 9 n.3, but ignores the fact that the Board had broad discretion as to how to
fulfill that mandate. After abolishing its own school, the Board was free to contract with
a school such as Kingswood, make an arrangement with another school board to provide
a joint alternative school, or “send its suspended or expelled students to any alternative
school already in operation.” Tenn. Code Ann. §§ 49-2-203(b)(12), 49-6-3402(a), 49-6-
3402(h)(1) (2009). The wide range of options available to the Board is consistent with
Tennessee’s legislative choice to “grant[] broad discretionary powers to the county
Board of Education to . . . govern[] the public schools as the Board deems advisable.”
Morrison v. Hamilton County Bd. of Educ., 494 S.W.2d 770, 772 (Tenn. 1973); see State
ex rel. Thompson v. Marion County Bd. of Educ., 302 S.W.2d 57, 59 (Tenn. 1957); see
also Tenn. Code Ann. § 49-2-203(a)(2) (2009).

The record bears out the distinction between the two Board decisions. The
Board’s choice of Kingswood was clearly related in time to the decision to close the
Board’s own alternative school. The Board explored the pricing with Kingswood before
the meeting, and made the decisions in sequence at the July board meeting.
Circumstantially, these actions are tied together. But the same undisputed record shows
that the decisions were nonetheless distinct. At the July meeting the Board addressed
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agenda item six, the current alternative school program. After discussion, it voted to
“delete the Alternative School program.” J.A. Vol. I at 351. Then, the Board moved to
agenda item seven, the alternative school proposal. It discussed the proposed
Kingswood contract, heard from and questioned Kingswood representatives, and only
then voted to contract with Kingswood for one year. Id. at 352. While the decisions
were close in time and subject-matter, they were not coterminous. The Board was free,
after the first vote, to make whatever choice it wanted in the second—it possessed
unrestrained discretion to reject the Kingswood plan and seek out another solution. The
Board continued to debate the Kingswood proposal after the first vote abolished the
current school. The second vote came only after the conclusion of that debate. But by
that point, the damage to Plaintiffs was already done. Nothing in their circumstances
changed or could change as a result of the second vote—their previous positions had
been “deleted” by the first.

Considering whether the teachers’ injury is redressable further exacerbates the
standing problem in this case. The majority claims that Plaintiffs’ “injury can be
redressed by an order that the Board compensate the teachers for lost salary and
benefits,” and that relief would, in the abstract, redress the injury of losing a job. Maj.
Op. at 9–10. This case, however, is not abstract. Plaintiffs’ claim for monetary damages
rests on an alleged Establishment Clause violation. As a matter of common sense, when
the claim is that the government is establishing religion, the remedy is an injunction or
a declaratory judgment telling it to stop. See, e.g., Salazar v. Buono, __ U.S. __, 130 S.
Ct. 1803, 1812 (2010) (Kennedy, J., plurality opinion) (seeking an injunction); Valley
Forge Christian Coll. v. Ams. United for Separation of Church & State, Inc., 454 U.S.
464, 469 (1982) (seeking declaratory judgment). Plaintiffs have not cited, and I have not
found, any precedential case where monetary damages were awarded for an
Establishment Clause violation. While Plaintiffs have sought a declaratory judgment in
this case, the majority does not rely on that request for the simple reason that such a
judgment would not redress Plaintiffs’ injuries. A declaratory judgment would stop any
injury to students, but would not reinstate Plaintiffs’ jobs. As previously explained, the
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 39
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Board would still be free, after such a judgment, to outsource the program to another
provider. Plaintiffs’ claim is essentially a contractual one smuggled in under the guise
of an Establishment Clause claim. The disconnect between the available remedies and
Plaintiffs’ injuries not only highlights the causation problem; it bolds, italicizes, and
underlines it.

By articulating the “conduct of which the defendant complains” and comparing
it to Plaintiffs’ injuries, one can clearly see that there is no causal connection between
Plaintiffs’ injuries and the Board’s conduct that allegedly violated the Establishment
Clause. The Board’s decision to abolish their alternative school was entirely within its
authority, and it was that decision that terminated the teachers’ jobs. No one has claimed
that abolishing the alternative school violated the Establishment Clause, and the majority
reaches its conclusion only by erroneously turning two separate actions into one.
Accordingly, I would hold that Plaintiffs do not have individual Article III standing, and
would therefore not reach the prudential standing question.

I also briefly note my disagreement with the majority’s dicta that the teachers
“may have a sufficiently close enough relationship to their students to satisfy the first
prong of the test for third-party standing.” Maj. Op. at 11. Because Plaintiffs cannot
show a hindrance to the students’ and parents’ bringing their own suit, it is unnecessary
for the majority to opine on whether a close relationship existed. Even if it were
necessary, however, the majority’s conclusion is dubious. Plaintiffs are not “forceful
advocates” for their former students’ First Amendment rights in the same way that
parents are advocates for their children. This is all the more true considering the nature
of Tennessee’s alternative schools, which exist for students who have been temporarily
removed from their primary school. See Tenn. Code Ann. § 49-6-3401 (2009). Such
students may be in an alternative school for as little as a few days, hardly enough time
to develop anything like a “close relationship.” Prospective or hypothetical relationships
cannot sustain third-party standing. Kowlaski v. Tesmer, 543 U.S. 125, 130–31 (2004)
(holding that no close relationship existed between attorneys and prospective clients).
Furthermore, as explained above, the teachers’ rights and injuries are in no way
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 40
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“inextricably linked” with the students’ rights and alleged injuries. The teachers’
interest is to be compensated for losing their jobs. That is hardly the same as the
students’ interest in not being compelled to worship. Deciding whether there is a “close
relationship” requires a much more careful and fact-based analysis than that undertaken
– unnecessarily – by the majority here. See id. at 130–31.

I would affirm the district court’s opinion on these issues and would further join
Judge Rogers in concluding that Plaintiffs lack municipal taxpayer standing. I therefore
respectfully dissent from the corresponding portions of the majority opinion.
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 41
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___________________

DISSENT
___________________

ROGERS, Circuit Judge, dissenting. The plaintiffs in this case lack prudential
standing in their capacity as teachers to make their Establishment Clause challenge in
this case, as the majority properly determines. The plaintiffs would be litigating the
rights of third parties—e.g., children who would be subject to government imposition
of religion—who have not sued.

The plaintiffs also lack Article III standing as taxpayers. To hold that some of
the teachers nonetheless have standing as county taxpayers because the county is
misusing county funds, without more, permits the wholesale disregard of third-party
standing limits in the context of this case. The holding also opens up the prospect of
permitting any county taxpayer to challenge any county action no matter whose interests
are involved. Because counties act through their paid officers and employees, any
unconstitutional action could amount to misuse of county funds. The armchair
newspaper reader and county taxpayer who reads that a high school principal replaced
a coach could sue because the replaced coach was of a different race or gender. The
same newspaper reader might be able to sue because an across-town local policeman
used unreasonable force.

No Supreme Court or Sixth Circuit precedent requires us to set such a
questionable precedent, even though standing requirements for municipal taxpayers are
less demanding than those for state or federal taxpayers. See Taub v. Kentucky, 842 F.2d
912, 918 (6th Cir. 1988). Instead, municipal taxpayer standing law requires that the
challenged county action involve an identifiable, negative effect on the county fisc. This
limit is fairly derived from the holdings of Supreme Court and Sixth Circuit cases, and
no other limit has been proposed to avoid the above-suggested sweeping possibilities.

It is true that the Supreme Court stated in Frothingham v. Mellon, 262 U.S. 447,
486 (1923), that a “remedy by injunction to prevent the[] misuse [of municipal funds]
No. 06-6533 Smith et al. v. Jefferson County Bd. of Page 42
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is not inappropriate.” But subsequent decisions of the Supreme Court and this court—in
Establishment Clause cases at that—make clear that the Frothingham language refers
to misuse that results in a loss to the public fisc such that a taxpayer’s identifiable
interest in that fisc is injured. In a case involving Bible-reading in the public schools,
the Supreme Court quoted the Frothingham language but still required at least a
diminution of public funds:

[Frothingham] recognized . . . that “[t]he interest of a taxpayer of a
municipality in the application of its moneys is direct and immediate and
the remedy by injunction to prevent their misuse is not inappropriate.”
Indeed, a number of states provide for it by statute or decisional law and
such causes have been entertained in federal courts. Without disparaging
the availability of the remedy by taxpayer’s action to restrain
unconstitutional acts which result in direct pecuniary injury, we reiterate
what the Court said of a federal statute as equally true when a state Act
is assailed: “The party who invokes the power must be able to show not
only that the statute is invalid but that he has sustained or is immediately
in danger of sustaining some direct injury as a result of its enforcement,
and not merely that he suffers in some indefinite way in common with
people generally.”
It is true that this Court found a justiciable controversy in Everson
v. Board of Education, 330 U.S. 1 [(1947), a suit by a district taxpayer
against a township board of education]. But Everson showed a
measurable appropriation or disbursement of school-district funds
occasioned solely by the activities complained of. This complaint does
not. . . .
[B]ecause our own jurisdiction is cast in terms of “case or
controversy,” we cannot accept as the basis for review, nor as the basis
for conclusive disposition of an issue of federal law without review, any
procedure which does not constitute such.
The taxpayer’s action can meet this test, but only when it is a
good-faith pocketbook action. It is apparent that the grievance which it
is sought to litigate here is not a direct dollars-and-cents injury but is a
religious difference. If appellants established the requisite special injury
necessary to a taxpayer’s case or controversy, it would not matter that
their dominant inducement to action was more religious than mercenary.
It is not a question of motivation but of possession of the requisite
financial interest that is, or is threatened to be, injured by the
unconstitutional conduct. We find no such direct and particular financial
interest here. If the Act may give rise to a legal case or controversy on
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some behalf, the appellants cannot obtain a decision from this Court by
a feigned issue of taxation.

Doremus v. Bd. of Educ., 342 U.S. 429, 433-35 (1952) (citations omitted).

Doremus cannot simply be dismissed as a state-taxpayer case. To be sure, the
challenged statute in Doremus was a state statute, but that just states the nature of the
constitutional claim against the local school board: enforcement of an unconstitutional
state statute. The defendant was a New Jersey borough school board, and one of the two
plaintiffs discussed by the Supreme Court is only described as having alleged that he was
a taxpayer of the defendant borough. Id. at 433. The Court described the record in clear
terms:

There is no allegation that this [Bible-reading] activity is supported by
any separate tax or paid for from any particular appropriation or that it
adds any sum whatever to the cost of conducting the school. No
information is given as to what kind of taxes are paid by appellants and
there is no averment that the Bible reading increases any tax they do pay
or that as taxpayers they are, will, or possibly can be out of pocket
because of it.

342 U.S. at 433. For standing purposes, the instant case is indistinguishable.1
Furthermore, the above-quoted language refers on its face to municipal taxpayers, and
distinguishes Everson, a case that explicitly involved “district taxpayers.” 330 U.S. at 3.
Moreover, as the majority recognizes, as many as six of our sister circuits read the

1
I recognize that the Supreme Court relied in part on Doremus in deciding that state taxpayer suits
are subject to the same standing requirements as federal taxpayer suits. DaimlerChrysler v. Cuno, 547
U.S. 332, 345 (2006). The Court’s two brief references to Doremus accurately reflected (1) that the
Doremus Court stated the policy underpinnings for federal taxpayer standing limits, and (2) the fact that
the suit in Doremus challenged a state statute. Because DaimlerChrysler involved a challenge to a state
statute, it made sense for the Court to find Doremus to be parallel in that respect. But DaimlerChrysler
can hardly erase the fact that Doremus involved a borough taxpayer challenging actions of a borough
school board, and that the Supreme Court in Doremus explicitly referred to municipal taxpayer standing.
Moreover, it would make little sense to read DaimlerChrysler, a case that limited state taxpayer
standing, to have implicitly undone previously applicable limits on municipal taxpayer standing. Indeed,
the Court in DaimlerChrysler rejected an argument by the plaintiff in that case, who was making a
Commerce Clause challenge to a state tax credit for DaimlerChrysler, that “the award of a credit to
DaimlerChrysler reduced [state distributions to local governments] and thus depleted the funds of ‘local
governments to which Respondents pay taxes.’” The Court rejected the argument by saying that such
depletion was conjectural, and made no suggestion that such depletion was not required.
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Doremus holding as applicable to municipal taxpayer suits. See ACLU-NJ v. Twp. of
Wall, 246 F.3d 258, 262 (3d Cir. 2001); Koenick v. Felton, 190 F.3d 259, 263 (4th Cir.
1999); Clay v. Fort Wayne Cmty. Sch., 76 F.3d 873, 879 (7th Cir. 1996); Thompson v.
Cnty. of Franklin, 15 F.3d 245, 253 (2d Cir. 1994); Cammack v. Waihee, 932 F.2d 765,
770 (9th Cir. 1991); D.C. Common Cause v. District of Columbia, 858 F.2d 1, 4 (D.C.
Cir. 1988).

This court ruled similarly in a case that also clearly applies to municipal taxpayer
standing. Hawley v. City of Cleveland, 773 F.2d 736, 737-38 (6th Cir. 1985), was an
action challenging a lease of airport space for use as a chapel. We held that users of the
airport had standing because they would have to use different concourses or stairways
to avoid “unwelcome religious exercises.” Id. at 740 (citation omitted). But the
standing of Cleveland taxpayers depended on “whether the rental of the space for the
chapel to the diocese at the agreed-upon price could harm Cleveland’s fisc,” and we
remanded for a determination of that issue. Id. at 742. In doing so, we cited the very
language of Frothingham referred to above regarding “misuse,” summarized more recent
cases including Doremus, and concluded that “the Supreme Court continues to allow
suits by nonfederal taxpayers to enjoin unconstitutional acts affecting public finances.”
Id. (emphasis added); see also Steele v. Indus. Dev. Bd., No. 93-5350, 1994 WL 599458,
at *1 (6th Cir. Nov. 1, 1994) (issuance of tax-exempt bonds to a sectarian university).
Here, in contrast to the situation in Hawley where the facts were not clear, it is
undisputed that the elimination of the alternative school and the delegation to
Kingswood did not adversely affect the public fisc. Hawley cannot be distinguished as
involving a failure to collect—rather than an expenditure of—tax revenue. Compare
Maj. Op. at pp. 20-21. Such a distinction is facially inconsistent with the taxpayer-
standing analysis in that case, which turned on whether there was a “loss of revenue” or
“harm to the public purse,” and not on some artificial distinction between spending and
not collecting revenue. Because the Board in this case had an obligation under state law
to provide an alternative program, the delegation was not an additional expenditure, but
instead reduced the financial burden on Jefferson County and its taxpayers. There is no
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need to defend the public treasury because Jefferson County, and thus its taxpayers, have
saved money as a result of the delegation.

In such a situation, a taxpayer asserts nothing more than a claim that the
municipality must follow the law. The Supreme Court, however, has repeatedly held
that “Art. III requirements of standing are not satisfied by ‘the abstract injury in
nonobservance of the Constitution asserted by . . . citizens.’” Valley Forge Christian
Coll. v. Ams. United for Separation of Church and State, Inc., 454 U.S. 464, 482 (1982)
(quoting Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208, 223 n.13
(1974)).

Finally, requiring municipal taxpayers to establish at least some diminution of
the public fisc is fully consistent with the distinction between municipal taxpayers and
state and federal taxpayers. For federal and state taxpayers to have standing, they must
show more than just government action that depletes the treasury and thus creates the
possibility of future taxation. See DaimlerChrysler, 547 U.S. at 345-46. This is because
the interests of federal and state taxpayers in their respective federal and state treasuries
“[are] shared with millions of others; [are] comparatively minute and indeterminable;
and the effect upon future taxation . . . so remote, fluctuating and uncertain, that no basis
is afforded for an appeal to the preventative powers of a court of equity.” Id. at 333
(quoting Frothingham, 262 U.S. at 486-87); see also id. at 345. Municipal taxpayers,
on the other hand, have been held to possess a much more direct interest in the municipal
treasury. Because municipal taxpayers are theoretically fewer in number, they have a
more direct relationship with their local government such that a direct injury is presumed
when the municipal fisc is depleted. Taub, 842 F.2d at 918.

A number of the cases cited by the majority as rejecting the requirement that the
municipal fisc be depleted instead merely hold that a plaintiff need not show that the
plaintiff’s taxes must be affected. See Koenick, 190 F.3d at 263; United States v. City
of New York, 972 F.2d 464, 466 (2d Cir. 1992); Cammack, 932 F.2d at 770; Common
Cause, 858 F.2d at 5; Donnelly v. Lynch, 691 F.2d 1029, 1031 (1st Cir. 1982). These
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cases are nonetheless consistent with a lesser, constitutionally minimum requirement in
taxpayer cases that the municipality’s funds be reduced. Without such a requirement,
it is “Katie bar the door”—a county taxpayer could challenge virtually any county action
without demonstrating a personal stake in the outcome of the suit.

Indeed, the District of Columbia Circuit reasoned that even though municipal
taxpayers need not “demonstrate that their taxes will be reduced as a result of a favorable
judgment,” they must still show that “the challenged program involves a measurable
appropriation of public funds.” Common Cause, 858 F.2d at 5. The D.C. Circuit cited
our decision in Hawley, among other authorities. Id. In short, without at least a
demonstration of a reduction of the public fisc from the challenged action, municipal
taxpayers lack Article III standing.

The federal courts have jurisdiction only when plaintiffs will get something by
winning beyond the satisfaction that the government is complying with the law, and
(absent congressional grants of standing) only when the plaintiffs rely upon legal
principles that protect their interests. These fundamental principles keep the courts from
constituting themselves as supervising review boards to decide in the abstract the
constitutionality of all government actions. Under these principles, plaintiffs lack
standing either as employees or as municipal taxpayers. The district court therefore does
not have jurisdiction to address the substantive Establishment Clause issues in this case.

I agree with the majority’s conclusion that the plaintiffs lack individual standing
as teachers.2 I join Parts II.C (procedural due process), II.D (substantive due process),
and II.E (legislative immunity) of the majority opinion. I disagree with the majority’s
determination that plaintiffs have standing as taxpayers, and therefore respectfully
dissent.

2
In stating three requirements for prudential standing, the majority appears to identify being
within the “zone of interests” as an independent, generally applicable requirement for prudential standing.
Maj. Op. 9. The majority’s analysis does not reach the “zone of interests” test, however, and the brief
discussion of the role of the “zone of interests” test is therefore not necessary to the court’s holding. For
a critique of such an expansive view of the role of the “zone of interests” test, see Smith v. Jefferson Cnty.
Bd. of Sch. Comm'rs, 549 F.3d 641, 663 (6th Cir. 2008) (Rogers, J., dissenting).