Come Down and Make Bargains in Good Faith: The Application of 42 U.S.C. §1981 to Race and National Origin Discrimination in Retail Stores

Abstract:     
This article examines and critiques courts’ narrow interpretations of 42 U.S.C. § 1981 in race and national origin discrimination cases brought by retail shoppers and offers a model for improved § 1981 decision-making.

Section 1981, a Reconstruction-era civil rights statute, guarantees to all people within the United States the same right “as is enjoyed by white citizens” to “make and enforce contracts.” Courts have narrowly interpreted the statute in two ways. First, some courts have allowed shoppers to state a claim only if they are clearly blocked from “making” a contract on a discriminatory basis. Shoppers who successfully contract with retail stores, but on discriminatory terms and conditions, and browsers who are deterred, but not completely blocked from purchasing, can claim no § 1981 protection. Second, though some courts do recognize that the statute also covers a contract's "privileges, benefits, terms, and conditions," they only accept as actionable claims that arise directly from the moment of purchase. Retailers’ discriminatory acts against shoppers before or after the exchange of money for goods fall outside the statute's coverage, and those shoppers are left without a remedy. Both forms of narrowing leave much of the retail shopping interaction, including pre- and post-contract formation, uncovered by the statute. This paper provides a taxonomy of courts' § 1981 jurisprudence and explores directions for an improved application of the statute to claims of race and national origin discrimination in retail stores.

Number of Pages in PDF File: 54

Keywords: Section 1981, civil rights, contracts, discrimination, good faith, retail, retailers, race discrimination, racial discrimination, national origin, national origin discrimination, retail stores

JEL Classification: K12, K49, K30

Accepted Paper Series