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Saturday, May 31, 2008

Ind. Courts - "Key Hoosier Lottery case up for oral argument" before the 7th Circuit

The ILB has had a number of entries on various aspects of Indiana's quasi-public agencies. For instance, this Sept. 1, 2004 entry headed "Another indictment of an Indiana quasi-public entity" referenced the Intelenet Commission, PERF, the Indiana Economic Development Commission (IEDC), and the BMV Commission.

Other quasi-publics mentioned in ILB entries include include the state Lottery Commission, the State Office Building Commission and the Toll Road Commission.

This ILB entry from August 30, 2004, quoting from a story by Michele McNeil Solida, then of the Indianapolis Star, details the woes that can befall a quasi-public state agency:

Scales' conduct at the academy highlights significant problems with checks and balances at Indiana's Intelenet Commission, which oversaw Scales and the work going on at the academy.

The Intelenet Commission was created by the General Assembly in 1986 to start and operate a statewide telecommunications network for public agencies and libraries. It doesn't fall under many of the controls of state government because it's a quasi-public agency. It has its own personnel rules. It handles its own bills and check-writing instead of using the state auditor's office.

Nobody in the governor's office directly controls Intelenet, although the governor hires the executive director and appoints five of the 16 members of the commission's board. The commission, like the state's other quasi-public agencies, operates free from many government rules, so it can get things done much faster. And the commission, which managed $49 million last year, didn't have many of its own controls in place.

There was no policy for criminal background checks, no policy to regulate what expenses employees could get reimbursed and little training in government ethics. The policy on tuition reimbursement wasn't enforced.

Can an Indiana quisi-public agency maintain its exemption from state law requirements while at the same time asserting that it is immune from federal rules because it is a state agency? Ed Feigenbaum looks at that question in the June 2nd issue of Indiana Gaming Insight ($$$ only), under the heading "Key Hoosier Lottery case up for oral argument":
Oral argument is slated before a panel of the U.S. Court of Appeals for the Seventh Circuit on Friday, June 6 in Burrus v. State Lottery Comm’n of Indiana, No. 08-1142.

This is the case we have been telling you about which involved eight African-American former Hoosier Lottery employees sueing the Lottery under §1981 and Title VII for race discrimination, claiming that they were all terminated between January and August 2005 because of their race, which the Lottery denies. Six of the workers who filed the lawsuit had been employed by the Lottery since its creation in 1989. The Lottery contended that it was immune from the claims in federal court because it is a state agency. Judge Sarah Evans Barker of the U.S. District Court for the Southern District of Indiana denied the Lottery’s jurisdictional motion, finding the Lottery was not a state agency entitled to 11th Amendment sovereign immunity. [Here is Judge Barker's opinion.]

This case is important not only on a macro basis because of its implications for the immunity of similar quasi-state entities, but also on a micro basis for the Lottery. Soon after the Jan. 7th Burrus ruling, in Shisler v. State Lottery Comm’n of Indiana, No. 1:07-cv-01190 (4/25/08), Judge Larry J. McKinney, also of the U.S. District Court for the Southern District of Indiana, denied the Hoosier Lottery’s Motion to Dismiss for Lack of Jurisdiction in the high-profile job discrimination claim filed against the Lottery by its former general counsel, Janna Shisler. As we told you, Judge McKinney relied heavily on Judge Barker’s analysis in the Burrus ruling to agree with her finding that the Lottery was an independent agency and, thus, not entitled to sovereign immunity. As he put it in the Shisler opinion, which drew liberally from Burrus, “The Court cannot disagree with Judge Barker’s analysis.”

Posted by Marcia Oddi on May 31, 2008 01:24 PM
Posted to Ind Fed D.Ct. Decisions | Ind. (7th Cir.) Decisions | Indiana Government