Justice Scalia, delivered the opinion of the Court.
In this case we consider whether actions of the National Railroad Passenger Corporation, commonly known as Amtrak, are subject to the constraints of the Constitution.
Petitioner, Michael A. Lebron, creates billboard displays that involve commentary on public issues, and that seemingly propel him into litigation. See, e. g., Lebron v. Washington Metropolitan Area Transit Authority, 749 F.2d 893 (CADC 1984). In August 1991, he contacted Transportation Displays, Incorporated (TDI), which manages the leasing of the billboards in Amtrak's Pennsylvania Station in New York City, seeking to display an advertisement on a billboard of colossal proportions, known to New Yorkers (or at least to the more Damon Runyonesque among them) as "the Spectacular." The Spectacular is a curved, illuminated billboard, approximately 103 feet long and 10 feet high, which dominates the main entrance to Penn Station's waiting room and ticket area.
On November 30, 1992, Lebron signed a contract with TDI to display an advertisement on the Spectacular for two months beginning in January 1993. The contract provided that "[a]ll advertising copy is subject to approval of TDI and [Amtrak] as to character, text, illustration, design and operation." App. 671. Lebron declined to disclose the specific content of his advertisement throughout his negotiations
Amtrak's vice president disapproved the advertisement, invoking Amtrak's policy, inherited from its predecessor as landlord of Penn Station, the Pennsylvania Railroad Company, "that it will not allow political advertising on the [S]pectacular advertising sign." App. 285.
Lebron then filed suit against Amtrak and TDI, claiming, inter alia, that the refusal to place his advertisement on the Spectacular had violated his First and Fifth Amendment rights. After expedited discovery, the District Court ruled that Amtrak, because of its close ties to the Federal Government, was a Government actor, at least for First Amendment purposes, and that its rejection of Lebron's proposed advertisement as unsuitable for display in Penn Station had violated the First Amendment. The court granted Lebron an
The United States Court of Appeals for the Second Circuit reversed. 12 F.3d 388 (1993). The panel's opinion first noted that Amtrak was, by the terms of the legislation that created it, not a Government entity, id., at 390; and then concluded that the Federal Government was not so involved with Amtrak that the latter's decisions could be considered federal action, id., at 391-392. Chief Judge Newman dissented. We granted certiorari. 511 U.S. 1105 (1994).
We have held once, Burton v. Wilmington Parking Authority, 365 U.S. 715 (1961), and said many times, that actions of private entities can sometimes be regarded as governmental action for constitutional purposes. See, e. g., San Francisco Arts & Athletics, Inc. v. United States Olympic Comm., 483 U.S. 522, 546 (1987); Blum v. Yaretsky, 457 U.S. 991, 1004 (1982); Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 172 (1972). It is fair to say that "our cases deciding when private action might be deemed that of the state have not been a model of consistency." Edmonson v. Leesville Concrete Co., 500 U.S. 614, 632 (1991) (O'Connor, J., dissenting). It may be unnecessary to traverse that difficult terrain in the present case, since Lebron's first argument is that Amtrak is not a private entity but Government itself. Before turning to the merits of this argument, however, it is necessary to discuss the propriety of reaching it. Lebron did not raise this point below; indeed, he expressly disavowed it in both the District Court and the Court of Appeals. See Plaintiff's Pre-Trial Proposed Conclusions of Law in No. 92—CIV-9411 (SDNY), p. 12, n. 1, reprinted in App. in No. 93-7127 (CA2), p. 1297; Brief for Appellee in No. 93-7127 (CA2), p. 30, n. 39. In those courts Lebron argued that Amtrak's actions were subject to constitutional requirements because Amtrak, al-
Our traditional rule is that "[o]nce a federal claim is properly presented, a party can make any argument in support of that claim; parties are not limited to the precise arguments they made below." Yee v. Escondido, 503 U.S. 519, 534 (1992); see also Dewey v. Des Moines, 173 U.S. 193, 198 (1899). Lebron's contention that Amtrak is part of the Government is in our view not a new claim within the meaning of that rule, but a new argument to support what has been his consistent claim: that Amtrak did not accord him the rights it was obliged to provide by the First Amendment. Cf. Yee, supra, at 534-535. In fact, even if this were a claim not raised by petitioner below, we would ordinarily feel free to address it, since it was addressed by the court below. Our practice "permit[s] review of an issue not pressed so long as it has been passed upon . . . ." United States v. Williams, 504 U.S. 36, 41 (1992). See Virginia Bankshares, Inc. v. Sandberg, 501 U.S. 1083, 1099, n. 8 (1991); Stevens v. Department of Treasury, 500 U.S. 1, 8 (1991).
Respondent asserts that, in addition to not having been raised below, the issue of whether Amtrak is a Government entity was not presented in the petition for certiorari. As this Court's Rule 14.1(a) and simple prudence dictate, we will not reach questions not fairly included in the petition. "The Court decides which questions to consider through wellestablished procedures; allowing the able counsel who argue before us to alter these questions or to devise additional questions at the last minute would thwart this system." Taylor v. Freeland & Kronz, 503 U.S. 638, 646 (1992). Here, however, we are satisfied that the argument that Amtrak is a Government entity is fairly embraced within the question
The dissent contends that the "Government entity" question in the present case occupies the same status, insofar as Rule 14.1(a) is concerned, as the "physical taking" question which we deemed excluded in Yee v. Escondido, supra. It gives two reasons for that equivalence: First, the fact that Lebron prefaced his question presented by the phrase, "Whether the court of appeals erred in holding." App. to Pet. for Cert. i. The dissent asserts that this is similar to the preface in Yee, which had the effect of limiting the question to the precise ground relied upon by the Court of Appeal. Post, at 402. But the preface in Yee was not at all similar. What we said caused the question presented to be limited to the physical-taking issue was not the fact that that was the only ground addressed by the lower-court-said-tobe-in-error; but rather the fact that that was the only ground of decision in two previous Court of Appeals cases, departure
The dissent's second reason for believing that Yee governs the Rule 14.1(a) issue here is that the structural relationship between the clearly presented question and the assertedly included question in the two cases is the same. As the dissent correctly analyzes Yee, it involved one "umbrella claim" (government taking of property without just compensation) and "two distinct questions" that were "[s]ubsidiary to that claim" (whether a physical taking had occurred, and whether a regulatory taking had occurred). Post, at 401. But the questions in Yee were "distinct" in two important ways that the claims here are not. First of all, it was possible to consider the existence of a physical taking without assuming (as one of the premises of the inquiry) the nonexistence of a regulatory taking; whereas here it is quite impossible to consider whether the Government connections are sufficient to convert private-entity Amtrak into a Government actor without first assuming that Amtrak is a private entity. The opinion in Yee did not have to begin: "Assuming that no regulatory taking has occurred, . . . ." But the portion of today's dissent addressing the merits of this case must begin: "Accepting Lebron's concession that Amtrak is a private entity, . . . ." Post, at 408. The question of private-entity status is, in other words, a prior question. The second respect in which the issues here are less "distinct" than in Yee is that the factors relevant to their resolution overlap. In Yee, what would go to show a regulatory taking and
The recent decision of ours that invites comparison with the dissent's insistence that the "Government entity" question is "precluded," post, at 400, is not Yee, but United States Nat. Bank of Ore. v. Independent Ins. Agents of America, Inc., 508 U.S. 439 (1993). There, in a case raising the question of the proper interpretation of 12 U. S. C. § 92 (1926 ed.), we upheld the propriety of the Court of Appeals' considering the prior question whether 12 U. S. C. § 92 had been inadvertently repealed—even though the parties themselves had failed to raise that question, not only (as here) in the court below, but even in the initial briefs and oral arguments before the Court of Appeals itself. That is to say, the situation there, at the court of appeals level, was what the situation would be before us here, if (1) the dissent were correct that Rule 14.1(a) was not complied with, and (2) in addition, even the petitioner's principal brief and oral argument had failed to raise the "Government entity" issue. Even so, we held in Independent Insurance Agents that it was proper for the Court of Appeals to request supplemental briefing upon, and to decide, the statutory repeal question, and we then went on to inquire into that question ourselves. Our opinion was unanimous, not a single Justice protesting that the judges of the Court of Appeals, or of this Court, had constituted
Before proceeding to consider Lebron's contention that Amtrak, though nominally a private corporation, must be regarded as a Government entity for First Amendment purposes, we examine the nature and history of Amtrak and of Government-created corporations in general.
Congress established Amtrak in order to avert the threatened extinction of passenger trains in the United States.
. . . . .
. . . . .
Later sections of the statute authorize Amtrak's incorporation, §§ 541-542, set forth its structure and powers, §§ 543— 545, and outline procedures under which Amtrak will relieve private railroads of their passenger-service obligations and provide intercity and commuter rail passenger service itself, §§ 561-566. See generally National Railroad Passenger Corporation v. Atchison, T. & S. F. R. Co., 470 U.S. 451, 453-456 (1985). As initially conceived, Amtrak was to be
Amtrak is incorporated under the District of Columbia Business Corporation Act, D. C. Code Ann. § 29-301 et seq. (1981 and Supp. 1994), but is subject to the provisions of that Act only insofar as the RPSA does not provide to the contrary, see § 541. It does provide to the contrary with respect to many matters of structure and power, including the manner of selecting the company's board of directors. The RPSA provides for a board of nine members, six of whom are appointed directly by the President of the United States. The Secretary of Transportation, or his designee, sits ex officio. § 543(a)(1)(A). The President appoints three more directors with the advice and consent of the Senate, § 543(a)(1)(C), selecting one from a list of individuals recommended by the Railway Labor Executives Association, § 543(a)(1)(C)(i), one "from among the Governors of States with an interest in rail transportation," § 543(a)(1)(C)(ii), and one as a "representative of business with an interest in rail transportation," § 543(a)(1)(C)(iii). These directors serve 4-year terms. § 543(a)(2)(A). The President appoints two additional directors without the involvement of the Senate, choosing them from a list of names submitted by various commuter rail authorities. § 543(a)(1)(D). These directors serve 2-year terms. § 543(a)(2)(B). The holders of Amtrak's preferred stock select two more directors, who serve 1-year terms. § 543(a)(1)(E). Since the United States presently holds all of Amtrak's preferred stock, which it received (and still receives) in exchange for its subsidization of Amtrak's perennial losses, see § 544(c), the Secretary of Transportation selects these two directors. The ninth member of the board is Amtrak's president, § 543(a)(1)(B), who serves as the chairman of the board, § 543(a)(4), is selected by the other eight directors, and serves at their pleasure, § 543(d).
By § 548 of the RPSA, Amtrak is required to submit three different annual reports to the President and Congress. One of these, a "report on the effectiveness of this chapter in meeting the requirements for a balanced national transportation system, together with any legislative recommendations," is made part of the Department of Transportation's annual report to Congress. § 548(c).
Amtrak is not a unique, or indeed even a particularly unusual, phenomenon. In considering the question before us, it is useful to place Amtrak within its proper context in the long history of corporations created and participated in by the United States for the achievement of governmental objectives.
The first was the Bank of the United States, created by the Act of Feb. 25, 1791, ch. 10, 1 Stat. 191, which authorized the United States to subscribe 20 percent of the corporation's stock, id., at 196. That Bank expired pursuant to the terms of its authorizing Act 20 years later. A second Bank of the United States, the bank of McCulloch v. Maryland, 4 Wheat. 316 (1819), and Osborn v. Bank of United States, 9 Wheat. 738 (1824), was incorporated by the Act of April 10, 1816, 3
The second Bank's charter expired of its own force, despite fierce efforts by the Bank's supporters to renew it, in 1836. See generally R. Remini, Andrew Jackson and the Bank War 155-175 (1967). During the remainder of the 19th century, the Federal Government continued to charter private corporations, see, e. g., Act of July 2, 1864, 13 Stat. 365 (Northern Pacific Railroad Company), but only once participated in such a venture itself: the Union Pacific Railroad, chartered in 1862 with the specification that two of its directors would be appointed by the President of the United States. Act of July 1, 1862, § 1, 12 Stat. 491. See F. Leazes, Jr., Accountability and the Business State 117, n. 8 (1987) (hereinafter Leazes).
The Federal Government's first participation in a corporate enterprise in which (as with Amtrak) it appointed a majority of the directors did not occur until the present century. In 1902, to facilitate construction of the Panama Canal, Congress authorized the President to purchase the assets of the New Panama Canal Company of France, including that company's stock holdings in the Panama Railroad Company, a private corporation chartered in 1849 by the State of New York. See Act of June 28, 1902, 32 Stat. 481; see also General Accounting Office, Reference Manual of Government Corporations, S. Doc. No. 86, 79th Cong., 1st Sess., 176 (1945) (hereinafter GAO Corporation Manual). The United States became the sole shareholder of the Panama Railroad, and continued to operate it under its original charter, with the Secretary of War, as the holder of the stock, electing the Railroad's 13 directors. Id., at 177; Joint Committee on Reduction of Nonessential Federal Expenditures, Reduction of Nonessential Federal Expenditures, S. Doc. No. 227,
The first large-scale use of Government-controlled corporations came with the First World War. In 1917 and 1918, Congress created, among others, the United States Grain Corporation, the United States Emergency Fleet Corporation, the United States Spruce Production Corporation, and the War Finance Corporation. See Leazes 20. These entities were dissolved after the war ended. See Reduction of Expenditures 1.
The Great Depression brought the next major group of Government corporations, which proved to be more enduring. These were primarily directed to stabilizing the economy and to making distress loans to farms, homeowners, banks, and other enterprises. See R. Moe, CRS Report for Congress, Administering Public Functions at the Margins of Government: The Case of Federal Corporations 6-7 (1983). The Reconstruction Finance Corporation (RFC), to take the premier example, was initially authorized to make loans to banks, insurance companies, railroads, land banks, and agricultural credit organizations, including loans secured by the assets of failed banks. See Act of Jan. 22, 1932, § 5, 47 Stat. 6-7. The Federal Deposit Insurance Corporation (FDIC), was established to hold and liquidate the assets of failed banks, and to insure bank deposits. See Act of June 16, 1933, ch. 89, § 8,48 Stat. 168, as amended, 12 U. S. C. § 1811 et seq. (1988 ed. and Supp. V). And a few corporations, such as the Tennessee Valley Authority (TVA), brought the Government into the commercial sale of goods and services. See Act of May 18, 1933, ch. 32, 48 Stat. 58, as amended, 16 U. S. C. § 831 et seq. (1988 ed. and Supp. V).
The growth of federal corporations during the Depression and the World War II era was not limited to the numerous entities specifically approved by Congress. In 1940, Congress empowered the RFC to create corporations without specific congressional authorization. See Act of June 25,
By the end of World War II, Government-created and -controlled corporations had gotten out of hand, in both their number and their lack of accountability. Congress moved to reestablish order in the Government Corporation Control Act (GCCA), 59 Stat. 597, as amended, 31 U. S. C. § 9101 et seq. (1988 ed. and Supp. V). See Pritchett, The Government Corporation Control Act of 1945, 40 Am. Pol. Sci. Rev. 495 (1946). The GCCA required that specified corporations, both wholly owned and partially owned by the Government, be audited by the Comptroller General. See 59 Stat. 599, 600. Additionally, the wholly owned corporations were required, for the first time, to submit budgets which would be included in the budget submitted annually to Congress by
Thus, in the years immediately following World War II, many Government corporations were dissolved, and to our knowledge only one, the Saint Lawrence Seaway Development Corporation, was created. See Leazes 25, 27. In the 1960's, however, the allure of the corporate form was felt again, and new entities proliferated. Many of them followed the traditional model, often explicitly designated as Government agencies and located within the existing Government structure. See, e. g., Foreign Assistance Act of 1969, § 105, 83 Stat. 809 (creating the Overseas Private Investment Corporation as "an agency of the United States under the policy guidance of the Secretary of State"), as amended, 22 U. S. C. § 2191 et seq. (1988 ed. and Supp. V). Beginning in 1962, however, the Government turned to sponsoring corporations that it specifically designated not to be agencies or establishments of the United States Government, and declined to subject to the control mechanisms of the GCCA. The first of these, the Communications Satellite Corporation (Comsat), was incorporated under the District of Columbia Business Corporation Act, D. C. Code Ann. § 29-301 et seq. (1981 and Supp. 1994), see 47 U. S. C. § 731 et seq., with the purpose of entering the private sector, but doing so with Governmentconferred advantages, see Moe, supra, at 22. Comsat was capitalized entirely with private funds. See Seidman, Government-sponsored Enterprise in the United States, in The New Political Economy: The Public Use of the Private Sector 92 (B. Smith ed. 1975). In contrast to the corporations that had in the past been deemed part of the Government, Comsat's board was to be controlled by its private
The Comsat model, which was seen as allowing the Government to act unhindered by the restraints of bureaucracy and politics, see Moe, CRS Report, at 22, 24, was soon followed in creating other corporations. But some of these new "private" corporations, though said by their charters not to be agencies or instrumentalities of the Government, see, e. g., 47 U. S. C. § 396(b) (Corporation for Public Broadcasting (CPB)); 42 U. S. C. § 2996d(e)(1) (Legal Services Corporation (LSC)), and though not subjected to the restrictions of the GCCA, were (unlike Comsat) managed by boards of directors on which Government appointees had not just a few votes but voting control. See Public Broadcasting Act of 1967, § 201, 81 Stat. 369 (CPB's entire board appointed by President); Legal Services Corporation Act of 1974, § 2, 88 Stat. 379 (same for LSC).
Amtrak is yet another variation upon the Comsat theme. Like Comsat, CPB, and LSC, its authorizing statute declares that it "will not be an agency or establishment of the United States Government." 84 Stat. 1330; see 45 U. S. C. § 541. Unlike Comsat, but like CPB and LSC, its board of directors is controlled by Government appointees. And unlike all three of those "private" corporations, it has been added to the list of corporations covered by the GCCA, see 31 U. S. C. § 9101 (1988 ed. and Supp. V). As one perceptive observer has concluded with regard to the post-Comsat Governmentsponsored "private" enterprises:
Amtrak claims that, whatever its relationship with the Federal Government, its charter's disclaimer of agency status prevents it from being considered a Government entity in the present case. This reliance on the statute is misplaced. Section 541 is assuredly dispositive of Amtrak's status as a Government entity for purposes of matters that are within Congress's control—for example, whether it is subject to statutes that impose obligations or confer powers upon Government entities, such as the Administrative Procedure Act, 5 U. S. C. § 551 et seq. (1988 ed. and Supp. V), the Federal Advisory Committee Act, 5 U. S. C. App. § 1 et seq., and the laws governing Government procurement, see 41 U. S. C. § 5 et seq. (1988 ed. and Supp. V). And even beyond that, we think § 541 can suffice to deprive Amtrak of all those inherent powers and immunities of Government agencies that it is within the power of Congress to eliminate. We have no doubt, for example, that the statutory disavowal of Amtrak's agency status deprives Amtrak of sovereign immunity from suit, see Sentner v. Amtrak, 540 F.Supp. 557, 560 (NJ 1982), and of the ordinarily presumed power of Government agencies authorized to incur obligations to pledge the credit of the United States, see, e. g., Debt Obligations of Nat. Credit Union Admin., 6 Op. Off. Legal Counsel 262, 264 (1982). But it is not for Congress to make the final determination of Amtrak's status as a Government entity for purposes of determining the constitutional rights of citizens affected by its actions. If Amtrak is, by its very nature, what the Constitution regards as the Government, congressional pronouncement that it is not such can no more relieve it of its First Amendment restrictions than a similar pronouncement could exempt the Federal Bureau of Investigation from the Fourth Amendment. The Constitution constrains governmental action "by whatever instruments or in whatever modes that action may be taken." Ex parte Virginia, 100 U.S. 339, 346-347 (1880). And under whatever congressional
Amtrak points to two of our opinions that characterize Amtrak as a nongovernmental entity. The first is National Railroad Passenger Corporation v. Boston & Maine Corp., 503 U.S. 407, 410 (1992), which describes the corporation as "not an agency or instrumentality of the United States Government." But the governmental or nongovernmental nature of Amtrak had no conceivable relevance to the issues before the Court in Boston & Maine. The quoted characterization, similar to that contained in the statute, was merely set forth at the beginning of the opinion, in describing the factual background of the case. It is hard to imagine weaker dictum.
The second case is National Railroad Passenger Corporation v. Atchison, T. & S. F. R. Co., 470 U.S. 451 (1985). There the governmental character of Amtrak was marginally relevant. The railroads opposing Amtrak in the case argued that a subsequent statute reneging on the Government's own obligations was subject to a "more rigorous standard of review" under the Due Process Clause than a statute impairing private contractual obligations. Id., at 471. The Court said it did not have to consider that question because the contracts in question were "not between the railroads and the United States but simply between the railroads and the nongovernmental corporation, Amtrak." Id., at 470. But it develops, later in the opinion, that the Court would not have had to consider that question anyway, since it concluded that the contracts (whether those of the United States or not) did not incur the obligation alleged. The effect of the apparent reliance upon Amtrak's nongovernmental
The question before us today is unanswered, therefore, by governing statutory text or by binding precedent of this Court. Facing the question of Amtrak's status for the first time, we conclude that it is an agency or instrumentality of the United States for the purpose of individual rights guaranteed against the Government by the Constitution.
This conclusion seems to us in accord with public and judicial understanding of the nature of Government-created and -controlled corporations over the years. A remarkable feature of the heyday of those corporations, in the 1930's and 1940's, was that, even while they were praised for their status "as agencies separate and distinct, administratively and financially and legally, from the government itself, [which] has facilitated their adoption of commercial methods of accounting and financing, avoidance of political controls, and
This Court has shared that view. For example, in Reconstruction Finance Corporation v. J. G. Menihan Corp., 312 U.S. 81 (1941), Chief Justice Hughes, writing for the Court, described the RFC, whose organic statute did not state it to be a Government instrumentality, as, nonetheless, "a corporate agency of the government," and said that "it acts as a governmental agency in performing its functions." Id., at 83. In Cherry Cotton Mills, Inc. v. United States, 327 U.S. 536 (1946), we had little difficulty finding that the RFC was "an agency selected by Government to accomplish purely governmental purposes," id., at 539, and was thus entitled to the benefit of a statute giving the Court of Claims jurisdiction over "counterclaims . . . on the part of the Government of the United States," 28 U. S. C. § 250(2) (1940 ed.). Likewise in Inland Waterways Corp. v. Young, 309 U.S. 517 (1940), we found that the Inland Waterways Corporation, which similarly was not specifically designated in its charter as an instrumentality of the United States, see Act of June 3, 1924, 43 Stat. 360, was an agency of the United States, so that its funds were "public moneys" for which national banks
Even Congress itself appeared to acknowledge, at least until recent years, that Government-created and -controlled corporations were part of the Government. The GCCA, discussed above, which brought to an end the era of uncontrolled growth of Government corporations, provided that, without explicit congressional authorization, no corporation should be acquired or created by "any officer or agency of the Federal Government or by any Government corporation for the purpose of acting as an agency or instrumentality of the United States . . . ." § 304(a), 59 Stat. 602 (emphasis added). That was evidently intended to restrict the creation of all Government-controlled policy-implementing corporations, and not just some of them. And the companion provision that swept away many of the extant corporations said that no wholly owned government corporation created under state law could continue "as an agency or instrumentality of the United States," § 304(b), 59 Stat. 602. Once again, that was evidently meant to eliminate policyimplementing government ownership of all state corporations, and not just some of them. From the 1930's onward, many of the statutes creating Government-controlled corporations said explicitly that they were agencies or instrumentalities of the United States, see, e. g., Act of June 9, 1947, § 1, 61 Stat. 130, as amended, 12 U. S. C. § 635 (creating the
That Government-created and -controlled corporations are (for many purposes at least) part of the Government itself has a strong basis, not merely in past practice and understanding, but in reason itself. It surely cannot be that government, state or federal, is able to evade the most solemn obligations imposed in the Constitution by simply resorting to the corporate form. On that thesis, Plessy v. Ferguson, 163 U.S. 537 (1896), can be resurrected by the simple device of having the State of Louisiana operate segregated trains through a state-owned Amtrak. In Pennsylvania v. Board of Directors of City Trusts of Philadelphia, 353 U.S. 230 (1957) (per curiam), we held that Girard College, which had been built and maintained pursuant to a privately erected trust, was nevertheless a governmental actor for constitutional purposes because it was operated and controlled by a board of state appointees, which was itself a state agency. Id., at 231. Amtrak seems to us an a fortiori case.
Amtrak was created by a special statute, explicitly for the furtherance of federal governmental goals. As we have described, six of the corporation's eight externally named directors (the ninth is named by a majority of the board itself) are appointed directly by the President of the United States—four of them (including the Secretary of Transportation) with the advice and consent of the Senate. See §§ 543(a)(1)(A), (C)—(D). Although the statute restricts most of the President's choices to persons suggested by certain
Respondent appeals to statements this Court made in a case involving the second Bank of the United States, Bank of United States v. Planters' Bank of Georgia, 9 Wheat. 904 (1824). There we allowed the Planters' Bank, in which the State of Georgia held a noncontrolling interest, see Act of Dec. 19, 1810, § 1, reprinted in Digest of Laws of State of Georgia 34-35 (O. Prince ed. 1822); Act of Dec. 3, 1811, § 1, id., at 35, to be sued in federal court despite the Eleventh Amendment, reasoning that "[t]he State does not, by becoming a corporator, identify itself with the corporation," 9 Wheat., at 907. "The government of the Union," we said,
Respondent also invokes our decision in the Regional Rail Reorganization Act Cases, 419 U.S. 102 (1974), which found the Consolidated Rail Corporation, or Conrail, not to be a federal instrumentality, despite the President's power to appoint, directly or indirectly, 8 of its 15 directors. See id., at 152, n. 40; Regional Rail Reorganization Act of 1973, § 301, 87 Stat. 1004. But we specifically observed in that case that the directors were placed on the board to protect the United States' interest "in assuring payment of the obligations guaranteed by the United States," and that "[f]ull voting control. . . will shift to the shareholders if federal obligations fall below 50% of Conrail's indebtedness." 419 U. S., at 152. Moreover, we noted, "[t]he responsibilities of the federal directors are not different from those of the other directors— to operate Conrail at a profit for the benefit of its shareholders," ibid. —which contrasts with the public interest "goals" set forth in Amtrak's charter, see 45 U. S. C. § 501a. Amtrak is worlds apart from Conrail: The Government exerts its control not as a creditor but as a policymaker, and no provision exists that will automatically terminate control upon termination of a temporary financial interest.
* * *
We hold that where, as here, the Government creates a corporation by special law, for the furtherance of governmental objectives, and retains for itself permanent authority to appoint a majority of the directors of that corporation, the corporation is part of the Government for purposes of the First Amendment. We express no opinion as to whether Amtrak's refusal to display Lebron's advertisement violated that Amendment, but leave it to the Court of Appeals to decide that. The judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings consistent with this opinion.
It is so ordered.
Justice O'Connor, dissenting.
The Court holds that Amtrak is a Government entity and therefore all of its actions are subject to constitutional challenge. Lebron, however, expressly disavowed this argument below, and consideration of this broad and unexpected question is precluded because it was not presented in the petition for certiorari. The question on which we granted certiorari is narrower: Whether the alleged suppression of Lebron's speech by Amtrak, as a concededly private entity, should be imputed to the Government. Because Amtrak's decision to reject Lebron's billboard proposal was a matter of private business judgment and not of Government coercion, I would affirm the judgment below.
This Court's Rule 14.1(a) provides: "Only the questions set forth in the petition, or fairly included therein, will be considered by the Court." While "[t]he statement of any question
We granted certiorari on the following question, set forth in the petition:
The question asks whether the challenged policy "was not state action" and therefore may, at first blush, appear to present the umbrella inquiry. Yee suggests otherwise. The petition there recited two decisions by the Courts of Appeals and asked: "Was it error for the state appellate court to disregard
Just so here. The question asks whether the lower court erred and thus directs our attention to the decisions below. The District Court, in its thorough order, explicitly noted Lebron's theory of the case: "Plaintiff does not contend that Amtrak is a governmental agency. What plaintiff contends is that the federal government is sufficiently entwined in Amtrak's operations and authority that the particular actions at issue must be deemed governmental action." 811 F.Supp. 993, 999 (SDNY 1993). Before the Court of Appeals, in order to distinguish a long line of cases which held that Amtrak is not a Government agency, Lebron stated: "Since Lebron does not contend that Amtrak is a governmental entity per se, but rather is so interrelated to state entities that it should be treated as a state actor here, these cases are inapposite." Brief for Michael A. Lebron in No. 93-7127 (CA2), p. 30, n. 39.
The Court of Appeals, like the District Court, substantively discussed only the second question that Lebron argues here—whether Amtrak's conduct in this case implicates "the presence of government action in the activities of private entities." 12 F.3d 388, 390 (CA2 1993). To introduce its analysis, the Court of Appeals did state that "[t]he Rail Passenger Service Act of 1970 . . . created Amtrak as a private, for-profit corporation under the District of Columbia Business Corporation Act," ibid., relying on Congress' characterization of the corporation in 45 U. S. C. § 541. In so asserting, the Court of Appeals did not "`pas[s] upon' " the question such that it is now a proper basis for reversal, ante, at 379,
The question set forth in the petition focused on the specific action by Amtrak, not on the general nature of the corporation as a private or public entity. Lebron asked whether "Amtrak's asserted policy barring the display of political advertising messages in Pennsylvania Station, New York, was not state action." App. to Pet. for Cert. i. The list that follows this question, while partially concerning Amtrak's nature as an entity, went to support the thrust of the query, which is whether these enumerated attributes render Amtrak's advertising policy state action. Lebron's emphasis on the specific action challenged is the crucial difference between his alternative arguments for state action. The first inquiry—whether Amtrak is a Government entity—focuses on whether Amtrak is so controlled by the Government that it should be treated as a Government agency, and all of its decisions considered state action. The second inquiry takes Lebron at his word that Amtrak is not a Government entity and instead focuses on the State's influence on particular actions by Amtrak as a private actor.
Fairly construed, the question presented is whether the Court of Appeals erred in holding that the advertising policy of Amtrak, as a private entity, is not attributable to the Federal Government despite the corporation's links thereto. This question is closely related and complementary to, but
Relying on United States Nat. Bank of Ore. v. Independent Ins. Agents of America, Inc., 508 U.S. 439 (1993), the Court argues that it properly addresses whether Amtrak is a Government entity because that inquiry is "prior to the clearly presented question," namely, whether Amtrak's decision is attributable to the Government. Ante, at 382. Independent Ins. Agents, however, held only that the Court of Appeals had authority to consider a waived claim sua sponte and did not abuse its discretion in doing so.
The mere fact that one question must be answered before another does not insulate the former from Rule 14.1(a) and other waiver rules. In Stone v. Powell, 428 U.S. 465 (1976),
The Court does not take issue with these cases but argues further that, because the question whether Amtrak is a Government entity is "dependent upon many of the same factual inquiries [as the clearly presented question], refusing to regard
Rule 14.1(a), of course, imposes only a prudential limitation, but one that we disregard "only in the most exceptional cases." Stone v. Powell, supra, at 481, n. 15; see also United States v. Mendenhall, 446 U.S. 544, 551, n. 5 (1980). This is not one of them. As noted before, not only did Lebron disavow the argument that Amtrak is a Government entity below, he did so in order to distinguish troublesome cases. Lebron's postpetition attempt to resuscitate the claim that he himself put to rest is precisely the kind of bait-and-switch strategy that waiver rules, prudential or otherwise, are supposed to protect against. In Steagald, supra, at 211, for example, we stated unequivocally that "the Government, through its assertions, concessions, and acquiescence, has lost its right to challenge petitioner's assertion that he possessed a legitimate expectation of privacy in the searched home." I see no difference here.
The Rule's prudential limitation on our power of review serves two important purposes, both of which the Court disserves by deciding that Amtrak is a Government entity. First, the Rule provides notice and enables the respondent to sharpen its arguments in opposition to certiorari. "By
Second, the Rule assists the management of our cases. "Rule 14.1(a) forces the parties to focus on the questions the Court has viewed as particularly important, thus enabling us to make efficient use of our resources." Yee, supra, at 536. We normally grant only petitions that present an important question of law on which the lower courts are in conflict. Here, the lower courts have generally held that Amtrak is not a Government entity, see, e. g., Anderson v. National Railroad Passenger Corporation, 754 F.2d 202, 204 (CA7 1985); Ehm v. National Railroad Passenger Corporation, 732 F.2d 1250, 1255 (CA5), cert. denied, 469 U.S. 982 (1984), and none of our cases suggest otherwise. Even where the lower courts are in clear conflict, we often defer consideration of novel questions of law to permit further development. Despite the prevalence of publicly owned corporations, whether they are Government agencies is a question
Weeding out such endeavors, Rule 14.1(a), like other waiver rules, rests firmly upon a limited view of our judicial power. See, e. g., Carducci v. Regan, 714 F.2d 171, 177 (CADC 1983) (Scalia, J.) ("The premise of our adversarial system is that appellate courts do not sit as self-directed boards of legal inquiry and research, but essentially as arbiters of legal questions presented and argued by the parties before them"). "The doctrine of judicial restraint teaches us that patience in the judicial resolution of conflicts may sometimes produce the most desirable result." Stevens, Some Thoughts on Judicial Restraint, 66 Judicature 177, 183 (1982). Whether the result of today's decision is desirable I do not decide. But I think it clear that the Court has exhibited little patience in reaching that result.
Accepting Lebron's concession that Amtrak is a private entity, I must "traverse th[e] difficult terrain," ante, at 378, that the Court sees fit to avoid, and answer the question that is properly presented to us: whether Amtrak's decision to ban Lebron's speech, although made by a concededly private entity, is nevertheless attributable to the Government and therefore considered state action for constitutional purposes. Reflecting the discontinuity that marks the law in this area, we have variously characterized the inquiry as whether "there is a sufficiently close nexus between the State and the challenged action," Jackson v. Metropolitan Edison Co., 419 U.S. 345, 351 (1974); whether the State, by encouraging the challenged conduct, could be thought "responsible for those
Lebron relies heavily on Burton v. Wilmington Parking Authority, 365 U.S. 715 (1961). There, the Court perceived a symbiotic relationship between a racially segregated restaurant and a state agency from which the restaurant leased public space. Noting that the State stood to profit from the discrimination, the Court held that the government had "so far insinuated itself into a position of interdependence with" the private restaurant that it was in effect "a joint participant in the challenged activity." Id., at 725. Focusing on this language, Lebron argues that various features of Amtrak's structure and management—its statutory genesis, the heavy reliance on federal subsidies, and a board appointed by the President—places it in a symbiotic relationship with the Government such that the decision to ban Lebron's speech should be imputed to the State.
Our decision in Burton, however, was quite narrow. We recognized "the limits of our inquiry" and emphasized that our decision depended on the "peculiar facts [and] circumstances present." Id., at 726. We have since noted that Burton limited its "actual holding to lessees of public property," Jackson v. Metropolitan Edison Co., supra, at 358, and our recent decisions in this area have led commentators to doubt its continuing vitality, see, e. g., L. Tribe, American Constitutional Law § 18-3, p. 1701, n. 13 (2d ed. 1988) ("The only surviving explanation of the result in Burton may be that found in Justice Stewart's concurrence").
These cases differ markedly from the "interdependence" or "joint participation" analysis of Burton and stand for the principle that, unless the government affirmatively influenced or coerced the private party to undertake the challenged action, such conduct is not state action for constitutional purposes. Edmonson v. Leesville Concrete Co., supra, is not to the contrary. In that case, the Court held that a private attorney's exercise of a peremptory challenge is attributable to the government and therefore subject to constitutional inquiry. Although the opinion cited Burton, see 500 U. S., at 621, 624, it emphasized that a private party exercising a peremptory challenge enjoys the "overt, significant assistance of the court," id., at 624. The decision therefore is an application of Shelley v. Kraemer, 334 U.S. 1, 19 (1948), which focused on the use of the State's coercive power, through its courts, to effect the litigant's allegedly unconstitutional choice. Moreover, Edmonson stressed that a litigant exercising a peremptory challenge performs a "traditional function of the government," 500 U. S., at 624, a theory of state action established by Marsh v. Alabama, 326 U.S. 501 (1946), that is independent from Burton and not relevant to this case.
Relying thus on Shelley and Marsh, Edmonson did not necessarily extend the "interdependence" rationale of Burton beyond the limited facts of that case. Given the pervasive role of government in our society, a test of state action predicated upon public and private "interdependence" sweeps much too broadly and would subject to constitutional challenge the most pedestrian of everyday activities, a problem that the Court recognized in Burton itself, see 365 U. S., at 725-726. A more refined inquiry is that established by Jackson, Rendell-Baker, Blum, and San Francisco Arts & Athletics: The conduct of a private entity is not subject to constitutional scrutiny if the challenged action results from
Applying this principle to the facts before us, I see no basis to impute to the Government Amtrak's decision to disapprove Lebron's advertisement. Although a number of factors indicate the Government's pervasive influence in Amtrak's management and operation, none suggest that the Government had any effect on Amtrak's decision to turn down Lebron's proposal. The advertising policy that allegedly violates the First Amendment originated with a predecessor to Amtrak, the wholly private Pennsylvania Railroad Company. A 1967 lease by that company, for example, prohibited "any advertisement which in the judgement of Licensor is or might be deemed to be slanderous, libelous, unlawful, immoral, [or] offensive to good taste . . . ."App. 326, ¶ 19. Amtrak simply continued this policy after it took over. The specific decision to disapprove Lebron's advertising was made by Amtrak's Vice President of Real Estate and Operations Development, who, as a corporate officer, was neither appointed by the President nor directed by the Presidentappointed board to disapprove Lebron's proposal.
Lebron nevertheless contends that the board, through its approval of the advertising policy, controlled the adverse action against him. This contention rests on the faulty premise that Amtrak's directors are state actors simply because they were appointed by the President; it assumes that the board members sit as public officials and not as business directors, thus begging the question whether Amtrak is a Government agency or a private entity. In any event, even accepting Lebron's premise that the board's approval has constitutional significance, the factual record belies his contention. The particular lease that permitted Amtrak to disallow Lebron's billboard was neither reviewed nor approved directly by the board. In fact, minutes of meetings dating back to 1985 showed that the board approved only one contract between Amtrak and Transportation Displays, Incorporated,
Presented with this question, the Court of Appeals properly applied our precedents and did not impute Amtrak's decision to the Government. I would affirm on this basis and not reverse the Court of Appeals based on a theory that is foreign to this case. Respectfully, I dissent.
"Whether the court of appeals erred in holding that Amtrak's asserted policy barring the display of political advertising messages in Pennsylvania Station, New York, was not state action, where:
"(a) the United States created Amtrak, endowed it with governmental powers, owns all its voting stock, and appoints all members of its Board;
"(b) the United States-appointed Board approved the advertising policy challenged here;
"(c) the United States keeps Amtrak afloat every year by subsidizing its losses; and
"(d) Pennsylvania Station was purchased for Amtrak by the United States and is shared with several other governmental entities."
"`Two federal courts of appeal have held that the transfer of a premium value to a departing mobilehome tenant, representing the value of the right to occupy at a reduced rate under local mobilehome rent control ordinances, constitute[s] an impermissible taking. Was it error for the state appellate court to disregard the rulings and hold that there was no taking under the fifth and fourteenth amendments?' " 503 U. S., at 536-537.
The dissent also seeks to characterize Independent Ins. Agents as no more than an application of "the traditional principle that there can be no estoppel in the way of ascertaining the existence of a law." Post, at 404 (internal quotation marks omitted). It was indeed an application of that principle insofar as concerned the claim that the appellants' right to assert repeal of the statute had been forfeited. But forfeit was not the only point decided in the case: not every nonforfeited claim merits consideration on appeal.