Chicanos Por La Causa, Inc. v. Napolitano

544 F.3d 976

CHICANOS POR LA CAUSA, INC.; Somos America, Plaintiffs-Appellants, and Arizona Employers for Immigration Reform Inc.; Chamber of Commerce of the United States; Arizona Chamber of Commerce; Arizona Hispanic Chamber of Commerce; Arizona Farm Bureau Federation; Arizona Restaurant and Hospitality Association; Associated Minority Contractors of America; Arizona Roofing Contractors Association; National Roofing Contractors Association; Wake Up Arizona! Inc.; Arizona Landscape Contractors' Association; Arizona Contractors Association, Plaintiffs, v. Janet NAPOLITANO; Terry Goddard; Gale Garriott, Defendants-Appellees.

Chicanos Por La Causa, Inc.; Somos America, Plaintiffs, and Arizona Employers for Immigration Reform Inc.; Chamber of Commerce of the United States; Arizona Chamber of Commerce; Arizona Hispanic Chamber of Commerce; Arizona Farm Bureau Federation; Arizona Restaurant and Hospitality Association; Associated Minority Contractors of America; Arizona Roofing Contractors Association; National Roofing Contractors Association; Wake Up Arizona! Inc.; Arizona Landscape Contractors' Association; Arizona Contractors Association, Plaintiffs-Appellants, v. Janet Napolitano; Terry Goddard; Gale Garriott, Defendants-Appellees.

Arizona Contractors Association, Inc.; Arizona Employers for Immigration Reform Inc.; Chamber of Commerce of the United States; Arizona Chamber of Commerce; Arizona Hispanic Chamber of Commerce Inc.; Arizona Farm Bureau Federation; Arizona Restaurant and Hospitality Association; Associated Minority Contractors of America; Arizona Roofing Contractors Association; National Roofing Contractors Association; Arizona Landscape Contractors' Association, Plaintiffs-Appellants, and Wake Up Arizona! Inc.; Valle Del Sol Inc.; Chicanos Por La Causa, Inc.; Somos America, Plaintiffs, v. Criss Candelaria; Ed Rheinheimer; Terrence Haner; Daisy Flores; Kenny Angle; Derek D. Rapier; Martin Brannan; Andrew P. Thomas; Matthew J. Smith; James Currier; Barbara Lawall James P. Walsh; George Silva; Sheila Polk; Jon Smith; Terry Goddard; Fidelis V. Garcia; Gale Garriott; Melvin R. Bowers Jr., Defendants-Appellees.

Arizona Contractors Association, Inc.; Arizona Employers for Immigration Reform Inc.; Chamber of Commerce of the United States; Arizona Chamber of Commerce; Arizona Hispanic Chamber of Commerce Inc.; Arizona Farm Bureau Federation; Arizona Restaurant and Hospitality Association; Associated Minority Contractors of America; Arizona Roofing Contractors Association; National Roofing Contractors Association; Arizona Landscape Contractors' Association, Plaintiffs, and, Wake Up Arizona! Inc.; Valle Del Sol Inc.; Chicanos Por La Causa, Inc.; Somos America, Plaintiffs-Appellants, v. Criss Candelaria; Ed Rheinheimer; Terrence Haner; Daisy Flores; Kenny Angle; Derek D. Rapier; Martin Brannan; Andrew P. Thomas; Matthew J. Smith; James Currier; Barbara Lawall James P. Walsh; George Silva; Sheila Polk; Jon Smith; Terry Goddard; Fidelis V. Garcia; Gale Garriott; Melvin R. Bowers Jr., Defendants-Appellees.

Arizona Contractors Association, Inc.; Arizona Employers for Immigration Reform Inc.; Chamber of Commerce of the United States; Arizona Chamber of Commerce; Arizona Hispanic Chamber of Commerce Inc.; Arizona Farm Bureau Federation; Arizona Restaurant and Hospitality Association; Associated Minority Contractors of America; Arizona Roofing Contractors Association; National Roofing Contractors Association; Arizona Landscape Contractors' Association, Plaintiffs, Valle Del Sol Inc.; Chicanos Por La Causa, Inc.; Somos America, Plaintiffs, and Wake Up Arizona! Inc., Plaintiff-Appellant, v. Criss Candelaria; Ed Rheinheimer; Terrence Haner; Daisy Flores; Kenny Angle; Derek D. Rapier; Martin Brannan; Andrew P. Thomas; Matthew J. Smith; James Currier; Barbara Lawall James P. Walsh; George Silva; Sheila Polk; Jon Smith; Terry Goddard; Fidelis V. Garcia; Gale Garriott; Melvin R. Bowers Jr., Defendant-Appellant.

Nos. 07-17272, 07-17274, 08-15357, 08-15359, 08-15360.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted June 12, 2008.

Filed September 17, 2008.

COPYRIGHT MATERIAL OMITTED

Jonathan Weissglass, San Francisco, CA, attorney for plaintiffs/appellants.

Mary O'Grady, Phoenix, AZ, for the State defendants/appellees.

Roger W. Hall, Buckley King, Phoenix, AZ, for defendant/appellees, Apache, Cochise, Gila, Graham, Greenlee, La Paz, Navajo, Santa Cruz, and Yavapai Counties.

Daniel Jurkowitz, Tucson, AZ, for defendant/appellee, Pima County.

Before: MARY M. SCHROEDER, JOHN M. WALKER, JR.,^* and N. RANDY SMITH, Circuit Judges.

SCHROEDER, Circuit Judge:

This case is a facial challenge to an Arizona state law, enacted in 2007 and aimed at illegal immigration, that reflects rising frustration with the United States Congress's failure to enact comprehensive immigration reform. The Arizona law, called the Legal Arizona Workers Act, targets employers who hire illegal aliens, and its principal sanction is the revocation of state licenses to do business in Arizona. It has yet to be enforced against any employer.

Various business and civil-rights organizations (collectively, "plaintiffs") brought these actions against the fifteen county attorneys of the state of Arizona, the Governor of Arizona, the Arizona Attorney General, the Arizona Registrar of Contractors, and the Director of the Department of Revenue of Arizona (collectively, "defendants"). Plaintiffs allege that the Legal Arizona Workers Act ("the Act"), Ariz.Rev. Stat. §§ 23-211 to 23-216, is expressly and impliedly preempted by the federal Immigration Reform and Control Act of 1986 ("IRCA"), 8 U.S.C. §§ 1324a-1324b, and the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 ("IIRIRA"), Pub.L. No. 104-208, 110 Stat. 3009 (1996), codified in various sections of 8 U.S.C. and 18 U.S.C. They also allege that the Act violates employers' rights to due process by denying them an opportunity to challenge the federal determination of the work-authorization status of their employees before sanctions are imposed.

The district court held that the law was not preempted. The main argument on appeal is that the law is expressly preempted by the federal immigration law provision preempting state regulation "other than through licensing and similar laws." 8 U.S.C. § 1324a(h)(2). The district court correctly determined that the Act was a "licensing" law within the meaning of the federal provision and therefore was not expressly preempted.

There is also a secondary, implied preemption issue that principally relates to the provision requiring employers to use the electronic verification system now being refined by the federal government as a tool to check the work-authorization status of employees through federal records. It is known as E-Verify. Under current federal immigration law, use of the system is voluntary, and the Arizona law makes it mandatory. We hold that such a requirement to use the federal verification tool, for which there is no substitute under development in either the state, federal, or private sectors, is not expressly or impliedly preempted by federal policy.

Plaintiffs also contend that the statute does not guarantee employers an opportunity to be heard before their business licenses may be revoked. The statute can and should be reasonably interpreted to allow employers, before any license can be adversely affected, to present evidence to rebut the presumption that an employee is unauthorized.

We uphold the statute in all respects against this facial challenge, but we must observe that it is brought against a blank factual background of enforcement and outside the context of any particular case. If and when the statute is enforced, and the factual background is developed, other challenges to the Act as applied in any particular instance or manner will not be controlled by our decision. See Crawford v. Marion County Election Bd., ___ U.S. ___, 128 S.Ct. 1610, 1621, 170 L.Ed.2d 574 (2008) (describing heavy burden of persuasion to sustain a broad attack on the facial validity of a statute in all its applications).

Background

Sanctions for hiring unauthorized aliens were first created at the federal level when Congress passed IRCA in 1986. See Pub.L. No. 99-603, 100 Stat. 3359 (1986). IRCA prohibits knowingly or intentionally hiring or continuing to employ an unauthorized alien, 8 U.S.C. § 1324a(a), which it defines as an alien either not lawfully admitted for permanent residence or not authorized to be employed by IRCA or the U.S. Attorney General, 8 U.S.C. § 1324a(h)(3).

IRCA also sets out the method of demonstrating an employer's compliance with the law through a paper-based method of verifying an employee's eligibility, known as the I-9 system. Id. § 1324a(b). It requires employees to attest to their eligibility to work and to present one of the specified identity documents. Id. § 1324a(b)(1), (2). IRCA then requires employers to examine the identity document the employee presents and attest that it appears to be genuine. Id. § 1324a(b)(1)(A). The employer is entitled to a defense to sanctions if the employer shows good-faith compliance with the I-9 system, unless the employer has engaged in a pattern or practice of violations. Id. § 1324a(b)(6).

The Attorney General is charged with enforcing violations of IRCA. Id. § 1324a(e). Hearings are held before selected administrative law judges ("ALJs"), and the ALJs' decisions are reviewable by the federal courts. Id. § 1324a(e)(3).

IRCA contains an express preemption provision, which states: "The provisions of this section preempt any State or local law imposing civil or criminal sanctions (other than through licensing and similar laws) upon those who employ, or recruit or refer for a fee for employment, unauthorized aliens." Id. § 1324a(h)(2). The scope of the savings clause, which permits state "licensing and similar laws," is a critical issue in this appeal.

IIRIRA dire...