
USCA1 Opinion

	




                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 97-1279                                 ALFRED RASO, ET AL.,                               Plaintiffs, Appellants,                                          v.                                 MARISA LAGO, ET AL.,                                Defendants, Appellees.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                       [Hon. Mark L. Wolf, U.S. District Judge]                                           ___________________                                 ____________________                                        Before                               Selya, Boudin and Stahl,                                    Circuit Judges.                                    ______________                                 ____________________            Chester Darling for appellants.            _______________            Saul A.  Schapiro with  whom Nina  F.  Lempert, Thomas  Bhisitkul,            _________________            _________________  _________________        Rosenberg  & Schapiro, Merita  Hopkins, Corporation Counsel,  Kevin S.        _____________________  _______________                        ________        McDermott  and Amanda P. O'Reilly, Assistant Corporation Counsel, City        _________      __________________        of Boston  Law Department, were  on briefs for appellees  Marisa Lago,        Director   of  the   Boston   Redevelopment   Authority,  the   Boston        Redevelopment Authority, Thomas  A. Menino, Mayor  of Boston, City  of        Boston,  Victoria L. Williams,  Director of  the  Boston Fair  Housing        Commission, Boston Fair Housing Commission, Sandra Henriquez, Director        of the Boston Housing Authority and Boston Housing Authority.            Rudolph  F.  Pierce  with  whom  Lynne  Alix  Morrison,  David  W.            ___________________              _____________________   _________        Fanikos, Goulston & Storrs, P.C.,  Richard M. Bluestein, Paul Holtzman        _______  _______________________   ____________________  _____________        and  Krokidas &  Bluestein were  on brief  for Robert  H. Kuehn,  Jr.,             _____________________        President  of Keen  Development Corp.,  and as  Trustee of  the Lowell        Square  Nominee Trust,  Keen Development  Corp.,  Reverend Michael  F.        Groden, Director of  the Planning Office for Urban  Affairs, Inc., and        as Trustee  of the  Lowell Square Nominee  Trust, Planning  Office for        Urban  Affairs, Inc., Lowell  Square Associates Joint  Venture, Lowell        Square  Cooperative Limited  Partnership,  Mark Maloney,  President of        Maloney Properties, Inc., and Maloney Properties, Inc.            Susan M. Poswistilo, Assistant United  States Attorney, with  whom            ___________________        Donald K. Stern,  United States Attorney,  was on brief  for Henry  G.        _______________        Cisneros, Secretary of the Department of Housing and Urban Development        and Department of Housing and Urban Development.                                              ____________________                                   January 27, 1998                                 ____________________                 BOUDIN,  Circuit Judge.  The plaintiffs in this case are                          _____________            former residents of Boston's Old  West End who were forced to            relocate when their  homes were taken  by eminent domain  for            urban  renewal.  They  claim that Massachusetts  law entitles            them  to first preference for tenancy  of all new residential            units built on the land, and that they are  being denied this            preference in a new development called West End Place because            most  former  West  Enders are  white.    The  district judge            dismissed the complaint, leading to this appeal.                 The background facts  are undisputed.  In May  1956, the            Boston  Housing  Authority,  the  forerunner  to  the current            Boston  Redevelopment Authority ("the BRA"),1 prepared a plan            for  urban  renewal of  Boston's  Old  West End,  a  downtown            neighborhood lying just  north of Beacon Hill.   The plan was            approved  as required under  Massachusetts law, and  in 1958,            the BRA ordered  a taking by eminent domain of  a large area,            displacing  over   three  thousand   households  of   diverse            heritages, but including few African Americans.                 The  BRA executed  a  lease  agreement  with  a  private            developer,  Charles River Park, Inc. ("Charles River").  Over            the next ten years, Charles  River razed buildings in the Old            West  End   and  built  offices,  condominiums,   and  luxury                                            ____________________            1The  BRA is  an entity  established  by the  Commonwealth of            Massachusetts  to  undertake  urban renewal  projects  and to            relieve  housing  shortages.   See  Collins  v.  Selectmen of                                           ___  _______      ____________            Brookline, 325 Mass. 562, 564-66 (1950).            _________                                         -3-                                         -3-            residential   units.     The   new   buildings  were   either            nonresidential or  so expensive that  very few of  the former            West Enders could afford to occupy them.                 In 1970, the BRA terminated Charles River as the project            developer   and,  in   1986,  solicited  proposals   for  the            development  of Lowell Square, located at the intersection of            Lomasney Way and  Staniford Street, the only  remaining large            undeveloped  section of  the Old  West End.   A  proposal was            submitted   by   the   Lowell   Square  Cooperative   Limited            Partnership (the  "developer")  to build  a  new  development            called West End Place at Lowell Square.2                   The   BRA   eventually   awarded   the   developer   the            redevelopment  contract.   One restriction  in  the agreement            between  the BRA  and  the developer  mirrors a  provision of            Massachusetts law requiring the BRA to obligate the developer            as follows:                 (c)  to give preference in the selection of tenants                 for dwelling  units built  in the  project area  to                 families displaced  therefrom because  of clearance                 and renewal  activity who  desire to  live in  such                 dwelling units and who will be able to pay rents or                 prices  equal  to  rents  or prices  charged  other                 families for  similar or comparable  dwelling units                 built as a part of the same redevelopment; and                  (d) to  comply with  such other  conditions as  are                 deemed  necessary to carry out the purposes of this                 chapter, or requirements of  federal legislation or                                            ____________________            2The  partnership later  underwent  a  name  change  and,  in            addition,  the  complaint  names other  private  entities and            individuals associated  with it.   For  convenience, all  are            referred to as "the developer."                                         -4-                                         -4-                 regulations   under   which    loans,   grants   or                 contributions have been  made or agreed to  be made                 to meet a part of the cost of the project.            Mass. Gen. Laws ch. 121B,   49 (1986).                 The  BRA also required  that the developer  work closely            with former West Enders in  developing the property.  To that            end,  a number of former West  Enders formed the Old West End            Housing Corporation.  This nonprofit entity and the developer            signed a  participation agreement, which stated,  inter alia,                                                              __________            that former West  Enders would have  first preference in  the            purchase  or rental of  residential units in  West End Place,            subject to applicable local, state, and federal laws.                 The  developer sought out numerous sources of financing,            including government funding from  local, state, and  federal            agencies.  In  particular, the federal Department  of Housing            and Urban Development  ("HUD") funded a grant of $2.5 million            for  construction, and it  also committed $7  million in rent            subsidies for the low-income units in West End Place.  See 42                                                                   ___            U.S.C.   1437f (1994).  Like most federal housing assistance,            these funds were  contingent on compliance with  federal fair            housing requirements.  See 24 C.F.R.    1.5, 5.105 (1997).                                   ___                 One  such requirement  is that  developer recipients  of            federal housing funds  must carry out an  affirmative program            to attract  minority, as  well as  majority, applicants;  the            pertinent  regulation   contemplates  mailings   to  minority            organizations,  assurances  of  nondiscrimination,  and  like                                         -5-                                         -5-            measures.    Each applicant  is  required  to  set forth  its            "affirmative fair housing  marketing plan" on a  HUD form and            secure its approval by HUD.  See 24 C.F.R.    200.620 (1997).                                         ___                 In addition,  HUD is  subject to  a 1991  consent decree            based  on a  finding that  HUD had  failed to  meet statutory            obligations  to ensure that the minority population of Boston            had equal access to public housing.  NAACP, Boston Chapter v.                                                 _____________________            Kemp, No.  78-850-S (D. Mass. Mar. 8, 1991) (consent decree).            ____            The   consent  decree  provides  that  all  Boston  area  HUD            affirmative fair housing marketing plans "shall have as their            goal  and measure  of  success the  achievement  of a  racial            composition, in HUD-assisted housing located in neighborhoods            which  are  predominantly  white, which  reflects  the racial            composition of the City [of Boston] as a whole."  Id. at 2.3                                                              ___                 In  preparing  its  affirmative  fair housing  marketing            plan,  the  developer  attempted  to reconcile  the  explicit            statutory  obligation of a  first preference for  former West            Enders with HUD's consent-decree goal of a tenancy reflecting            the makeup of the City of Boston.  Minority races made  up 41            percent  of  Boston's  population,  but  according  to  HUD's                                            ____________________            3The consent decree ended lengthy litigation,  which included            an  appeal  to  this  court,  over  HUD's  duties  to  foster            integrated housing.  See NAACP, Boston Chapter v. Pierce, 624                                 ___ _____________________    ______            F. Supp. 1083 (D. Mass. 1985), vacated and remanded, NAACP v.                                           ____________________  _____            Secretary  of Hous.  & Urban  Dev.,  817 F.2d  149 (1st  Cir.            __________________________________            1987), on remand, NAACP, Boston Chapter v. Kemp, 721 F. Supp.                   _________  _____________________    ____            361 (D. Mass. 1989).  The decree provided that its provisions            did  not "constitute"  and  should not  be  "construed as"  a            quota.                                         -6-                                         -6-            estimate, only  about 2  percent of the  former West  Enders.            HUD  indicated that it  viewed an unqualified  preference for            former  West Enders  as  contrary  to  federal  fair  housing            requirements and the consent decree.                   The developer, the government agencies, and the Old West            End Housing  Corporation submitted  the matter to  mediation.            The   mediator,  a   former   United   States  Attorney   for            Massachusetts,  proposed that  former West  Enders receive  a            preference as  to 55 percent of the  units in West End Place,            and all other  applicants have equal access to  the remaining            45 percent.   The developer and the agencies  agreed; the Old            West  End Housing  Corporation did  not.   Nevertheless,  the            mediator's   solution  was   included   in  the   developer's            affirmative fair  housing marketing plan, which  HUD approved            in 1996.                 The plan operates as follows.   West End Place  contains            183  residential  units  that  fall  into   three  rent-based            categories: 58 "low-income" units (subsidized by HUD  funds),            48  "moderate-income units,"  and 77  units  to be  rented at            market  rates.   Under the  plan,  the developer  is to  give            former West Enders  first preference as to 101  of 183 units,            that  is,  55 percent  of  the total.   These  101  units are            unevenly distributed over  the three rent categories:  former            West Enders have  a preference as to 19  low-income units (33                                         -7-                                         -7-            percent),  24  moderate-income  units (50  percent),  and  58            market-rate units (75 percent).                 The tenant selection works by lottery.  Each preliminary            application  is assigned a  random number.   The applications            are   then  separated  into   two  pools:  pool   A  contains            applications from  displaced former  West Enders  and pool  B            contains  all other  applicants.   Then,  for the  low-income            units,  the top-ranked  applicant from  pool  A is  selected,            followed by the two  top-ranked applicants from pool  B; this            yields a  total of 33  percent pool A applicants  (33 percent            former West Enders) in the  low-income units.  The process is            then repeated until all 58 units are tentatively allocated.                 The  same lottery  approach is  used for  the other  two            categories  of apartments.   For  moderate-income units,  the            draw ratio is one-to-one (50 percent former West Enders); for            the market-rate units,  three-to-one (75 percent former  West            Enders).  Applicants who  have been selected in this  process            are then invited to complete a full application and undergo a            more   thorough   screening   process,  which   can   include            verifications of personal references and credit history.  The            same process can supply additional applicants if needed.                 From  August 26  to September  26, 1996,  a real  estate            manager hired by the developer coordinated community outreach            efforts  to stimulate preliminary  applications.  The manager            also contacted former West Enders as well as the Old West End                                         -8-                                         -8-            Housing Corporation.   The manager eventually  received 1,858            timely preliminary applications, 308 of  which identified the            applicants as  former West  Enders.  Of  the 308  former West            Ender applicants, 12  identified themselves as black,  one as            Latino, and 19 did not identify their race.                   On September 26,  1996, the individual  plaintiffs--four            former West Enders--filed  a complaint in the  district court            challenging  the tenant  selection process  and  the plan  on            numerous  grounds;  they purported  to represent  former West            Enders as a  class.  The Old West End Housing Corporation was            also named  as a plaintiff.   The numerous  defendants divide            into four categories:  the BRA and its director;  HUD and its            Secretary; the City  of Boston and various  of its officials;            and,  finally,  the  developer   and  other  private  parties            associated with the development of West End Place.                  On October 21,  1996, the plaintiffs filed  an emergency            motion  for a  preliminary injunction  to  halt the  lottery,            which was later withdrawn  when the defendants agreed  to let            the  former West Enders' representatives monitor the lottery.            In the lottery, which took place on October 29, 1996,  two of            the  named plaintiffs received  rankings in the  lottery that            make it  unlikely that  they will receive  units in  West End            Place.                 The developer  and  various other  defendants  moved  to            dismiss the  complaint,  Fed. R.  Civ. P.  12(b)(6), and  the                                         -9-                                         -9-            district court heard  argument on the motion on  November 20,            1996.   On  January 6,  1997,  the district  court issued  an            opinion dismissing  many of the claims with  prejudice.  Raso                                                                     ____            v. Lago, 958 F. Supp. 686 (D. Mass. 1997).  After  the former               ____            West  Enders  declined  to amend  their  complaint  to allege            discriminatory  implementation  of the  plan--an  opportunity            offered by  the district court--the district  court dismissed            all  claims with  prejudice  and  entered  judgment  for  the            defendants on February 11, 1997.                 The former West Enders appeal from the dismissal of only            two of the  numerous claims they made in  the district court:            first, a claim under 42 U.S.C.   1983 that the plan  violates            equal protection  principles because it comprises a forbidden            racial  classification, and second,  a claim that  section 49            creates  a trust  that subjects  the BRA  and developer  to a            trustee's  fiduciary duties  in  favor  of  the  former  West            Enders.    There are  also  a  few  references to  the  Tenth            Amendment  and to federal  statutes but these  references are            not seriously developed in plaintiffs' briefs.                 We begin with section  1983, which pertinently  provides            that  no  person  may  deprive  any  person  of  his  or  her            constitutional rights under color of  state law.  42 U.S.C.              1983.    The  City of  Boston  and the  BRA  are  both "state            actors," see Monell  v. Department of  Soc. Servs., 436  U.S.                     ___ ______     __________________________            658,  690  (1978), and  the  BRA  played  a central  role  in                                         -10-                                         -10-            developing and  fostering the plan challenged  by plaintiffs.            HUD is a federal  entity not subject to section 1983, but its            officials  are  directly  constrained   by  equal  protection            principles.4                 In their complaint,  the former West Enders  allege that            race was  a motive  for curtailing  the statutory  preference            otherwise  available to  them.   Specifically, the  complaint            cites the  defendants' reliance  upon the  consent decree  as            comprising a racial  purpose and goal and asserts  that, as a            result,  the former West Enders were deprived of a benefit--a            statutory preference for all of the apartments--based upon "a            racial classification."   In their appeal  brief, plaintiffs'            shorthand  version  is  that  the  preference  was  curtailed            "because" the former West Enders were predominantly white.                 Factual assertions in a  complaint are normally accepted            as  true for  purposes of  a  motion to  dismiss, see,  e.g.,                                                              __________            Berner  v. Delahanty,  129 F.3d  20, 25  (1st Cir.  1997); in            ______     _________            addition,  the defendants do not dispute that racial concerns            and the consent decree prompted their effort to cut back upon            the  statutory preference.    The reason  is  apparent:   the                                            ____________________            4The Fifth Amendment's  Due Process Clause embodies  the core            of the equal protection doctrine,  see Bolling v. Sharpe, 347                                               ___ _______    ______            U.S. 497, 499-500  (1954), and the Secretary of  HUD, a named            defendant in  this case, is  subject to  suit for  injunctive            relief for violations of the Constitution.  See, e.g., Larson                                                        _________  ______            v. Domestic &  Foreign Commerce Corp.,  337 U.S. 682,  689-91               __________________________________            (1949); E. Chemerinsky, Federal Jurisdiction   9.1.1, at 451-                                    ____________________            52 (1989).                                         -11-                                         -11-            former West  Enders are  almost entirely  white, and  without            some  limitation  on  the preference  rights  of  former West            Enders, HUD  would  have been  funding subsidized  apartments            from which minorities were effectively excluded.                 HUD apparently thought  that this outcome  would violate            the  consent decree and  its statutory obligation  to promote            fair housing.   See 42 U.S.C.    3601-3619  (1994); 24 C.F.R.                            ___               200.600-200.640 (1997).   HUD may have  misunderstood both            the consent decree  and the federal  statute, but whether  it            did  or not, its  purpose to increase  minority opportunities                              _______            for apartments in West End  Place by curtailing the statutory            preference  is evident.   To  this end,  it appears  that HUD            simply declined to authorize funding unless and until some of            the apartments were  made available to applicants  other than            former West Enders.                 This undenied racial motive distinguishes  the case from            those  others  involving  facially  neutral  actions--like  a            zoning law  or employee qualification  test--where the  state            actor denies  any  racial  purpose  or  concern.5    But  the            plaintiffs  are mistaken  in treating  "racial  motive" as  a            synonym   for    a   constitutional    violation.       Every                                            ____________________            5See,  e.g., Village  of  Arlington  Heights v.  Metropolitan             __________  _______________________________     ____________            Hous. Dev.  Corp., 429 U.S.  252, 270-71 (1977)  (upholding a            _________________            refusal  to rezone property  to allow construction  of multi-            dwelling  buildings); Washington v. Davis, 426 U.S. 229, 247-                                  __________    _____            48 (1976) (upholding  a police department literacy  exam that            excluded mostly black applicants).                                         -12-                                         -12-            antidiscrimination  statute aimed  at racial  discrimination,            and every  enforcement measure  taken under  such a  statute,            reflect  a  concern with  race.    That  does not  make  such            enactments  or actions  unlawful  or automatically  "suspect"            under the Equal Protection Clause.                 It is  quite true  that government  action taken out  of            hostility to  a racial  group can be  condemned out  of hand,            e.g., Yick  Wo v. Hopkins,  118 U.S. 356, 373-74  (1886), but            ____  ________    _______            there is no  allegation whatever  in the  complaint that  the            defendants were hostile to whites.  Nor would any such motive            be remotely  plausible.   Benign intentions  do not  immunize            government action, but they substantially narrow the inquiry.            The primary test is that any government action--regardless of            benign intent--is suspect  if it has been taken  on the basis            of   a   "racial   classification";  in   such   cases,   the            classification  must  be  justified  by  a  compelling  state            interest and  narrow  tailoring.   See Adarand  Constructors,                                               ___ ______________________            Inc. v. Pena, 515 U.S. 200, 235 (1995).                ____    ____                 Despite  the use  of the "racial  classification" label,            the complaint  alleges no facts  that would bring  that label                                      _____            into  play.   See Shaw  v. Digital  Equipment Corp.,  82 F.3d                          ___ ____     ________________________            1194, 1216 (1st  Cir. 1996).  The  term normally refers to  a            governmental standard,  preferentially favorable to  one race            or another, for the distribution of benefits.  E.g., Adarand,                                                           ____  _______            515 U.S. at 226-27; City of Richmond v.  J.A. Croson Co., 488                                ________________     _______________                                         -13-                                         -13-            U.S. 469, 493 (1989) (plurality opinion).  Yet under the plan            adopted in this case, the apartments freed from the statutory            preference are made available to all applicants regardless of                                             ___            race.                 West  End Place  was  built with  federal  help and  its            apartments   made   especially  desirable   through   federal            subsidies.  It might not seem remarkable  that the government            should insist, as a condition of this investment, that a fair            number  of the  apartments  should  be  effectively  open  to            application by tenants of all races.   Nor have we been  able            to find  any case where  the government has been  required to            show  a compelling interest, or narrow tailoring of remedies,            for a  condition framed  so as to  secure equal  treatment of                                                      _____            applicants regardless of race.                   Language in a few Supreme Court decisions could be taken            to  mean that  any  action  in which  race  plays  a role  is                           ___            constitutionally suspect.  However, the governmental  actions            in  those   cases  were  fundamentally   different  and  more            provocative.  In Adarand, the statute gave special incentives                             _______            to government  contractors to hire  minority subcontractors.6            The  redistricting  cases  concern   state  voting  districts                                            ____________________            6See Adarand, 515 U.S.  at 205-06; see also Croson,  488 U.S.             ___ _______                       ________ ______            at 493-94; Wygant v. Jackson Bd. of Educ., 476 U.S. 267, 279-                       ______    ____________________            80  (1986)  (plurality  opinion);  R.  Rotunda  &  J.  Nowak,            Constitutional Law   18.10(a)(1) (2d ed. 1992 & Supp. 1997).            __________________                                         -14-                                         -14-            designed to  concentrate minority  voters and  effectively to            reserve seats for minority candidates.7                   Taken by itself, HUD's action in this case is almost the            opposite of the  racial preferences that the  Court viewed as            questionable in Adarand  and the redistricting cases.   Here,                            _______            the government's condition  on federal funds was that some of            the   apartments--which    otherwise   would    have   almost            automatically been  occupied by whites--be made  available to            all applicants on a race-blind basis.  We cannot view this as            a "racial classification[]" reserving benefits for  a favored            race, Adarand, 515 U.S. at 235, or as "an effort to segregate                  _______            the races," Shaw, 509 U.S. at 642-43.                        ____                 Several  other equal  protection arguments  made  by the            former West Enders need no lengthy discussion, either because            they have  been essentially  abandoned on  appeal or  because            they  are clearly unpersuasive.  The former category includes            the former West Enders'  attack on HUD requirements that  the            apartments be publicized in minority communities;8 the latter            includes  the attempt to charge HUD with treating the consent                                            ____________________            7See Bush  v. Vera, 116  S. Ct. 1941, 1955  (1996) (plurality             ___ ____     ____            opinion); Miller  v. Johnson,  515 U.S.  900, 906-09  (1995);                      ______     _______            Shaw v. Reno, 509 U.S. 630, 635-36 (1993).             ____    ____            8HUD's  regulations  require  affirmative  outreach  in  both            majority   and  minority   communities,  see   24  C.F.R.                           ___                           ___            200.620(a); and in any case outreach efforts are not the real            source  of the plaintiffs' problem--rather, it is the partial            loss of their preference.   The defendants are no less guilty            of muddling the issue in their pretense that outreach efforts            are all that are involved in this case.                                         -15-                                         -15-            decree's numerical  "goal" as  if it were  a quota--a  notion            belied  by the substantial preference retained for the former            West Enders.                 The  story, however, is not quite over.  It is one thing            for  HUD to  insist  that the  apartments it  subsidizes must            effectively be open  to all races; it would  be quite another            if HUD  planned  to impose  this requirement  only where  the            beneficiaries  of the statutory preference were white.  That,            we  think,  would be  government  action based  on  a "racial            classification" and  would need  to be  narrowly tailored  to            serve a compelling government interest.                 The difficulty  is that we  are dealing here with  an ad                                                                       __            hoc  administrative action.    Accepting  the  truth  of  the            ___            complaint's factual allegations, HUD's actions were  prompted            not by any  general, racially skewed policy  toward statutory            preferences but by the peculiar interplay of Boston's consent            decree, the Massachusetts statute, and the  respective racial            makeups of the Boston population and  the former West Enders.            What HUD  would  do  in  some  other,  hypothetical  case  is            unknown, but  it is  certainly not  precluded, either  by the            consent decree  or anything else, from  challenging statutory            preferences that exclude whites.   Cf. Otero v. New York City                                               ___ _____    _____________            Hous. Auth., 484 F.2d 1122, 1125 (2d Cir. 1973).            ___________                 The  plaintiffs have alleged  no facts that,  if proven,            would reveal  any secret discriminatory  standard, pattern of                                         -16-                                         -16-            past practice,  or motive  beyond the one  HUD has  admitted,            namely HUD's concern that the preference in this instance, if            unmodified,  would  restrict  the  apartments  to whites  and            subject   HUD  to   sanctions   under  the   consent  decree.            Plaintiffs  simply think  that  this  purpose  is  enough  to            condemn HUD'saction.  Forthe reasons already given,we do not.                 We turn now to plaintiffs' second and  distinct claim on            appeal that Mass.  Gen. Laws ch. 121B,   49,  "has the effect            of creating  a trust for  the benefit of people  displaced by            urban renewal."   The district court ruled that  there was no            demonstrated  legislative intent to  create a trust  and that            the  trust argument  failed  for  a  further  more  technical            reason.   See 958 F. Supp. at 700  (citing New Eng. Trust Co.                      ___                              __________________            v. Sanger, 337 Mass. 342, 348 (1958)).  On appeal, plaintiffs               ______            devote five pages of their brief to discussing the requisites            for trust creation under Massachusetts law.                 Whether or not Massachusetts law created a trust for the            former West Enders appears to us to  be beside the point.  If            we assume arguendo  that the former West Enders  are entitled                      ________            to,  and can  enforce, whatever  priority  is provided  under            section  49, subject always  to superseding federal  law, the            trust concept  is nothing  more than  a possible  alternative            remedy for enforcing  any unpreempted rights that  section 49            may provide.   The question to  be answered, before  remedies            are even pertinent, is the extent of those rights.                                         -17-                                         -17-                 By  its terms  section  49(c)  creates  a  priority  for            displaced  former  residents,  and  subsection  (d)  arguably            qualifies this priority  by also obligating the  developer to            comply   with  "requirements   of   federal  legislation   or            regulations  under which loans, grants, or contributions have            been made or agreed to be made to meet a part of  the cost of            the project."   Mass.  Gen.  Laws ch.  121B,    49(d).    The            defendants'  position, adopted by the district court, is that            such federal requirements--as a matter of Massachusetts law--            qualify   the  statutory  priority.     Plaintiffs  have  not            challenged this ruling on appeal.                 The plaintiffs  might have  argued  that the  limitation            adopted  here is  not  itself  a  "requirement"  of  "federal            legislation  or  regulations"  but   is  merely  a  developer            proposal that HUD  has chosen to bless.  Possibly, plaintiffs            thought that this arguable distinction did not matter because            a  federal administrative  measure, even  if  not statute  or            regulation,  might  override  state   legislation  under  the            Supremacy Clause--assuming always  that it was  an authorized            measure.  This  is by no  means clear, but arguments  on this            point have not been made and need not be pursued.                  In the district court, it appears that plaintiffs' trust            argument may have been advanced  primarily as an adjunct to a            different  constitutional claim, namely a claim that the plan            in  question impaired a property interest without due process                                         -18-                                         -18-            or  just compensation.   The alleged trust,  in this context,            would be a way of expressing a claimed property interest.  It            is not obvious why a trust interest would be more entitled to            this status than section 49's simple expression of a priority            in favor of former tenants.                 In all events, whether called a trust or something else,            any  property interest created  by section 49(c)  is arguably            subject to section  49's own explicit reservation  in section            49(d).  As already noted,  the plaintiffs on this appeal have            not  challenged the district court ruling that subsection (d)            qualifies subsection (c) and also embraces the disputed plan.            Taking  these  district court  rulings  as unchallenged,  the            trust  argument adds  nothing to  the  due process  argument,            which  itself has not itself been  renewed in the plaintiffs'            briefs in this court.                 This  is a case  that stirs conflicting  sympathies, for            those  ousted  from  their West  End  neighborhood  by "urban            renewal" many years ago  no less than for  minorities wrongly            denied fair  housing opportunities  in Boston.   But we  have            properly  sought to  decide this  appeal  based upon  Supreme            Court precedent, as best we can discern it, recognizing  that            the  case  is a  difficult  and unusual  one on  the  edge of            developing law.               Affirmed.                                          ________                                                    Dissent follows.                                                    _______________                                         -19-                                         -19-                      Stahl, Circuit Judge, dissenting in part.  There is                      Stahl, Circuit Judge, dissenting in part.                               _____________            for  me considerable appeal  in the majority's  resolution of            plaintiffs'  equal  protection  claims.     The  governmental            conduct these claims challenge involves a patently good faith            and facially reasonable  effort to accommodate  the competing            interests  of two historic  losers in Boston's  housing wars:            the  racial  and  ethnic minorities  entitled  to  invoke the            protections  of  the  consent decree  in  NAACP  v.  Kemp and                                                      _____      ____            federal fair housing  laws, and  the former  West Enders,  an            ethnically  diverse, lower middle  class group which,  in the            name of "urban renewal," was forced from its neighborhood and            could not afford to return.                       Nonetheless,  I cannot  join  the  portion  of  the            majority opinion that affirms the district court's pleadings-            based  dismissal of  the equal  protection claims.    While I            agree with the  majority that  reverse discrimination  claims            like the  present one  are "on the  edge of  developing law,"            ante at 19, I do  think it settled that, when  the government            ____            withdraws  benefits from a  class of citizens  because of the            race  or ethnicity  of the  class, courts  are to  scrutinize            strictly  the government's  conduct so as  to ensure  that it            furthers a  compelling governmental interest and  is narrowly            tailored to advance that interest.  See Adarand Constructors,                                                ___ _____________________            Inc. v. Pena, 515  U.S. 200, 226-227 (1995).  For the reasons            ____    ____            that follow,  I believe plaintiffs'  complaint fairly alleges                                         -20-                                         -20-            such a withdrawal of benefits.  And I do not  see how we can,            at  this  stage  of  the litigation,  conclude  that  such  a            withdrawal of benefits passes strict scrutiny.                            The   complaint  alleges   that  the   governmental            defendants  curtailed  plaintiffs'  statutory  preference  in            order to  comply with  the consent decree  in NAACP  v. Kemp.                                                          _____     ____            See ante at 11.   Because the purpose of that  consent decree            ___ ____            is  "the achievement of a racial composition, in HUD-assisted            housing  located  in  neighborhoods  which are  predominantly            white, which reflects  the racial composition of the  City of            Boston as a  whole," id. at 6,  a reasonable inference to  be                                 ___            drawn from plaintiffs' complaint, see Aybar v. Crispin-Reyes,                                              ___ _____    _____________            118 F.3d 10, 13 (1st Cir. 1997) (reasonable inferences are to            be drawn  in favor of  the party opposing  a Fed. R.  Civ. P.            12(b)(6)  motion), is  that  defendants  acted  as  they  did            because the putative plaintiff class was predominantly white.            The  fact that defendants  "do not dispute"  this accusation,            ante  at 11,  only  underscores  our  obligation  to  subject            ____            defendants' conduct to strict scrutiny, see Adarand, 515 U.S.                                                    ___ _______            at 224  ("[A]ny person,  of whatever race,  has the  right to            demand   that  any   governmental   actor   subject  to   the            Constitution  justify  any racial  classification  subjecting            that person to unequal treatment under the strictest judicial            scrutiny.").                                         -21-                                         -21-                      The  majority reaches  a contrary  conclusion--that            strict  scrutiny does not apply--because it regards the facts            plaintiffs  have pleaded in support of their equal protection            claims  insufficient to  describe a  "racial classification."            See  ante at  13-16 (holding  that this  case is  outside the            ___  ____            principle  of  Adarand).   In  reaching  its  conclusion, the                           _______            majority emphasizes  the effect of curtailing  the preference                                     ______            on  non-parties to  this litigation,  see ante at  13 ("[T]he                                                  ___ ____            apartments  freed  from  the  statutory preference  are  made            available  to all applicants  regardless of race."),  and the                          ___            defendants' intent in enacting the curtailment, see id. at 14                        ______                              ___ ___            ("It might  not seem  remarkable that  the government  should            insist .  . . that a fair number  of the apartments should be            effectively open to  application by tenants of  all races.").            The majority  also reads  the complaint  to allege only  that            defendants  acted as they did because plaintiffs are racially            identifiable; it does not  read the complaint to allege  that            defendants  acted as they  did because plaintiffs  are white.            Id. at 15.               ___                      Taking  this last  point first,  I  simply disagree            with the majority's reading of the complaint.  The  complaint            does not  allege that  the preference  was curtailed  because            plaintiffs  are  racially  monolithic;  it alleges  that  the            preference was curtailed because of the consent decree.  And,            as I have stated, because the consent decree operates only in                                         -22-                                         -22-            favor of racial  and ethnic minorities, it could  not be read            to require curtailment  of the preference if  the former West            Enders  were  predominantly  black.   Thus,  for  purposes of            evaluating  defendants' Rule  12(b)(6)  motion, I  believe we            must  read into  the complaint  the  allegation the  majority            believes  necessary to trigger  strict scrutiny, see  ante at                                                             ___  ____            16:  that defendants would not have acted as they did had the            plaintiff class  been predominantly of color.  See Aybar, 118                                                           ___ _____            F.3d at 13;  see also Conley  v. Gibson, 355  U.S. 41,  47-48                         ___ ____ ______     ______            (1957) (Fed. R. Civ. P.  8(a)(2) does not require a complaint            to  set  forth  specific  facts   in  support  of  a  general            allegation of discrimination).                      Even  if the  majority has  properly  construed the            complaint, I believe plaintiffs'  equal protection claims are            sufficient to withstand a Rule 12(b)(6) motion and to trigger            strict scrutiny.   In  the redistricting  cases, the  Supreme            Court   has   emphasized   that   government   action   which            subordinates  race  neutral considerations  to  an overriding            racial purpose is  constitutionally suspect:   "We recognized            in  Shaw[v. Reno,  509  U.S. 630  (1993)]  that, outside  the                ____    ____            districting context, statutes are  subject to strict scrutiny            under the Equal Protection Clause  not just when they contain            express racial classifications,  but also  when, though  race            neutral on their face, they are motivated by a racial purpose            or  object."   Miller v.  Johnson, 515  U.S. 900,  913 (1995)                           ______     _______                                         -23-                                         -23-            (affirming   the   invalidation,   under   equal   protection            principles,  of a  Georgia  congressional redistricting  plan            designed to increase  the number of majority  black districts            in  Georgia)  (citation omitted).    It  remains to  be  seen            whether  the Court  will  press this  principle to  its outer            limit  and  strictly  scrutinize  even  governmental  conduct            which, though  predominantly motivated  by a  racial purpose,            would not appear  to burden any person because of  his or her            race--e.g., a public university's efforts at recruiting fully                  ____            qualified applicants of  color for its first year  law school            class.    But it  seems  apparent  that defendants'  lack  of            hostility towards whites in particular, cf. ante at 13,  does                                                    ___ ____            not  shield  their  conduct--which  has  burdened  plaintiffs            because they are, as a group, racially identifiable--from the            most searching  judicial inquiry.   See  Miller, 515 U.S.  at                                                ___  ______            913.                          This leads to a final point.  I            think the majority runs afoul of Adarand in concentrating its                                             _______            focus so heavily on both defendants' intent and the effect of            defendants' actions on non-parties to this case.  The Supreme            Court has squarely rejected the argument that classifications            motivated   by   "benign"   considerations   should  not   be            scrutinized strictly.   See  Adarand, 515 U.S.  at 226.   And                                    ___  _______            though this  case does appear  unique in that  the government            conduct at  issue is more  a withdrawal of a  special benefit            from whites than  a giving of special benefits  to members of                                         -24-                                         -24-            minority groups,9 the  clear import of Adarand is  that it is                                                   _______            the  plaintiff's "personal right  to equal protection  of the                              ________            laws," 515 U.S. at 227,  and not some non-party's interest in            competing for that which would be the plaintiff's but for his            or her race, that is constitutionally safeguarded.   Thus, in            evaluating the constitutionality  of defendants' conduct,  we            must not  look to its  effect and motivation with  respect to            others;  we  must  look at  its  effect  and  motivation with            respect  to plaintiffs.  And here, quite clearly, defendants'            conduct has  had  the effect  of  depriving plaintiffs  of  a            benefit  and was  prompted by  the fact  that plaintiffs  are            mostly white.                         Because  defendants'   conduct  should   have  been            strictly  scrutinized, their  motion  to dismiss  plaintiffs'            equal  protection  claim  should have  been  denied  and they            should  have been  required to  produce  evidence that  their            conduct  was  narrowly  tailored  to  advance   a  compelling            governmental   interest.    See  Adarand,  515  U.S.  at  227                                        ___  _______            (reciting the components of the strict scrutiny inquiry); see                                                                      ___            also Aiken  v. City of Memphis, 37  F.3d 1155, 1163 (6th cir.            ____ _____     _______________            1994) ("When, as  here, a race-based affirmative  action plan            is subjected to strict scrutiny, the party defending the plan                                            ____________________            9It is important to note that there is no indication that the            benefit  originally  given (i.e.,  the  full  preference) was            given to  plaintiffs because  they were predominantly  white;            rather, the  preference  was given  because  plaintiffs  were            ousted from their homes.                                         -25-                                         -25-            bears the  burden  of producing  evidence  that the  plan  is            constitutional.").  Plaintiffs  should then have been  put to            the burden of proving the unconstitutionality  of defendants'            conduct.  See Aiken, 37  F.3d at 1162 ("The party challenging                      ___ _____            [a racially-preferential] plan retains the ultimate burden of            proving its unconstitutionality.").   To the extent  that the            majority  has   reached  a   different  conclusion,   I  most            respectfully dissent.                                          -26-                                         -26-
