Domino's Pizza, Inc. v. McDonald

Domino's Pizza, Inc. v. McDonald is a significant case in United States corporate law, decided by the Supreme Court of the United States on May 23, 2006. The case addressed important issues regarding the application of Section 1981 of the Civil Rights Act of 1866, focusing on the rights of parties to make and enforce contracts without racial discrimination. This landmark decision has implications for corporate entities, contract law, and civil rights protections in the United States.

Background

The dispute originated when John McDonald, an African American entrepreneur, entered into contracts with Domino's Pizza to provide construction services through his company. McDonald alleged that Domino's Pizza terminated these contracts on a racially discriminatory basis, violating Section 1981 of the Civil Rights Act of 1866, which guarantees all persons within the jurisdiction of the United States the same right to make and enforce contracts as is enjoyed by white citizens.

Case History

John McDonald filed a lawsuit against Domino's Pizza, claiming racial discrimination under Section 1981. The case moved through the lower courts, with varying outcomes regarding the applicability of Section 1981 to the circumstances of the case. The central legal question was whether McDonald, as a sole shareholder of a corporation, could sue for racial discrimination under Section 1981, even though the contracts were between Domino's and the corporation, not McDonald personally.

Supreme Court Decision

The Supreme Court, in a unanimous decision, ruled in favor of Domino's Pizza. The Court held that because the alleged discrimination was against the corporation, and not McDonald personally, he could not claim a violation of Section 1981. The Court reasoned that a corporation, being a distinct legal entity from its shareholders, cannot experience racial discrimination in a manner that Section 1981 protects. Therefore, McDonald, as an individual, did not have standing to sue under this statute for alleged discrimination against his corporation.

Implications

The decision in Domino's Pizza, Inc. v. McDonald has significant implications for corporate law, civil rights litigation, and the protections afforded to minority business owners under Section 1981. It clarified the limitations of Section 1981 in protecting against racial discrimination in contractual relationships, particularly in the context of corporate entities. This case underscores the importance of understanding the legal distinction between individuals and corporations for the purposes of civil rights protections.

See Also

• Civil Rights Act of 1866
• Corporate law
• Supreme Court of the United States
• Contract law