author: Justice Blackmun CHIEF Justice Rehnquist, Justice Thomas, Justice O’Connor, Justice Scalia,

text:
    GEORGIA v. McCOLLUM et al.
    No. 91-372.
    Argued February 26, 1992
    Decided June 18, 1992

      Blackmun, J., delivered the opinion of the Court, in which Rehnquist, C. J., and White, Stevens, Kennedy, and Soutek, JJ., joined. Rehnquist, C. J., filed a concurring opinion, post, p. 69. Thomas, J., filed an opinion concurring in the judgment, post, p. 60. O’Connor, J., post, p. 62, and Scalía, J., post, p. 69, filed dissenting opinions.

      Harrison W. Kohler, Senior Assistant Attorney General of Georgia, argued the cause for petitioner. With him on. the briefs were Michael J. Bowers, Attorney General, and Charles M. Richards, Senior Assistant Attorney General.

      Michael R. Dreeben argued the cause for the United States as amicus curiae urging reversal. With him on the brief were Solicitor General Starr, Assistant Attorney General Mueller, and Deputy Solicitor General Bryson.

      Robert H. Revell, Jr., argued the cause for respondents. With him on the brief was Jesse W. Walters

      Briefs of amici curiae urging reversal were filed for the Criminal Justice Legal Foundation by Kent Scheidegger and Charles L. Hobson; and for the NAACP Legal Defense and Educational Fund, Inc., by Julius L. Chambers, Charles Stephen Ralston, and Eric Schnapper.

      Briefs of amici curiae were filed for the National Association of Criminal Defense Lawyers by Judy Clarke and Mario G. Conte; and for Charles J. Hynes, pro se, by Jay M. Cohen, Matthew S. Greenberg, Victor Barall, and Carol Teague Schwartzkopf.

   Justice Blackmun

delivered the opinion of the Court.

For more than a century, this Court consistently and repeatedly has reaffirmed that racial discrimination by the State in jury selection offends the Equal Protection Clause. See, e. g., Strauder v. West Virginia, 100 U. S. 303 (1880). Last Term this Court held that racial discrimination in a civil litigant’s exercise of peremptory challenges also violates the Equal Protection Clause. See Edmonson v. Leesville Concrete Co., 500 U. S. 614 (1991). Today, we are asked to decide whether the Constitution prohibits a criminal defendant from engaging in purposeful racial discrimination in the exercise of peremptory challenges.

b-i

On August 10, 1990, a grand jury sitting in Dougherty County, Ga., returned a six-count indictment charging respondents with aggravated assault and simple battery. See App. 2. The indictment alleged that respondents beat and assaulted Jerry and Myra Collins. Respondents are white; the alleged victims are African-Americans. Shortly after the events, a leaflet was widely distributed in the local African-American community reporting the assault and urging community residents not to patronize respondents’ business.

Before jury selection began, the prosecution moved to prohibit respondents from exercising peremptory challenges in a racially discriminatory manner. The State explained that it expected to show that the victims’ race was a factor in the alleged assault. According to the State, counsel for respondents had indicated a clear intention to use peremptory strikes in a racially discriminatory manner, arguing that the circumstances of their case gave them the right to exclude African-American citizens from participating as jurors in the trial. Observing that 43 percent of the county’s population is African-American, the State contended that, if a statistically representative panel is assembled for jury selection, 18 of the potential 42 jurors would be African-American. With 20 peremptory challenges, respondents therefore would be able to remove all the African-American potential jurors. Relying on Batson v. Kentucky, 476 U. S. 79 (1986), the Sixth Amendment, and the Georgia Constitution, the State sought ' an order providing that, if it succeeded in making out a prima facie case of racial discrimination by respondents, the latter would be required to articulate a racially neutral explanation for peremptory challenges.

The trial judge denied the State’s motion, holding that “[njeither Georgia nor federal law prohibits criminal defendants from exercising peremptory strikes in a racially discriminatory manner.” App. 14. The issue was certified for immediate appeal. Id., at 15 and 18.

The Supreme Court of Georgia, by a 4-to-3 vote, affirmed the trial court’s ruling. 261 Ga. 473,405 S. E. 2d 688 (1991). The court acknowledged that in Edmonson v. Leesville Concrete Co., 500 U. S. 614 (1991), this Court had found that the exercise of a peremptory challenge in a racially discriminatory manner “would constitute an impermissible injury” to the excluded juror. 261 Ga., at 473, 405 S. E. 2d, at 689. The court noted, however, that Edmonson involved private civil litigants, not criminal defendants. “Bearing in mind the long history of jury trials as an essential element of the protection of human rights,” the court “decline[d] to diminish the free exercise of peremptory strikes by a criminal defendant.” 261 Ga., at 473, 405 S. E. 2d, at 689. Three justices dissented, arguing that Edmonson and other decisions of this Court establish that racially based peremptory challenges by a criminal defendant violate the Constitution. 261 Ga., at 473, 405 S. E. 2d, at 689 (Hunt, J.); id., at 475, 405 S. E. 2d, at 690 (Benham, J.); id., at 479, 405 S. E. 2d, at 693 (Fletcher, J.). A motion for reconsideration was denied. App. 60.

We granted certiorari to resolve a question left open by our prior cases — whether the Constitution prohibits a criminal defendant from engaging in purposeful racial discrimination in the exercise of peremptory challenges. 502 U. S. 937 (1991).

II

Over the last century, in an almost unbroken chain of decisions, this Court gradually has abolished race as a consideration for jury service. In Strauder v. West Virginia, 100 U. S. 303 (1880), the Court invalidated a state statute providing that only white men could serve as jurors. While stating that a defendant has no right to a “petit jury composed in whole or in part of persons of his own race,” id., at 305, the Court held that a defendant does have the right to be tried by a jury whose members are selected by nondiscriminatory criteria. See also Neal v. Delaware, 103 U. S. 370, 397 (1881); Norris v. Alabama, 294 U. S. 587, 599 (1935) (State cannot exclude African-Americans from jury venire on false assumption that they, as a group, are not qualified to serve as jurors).

In Swain v. Alabama, 380 U. S. 202 (1965), the Court was confronted with the question whether an African-American defendant was denied equal protection by the State’s exercise of peremptory challenges to exclude members of his race from the petit jury. Id., at 209-210. Although the Court rejected the defendant’s attempt to establish an equal protection claim premised solely on the pattern of jury strikes in his own case, it acknowledged that proof of systematic exclusion of African-Americans through the use of perempto-ries over a period of time might establish such a violation. Id., at 224-228.

In Batson v. Kentucky, 476 U. S. 79 (1986), the Court discarded Swain’s evidentiary formulation. The Batson Court held that a defendant may establish a prima facie case of purposeful discrimination in selection of the petit jury based solely on the prosecutor’s exercise of peremptory challenges at the defendant’s trial. Id., at 87. “Once the defendant makes a prima facie showing, the burden shifts to the State to eome forward with a neutral explanation for challenging black jurors.” Id., at 97.

Last Term this Court applied the Batson framework in two other contexts. In Powers v. Ohio, 499 U. S. 400 (1991), it held that in the trial of a white criminal defendant, a prosecutor is prohibited from excluding African-American jurors on the basis of race. In Edmonson v. Leesville Concrete Co., 500 U. S. 614 (1991), the Court decided that in a civil case, private litigants cannot exercise their peremptory strikes in a racially discriminatory manner.

In deciding whether the Constitution prohibits criminal defendants from exercising racially discriminatory peremptory challenges, we must answer four questions. First, whether a criminal defendant’s exercise of peremptory challenges in a racially discriminatory manner inflicts the harms addressed by Batson. Second, whether the exercise of peremptory challenges by a criminal defendant constitutes state action. Third, whether prosecutors have standing to raise this constitutional challenge. And fourth, whether the constitutional rights of a criminal defendant nonetheless preclude the extension of our precedents to this case.

Ill

A

The majority in Powers recognized that “Batson ‘was designed “to serve multiple ends,” ’ only one of which was to protect individual defendants from discrimination in the selection of jurors.” 499 U. S., at 406. As in Powers and Edmonson, the extension of Batson in this context is designed to remedy the harm done to the “dignity of persons” and to the “integrity of the courts.” Powers, 499 U. S., at 402.

As long ago as Strauder, this Court recognized that denying a person participation in jury service on account of his race unconstitutionally discriminates against the excluded juror. 100 U. S., at 308. See also Batson, 476 U. S., at 87. While “[a]n individual juror does not have a right to sit on any particular petit jury,... he or she does possess the right not to be excluded from one on account of race.” Powers, 499 U. S., at 409. Regardless of who invokes the discriminatory challenge, there can be no doubt that the harm is the same — in all eases, the juror is subjected to open and public racial discrimination.

But “[t]he harm from discriminatory jury selection extends beyond that inflicted on the defendant and the excluded juror to touch the entire community.” Batson, 476 U. S., at 87. One of the goals of our jury system is “to impress upon the criminal defendant and the community as a whole that a verdict of conviction or acquittal is given in accordance with the law by persons who are fair.” Powers, 499 U. S., at 413. Selection procedures that purposefully exclude African-Americans from juries undermine that public confidence — as well they should. “The overt wrong, often apparent to the entire jury panel, casts doubt over the obligation of the parties, the jury, and indeed the court to adhere to the law throughout the trial of the cause.” Id., at 412. See generally Underwood, Ending Race Discrimination in Jury Selection: Whose Right Is It, Anyway?, 92 Colum. L. Rev. 725, 748-750 (1992).

The need for public confidence is especially high in cases involving race-related crimes. In such cases, emotions in the affected community will inevitably be heated and volatile. Public confidence in the integrity of the criminal justice system is essential for preserving community peace in trials involving race-related crimes. See Alschuler, The Supreme Court and the Jury: Voir Dire, Peremptory Challenges, and the Review of Jury Verdicts, 56 U. Chi. L. Rev. 153, 195-196 (1989) (describing two trials in Miami, Fla., in which all African-American jurors were peremptorily struck by white defendants accused of racial beating, and the public outrage and riots that followed the defendants’ acquittal).

“[B]e it at the hands of the State or the defense,” if a court allows jurors to be excluded because of group bias, “[it] is [a] willing participant in a scheme that could only undermine the very foundation of our system of justice — our citizens’ confidence in it.” State v. Alvarado, 221 N. J. Super. 324, 328, 534 A. 2d 440, 442 (1987). Just as public confidence in criminal justice is undermined by a conviction in a trial where racial discrimination has occurred in jury selection, so is public confidence undermined where a defendant, assisted by racially discriminatory peremptory strikes, obtains an acquittal.

B

The fact that a defendant’s use of discriminatory peremptory challenges harms the jurors and the community does not end our equal protection inquiry. Racial discrimination, although repugnant in all contexts, violates the Constitution only when it is attributable to state action. See Moose Lodge No. 107 v. Irvis, 407 U. S. 163, 172 (1972). Thus, the second question that must be answered is whether a criminal defendant’s exercise of a peremptory challenge constitutes state action for purposes of the Equal Protection Clause.

Until Edmonson, the cases decided by this Court that presented the problem of racially discriminatory peremptory challenges involved assertions of discrimination by a prosecutor, a quintessential state actor. In Edmonson, by contrast, the contested peremptory challenges were exercised by a private defendant in a civil action. In order to determine whether state action was present in that setting, the Court in Edmonson used the analytical framework summarized in Lugar v. Edmondson Oil Co., 457 U. S. 922 (1982).

The first inquiry is “whether the claimed [constitutional] deprivation has resulted from the exercise of a right or privilege having its source in state authority.” Id., at 939. “There can be no question” that peremptory challenges satisfy this first requirement, as they “are permitted only when the government, by statute or decisional law, deems it appropriate to allow parties to exclude a given number of persons who otherwise would satisfy the requirements for service on the petit jury.” Edmonson, 500 U. S., at 620. As in Edmonson, a Georgia defendant's right to exercise peremptory challenges and the scope of that right are established by a provision of state law. Ga. Code Ann. §15-12-165 (1990).

The second inquiry is whether the private party charged with the deprivation can be described as a state actor. See Lugar, 457 U. S., at 941-942. In resolving that issue, the Court in Edmonson found it useful to apply three principles: (1) “the extent to which the actor relies on governmental assistance and benefits”; (2) “whether the actor is performing a traditional governmental function”; and (3) “whether the injury caused is aggravated in a unique way by the incidents of governmental authority.” 500 U. S., at 621-622.

As to the first principle, the Edmonson Court found that the peremptory challenge system, as well as the jury system as a whole, “simply could not exist” without the “overt, significant participation of the government.” Id., at 622. Georgia provides for the compilation of jury lists by the board of jury commissioners in each county and establishes the general criteria for service and the sources for creating a pool of qualified jurors representing a fair cross section of the community. Ga. Code Ann. § 15-12-40. State law further provides that jurors are to be selected by a specified process, § 15-12-42; they are to be summoned to court under the authority of the State, § 15-12-120; and they are to be paid an expense allowance by the State whether or not they serve on a jury, § 15-12-9. At court, potential jurors are placed in panels in order to facilitate examination by counsel, § 15-12-131; they are administered an oath, § 15-12-132; they are questioned on voir dire to determine whether they are impartial, § 15-12-164; and they are subject to challenge for cause, § 15-12-163.

In light of these procedures, the defendant in a Georgia criminal case relies on “governmental assistance and benefits” that are equivalent to those found in the civil context in Edmonson. “By enforcing a discriminatory peremptory challenge, the Court ‘has . . . elected to' place its power, property and prestige behind the [alleged] discrimination/” Edmonson, 500 U. S., at 624 (citation omitted).

In regard to the second principle, the Court in Edmonson found that peremptory challenges, perform a traditional function of the government: “Their sole purpose is to permit litigants to assist the government in the selection of an impartial trier of fact.” Id., at 620. And, as the Edmonson Court recognized, the jury system in turn “performs the critical governmental functions of guarding the rights of litigants and ‘ensur[ing] continued acceptance of the laws by all of the people’” id, at 624 (citation omitted). These same conclusions apply with even greater force in the criminal context because the selection of a jury in a criminal case fulfills a unique and constitutionally compelled governmental function. Compare Duncan v. Louisiana, 391 U. S. 145 (1968) (making Sixth Amendment applicable to States through Fourteenth Amendment), with Minneapolis & St. Louis R. Co. v. Bombolis, 241 U. S. 211 (1916) (States do not have a constitutional obligation to provide a jury trial in civil eases). Cf. West v. Atkins, 487 U. S. 42, 53, n. 10, 57 (1988) (private physician hired by State to provide medical care to prisoners was state actor because doctor was hired to fulfill State's constitutional obligation to attend to necessary medical care of prison inmates). The State cannot avoid its constitutional responsibilities by delegating a public function to private parties. Cf. Terry v. Adams, 345 U. S. 461 (1953) (private political party’s determination of qualifications for primary voters held to constitute state action).

Finally, the Edmonson Court indicated that the courtroom setting in which the peremptory challenge is exercised intensifies the harmful effects of the private litigant’s discriminatory act and contributes to its characterization as state action. These concerns are equally present in the context of a criminal trial. Regardless of who precipitated the jurors’ removal, the perception and the reality in a criminal trial will be that the court has excused jurors based on race, an outcome that will be attributed to the State.

Respondents nonetheless contend that the adversarial relationship between the defendant and the prosecution negates the governmental character of the peremptory challenge. Respondents rely on Polk County v. Dodson, 454 U. S. 312 (1981), in which a defendant sued, under 42 U. S. C. § 1983, the public defender who represented him. The defendant claimed that the public defender had violated his constitutional rights in failing to provide adequate representation. This Court determined that a public defender does not qualify as a state actor when engaged in his general representation of a criminal defendant.

Polk County did not hold that the adversarial relationship of a public defender with the State precludes a finding of state action — it held that this adversarial relationship prevented the attorney’s public employment from alone being sufficient to support a finding of state action. Instead, the determination whether a public defender is a state actor for a particular purpose depends on the nature and context of the function he is performing. For example, in Branti v. Finkel, 445 U. S. 507 (1980), this Court held that a public defender, in making personnel decisions on behalf of the State, is a state actor who must comply with constitutional requirements. And the Polk County Court itself noted, without deciding, that a public defender may act under color of state law while performing certain administrative, and possibly investigative, functions. See 454 U. S., at 325.

The exercise of a peremptory challenge differs significantly from other actions taken in support of a defendant’s defense. In exercising a peremptory challenge, a criminal defendant is wielding the power to choose a quintessential governmental body — indeed, the institution of government on which our judicial system depends. Thus, as we held in Edmonson, when “a government confers on a private body the power to choose the government’s employees or officials, the private body will be bound by the constitutional mandate of race neutrality.” 500 U. S., at 625.

Lastly, the fact that a defendant exercises a peremptory challenge to further his interest in acquittal does not conflict with a finding of state action. Whenever a private actor’s conduct is deemed “fairly attributable” to the government, it is likely that private motives will have animated the actor’s decision. Indeed, in Edmonson, the Court recognized that the private party’s exercise of peremptory challenges constituted state action, even though the motive underlying the exercise of the peremptory challenge may be to protect a private interest. See id., at 626.

C

Having held that a defendant’s discriminatory exercise of a peremptory challenge is a violation of equal protection, we move to the question whether the State has standing to challenge a defendant’s discriminatory use of peremptory challenges. In Powers, 499 U. S., at 416, this Court held that a white criminal defendant has standing to raise the equal protection rights of black jurors wrongfully excluded from jury service. While third-party standing is a limited exception, the Powers Court recognized that a litigant may raise a claim on behalf of a third party if the litigant can demonstrate that he has suffered a concrete injury, that he has a close relation to the third party, and that there exists some hindrance to the third party’s ability to protect its own interests. Id., at 411. In Edmonson, the Court applied the same analysis in deciding that civil litigants had standing to raise the equal protection rights of jurors excluded on the basis of their race.

In applying the first prong of its standing analysis, the Powers Court found that a criminal defendant suffered cognizable injury “because racial discrimination in the selection of jurors ‘casts doubt on the integrity of the judicial process/ and places the fairness of a criminal proceeding in doubt.” 499 U. S., at 411 (citation omitted). In Edmonson, this Court found that these harms were not limited to the criminal sphere. 500 U. S., at 6B0. Surely, a State suffers a similar injury when the fairness and integrity of its own judicial process is undermined.

In applying the second prong of its standing analysis, the Powers Court held that voir dire permits a defendant to “establish a relation, if not a bond of trust, with the jurors,” a relation that “continues throughout the entire trial.” 499 U. S., at 413. “Exclusion of a juror on the basis of race severs that relation in an invidious way.” Edmonson, 500 U. S., at 629.

The State’s relation to potential jurors in this case is closer than the relationships approved in Powers and Edmonson. As the representative of all its citizens, the State is the logical and proper party to assert the invasion of the constitutional rights of the excluded jurors in a criminal trial. Indeed, the Fourteenth Amendment forbids the State to deny persons within its jurisdiction the equal protection of the laws.

In applying the final prong of its standing analysis, the Powers Court recognized that, although individuals excluded from jury service on the basis of race have a right to bring suit on their own behalf, the “barriers to a suit by an excluded juror are daunting.” 499 U. S., at 414. See also Edmonson, 500 U. S., at 629. The barriers are no less formidable in this context. See Note, Discrimination by the Defense: Peremptory Challenges after Batson v. Kentucky, 88 Colum. L. Rev. 355, 367 (1988); Underwood, 92 Colum. L. Rev., at 757 (summarizing barriers to suit by excluded juror). Accordingly, we hold that the State has standing to assert the excluded jurors’ rights.

D

The final question is whether the interests served by Bat-son must give way to the rights of a criminal defendant. As a preliminary matter, it is important to recall that peremptory challenges are not constitutionally protected fundamental rights; rather, they are but one state-created means to the constitutional end of an impartial jury and a fair trial. This Court repeatedly has stated that the right to a peremptory challenge may be withheld altogether without impairing the constitutional guarantee of an impartial jury and a fair trial. See Frazier v. United States, 335 U. S. 497, 505, n. 11 (1948); United States v. Wood, 299 U. S. 123, 145 (1936); Stilson v. United States, 250 U. S. 583, 586 (1919); see also Swain, 380 U. S., at 219.

Yet in Swain, the Court reviewed the “very old credentials,” id., at 212, of the peremptory challenge and noted the “long and widely held belief that the peremptory challenge is a necessary part of trial by jury,” id., at 219; see id., at 212-219. This Court likewise has recognized that “the role of litigants in determining the jury’s composition provides one reason for wide acceptance of the jury system and of its verdicts.” Edmonson, 500 U. S., at 630.

We do not believe that this decision will undermine the contribution of the peremptory challenge to the administration of justice. Nonetheless, “if race stereotypes are the price for acceptance of a jury panel as fair,” we reaffirm today that such a “price is too high to meet the standard of the Constitution.” Id., at 630. Defense counsel is limited to “legitimate, lawful conduct.” Nix v. Whiteside, 475 U. S. 157, 166 (1986) (defense counsel does not render ineffective assistance when he informs his client that he would disclose the client’s perjury to the court and move to withdraw from representation). It is an affront to justice to argue that a fair trial includes the right to discriminate against a group of citizens based upon their race.

Nor does a prohibition of the exercise of discriminatory peremptory challenges violate a defendant’s Sixth Amendment right to the effective assistance of counsel. Counsel can ordinarily explain the reasons for peremptory challenges without revealing anything about trial strategy or any confidential client communications. In the rare case in which the explanation for a challenge would entail confidential communications or reveal trial strategy, an in camera discussion can be arranged. See United States v. Zolin, 491 U. S. 554 (1989); cf. Batson, 476 U. S., at 97 (expressing confidence that trial judges can develop procedures to implement the Court’s holding). In any event, neither the Sixth Amendment right nor the attorney-client privilege gives a criminal defendant the right to carry out through counsel an unlawful course of conduct. See Nix, 475 U. S., at 166; Zolin, 491 U. S., at 562-563. See Swift, Defendants, Racism and the Peremptory Challenge, 22 Colum. Hum. Rights L. Rev. 177, 207-208 (1991).

Lastly, a prohibition of the discriminatory exercise of peremptory challenges does not violate a defendant’s Sixth Amendment right to a trial by an impartial jury. The goal of the Sixth Amendment is “jury impartiality with respect to both contestants.” Holland v. Illinois, 493 U. S. 474, 483 (1990). See also Hayes v. Missouri, 120 U. S. 68 (1887).

We recognize, of course, that a defendant has the right to an impartial jury that can view him without racial animus, which so long has distorted our system of criminal justice. We have, accordingly, held that there should be a mechanism for removing those on the venire whom the defendant has specific reason to believe would be incapable of confronting and suppressing their racism. See Ham v. South Carolina, 409 U. S. 524, 526-527 (1973); Rosales-Lopez v. United States, 451 U. S. 182, 189-190 (1981) (plurality opinion of White, J.). Cf. Morgan v. Illinois, 504 U. S. 719 (1992) (exclusion of juror in capital trial is permissible upon showing that juror is incapable of considering sentences other than death).

But there is a distinction between exercising a peremptory challenge to discriminate invidiously against jurors on account of race and exercising a peremptory challenge to remove an individual juror who harbors racial prejudice. This Court firmly has rejected the view that assumptions of partiality based on race provide a legitimate basis for disqualifying a person as an impartial juror. As this Court stated just last Term in Powers, “[w]e may not accept as a defense to racial discrimination the very stereotype the law condemns.” 499 U. S., at 410. “In our heterogeneous society policy as well as constitutional considerations militate against the divisive assumption — as a per se rule — that justice in a court of law may turn upon the pigmentation of skin, the accident of birth, or the choice of religion.” Ristaino v. Ross, 424 U. S. 589, 596, n. 8 (1976). We therefore reaffirm today that the exercise of a peremptory challenge must not be based on either the race of the juror or the racial stereotypes held by the party.

IV

We hold that the Constitution prohibits a criminal defendant from engaging in purposeful discrimination on the ground of race in the exercise of peremptory challenges. Accordingly, if the State demonstrates a prima facie case of racial discrimination by the defendants, the defendants must articulate a racially neutral explanation for peremptory challenges. The judgment of the Supreme Court of Georgia is reversed, and the ease is remanded for further proceedings not inconsistent with this opinion.

It is so ordered.

CHIEF Justice Rehnquist,

concurring.

I was in dissent in Edmonson v. Leesville Concrete Co., 500 U. S. 614 (1991), and continue to believe that case to have been wrongly decided. But so long as it remains the law, I believe that it controls the disposition of this case on the issue of "state action” under the Fourteenth Amendment. I therefore join the opinion of the Court.

Justice Thomas,

concurring in the judgment.

As a matter of first impression, I think that I would have shared the view of the dissenting opinions: A criminal defendant’s use of peremptory strikes cannot violate the Fourteenth Amendment because it does not involve state action. Yet, I agree with the Court and The CHIEF Justice that our decision last Term in Edmonson v. Leesville Concrete Co., 500 U. S. 614 (1991), governs this ease and requires the opposite conclusion. Because the respondents do not question Edmonson, I believe that we must accept its consequences. I therefore concur in the judgment reversing the Georgia Supreme Court.

I write separately to express my general dissatisfaction with our continuing attempts to use the Constitution to regulate peremptory challenges. See, e. g., Batson v. Kentucky, 476 U. S. 79 (1986); Powers v. Ohio, 499 U. S. 400 (1991); Ed-monson, supra. In my view, by restricting a criminal defendant’s use of such challenges, this case takes us further from the reasoning and the result of Strauder v. West Virginia, 100 U. S. 303 (1880). I doubt that this departure will produce favorable consequences. On the contrary, I am certain that black criminal defendants will rue the day that this Court ventured down this road that inexorably will lead to the elimination of peremptory strikes.

In Strauder, as the Court notes, we invalidated a state law that prohibited blacks from serving on juries. In the course of the decision, we observed that the racial composition of a jury may affect the outcome of a criminal ease. We explained: “It is well known that prejudices often exist against particular classes in the community, which sway the judgment of jurors, and which, therefore, operate in some cases to deny to persons of those classes the full enjoyment of that protection which others enjoy.” Id., at 309. We thus recognized, over a century ago, the precise point that Justice O’Connor makes today. Simply stated, securing representation of the defendant’s race on the jury may help to overcome racial bias and provide the defendant with a better chance of having a fair trial. Post, at 68-69.

I do not think that this basic premise of Stmuder has become obsolete. The public, in general, continues to believe that the makeup of juries can matter in certain instances. Consider, for example, how the press reports criminal trials. Major newspapers regularly note the number of whites and blacks that sit on juries in important cases. Their editors and readers apparently recognize that conscious and unconscious prejudice persists in our society and that it may influence some juries. Common experience and common sense confirm this understanding.

In Batson, however, this Court began to depart from Stmuder by holding that, without some actual showing, suppositions about the possibility that jurors may harbor prejudice have no legitimacy. We said, in particular, that a prosecutor could not justify peremptory strikes “by stating merely that he challenged jurors of the defendant’s race on the assumption — or his intuitive judgment — that they would be partial to the defendant because of their shared race.” 476 U. S., at 97. As noted, however, our decision in Stmuder rested on precisely such an “assumption” or “intuition.” We reasonably surmised, without direct evidence in any particular case, that all-white juries might judge black defendants unfairly.

Our departure from Stmuder has two negative consequences. First, it produces a serious misordering of our priorities. In Stmuder, we put the rights of defendants foremost. Today’s decision, while protecting jurors, leaves defendants with less means of protecting themselves. Unless jurors actually admit prejudice during voir dire, defendants generally must allow them to sit and run the risk that racial animus will affect the verdict. Cf. Fed. Rule Evid. 606(b) (generally excluding juror testimony after trial to impeach the verdict). In effect, we have exalted the right of citizens to sit on juries over the rights of the criminal defendant, even though it is the defendant, not the jurors, who faces imprisonment or even death. At a minimum, I think that this inversion of priorities should give us pause.

Second, our departure from Stmuder has taken us down a slope of inquiry that had no clear stopping point. Today, we decide only that white defendants may not strike black veniremen on the basis of race. Eventually, we will have to decide whether black defendants may strike white veniremen. See, e. g., State v. Carr, 261 Ga. 845, 413 S. E. 2d 192 (1992). Next will come the question whether defendants may exercise peremptories on the basis of sex. See, e. g., United States v. De Gross, 960 F. 2d 1433 (CA9 1992). The consequences for defendants of our decision and of these future cases remain to be seen.. But whatever the benefits were that this Court perceived in a criminal defendant’s having members of his class on the jury, see Strauder, 100 U. S., at 309-310, they have evaporated.

Justice O’Connor,

dissenting.

The Court reaches the remarkable conclusion that criminal defendants being prosecuted by the State act on behalf of their adversary when they exercise peremptory challenges during jury selection. The Court purports merely to follow precedents, but our eases do not compel this perverse result. To the contrary, our decisions specifically establish that criminal defendants and their lawyers are not government actors when they perform traditional trial functions.

I

It is well and properly settled that the Constitution’s equal protection guarantee forbids prosecutors to exercise peremptory challenges in a racially discriminatory fashion. See Batson v. Kentucky, 476 U. S. 79 (1986); Powers v. Ohio, 499 U. S. 400, 409 (1991). The Constitution, however, affords no similar protection against private action. “Embedded in our Fourteenth Amendment jurisprudence is a dichotomy between state action, which is subject to scrutiny under the Amendmen[t] . . . , and private conduct, against which the Amendment affords no shield, no matter how unfair that conduct may be.” National Collegiate Athletic Assn. v. Tarkanian, 488 U. S. 179, 191 (1988) (footnote omitted). This distinction appears on the face of the Fourteenth Amendment, which provides that “No State shall. . . deny to any person within its jurisdiction the equal protection of the laws.” U. S. Const., Arndt. 14, § 1 (emphasis added). The critical but straightforward question this case presents is whether criminal defendants and their lawyers, when exercising peremptory challenges as part of a defense, are state actors.

In Lugar v. Edmondson Oil Co., 457 U. S. 922 (1982), the Court developed a two-step approach to identifying state action in cases such as this. First, the Court will ask “whether the claimed deprivation has resulted from the exercise of a right or privilege having its source in state authority.” Id., at 939. Next, it will decide whether, on the particular facts at issue, the parties who allegedly caused the deprivation of a federal right can “appropriately” and “in all fairness” be characterized as state actors. Ibid.; Edmonson v. Leesville Concrete Co., 500 U. S. 614, 620 (1991). The Court’s determination in this case that the peremptory challenge is a creation of state authority, ante, at 51, breáis no new ground. See Edmonson, supra, at 620-621. But disposing of this threshold matter leaves the Court with the task of showing that criminal defendants who exercise pe-remptories should be deemed governmental actors. What our cases require, and what the Court neglects, is a realistic appraisal of the relationship between defendants and the government that has brought them to trial.

We discussed that relationship in Polk County v. Dodson, 454 U. S. 312 (1981), which held that a public defender does not act "under color of state law” for purposes of 42 U. S. C. § 1983 “when performing a lawyer’s traditional functions as counsel to a defendant in a criminal proceeding.” 454 U. S., at 325. We began our analysis by explaining that a public . defender’s obligations toward her client are no different than the obligations of any other defense attorney. Id., at 318. These obligations preclude attributing the acts of defense lawyers to the State: “[T]he duties of a defense lawyer are those of a personal counselor and advocate. It is often said that lawyers are ‘officers of the court.’ But the Courts of Appeals are agreed that a lawyer representing a client is not, by virtue of being an officer of the court, a state actor ....” Ibid.

We went on to stress the inconsistency between our adversarial system of justice and theories that would make defense lawyers state actors. “In our system,” we said, “a defense lawyer characteristically opposes the designated representatives of the State.” Ibid. This adversarial posture rests on the assumption that a defense lawyer best serves the public “not by acting on behalf of the State or in concert with it, but rather by advancing ‘the undivided interests of his client.’ ” Id., at 318-319 (quoting Ferri v. Ackerman, 444 U. S. 193, 204 (1979)). Moreover, we pointed out that the independence of defense attorneys from state control has a constitutional dimension. Gideon v. Wainwright, 372 U. S. 335 (1963), “established the right of state criminal defendants to the guiding hand of counsel at every step in the proceedings against [them].” 454 U. S., at 322 (internal quotation marks omitted). Implicit in this right “is the assumption that counsel will be free of state control. There can be no fair trial unless the accused receives the services of an effective and independent advocate.” Ibid. Thus, the defense’s freedom from state authority is not just empirically true, but is a constitutionally mandated attribute of our adversarial system.

Because this Court deems the “under color of state law” requirement that was not satisfied in Dodson identical to the Fourteenth Amendment’s state action requirement, see Lugar, supra, at 929, the holding of Dodson simply cannot be squared with today’s decision. In particular, Dodson cannot be explained away as a case concerned exclusively with the employment status of public defenders. See ante, at 54. The Dodson Court reasoned that public defenders performing traditional defense functions are not state actors because they occupy the same position as other defense attorneys in relevant respects. 454 U. S., at 319-325. This reasoning followed on the heels of a critical determination: Defending an accused “is essentially a private function,” not state action. Id., at 319. The Court’s refusal to acknowledge Dodson’s initial holding, on which the entire opinion turned, will not make that holding go away.

The Court also seeks to evade Dodson’s logic by spinning out a theory that defendants and their lawyers transmogrify from government adversaries into state actors when they exercise a peremptory challenge, and then change back to perform other defense functions. See ante, at 54. Dodson, however, established that even though public defenders might act under color of state law when carrying out administrative or investigative functions outside a courtroom, they are not vested with state authority “when performing a lawyer’s traditional functions as counsel to a defendant in a criminal proceeding.” 454 U. S., at 325. Since making peremptory challenges plainly qualifies as a “traditional function” of criminal defense lawyers, see Swain v. Alabama, 380 U. S. 202, 212-219 (1965); Lewis v. United States, 146 U. S. 370, 376 (1892), Dodson forecloses the Court’s functional analysis.

Even aside from our prior rejection of it, the Court’s functional theory fails. “[A] State normally can be held responsible for a private decision only when it has exercised coercive power or has provided such significant encouragement ... that the choice must in law be deemed to be that of the State.” Blum v. Yaretsky, 457 U. S. 991, 1004 (1982). Thus, a private party’s exercise of choice allowed by state law does not amount to state action for purposes of the Fourteenth Amendment so long as “the initiative comes from [the private party] and not from the State.” Jackson v. Metropolitan Edison Co., 419 U. S. 345, 357 (1974). See Flagg Bros., Inc. v. Brooks, 436 U. S. 149, 165 (1978) (State not responsible for a decision it “permits but does not compel”). The government in no way influences the defense’s decision to use a peremptory challenge to strike a particular juror. Our adversarial system of criminal justice and the traditions of the peremptory challenge vest the decision to strike a juror entirely with the accused. A defendant "may, if he chooses, peremptorily challenge ‘on his own dislike, without showing any cause;’ he may exercise that right without reason or for no reason, arbitrarily and capriciously.” Pointer v. United States, 151 U. S. 396, 408 (1894) (quoting 1 E. Coke, Institutes 156b (19th ed. 1832)). “The essential nature of the peremptory challenge is that it is one exercised without a reason stated, without inquiry and without being subject to the court’s control.” Swain, supra, at 220. See Dodson, supra, at 321-322; Lewis, supra, at 376, 378.

Certainly, Edmonson v. Leesville Concrete Co. did not render Dodson and its realistic approach to the state action inquiry dead letters. The Edmonson Court distinguished Dodson by saying: “In the ordinary context of civil litigation in which the government is not a party, an adversarial relation does not exist between the government and a private litigant. In the jury selection process, the government and private litigants work for the same end.” Edmonson, 500 U. S., at 627. While the nonpartisan administrative interests of the State and the partisan interests of private litigants may not be at odds during civil jury selection, the same cannot be said of the partisan interests of the State and the defendant during jury selection in a criminal trial. A private civil litigant opposes a private counterpart, but a criminal defendant is by design in an adversarial relationship with the government. Simply put, the defendant seeks to strike jurors predisposed to convict, while the State seeks to strike .jurors predisposed to acquit. The Edmonson Court clearly recognized this point when it limited the statement that “an adversarial relation does not exist between the government and a private litigant” to “the ordinary context of civil litigation in which the government is not a ‘party” Ibid, (emphasis added).

From arrest, to trial, to possible sentencing and punishment, the antagonistic relationship between government and the accused is clear for all to see. Rather than squarely facing this fact, the Court, as in Edmonson, rests its finding of governmental action on the points that defendants exercise peremptory challenges in a courtroom and judges alter the composition of the jury in response to defendants’ choices. I found this approach wanting in the context of civil controversies between private litigants, for reasons that need not be repeated here. See id., at 632 (O’Connor, J., dissenting). But even if I thought Edmonson was correctly decided, I could not accept today’s simplistic extension of it. Dodson makes clear that the unique relationship between criminal defendants and the State precludes attributing defendants’ actions to the State, whatever is the case in civil trials. How could it be otherwise when the underlying question is whether the accused “c[an] he described in all fairness as a state actor”? 500 U. S., at 620. As Dodson accords with our state action jurisprudence and with common sense, I would honor it.

II

What really seems to bother the Court is the prospect that leaving criminal defendants and their attorneys free to make racially motivated peremptory challenges will undermine the ideal of nondiseriminatory jury selection we espoused in Batson, 476 U. S., at 85-88. The concept that the government alone must honor constitutional dictates, however, is a fundamental tenet of our legal order, not an obstacle to be circumvented. This is particularly so in the context of criminal trials, where we have held the prosecution to uniquely high standards of conduct. See Brady v. Maryland, 373 U. S. 83 (1963) (disclosure of evidence favorable to the accused); Berger v. United States, 295 U. S. 78, 88 (1935) (“The [prosecutor] is the representative not of an ordinary party to a controversy, but of a sovereignty... whose interest... in a criminal prosecution is not that it shall win a ease, but that justice shall be done”).

Considered in purely pragmatic terms, moreover, the Court’s holding may fail to advance nondiseriminatory criminal justice. It is by now clear that conscious and unconscious racism can affect the way white jurors perceive minority defendants and the facts presented at their trials, perhaps determining the verdict of guilt or innocence. See Developments in the Law — Race and the Criminal Process, 101 Harv. L. Rev. 1472,1559-1560 (1988); Colbert, Challenging the Challenge: Thirteenth Amendment as a Prohibition against the Racial Use of Peremptory Challenges, 76 Cornell L. Rev. 1, 110-112 (1990). Using peremptory challenges to secure minority representation on the jury may help to overcome such racial bias, for there is substantial reason to believe that the distorting influence of race is minimized on a racially mixed jury. See id., at 112-115; Developments in the Law, supra, at 1559-1560. As amicus NAACP Legal Defense and Educational Fund explained in this case:

“The ability to use peremptory challenges to exclude majority race jurors may be crucial to empaneling a fair jury. In many cases an African American, or other minority defendant, may be faced with a jury array in which his racial group is underrepresented to some degree, but not sufficiently to permit challenge under the Fourteenth Amendment. The only possible chance the defendant may have of having any minority jurors on the jury that actually tries him will be if he uses his peremptories to strike members of the majority race.” Brief for NAACP Legal Defense and Educational Fund, Inc., as Amicus Curiae 9-10 (footnote omitted).

See Brief for National Association of Criminal Defense Lawyers as Amicus Curiae 56-57; Edmonson, supra, at 644 (Scalia, J., dissenting). In a world where the outcome of a minority defendant’s trial may turn on the misconceptions or biases of white jurors, there is cause to question the implications of this Court’s good intentions.

That the Constitution does not give federal judges the reach to wipe all marks of racism from every courtroom in the land is frustrating, to be sure. But such limitations are the necessary and intended consequence of the Fourteenth Amendment’s state action requirement. Because I cannot accept the Court’s conclusion that government is responsible for decisions criminal defendants make while fighting state prosecution, I respectfully dissent.

Justice Scalia,

dissenting.

I agree with the Court that its judgment follows logically from Edmonson v. Leesville Concrete Co., 500 U. S. 614 (1991). For the reasons given in the Edmonson dissents, however, I think that case was wrongly decided. Barely a year later, we witness its reduction to the terminally absurd:

A criminal defendant, in the process of defending himself against the state, is held to be acting on behalf of the state. Justice O’Connor demonstrates the sheer inanity of this proposition (in case the mere statement of it does not suffice), and the contrived nature of the Court’s justifications. I see no need to add to her discussion, and differ from her views only in that I do not consider Edmonson distinguishable in principle — except in the principle that a bad decision should not be followed logically to its illogical conclusion.

Today’s decision gives the lie once again to the belief that an activist, “evolutionary” constitutional jurisprudence always evolves in the direction of greater individual rights. In the interest of promoting the supposedly greater good of race relations in the society as a whole (make no mistake that that is what underlies all of this), we use the Constitution to destroy the ages-old right of criminal defendants to exercise peremptory challenges as they wish, to secure a jury that they consider fair. I dissent.

       Under Georgia law, the petit jury in a felony trial is selected from a panel of 42 persons. Ga. Code Ann. § 15-12-160 (1990).

       When a defendant is indicted for an offense carrying a penalty of four or more years, Georgia law provides that he may “peremptorily challenge 20 of the jurors impaneled to try him.” § 15-12-165.

       The Ninth Circuit recently has prohibited criminal defendants from exercising peremptory challenges on the basis of gender. United States v. De Gross, 960 F. 2d 1433 (1992) (en banc). Although the panel decision now has been vacated by the granting of rehearing en banc, a Fifth Circuit panel has held that criminal defendants may not exercise peremptory strikes in a racially discriminatory manner. See United States v. Greer, 939 F. 2d 1076, rehearing granted, 948 F. 2d 934 (1991).

         The Batson majority specifically reserved the issue before us today. 476 U. S., at 89, n. 12. The two Batson dissenters, however, argued that the “clear and inescapable import” was that Batson would similarly limit defendants. Id., at 125-126. Justice Marshall agreed, stating: “[0]ur criminal justice system ‘requires not only freedom from any bias against the accused, but also from any prejudice against his prosecution. Between him and the state the scales are to be evenly held.’ Hayes v. Missouri, 120 U. S. 68, 70 (1887).” Id., at 107 (concurring opinion).

       In his dissent in Edmonson, Justice Scalia stated that the effect of that decision logically must apply to defendants in criminal prosecutions. 500 U. S., at 644.

       The experience of many state jurisdictions has led to the recognition that a race-based peremptory challenge, regardless of who exercises it, harms not only the challenged juror, but the entire community. Acting pursuant to their state constitutions, state courts have ruled that criminal defendants have no greater license to violate the equal protection rights of prospective jurors than have prosecutors. See, e. g., State v. Levinson, 71 Haw. 492, 795 P. 2d 845 (1990); People v. Kern, 149 App. Div. 2d 187, 545 N. Y. S. 2d 4 (1989), aff'd, 75 N. Y. 2d 638, 555 N. Y. S. 2d 647 (1990); State v. Alvarado, 221 N. J. Super. 324, 534 A. 2d 440 (1987); State v. Neil, 457 So. 2d 481 (Fla. 1984); Commonwealth v. Soares, 377 Mass. 461, 387 N. E. 2d 499, cert. denied, 444 U. S. 881 (1979); People v. Wheeler, 22 Cal. 3d 258, 583 P. 2d 748 (1978).

       The Court in Lugar held that a private litigant is appropriately characterized as a state actor when he “jointly participates” with state officials in securing the seizure of property in which the private party claims to have rights. 457 U. S., at 932-933, 941-942.

       Indeed, it is common practice not to reveal the identity of the challenging party to the jurors and potential jurors, thus enhancing the perception that it is the court that has rejected them. See Underwood, Ending Race Discrimination in Jury Selection: Whose Right Is It, Anyway?, 92 Colum. L. Rev. 725, 751, n. 117 (1992).

       Although Polk County determined whether or not the public defender’s actions were under color of state law, as .opposed to whether or not they constituted state action, this Court subsequently has held that the two inquiries are the same, see, e. g., Rendell-Baker v. Kohn, 457 U. S. 830, 838 (1982), and has specifically extended Polk County's, reasoning to state-action cases, see Blum v. Yaretsky, 457 U. S. 991, 1009, n. 20 (1982).

       Numerous commentators similarly have concluded that a defendant’s exercise of peremptory challenges constitutes state action. See generally Alschuler, The Supreme Court and the Jury: Voir Dire, Peremptory Challenges, and the Review of Jury Verdicts, 56 U. Chi. L. Rev. 163,197-198 (1989); Note, State Action and the Peremptory Challenge: Evolution of the Court’s Treatment and Implications for Georgia v. McCollum, 67 Notre Dame L. Rev. 1049, 1061-1074 (1992); Note, Discrimination by the Defense: Peremptory Challeges after Batson v. Kentucky, 88 Colum. L. Rev. 355, 358-361 (1988); Comment, The Prosecutor’s Right to Object to a Defendant’s Abuse of Peremptory Challenges, 93 Dick. L. Rev. 143, 158-162 (1988); Tanford, Racism in the Adversary System: The Defendant’s Use of Peremptory Challenges, 63 S. Cal. L. Rev. 1015, 1027-1030 (1990); Underwood, 92 Colum. L. Rev., at 750-763.

      A computer search, for instance, reveals that the phrase “all white jury” has appeared over 200 times in the past five years in the New York Times, Chicago Tribune, and Los Angeles Times.

       The NAACP Legal Defense and Educational Fund, Inc., has submitted a brief arguing, in all sincerity, that “whether white defendants can use peremptory challenges to purge minority jurors presents quite different issues from whether a minority defendant can strike majority group jurors.” Brief for NAACP Legal Defense and Educational Fund, Inc., as Amicus Curiae 3-4. Although I suppose that this issue technically remains open, it is difficult to see how the result could be different if the defendants here were black.


source: Caselaw Access Project

author: Justice Stevens ChieF Justice Rehnquist,

license: Public Domain

text:
    KRAFT GENERAL FOODS, INC. v. IOWA DEPARTMENT OF REVENUE AND FINANCE
    No. 90-1918.
    Argued April 22, 1992
    Decided June 18, 1992

      Stevens, J., delivered the opinion of the Court, in which White, O’Con-nor, Scalia, Kennedy, Souter, and Thomas, JJ., joined. Rehnquist, C. J., filed a dissenting opinion, in which Blackmun, J., joined, post, p. 82.

      Jerome B. Libin argued the cause for petitioner. With him on the briefs 'were Kathryn L. Moore and John V. Donnelly.

      Marcia Mason, Assistant Attorney General of Iowa, argued the cause for respondent. With her on the brief were Bonnie J. Campbell, Attorney General, and Harry M. Griger, Special Assistant Attorney General.

      Kent L. Jones argued the cause for the United States as amicus curiae urging affirmance. With him on the brief were Solicitor General Starr, Acting Assistant Attorney General Bruton, Deputy Solicitor General Wallace, Gary B. Allen, and Ernest J. Brown.

      Briefs of amici curiae urging reversal were filed for Avon Products, Inc., et al. by Timothy B. Dyk, Edward, K. Bilieh, and Maryann B. Gall; for Chevron Corp. et al. by Mark L. Evans, Alan I. Horowitz, and Anthony F. Shelley; and for the Washington Legal Foundation by Stephan G. Weil, Susan G. Braden, Daniel J. Popeo, and Paul D. Kamenar.

        Richard Ruda, Michael G. Dzialo, Martin Label, and James F. Flug filed a brief for the National Conference of State Legislatures et al. as amici curiae urging affirmance.

   Justice Stevens

delivered the opinion of the Court.

In 1981 petitioner Kraft General Foods, Inc. (Kraft), operated a unitary business throughout the United States and in several foreign countries. Because part of its business was conducted in Iowa, Kraft was subject to the Iowa Business Tax on Corporations. At issue in this case is Iowa’s inclusion in the tax base of the dividends that Kraft received from six subsidiaries, each of which was incorporated and conducted its business in a foreign country. While Iowa taxes the dividends that a corporation receives from its foreign subsidiaries, Iowa does not tax dividends received from domestic subsidiaries. The question presented is whether the disparate treatment of dividends from foreign and from domestic subsidiaries violates the Foreign Commerce Clause.

I

The Iowa statute uses the federal definition of “net income” with certain adjustments. For federal tax purposes, corporations are generally allowed a deduction for dividends received from domestic subsidiaries. As the earnings of the domestic subsidiaries, themselves, are subject to federal taxation, this deduction avoids a second federal tax on those earnings. The Federal Government generally does not tax the earnings of foreign subsidiaries, and the dividends paid by foreign subsidiaries are not deductible. The parent corporation, however, does receive a credit for the foreign taxes paid on the dividends and on the underlying foreign earnings. Like the deduction for domestic subsidiary dividends, the foreign tax credit is intended to mitigate multiple taxation of corporate earnings.

In following the federal scheme for the calculation of taxable income, Iowa allows a deduction 'for dividends received from domestic subsidiaries, but not for those received from foreign subsidiaries. Iowa does not directly tax the income of a subsidiary unless the subsidiary, itself, does business in Iowa. Thus, if a domestic subsidiary transacts business in Iowa, its income is taxed, but if it does not do business in Iowa, neither its income nor the dividends paid to its parent are taxed. In the ease of the foreign subsidiary doing business abroad, Iowa does not tax the corporate income,'but does tax the dividends paid to the parent. Unlike the Federal Government, Iowa does not allow a credit for taxes paid to foreign countries. See 465 N. W. 2d 664, 665 (Iowa 1991).

In computing its taxable income on its 1981 Iowa return, Kraft deducted foreign subsidiary dividends, notwithstanding contrary provisions of Iowa law. Respondent Iowa Department of Revenue and Finance (Iowa) assessed a defi-cieney. After its administrative protest was denied, Kraft challenged the assessment in Iowa courts, alleging that the disparate treatment of domestic and foreign subsidiary dividends violated the Commerce Clause and the Equal Protection Clause of the Federal Constitution. The Iowa Supreme Court rejected the Commerce Clause claim because petitioner failed to demonstrate “that Iowa businesses receive a commercial advantage over foreign commerce due to Iowa’s taxing scheme.” Id., at 668. In considering Kraft’s challenge under the Equal Protection Clause, the court found that Iowa’s use of the federal formula for calculation of taxable income was convenient both for the taxpayer and for the State. Concluding that the Iowa statute was rationally related to the goal of administrative efficiency, the Iowa Supreme Court held that the statute did not violate equal protection. Id., at 669. We granted certiorari. 502 U. S. 1056 (1992).

II

The principal dispute between the parties concerns whether, on its face, the Iowa statute discriminates against foreign commerce. It is indisputable that the Iowa statute treats dividends received from foreign subsidiaries less favorably than dividends received from domestic subsidiaries. Iowa includes the former, but not the latter, in the calculation of taxable income. While admitting that the two kinds of dividends are treated differently, Iowa and its amici advance several arguments in support of the proposition that this differential treatment does not constitute prohibited discrimination against foreign commerce.

Amicus United States notes that a subsidiary’s place of incorporation does not necessarily correspond to the locus of its business operations. A domestic corporation might do business abroad, and its dividends might reflect earnings from its foreign activity. Conversely, a foreign corporation might do business in the United States, with its dividend payments reflecting domestic business operations. On this basis, the United States contends that the disparate treatment of dividends from foreign and domestic subsidiaries does not translate into discrimination based on the location or nature of business activity and is thus not prohibited by the Commerce Clause.

We recognize that the domicile of a corporation does not necessarily establish that it is engaged in either foreign or domestic commerce. In this case, however, it is stipulated that the foreign subsidiaries did, in fact, operate in foreign commerce and, further, that the decision to do business abroad through foreign subsidiaries is typically supported by legitimate business reasons. By its nature, a unitary business is characterized by a flow of value among its components. See Container Corp. of America v. Franchise Tax Bd., 463 U. S. 159, 178 (1983). The flow of value between Kraft and its foreign subsidiaries clearly constitutes foreign commerce; this flow includes the foreign subsidiary dividends, which, as Iowa acknowledges, themselves constitute foreign commerce.

Moreover, through the interplay of the federal and Iowa tax statutes, the applicability of the Iowa tax necessarily depends not only on the domicile of the subsidiary, but also on the location of the subsidiary’s business activities. The Federal Government generally taxes the income that a foreign corporation earns in the United States. To avoid multiple taxation, the Government allows a deduction for foreign subsidiary dividends that reflect such domestic earnings. In adopting the federal pattern, Iowa also allows a deduction for dividends received from a foreign subsidiary if the dividends reflect business activity in the United States. Accordingly, while the dividends of all domestic subsidiaries are excluded from the Iowa tax base, the dividends of foreign subsidiaries are excluded only to the extent they reflect domestic earnings. In sum, the only subsidiary dividend payments taxed by Iowa are those reflecting the foreign business activity of foreign subsidiaries. We do not think that this discriminatory treatment can be justified on the ground that some of the (untaxed) dividend payments from domestic subsidiaries also reflect foreign earnings.

In a related argument, Iowa and amicus United States assert that Kraft could conduct its foreign business through domestic subsidiaries instead of foreign subsidiaries or, alternatively, could set up a domestic company to hold the stock of the foreign subsidiaries and receive the foreign dividend payments. In either case, Kraft, itself, would receive no dividends from foreign subsidiaries and would thus avoid paying Iowa tax on income attributable to the foreign operations. Iowa and the United States contend that these alternatives further demonstrate that it is not foreign commerce, but, at most, a particular form of corporate organization that is burdened.

This argument is not persuasive. Whether or not the suggested methods of tax avoidance would be practical as a business matter, and whether or not they might generate adverse tax consequences in other jurisdictions, we do not think that a State can force a taxpayer to conduct its foreign business through a domestic subsidiary in order to avoid discriminatory taxation of foreign commerce. Cf. Metropolitan Life Ins. Co. v. Ward, 470 U. S. 869, 878-879 (1985). We have previously found that the Commerce Clause is not violated when the differential tax treatment of two categories of companies "results solely from differences between the nature of their businesses, not from the location of their activities.” Amerada Hess Corp. v. Director, Div. of Taxation, N. J. Dept. of Treasury, 490 U. S. 66, 78 (1989). We find no authority for the different proposition advanced here that a tax that does discriminate against foreign commerce may be upheld if a taxpayer could avoid that discrimination by changing the domicile of the corporations through which it conducts its business. Our cases suggest the contrary. See Westinghouse Electric Corp. v. Tully, 466 U. S. 388, 406 (1984); Halliburton Oil Well Cementing Co. v. Reily, 373 U. S. 64, 72 (1963).

Repeating the argument that prevailed in the Iowa Supreme Court, Iowa next insists that its tax system does not violate the Commerce Clause because it does not favor local interests. To the extent corporations do business in Iowa, an apportioned share of their entire corporate income is subject to Iowa tax. In the case of a foreign subsidiary doing business abroad, Iowa would tax the dividends paid to the domestic parent, but would not tax the subsidiary’s earnings. Summarizing this analysis, Iowa asserts: “More earnings of the domestic subsidiary, which has income producing activities in Iowa, than earnings of the foreign subsidiary, which has no Iowa activities, are included in the preapportioned net income base for the unitary business as a whole.” Brief for Respondent 19. Far from favoring local commerce, Iowa argues, the tax system places additional burdens on Iowa businesses.

We agree that the statute does not treat Iowa subsidiaries more favorably than subsidiaries located elsewhere. We are not persuaded, however, that such favoritism is an essential element of a violation of the Foreign Commerce Clause. In Japan Line, Ltd. v. County of Los Angeles, 441 U. S. 434 (1979), we concluded that the constitutional prohibition against state taxation of foreign commerce is broader than the protection afforded to interstate commerce, id., at 445-446, in part because matters of concern to the entire Nation are implicated, id., at 448-451. Like the Import-Export Clause, the Foreign Commerce Clause recognizes that discriminatory treatment of foreign commerce may create problems, such as the potential for international retaliation, that concern the Nation as a whole. Id., at 450. So here, we think that a State’s preference for domestic commerce over foreign commerce is inconsistent with the Commerce Clause even if the State’s own economy is not a direct beneficiary of the discrimination. As the absence of local benefit does not eliminate the international implications of the discrimination, it cannot exempt such discrimination from Commerce Clause prohibitions.

Iowa and amicus United States also assert the stronger claim that Iowa’s tax system does not favor business activity in the United States generally over business activity abroad. If true, this would indeed suggest that the statute does not discriminate against foreign commerce. We are not convinced, however, that this description adequately characterizes the relevant features of the Iowa statute. It is true that if a subsidiary were located in another State, its earnings would be subject to taxation by the Federal Government and by the other State (assuming that the State was one of the great majority that impose a corporate income tax). This state and federal tax burden might exceed the sum of the foreign tax that a foreign subsidiary would pay and the tax that Iowa collects on dividends received from a foreign subsidiary. But whatever the tax burdens imposed by the Federal Government or by other States, the fact remains that Iowa imposes a burden on foreign subsidiaries that it does not impose on domestic subsidiaries. We have no reason to doubt the assertion of the United States that “[i]n evaluating the alleged facial discrimination effected by the Iowa tax, it is not proper to ignore the operation of other provisions of the same statute.” Brief for United States as Amicus Curiae 14, n. 19 (emphasis added). We find no authority, however, for the principle that discrimination against foreign commerce can be justified if the benefit to domestic subsidiaries might happen to be offset by other taxes imposed not by Iowa, but by other States and by the Federal Government.

Finally, Iowa insists that even if discrimination against foreign commerce does result, the statute is valid because it is intended to promote administrative convenience rather than economic protectionism. Iowa contends that the adoption of the federal definition of “taxable income,” which includes foreign subsidiary dividends, provides significant advantages both to the taxpayers and to the taxing authorities. Taxpayers may compute their Iowa tax easily based on their federal calculations, and the Iowa authorities may rely on federal regulations and interpretations and may take advantage of federal efforts to monitor taxpayer compliance. See 465 N. W. 2d, at 669.

We do not minimize the value of having state forms and auditing procedures replicate federal practice. Absent a compelling justification, however, a State may not advance its legitimate goals by means that facially discriminate against foreign commerce. See Philadelphia v. New Jersey, 437 U. S. 617, 626-628 (1978); Maine v. Taylor, 477 U. S. 131, 148, n. 19 (1986). In this instance, Iowa could enjoy substantially the same administrative benefits by utilizing the federal definition of taxable income, while making adjustments that avoid the discriminatory treatment of foreign subsidiary dividends. Many other States have adopted this approach. It is apparent, then, that this is not a case in which the State’s goals “cannot be adequately served by reasonable nondiscriminatory alternatives.” New Energy Co. of Indiana v. Limbach, 486 U. S. 269, 278 (1988). Even if such adjustments would diminish the administrative benefits of adopting federal definitions, this marginal loss in convenience would not constitute the kind of serious health and safety concern that we have sometimes found sufficient to justify discriminatory state legislation. Cf. Maine v. Taylor, 477 U. S., at 151; Sporhase v. Nebraska ex rel. Douglas, 458 U. S. 941, 956-957 (1982).

> — t > — i i-H

Iowa need not adopt the federal definition of taxable income. Nor, having chosen to follow the federal system in part, must Iowa duplicate that scheme in all respects. The adoption of the federal system in whole or in part, however, cannot shield a state tax statute from Commerce Clause scrutiny. The Iowa statute cannot withstand this scrutiny, for it facially discriminates against foreign commerce and therefore violates the Foreign Commerce Clause.

The judgment of the Supreme Court of Iowa is reversed, and the case is remanded for further proceedings not inconsistent with this opinion.

It is so ordered.'

ChieF Justice Rehnquist,

with whom Justice Black-mun joins,

dissenting.

Petitioner in this case limits its Commerce Clause challenge to a single argument — that Iowa’s taxing scheme unconstitutionally discriminates against foreign commerce. It has brought a facial challenge to the Iowa taxing scheme. The burden on one making a facial challenge to the constitutionality of a statute is heavy; the litigant must show that “no set of circumstances exists under which the Act would be valid. The fact that [the tax] might operate unconstitutionally under some conceivable set of circumstances is insufficient to render it wholly invalid.” United States v. Salerno, 481 U. S. 739, 745 (1987).

The only case dealing with the Foreign Commerce Clause substantially relied on by the Court in its opinion upholding petitioner’s challenge to the Iowa statute is Japan Line, Ltd. v. County of Los Angeles, 441 U. S. 434 (1979). It is important, therefore, to note how different are the facts in that case from those in the present one. In Japan Line, California had levied a nondiscriminatory ad valorem property tax on cargo containers which were owned by Japanese shipping companies based in Japan, had their home ports in Japan, and were used exclusively in foreign commerce. The containers were physically present in California for a fractional part of the year, but only as a necessary incident of their employment in foreign commerce. Japan levied no tax on similarly situated property of United States shipping companies. -

In Container Corp. of America v. Franchise Tax Bd., 463 U. S. 159 (1983), where we upheld a California franchise tax against a claim of violation of the Foreign Commerce Clause, we noted at least two distinctions between that case and our earlier decision in Japan Line. First, the tax there imposed was not on a foreign entity, but on a domestic corporation. Second, the United States did not file a brief urging that the tax be struck down. 463 U. S., at 196. In the present case, like Container Corporation, the Iowa tax is imposed on a domestic corporation, not on a foreign entity. And in the present case, the Executive Branch has not merely remained neutral, as it did in Container Corporation, but has filed a brief urging that the tax be sustained against the Foreign Commerce Clause challenge.

The Court agrees that the Iowa tax involved here does not favor subsidiaries incorporated in Iowa over foreign subsidiaries, but points out that the tax does favor subsidiaries incorporated in other States over foreign subsidiaries. Iowa, obviously has no selfish motive to accomplish such a result, and the absence of such a motive is strong indication that none of the local advantage which has so often characterized our Commerce Clause decisions is sought here. See, e. g., Bacchus Imports, Ltd. v. Dias, 468 U. S. 263, 268 (1984). Indeed, petitioner carries on operations in Iowa, where the “State’s own political processes [can] serve as a check against unduly burdensome regulations.” Kassel v. Consolidated Freightways Corp. of Del., 450 U. S. 662, 675 (1981).

But assuming that it is sufficient to show simply that non-Iowa domestic “commerce” enjoys a benefit not enjoyed by foreign “commerce,” the Court surely errs in concluding that such a showing has been made in the present case. Because petitioner has chosen to make a facial challenge to the Iowa statute, the record is largely devoid of any evidence to suggest that Iowa’s taxing scheme systematically works to discourage foreign commerce to the advantage of its domestic counterpart.

Petitioner’s failures in this respect are severalfold. First, it is unclear on the present record what amount of foreign commerce is affected by the Iowa statute. The difficulty flows from our inability to make any useful generalizations about a corporation’s business activity based solely on the corporation’s country of incorporation. The Court recognizes that, in this era of substantial international trade, it is simple-minded to assume that a corporation’s foreign domicile necessarily reflects that it is principally, or even substantially, engaged in foreign commerce. Ante, at 76. To the contrary, foreign domiciled corporations may engage in little or even zero foreign activity. In such cases, the suggestion that Iowa’s tax has any real effect on foreign commerce is absurd; petitioner certainly has not demonstrated “by ‘clear and cogent evidence’ that [the state tax] results in extraterritorial values being taxed” in all cases. Franchise Tax Bd., supra, at 175. In turn, Iowa’s tax can hardly be found to always unconstitutionally discriminate against foreign commerce. Given that petitioner’s burden is to demonstrate that there are no circumstances in which Iowa’s statute could be constitutionally applied, the existence of such a possibility should be fatal to petitioner’s chances of success in this case.

The Court suggests that, even if foreign domiciled corporations are involved in no foreign trade, the dividend payments from subsidiary to parent are themselves “foreign commerce.” Ante, at 76. Again, this may be true in certain circumstances, as the payment of a dividend may represent a real flow of capital across international boundaries. But certainly there are other situations where the “foreign” aspects of a transaction are extraordinarily attenuated, and any burdening of such transactions concomitantly would not raise Foreign Commerce Clause concerns. Consider, for example, the case of a “foreign” subsidiary — i. e., one that is incorporated in a foreign country — but with operations exclusively in the United States. It has no assets in the foreign country, no operations, nothing of value whatsoever. The corporation declares a dividend payable to its United States parent. The payment in such circumstance may well be accomplished simply by debiting one New York bank account and crediting another. To characterize this as “foreign commerce” seems to me to stretch that term beyond all recognition. And again, the existence of such a possibility is sufficient to undermine petitioner’s facial challenge.

The Court appears to think these problems are surmounted by the parties’ stipulation that petitioner’s subsidiaries operated in “foreign commerce” and that foreign subsidiaries are often established for legitimate business reasons. Ibid. Of course, a stipulation between parties eannot bind this Court on a question of law. Moreover, even the facts that the stipulation establishes are sparse. It tells us nothing about the ratio in modern commerce of “real” foreign subsidiaries to their domestically oriented cousins. Indeed, on the present record it is impossible even to establish the scope of operation of Kraft’s subsidiaries. Compare App. to Pet. for Cert. 52a-53a (reporting foreign tax payments by 6 of petitioner’s subsidiaries) with id., at 76a-79a (listing petitioner’s 86 nonwholly owned subsidiaries). Without some greater detail, I think it is impossible to conclude that the Iowa taxing scheme would have such real and substantial effects that it could never survive constitutional muster.

Finally, Í cannot agree that, even if the dividend payments made taxable by the Iowa scheme are foreign commerce, that Iowa impermissibly discriminates against such payments. To be sure, two Iowa corporations, one with a foreign subsidiary and one with a domestic non-Iowa subsidiary will in some cases pay a different total tax. But this does not constitute unconstitutional discrimination because, as far as the record demonstrates, Iowa’s taxing scheme does not result in foreign commerce being systematically subject to higher tax burdens than domestic commerce. Given that 45 of 50 States tax corporations on their net income, ante, at 80, n. 22, in deciding to tax only a foreign subsidiary’s dividend payments, rather than the subsidiary’s total income, Iowa assures that the subsidiary’s tax burden is less than that faced by its domestic counterpart. The deduction that Iowa extends to domestically based dividend payments simply helps to avoid what would otherwise be the near certainty that the domestic income would be doubly taxed — once when earned as income by the subsidiary and a second time when paid to the parent corporation.

But Iowa’s attempt to take account of this near certainty with respect to domestic earnings does not in turn require it to make a similar assumption with respect to income earned by foreign sources. As amicus United States correctly points out, “[t]he record in this case fails to indicate even the existence, much less the nature, of such local-level foreign taxes .... Nor is there any evidence to reflect the credits or reductions that foreign local governments would apply or allow.” Brief for United States as Amicus Curiae 15, n. 21.

Finally, as I would reject petitioner’s Foreign Commerce Clause claim, I must go on to consider whether its Equal Protection Claim fares any better. It does not. In defending a tax classification such as this, a State need only demonstrate that the classification is rationally related to legitimate state purposes. Exxon Corp. v. Eagerton, 462 U. S. 176, 195 (1983). The statute will be upheld if it could reasonably be concluded “that the challenged classification would promote a legitimate state purpose.” Id., at 196. Administrative efficiency is certainly a legitimate state interest and Iowa’s reliance on the federal taxing scheme obviously furthers its achievement. Petitioner’s claim, therefore, must fail.

I would uphold the Iowa tax statute against this facial , challenge.

      Iowa Code §422.32 et seq. (1981).

       See App. to Pet. for Cert. 29a. Kraft owned capital stock representing more than 80% of the voting power and of the total value of the subsidiaries. Ibid.

       “The Congress shall have Power ... To regulate Commerce with foreign Nations-” U. S. Const., Art. I, §8.

       See Iowa Code §422.35 (1981).

       See 26 U.S.C. §243.

       See 465 N. W. 2d 664, 665 (Iowa 1991); B. Bittker & J. Eustice, Federal Income Taxation of Corporations and Shareholders ¶ 5.05 (5th ed. 1987).

       See 26 U. S. C. §§901, 902. Instead of taking the credit, the corporation may elect to deduct the foreign tax withheld on dividends from foreign subsidiaries. See § 164. The taxpayer may not take both the credit and the deduction. See § 275(a)(4). The credit is almost always more valuable to the taxpayer. See 3 B. Bittker & L. Lokken, Federal Taxation of Income, Estates and Gifts ¶ 69.14 (2d ed. 1991).

       See United States v. Goodyear Tire & Rubber Co., 493 U. S. 132, 139 (1989); American Chicle Co. v. United States, 316 U. S. 450, 452 (1942); see also Bittker & Eustice, Federal Income Taxation of Corporations and Shareholders ¶ 17.11.

       Iowa is not a State that taxes an apportioned share of the entire income of a unitary business, without regard for formal corporate lines. See Tr. of Oral Arg. 37; cf. Container Corp. of America v. Franchise Tax Bd., 463 U. S. 159, 164-169 (1983).

       At oral argument, counsel for Kraft offered the following illustration: “If an Iowa parent company had a Kentucky subsidiary, [that] did all its business in Kentucky, and another subsidiary that did all its business in Germany, Iowa would not tax the income of either of those subsidiaries. If each paid a dividend to the Iowa parent, Iowa would tax the German dividends and would not tax the Kentucky dividends.” Tr. of Oral Arg. 47-48.

       If in calculating its federal tax liability, a taxpayer elects to deduct foreign tax withheld on foreign subsidiary dividends, a taxpayer may also deduct these tax payments in calculating its Iowa taxes. Electing the deduction, then, allows the taxpayer to reduce, but not eliminate, the Iowa tax on foreign subsidiary dividends. In the relevant year, Kraft elected to take the foreign tax credit, see 465 N. W. 2d, at 666, and thus could not deduct the foreign taxes in computing its federal or Iowa taxable income, see n. 7, supra.

       See 465 N. W. 2d, at 666.

       See App. to Pet. for Cert. 26a.

       “No state shall... deny to any person within its jurisdiction the equal protection of the laws.” U. S. Const., Arndt. 14, § 1.

       The parties stipulated as follows:
      “Domestic Corporations typically do business in foreign countries through corporations organized in the country in which they are doing business for a variety of reasons. Reasons include, but are not limited to, the requirements of the local country, a better ability to limit their liability in that country, the marketing advantage of being perceived by customers as a local company, greater ease in repatriating funds, greater ease in borrowing funds locally, and ability to own property and manufacture in that country.” App. to Pet. for Cert. 30a-31a.

       See Tr. of Oral Arg. 24,35.

       See 26 U. S. C. §882.

       See §246.

       The dissent presents the example of a subsidiary incorporated in a foreign country, but engaged in business exclusively in the United States. The dissent doubts whether a dividend payment from such a subsidiary is properly characterized as "foreign commerce.” Post, at 85. As discussed above, however, a dividend payment from such a subsidiary would not be taxed by Iowa. Iowa taxes foreign subsidiary dividends only to the extent that they reflect foreign earnings. The dissent does not dispute that this kind of dividend payment does constitute "foreign commerce.” Post, at 84.

         In Amerada Hess, we rejected the contention that a New Jersey tax violated the Commerce Clause because it “discriminate])!] against oil producers who market their oil in favor of independent retailers who do not produce oil.” 490 U. S., at 78.

       “No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws . . . .” U. S. Const., Art. I, § 10, cl. 2.

       Corporate income is taxed by 45 States and by the District of Columbia. See 1 J. Hellerstein, State Taxation: Corporate Income and Franchise Taxes ¶ 1.6 (1983).

       If one were to compare the aggregate tax imposed by Iowa on a unitary business which included a subsidiary doing business throughout the United States (including Iowa) with the aggregate tax imposed by Iowa on a unitary business which included a foreign subsidiary doing business abroad, it would be difficult to say that Iowa discriminates against the business with the foreign subsidiary. Iowa would tax an apportioned share of the domestic subsidiary’s entire earnings, but would tax only the amount of the foreign subsidiary’s earnings paid as a dividend to the parent.
      In considering claims of discriminatory taxation under the Commerce Clause, however, it is necessary to compare the taxpayers who are "most similarly situated.” Halliburton Oil Well Cementing Co. v. Reily, 373 U. S. 64, 71 (1963). A corporation with a subsidiary doing business in Iowa is not situated similarly to a corporation with a subsidiary doing business abroad. In the former case, the Iowa operations of the subsidiary provide an independent basis for taxation not present in the case of the foreign subsidiary. A more appropriate comparison is between corporations whose subsidiaries do not do business in Iowa.

       See App. to Pet. for Cert. 74a-75a.

      Having concluded that the Iowa statute violates the Foreign Commerce Clause, we do not reach Kraft's challenge to the statute under the Equal Protection Clause.