The Montana Department of Transportation settled a discrimination lawsuit for $485,000 on Feb. 23, ending five years of litigation by Mountain West Holding Company, a Billings-based highway contracting firm with offices in Missoula, Butte and Bozeman.
“Their claim essentially was that we were discriminating against them based upon their race,” says Dave Ohler, lead counsel for MDT. The owner of Mountain West is white. “So it’s commonly called a reverse discrimination kind of claim,” Ohler says.
At issue was the state’s implementation of its Disadvantaged Business Enterprise (DBE) Program, a requirement attached to federal highway funds that mandates states make efforts to include businesses owned by women, minorities and individuals of low net worth.
Montana does not use race-based criteria to determine its goals for DBE utilization, but Mountain West alleged that the state’s goals at the time exceeded the federal requirements, and because of that Mountain West was denied contracts on the basis of race, gender or national origin. After the suit was dismissed in federal district court, Mountain West appealed, and the 9th Circuit rejected all but one of the company’s claims, a count of violating the anti-discrimination protections of Title VI of the Civil Rights Act.
“We obviously disputed the case and were prepared to go to trial and defend our position,” Ohler says. But the state decided to settle. “When you have a case, there’s always a potential for getting an adverse decision and a potential for getting legal decisions that aren’t favorable,” Ohler says.
A who’s who of anti-affirmative action conservative and libertarian think-tanks filed briefs on behalf of Mountain West, including the Cato Institute, the Mountain States Legal Foundation and the Center for Equal Opportunity, all of which oppose programs like DBE because, they say, they interfere with fair market processes. Mountain West did not respond to a request for comment by press time.
In a 2016 disparity report commissioned by MDT, almost half of DBE interviewees reported being subject to or witnessing discrimination toward minorities and women by other contractors or government employees. The report stated, “There is also substantial qualitative evidence that a ‘good ol’ boy’ network negatively affects opportunities for businesses including those owned by minorities and women.”
Data collected in that report formed the basis for the current race-neutral policies that MDT uses in deciding what percentage of spending to direct to DBEs.
Mountain West functions as both a prime contractor and subcontractor on state projects, and also works for private companies. Its website touts the company’s traffic control for the oil sands megaloads that traveled through Montana.
Mountain West held a large amount of the state’s highway business during the period in which the company says discriminatory policies were in place. The state said in court documents that Mountain West accounted for 50.58 percent of state spending on traffic control, 59.92 percent on guardrails, 60.30 percent on signage and 69.11 percent on concrete barriers in 2014. In every category, Mountain West’s share of state spending was more than the state spent with all DBEs combined.