No. 94-50552 IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT MARGO NEFF, et al., Plaintiffs-Appellants v. AMERICAN DAIRY QUEEN, INC. Defendants-Appellees APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS BRIEF FOR THE UNITED STATES AS AMICUS CURIAE DEVAL L. PATRICK Assistant Attorney General JESSICA DUNSAY SILVER MARIE K. McELDERRY Attorneys Department of Justice P.O. Box 66078 Washington, D.C. 20035-6078 (202) 514-3068 01-07393 TABLE OF CONTENTS PAGE INTEREST OF THE UNITED STATES . . . . . . . . . . . . . . . . . . . 1 STATEMENT OF THE ISSUE . . . . . . . . . . . . . . . . . . . . . . . 2 STATEMENT OF THE CASE . . . . . . . . . . . . . . . . . . . . . . . 2 1. Statutory scheme . . . . . . . . . . . . . . . . . . . . 2 2. Procedural history. . . . . . . . . . . . . . . . 3 3. Facts . . . . . . . . . . . . . . . . . . . . . . . . . . 4 4. Decision below. . . . . . . . . . . . . . . . . . . . . . 7 INTRODUCTION AND SUMMARY OF ARGUMENT . . . . . . . . . . . . . . . 8 ARGUMENT: SUMMARY JUDGMENT WAS INAPPROPRIATE ON THIS RECORD . . . . . 10 A. The Record Demonstrates A Factual Dispute Over The Extent To Which ADQ "Operates" The Stores At Issue .. . . . . . . . . . . . . . . . . . . . . . . 11 B. The ADA Regulations Do Not Permit A Franchisor To Escape Liability For Statutory Compliance By Allocating To The Franchisee Responsibility For Compliance With Federal Law. . . . . . . . . . . . . . . 15 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 TABLE OF AUTHORITIES CASES: Asbury v. Brougham, 866 F.2d 1276 (10th Cir. 1989). . . . . 17 Celotex Corp. v. Catrett, 477 U.S. 317 (1986) . . . . . . . 10 Culpepper v. Reynolds Metals Co., 421 F.2d 888 (5th Cir. 1970) . . . . . . . . . . . . . . . . . . . . . 12 Fisher v. NWA, Inc., 883 F.2d 594 (8th Cir. 1989), cert. denied, 495 U.S. 947 (1990) . . . . . . . . . . . . 10 Gates v. Collier, 616 F.2d 1268 (5th Cir. 1980) . . . . . . 12 - i - 01-07394 CASES (cont'd): PAGE Hansen v. Continental Ins. Co., 940 F.2d 971 (5th Cir. 1991) . . . . . . . . . . . . . . . . . . . . . 10 Irwin v. United States, 558 F.2d 249 (5th Cir. 1977) . 10, 11 Kinney v. Yerusalim, 812 F. Supp. 547 (E.D. Pa.), aff'd, 9 F.3d 1067 (3d Cir. 1993), cert. denied sub nom. Hoskins v. Kinney, 114 S. Ct. 1545 (1994) . . . 12-13 Marr v. Rife, 503 F.2d 735 (6th Cir. 1974) . . . . . . . . 17 Neff v. American Dairy Queen, slip opinion (W.D. Tex. July 14, 1994) . . . . . . . . . . . . . . . . . . . 7, 8, 9 Peyton v. Rowe, 391 U.S. 54 (1968) . . . . . . . . . . . . 12 Smith v. Hudson, 600 F.2d 60 (6th Cir.), cert. dismissed, 444 U.S. 986 (1979) . . . . . . . . . . . . . . 10 Smith v. United States, 113 S. Ct. 2050 (1993) . . . . . . 11 Tcherepnin v. Knight, 389 U.S. 332 (1967) . . . . . . . . . 12 Trnka v. Elanco Products, 709 F.2d 1223 (8th Cir. 1983). . . . . . . . . . . . . . . . . . . . . 10 United States v. DeRosier, 473 F.2d 749 (5th Cir. 1973) . . . . . . . . . . . . . . . . . . . . . 12 Walker v. Crigler, 976 F.2d 900 (4th Cir. 1992) . . . . . . 17 Young v. American Dairy Queen, Inc., No. 5:93-CV-253-C (N.D. Tex., June 22, 1994). . . . . . . 8 STATUTES: Americans With Disabilities Act of 1990 (ADA): 42 U.S.C. 12181(7). . .. . . . . . . . . . . . . . . . . . 8 42 U.S.C. 12181(7)(B) . . . . . . . . . . . . . . . . . . 2 42 U.S.C. 12181(9) . . . . . . . . . . . . . . . . . 2-3, 3 42 U.S.C. 12182(a) (Section 302(a)) .. . . . . . . . . 1, 2 42 U.S.C. 12182(b)(2)(A)(iv). . . . . . . . . . . . . . . 2 42 U.S.C. 12188(b)(1)(B) (Title III). . . . . . . . . . . 1 28 U.S.C. 1331 . . . . . . . . . . . . . . . . . . . . . . 4 28 U.S.C. 1441 . . . . . . . . . . . . . . . . . . . . . . 4 - ii - 01-07395 RULES AND REGULATIONS: PAGE 28 C.F.R. 36.201(b). . . . . . . . . . . . . . . . . . . . 16 Fed. R. Civ. P. 56 . . . . . . . . . . . . . . . . . . . . 10 MISCELLANEOUS: PAGE Americans With Disabilities Act Handbook: III-41-III-44 . . . . . . . . . . . . . . . . . . . . . . 16 United States Department of Justice, Title III Technical Assistance Manual (Nov. 1993). . . . . . . . . . 16 7 The Oxford English Dictionary (1933). . . . . . . . . . . 11 2 New Shorter Oxford English Dictionary (1993) . . . . . . . 12 Webster's II: New Riverside University Dictionary (1988) . .. . . . . . . . . . . . . . . . . . . 11 - iii - 01-07396 IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT No. 94-50552 MARGO NEFF, et al., Plaintiffs-Appellants v. AMERICAN DAIRY QUEEN, INC., Defendants-Appellees APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS BRIEF FOR THE UNITED STATES AS AMICUS CURIAE INTEREST OF THE UNITED STATES This appeal involves an issue of interpretation of Section 302(a) of the Americans With Disabilities Act of 1990, 42 U.S.C. 12182(a) (ADA), which prohibits discrimination against persons with disabilities in places of public accommodation. The Attorney General is authorized by Title III of the ADA to file a civil action if she has reasonable cause to believe that any person is engaged in a pattern or practice of discrimination, or where discrimination against a person or group of persons raises an issue of public importance. 42 U.S.C. 12188(b)(1)(B). The United States has received a large number of complaints alleging discrimination in places of public accommodation such as chain hotels, restaurants, and other businesses that use the franchise method of operation. The narrow interpretation given 01-07397 - 2 - to the term "operates" by the district court in this case will adversely affect the government's ability to enforce compliance with the Act. STATEMENT OF THE ISSUE Whether the district court properly determined, on a motion for summary judgment, that franchisor, American Dairy Queen, Inc., does not "operate[]" a place of public accommodation within the meaning of Section 302(a) of the Americans With Disabilities Act, 42 U.S.C. 12182(a). STATEMENT OF THE CASE 1. Statutory scheme Section 302(a) of the ADA, 42 U.S.C. 12182(a) provides: No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation. An establishment serving food and drink is a place of public accommodation within the meaning of the Act. 42 U.S.C. 12181(7)(B). Neither the statute nor the regulations defines the term "operates." Prohibited discrimination by an entity subject to Title III includes (42 U.S.C. 12182(b)(2)(A)(iv)): a failure to remove architectural barriers, and communication barriers that are structural in nature, in existing facilities * * * where such removal is readily achievable. "Readily achievable" means "easily accomplishable and able to be carried out without much difficulty or expense." 42 U.S.C. 01-07398 - 3 - 12181(9). The Act lists a number of factors that should be considered in determining whether an action is readily achievable. These include (42 U.S.C. 12181(9)): (A) the nature and cost of the action needed under this chapter; (B) the overall financial resources of the facility or facilities involved in the action; the number of persons employed at such facility; the effect on expenses and resources, or the impact otherwise of such action upon the operation of the facility; (C) the overall financial resources of the covered entity; the overall size of the business of a covered entity with respect to the number of its employees; the number, type, and location of its facilities; and (D) the type of operation or operations of the covered entity, including the composition, structure, and functions of the workforce of such entity; the geographic separateness, administrative or fiscal relationship of the facility or facilities in question to the covered entity. 2. Procedural history This action was brought as a class action by Margo Neff, who uses a wheelchair for mobility, alleging that American Dairy Queen, Inc. (ADQ) operates a place of public accommodation at two Dairy Queen stores in San Antonio, Texas, and has failed to remove architectural barriers to access, in violation of Title III of the ADA. The alleged violations in these stores include inaccessible ramps, restrooms, and service counters. Suit was originally brought in state court, but was removed by the 01-07399 - 4 - defendant to federal district court, pursuant to 28 U.S.C. 1441.1/ ADQ moved for summary judgment, arguing that it is not subject to the barrier removal requirement of Title III because it does not own, lease or lease to, or operate the two Dairy Queen stores. It claimed that, pursuant to the franchise agreements, the franchisee of the two stores, R & S Dairy Queen, Inc. (R&S), is the owner and operator of the stores and is therefore solely responsible for compliance with Title III. The district court granted summary judgment in favor of ADQ. 3. Facts The Dairy Queen stores in question are located at 13122 Nacogdoches and at 9726 Perrin-Beitel, in San Antonio, Texas. The record contains the franchise agreements applicable to both stores ("Nacogdoches Agreement" and "Perrin Agreement"). Paragraph 5.1 of the Nacogdoches Agreement states that the franchise shall be equipped in "accordance with Company's approved specifications and standards," as to such areas as design, layout, and signage. Any replacement, reconstruction, addition or modification of the building requires the Company's prior written consent. Nacogdoches Agreement at P 5.2. The franchisee must also maintain the building, equipment, and signage "in accordance with requirements established periodically ______________________ 1/ 28 U.S.C. 1441 provides that any civil action brought in a state court of which the federal district courts would have original jurisdiction may be removed by the defendant. The district court has jurisdiction under 28 U.S.C. 1331. 01-07400 - 5 - by" ADQ. Id. at P 5.3. If the franchisee does not comply with all of the established specifications and standards set out in the agreement, ADQ has the right to terminate the agreement. Id. at PP 11.1, 11.2. The franchisee must "operate" the store in accordance with the "business system, methods and sales promotion programs developed, approved and revised periodically by [the] Company." Nacogdoches Agreement at P 1.3. Management issues are controlled by these ADQ "system" standards. Paragraph 6.7 of the agreement states: Licensee shall adopt and use as his continuing operational routine the standard "Dairy Queen" management system, as prescribed in the Store Management Operations Manual, including Company's standards with respect to product preparation, merchandising, employee training, equipment and facility maintenance and sanitation. The franchisee is also required to keep its books, records, and financial reports using methods prescribed by ADQ. Id. at P 9.4. ADQ can inspect the facility at any time, and it prescribes the hours that the store can operate and the content of the store menu. Nacogdoches Agreement at PP 6.5, 6.6, 6.1, and Addendum to Agreement. Although ADQ does not hire store employees, new managers are required to attend a special training program that ADQ organizes, and store management is required to attend national and regional conferences given by ADQ. Id. at PP 7.4, 7.1, and Addendum to Agreement at P 3. The franchisee is required to submit monthly financial reports to ADQ. Id. at P 9.5. 01-07401 - 6 - The franchisee pays a monthly license fee of 3 percent of gross retail sales of its trademarked and nontrademark products, as well as a sales promotion fee of between 3 and 5 percent. Nacogdoches Agreement at PP 9.1(ii), (iii), and Addendum P 2. The provisions in the franchise agreement for the store at 9726 Perrin also show significant control by ADQ. Just as in the Nacogdoches Agreement, any breach of any term of the agreement by the franchisee may result in ADQ terminating the agreement. 1971 Franchise Agreement for 9726 Perrin. Perrin Agreement at P 11. The franchisee must build its store in accordance with "Dairy Queen" blueprints furnished by the Licensor. Id. at P 7. 2/ Paragraph 14 states that the franchisee must keep the physical layout and appearance of the building uniform. The franchisee is required to use the "Dairy Queen bookkeeping system," and to submit a monthly itemized financial report. Perrin Agreement at PP 6, 5(2). Store employees must wear white uniforms. Id. at P 8. Pursuant to a 1985 addendum to the agreement, the franchisee must contribute a certain percentage of its gross sales to an advertising fund, dependent on whether other franchisees in the local area are contractually ______________________ 2/ The agreement was entered into in 1971 by ADQ's predecessor, Dairy Queen Products of Texas, with a franchisee named Ronald Schreiber, who later assigned the franchise to R&S. ADQ has stated that the 1971 agreement is the agreement under which the franchise is currently operating. ADQ Brief in support of its motion for summary judgment at 9, P 26. The building was built pursuant to this agreement around 1972 or 1973 (see ADQ Brief at 8, P 19), and under the agreement was required to be built according to Dairy Queen's specifications and blueprints (Perrin Agreement at P 7). 01-07402 - 7 - committed to ADQ to do the same. In addition to this fee, the franchisee must pay a monthly licensing fee or royalty of 2 percent of its gross sales. Perrin Agreement at P 5(2). In the Perrin Agreement, the parties mutually agree to abide by the local, state, and federal laws in the execution of the contract. The agreement states: The parties herein mutually agree further and covenant and stipulate that it is their intention and desire to comply with all the laws of the State of Texas, State, County and Municipal, and of the United States, regarding the execution of this instant contract and that if any clause or clauses herein are held to be invalid because of public policy or statute, then the remainder of the contract shall be deemed severable therefrom and be binding and valid between the parties, it being at all times the intention of the parties herein to carry out such contract and provisions thereof where the same is not a contravention of such public policies, laws and statutes. Perrin Agreement at P 15. 4. Decision below The district court granted summary judgment to ADQ. The court held that ADQ does not "operate" either of the two Dairy Queens at issue, but simply licenses them to use its trademark in compliance with standards it sets (slip op. 6). The court held that, although the franchise agreements for the two stores provide that ADQ has the right to approve all construction plans and modifications in the stores, plaintiff Neff had provided no evidence that ADQ could require a franchisee to make modifications to an existing structure (ibid.). Although agreeing that ADQ might be subject to liability if it had refused to approve a franchisee's plans to bring a store into compliance 01-07403 - 8 - with the Act, the court found that Neff had not shown that ADQ had exercised its approval rights in any way inconsistent with the Act (ibid.). The court held that the mere existence of a veto power over proposed plans and modifications does not constitute "operating" for purposes of the Act (id. at 6-7). In so holding, the court noted that another district court in Texas had come to the same conclusion with respect to this defendant. Young v. American Dairy Queen, Inc., No. 5:93-CV-253- C (N.D. Tex. June 22, 1994). The court in Young held that "[r]etaining architectural control cannot be tantamount to operating a facility which one does not own or lease." See Neff, slip op. at 6 n.2. 3/ INTRODUCTION AND SUMMARY OF ARGUMENT In granting summary judgment to American Dairy Queen, the district court has held that a franchisor who exercises the considerable control of its franchisees evidenced by the agreements in the record does not "operate" a place of public accommodation within the meaning of the ADA. The categories of facilities represented in the statutory definition of "public accommodation," include many types of businesses in which franchise arrangements are common, e.g., hotels, restaurants, fast food establishments, day-care centers, movie theaters, and other places of recreation. 42 U.S.C. 12181(7). The district court's holding will frustrate the intent of Congress in enacting ________________________ 3/ In Young, summary judgment was granted after the plaintiff failed to respond to ADQ's summary judgment motion. 01-07404 - 9 - the ADA to eliminate discrimination against individuals with disabilities by insulating franchisors in this large segment of the business community from compliance with the Act's mandates. It is important to be able to enforce the ADA against a franchisor such as ADQ because it has the power to dictate how the stores are built and how they operate. Without the authority to reach franchisors that "operate" places of public accommodation, individuals with disabilities will not be able to receive the promise of the ADA to include them in the mainstream of American life. We argue below that the district court erred in granting summary judgment on this record. The question whether a franchisor "operates" a place of public accommodation is a question of fact. The facts relevant to that question are in dispute, and the district court erred in making a factual finding that ADQ "merely possess[es] a veto power over proposed plans and modifications." Slip op. 6. A trial is necessary here to allow plantiffs to introduce evidence to show that, in addition to the veto power on which the district court focused, ADQ has retained the right to direct and control the structure of the facilities and many aspects of the day-to-day operations of its franchises, including maintenance of the facilities. Summary judgment in favor of ADQ was thus improperly granted. 01-07405 - 10 - ARGUMENT SUMMARY JUDGMENT WAS INAPPROPRIATE ON THIS RECORD Summary judgment, pursuant to Rule 56 of the Federal Rules of Civil Procedure, is appropriate where the facts, as set forth in affidavits, depositions, answers to interrogatories, and responses to requests for production and admissions, show that there are no genuine issues of material fact to be tried and that the moving party is entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317 (1986). In order to prevail on a motion for summary judgment, the moving party has the burden to "establish the facts necessary to compel the legal result and to prove that such facts are not in genuine dispute." Irwin v. United States, 558 F.2d 249, 252 (5th Cir. 1977). The district court must consider this evidence, together with all inferences to be drawn therefrom, in the light most favorable to the party opposing the motion, scrutinizing the movant's papers closely, while viewing the papers of the opponent "indulgently." Smith v. Hudson, 600 F.2d 60, 63 (6th Cir.), cert. dismissed, 444 U.S. 986 (1979). The court must give the nonmoving party "the benefit of the reasonable inferences that can be drawn from the underlying facts." Fischer v. NWA, Inc., 883 F.2d 594, 598-99 (8th Cir. 1989), cert. denied, 495 U.S. 947 (1990), citing Trnka v. Elanco Products, 709 F.2d 1223 (8th Cir. 1983). Accord, Hansen v. Continental Ins. Co., 940 F.2d 971 (5th Cir. 1991). 01-07406 - 11 - A. The Record Demonstrates A Factual Dispute Over The Extent To Which ADQ "Operates" The Stores At Issue In this case, ADQ did not "establish the facts necessary to compel the legal result" reached by the district court. Irwin, 558 F.2d at 252. Rather, the district court relied solely on one provision of the franchise agreements in concluding that ADQ does not "operate" the two Dairy Queen stores at issue within the meaning of the ADA. Other provisions of the agreements, however, raise a question of fact concerning whether ADQ has sufficient control over its franchisee that it may be said to "operate" the stores, especially when plaintiff is given the benefit of reasonable inferences that can be drawn from those provisions. 4/ Neither the ADA itself nor the regulations defines the term "operates." Nor does the Act's legislative history directly address the issue of the liability of franchisors. When a word is not defined by statute, courts "normally construe it in accord with its ordinary or natural meaning." Smith v. United States, 113 S. Ct. 2050, 2054 (1993). To the extent that its franchise agreements give ADQ the power to direct the mode of operation of the individual franchises, it can be said to operate those stores within the ordinary meaning of the term "operates." 5/ For _______________________ 4/ The franchisees also operate the stores, and presumably, either lease or own them. Franchisee liability is not at issue in this case. 5/ In the context intended by the statute, i.e., as applied to a business, the dictionary defines "operate" in its transitive form as "[t]o control or direct the functioning of." Webster's II: New Riverside University Dictionary (1988), p. 823 (core meaning). See also 7 The Oxford English Dictionary, p. 144 (continued...) 01-07407 - 12 - example, in the Nacogdoches Agreement, the franchisee is directed in all aspects of its business operations and construction and maintenance of its facilities. Although the Perrin Agreement is somewhat less detailed than the Nacogdoches Agreement, it too contains sufficient indicia of direction and control by ADQ to preclude a judgment as a matter of law that ADQ does not operate the store. 6/ Under well-established canons of statutory construction, civil rights legislation should not be given a narrow or limited construction but rather should be liberally construed in order to effectuate its remedial purpose. Peyton v. Rowe, 391 U.S. 54, 65 (1968); Tcherepnin v. Knight, 389 U.S. 332, 336 (1967). 7/ As remedial legislation, therefore, the ADA must be construed broadly in order to effectuate its purpose to remedy discrimination against persons with disabilities. Kinney v. Yerusalim, 812 F. Supp. 547 (E.D. Pa.), aff'd, 9 F.3d 1067 (3d Cir. 1993), cert. denied sub nom. Hoskins v. Kinney, 114 S. Ct. ______________________ 5/ (...continued) (1933) ("[t]o direct the working of; to manage, conduct, work (a railway, business, etc.")); 2 New Shorter Oxford English Dictionary, p. 2005 (1993) ("[m]anage, direct the operation of (a business, enterprise, etc.")). 6/ Because the court decided this case on summary judgment, documents crucial to the issue of operation, such as the "Store Management Operations Manual," were apparently not before the court. 7/ This Court has applied this principle as to other civil rights statutes. E.g., Gates v. Collier, 616 F.2d 1268, 1274- 1275, 1278 (5th Cir. 1980) (Civil Rights Attorneys Fees Act); United States v. DeRosier, 473 F.2d 749, 751 (5th Cir. 1973) (Title II, Civil Rights Act of 1964); Culpepper v. Reynolds Metals Co., 421 F.2d 888 (5th Cir. 1970) (Title VII). 01-07408 - 13 - 1545 (1994). The district court in this case erred in failing to give a broad interpretation to the term "operates" in order to effectuate the purpose of the ADA. The record on summary judgment demonstrates that ADQ has retained considerable control over the two franchises in question. Through established specifications and standards, ADQ maintains ongoing control over the physical structure and layout of the building. In addition, the franchise agreements show that ADQ controls and directs the functioning of several aspects of the two stores. The court concluded that ADQ's right to approve all construction and modification plans, what the court termed a "veto power," was not enough to constitute "operating" the store. See Nacogdoches Agreement at P 5.2. The court erred in limiting its inquiry simply to the veto provision in the Nacogdoches Agreement and ignoring all of the other indicia of ADQ's control as evidenced by other provisions of the agreement. Those provisions show that ADQ has reserved much more control regarding structural issues than this veto power. 8/ Although the Nacogdoches building may have been constructed prior to ADQ's franchise agreement with R&S, the Nacogdoches ________________________ 8/ Even accepting the court's conclusion that ADQ possessed only a veto power, an appropriately broad reading of the ADA permits a conclusion that the power to veto a franchisee's efforts to comply with the ADA is itself a basis for finding that the franchisor "operates" the place of public accommodation within the meaning of the statute. However, it is not necessary to reach that issue on this record. 01-07409 - 14 - Agreement provides that the "building shall be maintained in accordance with requirements established periodically by" ADQ. Id. at P 5.3 (emphasis added). This clause strongly suggests that ADQ has ongoing, affirmative control over the premises, rather than the mere power to veto the franchisee's proposals. With respect to the store at 9726 Perrin, it appears to have been built in accordance with "Dairy Queen" blueprints. Perrin Agreement at P 7. Structural accessibility problems may be linked to these "Dairy Queen" blueprints. These provisions demonstrate that ADQ, through established specifications and standards, maintains control over the physical structure and layout of the building. If the franchisee does not comply with all of the established specifications and standards set out in the agreement, ADQ has the right to terminate the agreement. Nacogdoches Agreement at PP 11.1, 11.2; Perrin Agreement at P 11. ADQ relies (ADQ Brief at 17) upon language in the Nacogdoches Agreement (P 2.5) that the franchisee is an "independent entrepreneur, solely responsible for control and management of his business." Other provisions of the agreement belie this description, however. It provides that the franchisee is required to "operate" the store in accordance with the "business system, methods and sales promotion programs developed, approved and revised periodically by [the] Company." Nacogdoches Agreement at P 1.3. Management issues are also controlled by the 01-07410 - 15 - ADQ management system. Id. at P 6.7. Indeed, the agreement refers to a "Store Management Operations Manual." Ibid. Other examples showing that ADQ controls and directs the functioning of the two Dairy Queen stores include requirements that financial records be kept in accordance with ADQ methods, that new managers attend a training program organized by ADQ, and that monthly financial reports be submitted. Id. at PP 7.4, 9.3., 9.4. See also Perrin Agreement at P 6. In this case, the franchisee of the two stores is not an independent entity, but is economically dependent on ADQ for the operation of its stores. As stated above, ADQ has significant control over the physical structure, training, sales practices, and financial management of its franchises so as to control the operation of the businesses themselves. The franchisees depend on the use of the Dairy Queen name and products for their profit. The business is dependent not only on the managerial skills of the franchisees, but on the "system" of management put in place by ADQ, and where ADQ allows them to locate their businesses. ADQ has no involvement in whom the franchisees employ but it determines how they are trained and how they are to manage the stores. The district court erred in disregarding these provisions in granting summary judgment for ADQ on the issue whether it "operates" the two stores. B. The ADA Regulations Do Not Permit A Franchisor To Escape Liability For Statutory Compliance By Allocating To The Franchisee Responsibility For Compliance With Federal Law 01-07411 - 16 - ADQ relies (ADQ Brief at 21-23) upon a portion of the ADA regulations to argue that the Act was not intended to change any existing allocation of responsibilities as set forth in a contract between itself and a franchisee. It argues that because the franchise agreements with R&S allegedly give R&S the responsibility of complying with federal laws such as the ADA, ADQ cannot be held liable for ADA violations at the stores. ADA regulations promulgated by the Attorney General provide as to landlords and tenants (28 C.F.R. 36.201(b)): Both the landlord who owns the building that houses a place of public accommodation and the tenant who owns or operates the place of public accommodation are public accommodations subject to the requirements of [Title III]. As between the parties, allocation of responsibility for complying with the obligations of [Title III] may be determined by lease or other contract. ADQ's argument misinterprets this regulation. Such an allocation in a lease or contract is only effective as between the parties. Both the landlord and tenant remain fully liable for compliance with all of the provisions of the ADA relating to public accommodations. United States Department of Justice, Title III Technical Assistance Manual (Nov. 1993) at 3. The history of the rulemaking that resulted in section 36.201(b) is instructive. As originally drafted, the Title III regulation attempted itself to allocate responsibility between landlord and tenant. After receiving comments, however, the Attorney General recognized that the proposed allocations would not cover many practical situations. It was determined, therefore, to allow the parties to allocate responsibility 01-07412 - 17 - between them by contract or other agreement. ADA Handbook, III- 41-III-44. It is clear, however, that these allocations apply solely to which party bears initial responsibility for complying with the obligations of Title III; regardless of how they allocate responsibility between them, both parties remain legally liable. The analogy between landlord/tenant and franchisor/ franchisee is, however, a useful one. In the case of the franchisor/franchisee relationship, the relevant statutory concept is "operates." Even though the franchisor is not present on the premises on a daily basis, it can be an "operator" of a place of public accommodation that must comply with the ADA. Once a franchisor has been found to "operate" a place of public accommodation, it cannot escape responsibility for compliance with the Act by allocating responsibility to the franchisee. In the enforcement of the Fair Housing Act, courts have held that even if a property owner has delegated the duty not to discriminate, through contract or otherwise, to a rental agent or management company, the property owner is still liable for discrimination under the Fair Housing Act because his duty not to discriminate is nondelegable. See, e.g., Walker v. Crigler, 976 F.2d 900 (4th Cir. 1992); Asbury v. Brougham, 866 F.2d 1276, 1280 n.4 (10th Cir. 1989); Marr v. Rife, 503 F.2d 735, 741 (6th Cir. 1974). This is so because the overriding societal purpose of the fair housing law takes priority over the terms of a contract. Walker, 976 F.2d at 904-905. Likewise, the overriding remedial 01-07413 - 18 - purpose of the ADA warrants the interpretation that, to the extent that ADQ retains control over the structure and function of individual stores, to that extent it is an operator of the stores within the meaning of the ADA and must comply with its nondiscrimination requirements. For purposes of the ADA, the fact that ADQ does not own the premises and is not present in the stores day-to-day is irrelevant, since the statute applies equally to those who "operate[]" places of public accommodation. CONCLUSION For the foregoing reasons, the judgment of the district court should be vacated and remanded. Respectfully submitted, DEVAL L. PATRICK Assistant Attorney General (Signature) JESSICA DUNSAY SILVER MARIE K. McELDERRY Attorneys Department of Justice P.O. Box 66078 Washington, D.C. 20035-6078 01-07414 CERTIFICATE OF SERVICE I hereby certify that on October 18, 1994, I served two copies of the foregoing Brief for the United States as Amicus Curiae by first-class mail postage paid on: Pamela Breed Bonavita Geoffrey Courtney Advocacy, Incorporated 434 South Main, Suite 300 San Antonio, Texas 78204-1117 James C. Harrington 7800 Shoal Creek Blvd., Suite 171-E Austin, Texas 78757 Joseph M. Harrison IV Haynes and Boone, L.L.P. 112 East Pecan Street - Suite 1600 San Antonio, Texas 78205-1540 William L. Killion Troy A. Bader Gray, Plant, Mooty, Mooty & Bennett, P.A. 3400 City Center 33 South Sixth Street Minneapolis, Minnesota 55402 (Signature) Marie K. McElderry Attorney 01-07415 NEFF v. AMERICAN DAIRY QUEEN CORP. 4746 Margo NEFF, for herself and those similarly situated, Plaintiff-Appellant, v. AMERICAN DAIRY QUEEN CORPORATION, Defendant- Appellee. No. 94-50552. United States Court of Appeals, Fifth Circuit. July 20, 1995. Disabled customer brought action against restaurant franchisor, alleging viola- tion of Americans with Disabilities Act (ADA). The United States District Court for the Western District of Texas, Edward C. Prado, J., granted franchisor's motion for summary judgment, 879 F.Supp. 57, and customer appealed. The Court of Appeals, Emilio M. Garza, Circuit Judge, held that restaurant franchisor's right under franchise agreement to set standards for building and equipment maintenance and to "veto" pro- posed structural changes did not make it "operator" of restaurant for purposes of ADA's prohibition on discrimination in public accommodations. Affirmed. 1. Federal Civil Procedure key2491.5 Whether franchise agreement made res- taurant franchisor "operator" of franchised restaurants for purposes of ADA claim was question of law that could be resolved through summary judgment. Americans with Disabilities Act of 1990, S 302, 42 U.S.C.A. S 12182; Fed.Rules Civ.Proc.Rule 56(c), 28 U.S.C.A. 2. Civil Rights key107(2) Restaurant franchisor's right under franchise agreement to set standards for building and equipment maintenance and to "veto" proposed structural changes did not make it "operator" of restaurant for purposes of ADA's prohibition on discrimination in public accommodations. Americans with Disabilities Act of 1990, S 302(a), 42 U.S.C.A. S 12182(a) See publication Words and Phrases for other judicial constructions and def- initions. 3. Civil Rights key107(2) In determining whether franchisor "op- erates" franchise for purposes of ADA's pro- hibition on discrimination in public accommo- dations, relevant inquiry is whether franchi- sor specifically controls modification of fran- chises to improve their accessibility to the disabled. Americans with Disabilities Act of 1990, S 302(a), 42 U.S.C.A. S 12182(a). 4. Civil Rights key107(2) Restaurant franchisor's right to control numerous nonstructural aspects of franchised restaurants' operations, such as accounting, personnel uniforms and use of trademarks was irrelevant to question of whether fran- chisor "operated" franchises for purposes of ADA's prohibition on discrimination in public accommodations; relevant inquiry was whether franchisor, according to terms of franchise agreement, controlled moficiation comply with ADA. Americans with Disabili- ties Act of 1990, S 302(a), 42 U.S.C.A. S 12182(a). 5. Civil Rights key120 Civil Rights Act did not apply in deter- mining whether restaurant franchisor was Synopsis, Syllabi and Key Number Classification COPYRIGHT 1995 by WEST PUBLISHING CO. The Synopsis, Syllabi and Key Number Classifi- cation constitute no part of the opinion of the court. 01-07416 "operator" of franchises for purposes of ADA. Civil Rights Act of 1964, S 201 et seq., 42 U.S.C.A. S 2000a et seq.; Americans with Disabilities Act of 1990, S 308(a)(1), 42 U.S.C.A. S 12188(a)(1). Appeal from the United States District Court for the Western District of Texas. Before REAVLEY, GARWOOD and EMILIO M. GARZA, Circuit Judges. EMILIO M. GARZA, Circuit Judge: Margo Neff appeals from the district court's entry of summary judgment on her claims against American Dairy Queen Corpo- ration ("ADQ") under the Americans with Disabilities Act, 42 U.S.C. SS 12101-12213 (West Supp.1995) ("ADA"). We affirm. I ADQ owns the federally registered "Dairy Queen" trade name and various trademarks and service marks used in connection with the operation of licensed Dairy Queen stores. ADQ, through franchise agreements with franchisees throughout the United States, li- censes franchisees to establish and operate Dairy Queen retail stores. Among those franchisees is R & S Dairy Queens, Inc., a Texas corporation that owns two Dairy Queen stores in San Antonio, one located at 13122 Nacogdoches (the "Nacogdoches Store"), and the other located at 9726 Perrin Beitel (the "Perrin Beitel Store") (collective- ly, the "San Antonio Stores"). Margo Neff is disabled and requires a wheelchair to gain mobility. Neff filed suit under section 308 of the ADA, 42 U.S.C. S 12188(a) (1988), alleging that ADQ had vio- lated section 302 of the ADA, 42 U.S.C. S 12182, by failing to make the San Antonio Stores accessible to her.1 In her complaint Neff pointed to numerous barriers that she alleged made the San Antonio Stores inacces- sible to the disabled. Neff sought an injunc- tion requiring ADQ to modify "its"2 San Antonio Stores to eliminate the alleged barri- ers, a declaratory judgment concerning ADQ's violation of the ADA, and attorneys fees.3 ADQ moved for summary judgment on the grounds that it did not own, lease, or operate the San Antonio Stores and therefore was not responsible for removing the alleged bar- riers. Its summary judgment pleadings in- cluded an affidavit by ADQ's Vice President for Franchise Operations stating that ADQ neither owned nor operated the San Antonio Stores. ADQ also offered copies of the fran- chise agreements between ADQ and R & S Dairy Queens relating to the San Antonio 1. Section 302(a) provides that "[n]o individu- al shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, ad- vantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation." 42 U.S.C. S 12182(a). Section 302(b)(2)(A)(iv) further provides that such discrimination includes the "failure to remove architectural barriers, and communication barriers that are structural in nature, in existing facilities, ... where such removal is readily achievable." 42 U.S.C. S 12182(b)(2)(A)(iv). 2. In her complaint, Neff alleged that ADQ "owns" the San Antonio Stores. 3. Neff also sought certification of a class of disabled consumers who were unable to ac- cess the San Antonio Stores. Neff later filed a motion for class certification, which the district court denied as moot when it granted ADQ's motion for summary judgment. Neff makes no argument regarding class certifica- tion on appeal. 01-07417 Stores. According to ADQ, the agreements established as a matter of law that it did not "operate" the stores within the meaning of section 302. In response, Neff contended that the terms of the franchise agreement between ADQ and R & S Dairy Queens regarding the Nacogdoches Store supported her claim that ADQ retained sufficient control over the op- eration of the San Antonio Stores to make it an "operator" of the stores for the purposes of section 302. The district court granted summary judg- ment, see Neff v. American Dairy Queen, Inc., 879 F.Supp. 57 (W.D.Tex.1994), conclud- ing that the Nacogdoches Store franchise agreement established no more than that ADQ held the power to veto modifications to the store's facilities, and that this amount of control was insufficient to bring ADQ within the scope of section 302. Neff appeals from the district court's entry of summary judg- ment, contending that the existence of genu- ine issues of material fact regarding whether ADQ "operates" the San Antonio Stores should have precluded summary judgment on her ADA claims.4 II We review a district court's grant of sum- mary judgment de novo, applying the same standard as did the district court. McDaniel v. Anheuser-Busch, Inc., 987 F.2d 298, 301 (5th Cir.1993). We "review the facts draw- ing all inferences most favorable to the party opposing the motion." Reid v. State Farm Mut. Auto. Ins. Co., 784 F.2d 577, 578 (5th Cir.1986). Summary judgment is appropri- ate when the summary judgment record demonstrates "that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); accord Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202 (1986); Fraire v. City of Arlington, 957 F.2d 1268, 1273 (5th Cir.1992), cert. denied, -- U.S. --, 113 S.Ct. 462, 121 L.Ed.2d 371 (1992). "If the moving party meets the ini- tial burden of showing that there is no genu- ine issue of material fact, the burden shifts to the non-moving party to produce evidence or designate specific facts showing the existence of a genuine issue for trial." Engstrom v. First Nat'l Bank, 47 F.3d 1459, 1462 (5th Cir.1995), petition for cert. filed, 63 U.S.L.W. 3892 (U.S. June 12, 1995) (No. 94-2025). A [1] Neff argues that summary judgment was inappropriate in this case because genu- ine issues of material fact exist regarding ADQ's control over the restaurants in ques- tion. This argument raises the question of whether the issue that Neff and ADQ dispute is one of fact or one of law.5 The only issue in dispute between the parties is whether ADQ's contractual rights under the Nacogdo- ches Store franchise agreement demonstrate that ADQ "operates" the San Antonio Stores. Neff's only summary judgment evidence, and the only basis for her claim that ADQ "oper- ates" the San Antonio Stores, is the Nacog- doches Store franchise agreement, and "[t]he interpretation of an unambiguous contract is a question of law" which we review de novo. Exxon Corp. v. Crosby-Mississippi Re- 4. The United States has filed an amicus curiae brief supporting Neff's position, and the Inter- national Franchise Association has filed an amicus curiae brief supporting ADQ's posi- tion. 5. The United States specifically argues that the question is one of fact. 01-07418 4749 NEFF v. AMERICAN DAIRY QUEEN CORP. sources, Ltd, 40 F.3d 1474, 1481 (5th Cir. 1995). Neff has not alleged that the Nacog- doches Store franchise agreement is ambigu- ous. Indeed, the parties do not dispute the meaning of the terms of the agreement at all; rather, they dispute whether the control provided for in the agreement makes ADQ an "operator" of the store for the purposes of section 302, again a question of law which we review de novo. See Matagorda County v. Russell Law, 19 F.3d 215, 217 (5th Cir.1994) ("We review the district court's legal deci- sions, including the proper interpretation of a statute, de novo."). Consequently, we hold that because the disputed issue in this case is purely legal, it was appropriately resolved through summary judgment.6 B [2] Neff's appeal thus presents a narrow- ly defined issue of first impression: whether a franchisor with limited control over a fran- chisee's store "operates a place of public accommodation" within the meaning of sec- tion 302(a).7 Section 302(a) provides in perti- nent part that "[n]o individual shall be dis- criminated against on the basis of disability in the full and equal enjoyment of ... [t]he facilities ... or accommodations of any place of public accommodation by any person who owns, leases (or leases to),[8] or operates a place of public accommodation." (emphasis added). Because the ADA does not define the term "operates," we "construe it in ac- cord with its ordinary and natural meaning, see Smith v. United States, -- U.S. --, ILLEGIBLE S.Ct. 2050, 2054, 124 L.Ed.2d 138 (1993); see also Perrin v. United States, 444 U.S. 37, ILLEGIBLE 100 S.Ct. 311, 314, 62 L.Ed.2d 199 (1979) ("a fundamental canon of statutory construction is that, unless otherwise defined, words will be interpreted as taking their ordinary, con- temporary, common meaning."). To "oper- ate," in the context of a business operation means "to put or keep in operation," The Random House College Dictionary 931 (ILLEGIBLE ed. 1980), "[t]o control or direct the function- ing of," Webster's II: New Riverside Univer- sity Dictionary 823 (1988), "[t]o conduct the affairs of; manage," The American Heritage Dictionary 1268 (3d ed. 1992). 6. In support of her argument that the exis- tence of genuine issues of material fact should have precluded the district court from render- ing summary judgment, Neff cites Drexel v. Union Prescription Centers, Inc., 582 F.2d 781 (3d Cir.1978). In Drexel, the Third Circuit applied the Rule 56(c) summary judgment standard to an issue of state agency law that involved an interpretation of a franchise agreement. A wrongful death plaintiff con- tended that the franchisor exercised sufficient control over the franchisee retail store such that it "operated" the store, thus rendering the franchisor potentially liable for the torts of its franchisee. The court treated the ques- tion of whether the franchise agreement cre- ated an agency relationship as one of fact and interpreted the agreement in the light most favorable to the nonmovant. See id. at 788- 89. Although the court's reasoning is not entirely clear, the court did hold that the franchise agreement was ambiguous, id. at 788, raising the factual issue of what the parties intended it to mean, id. In any event to the extent that Drexel is inconsistent with our holding in this case, we decline to follow its reasoning. Neff also cites two state cases in support of her argument that material facts precludes summary judgment: Singleton v. Internation- al Dairy Queen, Inc., 332 A.2d 160 (Del.Su- per.Ct.1975), and American Dairy Queen Corp. v. Taxation & Revenue Department, 93 ILLEGIBLE 743, 605 P.2d 251 (Ct.App.1979). Neither case relates to ADA liability or applies the federal standard for summary judgment, how- ever, and we decline to follow them. 7. The parties do not dispute that the San Antonio Stores are places of public accommo- dation. 8. The parties agree that ADQ does not own the premises in question or lease them to R & S Dairy Queens. 01-07419 NEFF v. AMERICAN DAIRY QUEEN CORP. 4750 [3] Neff argues that the terms of the Nacogdoches Store Franchise Agreement demonstrate that ADQ exercises sufficient control over the San Antonio Stores to bring ADQ within the scope of section 302. We hold that the relevant inquiry in a case such as this one is whether ADQ specifically con- trols the modification of the franchises to improve their accessibility to the disabled. Cf. Carparts Distribution Center, Inc. v. Au- tomotive Wholesalers' Ass'n, 37 F.3d 12, 16- 18 (1st Cir.1994) (interpreting "employer" as used in Title I of ADA by looking to defen- dant's control over allegedly discriminatory denial of employee benefits). Although we have found no circuit court of appeals case law interpreting the scope of "operates" as used in S 302 of the ADA, the existing dis- trict court authority is consistent with our approach. All three district courts that have addressed the question of ADQ's liability for allegedly discriminatory conditions at fran- chisee stores have concluded that ADQ does not "operate" the stores for the purposes of S 302, and all three looked to ADQ's authori- ty over structural modifications to the fran- chisee stores in reaching their conclusions. See Young v. American Dairy Queen, Inc., 1994 WL 761233, *2 (N.D.Tex.1994); Neff v. American Dairy Queen, Inc., 879 F.Supp. 57, 60 (W.D.Tex.1994); Alonzo v. Bayside Res- taurant Co., C.A. No. C-94-103, slip op. at 4 (S.D.Tex.1994).9 [4] Neff and the United States point to numerous non-structural aspects of the San Antonio Stores' operations that they contend ADQ controls, such as accounting, personnel uniforms, use of trademarks, etc. While ADQ's control over these aspects may be relevant in other contexts, we hold that be- cause it does not relate to the allegedly dis- criminatory conditions at the San Antonio Stores, it does not bear on the question of whether ADQ "operates" the franchises for the purposes of the ADA's prohibition on discrimination in public accommodations. Instead, the relevant question in this case is whether ADQ, according to the terms of its franchise agreements with R & S Dairy Queens, controls modification of the San An- tonio Stores to cause them to comply with the ADA. Neff points to the following language in the Nacogdoches Store franchise agreement to support her position that ADQ controls the San Antonio stores:10 B. Company makes available to its licen- sees a system to establish, equip and oper- 9. In addition, two district courts have inter- preted "operates" in the context of hospital operations consistently with our approach to the question in the context of franchise store operations. In Howe v. Hull, 873 F.Supp. 72 (N.D.Ohio 1994), the court held that a physi- cian "operated" a hospital because he exer- cised sole discretion over the allegedly dis- criminatory decision not to admit a patient with AIDS. The court specifically focused on the physician's authority over the allegedly discriminatory act. Id. at 77-78. In Aikins v. St. Helena Hosp., 843 F.Supp. 1329 (N.D.Cal. 1994), the court held that a physician who worked at a hospital as an independent con- tractor did not "operate" the hospital in ques- tion. The plaintiff in Aikins, the deaf wife of an emergency room patient, complained that the hospital had discriminated against her by failing to provide her with an interpreter. The court held that the physician defendant did not "operate" the hospital because, as an independent contractor, he exercised no au- thority over the hospital's policy on the use of interpreters. Id. at 1335. 10. Neff has not identified, either below or on appeal, any language in the Perrin Beitel Store franchise agreement to support her claim that ADQ "operates" the Perrin Beitel Store. The Perrin Beitel Store franchise agreement is more limited in scope than the Nacogdoches Store agreement, and it con- tains none of the provisions to which Neff points in support of her argument regarding ADQ's control over the Nacogdoches Store. 01-07420 4751 NEFF v. AMERICAN DAIRY QUEEN CORP. ate a retail store facility as part of the "Dairy Queen" system using distinctive, uniform and approved designs, equipment, supplies ... which Licensee desires to adopt and use to operate a "Dairy Queen" retail store ... in accordance with this Agreement and the system standards and requirements established and periodically revised by the Company.... 5.1 The retail Store shall be constructed and equipped in accordance with Compa- ny's approved specifications and standards in effect at the time pertaining to design and layout of the building, and as to equip- ment, inventory, signage, fixtures, location and design and accessory features. Licen- see shall not commence construction of the Store until he has received the written consent of Company to his building plans. 5.2 Any replacement, reconstruction, ad- dition or modification in building, interior or exterior decor or image, equipment or signage, to be made after Company's con- sent is granted for initial plans, whether at the request of Licensee or of Company, shall be made in accordance with written specifications which have received the pri- or written consent of Company, which shall not be unreasonably withheld. 5.3 The building, equipment and signage employed in the conduct of Licensee's business shall be maintained in accordance with requirements established periodically by Company, or reasonable, specific lists prepared by Company based upon periodic inspections of the premises by Company's representatives. Within a period of ninety (90) days after the receipt of any particular maintenance list, Licensee shall effect the items of maintenance designated therein including the repair of defective items and/or the replacement of unrepairable or obsolete items of equipment and signage. Routine maintenance shall be conducted in accordance with general schedules publish- ed by Company. 6.7 Licensee shall adopt and use as his continuing operational routine the stan- dard "Dairy Queen" management system as prescribed in the Store Management Operations Manual, including Company standards with respect to product prepara- tion, merchandising, employee training, equipment and facility maintenance and sanitation. Company will revise the Manu- al and these programs periodically to meet changing conditions of retail operation in the best interest of "Dairy Queen" retail stores.... Record on Appeal, vol. 1, at 193-86. Howev- er, we agree with the district court that the language does not establish sufficient ILLEGIBLE on ADQ's part such that ADQ can be said ILLEGIBLE "operate" the San Antonio stores. Para- graph B is simply a general statement re- garding the purpose of the agreement, and even it makes clear that R & S Dairy Queen, not ADQ, will "operate" the store. Para- graph 5.1 provides for the greatest level ILLEGIBLE control over the accessibility of the Nacogdo- ches Store to the disabled, but it relates ILLEGIBLE the construction of the store, and it is undis- puted that the Nacogdoches store was con- structed and equipped before the ADA was enacted. Consequently, even if ADQ "oper- ated" the store with respect to its construc- tion, such operation is irrelevant because the issue in Neff's case is whether ADQ "oper- ates" the San Antonio Stores with respect ILLEGIBLE the removal of existing architectural barriers. In addition, ADQ's pre-ADA control over the San Antonio Stores cannot form the basis ILLEGIBLE Neff's discrimination claim because the ADA is not to be given retroactive effect. See Burfield v. Brown, Moore & Flint, Inc., ILLEGIBLE F.3d 583, 588 (5th Cir.1995) (holding ILLEGIBLE employment discrimination claim was barred because "[t]he ADA is not retroactive and 01-07421 NEFF v. AMERICAN DAIRY QUEEN CORP. 4752 does not apply to actions allegedly taken prior to the effective date of the Act"). Paragraph 5.2, the only paragraph that relates to modifications to the structure of the Nacogdoches Store, simply provides that ADQ may disapprove any proposed modifica- tions to the Nacogdoches Store building and equipment. While this does amount to a limited form of control over structural modi- fications, we agree with the district court that this right, which is essentially negative in character, cannot support a holding that ADQ "operates" the Nacogdoches Store with respect to its removal of architectural barri- ers to the disabled. We note that Neff has not alleged or offered any summary judg- ment evidence to show that ADQ has with- held its consent to proposed modifications to the Nacogdoches Store designed to bring it into compliance with the ADA. In its brief, Neff specifically emphasizes paragraphs 5.3 and 6.7. paragraph 5.3 re- fers to building and equipment maintenance and not the modification of the store struc- ture or removal of architectural barriers. ADQ's control in this regard, while more relevant than its control over employee uni- forms, accounting standards, etc., is not di- rectly relevant to the Neff's suit. Neff's complaint is not based on R & S's failure to perform maintenance on the Nacogdoches Store building or equipment; rather, she complains of the equipment itself. Further, while Paragraph 5.3 does provide that such maintenance must be conducted in accor- dance with ADQ-established maintenance lists, Neff has not alleged, or offered any summary judgment evidence to show, that these lists prevent R & S from modifying the Nacogdoches Store to bring it into compli- ance with the ADA. Paragraph 6.7 states that R & S must adhere to the routine prescribed by ADQ's "Store Management Operations Manual," through which ADQ sets standards for "product preparation, merchandising, em- ployee training, equipment and facility main- tenance and sanitation." The effect of this provision is similar in kind to the effect of Paragraph 5.3. It does not relate to the modification of the physical structure or ac- cessibility of the Nacogdoches Store, and Neff has not alleged or offered summary judgment to show that the Store Manage- ment Operations Manual prevents R & S Dairy Queens from making such modifica- tions.11 In sum, while the terms of the Nacogdo- ches Store franchise agreement demonstrate that ADQ retains the right to set standards for building and equipment maintenance and to "veto" proposed structural changes, we hold that this supervisory authority, without more, is insufficient to support a holding that ADQ "operates," in the ordinary and natural meaning of that term, the Nacogdoches Store.12 11. At oral argument, Neff also pointed to paragraphs 11.1 and 11.2 of the agreement, which allow ADQ to terminate the agreement in case of breach. The right to terminate, however, does not grant ADQ additional con- trol over the modification of the Nacogdoches Store to increase its accessibility to the dis- abled beyond ADQ's underlying contractural rights with respect to such modifications. 12. We note that a recent Second Circuit case may suggest a disagreement with our reason- ing. In Staron v. McDonald's Corp., 51 F.3d 353 (2d Cir.1995), the court addressed the question of whether a ban on smoking was a "reasonable accommodation" required by the ADA. See 42 U.S.C. S 12182(b)(2)(A)(ii). In that case, the plaintiffs sued McDonald's Cor- poration and Burger King Corporation alleg- ing that the two corporations' policies of per- mitting smoking in "their" restaurants violat- ed the ADA. The plaintiffs sought an injunc- tion requiring the defendants to "establish a policy of prohibiting smoking in all of the 01-07422 4753 NEFF v. AMERICAN DAIRY QUEEN CORP. Because Neff rested her claim that ADQ "operates" the San Antonio stores exclusively on the terms of the Nacogdoches Store fran- chise agreement, and did not allege that ADQ has prevented R & S Dairy Queens from complying with the ADA, either as a practical matter or by exercising its rights under its franchise agreements,13 we hold that ADQ met its burden under Rule 56(c) in its motion for summary judgment. ADQ es- tablished the absence of a genuine issue of material fact and further that it was entitled to judgment as a matter of law based on the terms of its franchise agreements with R & S Dairy Queens. Because Neff offered no summary judgment evidence other than the Nacogdoches Store franchise agreement in response to ADQ's motion, we further hold that Neff's summary judgment evidence was insufficient to raise a genuine issue for trial. Neff and the United States argue that to exclude ADQ from the scope of section 302(a0 would be inconsistent with the canon of con- struction requiring courts to interpret civil rights statutes liberally to effectuate their remedial purposes. See, e.g., Gates v. Col- lier, 616 F.2d 1268, 1275 (5th Cir.1980)(lib- erally interpreting Civil Rights Attorneys Fee Awards Act), rehearing granted in ILLEGIBLE on other grounds, 636 F.2d 942 (5th Cir. 1981); United States v. DeRosier, 473 F.2d 749, 751 (5th Cir.1973) (liberally interpreting Civil Rights Act of 1964). Even assuming the canon applies in this context, we hold that Neff's interpretation of the term "oper- ates" would require more than just a liberal in this case would require us to bend "oper- ates" too far beyond its natural meaning for us to rely on the canon of statutory interpre- tation requiring that we interpret civil rights legislation liberally.14 Furthermore, we fail to see how our inter- pretation of "operates" to exclude ADQ un- der the circumstances involved in this case will interfere with the remedial purposes of the ADA. Assuming conditions at the San Antonio stores do not comply with the ADA it is Neff's decision not to sue the owner and operator of those stores, R & S Dairy Queens, that will prevent her from obtaining facilities they own, lease or operate." Staron, 51 F.3d at 355. In its opinion, the Second Circuit alludes to an earlier disposition of a motion by McDonald's Corporation: On the same day that the district court granted the motions to dismiss, McDonald's announced a new policy prohibiting smok- ing in all of its corporate owned-and-oper- ated restaurants. The smoking ban did not extend to its franchised restaurants. Mc- Donald's then submitted a motion to this court to dismiss plaintiffs' appeal as moot. This court denied the motion on June 21, 1994. Id. However, the court did not state on what grounds McDonald's policy change did not render the case moot, and the court's opinion contains no further discussion regarding the propriety of holding McDonald's responsible for the smoking policy at the franchisee res- taurants. 13. As we noted above, Neff does not contend that ADQ has prevented R & S Dairy Queens from removing architectural barriers by refus- ing to approve modifications to the restau- rants or promulgating a policy preventing such modifications. Indeed, ADQ offered nu- merous exhibits documenting its efforts to encourage franchisees to comply with the ADA. 14. Cf. EEOC v. AIC Security Investigations, Ltd., 55 F.3d 1276, 1281-82 (7th Cir.19 ILLEGIBLE) ("We do not doubt that the employment dis- crimination statutes have broad remedial pur- poses and should be interpreted liberally, ILLEGIBLE that cannot trump the narrow, focused con- clusion we draw from the structure and ILLEGIBLE of the statute. A liberal construction does not mean one that flies in the face of the structure of the statute."). 01-07423 NEFF v. AMERICAN DAIRY QUEEN CORP. 4754 the injunction she seeks.15 [5] Neff also argues that because "a fran- chisor is held responsible under the Civil Rights Act, a franchisor is held responsible under the ADA." This argument fails on several levels. First, it depends on Neff's premise that "the Title III [of the ADA] rights and remedies are the same as those rights and remedies available under the Civil Rights Act of 1964." However, the statutory provision Neff cites for this proposition states only that the remedies available under the ADA shall be the same as the remedies available under the Civil Rights Act. See 42 U.S.C. S 12188(a)(1). Second, because the Civil Rights Act does not define the scope of defendants who may potentially be liable with reference to who "operates" a public accommodation, Civil Rights Act cases are unlikely to be informative on the meaning of that term. Third, the two cases on which Neff relies to argue that franchisors "are liable" under the Civil Rights Act, Wheeler v. Hurdman, 825 F.2d 257 (10th Cir.1987), cert. denied, 484 U.S. 986, 108 S.Ct. 503, 98 L.Ed.2d 501 (1987), and Bradley v. Pizzaco, 7 F.3d 795 (8th Cir.1993), are factually distin- guishable.16 III For the foregoing reasons, we AFFIRM the district court's order granting ADQ's mo- tion for summary judgment. 15. Because Neff seeks only injunctive relief, it is curious why Neff elected to name ADQ rather than R & S Dairy Queens, the more logical defendant to an ADA suit over the accessibility of the San Antonio Stores. How- ever, the answer may lie in SS 302(b)(2)(A)(iv) and 301(9)(C) of the ADA, 42 U.S.C. SS 12182(b)(2)(A)(iv), 12181(9)(C). Section 302(b)(2)(A)(iv) defines discrimination in pub- lic accommodations to include "a failure to remove architectural barriers, and communi- cation barriers that are structural in nature, in existing facilities, ... where such removal is readily achievable." 42 U.S.C. S 12182(b)(2)(A)(iv). Section 301(9)(C), in turn, defines "readily achievable" as follows: The term "readily achievable" means easily accomplishable and able to be carried out without much difficulty or expense. In de- termining whether an action is readily achievable, factors to be considered in- clude- (B) the overall financial resources of the covered entity.... 42 U.S.C. S 12181(9)(C). Consequently, the scope of the injunctive relief available to Neff if she proves a violation of the ADA will depend in part on the financial strength of the defendant against which she proceeds. Still, while our holding excluding ADQ from the scope of S 302 with respect to the San Antonio Stores may limit the actual relief available to Neff, it will not hurt her ability to compel R & S Dairy Queens to make "readily available" structural changes to the San Anto- nio stores. 16. In Wheeler, the Tenth Circuit held that a general partner was not an "employee" with- in the meaning of Title VII, the ADEA, and the Equal Pay Act. id. at 277 ("For the reasons stated above, we hold that bona fide general partners are not employees under the Anti-Discrimination Acts."). The only issue before the court in Bradley was whether the defendants had established a business justifi- cation defense for enforcing an allegedly dis- criminatory "no beard" policy. One of the defendants was a franchisor, Domino's Pizza, Inc., but the court did not address the basis for Domino's liability under Title VII. How- ever, the court's recitation of the facts demon- strates that the allegedly discriminatory "no beard" policy was "established nationwide by [t]he franchisor, Domino's Pizza, Inc.," id. at 796, and thus was a direct result of an affir- mative act by the franchisor. Adm. Office, U.S. Courts--West Publishing Company, Saint Paul, Minn. 01-07424