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Color of law refers to an act done under the appearance of legal authorization, when in fact, no such right existed. It applies when a person is acting under real or apparent government authority. The term is used in the federal Civil Rights Act, which gives citizens the right to sue government officials and their agents who use their authority to violate rights guaranteed by federal law.
The following is from the Civil Rights Act:
"Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress."
Acting under color of [state] law is misuse of power, possessed by virtue of state law and made possible only because the wrongdoer is clothed with the authority of state law Thompson v. Zirkle, 2007 U.S. Dist. LEXIS 77654 (N.D. Ind. Oct. 17, 2007)