SUPREME COURT WATCH

By Edward J. Sullivan

Edward J. Sullivan is a member of the Portland, Oregon, firm of Garvey Schubert Barer and Chair-Elect of the Section.

Second Bite of the Takings Apple Rejected

San Remo Hotel, L.P. v. City and County of San Francisco, 125 S. Ct. 2491 (2005), involved plaintiffs’ efforts to have the same takings claim relitigated in federal court, following an adverse decision in a California state court. Plaintiffs are individuals and a hotel corporation wishing to convert their single room occupancy (SRO) facility to a tourist commercial use. Defendant required a “conversion fee” of $560,000 to offset the loss of the transient occupancy capacity. Plaintiffs’ challenge was unsuccessful in state court, and they then asked a federal court to exempt the case from the “full faith and credit” requirements of 28 U.S.C. § 1738 so as to allow the federal constitutional claims to be heard anew. The case involves an argument that arose after Williamson County Regional Planning Commission v. Hamilton Bank, 473 U.S. 172 (1985), in which the Court found no taking claim ripe until a state fails to provide adequate compensation for the taking. Plaintiffs argued that they had no realistic chance of their federal claim ever being heard by a federal court on the merits. When it granted certiorari, the Supreme Court noted that the Second Circuit came to a different conclusion in Santini v. Connecticut Hazardous Waste Management Service, 342 F.3d 118 (2d Cir. 2003).

Plaintiffs originally filed a state court action, and then stayed it pending resolution of their federal court challenge, inter alia, on facial and as applied takings grounds. Defendant obtained summary judgment in the federal district court. Plaintiffs then appealed the summary judgment to the Ninth Circuit but asked that that court abstain on the federal claims so that the state courts could resolve them. The Ninth Circuit abstained on the facial, but not the as applied, takings claim, and affirmed the district court’s adverse decision against plaintiffs. The district court had found that the as applied claim was not ripe as plaintiffs had not sought compensation in state court, but suggested plaintiffs reserve their federal claims in state court. Plaintiffs tried to do just that, but also raised other takings claim, i.e., that the ordinance failed “to substantially advance” a legitimate state interest and was not roughly proportional to the impact of the conversion. The state trial court found for plaintiffs on the “rough proportionality” ground, but the California Supreme Court reversed in a split decision. That court also analyzed the takings claims under the California constitutional provisions involving takings. It held that it was construed consistently with federal takings jurisprudence and found that California courts interpret the similar wording of its state constitutional provisions on takings consistent with the federal Takings Clause. The California Supreme Court found the fee to be imposed legislatively and was, thus, not subject to the heightened scrutiny of Nollan and Dolan, finding that such a fee passed a “reasonable relationship” test. Plaintiffs did not seek certiorari to the U.S. Supreme Court of this decision, but instead returned to the federal district court, amending their original complaint to include various takings arguments. The federal district court found that both the statute of limitations and issue preclusion doctrines barred most of the new claims, especially under the full faith and credit statute noted above, as the California Supreme Court had interpreted the California takings clause co-extensively with the Fifth Amendment. The Ninth Circuit affirmed.

The full faith and credit statute follows Article IV, § 1, of the federal Constitution and has the effect of issue preclusion—i.e., issues may not be raised following a final judgment on the merits between the parties if those parties could have raised the issue. A narrow question for which certiorari was granted was whether the court should create an exception from the statute to provide a federal forum to litigate unripe claims before a state court has acted. Plaintiffs asserted they may reserve their federal claims under England v. Louisiana State Board of Medical Examiners, 375 U.S. 411 (1964), and that federal courts must decide such claims de novo regardless of the state court outcome. Justice Stevens’ majority opinion held that England involved situations in which a federal claim may be avoided if a state court construes a statute in a particular way. This reservation is distinguished from abstention in which a state court decision on the merits may moot the federal controversy. However, a condition for a reservation is that the parties not attempt to broaden the state court decision beyond the state law issues. On the other hand, abstention in this case is to allow a state court determining the law in sensitive policy areas such as land use so that the federal courts abstained in the facial claim in this case, but not the as applied claim. In broadening their claims to include as applied claims in state court “petitioners effectively asked the state court to resolve the same federal issues they asked it to reserve.” Moreover, the Ninth Circuit did not abstain from the as applied claim, but found it unripe, and affirmed dismissal of this claim, which then never came before the Ninth Circuit to reserve in the first place.

The court also rejected the Second Circuit dicta in Santini as it found no inherent right to litigate these federal claims in a federal forum. The issue was whether a state court had decided an issue of fact or law that was necessary to its judgment. In this case, a state court actually decided both the facial and as applied claims adversely to plaintiffs. In this context, the fact that plaintiffs originally filed in federal court was of no significance. Moreover, the court said it could not create exemptions to federal statutory law by judicial fiat, especially when comity and finality interests dictated otherwise. Finally, the court stated plaintiffs overstated the requirements of Williamson County—which never required that facial claims be presented to state courts first, so that those claims could have been raised in federal court or, alternatively, plaintiffs could have reserved them and litigated them in state court. The court added:

Petitioners did not have the right, however, to seek state review of the same substantive issues they sought to reserve. The purpose of the England reservation is not to grant plaintiffs a second bite of the apple in a forum of their choice.

125 S. Ct. at 2506.

For those claims requiring ripening, the court said Williamson County did not prevent federal claims from being presented to state courts so that one may join both a claim for compensation under state law and simultaneously claim that, if compensation be denied, it would violate the Fifth Amendment, so as to avoid piecemeal litigation. The court noted that most takings cases that come to the U.S. Supreme Court arise from the grants of certiorari rather than from appeals of a federal court decision and that state courts have much more experience in the land use planning area. The court concluded:

At base, petitioners’ claim amounts to little more than the concern that it is unfair to give preclusive effect to state-court proceedings that are not chosen, but are instead required in order to ripen federal takings claims. Whatever the merits of that concern may be, we are not free to disregard the full faith and credit statute solely to preserve the availability of a federal forum. The Court of Appeals was correct to decline petitioners’ invitation to ignore the requirements of 28 U.S.C. § 1738. The judgment of the Court of Appeals is therefore affirmed.

Id. at 2507.

Chief Justice Rehnquist and Justices O’Connor, Kennedy, and Thomas concurred in the judgment, expressing concern over a portion of the court’s opinion in Williamson County, i.e., that a final state or local government decision on the use of the property be secured before a taking claim goes to a state court, finding this outcome to be neither a constitutional nor a prudential requirement. The concurring opinion noted that the majority opinion relied, to some extent, on the bar on challenges to state taxation laws in federal courts under the Tax Injunction Act, 28 U.S.C. § 1341, as an analogy, but added that there was a history of federal nonintervention in state tax matters that did not find a parallel in takings cases. The concurring opinion noted that there were strong federal interests in allowing federal courts to determine federal issues involving states or their subdivisions, and that that interest was especially important with regard to First Amendment cases. The opinion also expresses unease over the viability of some litigants to be heard in federal court under the Rooker-Feldman doctrine, so that if a state court interprets the federal constitution consistently with the Fifth Amendment, issue preclusion applies. The concurring opinion would, thus, reconsider Williamson County in a future case; however, under the facts of this case, the Ninth Circuit decision was correct.

The decision in this case was unanimous, probably because all of the members of the court were satisfied that plaintiffs were fully heard and were less sympathetic due to their maneuvering in lower courts. However, there is an issue over the viability of the second prong of Williamson County that must be resolved in some future case, i.e., whether there is a right to have a federal takings claim resolved by federal court de novo. The fault line for these arguments runs through the current court and can be expected to be more pronounced when the personnel on the court change.

San Remo Hotel, LP v. City and County of San Francisco, 125 S. Ct. 2491 (2005).

RLUIPA Upheld on Facial Challenge in Prison Setting

Cutter v. Wilkinson, 125 S. Ct. 2113 (2005), involved the constitutionality and validity of the Religious Land Use and Institutionalized Persons Act (RLUIPA) of 2000 in an Ohio correctional facility setting. Plaintiffs are practitioners of “non-mainstream religions” (Satanist, Wicca, Asatru, and a Christian Identity sect) who claim the state has denied them access to religious literature, group worship, and a chaplain. The parties have stipulated that plaintiffs are sincere in their religious beliefs. Defendant prisons officials mounted a facial challenge to RLUIPA, contending it violates the Establishment Clause. The Sixth Circuit found that RLUIPA was facially unconstitutional.

Speaking through Justice Ginsburg, the U.S. Supreme Court noted that there was room (“play in the joints”) between the Free Exercise and the Establishment Clauses for governments to maneuver without violating either standard and found that, on its face, RLUIPA violated neither clause. The court recounted the history of the Religious Freedom Restoration Act (RFRA) and its demise in a land use setting in City of Boerne v. Flores, 521 U.S. 507 (1997), and recounted the subsequent passage of RLUIPA.

According to a joint statement by the major proponents of RLUIPA, Senators Kennedy and Hatch, the Act was drawn to take down “frivolous or arbitrary barriers” to religious exercise. The U.S. magistrate in this case found no conflict with security functions at prisons on the record before the court and upheld the Act. The Sixth Circuit reversed, however, finding that the creation of a superior class of prisoners of religious faith over other prisoners violated the Establishment Clause.

The Supreme Court found a combination of religion not to be endorsement of religion and stated:

Foremost, we find RLUIPA’s institutionalized-persons provision compatible with the Establishment Clause because it alleviates exceptional government-created burdens on private religious exercise. . . . Furthermore, the Act on its face does not founder on shoals our previous decisions have identified: Properly applying RLUIPA, courts must take adequate account of the burdens of a requested accommodation may impose on nonbeneficiaries . . . and they must be satisfied that the Act’s prescriptions are and will be administered neutrally among different faiths. . . .

125 S. Ct. at 2121 (citations omitted).

The court went on to say that free exercise included not only belief but performance of physical acts, including religious assembly and worship, even in a tightly run government institution, but there must be accommodation between security and discipline on the one hand and religion on the other. The court added that it had no cause to believe that RLUIPA would not be applied in an appropriately balanced way and noted that the Act, as written, did not favor any particular religion. Specifically, the court said that religion was not favored or benefited as opposed to other belief systems. In this case, the Sixth Circuit could not have found the statute facially unconstitutional because it was possible to accommodate security along with religious exercise, noting that the federal prison system had done so for some years.

Footnote 3 specifically noted that the land use provisions of this Act were not at issue and pointedly did not address this area.

For those seeking a declaration as to the constitutionality and validity of RLUIPA at the state and local land use level, there was disappointment, but not surprise. The court steered away from an overly broad pronouncement and left the question of the validity and constitutionality of RLUIPA in the land use area for another day.

Cutter v. Wilkinson, 125 S. Ct. 2113 (2005).

Attorney Fees for Telecommunications Act Violation Denied

City of Rancho Palos Verdes v. Abrams, 125 S. Ct. 1453 (2005), involved a request for attorney’s fees and costs under the Federal Civil Rights Act, 42 U.S.C. § 1983, for a violation of the Federal Telecommunications Act (FTA). Plaintiff received a local approval for an amateur radio antenna in 1989, but unlawfully erected other antennas for personal and commercial use. When he later applied for a second antenna, the violations were detected and defendant city denied further applications on grounds of visual interference and not wishing to establish a precedent for the grant of such antennas. Plaintiff then sued in federal court over alleged violations of the FTA, 47 U.S.C. § 332(c)(7), and the court found the denial was not supported by substantial evidence because the scenic qualities of the area were already affected by the existing lawful antenna and the precedent ground would effectively prevent any antenna from being erected, frustrating the purpose of the FTA. That court ordered issuance of the local permits, but refused plaintiffs damages claim. The Ninth Circuit reversed, holding that both damages and attorney’s fees were possible. The U.S. Supreme Court granted certiorari.

Justice Scalia wrote for the majority, noting that the Federal Civil Rights Act created a cause of action over the deprivation of constitutional or statutory rights under federal law. But he went on to say that the Act concerned “rights” and not “benefits” or “interests.” Thus, a legally enforceable right was required and that right must have been intended by Congress to be enforceable under § 1983. That intention must be shown either directly in an enactment or inferred through a comprehensive enforcement scheme incompatible with individual enforcement. The court assumed the FTA allowed for enforcement rights by individuals, so Justice Scalia found the issue was whether this FTA remedy was meant to coexist with a civil rights remedy.

The majority opinion noted two cases in which a parallel and more restrictive remedy in a statutory scheme was found to preclude use of the Civil Rights Act as an enforcement mechanism. Justice Scalia said that the existence of a private remedy might evince a congressional intent to supplant the § 1983 remedy with a statutory remedy. However, he said the mere existence of a private remedy did not automatically mean that the § 1983 remedy could not be brought. In this particular case, Justice Scalia found that the FTA neither added remedies to those available under § 1983 nor limited relief in ways that § 1983 does not. According to Justice Scalia, the fact that the FTA requires proceedings to be filed within 30 days for cases to be heard “on an expedited basis,” that it does not specifically provide for damages, and that it does not provide for attorney’s fees were all significant. In the face of the detailed requirements for its appeals scheme under the FTA, as well as the lack of a damage remedy and attorney’s fee provisions, the Court found an inference that Congress had chosen not to allow recovery of attorney’s fees under the Civil Rights Act. In doing so, Justice Scalia’s opinion rejected the Ninth Circuit’s view that 47 U.S.C. § 152, which construed the provisions of the FTA not to impair any federal law, did not, by itself, create a cause of action under the Civil Rights Act because there were no nonstatutory rights before the FTA was passed and no cause of action, therefore, under the Civil Rights Act specifically created. The court noted that the use of a longer statute of limitations when § 1983 claims were made was inconsistent with the thirty-day period in which one might seek a remedy under the FTA, which indicated further that a Civil Rights Act remedy was not contemplated by Congress in enacting the FTA. The decision of the Ninth Circuit was, therefore, reversed.

Justice Breyer wrote for himself and three other Justices to emphasize rejection of the Department of Justice’s proposed rule that the existence of a private remedy would preclude a Civil Rights Act remedy and said that both the text and context of federal legislation must be examined. The concurring opinion also dwelt on the legislative history of the FTA, which, it indicated, must be examined in addition to the words of the legislation itself. This latter analysis was not compatible with Justice Scalia’s approach to statutory construction.

Justice Stevens concurred in the judgment, and made many of the same points about the presence of a statutory remedy not necessarily obviating a Civil Rights Act remedy and the need to look at the text and context of the statute. Justice Stevens would find the foreclosing of § 1983 remedies to be the exception, rather than the rule, and would consider legislative history. He attached great significance to congressional silence regarding attorney’s fees in the adoption of the FTA.

This case was not even close. All of the Justices found that Congress did not intend to allow Civil Rights Act remedies to enforce the FTA. Most of the decision centered on what was necessary to demonstrate that link.

City of Rancho Palos Verdes v. Abrams , 125 S. Ct. 1453 (2005).