Nichols v. City of Rehobeth Beach et al

Filing 24

MEMORANDUM. Signed by Judge Gregory M. Sleet on 12/14/2015. (mdb)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
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JACKIE NICHOLS,
Plaintiff,
v.
CITY OF REHOBOTH BEACH,
SAM COOPER and SHARON LYNN,
Defendants.

C.A. No. 15-602 GMS

MEMORANDUM
I.

INTRODUCTION
The plaintiff Jackie Nichols ("Nichols") filed this complaint on July 16, 2015, against

defendants the City of Rehoboth Beach ("Rehoboth"), Mayor of Rehoboth Sam Cooper, and City
Manager of Rehoboth Sharon Lynn (collectively, "Defendants"). (D.I. 1.) Nichols alleges federal
and state constitutional violations arising from a .special election to authorize the issuance of
municipal bonds. (D.I. 1.) Nichols seeks declaratory and injunctive relief on behalf of herself and
the citizens of Rehoboth. Id. Currently before the court are the Defendants' motion to dismiss
and opening brief. (D.I. 10, 11.) For the reasons that follow, the court will grant Defendants'
motion to dismiss.

II.

BACKGROUND 1
Nichols is a resident, property owner, and

t~xpayer

of Rehoboth. (D.I. 1.) On- April 27,

2015, the Board of Commissioners of Rehoboth adopted a resolution proposing the issuance of up
to $52,500,000 general obligation bonds of Rehoboth to finance an ocean outfall project (the
"Ocean Outfall Project"), and ordering a Special Election to authorize the city to issue these and

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The background is drawn primarily from Nichols' complaint.

other objectives. (D.I. 9 at 2.) On June 27, 2015, Rehoboth conducted the "Special Election." Id
The costs of the Special Election were paid from the Rehoboth treasury. Id Section 40(h) of the
Rehoboth Charter, which governs voting procedures for Special Elections to authorize the
borrowing of money, states:
At the said Special Election, every owner or leaseholder, as defined in this Charter, of
property, whether an individual, partnership or corporation, shall have one vote and every
person who is a bona fide resident of the City of Rehoboth Beach, but who is not an owner
or leaseholder, as defined in this Charter, of property within the corporate limits of the City
of Rehoboth Beach and who would be entitled at the time of holding of the said Special
Election to register and vote in the Annual Municipal Election if such Annual Municipal
Election were held on the day of the Special Election shall have one vote whether or not
such person be registered to vote in the Annual Municipal Election.

Id at 3. Section 40 of the Rehoboth Charter does not define the phrase "bona fide resident." Id
Section 7(d) of the Rehoboth Charter, relating to the manner of holding annual elections, requires
that to be eligible to vote, the term "resident" means "an individual actually residing and domiciled
in the City of Rehoboth Beach for a period of 6 months immediately preceding the date of the
election." Id At the Special Election, Rehoboth only accepted as voters those who had been
residents for a minimum of six months and property owners. Id Rehoboth granted the right to
vote more than once to those who met the residency requirement and owned (directly or through
an entity) property in Rehoboth. Id Corporations and other artificial entities owning property in
Rehoboth were permitted to vote. Id at 4. Individuals who owned multiple parcels in Rehoboth
through ownership of multiple artificial entities were permitted to vote one time for each property
owned through such artificial entities. Id After the polls were closed, Rehoboth announced that
there were 637 votes in favor of borrowing for the Ocean Outfall Project, and 606 votes against
borrowing for the Ocean Outfall Project. Id

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On July 16, 2015, Nichols filed this action. (D.I. 1.) On July 30, Defendants filed a motion
to dismiss the Complaint and opening brief. (D.I. 6, 7.) On August 10, 2015, the parties entered
into a stipulation providing that Nichols would submit an amended complaint and Defendants
would withdraw their motion to dismiss. (D.I. 8.) Subsequently, on August 12, 2015, the court
approved the stipulation. (D.I. 9.)
Nichols' alleges violations under the Fourteenth Amendment and under§§ 1983 and 1988.
42 U.S.C. §§ 1983, 1988; U.S. Const. amend. XIV. The amended complaint contains four counts:
(1) declaratory relief for the 14th Amendment Residency Requirement ("Count I"), (2) injunctive
relief to for the 14th Amendment Residency Requirement ("Count II"), (3) declaratory and
injunctive relief for the 14th Amendment One Person, One Vote claim ("Count III"), and (4)
Delaware State Law-Exceeding Authority ("Count IV"). Defendants filed a motion to dismiss
and opening brief on August 26, 2015. (D.I. 10, 11.) Nichols filed an answering brief in opposition
on September 9, 2015. (D.I. 13 at 7.) Defendants filed a reply brief on September 21, 2015. (D.I.
14.)

III.

STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(l) provides that a party may bring a motion to

dismiss for lack of subject matter jurisdiction. Fed. R. Civ. P. 12(b)(l). Because standing is a
jurisdictional matter, a motion to dismiss for want of standing is also properly brought pursuant to
Federal Rule 12(b)(1). See St. Thomas-St. John Hotel & Tourism Ass'n v. Gov't of the VJ, 218
F.3d 232, 240 (3d Cir. 2000) ("The issue of standing is jurisdictional."); Kauffman v. Dreyfus

Fund, Inc., 434 F.2d 727, 733 (3d Cir. 1970) ("[W]e must not confuse requirements necessary to
state a cause of action: .. with the prerequisites of standing.").

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A party invoking federal jurisdiction bears the burden of establishing that she possesses
the requisite standing to bring an action. FOCUS v. Allegheny Cnty. Ct. Com. Pl., 75 F.3d 834,
838 (3d Cir. 1996) (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992)). In
examining a challenge to a party's standing, the court must accept as true all material allegations
set forth in the complaint and construe those facts in favor of the nonmoving party. See Warth v.

Seldin, 422 U.S. 490, 501 (1975); Storino v. Borough ofPoint Pleasant Beach, 322 F.3d 293, 296
(3d Cir. 2003 ). At tlie motion to dismiss stage, "general factual allegations of injury resulting from
the defendant's conduct may suffice." Lujan, 504 U.S. at 561; Ballentine v. United States, 486
F.3d 806, 810 (3d Cir. 2007).

IV.

DISCUSSION
In their motion, the Defendants make the following arguments: (1) the challenge to the

City's Special Referenda Election is too late, (2) Nichols has failed to make any claims
whatsoever against the defendants Cooper and Lynn, (3) the State of Delaware is the real party in
interest, (4) the plaintiff lacks standing, (5) the city did not exceed its authority in paying for an
advertisement in support of the Special Referenda Election, and (6) the court should abstain and
stay the case. (D.I. 10, 11 ). Given that Defendants challenge whether Nichols can maintain this
action in federal court and that their challenge goes to the court's jurisdiction, the court will first
address this issue.

A. Standing to Challenge the Special Election
Defendants argue that Nichols lacks standing to challenge the sixth-month residency
requirement in the charter because she suffered no injury. Specifically, they argue she was never
denied the opportunity to vote in the Special Referenda Election. (D.I. 11 at 12). Nichols responds

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that she possesses taxpayer standing. (D.I. 13 at 9.) She claims that she is suing in her capacity
as a municipal taxpayer to challenge taxpayer-funded elections, the resultant authorization of the
issuance of municipal debt instruments, and the expenditure of tax revenues to buy advertisements
to influence a bond referendum. Id.
In order to satisfy the standing requirements of Article III, a plaintiff must show "(1) it has
suffered an 'injury in fact' that is (a) concrete and particularized and (b) actual or imminent, not
conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the
defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed
by a favorable decision." Friends of the Earth, Inc. v. Laidlaw Environmental Servs., Inc., 528
U.S. 167, 180-81 (2000) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)). In
a voting case, voters need to show disadvantage to themselves as individuals. Baker v. Carr, 369
U.S. 186, 206 (1962). This requires "a plain, direct and adequate interest in maintaining the
effectiveness of their votes," Coleman v. Miller, 307 U.S. 433, 438 (1939). In contrast, a claim of
the right possessed by every citizen "to require that the government be administered according to
law" does not suffice for purposes of standing. Fairchild v. Hughes, 258 U.S. 126, 129 (1922).
See also Lance v. Coffman, 549 U.S. 437, 442 (2007) (Finding that plaintiffs lacked standing where

the only injury alleged was that the law had not been followed in the election and not a
particularized impact on the plaintiffs' votes).
The court agrees with Defendants that Nichols lacks standing. Initially, the court agrees
with Defendants that Nichols is not contesting the expenditure of tax funds, but the legality of the
Special Election. Second, the court notes that Nichols suffered no particularized injury as a result
of the Special Election. Nichols is a property owner in the city and had the right to vote in the

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Special Referenda Election. Thus, she lacks the concrete personal injury necessary to bring suit.
As a result, the court lacks the subject matter jurisdiction to hear this action. Therefore, the
complaint must be dismissed. The court will not consider Defendants remaining arguments. See

Berg v. Obama, 586 F.3d 234, 242 (3d Cir. 2009).
V.

CONCLUSION
For these reasons, Defendants' motion to dismiss is granted.

Dated: December J!j_, 2015

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