POWELL v. GEORGETOWN, INDIANA et al
Filing
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ORDER denying 66 Motion to Amend/Correct Judgment. See Order for details. Signed by Judge Tanya Walton Pratt on 12/7/2016. (MAT)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
NEW ALBANY DIVISION
PAUL R. POWELL Rev.,
Plaintiff,
v.
TOWN OF GEORGETOWN, INDIANA,
MIKE MILLS, JAMES E. TRIPURE, JR.,
PATTI DENISON, KATHY HALLER, and
JERRY BROCK,
Defendants.
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Case No. 4:14-cv-00004-TWP-TAB
ORDER ON MOTION TO ALTER OR AMEND JUDGMENT
This matter is before the Court on a Motion to Alter or Amend Judgment (“Motion to
Amend Judgment”) filed pursuant to Federal Rule of Civil Procedure 59(e) by Plaintiff Rev. Paul
R. Powell (“Powell”). (Filing No. 66.) On June 12, 2014, Powell filed an Amended Complaint
against Defendants the Town of Georgetown, Indiana (“Town”) and members of the Town
Council: Mike Mills, James E. Tripure, Jr., Patti Denison, Kathy Haller, and Jerry Brock
(collectively the “Town Council”). (Filing No. 18.) Powell, a landlord, initiated this lawsuit,
asserting that the Town threatened to shut off water service to several of his rental properties after
his tenants vacated the properties without paying their water bills. The Town also threatened not
to turn on the water service until Powell paid the full amount of the tenants’ delinquent water bills.
Powell argued that the Town’s policy violates the Equal Protection and Due Process clauses of the
state and federal constitutions and amounts to unconstitutional takings.
On May 19, 2016, following cross-motions for summary judgment, the Court granted the
Defendants’ Motion for Summary Judgment and denied Powell’s Motion for Partial Summary
Judgment. (Filing No. 64.) Thereafter, on June 14, 2016, Powell filed this Motion to Amend
Judgment, asserting that the Court erred in granting Defendants’ Motion for Summary Judgment.
(Filing No. 66.) For the following reasons, Powell’s Motion to Amend Judgment is denied.
I.
BACKGROUND
Powell owns six rental properties in Georgetown, Indiana. The Town has a longstanding
policy of turning off water service to properties that are delinquent on their water bills. The policy
states:
All bills must be paid by the 21st day of each month. A penalty will be added on
the amount of the bill, if the bill is not paid by the end of the working day. If the
bill is not paid by the 10th of the next following month in FULL, THE WATER
WILL BE CUT OFF
(Filing No. 56-3 at 7) (emphasis in original). The Town also has a policy of holding landlords
responsible for the unpaid water bills of their tenants and shutting off water to rental properties
until landlords pay the outstanding balances. Because of this policy, Powell paid an estimated
$20,000.00 over the past twenty years where former tenants vacated the properties without paying
their water bills. Powell knew about both policies for at least twenty-two years and voiced
concerns with the Town at various points in the past.
On June 12, 2014, Powell filed an Amended Complaint against Defendants, asserting that
the Town’s policy requiring a landlord to pay the water bills to avoid shut offs, violates the Equal
Protection and Due Process clauses of the state and federal constitutions, as well as the Takings
clause. On February 22, 2016, the Defendants collectively filed a Motion for Summary Judgment,
arguing that Powell erroneously asserted individual capacity suits against the Town Council, they
did not violate Powell’s Equal Protection or Due Process rights, nor did they violate the Takings
clause. (Filing No. 54.) Four days later, on February 26, 2016, Powell filed a Cross Motion for
Partial Summary Judgment, asserting only that he is a third party and is not liable for the unpaid
water bills of his tenants. (Filing No. 58.) Specifically, Powell argued that because he is not a
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party to the tenants’ contracts for water service, he is not obligated to pay the former tenants’
outstanding water bills. On May 19, 2016, the Court granted Defendants’ Motion for Summary
Judgment and denied Powell’s Motion for Partial Summary Judgment. The Court concluded that:
1) Powell failed to allege any action or omission on the part of the Town Council members that
they violated his constitutional rights; 2) Defendants did not violate the Equal Protection clause
because the Town’s policy of seeking payment of water bills from the former tenant and the
landlord is rationally related to a legitimate government interest of collecting unpaid balances; 3)
Due Process was not violated because Powell failed to identify a constitutional guarantee to water
service and he did not dispute that he had notice and the opportunity to be heard; lastly, 4)
Defendants did not violate the Takings clause because Powell failed to establish that he had a
protectable property interest in water service and that Defendants took the property for public use.
(Filing No. 64.)
Powell now asks the Court to amend its judgment asserting that the Court misapprehended
the applicable law and there are still disputed questions of material fact remaining. (Filing No. 66.)
II.
LEGAL STANDARD
The purpose of a motion to alter or amend judgment under Rule 59(e) is to ask the Court
to reconsider matters properly encompassed in a decision on the merits. Osterneck v. Ernst &
Whinney, 489 U.S. 169, 174 (1989). A Rule 59(e) motion will be successful only where the movant
clearly establishes: (1) that the court committed a manifest error of law or fact, or (2) that newly
discovered evidence precluded entry of judgment. Cincinnati Life Ins. Co. v. Beyrer, 722 F.3d
939, 954 (7th Cir. 2013); United States v. Resnick, 594 F.3d 562, 568 (7th Cir. 2010). Relief
pursuant to a Rule 59(e) motion to alter or amend is an “extraordinary remed[y] reserved for the
exceptional case.” Foster v. DeLuca, 545 F.3d 582, 584 (7th Cir. 2008). In this regard, a manifest
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error is not demonstrated by merely presenting “the disappointment of the losing party.” Oto v.
Metro. Life Ins. Co., 224 F.3d 601, 606 (7th Cir. 2000) (a manifest error is “the wholesale
disregard, misapplication, or failure to recognize controlling precedent.”). Further, a motion to
alter or amend a judgment is not an opportunity to “relitigate motions or present arguments, issues,
or facts that could and should have been presented earlier.” Brownstone Publ’g, LLC v. AT&T,
Inc., No. 1:07-CV-1630-SEB, 2009 WL 799546, at *3 (S.D. Ind. Mar. 24, 2009). See also
Sigsworth v. City of Aurora, Ill., 487 F.3d 506, 512 (7th Cir. 2007).
III.
DISCUSSION
Powell moves the Court to amend its judgement, asserting that the Court erred in granting
Defendants’ Motion for Summary Judgment because there remain issues of material facts. Powell
contends that the judgment should be amended because he properly stated claims of relief against
the Town Council members. Powell also asserts that Defendants violated the Takings and Equal
Protections clauses.
A.
Material Issues of Fact
Powell argues that the Court erred in granting summary judgment because material issues
of fact remain, namely: 1) the number of properties involved: 2) the adequacy of notice informing
Powell of his chance to be heard; 3) whether a previous agreement exists between Powell and the
Town establishing Powell as a “customer;” and 4) whether Powell’s protests to the Town Clerk’s
office regarding the debt, amounts to Powell attempting to request a hearing.
As an initial matter, the Court notes that neither party filed response or reply to briefs to
the cross motions for summary judgment. Because there were cross motions, the Court evaluated
each motion on its merits, resolving factual uncertainties and drawing all reasonable inferences
against the respective movant. As required, the Court considered and ruled on the cross motions
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based on the evidence designated in the record by both parties. Importantly, Powell’s motion to
alter or amend judgment under Rule 59(e) does not offer any newly discovered evidence for the
Courts’ consideration. Instead, Powell cites to numerous deposition passages and evidence that
were known to him when he filed his summary judgment brief, but was not previously designated
as evidence for the Court’s consideration. Accordingly, the deposition designations and affidavits
which were not before the Court when it made its summary judgment decision are not considered
in the motion to alter or amend.
Addressing the merits of his arguments, Powell first takes issue with the Court’s factual
finding that “Powell owns six rental properties in Georgetown, Indiana…For at least one of
Powell’s rental properties, the Town specified its policy in a contract with Powell.” (Filing No.
64 at 2.) Powell concedes that he has an ongoing contractual relationship with the Town, but
contends that a material issue of fact remains because the Court did not resolve whether the Town’s
policy applied to all six properties or only one. (Filing No. 66 at 8, 19.) In their Motion for
Summary Judgment, Defendants presented evidence that Powell entered into agreements with the
Town for water service when he purchased his six Georgetown properties. (Filing No. 56-2 at 20.)
The Defendants contended that Powell was aware that under those agreements he remained
responsible for the service at his rental properties, despite a tenant establishing a separate User
Contract, and if the tenant did not pay his or her water bill, then Powell was liable for the balance.
In his Cross Motion for Partial Summary Judgment, Powell did not dispute Defendants’ contention
that he was aware that the policy applied to all properties. Powell argued only that he was a third
party to the User Contracts between the Town and his former tenants, but made no mention of the
agreements he entered into with the Town.
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Powell also argues that an issue of material fact remains regarding the adequacy of notice
informing Powell of his right to dispute the water bills. In their Motion for Summary Judgment,
Defendants provided evidence that Powell received several notices from the Town, warning him
that water service to his rental properties would be disconnected unless Powell paid the outstanding
balances of his former tenants. The Defendants contended that the notice states, in relevant part,
as follows:
[i]f a Water Utility Customer desires to request a hearing contesting the
appropriateness of a contemplated disconnection for nonpayment of their water
utility bill, the customer shall request such hearing at the Georgetown’s Clerk’s
Office within seven (7) business days after the mailing of the disconnection notice.
(Filing No. 56-3 at 22) (emphasis in original). Powell raises for the first time that the above notice
in record bears a date after the actions complained of in this case and that there is no evidence that
he received the above notice. Powell also disputes, for the first time, whether he is a “customer”
as mentioned in the above notice, contending that he is a “previous owner” and, thus, has no
liability for the water charges. Despite his assertions, Powell points to evidence in the record
which discredits the Courts factual findings. For example, Filing No. 56-3 at 7-21 contains copies
of contracts for all six rental properties, not just one; and Filing No. 56-3 at 4 is a copy of the
disconnect letter issued on July 23, 2013 for the property located at 9190 St. Rd. 64, which is the
subject property listed in Powell’s Amended Complaint.
Powell lastly states that a material issue of fact remains because his protests to the Town
Clerk’s office amounts to an attempt to request a hearing. In their Motion for Summary Judgment,
Defendants contended that Powell’s Due Process rights were not violated because, among other
reasons, Powell had notice and an opportunity to be heard but never requested a hearing. In support
of their argument, Defendant designated Powell’s deposition testimony wherein Powell admitted
that he never requested a hearing regarding a shutoff or proposed shutoff (Filling No.56-2 at 27),
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as well as the letter which informs Powell of his right to a hearing (Filing No. 56-3 at 24). Powell
did not dispute Defendants’ factual assertions in his summary judgment briefing, therefore, he
cannot do so now.
A motion to alter or amend a judgment is not an opportunity to “relitigate motions or
present arguments, issues, or facts that could and should have been presented earlier.”
Brownstone, 2009 WL 799546, at *3. Because Powell did not raise these issues in his Cross
Motion for Partial Summary Judgment, Powell’s motion to amend on this basis is denied.
B.
Claims of Relief Against Town Council
Powell next asks the Court to amend its judgment because the Court, agreeing with
Defendants, found that Powell failed to allege any action or omission on the part of the Town
Council members that they violated Powell’s rights. In his Cross Motion for Partial Summary
Judgment, Powell did not rebut this argument.
Powell currently contends that in assessing the sufficiency of his allegation against the
Town Council members, the Court was required to analyze Federal Rule of Civil Procedure 8(a),
rather than Rule 56. Powell argues that he met the United States Supreme Court’s standard in
Twombly and Iqbal, when asserting in his Complaint a short plain statement showing that he is
entitled to relief. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009). The Court finds that Powell is mistaken in his assertion because both
Twombly and Iqbal involve motions to dismiss under Federal Rule of Civil Procedure 12(b)(6),
rather than a motion for summary judgment pursuant to Federal Rule of Civil Procedure 56. While
a complaint stating minimal factual allegations is sufficient to overcome a motion to dismiss, the
“purpose of summary judgment is to pierce the pleadings and to assess the proof in order to see
whether there is a genuine need for trial.” Matsushita Electric Industrial Co. v. Zenith Radio
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Corp., 475 U.S. 574, 587 (1986). Powell provided no evidence that the Town Council members
violated his rights. Accordingly, Powell’s Motion on this issue is denied.
C.
Takings
Powell also contends that the Court misinterpreted the applicable law when concluding that
Powell failed to allege that the Town’s threat to disconnect water service amounted to a taking.
Powell asserts that he did not need to show that the property was actually taken, but to plead only
an invasion or appropriation of his property right that resulted in his injury.
The Court agrees with Powell regarding the law, however, the issue still remains that
Defendants argued in their Motion for Summary Judgment that they did not violate the Takings
clause because Powell did not have a protected property right to water services, and even if he did,
Defendants did not take Powell’s property and turn it into something for public use, nor did they
ever disconnect Powell’s water services. (Filing No. 54.) Powell now, for the first time, contends
that the Town deprived him of a valuable protected property right that destroyed the value of his
rental properties. The Court finds that Powell is again attempting to present arguments that could
and should have been presented in his cross motion. The Court also concludes that Powell still
fails to provide evidence that his valuable protected property was turned into something for public
use, as required by the Takings clause. Accordingly, Powell’s Motion on this issue is denied.
D.
Equal Protection Violation
Powell lastly contends that he can demonstrate that Defendants violated his Equal
Protection rights and argues that the cases cited in the Court’s holding are not binding and are
distinguishable. Powell repeats the assertion he made in his Cross Motion for Partial Summary
Judgment and argues that the Seventh Circuit’s ruling in Sterling is controlling. See Sterling v.
Village of Maywood, 579 F.2d 1350 (7th Cir. 1978) (a collection scheme “that divorces itself
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entirely from the reality of legal accountability for the debt involved, is devoid of logical relation
to the collection of unpaid water bills from the defaulting debtor.”). Powell again asserts that he
is a third party and the Town’s policy of holding landlords responsible is not rationally related to
the collection of unpaid water bills from a defaulting debtor.
The Court finds that Powell has not established that the Court committed a manifest error
of law or fact. See Oto, 224 F.3d at 606. The Defendants relied on Golden v. City of Columbus,
404 F.3d 950, 960 (6th Cir. 2005) and O’Neal v. City of Seattle, 66 F.3d 1064, 1068 (9th Cir. 1995)
when asserting that because the right to water service is not a fundamental right and Powell failed
to allege a classification involving a protected class, the rational basis test applies. In Golden and
O’Neal, the Sixth and Ninth Circuits, respectively, recognized that requiring a landlord to pay the
water bill debt of former tenants is rationally related to a municipality’s purpose of collecting
unpaid debts. Golden, 404 F.3d 950 at 962; O'Neal, 66 F.3d at 1068. The Defendants also
distinguished the present case from Sterling, which held that a new tenant cannot be denied water
service in a rental property due to debts from previous tenants. See Sterling, 579 F.2d at 1355. The
Defendants contended that Sterling is inapplicable because the Town’s policy attempts to collect
water bill debts only from those legally responsible: the former tenant and the landlord. The Court
agreed.
In his Cross Motion for Partial Summary Judgment, despite arguing that he is a third party
to the User Agreements between the Town and former tenants, Powell did not dispute having a
contractual relationship with the Town that held him responsible for the unpaid water bills of his
former tenants. Additionally, in his Motion to Amend Judgment, Powell fails to demonstrate that
the Court misapplied Golden and O’Neal or disregarded controlling precedent that states that a
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landlord under contract may not be held responsible for the unpaid water bills of former tenants.
Accordingly, Powell’s Motion on this issue is denied.
IV.
CONCLUSION
As the Seventh Circuit has often stated, “summary judgment ‘is the ‘put up or shut up’
moment in a lawsuit, when a party must show what evidence it has that would convince a trier of
fact to accept its version of events.’” Koszola v. Bd. of Educ. of City of Chi., 385 F.3d 1104, 1111
(7th Cir. 2004) (quoting Johnson v. Cambridge Indus., Inc., 325 F.3d 892, 901 (7th Cir. 2003)).
Because Powell failed to do so in summary judgment pleadings, the motion for summary judgment
filed by Defendants is properly granted and Powell’s cross motion for partial summary judgment
is properly denied. For the aforementioned reasons, the Court DENIES Powell’s Motion to
Amend Judgment. (Filing No. 66.)
SO ORDERED.
Date: 12/7/2016
DISTRIBUTION:
Frank Yates, Jr.
frankyatesjr@insightbb.com
R. Jeffrey Lowe
KIGHTLINGER & GRAY, LLP-New Albany
jlowe@k-glaw.com
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