Cherry, Jr. et al v. Mayor and City Council of Baltimore City et al

Filing 229

MEMORANDUM AND ORDER denying 215 Motion for Leave to File Second Amended Complaint ; denying as moot 225 Motion to Abstain. Signed by Judge Marvin J. Garbis on 7/22/2016. (ca2s, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
ROBERT F. CHERRY, JR., et al.
Plaintiffs
vs.
MAYOR AND CITY COUNCIL OF
BALTIMORE CITY, et al.

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CIVIL ACTION NO. MJG-10-1447

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Defendants
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MEMORANDUM AND ORDER RE: AMENDED COMPLAINT
The Court has before it Plaintiffs' Motion for Leave to
File Second Amended Complaint [ECF No. 215], Defendant Mayor and
City Council of Baltimore City's ["the City's"] Motion to
Abstain [ECF No. 225] and the materials submitted relating
thereto.

The Court has held a hearing and had the benefit of

the arguments of counsel.

I.

SUMMARY BACKGROUND1
In 1962, Baltimore City enacted the Fire and Police

Employees' Retirement System of the City of Baltimore (the
"Plan"), which provides defined benefits to its members and
beneficiaries.

In 2010, the City enacted Ordinance 10-306, that

unilaterally modified the provisions of the Plan in several

1

For further background, see Cherry v. Mayor and City Council of
Baltimore City, 762 F.3d 366 (4th Cir. 2014) ("the Appellate
Decision") and this Court's decisions [ECF Nos. 68, 115, 167].

respects, effective July 1, 2010.

Plaintiffs filed the First

Amended and Restated Class Action Complaint for Declaratory,
Injunctive, and Monetary Relief [ECF No. 5] (the "Amended
Complaint") asserting2 state-law contract claims and federal
claims under the Contract and Takings clauses of the United
States Constitution.
The Court held that the City had violated Constitutional
rights of certain union members3 in violation of the Contract
Clause.

By agreement of the parties, the Court dismissed the

Takings Clause claim as moot, dismissed the state-law contract
claims without prejudice, and entered a final judgment subject
to appeal. On appeal, the United States Court of Appeals for the
Fourth Circuit held that the Contract Clause rights had not been
impaired because the Plaintiffs retained a state-law remedy for
breach of contract and that the Takings Clause Claim was no
longer moot.

Cherry, 762 F.3d at 373-74.

the case for further proceedings.

The Court remanded

Id. at 374.

As to further

proceedings, the appellate court stated:
The plaintiffs may attempt to refile in
the district court their state law claims
that were dismissed without prejudice, or
they may initiate proceedings in state court
alleging breach of contract under Maryland
law. If the plaintiffs choose to pursue
either of these two courses of action, the
2

Among other claims.
I.e., those who were retired or eligible for retirement on the
date the Ordinance was enacted.
3

2

district court may wish to hold any
proceedings regarding the Takings Clause
claim in abeyance pending the resolution of
related contractual issues.
Id. at 374, n.6.
Plaintiffs seek to refile the state-law contract claims in
federal court in the proffered Second Amended Complaint ("SAC").
Defendants seek to have the Court deny the motion or,
alternatively, to abstain from deciding the state-law contract
claims.

II. DISCUSSION
Plaintiffs may file the proffered SAC only with the City's
consent or leave of Court.
does not consent.

Fed. R. Civ. P. 15(a)(2).

The City

However, "the court should freely give leave

when justice so requires."

Id.

The City contends that amendment would be futile and that,
in any event, the Court should exercise its discretion to deny
the amendment.

A.

Futility

The City asserts that amendment would be futile because the
Court would lack jurisdiction over the state-law claims asserted
therein due to the absence of any pending federal claim.
According to the City, the Takings Clause claim will not be ripe

3

until after the state-law claims are resolved and may be
rendered moot by the resolution of the state-law claims.
The City's position appears to be worthy of reasonable
debate.

If Plaintiffs prevail on the state-law claims – as

would be the case if they had prevailed on the Contract Clause
claims – it appears that they would obtain the relief they seek
on their federal claims.

The City contends that should

Plaintiffs not prevail on their state-law contract claims, they
would not have any rights that were subject to unconstitutional
taking.

However, it may be possible for Plaintiffs to have a

valid Contract Clause claim if the basis for denial of their
state-law claims did not pass Constitutional muster.
Moreover, the appellate court referred to the deferral
(rather than dismissal) of the Takings Clause claim.

This,

albeit dictum, indicates a belief that the Takings Clause was
not moot and remained pending.
Accordingly, the Court will not deny the requested
amendment on the ground of futility.

B.

Exercise of Discretion

Supplemental jurisdiction is provided by 28 U.S.C. § 1367
that provides, in pertinent part:
(a) Except as provided in [subsection (c)].
. . in any civil action of which the
district courts have original jurisdiction,
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the district courts shall have supplemental
jurisdiction over all other claims that are
so related to claims in the action within
such original jurisdiction that they form
part of the same case or controversy under
Article III of the United States
Constitution.
. . . .
(c) The district courts may decline to
exercise supplemental jurisdiction over a
claim under subsection (a) if—
(1)
the claim raises a novel or complex
issue of State law [or]
(2)
the claim substantially predominates
over the claim or claims over which the
district court has original jurisdiction. .
. . 4
The Court finds that the proffered state-law claims present
novel and complex issues of State law.

The state-law questions

are by no means simple and straightforward.

Indeed, it is

likely, even if the state-law claims were to proceed in federal
court, there would be a request by one side, or both sides, to
have the district court or the Fourth Circuit certify state-law
questions to the Maryland Court of Appeals due to the absence of
clear authority governing the issues.
Further, the state-law claims substantially predominate
over the federal claims over which the district court has
original jurisdiction.

Both the Contract Clause and Takings

4

The Court finds it unnecessary to consider 28 U.S.C. §
1367(c)(4)referring to "exceptional circumstances" creating
other compelling reasons to decline jurisdiction.
5

Clause claims will be affected, possibly controlled, by the
ultimate determination of the state-law claims.

Indeed, the

parties agree, and the Fourth Circuit appears to suggest, that
consideration of the Takings Clause claim be deferred until
after resolution of the state-law claims.
"A federal court should consider and weigh . . . the values
of judicial economy, convenience, fairness, and comity in order
to decide whether to exercise jurisdiction over a case brought
in that court involving pendent state-law claims." Carnegie–
Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988).
The Court has done so.

In so doing, the Court is fully

appreciative of the Plaintiffs' interest in avoiding unnecessary
delay in obtaining final resolution of the dispute at issue.

Of

course, there could be a degree of efficiency resulting from
having the state-law claims proceed in federal court in view of
the undersigned Judge's having presided over the case to date.
However, the City has agreed that the entire record of
proceedings herein can be deemed "on the record" in a state
court presenting the state-law claims, reducing – if not
virtually eliminating – the need for duplicative proceedings
regarding factual issues.

Moreover, it appears that there will

be little, if any, efficiency in having the state-law legal

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issues reargued to the federal trial court5 rather than argued to
a state trial court.

Nor does there appear to be any gain in

efficiency in having appellate proceedings in the United States
Court of Appeals for the Fourth Circuit.

Indeed, there appears

to be a probability that the Fourth Circuit would be inclined to
certify controlling state-law issues to the Maryland Court of
Appeals.
Finally, the Court finds most important the immense local
(state and city) significance of the issues presented.

In

particular, the resolution of the conflict between the contract
rights asserted by Baltimore City fire and police safety
personnel and the City's asserted financial concerns allegedly
justifying the abridgement of those rights.
Accordingly, the Court shall exercise its discretion to
decline to accept supplemental jurisdiction of the state-law
claims.

The Court will, however, retain jurisdiction of the

federal claims,6 but shall stay proceedings thereon pending the
resolution of the related state-law claims.

5

This Court has rendered opinions, in its Contract Clause claim
decisions, on issues that are presented by the state-law
contract claims; some agreeing with the Plaintiffs and some
agreeing with the City. It appears likely that, even if this
case were to proceed in federal court, each such opinion will be
reargued, the losing party seeking reconsideration or contending
that the changed context warrants a different decision.
6
I.e., the Takings Clause and, to the extent still pending, the
Contract Clause claims.
7

III.

CONCLUSION
For the foregoing reasons:
1.

Plaintiffs' Motion for Leave to File Second
Amended Complaint [ECF No. 215] is DENIED.

2.

Defendant Mayor and City Council of Baltimore
City's Motion to Abstain [ECF No. 225] is DENIED
AS MOOT.

3.

By separate Order, this case shall be stayed
pending resolution of the state-law claims set
forth in the proffered Second Amended Complaint.

SO ORDERED, on Friday, July 22, 2016.

/s/__________
Marvin J. Garbis
United States District Judge

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