Kircher v. Ypsilanti, City of et al
Filing
99
OPINION and ORDER Denying 84 , 97 Leave to Amend and Granting Defendant's 88 MOTION to Dismiss. Signed by District Judge Sean F. Cox. (TMcg)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
David Kircher,
Plaintiff,
v.
Case No. 04-72449
City of Ypsilanti, et al.,
Sean F. Cox
United States District Court Judge
Defendants.
______________________________/
OPINION & ORDER
DENYING LEAVE TO AMEND AND
GRANTING DEFENDANTS’ MOTION TO DISMISS
This 2004 case was reassigned to this Court in 2017, when the Honorable Gerald Rosen
retired. The case involves protracted state-court litigation between Plaintiff David Kircher, a
property owner in Ypsilanti, Michigan, and the City of Ypsilanti and several of its officials. The
case is currently before the Court on: 1) Plaintiff’s motion seeking to file an amended complaint,
which Defendants oppose; and 2) a Motion to Dismiss filed by Defendants, that asserts multiple
grounds for relief. The motions have been briefed and the Court heard oral argument on April
12, 2018. For the reasons set forth below, the Court shall deny Plaintiff’s motion seeking leave
to amend, and grant Defendants’ motion to dismiss, because the constitutional claims that
Plaintiff wishes to pursue in this action are barred under the applicable preclusion doctrines.
BACKGROUND
A.
Procedural Background
Acting through counsel, George Ward, Plaintiff David Kircher filed this action on July 1,
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2004, naming the following Defendants: 1) the City of Ypsilanti; 2) Cheryl Farmer, Mayor of
Ypsilanti; 3) Charles Boulard, Building Inspector of Ypsilanti; 4) Jon Ichesco, Fire Marshall of
Ypsilanti; 5) Robert Barnes, 6) Donald Shelton, Washtenaw County Circuit Court Judge; and 7)
Timothy Connors, Washtenaw County Circuit Court Judge. The action was assigned to the
Honorable Gerald Rosen.
Plaintiff filed a First Amended Complaint on July 9, 2004, against the same Defendants.
(D.E. No. 3). This is the operative complaint and it contains four separate counts – none of
which are titled.
Two Defendants, Judge Shelton and Judge Connors, filed an early Motion to Dismiss,
based on judicial immunity and other grounds, that was granted by Judge Rosen. Thus, they are
no longer in the case.
The remaining Defendants filed a Motion to Dismiss or Stay action on September 10,
2004. (D.E. No. 17 & 18).
On October 10, 2006, Judge Rosen issued an “Order Staying Case In Favor Of Parallel
State Court Proceedings” (D.E. No. 37) wherein he “ORDERED that all proceedings in this case
are STAYED until such time as the related state court actions have fully concluded, including
any appeals that are pending or that the parties might elect to pursue.” (Id.). Judge Rosen
remanded the matter to state court under the Younger abstention doctrine.
Approximately ten years later, on November 9, 2016, Plaintiff filed a motion seeking to
end the stay (D.E. No. 69), which this Court granted in an Order issued on May 12, 2017. (D.E.
No. 78).
On October 4, 2017, Plaintiff, who is now represented by new counsel, filed a “Motion
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for Leave to Amend Complaint and for Discovery” (D.E. No. 84). That motion is opposed by
Defendants. Plaintiff attaches his proposed Second Amended Complaint as Exhibit A. It
includes the same five Defendants but now has five separately-titled counts: 1) “Inverse
Condemnation – Taking Of Property For Economic Rejuvenation and/or Economic
Development” (Count I); 2) “Inverse Condemnation – De Facto Taking” (Count II); 3) “Inverse
Condemnation – Unreasonable Delay In Acquiring Property” (Count III); 4) “Substantive Due
Process” (Count IV); and 5) “Procedural Due Process” (Count V).
On November 7, 2017, Defendants filed Motion to Dismiss, pursuant to Fed. R. Civ. P.
12(b)(1) and (b)(6). (D.E. No. 88).
B.
Standard of Decision
Plaintiff has filed a motion seeking leave to file his proposed Second Amended
Complaint, which asserts that the same claims against the same Defendants. Plaintiff asserts that
he wishes to file this amended pleading in order to clarify the claims (by asserting them in titled
counts) and by including additional factual allegations as to proceedings that have occurred since
the time that Plaintiff filed his last complaint. Defendants agree that it raises the same claims as
raised in the First Amended Complaint (see D.E. No. 85 at Pg ID 1227).
Defendants oppose Plaintiff’s motion on futility grounds. In addition, Defendants have
filed a separate Motion to Dismiss, pursuant to Fed. R. Civ. P. 12(b)(1) and (b)(6).
Amendment of a complaint is futile when the proposed pleading would not permit the
complaint to survive a motion to dismiss under Fed. R. Civ. P. 12(b)(6). Miller v. Calhoun
Cnty., 408 F.3d 803, 817 (6th Cir. 2005).
Accordingly, this Court must consider whether Plaintiff’s proposed Second Amended
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Complaint can withstand a motion to dismiss. If it can, the Court should grant Plaintiff’s motion
for leave to file it and deny Defendants’ Motion to Dismiss. If it cannot, then the Court should
grant Defendants’ Motion to Dismiss, deny Plaintiff’s motion for leave, and dismiss the case.
“In determining whether to grant a Rule 12(b)(6) motion, the court primarily considers
the allegations in the complaint, although matters of public record, orders, items appearing in the
record of the case, and exhibits attached to the complaint, also may be taken into account.”
Amini v. Oberlin College, 259 F.3d 493, 502 (6th Cir. 2001).
Here, there have been extensive proceedings in the state court that are relevant to
Plaintiff’s claims and Defendant’s Motion to Dismiss. What follows is the factual history, taken
from the allegations in Plaintiff’s proposed Second Amended Complaint, the orders and opinions
entered in the state court case, and facts stipulated to by the parties.
C.
Relevant Facts
Pursuant to this Court’s directive, both Plaintiff and Defendants submitted statements of
material facts, so that they could acknowledge the numerous facts that are not in dispute. (D.E.
Nos. 91-28 & 95). The Court shall refer to those submissions as “Pl.’s Stmt.” and “Defs.’
Stmt.,” followed by the corresponding paragraph number.
Plaintiff David Kircher is a graduate engineer of the University of Michigan, a licensed
electrical mechanical contractor and licensed master electrician, and a former Ypsilanti City
council member. (Pl.’s proposed Sec. Am. Compl. at ¶ 1).
Plaintiff’s claims in this action relate to three state-court actions concerning three
properties owned by Plaintiff in Ypsilanti, Michigan.
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1.
The Cross Street Property
The “Cross Street Property,” 510 W. Cross Street, is a residential apartment complex that
Plaintiff purchased in the 1960’s. (Pl.’s proposed Sec. Am. Compl. at ¶ 46-47). In 2000,
Defendant Robert Barnes owned the remaining properties on the Cross Street block and Barnes’s
principal place of business was 520 W. Cross Street. In 2000, Barnes made an offer to Plaintiff
to buy the Cross Street Property, but Plaintiff refused to sell it to Barnes. (Id. at ¶¶ 48-49).
Plaintiff alleges that, “[s]tarting in approximately 2001, Defendants intended to transfer the Cross
Street Property from [Plaintiff] to Barnes for the purpose of making a better economic use of the
property;” “[s]pecifically, the Defendants desired to transfer the Cross Street Property to Barnes
to enable Barnes to turn the property into a sorority or fraternity house.” (Id. at ¶¶ 50-51).
On May 14, 2001, the City of Ypsilanti (the “City”) and the Fire Marshal for the City, Jon
Ichesco (“Ichesco”), filed a “Complaint for Nuisance Abatement and/or Raze the Building and Order
to Show Cause” regarding the Cross Street Property. (Pl.’s & Defs.’ Stmts. at ¶ 1). The Cross Street
Complaint was filed under MCL 29.23, part of the Fire Prevention Code.
(Id. at ¶ 2).
On August 20, 2001, the circuit court entered an Order for Fire and Building Code
Compliance. (Pl.’s & Defs.’ Stmts. at ¶ 3; see D.E. No. 91-9). That “Order for Fire and Building
Code Compliance Repairs” stated that, the “parties having appeared in Court for a Show Cause
hearing,” the Court was ordering certain relief and attached a list of 224 repair items. It provided
that a “valid certificate of occupancy must be obtained from the building inspection department
before any unit in the building may be occupied.” It also stated, in Section G, that Plaintiff,
“Harvey Hutchison, Jon Ichesco, will meet within two weeks to resolve as many issues as
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possible with the understanding that the parties will litigate the rest at an evidentiary hearing on
08-30-01 at 2:00.” (D.E. No. 91-9 at Pg ID 1776). That evidentiary hearing was adjourned,
however, because the parties entered a stipulated order. (See D.E. No. 91-2 at Pg ID 1696).
The City requested, and the circuit court ordered, that the Cross Street Property be
vacated. (Pl.’s & Defs.’ Stmts. at ¶ 4).
On November 21, 2001, Harry Hutchinson, Director of the City’s Department of Public
Works, sent a letter to Kircher specifying repairs that needed to be made to the Cross Street
Property before a certificate of occupancy would be issued. (D.E. No. 91-19 at Pg ID 1859).
Although prior evidentiary hearings had been scheduled, they had not occurred for various
reasons, including stipulated orders from the parties and a cancellation by the circuit court.
On May 28, 2002, the circuit court held an evidentiary hearing, during which testimony was
taken regarding the Cross Street Property. That evidentiary hearing was the only evidentiary
hearing regarding the Cross Street Property prior to any appeals to the Michigan Court of
Appeals. (Pl.’s & Defs.’ Stmts. at ¶ 9).
On June 14, 2002, the circuit court entered an Order giving the City the exclusive right to
repair the building and fire code violations at the Cross Street Property. (Pl.’s & Defs.’ Stmts. at
¶ 10). The June 14, 2002 circuit court order specified five repairs to be made by the City. (Id. at
¶ 11).
On June 25, 2002, the City’s Building Official, Charles Boulard, sent a letter to Kircher
stating that it was responding to “the plethora of inspection requests that you have made of the
Building Department over the last several weeks.” (D.E. No. 91-18). The letter referenced
requests relating to several properties. As to the Cross Street Property, it said:
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Address:
Request:
Response:
510 W. Cross
Inspection of the chimney of the structure by Building Inspector
Avram
Request cannot be honored. It is my sincere belief that performing
the requested inspection would be contrary to the spoken and
written orders of the Court.
(Id.).
On July 22, 2002, Kircher appealed the circuit court’s June 14, 2002 order to the
Michigan Court of Appeals. (Pl.’s & Defs.’ Stmts. at ¶ 13).
On November 21, 2002, the City hired Barnes & Barnes to make the five repairs
enumerated in the June 14, 2002 order to the Cross Street Property. (Pl.’s & Defs.’ Stmts. at ¶
14). Barnes charged Kircher $54,376.74 for those five repairs. (Id. at ¶ 15).
After completing the five repairs enumerated in the circuit court’s June 14, 2002 order,
Barnes continued making additional repairs and renovations to the Cross Street Property. (Pl.’s &
Defs.’ Stmts. at ¶ 16). As of November 14, 2003, Barnes claimed that the amount owed by
Kircher for repairs at the Cross Street Property was $95,559.50. (Pl.’s & Defs.’ Stmts. at ¶ 17).
On November 14, 2003, Barnes filed a complaint to foreclose judicial lien on the Cross Street
Property and to determine interests in real property. (Pl.’s & Defs.’ Stmts. at ¶ 18).
On December 17, 2003, the City and Barnes filed a joint motion requesting authority
from the circuit court to reconfigure the Cross Street Property into a sorority or fraternity house.
(Pl.’s & Defs.’ Stmts. at ¶ 19).
At a hearing in February of 2004, the attorney for the City stated that the purpose of the
circuit court’s order giving the City authority to make repairs to the Cross Street Property to get a
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certificate of occupancy was intended to mean that the City had authority to make the property
“economically viable.” (Pl.’s & Defs.’ Stmts. at ¶ 20).
As of February 11, 2004, Barnes had demolished the interior of the Cross Street Property.
(Pl.’s & Defs.’ Stmts. at ¶ 21).
On February 11, 2004, the circuit court denied the City and Barnes’ request to reconfigure
the Cross Street Property into a sorority or fraternity house. (Id. at ¶ 22).
Undeterred, on March 17, 2004, Barnes applied to the City for a special use permit to use
the Cross Street Property as a sorority or fraternity house. (Id. at ¶ 23).
On April 27, 2004, the Court of Appeals remanded the case back to the trial court. With
regard to the Cross Street Property, the Court of Appeals stated: “the order does not provide for
the trial court’s approval of the amount charged to defendant for the repairs. In light of the harsh
consequences of defendant’s failure to pay, the order must provide that charges to defendant shall
be reviewed by the trial court to determine whether they are appropriate and reasonable before
defendant is required to pay.” (Id. at ¶ 24).
On May 25, 2004, the City approved Barnes’ request for a special use permit to use the
Cross Street Property as a sorority or fraternity house. (Id. at ¶ 25).
On July 1, 2004, Plaintiff filed his Complaint in the United States District Court for the
Eastern District of Michigan concerning constitutional violations regarding the Cross Street
Property. (Id. at ¶ 26). On July 9, 2004, Plaintiff amended his Complaint as of right to state
constitutional claims regarding the Cross Street Property, the Perrin Property, and the Thompson
Building. (Id. at ¶ 27).
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Barnes charged at least another $163,926.58 to Kircher between April 8, 2003 and
January 19, 2005 for repairs and renovations to the Cross Street Property. The circuit court did
not review the nature of the repairs, the plans, or the proposed costs, prior to the repairs or
renovations being made by Barnes. No evidentiary hearing occurred regarding the $163,926.58
claimed to be due for repairs and renovations prior to Kircher’s first appeal to the Michigan
Court of Appeals. (Pl.’s & Defs.’ Stmts. at ¶¶ 29-30).
After the Court of Appeals April 27, 2004 Order remanding the cases to circuit court, the
circuit court held an evidentiary hearing on July 22, 2004 for the repairs made to the Thompson
Building and Cross Street Property, together with an evidentiary hearing regarding the
foreclosure sales of each of those properties. (Id. at ¶ 31). The circuit court expressly stated that
it was not addressing any constitutional issues at the July 22, 2004 evidentiary hearing. (Id. at ¶
32).
After testimony at the July 22, 2004 evidentiary hearing regarding the Thompson
Building, the evidentiary hearing was adjourned to December 10, 2004 to address the Cross
Street Property. (Id. at ¶ 33).
On September 2 – 3, 2004, Kircher filed England Reservations in each of the City’s
nuisance abatement cases and foreclosure cases. (Id. at ¶ 34).
At an evidentiary hearing on December 10, 2004, Barnes, Jr. testified as follows
regarding the additional repairs and renovations that were made to the Cross Street Property by
Barnes: 1) “Barnes, Jr., testified that after these five initial repairs, Barnes & Barnes determined
that additional repairs were necessary, moved forward with these repairs, and billed Kircher for
the additional repair costs;” 2) “[Barnes, Jr.] testified that Barnes & Barnes had never asked the
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trial court for permission to go beyond the five specific repairs listed in the trial court’s June 14,
2002 order, and conceded that Kircher had never received an opportunity to contest or object to
any of these additional repairs and modifications;” 3) “Whereas the original five repairs had
been related to the abatement of alleged Fire Prevention Code violations, Barnes, Jr., indicated
that the additional repairs were completed to bring the apartment building into compliance with
Ypsilanti city ordinances and to make the building economically viable;” 4) “[Barnes, Jr.]
indicated that although the trial court had denied the request to convert the property into a
fraternity or sorority house, the additional work done by Barnes & Barnes was intended to
facilitate modification of the property into a fraternity or sorority house in the future in the event
that Barnes ultimately received ownership of the building.” (Pl.’s Stmt. & Defs.’ Stmt. at ¶ 35).
On January 19, 2005, the circuit court ruled that Kircher owed a total of $218,303.32 for
repairs to the Cross Street Property. On February 4, 2005, the circuit court entered a judgment of
foreclosure regarding the Cross Street Property. The circuit court found that a lien had attached to
the Cross Street Property in the amount of $218,303.32. Barnes purchased the Cross Street
Property at a sheriff’s sale for $244,535.09. (Pl.’s & Defs.’ Stmts. at ¶¶ 36-39).
Kircher appealed to the Michigan Court of Appeals. On January 9, 2007, the Michigan
Court of Appeals made the following observation:
Because the remand instructions were not followed, and the circuit court did not approve
the costs of repairs and renovations before they were incurred, Kircher necessarily
received no opportunity to contest the individual costs incurred by Barnes or to offer
evidence in response to the individual proposed projects at the Thompson Building. We
recognize that Judge Shelton held after-the-fact evidentiary hearings in an attempt to
comply with our remand instructions, and that after these hearings he ultimately approved
virtually all of the incurred costs. However, we cannot determine whether Judge
Shelton’s findings were clearly erroneous because we are not sufficiently presented with
competing evidence, which surely would have been offered by the parties had this matter
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proceeded as directed under our April 27, 2004 opinion. The circuit court’s after-the-fact
approval of the numerous expenses incurred in this matter does not afford us the
opportunity for meaningful review that would have followed from an organized cost-bycost determination in the court below. Moreover, we cannot omit mention of the real
possibility that by reserving review of all expenses until after the repairs and renovations
were already completed, Judge Shelton in effect preordained his decision to allow or
disallow each individual expenditure. It is much less subjective to evaluate the propriety
of proposed repairs before they are begun than after the work is finished and the costs are
already incurred.
(Pl.’s & Defs.’ Stmts. at ¶ 41). The Court of Appeals remanded the case in its January 9,
2007 Opinion with the following instructions regarding the Cross Street Property:
We vacate the judgment of foreclosure and invalidate the foreclosure proceedings to the
extent that they involved the collection of expenses incurred solely under the municipal
building and fire codes. We remand for the entry of an order terminating Ypsilanti's right
to possession and to make necessary repairs at the time of the sheriff's sale, and for the
following further proceedings.
On remand, the trial court shall determine whether each expense was incurred (1) to abate
a violation of the Fire Prevention Code, or (2) to abate a violation of the Ypsilanti
building and fire codes. For expenses falling into the second category, the court shall state
with specificity which provision of the city codes authorized the charges. The trial court
shall determine which expenses were properly incurred to abate violations of the Fire
Prevention Code, and shall include these expenses in the amount of the foreclosed lien.
The trial court shall then determine which expenses were properly incurred to abate
violations of the Ypsilanti building and fire codes, and shall exclude these expenses from
the lien amount as surplus. All costs properly incurred to abate violations of the Ypsilanti
building and fire codes shall be paid out of this surplus, and any remainder left after
payment of these expenses shall be disbursed to Kircher.
(Id. at ¶ 42).
In its January 9th Opinion, the Court of Appeals stated, “[i]n light of our resolution of
these consolidated appeals, we decline to address the constitutional issues raised by Kircher in
these cases.” (Ypsilanti Fire Marshal v. Kircher, 273 Mich.App. 496, 533 (2007)). But in a
footnote to that sentence, the Court of Appeals ruled:
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Relying on Wayne Co. v. Hathcock, 471 Mich. 445; 684 N.W.2d 765
(2004), Kircher cursorily suggests that his properties have been taken by
Ypsilanti without just compensation. Even assuming the requisite state action
could be demonstrated, we disagree with [Plaintiff]’s contention, which
disregards the well-established nuisance exception to the prohibition on
governmental takings. The federal and state constitutions both proscribe the
taking of private property for public use without just compensation. The Takings
Clause of the Fifth Amendment is substantially similar to the Takings Clause of
the Michigan Constitution, and the two provisions should generally be
interpreted coextensively. The nuisance exception to the prohibition on
unconstitutional takings provides that because no individual has the right to use
his or her property so as to create a nuisance, “the [s]tate has not ‘taken’ anything
when it asserts its power to enjoin [a] nuisance-like activity.” Indeed, “[c]ourts
have consistently held that a [s]tate need not provide compensation when it
diminishes or destroys the value of property by stopping illegal activity or
abating a public nuisance.” Because Ypsilanti was exercising its legitimate police
power to abate the alleged nuisances on Kircher’s property, no unconstitutional
taking occurred.
(Id.).
A later panel of the Michigan Court of Appeals considered that footnote a ruling on the
taking issue, as it stated: “the majority of the issues raised by Kircher are merely a rehashing of
issues raised in previous appeals before this Court such as his contentions regarding the trial
court’s lack of jurisdiction, . . . the award of attorney and receiver fees and the existence of a
conspiracy between Ypsilanti and Barnses to effectuate an unconstitutional taking of Kircher’s
properties. As each of these issues has been addressed repeatedly in both the trial court and
before this Court, we find no need to go into further or extensive detail regarding these claims.
It is sufficient to note that since all of these issues have been previously addressed and ruled on
they are precluded from reexamination by the law of the case doctrine.” Ypsilanti Fire Marshal
v. Kircher, 2011 WL 6187067 (Mich. App. 2011).
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And the Michigan Court of Appeals has since cited to the 2007 decision to support the
proposition that there is a nuisance exception to takings claims. See Ligon v. City of Detroit,
739N.W.2d 900, 908 n5, 276 Mich. App. 120, 132 (2007)(“As the City points out, there is a
well-recognized nuisance exception to the Takings Clause of the Fifth Amendment.”); Wayne
Cty. Exec. v. Aggor, No. 266183, 2007 WL 2067936, at *2 (Mich. Ct. App. July 19,
2007)(“Indeed, “[c]ourts have consistently held that a [s]tate need not provide compensation
when it diminishes or destroys the value of property by stopping illegal activity or abating a
public nuisance.”)
On remand from the Court of Appeals January 9, 2007 Opinion, the circuit court
approved liens on the Cross Street Property in the amount of $211,159.27 at an after-the-fact
evidentiary hearing. (Pl.’s & Defs.’ Stmts. at ¶ 44).
Kircher appealed to the Court of Appeals three more times concerning the Thompson
Building and the Cross Street Property. The first two appeals ended with remands to the circuit
court for more clarification regarding the liens and the last appeal was denied. (Id. at ¶ 45).
II.
The Thompson Building
On April 11, 2002, the City and Ichesco filed a “Complaint for Order to Show Cause, and
for Immediate Appointment of Receiver” regarding the Thompson Building. (Pl.’s & Defs.’ Stmts.
at ¶ 46). On June 14, 2002, the circuit court entered an order regarding the Thompson Building
which: 1) appointed Barnes as a receiver; 2) required that Barnes make the building “economically
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viable and functional;” and 3) prohibited Plaintiff from entering the property. (Id. at ¶ 47).
Although the court had held a Show Cause hearing on May 28, 2002, no evidentiary hearing
took place between April 11, 2002 and June 14, 2002.
On June 25, 2002, the City’s Building Official, Charles Boulard sent a letter to Kircher
refusing Kircher’s prior request for reinspection of the repairs Kircher had made to the Thompson
Building. (Pl.’s & Defs.’ Stmts. at ¶ 50).
On August 17, 2002, Barnes published his development plans for the Thompson Building
in the Ann Arbor News, with the article stating: “The younger Barnes said this week he and his
father hope to restore the building and add six to eight luxury apartments on each of the top two
floors, and put four or five commercial tenants on the street-level.” (Pl.’s & Defs.’ Stmts. at ¶ 51).
Barnes Jr. stated that the Thompson Building “appears to be structurally sound” as of August 17,
2002. (Id. at ¶ 52).
On October 30, 2002, Lopez Engineering performed an inspection of the Thompson Building
and, on November 6th it drafted a report wherein it found that “Considering the age of the building
it is in reasonably good structural condition.” That November 6, 2002 Inspection Report further
stated that “[c]urrently, the building is not a danger to its occupants. The building is capable of
supporting itself for several more years. Repairs are required, but evacuation of the occupants is not
required in order for the repairs to be performed.” (D.E. No. 91-17).
From June 14, 2002 to at least April 27, 2004, Barnes and the City had exclusive possession
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of the Thompson Building and were permitted to repair and renovate the property with unlimited
authority. (Pl.’s & Defs.’ Stmts. at ¶ 55)
On April 27, 2004, the Michigan Court of Appeals held:
Defendant also argues that the order allows the receiver to spend and charge
to defendant unlimited amounts of money for unspecified repairs. We agree. By
giving the receiver the authority to make the Thompson building "economically
viable," the order allows the receiver to make repairs beyond removing the hazards
of which plaintiffs originally complained. Plaintiffs' reliance on the fire code does
not support its argument that the broad scope of the order is appropriate. The quoted
portion of the fire code only addresses hazards that endanger human life. It does not
address the "economic viability" of the building. Accordingly, we reverse that
portion of the June 14, 2002, order providing "that the Receiver needs to make the
building economically viable and functional.”
(Pl.’s & Defs.’ Stmts. at ¶ 56).
On July 1, 2004, Plaintiff filed his Complaint in the United States District Court for the
Eastern District of Michigan concerning constitutional violations regarding the Cross Street Property.
Plaintiff amended his Complaint as of right to state constitutional claims regarding the Cross Street
Property, the Perrin Property and the Thompson Building. (Id. at 57-58).
The first evidentiary hearing regarding the Thompson Building was held on July 22, 2004,
after remand from the Court of Appeals. The July 22, 2004 evidentiary hearing concerned both the
repairs to the Thompson Building and the foreclosure of the Thompson Building. (Id. at 59-60).
At the July 22, 2004 evidentiary hearing regarding the Thompson Building, Kircher’s
attorney made the following statement:
[Kircher’s attorney]: I respectfully submit, Your Honor, that we first ought to do what the
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Court said. Specify what were the fire hazards that existed back in 2001 with
specificity that justified the continuation of this action. Then we’d like to go in and
see the property. Mr. Kircher has not been [at the Thompson Building] for three
years. We don’t aren’t ready for an evidentiary hearing without ever seeing whether
they actually did what they said they were going to do.
(D.E. No. 91-7)
At the July 22, 2004 evidentiary hearing, the circuit court expressly stated that it was not
addressing any constitutional issues. (Pl.’s & Defs.’ Stmts. at ¶ 62).
On September 2 – 3, 2004, Kircher filed England Reservations in each of the City’s nuisance
abatement cases and foreclosure cases. (Id. at ¶ 63). Each of those submissions stated that Kircher
“does hereby reserve his right to have his federal defenses and federal counter-claims ultimately
resolved in federal court.”
The Thompson Building was sold to successor receiver Beal at a sheriff’s sale on May 11,
2006. (Pl.’s & Defs.’ Stmts. at ¶ 65). By the time of the May 11, 2006 sheriff’s sale of the
Thompson Building, the lien on the property in favor of the receiver increased to $346,186.39. (Id.
at ¶ 66).
On May 17, 2006, Stewart Beal, the successor receiver, published his plans to “convert the
old structure into restaurants, shops, offices, and loft apartments.” (Id. at ¶ 67).
In its January 9, 2007 opinion, the Court of Appeals held:
Nonetheless, to date the circuit court has never amended its original order or
issued a new order to limit or otherwise narrow the scope of the receiver’s authority.
To make matters worse, the circuit court entered an order replacing the original
receiver with a successor receiver on March 21, 2005--nearly eleven months after we
issued our remand instructions in Ypsilanti Fire Marshal. The order appointing the
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successor receiver made no mention of this Court’s remand instructions, and in no
way limited the authority or power of the successor receiver as required by this
Court's directive. Instead, the circuit court left unchanged the framework under which
the original receiver had operated, allowing the successor receiver to merely continue
in the shoes of the original receiver and to carry on virtually unlimited repairs and
renovations to the Thompson Building without first seeking judicial permission or
approval.
....
Despite this Court's explicit instructions, the circuit court permitted the
receiver--and then the successor receiver--to continue unchecked and unsupervised,
running up substantial costs and only seeking approval long after the charges were
already incurred. Indeed, much of the confusion in these consolidated cases stems
from the circuit court's failure to comply with our April 27, 2004 remand
instructions. Our instructions were not intended as meaningless directives with no
design, purpose, or reason. Instead, they were meant to bring the circuit court's
existing orders into compliance with established legal rules and to effect the
organized and systematic progress of this complex litigation.
....
On remand, the trial court shall separate the individual costs incurred to abate violations of
the Fire Prevention Code from the individual costs incurred to abate all other nuisances under
the Ypsilanti building and fire codes.
....
Kircher claims several errors with respect to the trial court’s calculation of the
lien amount, the trial court’s foreclosure on the lien, and the trial court's order
directing that the property be sold.
....
When successor receiver Beal purchased the Thompson Building at the May 11, 2006,
sheriff’s sale, he took the property with full knowledge that further repairs and expenditures
might be necessary to bring the property into complete compliance with Ypsilanti city codes.
Having served as successor receiver of the property, Beal was clearly aware of the Thompson
Building’s physical condition at the time of sale. In short, when Beal purchased the property,
the original reasons for the receivership ceased to exist. As record owner, Beal himself
became responsible for any further necessary repairs. We conclude that the trial court abused
its discretion by failing to terminate the successor receivership at the time of the May 11,
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2006, sheriff's sale of the Thompson Building. Upon Beal’s purchase of the property, there
remained no further need for a receiver. Beal was fully aware at the time of sale that further
repairs might be necessary to abate additional code violations, but purchased the property
notwithstanding this knowledge. Moreover, as purchaser and owner, Beal was able,
following the sale, to personally effectuate any further necessary repairs without the
assistance of a court-appointed receiver. On remand, the trial court shall enter an order
terminating the receivership as of May 11, 2006. All costs incurred beyond that date by the
successor receiver—with the exception of necessary interest, tax, and insurance costs
incurred between the date of sale and the end of the redemption period—are the
responsibility of Beal as record owner of the Thompson Building.
Ypsilanti Fire Marshal v. Kircher, 273 Mich. App. 496, 535 & 541 (2007).
The Court of Appeals further held that an after-the-fact hearing was not equivalent to the
right to challenge costs before they were incurred:
Because the remand instructions were not followed, and the circuit court did
not approve the costs of repairs and renovations before they were incurred, Kircher
necessarily received no opportunity to contest the individual costs incurred by Barnes
or to offer evidence in response to the individual proposed projects at the Thompson
Building. We recognize that Judge Shelton held after-the-fact evidentiary hearings
in an attempt to comply with our remand instructions, and that after these hearings
he ultimately approved virtually all of the incurred costs. However, we cannot
determine whether Judge Shelton's findings were clearly erroneous because we are
not sufficiently presented with competing evidence, which surely would have been
offered by the parties had this matter proceeded as directed under our April 27, 2004
opinion. The circuit court's after-the-fact approval of the numerous expenses incurred
in this matter does not afford us the opportunity for meaningful review that would
have followed from an organized cost-by-cost determination in the court below.
Moreover, we cannot omit mention of the real possibility that by reserving review of
all expenses until after the repairs and renovations were already completed, Judge
Shelton in effect preordained his decision to allow or disallow each individual
expenditure. It is much less subjective to evaluate the propriety of proposed repairs
before they are begun than after the work is finished and the costs are already
incurred.
Id. at 533.
18
Again, that Opinion stated “[i]n light of our resolution of these consolidated appeals, we
decline to address the constitutional issues raised by Kircher in these cases” but then included a
footnote ruling no unconstitutional taking occurred. Id. at 533.
On remand from the Court’s January 9, 2007 Opinion, the circuit court upheld all charges
by the receiver at an after-the-fact-evidentiary hearing. (Pl.’s & Defs.’ Stmts. at ¶ 71)
Kircher appealed to the Court of Appeals three more times concerning the Thompson
Building and the Cross Street Property. The first two appeals ended with remands to the circuit court
for more clarification regarding the liens and the last appeal was denied. (Id. at ¶ 72).
III.
The Perrin Property
On July 30, 2001, the City filed a “Complaint for Nuisance Abatement and/or Raze the
Building and Order to Show Cause” regarding the Perrin Property. (Pl.’s & Defs.’ Stmts. at ¶ 73).
On November 22, 2001, the circuit court entered an order appointing Harry Hutchinson as receiver.
(Id. at ¶ 74).
Although the court held a Show Cause hearing on September 21, 2001, no evidentiary
hearing took place between July 30, 2001 and November 22, 2001. (Id. at ¶ 75).
On June 25, 2002 the City’s Building Official, Charles Boulard sent a letter to Kircher
refusing Kircher’s prior request for reinspection of the repairs Kircher had made to the Perrin
Property. (Id. at ¶ 76).
On July 12, 2002, Barnes was appointed as a successor receiver. (Id. at ¶ 77).
No evidentiary hearing was held between November 22, 2001 and July 12, 2002. (Id. at ¶
78).
19
Kircher attempted to appeal the circuit court’s orders to the Court of Appeals on August 2,
2002. But the appeal was dismissed by the Court of Appeals as premature on November 15, 2002
because the circuit court order appointing the receiver was not a final order. (Pl.’s & Defs.’ Stmts.
at ¶¶ 79-80).
Kircher filed a motion to terminate the receivership on December 4, 2002, which was denied
by the circuit court on December 20, 2002. (Id. at ¶ 81).
A no progress notice was issued on August 26, 2003 and an order dismissing the case was
entered on October 15, 2003. (Id. at ¶ 83).
On November 14, 2003, Barnes filed a complaint to foreclose the liens against the Perrin
Property. (Id. at ¶ 84).
The case was reinstated on December 26, 2003 by sua sponte order. (Id. at ¶ 85).
Another no progress notice was issued by the circuit court on May 24, 2004. (Id. at ¶ 86).
On July 1, 2004, Plaintiff filed his Complaint in the United States District Court for the
Eastern District of Michigan concerning constitutional violations regarding the Cross Street Property.
On July 9, 2004, Plaintiff amended his Complaint as of right to state constitutional claims regarding
the Cross Street Property, the Perrin Property and the Thompson Building. (Id. at ¶¶ 87-88).
A final dismissal of this state-court case for no progress was entered on July 12, 2004. (Id.
at ¶ 89).
Kircher appealed the July 12, 2004 circuit court order to the Court of Appeals, but it was
again dismissed by the Court of Appeals because it was not a final order. (Id. at ¶ 90).
On September 2 – 3, 2004, Kircher filed England Reservations in each of the City’s nuisance
abatement cases and foreclosure cases. (Id. at ¶ 91).
20
Kircher filed a motion to reinstate the case before the trial court for final adjudication of the
matter so that he could appeal the decision. The circuit court denied Kircher’s motion to reinstate
the case, and the Court of Appeals affirmed the denial in its March 13, 2008 Opinion. (Pl.’s & Defs.’
Stmts. at ¶¶ 92-93).
ANALYSIS
In their Motion to Dismiss, Defendants challenge Plaintiff’s claims in this action on
numerous grounds. The Court need not reach them all.
I.
The Rooker-Feldman Doctrine Does Not Apply Here.
Defendants first appear to assert that this Court lacks subject matter jurisdiction under the
Rooker-Feldman doctrine.
“The Rooker-Feldman doctrine,” however, “is confined to cases of the kind from which
the doctrine acquired its name: cases brought by state-court losers complaining of injuries caused
by state-court judgments rendered before the district court proceedings commenced and inviting
district court review and rejection of those judgments.” Exxon Mobil Corp. v. Saudi Basic Indus.
Corp., 544 U.S. 280, 284 (2005) (emphasis added). Thus, a court must consider whether each of
those elements is met. See Iannucci v. State, 2017 WL 3951849 (6th Cir. 2017) (quoting Exxon
Mobil Corp. and numbering the required elements, including the third element, that the state
court judgment must have been “rendered before the district court proceedings commenced”).
Accordingly, as Judge Rosen recognized in addressing a prior motion to dismiss in this
case, Plaintiff’s claims are not barred by the doctrine because the state-court actions remained
pending when this federal case was commenced. (See D.E. No. 38 at Pg ID 925-28); Exxon
Mobil Corp., supra; Hunter v. Hamilton Cty. Bd. of Elections, 635 F.3d 219, 233 (6th Cir. 2011)
21
(explaining that Rooker-Feldman doctrine did not apply because the state-court judgment at issue
was issued nearly seven weeks after the plaintiff filed her federal case.).
As explained in Exxon Mobil Corp., the limited Rooker-Feldman doctrine “does not
otherwise override or supplant preclusion doctrine.” Exxon Mobil Corp., 544 U.S. at 284. That
is, the doctrine does not support “the notion that properly invoked concurrent jurisdiction
vanishes if a state court reaches judgment on the same or related question while the case remains
sub judice in a federal court.” Id. at 292. Rather, “[d]isposition of the federal action, once the
state-court adjudication is complete, would be governed by preclusion law.” Id. at 293.
That leads into other arguments presented by Defendants, that Plaintiff’s claims in this
action are barred by the preclusive effect of the state-court rulings and judgments.
II.
Plaintiff’s Constitutional Claims Are Barred By The Preclusive Effect Of
The State-Court Rulings And Judgments.
“A federal court must give a state court judgment the same preclusive effect it would
have in the courts of the rendering state.” Dubuc v. Green Oak Twp., 312 F.3d 736, 744 (6th Cir.
2002). As such, as the parties recognize, the preclusive effect of the state court judgments at
issue in this case must be determined by Michigan law. See Buck v. Thomas Cooley Law Sch.,
597 F.3d 812, 817 (6th Cir. 2010).
“Michigan recognizes two preclusion doctrines: res judicata (or claim preclusion) and
collateral estoppel (or issue preclusion).” Adams v. JPMorgan Chase Bank, N.A., 2017 WL
2819231 at * 2 (6th Cir. 2017).
A.
Res Judicata (Claim Preclusion)
“The doctrine of res judicata is employed to prevent multiple suits litigating the same
22
cause of action.” Adair v. State, 470 Mich. 105, 120 (2004). As explained by the Sixth Circuit,
under Michigan law, a second, subsequent action is barred by res judicata when: 1) the prior
action was decided on the merits, 2) both actions involve the same parties or their privies, and 3)
the matter in the second case was, or could have been, resolved in the first. AuSable River
Trading Post, LLC v. Dovetail Solutions, Inc., 874 F.3d 271, 274 (6th Cir. 2017). “Res judicata is
applied broadly by Michigan courts, barring ‘not only claims already litigated, but also every
claim arising from the same transaction that the parties, exercising reasonable diligence, could
have raised but did not.’” Id.
Here, there does not appear to be any dispute as to the first two elements, as the state
court actions were decided on the merits and involve the same parties. What is in dispute is the
final element – whether the constitutional claims that Plaintiff wants to bring here in federal
court were, or could have been, resolved in the state-court cases.
Plaintiff’s papers reference his “claims” in the state-court action and assert that Plaintiff’s
“constitutional claims were not decided on the merits” in the state court. (Pl.’s Br. at 10). But as
Plaintiff’s counsel confirmed on the record at the April 12, 2018 hearing, Plaintiff did not assert
any takings or due process counter-claims in the state-court action.
Again, res judicata “bars not only claims already litigated, but also every claim arising
from the same transaction that the parties, exercising reasonable diligence, could have raised but
did not.” Buck, 597 F.3d at 817. The Court concludes that Plaintiff’s claims are barred by res
judicata because Plaintiff could have presented his takings and due process claims during the
course of the protracted state-court litigation but he chose not to do so. Indeed, Judge Rosen’s
23
October 10, 2006 Opinion & Order gave Plaintiff’s Counsel a very clear warning that the
constitutional claims he sought to assert in this action would very likely be barred by re judicata
and/or collateral estoppel if he were to attempt to return to federal court after the conclusion of
the state-court proceedings. (See D.E. No. 38 at Pg ID 934).
In seeking to avoid the application of res judicata, Plaintiff asserts that his constitutional
claims could not have been brought in the state court because those actions were commenced in
2001 and 2002, and the “events giving rise to Plaintiff’s constitutional claims arose after the state
court proceeding commenced.” (Pl.’s Br. at 8). It does not matter that Plaintiff could not have
brought the takings or due process claims on the dates on which the cases began. “[U]nder
Michigan law, a plaintiff has a duty to supplement her complaint with related factual allegations
that develop ‘during the pendency of’ her state suit or have them barred by res judicata.” Buck,
597 F.3d at 817. Plaintiff could have, and should have, raised any takings and/or due process
claims during the course of the protracted state-court litigation.
B.
Collateral Estoppel (Issue Preclusion)
Under Michigan law, issue preclusion applies when: 1) there is identity of parties across
pleadings; 2) there was a valid, final judgment in the first proceeding; 3) the same issue was
actually litigated and determined in the first action; 4) the party against whom the doctrine is
asserted had a full and fair opportunity to litigate the issue in the earlier proceeding. Darrah v.
City of Oak Park, 255 F.3d 301, 311 (6th Cir. 2001).
Again, the prior actions were decided on the merits, after the parties had the opportunity
to present their arguments, and the cases involve the same parties. What is in dispute is whether
the issue was determined in the state-court actions.
24
Plaintiff asserts that he “attempted to raise the constitutional issue to the state court” but
the state court refused to consider it. (D.E. No. 91 at Pg ID 1682). To support that argument,
Plaintiff directs the Court to the line in the 2007 opinion wherein the Court said, “In light of our
resolution of these consolidated appeals, we decline to address the constitutional issues raised by
Kircher in these cases.” Ypsilanti Fire Marshal v. Kircher, 273 Mich.App. at 555. In a footnote
to that sentence, however, the Michigan Court of Appeals nevertheless considered and rejected
Kircher’s constitutional takings argument:
Relying on Wayne Co. v. Hathcock, 471 Mich. 445; 684 N.W.2d
765 (2004), Kicher cursorily suggests that his properties have been
taken by Ypsilanti without just compensation. Even assuming the
requisite state action could be demonstrated, we disagree with
[Plaintiff]’s contention, which disregards the well-established
nuisance exception to the prohibition on governmental takings. The
federal and state constitutions both proscribe the taking of private
property for public use without just compensation. The Takings
Clause of the Fifth Amendment is substantially similar to the
Takings Clause of the Michigan Constitution, and the two provisions should generally be
interpreted coextensively. The nuisance exception to the prohibition on unconstitutional takings
provides that because no individual has the right to use his or her property so as to create a
nuisance, “the [s]tate has not ‘taken’ anything when it asserts its power to enjoin [a] nuisancelike activity.” Indeed, “[c]ourts have consistently held that a [s]tate need not provide
compensation when it diminishes or destroys the value of property by stopping illegal activity or
abating a public nuisance.” Because Ypsilanti was exercising its legitimate police power to abate
the alleged nuisances on Kircher’s property, no unconstitutional taking occurred.
(Id.).
Id. (emphasis added).
And a later panel of the Michigan Court of Appeals considered that footnote a ruling on
the takings issue, as it stated: “the majority of the issues raised by Kircher are merely a rehashing
of issues raised in previous appeals before this Court such as his contentions regarding the trial
court’s lack of jurisdiction, . . . the award of attorney and receiver fees and the existence of a
25
conspiracy between Ypsilanti and Barnses to effectuate an unconstitutional taking of Kircher’s
properties. As each of these issues has been addressed repeatedly in both the trial court and
before this Court, we find no need to go into further or extensive detail regarding these claims.
It is sufficient to note that since all of these issues have been previously addressed and ruled
on they are precluded from reexamination by the law of the case doctrine.” Ypsilanti Fire
Marshal v. Kircher, 2011 WL 6187067 (Mich. App. 2011) (emphasis added).
In addition, the Michigan Court of Appeals has since cited to the 2007 decision to support
the proposition that there is a nuisance exception to takings claims. See Ligon v City of Detroit,
739 N.W.2d 900, 908 n5, 276 Mich. App. 120, 132 (2007)(“As the City points out, there is a
well-recognized nuisance exception to the Takings Clause of the Fifth Amendment.”); Wayne
Cty. Exec. v. Aggor, No. 266183, 2007 WL 2067936, at *2 (Mich. Ct. App. July 19,
2007)(“Indeed, “[c]ourts have consistently held that a [s]tate need not provide compensation
when it diminishes or destroys the value of property by stopping illegal activity or abating a
public nuisance.”)
Accordingly, the Court concludes that issue preclusion applies as well.
C.
Plaintiff’s England Reservation Of Rights Argument Is Rejected.
In opposing Defendants’ Motion to Dismiss, based on the preclusive effects of the state
court judgments, Plaintiff asserts that he can avoid preclusion and may proceed with his federal
claims because he filed an England reservation of rights in each of the three state-court cases.
In the case England v. Louisiana State Bd. of Med. Exam’r’s, 375 U.S. 411 (1964), the
“Supreme Court established a procedure by which a party, whose case is partially remanded to
26
the state courts pursuant to the Pullman abstention doctrine,1 may reserve the right to litigate
the federal claims in the federal court.” Anderson v. Charter Twp. of Ypsilanti, 266 F.3d 487,
495 (6th Cir. 2001) (bolding added for emphasis).
As the Supreme Court has explained, England reservations of rights developed to address
a very specific scenario – cases that “involve federal constitutional challenges to a state statute
that can be avoided if a state court construes the statute in a particular manner.” San Remo Hotel,
L.P. v. City and Cnty. of San Francisco, 545 U.S. 323, 339 (2005).
Nevertheless, some courts, including the Sixth Circuit, expanded the use of England
reservations of rights beyond that narrow group of cases, to other types of cases, including
takings cases. See, e.g., DLX, Inc. v. Kentucky, 381 F.3d 511, 523 (6th Cir. 2004) (holding that a
party’s England reservation of federal takings claims in a state takings action will suffice to
defeat claim preclusion in federal case, but declining to consider it if will suffice to defeat issue
preclusion).
In 2005, however, the Supreme Court issued San Remo Hotel, which changed the
landscape on this issue. The Court noted that the “purpose of the England reservation is not to
grant plaintiffs a second bite at the apple in their forum of choice,” and rejected the plaintiff’s
assertion they have a “right to vindicate their federal claims in a federal forum.” San Remo
Hotel, 545 U.S. at 342 & 346. The Court explained that “Congress has not expressed any intent
to exempt from the full faith and credit statute federal takings claims. Consequently, we apply
1
“Pullman abstention does not involve the abdication of federal jurisdiction, but rather,
the postponement of its exercise, “which differentiates its from other forms of federal judicial
abstention.” Jones v. Coleman, 848 F.3d 744, 749 (6th Cir. 2017). Pullman abstention is
appropriate in a scenario in which a “state-law question is unsettled” and is best decided by the
state court. Id.
27
our normal assumption that the weighty interests in finality and comity trump the interest in
giving losing litigants access to an additional appellate tribunal.” Id. at 345. The Court
recognized the practical reality that “a significant number of plaintiffs will necessarily litigate
their federal takings claims in state courts” and that most takings cases come to the Supreme
Court only through writs of certiorari from state courts of last resort. Id. 347. But it nevertheless
rejected the plaintiffs claim that it would be unfair to give preclusive effect to state-court takings
proceedings that the plaintiffs did not chose:
Moreover, this is not the only area of law in which we have
recognized limits to plaintiffs’ ability to press their federal claims
in federal courts. See, e.g., Fair Assessment in Real Estate Assn.,
Inc. v. McNary, 454 U.S. 100, 116, 102 S.Ct. 177, 70 L.Ed.2d 271
(1981) (holding that taxpayers are “barred by the principle of
comity from asserting § 1983 actions against the validity of state
tax systems in federal courts”). State courts are fully competent to
adjudicate constitutional challenges to local land-use decisions.
Indeed, state courts undoubtedly have more experience than federal
courts do in resolving the complex factual, technical, and legal
questions related to zoning and land-use regulations.
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 347-48.
As a result, following San Remo Hotels, courts have rejected the reservation of rights
argument that Plaintiff makes here. See, e.g., Knutson v. City of Fargo, 2008 WL 879735 (D. N.
Dakota 2008) (“In San Remo Hotel, the Supreme Court soundly rejected the notion that a
28
plaintiff could somehow reserve his claims or that preclusion doctrines do not apply in takings
proceedings, leaving the [plaintiffs] with no claim that may be heard in federal court.”); Edwards
v. City of Joneboro, 2010 WL 2228444 (E.D. Ark. 2010) (“The Court’s holding in San Remo
Hotel squarely stands for the proposition that a land owner can not ‘reserve’ his federal
constitutional taking claims in the state court action . . . instead, the land owner must assert and
pursue his federal taking claims as part of that state court action. Otherwise, the preclusive effect
of the state court judgment will bar the land owner from later coming into federal court to assert
a federal taking claim.”).
In opposing Defendants’ Motion to Dismiss, based on the preclusive effects of the state
court judgments, Plaintiff asserts that he can avoid preclusion and may proceed with his federal
claims because he filed an England reservation of rights in each of the three state-court cases.
This argument is rejected for several reasons.
First, Judge Rosen did not remand this case to the state court under the Pullman
abstention doctrine. Rather, he remanded it based upon the Younger abstention doctrine and that
matters. “A district court may abstain under the Younger doctrine if three conditions exist: there
are state proceedings that are (1) currently pending; (2) involve an important state interest; and
(3) will provide the federal plaintiff with an adequate opportunity to raise his or her
constitutional claims.” Nimer v. Litchfield Twp. Bd. Of Trustees, 707 F.3d 699, 700 (6th Cir.
2013) (bolding added for emphasis).
“The rationale for allowing reservation of a federal claim in a state court proceeding
following Pullman abstention in a federal court is thus not applicable to Younger abstention”
and, therefore, “a federal plaintiff may not avoid preclusion by reserving in the state court its
29
federal claims following Younger abstention.” Temple of Lost Sheep, Inc. v. Abrams, 930 F.2d
178, 183 (2d Cir. 1991); see also Beltran v. California, 871 F.2d 777, 783 n.8 (9th Cir. 1988)
(Explaining that “when Younger abstention applies, federal plaintiffs cannot reserve their federal
claim from state court adjudication for later decision by the federal court.”) That is because, if “a
federal plaintiff could avoid the preclusive effects of the related state court proceeding by
reserving its federal claims after the federal court abstains under Younger, then the federal court
would fail to give effect to the ability of the state court to resolve federal constitutional questions,
thereby undermining one of the central purposes behind Younger abstention. Moreover, such an
approach would result in at least partially duplicative proceedings, one of the problems that
Younger abstention attempts to remedy.” Temple of Lost Sheep, 930 F.2d at 183.
Accordingly, this reason alone warrants the rejection of Plaintiff’s argument that he can
avoid the preclusive effect of the state court judgments because of his England reservations of
rights.
Second, the Supreme Court’s decision in San Remo Hotel also forecloses Plaintiff’s
position that he can reserve his takings claim by virtue of an England reservation of rights,
especially where the state court made a ruling on the takings issue.
Third, while some courts had extended England reservations to takings claims, Plaintiff
has offered no authority that would indicate he can make such a reservation for due process
claims and the Court has found no such authority.2
This Court therefore rejects Plaintiff’s argument that he can now litigate his federal
2
In addition, while Mr. Ward filed England reservation of rights in the state-court cases,
they said he was reserving his “federal counter-claims” and, as noted above, Plaintiff never
actually asserted any takings or due process counter-claims in the state-court cases.
30
claims in this action by virtue of having filed England reservations of rights in the state court
cases.
CONCLUSION & ORDER
For the reasons stated above, IT IS ORDERED that Plaintiff’s motion for leave to file an
amended complaint is DENIED and Defendants’ Motion to Dismiss is GRANTED.
IT IS SO ORDERED.
s/Sean F. Cox
Sean F. Cox
United States District Judge
Dated: April 17, 2018
I hereby certify that a copy of the foregoing document was served upon counsel of record
on April 17, 2018, by electronic and/or ordinary mail.
s/Teresa McGovern
Case Manager Generalist
31
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