WATERFRONT RENAISSANCE ASSOCIATES v. THE CITY OF PHILADELPHIA

Filing 242

MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE LAWRENCE F. STENGEL ON 11/4/11. 11/4/11 ENTERED AND COPIES MAILED AND E-MAILED: COPIES MAILED TO UNREPRESENTED PARTY.(kw, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
CMR D.N. CORP. AND MARINA
TOWERS LTD. T/AWATERFRONT
RENAISSANCE ASSOCIATES,
Plaintiffs
v.
CITY OF PHILADELPHIA, et al.,
Defendants

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CIVIL ACTION

No. 07-1045

MEMORANDUM

STENGEL, J.

November 4, 2011

This case involves a private real estate developer’s efforts to build a World Trade
Center along the Delaware River in Philadelphia. The developer, Waterfront
Renaissance Association (“WRA”), contends the City thwarted the project by changing
its zoning laws and by imposing certain unfair requirements through its Planning
Commission. Several claims have already been dismissed. The parties filed cross
motions for summary judgment on Count XVI, which alleges the City’s Central
Delaware Riverfront Overlay District and plan of development regulations are
unconstitutional. The City also seeks summary judgment on WRA’s promissory estoppel
and detrimental reliance claims (Count III and IV) and WRA’s claim for Unjust
Enrichment (Count VIII). For the reasons discussed in this memorandum opinion, I will
grant the City’s motions and deny the Plaintiff’s.

I.

BACKGROUND
Waterfront Renaissance Associates is a Pennsylvania limited partnership seeking

to develop a “major World Trade Center” located at 400-456 North Columbus Boulevard,
Philadelphia, Pennsylvania. From 1987 through 1989, Waterfront Renaissance
negotiated with the City of Philadelphia Planning Commission to re-zone the site to C-4
zoning. In 1989, WRA met with three civic associations, which led to an agreement
whereby the Civic Associations would support re-zoning the site to C-4 to enable the
development of the WRA project in return for a twenty-year Zoning Covenant from
WRA. Under the Zoning Covenant, WRA agreed to certain design specifications to
address concerns raised by the Civic Associations. In return, the Civic Association
Defendants agreed to “support and assist the Covenanter [WRA] in obtaining any and all
permits and variances that may be necessary to use and/or develop said premises in
accordance with the below listed restrictions and conditions.” (Doc. #2111 at ¶ 48).
In March 2001, after a series of cooperative efforts involving the Delaware River
Port Authority (DRPA), WRA and the City, the Pennsylvania Department of Community
and Economic Development granted Keystone Opportunity Zone (“KOZ”) status to
WRA’s site, and eleven and a half (11.5) acres of City-owned property around it. KOZ
status confers tax abatements at the state and local levels for qualified businesses that
lease real property in the KOZ. The KOZ distinction made the property more valuable
and would, presumably, attract new businesses to the site. WRA expended resources to

1

Plaintiff’s Third Amended Complaint, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045
(E.D. Pa. filed April 4, 2011).

2

obtain the application, including hiring a lobbyist, Steven Wojcik and Associates, to
promote the granting of KOZ status. (Oral Argument Transcript Doc. #239 at 34 ¶¶ 1725).
On March 5, 2009, Philadelphia City Councilman Frank DiCicco introduced Bill
090170-A, which the City Council approved, to create a zoning overlay (“CRO”) for the
Central Delaware Riverfront Overlay District.2 WRA’s site is within this overlay district
and the requirements of the overlay district complicated the RA project. On April 20,
2010, the Planning Commission adopted regulations to implement the Plan of
Development process (the “POD Regulations”). (Doc. #211 at ¶ 180e). The POD is
submitted in order that the Planning Commission can ensure accordance with the overall
planning strategy for the Central Delaware Riverfront.
On September 16, 2010, the Planning Commission filed the revised POD
Regulations with the Philadelphia Department of Records. The revised POD Regulations
became effective at midnight on September 27, 2010 pursuant to Section 8-407 of the
2

The Central Delaware Riverfront Overlay District is codified at Section 14-1638 of the Philadelphia Code. The
Central Delaware Riverfront Overlay District provides:
For all properties east of Columbus Boulevard/Delaware Avenue or adjacent to the
Delaware River and for all other commercially zoned properties, no zoning permits shall
be issued unless (i) the applicant shall have first submitted to the City Planning
Commission, and the City Planning Commission shall have approved, a Plan of
Development, which shall be approved by the Commission only if the Commission, in its
discretion, has determined that the Plan of Development provides for development
appropriate in scale, density, character and use for the surrounding community, and (ii)
the Planning Commission determines that the requested permits are in conformity with
the approved Plan of Development. If the Commission fails to approve, disapprove,
conditionally approve or table a proposed Plan of Development within seventy-five (75)
days after submission of complete plans to the Commission, the approval of the
Commission shall be presumed. Within one hundred eighty (180) days of the effective
date of this Ordinance the Commission shall adopt regulations providing objective
standards for such design review as may be necessary, prior to implementing the
provisions of this subsection 12.
Phila., Pa., The Philadelphia Code § 14-1638(12)(a) (2010).

3

Philadelphia City Charter. (Doc. #211 at ¶ 304). Subsection 13 of the CRO states that
the Planning Commission shall approve a POD “only if the Commission has determined,
in its discretion, that the Plan of Development provides for development appropriate in
scale, density, character and use for the surrounding community.” (Doc. #211 at ¶ 311;
Exhibit J at 5-6). The parties’ main contention is whether the CRO and POD Regulations

are overly vague or result in arbitrary and capricious application.
II.

PROCEDURAL HISTORY
WRA commenced this civil action in February 2007 by filing a fourteen-count

complaint in the Court of Common Pleas of Philadelphia County against the City of
Philadelphia, the Civic Associations for the surrounding neighborhoods, and a number of
individual defendants. The defendants removed the case to this court on March 15, 2007.
The original Complaint challenged a March 2006 ordinance that extended a 65 foot
height restriction to the area north of Old City, which included property owned by
Waterfront Renaissance.
The individual defendants were dismissed on 12(b)(6) motions, which left only the
claims against the Civic Association and the City. Waterfront Renaissance Assocs. v.
City of Philadelphia, 2008 U.S. Dist. LEXIS 25868 (E.D. Pa. Mar. 31, 2008). In 2011,
the Civic Associations’ Motion for Summary Judgment was granted. CMR D.N. Corp. v.
City of Phila., 2011 U.S. Dist. LEXIS 25392 (E.D. Pa. Mar. 10, 2011). Additionally, in
2011, the constitutional challenge to the March 2006 ordinance was dismissed as moot.
CMR D.N. Corp. v. City of Phila., 2011 U.S. Dist. LEXIS 25387 (E.D. Pa. Mar. 10,
2011).
4

WRA has since filed an amended complaint solely against the City of Philadelphia
challenging the new ordinance and the POD and maintaining claims for promissory
estoppel and unjust enrichment. (Doc. #211). The City then filed a motion for summary
judgment on July 29, 2011 (Doc. #2233). That same day WRA filed a partial motion for
summary judgment on Count XVI (Doc. #2244). The motions are well and fully briefed
and I had the benefit of hearing oral argument on the motions from counsel.
III.

STANDARD
Summary judgment is appropriate “if the movant shows that there is no genuine

dispute as to any material fact and that the movant is entitled to judgment as a matter of
law.” FED. R. CIV. P. 56(a). A dispute is “genuine” when “a reasonable jury could return
a verdict for the nonmoving party” based on the evidence in the record. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is “material” when it
“might affect the outcome of the suit under the governing law.” Id.
A party seeking summary judgment initially bears responsibility for informing the
court of the basis for its motion and identifying those portions of the record that “it
believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986). Where the non-moving party bears the burden of
proof on a particular issue at trial, the moving party’s initial Celotex burden can be met
simply by demonstrating to the district court that “there is an absence of evidence to

3

Defendant’s Motion for Summary Judgment, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 071045 (E.D. Pa. filed July 29, 2011).
4

Plaintiff’s Partial Motion for Summary Judgment on Count 16 of the Third Amended Complaint, CMR D.N. Corp.
and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D. Pa. filed July 29, 2011).

5

support the non-moving party’s case.” Celotex, 477 U.S. at 325. After the moving party
has met its initial burden, the adverse party’s response “must – by affidavits or as
otherwise provided in this rule – set out specific facts showing a genuine issue for trial.”
FED. R. CIV. P. 56(e)(2). Summary judgment is therefore appropriate when the nonmoving party fails to rebut by making a factual showing that is “sufficient to establish the
existence of an element essential to that party’s case, and on which that party will bear
the burden of proof at trial.” Celotex, 477 U.S. at 322.
Under Rule 56 of the Federal Rules of Civil Procedure, the court must draw “all
justifiable inferences” in favor of the non-moving party. Anderson, 477 U.S. at 255. The
court must decide “not whether . . . the evidence unmistakably favors one side or the
other but whether a fair-minded jury could return a verdict for the plaintiff on the
evidence presented.” Id. at 252. If the non-moving party has produced more than a
“mere scintilla of evidence” demonstrating a genuine issue of material fact, then the court
may not credit the moving party’s “version of events against the opponent, even if the
quantity of the [moving party’s] evidence far outweighs that of its opponent.” Big Apple
BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).
IV.

DISCUSSION
A. Constitutional Claims
The plaintiff contends the Central Riverfront Overlay District (“CRO”) regulations

and the Planning Commission’s Plan of Development (“POD”) provisions are
unconstitutional. Specifically, WRA alleges the CRO and the POD regulations violate

6

the principles of substantive due process and equal protection. The City contends that
these claims are not ripe and have no merit.
The ripeness doctrine “serves to determine whether a party has brought an action
prematurely[.]” Khodara Envtl. Inc. v. Blakey, 376 F.3d 187, 196 (3d Cir. 2004). In
land-use cases, a property owner’s constitutional claim will not be ripe until the zoning
authorities have had an opportunity to arrive at a final, definitive position regarding the
application of the regulations at issue. See Sameric Corp. of DE v. City of Philadelphia,
142 F.3d 582 (3d Cir. 1998); Acierno v. Mitchell, 6 F.3d 970, 975 (3d Cir. 1993);
Hoehne v. Cnty of San Benito, 870 F.2d 529, 533 (9th Cir.1989). Under this “finality
rule,” a plaintiff property owner must prove that a “final decision has been reached by the
agency before it may seek compensatory or injunctive relief in federal court on federal
constitutional grounds.” Acierno, 6 F.3d at 975. The finality rule, however, does not
apply to facial challenges because a facial challenge argues “any application of the
regulation is unconstitutional.”5 Cnty Concrete Corp., 442 F.3d at 164; See also Cornell

5

In Cornell Cos. v. Borough of New Morgan, 512 F. Supp. 2d 238, 256 (E.D. Pa. 2007), this Court outlined the
appropriate analysis for applying the finality rule to constitutional claims in zoning cases:
The ripeness of a claim alleging a constitutional violation in the land-use and zoning arena
depends upon whether the plaintiff is raising (1) an “as-applied” challenge or (2) a facial attack on
a zoning ordinance. In an as-applied case, the plaintiff is contending that the defendant municipal
agency violated his or her constitutional rights in the manner in which an ordinance was applied to
his or her property. The finality rule can bar an as-applied challenge because “only once a ‘[local]
decision maker has arrived at a definitive position on the issue’ has a property owner been
inflicted with 'an actual, concrete injury.’” Cnty Concrete, 442 F.3d 159 (quoting Williamson
Cnty Regional Planning Com. v. Hamilton Bank, 473 U.S. 172, 192 (1985)).
Facial attacks on a zoning ordinance, on the other hand, do not implicate ripeness concerns or the
fear of a federal court overstepping its jurisdiction into local matters. The finality rule does not
apply "to facial attacks on a zoning ordinance, i.e., a claim that the mere enactment of a regulation
either constitutes . . . a substantive violation of due process or equal protection. A ‘final decision’
is not necessary in that context because when a landowner makes a facial challenge he or she

7

Cos. v. Borough of New Morgan, 512 F. Supp. 2d 238, 256 (E.D. Pa. 2007) (stating that
“[f]acial attacks on a zoning ordinance[s] … do not implicate ripeness concerns”).
Additionally, in Cnty Concrete, the Third Circuit held that when a plaintiff facially
attacks an ordinance the cause of action is ripe, even if the plaintiff did not seek a
variance from the zoning ordinance. Cnty Concrete, 442 F.3d at 256.
WRA asserts a claim against a provision of the ordinance, which requires
developers to submit a POD to the Planning Commission for approval.6 WRA alleges
that the language in the ordinance results in ad hoc application and that the approval
process acts as a bar to development. (Doc. #211 at ¶ 334). Plaintiffs also challenge the
ordinance facially, i.e., they allege that, in all of its possible applications the ordinance is
arbitrary, capricious, and not rationally related to any legitimate government interest.
The City argues that the finality rule should apply in this case because “unlike the
ordinances in Cornell and Cnty Concrete, there is nothing on the face of the CRO that
prohibits WRA from proceeding with its development.” 7 (Doc #223 at 8).

argues that any application of the regulation is unconstitutional . . . .” Cnty Concrete, 442 F.3d at
164 (internal quotations and citations omitted).
Id. at 256.
6

To obtain the Planning Commission’s approval, the applicant must demonstrate that “the Plan of Development
provides for development appropriate in scale, density, character, and use for the surrounding community.” Section
14-1638(13).
7

The City alleges that if a developer's project is in accordance with the zoning code and within the parameters of the
overall zoning plan for the riverfront, the project will be approved. Therefore, the bases of the finality rule are
implicated by the fact that the CRO does not directly prohibit a developer’s ability to execute a project. Id. Plaintiff
argues that the approval from the Planning Commission is, in fact, a bar to development and not a “mere formality.”
(Doc. #229 at 3). Stating that approval is “a condition to the issuance of a zoning permit, without which no
commercial development can occur in the Central Delaware Riverfront District.” Id.

8

The fact that WRA asserts a facial challenge to the ordinance meets the basic test
to withstand summary judgment on this issue because the Third Circuit has held that
facial challenges to ordinances ripen at the time of enactment. See County Concrete
Corp., 442 F.3d at 164. Even if WRA did not seek a variance from the zoning ordinance,
the Third Circuit has maintained that this type of facial attack is ripe for adjudication.
See Id. at 256. Accordingly, the finality rule does not apply to plaintiff’s substantive due
process challenge to the zoning ordinance asserted on the theory that the law as a whole
is arbitrary, capricious, and unreasonable, and Count XV is ripe for federal court review.
1.

Substantive Due Process
The Fourteenth Amendment to the United States Constitution prohibits

deprivations “of life, liberty, or property, without due process of law.” U.S. Const.
amend. XIV, § 1. To prevail on a substantive due process claim, a Plaintiff must
demonstrate that an arbitrary and capricious act deprived him of a protected property
interest. 8 Cnty Concrete Corp., 442 F.3d at 165 (citing Taylor Inv., Ltd. v. Upper Darby
Twp, 983 F.2d 1285, 1292 (3d Cir. 1993)). Additionally, the Plaintiff must show that the
law is not rationally related to a legitimate state interest. Pace Resources, Inc. v.
Shrewsbury Twp, 808 F.2d 1023, 1034 (3d Cir. 1987). In the context of constitutional
challenges to land use laws, the Third Circuit has held that “unless defendants’ actions
8

Nicholas v. Pennsylvania State Univ., explained the standard for violating substantive due process stating:
“typically, a legislative act will withstand substantive due process challenge if the government ‘identifies the
legitimate state interest that the legislature could rationally conclude was served by the statute.’” 227 F.3d 133, 139
(3d Cir. 2000). On the other hand, non-legislative or executive action violates substantive due process if “arbitrary,
irrational, or tainted by improper motive,” or if “so egregious that it 'shocks the conscience.’” Id. In a land-use
controversy, official conduct will not be deemed to “shock the conscience” absent allegations of corruption or selfdealing, bias against an ethnic group, interference with constitutionally-protected activity or a virtual “taking” of
property. Eichenlaub v. Twp. of Indiana, 385 F.3d 274, 285-86 (3d Cir. 2004).

9

were ‘completely unrelated in any way to a rational land use goal’ there is no [substantive
due process] violation.” Corneal v. Jackson Township, 94 Fed. Appx. 76, 2004 WL
790315 (3d Cir. 2004) (citing Cnty of Sacramento v. Lewis, 523 U.S. 833, 846 (1998)).
A second way to prevail on a claim that an ordinance is unconstitutional requires a
plaintiff to demonstrate that that an enactment is void for vagueness. It is a basic
principle of due process that an enactment is void for vagueness if its prohibitions are not
clearly defined.9 Grayned v. City of Rockford, 408 U.S. 104, 108-09 (1972). However,
the Supreme Court has held that regulations are not unconstitutionally vague where one
“may have the ability to clarify the meaning of a regulation by [his] own inquiry, or by
resort to administrative process.” Hoffman Estates v. Flipside, Hoffman Estates, 455
U.S. 489, 497-99 (1982). See also Price v. Smith, 416 Pa. 560, 566 (1965) (the phrase

9

But see Kissell v. Ferguson Twp. Zoning Hearing Bd., 729 A.2d 194, 197 (Pa. Commw. 1999) (finding that when
a word or term is undefined in a zoning ordinance, it is to be given its plain and ordinary meaning). Additionally, in
the criminal context, vagueness implicates a number of concerns. For instance, “laws must give the person of
ordinary intelligence a reasonable opportunity to know what is prohibited,” and laws must provide explicit standards
to “avoid resolution on an ad hoc and subjective basis, with the attendant dangers of arbitrary and discriminatory
application.” Grayned v. City of Rockford, 408 U.S. 104, 108-09 (1972). In the zoning context, however, this
argument does not have as much force. Adhi Parasakthi Charitable v. Twp. of W. Pikeland, 721 F. Supp. 2d 361,
380 (E.D. Pa. 2010). The United States Supreme Court has further detailed the appropriate review for vagueness
challenges to statutes:
The degree of vagueness that the Constitution tolerates--as well as the relative importance of fair
notice and fair enforcement–depends in part on the nature of the enactment. Thus, economic
regulation is subject to a less strict vagueness test because its subject matter is often more narrow,
and because businesses, which face economic demands to plan behavior carefully, can be expected
to consult relevant legislation in advance of action. Indeed, the regulated enterprise may have the
ability to clarify the meaning of the regulation by its own inquiry, or by resort to an administrative
process. The Court has also expressed greater tolerance of enactments with civil rather than
criminal penalties because the consequences of imprecision are qualitatively less severe.…
Finally, perhaps the most important factor affecting the clarity that the Constitution demands of a
law is whether it threatens to inhibit the exercise of constitutionally protected rights. If, for
example, the law interferes with the right of free speech or of association, a more stringent
vagueness test should apply.
Hoffman Estates v. Flipside, Hoffman Estates, 455 U.S. 489, 498-99 (1982).

10

“the character of the neighborhood” was “not so vague and indefinite that uniform
application could not be assured.”).
WRA alleges that the CRO and POD regulations violate the principle of
substantive due process because the review is impermissibly vague, is arbitrary and
capricious, and is unrelated to any legitimate planning purpose.10 (Doc. #233 at 9-10).11
WRA argues that the CRO fails to explain how the scale, density, character, and use that
are appropriate for the surrounding community differ from the scale, density, character,
and use that are permitted by a property’s base zoning. Additionally, WRA alleges that,
although the City states it does not add additional restrictions outside of the existing
zoning, the CRO includes regulations, such as the terms “appropriateness” 12 for the

10

WRA makes a facial attack on the City's use and application of zoning ordinances as arbitrary, capricious, and
unreasonable. WRA alleges that terms “existing characteristics of the built and natural environment that are
essential to achieving the working guidelines of the Civic Vision” and “appropriate in scale, density, character and
use” are not defined. It maintains the regulations do not provide quantitative or qualitative standards or guidelines
for evaluation of the factors, and, therefore, provide no guidance for which developments will be approved. See
Plaintiff's Memorandum of Law in Support of Motion for Leave to Supplement Complaint at 7-9, CMR D.N. Corp.
and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D. Pa. filed June 25, 2010); Plaintiff's Motion at Exh. 1 at
¶¶ 315-316. Additionally, WRA relies upon the opinion of Mr. William Alesker, the architect who designed the
World Trade Center project, who avers that he is unable to differentiate between the underlying zoning permits and
what the planning commission will approve because of the lack of objectivity. See Plaintiff’s Reply Brief in
Support of the Motion for Summary Judgment on Count 16 at 3, CMR D.N. Corp. and Marina Towers Ltd. v. City
of Phila., No. 07-1045 (E.D. Pa. filed Sept. 1, 2011).
11

Reply Brief in Support of Motion for Summary Judgment on Count 16, CMR D.N. Corp. and Marina Towers Ltd.
v. City of Philadelphia, No. 07-1045 (E.D. Pa. filed Sept. 1, 2011).
12

The City argues that “appropriateness” is effectively defined by the POD, which states: “‘Appropriateness’ is
determined by reference to the ‘surrounding community’ and the ‘goals articulated in the Civic Vision for the
Central Delaware.’” See Defendant’s Response in Opposition to Plaintiff’s Motion for Partial Summary Judgment
at 9, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D. Pa. filed Aug. 19, 2011) (citing
Philadelphia Code, § 14-1638(1)(h)).

11

“surrounding community,” which it fails to define using any objective criteria.13 (Doc.
#229 at 3).14
The City alleges that WRA has no vested property interest and, therefore, cannot
allege a substantive due process violation.15 Moreover, the City argues that even if WRA
could allege a substantive due process claim, it would fail on the merits because the
ordinance did not deprive WRA of all economically viable use of its property. See Hodel
v. Virginia Surface Mining & Reclamation Assn., Inc., 452 U.S. 264, 297 (1981). The
City argues that the Civic Vision16 read in conjunction with the zoning ordinance, the

13

Plaintiff also alleges that the CRO is a de facto moratorium on commercial development that is permitted by the
zoning plan. Third Amended Complaint at ¶ 358, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No.
07-1045 (E.D. Pa. filed April 5, 2011). However, the City states that it does allow development. See WRA’s
Counter-Statement of Facts at ¶¶ 318-19, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045
(E.D. Pa. filed Aug. 19, 2011); Memorandum in Support of the City of Philadelphia’s Motion for Summary
Judgment at 11, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D. Pa. filed July 27,
2011). A de facto moratorium forecloses all development in an overlay area. See Currier Builders, Inc. v. Town of
York, 2001 U.S. Dist. LEXIS 10268 (D. Me. July 20, 2001). Here, the City can point to a number of developers
who have succeeded in beginning development in the area. Additionally, WRA concedes that fact by stating that the
CRO “permits some degree of commercial development.” Plaintiff’s Memorandum in Opposition to Defendant’s
Motion for Summary Judgment at 9, CMR D.N. Corp. and Marina Towers Ltd. v. City of Philadelphia, No. 07-1045
(E.D. Pa. filed Aug. 19, 2011). Therefore, it cannot be deemed a de facto moratorium. See Currier Builders, Inc.
2001 U.S. Dist. LEXIS 10268.
14

Plaintiffs Memorandum of Law in Opposition to Defendant’s Motion for Summary Judgment, CMR D.N. Corp.
and Marina Towers Ltd. v. City of Philadelphia, No. 07-1045 (E.D. Pa. filed Aug. 19, 2011)
15

The City relies on Appeal of Dunlap, 87 A.2d 299, 301 (Pa. 1952), arguing Waterfront Renaissance does not have
a property interest because a property interest “vests upon securing a building permit and thereafter expending
substantial sums in reliance on such building permit.” Memorandum in Support of the City of Philadelphia’s
Motion for Summary Judgment at 8, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D.
Pa. filed July 27, 2011). The City essentially argues a person does not have a property interest, and, therefore,
cannot allege a substantive due process challenge to a zoning ordinance, until he or she secures a building permit.
This would preclude not only plaintiffs such as Waterfront Renaissance, who have not yet applied for a building
permit or variance, but also plaintiffs who applied for, but were denied, a building permit.
16

The Civic Vision was prepared by Penn Praxis, the consulting arm of the School of Design of the University of
Pennsylvania, as part of the Central Delaware Riverfront Planning Process. City of Philadelphia’s Motion for
Summary Judgment on Count 16 at ¶ 37, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045
(E.D. Pa. filed July 29, 2011). Although §14-1638(1)(h) of the Philadelphia Code indicates that the Planning
Commission “adopted” the Civic Vision, Planning Commission Chairman Alan Greenberger has stated publicly that
the Planning Commission did not “adopt” the Civic Vision (as an official planning document), but only “accepted”
the Civic Vision (as a working guideline for the development of a Master Plan). Id. at ¶ 38. The CRO is the interim

12

POD standards, and the legislative findings and definitions17 is not vague and that those
documents provide constitutionally valid guidance to property owners. 18 (Doc. #228 at
10).19 An approved POD is one that is consistent with the site’s underlying zoning and
its surrounding community within the CRO boundaries, and does not conflict with the
goals and purposes of the Civic Vision. (Doc. #228 at 35). Finally, the City argues that
“it is patently rational for the City to require developers to submit their plans to the

zoning overlay that the Civic Vision recommended. It was introduced on March 5, 2009 and was signed into law on
June 11, 2009, less than one month after the Planning Commission “accepted” the Civic Vision. Id. at ¶ 45.
The Civic Vision identifies certain goals for Movement Systems, Parks and Open Space, and Land Development,
such as increasing opportunities for public access to the riverfront, improving riverfront life and promoting water
quality and extending Philadelphia’s urban neighborhoods to the river’s edge. Id. at ¶ 43 (citing the Civic Vision,
pp. 72-74 (Exhibit K)). The Civic Vision also makes recommendations, such as ensuring public access to the
Riverfront through zoning, conservation easements and acquisition of public spaces, improving the quality of
development through the creation of both an interim zoning overlay and a long-term riverfront zoning classification,
and ensuring that short term gain does not preclude achieving long term goals. Id. at ¶ 44 (citing the Civic Vision,
pp. 30-31 (Exhibit K)).
17

For example, legislative finding 1(h) states:
This District is established to protect the existing characteristics of the built and natural
environment that are essential to achieving the working guidelines of the Civic Vision, adopted by
the Philadelphia City Planning Commission on April 21, 2009, while a Master Plan for the area is
developed. This section of the City presents a diverse collection of uses, ranging from the
working port and large retail establishments in the southern portion to high-rise residential
communities in the north. Special land use controls and design guidelines will help promote longterm economic viability and to provide for a framework for future growth.

Philadelphia Code, § 14-1638(1)(h).
18
Additionally, the City argues it is cannot simply make ad hoc determinations for approval. “In ascertaining and
giving effect to the intent of City Counsel, the Planning Commission will consider such factors as the “occasion and
necessity for the overlay, the circumstances under which it was enacted,” the issue to be remedied and the objectives
to be obtained by the overlay, the consequences of a particular interpretation, and the contemporaneous legislative
history. See Defendant’s Response in Opposition to Plaintiff’s Motion for Partial Summary Judgment at 14, CMR
D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D. Pa. filed Aug. 19, 2011) (citing 1 Pa.C.S. §
1901(c)).
19

Defendant’s Response in Opposition to Plaintiff’s Motion for Partial Summary Judgment, CMR D.N. Corp. and
Marina Towers Ltd. v. City of Philadelphia, No. 07-1045 (E.D. Pa. filed Aug. 19, 2011).

13

Planning Commission to ensure the integrity and consistency of the pending Plan.”20
(Doc. #223 at 8).
The City’s ordinance appears to be rationally related to the goal of the integrity
and consistency of appropriate development. WRA has failed to produce any evidence to
the contrary. Its only argument is that the structure of the CRO would allow for nothing
other than arbitrary and subjective approval because the ordinance does not define its
terms using objective criteria. There is simply no merit to the “impermissible discretion”
argument. It would be impossible for a zoning ordinance to identify specifically each and
every permitted use. A degree of discretion is necessary and is entirely consistent with
the long history of land use law in Pennsylvania. Such discretion does not render the
zoning ordinance unconstitutionally vague. 21
WRA had fair notice that the property was subject to a zoning ordinance. The
ordinance in question contains standards and uses which are appropriately delineated in
commonplace terms and categories. The POD also references specific legislative
findings that further clarify those standards. WRA has not alleged actions taken by the
City for reasons unrelated to land use planning, nor have they provided evidence of any
bad motives that suggest the City’s actions were unrelated to land use. Further, the CRO

20

The City cites Pace Resources, Inc. v. Shrewsbury Township, 808 F.2d 1023, 1034-1035 (3d Cir. 1987) (quoting
Rogin v. Bensalem Township, 616 F.2d 680, 689 (3d Cir. 1980) (stating “the federal courts largely defer to
legislative judgment on such matters as zoning regulation…unless the local legislative judgment is without a
plausible rational basis”)).
21

See Cnty Concrete, 442 F.3d at 167 (citing the Supreme Court's rule in Williamson as “respond[ing] to the high
degree of discretion characteristically possessed by land-use boards”); and Grayned v. City of Rockford, 408 U.S.
104 (1971) (holding that statute need only give fair warning of the types of conduct proscribed in light of common
understanding and practices).

14

does not place any restrictions on WRA as to the use of its property outside of its zoning
ordinance. (Doc. #223 at 10). While WRA’s use of the property is limited by the zoning
code, it certainly is not deprived of all economically viable use for its property.
i.

Delegation to Planning Commission
Generally, the Fourteenth Amendment protects individuals only against

government action, unless the state has delegated authority to a private party, thereby
making the actor a “state actor” and implicating the Due Process Clause. See Nat’l
Collegiate Athletic Ass’n v. Tarkanian, 488 U.S. 179, 195 (1988). The Due Process
Clause limits the manner and extent to which a state legislature may delegate legislative
authority to a private party acting as a state actor. See, e.g., Yick Wo v. Hopkins, 118
U.S. 356, 373-74 (1886); West v. Atkins, 487 U.S. 42, 56 (1988). Only if the state
legislature imposes sufficient limitations is the exercise of authority by the private party
constitutional. See, e.g., Seattle Title Trust Co. v. Roberge, 278 U.S. 116, 121-22 (1928)
(concluding that the delegation of zoning power to individual landowners violated the
due process clause because the ordinance allowed no opportunity for review and left the
private parties free to withhold consent for selfish or arbitrary reasons based on will or
caprice), but see Gilligan v. Pa. Horse Racing Comm’n, 422 A.2d 487, 489 (Pa. 1980)
(quoting Belovsky v. Redevelopment Authority, 54 A.2d 277, 284 (Pa. 1947) (stating the
legislative body “may establish primary standards and impose upon others the duty to
carry out the declared legislative policy in accordance with the general provisions of the
act.”).

15

Such delegated authority includes the ability to disseminate regulations so long as
“(1) the basic policy choices [are] made by the Legislature; and (2) the ‘legislation
[contains] adequate standards which will guide and restrain the exercise of the delegated
administrative functions.’” Gilligan, 422 A.2d 489 (quoting Chartiers Valley Joint
School Dist. v. Cnty Board of School Dirs., 211 A.2d 487, 493 (Pa. 1965)).
WRA argues that nothing in the City Charter authorizes the Planning Commission
to make zoning decisions. (Doc. #229 at 10). It argues that the CRO requires the
Planning Commission to “second-guess” the zoning established by the City Council
based on vague and undefined criteria. Id. at 12-13. The City argues the improper
delegation claim fails because the POD standard was set by City Council and the
ordinance at issue expresses only basic policy decisions and provides eight “Legislative
Findings” that address the specific objectives of the overlay. (Doc. #228 at 36). (Doc.
#223 at 15); Section 14-1638(1)(a)-(1)(h). Furthermore, the City argues that the
ordinance provides standards because the Plan must “provide[] for development
appropriate in scale, density, character and use for the surrounding community.” Id.;
Section 14-1638(12)(a).
WRA fails to supply evidence demonstrating that the Planning Commission was
delegated impermissible power or that the statute is void of ascertainable standards
against which a court may measure the Commission’s exercise of discretion. The
limitations on a legislative body’s ability to delegate do not mean that each and every
detail must be enumerated. See Hospital Ass’n of Pennsylvania v. MacLeod, 410 A.2d
731 (Pa. 1980). The ordinance sets forth eight findings that address the purpose of the
16

overlay area. The stated objectives and purpose of the overlay area, including
maintaining the City’s vision, encouraging a variety of uses, and driving economic
growth, are set forth in detail in the ordinance. See Philadelphia Code, § 14-1638(1)(a)(1)(h). Accordingly, there is no evidence that the Planning Commission is creating
zoning legislation.
2.

Equal Protection
The Equal Protection Clause of the Fourteenth Amendment provides that “[n]o

state . . . shall deny any person within its jurisdiction equal protection of the laws.” U.S.
Const. amend. XIV. “To bring a successful claim under 42 U.S.C. § 1983 for a denial of
equal protection, plaintiffs must prove the existence of purposeful discrimination. To the
extent Plaintiffs allege discrimination by Defendants solely by treating similarly situated
individuals more favorably, they must demonstrate that they ‘received different treatment
from that received by other individuals similarly situated.’” Keenan v. City of Phila., 983
F.2d 459, 465 (3d Cir. 1992) (citing Andrews v. City of Phila., 895 F.2d 1469, 1478 (3d
Cir. 1990)); and Cnty Concrete, 442 F.3d at 167 (stating the test for a facial equal
protection challenge to land-use regulations is the arbitrary differential treatment of
similarly situated property owners).
Thus, the “first inquiry a court must make in an equal protection challenge to a
zoning ordinance is to examine whether the complaining party is similarly situated” to
other uses that are permitted. Congregation Kol Ami v. Abington Twp., 309 F.3d 120,
137 (3d Cir. 2002). If the entities are similarly situated, then the City must justify its
different treatment of the two under the rational basis test. Rogin v. Bensalem Twp., 616
17

F.2d 680, 6898 (3d Cir. 1980). Under rational basis, the burden is on the party
challenging the validity of the ordinance to establish that the statute is unconstitutional.
FCC v. Beach Communs, Inc., 508 U.S. 307, 314-15 (1993). The party defending the
constitutionality of the action need only demonstrate some legitimate justification that
motivated the action. Id. at 315.22
WRA alleges that the CRO and POD regulations violate equal protection because
the standards are impermissibly vague and indefinite and invite ad hoc regulation and
impermissible discrimination.23 WRA claims that the City sought to deprive them of the
use of their property, by arbitrarily and selectively extending the Overlay to target their
development, but not other similarly situated properties.24 (Doc #211 at ¶ 15).
There is simply no evidence that Defendants targeted WRA for disparate
enforcement of the ordinance. Additionally, WRA has not met the burden to establish
there is no rational basis for the City’s actions. The City contends that the ordinance “is
established to protect the existing characteristics of the built and natural environment that
are essential to achieving the working guidelines of the Civic Vision, adopted by the
Philadelphia City Planning Commission on April 21, 2009, while a Master Plan for the

22

The Third Circuit has articulated that the arbitrary and irrational standard is “doubtless difficult for a plaintiff to
meet in a zoning dispute.” Eichenlaub v. Twp. of Indiana, 385 F.3d 274, 287 (3d Cir. 2004). The Court concluded
that “[i]t may be very unlikely that a claim that fails the substantive due process test will survive under an equal
protection approach.” Id.
23

WRA cites to Horton v. California, 496 U.S. 128 (1990), to discuss the vagueness of the statute; however, Horton
addressed the fourteenth amendment in the criminal procedure context rather than an equal protection claim for
vagueness. See Supra note 8 (discussing vagueness in the zoning context).
24

The Overlay extension omits the eastern half of the KOZ, which is owned by the City and is currently leased to
the Riverwalk group for casino development. In addition, the Overlay extension omits two (2) similarly situated
sites to the south of WRA’s Site which are much closer to Old City (one of which is also owned by the City).

18

area is developed.” Additionally, the City articulated that “The purpose of the Central
Delaware Riverfront Overlay is to provide development guidance and controls during the
period in which a public policy master plan is prepared for the Central Delaware
Riverfront.”25 These reasons are certainly rationally related to a legitimate state interest.
B.

Promissory Estoppel and Detrimental Reliance
“The doctrine of promissory estoppel allows a party, under certain circumstances,

to enforce a promise even though that promise is not supported by consideration.”
Shoemaker v. Commonwealth Bank, 700 A.2d 1003, 1006 (Pa. Super. Ct. 1997). In
Pennsylvania, the doctrine of promissory estoppel involves three elements: (1) the
promisor made a promise that he should have reasonably expected to induce action or
forbearance on the part of the promisee; (2) the promisee actually took action or refrained
from taking action in reliance on the promise; and (3) injustice can be avoided only by
enforcing the promise. Jodek Charitable Trust, R.A. v. Vertical Net Inc., 412 F. Supp. 2d
469, 478 (E.D. Pa. 2006).
Under Pennsylvania law, plaintiff need not allege the exact, express “promise” in
order to state a cause of action for promissory estoppel. See, e.g., Cornell Cos, Inc. v.
Borough of New Morgan, 512 F. Supp. 2d 238, 266 (E.D. Pa. 2007); Straup v. Times
Herald, 283 Pa. Super. 58, 423 A.2d 713, 720 (Pa. Super. 1980) (describing promissory
estoppel as “a flexible doctrine, to be applied . . . as the equities between the parties
preponderate”). However, a broad and vague implied promise is not enough to satisfy the
first element. Ankerstjerne v. Schlumberger Ltd., 2004 U.S. Dist. LEXIS 9927, *14
25

POD Regulations, Section 1. Preamble. (Exh. R.).

19

(E.D. Pa. 2004) (citing C & K Petroleum Prods., Inc. v. Equibank, 839 F.2d 188, 192 (3d
Cir. 1988)).
WRA claims that over a period of almost 20 years, the City encouraged and
materially supported WRA’s Project, by brokering the Zoning Covenant,26 re-zoning the
Site to C-4 without height restrictions, applying to the Commonwealth alongside WRA to
include the Site in a KOZ, and promoting a public/private partnership between WRA and
DRPA.27 (Doc #229 at 17-20). WRA further alleges that it incurred substantial expenses
in reliance on the City's representations, including designing, engineering, and promoting
the project and transferring its exclusive World Trade Center license. Id. at 19. These
actions were well known to and often in conjunction with the City, in an effort to advance
development of the Site.
The City contends that its “mere encouragement” is not sufficient to support a
promissory estoppel claim.28 It alleges there are no genuine issues of material fact that
the City “clearly expressed an intention to be bound” by its actions. (Doc. # 223 at 21).
The City also notes that WRA’s reliance on the City’s support was not justified because
26

Under the Zoning Covenant, WRA agreed to design certain elements of the Project to satisfy a number of
concerns raised by the Civic Associations, such as parking for the Project, view corridors so as to not block the
Delaware River, the appearance of the Project and other similar issues. As part of the Zoning Covenant, the Civic
Associations agreed to support and assist the permitting for the Project. Specifically, the Zoning Covenant provides
as follows: [The] Civic Associations also agrees to support and assist the Covenanter [WRA] in obtaining any and
all permits and variances that may be necessary to use and/or develop said premises in accordance with the below
listed restrictions and conditions. (Doc. #211 at ¶¶ 61-68) Zoning Covenant (Exh. H.).
27

The City argues that none of these actions can be considered actions or promises sufficient to sustain a promissory
estoppel action because they were not specific or made by those with actual authority.
28

The City argues that the City can act only through its officers and agents and that WRA fails to identify any City
official who made the alleged promises to support the World Trade Center project. Defendant’s Motion for
Summary Judgment at 18, CMR D.N. Corp. and Marina Towers Ltd. v. City of Phila., No. 07-1045 (E.D. Pa. filed
July 29, 2011). The City thus contends that WRA failed to meet its evidentiary burden for a promissory estoppel
claim by offering specific “promises” by a City official. Id. at 20.

20

WRA had notice of required procedures for development approval and WRA made no
effort to inquire. Id. at 23-24.
The Plaintiff has been unable to articulate a valid and enforceable promise.29 I
find there is insufficient evidence in the record of a promise to support a promissory
estoppel claim. WRA insists that it never alleged the actionable promise was to enforce
C-4 zoning in perpetuity, as the City argues. Certainly the City could not promise, and
WRA could not expect a promise, to maintain a specific zoning classification “in
perpetuity.” WRA characterizes the City’s “promise” as a broad, amorphous
commitment to “not enact an unconstitutional law.” We can assume the converse of that
also to be true: that the City will consider itself obligated to pass only constitutional
laws. For the plaintiff to suggest the City would intentionally pass a law that it knows
will be held unconstitutional is unrealistic. As the plaintiff well knows, the
constitutionality of a law is for the courts and it is sometimes difficult for a legislative
body, say for example the Philadelphia City Council, to always predict whether a
particular ordinance will pass constitutional muster. A promise to always pass
constitutional laws is at worst unreliable and at best unreasonable and unenforceable. No
such promise could be made and no such promise was made in this case. I find that the
CRO and POD regulations in this case are, in fact, constitutional and thus the City did not
“break a promise” by enacting unconstitutional laws. The City’s “promise” to support
29

At oral argument, the parties articulated each of their versions of the alleged “promise” made by the City. The
City characterizes the alleged promise as “C-4 zoning in perpetuity” and that this promise is outside the City’s
authority to make. (Doc. #239 at 4-5 ¶ 20-22). The City then referenced WRA’s response to the City’s Motion for
Summary Judgment and explained that in that document, the alleged promise was “not to destroy a long-term
project by arbitrary and unconstitutional ordinances.” Id. at 6, ¶¶ 20-22. WRA claimed that the promise was that
the City agreed to “support the project.” Id. at 25, ¶¶ 8-9. WRA added that this support only required the City to act
in good faith. Id. at 37, ¶¶ 3-4.

21

WRA’s site development, cannot constitute a promise that a court is capable of enforcing.
Therefore, I will grant the City’s Motion for Summary Judgment as to Counts III and IV
of Plaintiffs’ Complaint.
C.

Unjust Enrichment
Under Pennsylvania law, a claim of unjust enrichment must allege the following

elements: (1) plaintiff conferred a benefit on the defendant; (2) the defendant appreciated
the benefit; and (3) acceptance and retention by the defendant of the benefits, under the
circumstances, would make it inequitable for the defendant to retain the benefit without
paying for the value of the benefit. Com. ex. rel. Pappert v. TAP Pharm. Prods., Inc., 885
A.2d 1127 (Pa. Commw. 2005). See also Torchia v. Torchia, 499 A.2d 581, 582 (Pa.
Super. 1985) (“[T]o sustain a claim of unjust enrichment, a claimant must show that the
party against whom recovery is sought either wrongfully secured or passively received a
benefit that it would be unconscionable for her to retain.”). However, Pittsburgh Baseball
v. Stadium Auth., 630 A.2d 505, 510 (Pa. Commw. Ct. 1993) narrows the application of
an unjust enrichment claim, holding that a party who bestows an indirect benefit on
another is not entitled to a quasi-contract remedy.30
WRA alleges that the City combined eleven and a half (11.5) acres of City-owned
property with WRA’s Site to establish the minimum fifteen (15) acres required for a
KOZ, a status which the City would not otherwise have obtained. (Doc. #211 at ¶¶ 6978). WRA alleges that it bore the expense of hiring a lobbyist, Steven Wojcik and
30

The court found that Pittsburgh Associates’ argument relied on a false premise when it claimed that it conferred
enormous benefits on the City because the Pirates’ fans, and not Pittsburgh Associates, paid the taxes on ticket sales
and made the other expenditures. Pittsburgh Baseball, 630 A.2d 505 (Pa. Commw. Ct. 1993).

22

Associates, without whom the KOZ status would not have been granted. (Doc. #239 at
34 ¶¶ 17-25). Specifically, WRA alleged that it paid the Wojcik firm “approximately
one-hundred and fifty thousand dollars to achieve this result[,]” and the City benefitted
from WRA’s efforts, which resulted in the KOZ status. Id. at 34-35 ¶¶ 24-25, 1-5. There
is an element of cynicism inherent in this argument. For sure, WRA hired the lobbyist
and the lobbyist likely assisted the effort by advocating for the parties’ joint request for
KOZ status. But to say the hiring of the lobbyist secured the result totally diminishes the
parties’ integrity in the application process. The “my lobbyist created your result”
position completely dismisses the Commonwealth of Pennsylvania’s independent review
of the application and the ultimate granting of the KOZ designation through the analysis
of objective criteria, precedent and standards. Plaintiff’s pompous pronouncement that it
conferred a benefit on the City by obtaining the KOZ status ignores the City’s
cooperative effort, the Commonwealth’s exercise of discretion, and the fact that WRA’s
portion of the property, which is substantial, is more valuable today than it was before it
was designated for the KOZ.
The City is correct that the KOZ status was an indirect benefit bestowed upon the
City by the Commonwealth and was not due to entirely to WRA’s actions. (Doc. #223 at
29). Even if the City did receive a benefit from WRA, it would not be unjust because
WRA also received a benefit from the transaction. Id. at 28. WRA has failed to produce
evidence that it conferred a direct benefit upon the City. Much like the Pittsburgh
Baseball case, WRA did not bestow the benefit of KOZ status on the City. The status
was granted by the Commonwealth of Pennsylvania and, therefore, WRA makes no
23

showing that it is entitled to a quasi-contract remedy where it conveyed no benefit upon
the City.
V.

CONCLUSION
For the reasons set forth in this memorandum, I will grant the City of

Philadelphia’s motion for summary judgment, any deny the plaintiff’s motion.

An appropriate order follows.

24