The opinion
RECOMMENDED FOR PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 21a0132p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
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BENTON BENALCAZAR; KATHERINE BENALCAZAR,
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Plaintiffs-Appellees/Cross-Appellants, │
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v. > Nos. 20-3995/4044
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GENOA TOWNSHIP, OHIO, │
Defendant-Appellee (No. 20-3995), │
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GTRRD, INC.; LUKE SCHROEDER; JANINE SCHROEDER, │
Intervenors-Appellants/Cross-Appellees. │
┘
Appeal from the United States District Court
for the Southern District of Ohio at Columbus.
No. 2:18-cv-01805—Algenon L. Marbley, District Judge.
Argued: June 2, 2021
Decided and Filed: June 10, 2021
Before: SUTTON, Chief Judge; DAUGHTREY and GRIFFIN, Circuit Judges.
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COUNSEL
ARGUED: Peggy S. Guzzo, GUZZO LAW OFFICE, Dublin, Ohio, for GTRRD, Inc., and
Luke and Janine Schroeder. Joseph R. Miller, VORYS, SATER, SEYMOUR AND PEASE
LLP, Columbus, Ohio, for Benton and Katherine Benalcazar. David A. Riepenhoff, FISHEL
DOWNEY ALBRECHT & RIEPENHOFF LLP, New Albany, Ohio, for Genoa Township, Ohio.
ON BRIEF: Peggy S. Guzzo, GUZZO LAW OFFICE, Dublin, Ohio, for GTRRD, Inc., and
Luke and Janine Schroeder. Joseph R. Miller, Christopher L. Ingram, Elizabeth S. Alexander,
VORYS, SATER, SEYMOUR AND PEASE LLP, Columbus, Ohio, for Benton and Katherine
Benalcazar. David A. Riepenhoff, Stephanie L. Schoolcraft, FISHEL DOWNEY ALBRECHT
& RIEPENHOFF LLP, New Albany, Ohio, for Genoa Township, Ohio.
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 2
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OPINION
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SUTTON, Chief Judge. Nestled next to the Hoover Reservoir in central Ohio, Genoa
Township boasts scenic views just a short drive north of Columbus. Like many communities,
the Township has struggled to balance demands for growth against preferences for more
greenspace. Two decades ago, Benton and Katherine Benalcazar bought 43 acres in
the Township, which was zoned mainly for rural use and which indeed had many rural
qualities—plenty of trees, few houses, plenty of undeveloped land. A few years ago, they had a
change of heart, preferring to use the property for a development rather than to preserve its
bucolic nature. The Benalcazars applied to rezone their property to enable the development of a
housing complex not far from the west side of the reservoir, and the Township’s board of
trustees approved the request.
The approval upset several Township residents. As permitted by state law, they passed a
referendum that prevented the rezoning.
The Benalcazars sued, claiming the Township violated their rights under the Due Process
and Equal Protection Clauses of the U.S. Constitution. The Township settled the matter, signing
a consent decree that permitted the Benalcazars to develop their property, though with fewer
houses than they had first proposed. Frustrated by this perceived end run around the referendum
process, a group of residents intervened and moved to dismiss the Benalcazars’ lawsuit and
scuttle the settlement. The district court approved the consent decree, and so do we.
I.
The Benalcazars purchased property in the Township in 2001. Their 43-acre plot sits at
the northern end of the Township’s more developed areas and abuts the Hoover Reservoir,
located just east of their property. At the time the Benalcazars purchased their land, the
Township zoned the parcel as Rural Residential. That zoning designation created several
impediments to a housing development. The Benalcazars would have to build separate septic
systems, clear-cut the area, and install multiple driveways along a main road to develop the land
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 3
as zoned. To avoid those hurdles, the Benalcazars applied in 2017 to rezone the property to a
different state law status, called a Planned Residential District, which permits higher density
development. The Township’s trustees met in April 2018, and approved the Benalcazars’
rezoning application by a 2-1 vote.
A week after the vote, the dissenter, Frank Dantonio, emailed members of the community
about the development plan. He explained why he opposed the proposal and told them how to
override the decision. Ohio law permits residents to pass a referendum that prevents a zoning
amendment from taking effect, see O.R.C. § 519.12(H), and Dantonio urged residents to invoke
this tool of direct democracy.
Genoa Township residents approved the referendum and reversed the zoning decision.
Over 75% of voters supported the referendum and opposed the development.
The Benalcazars were not pleased. Invoking the Due Process and Equal Protection
Clauses of the U.S. Constitution, they sued the Township, claiming it deprived them of their
property rights and unfairly singled them out for differential treatment. They claimed that the
Township has “approved nearly one hundred rezonings from Rural Residential to Planned
Residential District,” including ones with higher net densities than their proposed development.
R.1 at 5. They also alleged that the referendum’s supporters resorted to unsavory tactics, calling
the Benalcazars outsiders even though the family had “lived on the Property for seventeen years”
and questioning “where they are from, and whether they are trustworthy.” Id. at 2, 14. The
Benalcazars sought declaratory relief, a permanent injunction, and damages.
The Township and the Benalcazars worked out a compromise. On one side of the
bargain, the Township agreed to change the zoning designation for the Benalcazars’ 43-acre plot
from Rural Residential to Planned Residential District. On the other side, the Benalcazars agreed
to reduce the proposed development from 64 homes to 56 homes, to provide for more open
space, to increase the width of half of the lots, and to drop their lawsuit. After a public hearing
in which the trustees considered the settlement, the Township and the Benalcazars filed a joint
motion for approval of the agreement with the court. In doing so, they pointed to an Ohio law
that allows such consent decrees. “Notwithstanding . . . any vote of the electors on a petition for
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 4
zoning referendum,” it says, “a township may settle any court action by a consent decree or
court-approved settlement agreement which may include an agreement to rezone any property
involved in the action.” O.R.C. § 505.07.
Several of the Township’s residents remained unhappy with the development plan, even
as modified. They formed an “association of neighboring Genoa Township residents,” which
sought to intervene in the lawsuit to oppose the consent decree. R.22 at 1. Luke and Janine
Schroeder, individual members of the association, sought to intervene too, alleging that the
Benalcazars’ “development would have a negative impact on the enjoyment of,” and would
“devalue” their property. R.24-3 at 2; R.24-4 at 2. The district court permitted them to intervene
under Civil Rule 24(a).
The intervenors moved to dismiss the complaint under Civil Rule 12(b)(6). Because “all
property owners seeking zoning amendments face the possibility of a referendum vote,” they
claimed, the Benalcazars did not suffer any unfair or unequal treatment. R.52 at 3. The district
court dismissed the due process and declaratory judgment claims. But it ruled that the
Benalcazars stated a plausible equal protection claim under Civil Rule 12(b)(6). It then approved
the consent decree.
II.
A.
The key question on appeal, as framed by the parties, is whether the predicate for this
consent decree—a valid federal court dispute—exists. As the parties have litigated this case,
they have assumed that a court may not oversee a settlement unless it first establishes that the
underlying complaint survives a motion to dismiss under Civil Rule 12(b)(6).
But that is not true. Subject-matter jurisdiction over a dispute is one thing; the merits of
the underlying dispute are another. Rarely do the twain meet. What matters here is a threshold
question, one distinct from the plausibility inquiry of Civil Rule 12(b)(6): Namely, do the
federal questions raised by this complaint legitimately create federal court jurisdiction because
they are not so frivolous as to be a contrived effort to create such jurisdiction? See Steel Co. v.
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 5
Citizens for a Better Env’t, 523 U.S. 83, 89 (1998). As the Court put the point in Steel Co., case
law “firmly establishe[s] . . . that the absence of a valid (as opposed to arguable) cause of action
does not implicate subject-matter jurisdiction, i.e., the courts’ statutory or constitutional power to
adjudicate the case.” Id. As the Court put the point decades earlier in Bell v. Hood,
“[j]urisdiction . . . is not defeated . . . by the possibility that the averments might fail to state a
cause of action on which petitioners could actually recover”; only where the “claim is wholly
insubstantial and frivolous” is jurisdiction lacking. 327 U.S. 678, 682–83, 685 (1946).
None of this changes in the context of a consent decree. The law requires only that the
“consent decree must spring from and serve to resolve a dispute within the court’s subject-matter
jurisdiction. Furthermore, consistent with this requirement, the consent decree must ‘com[e]
within the general scope of the case made by the pleadings,’ and must further the objectives of
the law upon which the complaint was based.” Local No. 93, Int’l Ass’n of Firefighters v. City of
Cleveland, 478 U.S. 501, 525 (1986) (quoting Pacific R. Co. v. Ketchum, 101 U.S. 289, 297
(1880)).
So long as the Benalcazars’ due process and equal protection claims are not “frivolous”
but “arguable,” the district court had subject-matter jurisdiction over them. With that
jurisdiction, the district court had authority to approve a settlement. No other merits inquiry was
required. Parties do not have to litigate the merits of a case, whether under Civil Rule 12(b)(6)
or Civil Rule 56, to settle it.
How strange if that were not the rule—if a district court could never settle a dispute until
after resolving a motion to dismiss or for that matter a motion for summary judgment or, as here,
an appealed motion to dismiss. Parties settle disputes for a variety of reasons, sometimes to save
money, sometimes to resolve the disagreement more quickly, sometimes to remove doubt about
the validity of conduct, always to allow the affected individuals to move on. All of these
explanations for settlement would be undermined if we imposed a Civil Rule 12(b)(6), or for that
matter a Civil Rule 56, hurdle to approving settlements.
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 6
To be fair to the parties, they may have perceived resolution of the motion to dismiss as a
useful predicate for establishing that the court should, or should not, approve the settlement.
That is a fair point, if not an indispensable one.
Measured by this modest test—that the Benalcazars raise sufficiently “arguable” and not
“frivolous” claims to create federal court jurisdiction—this complaint passes. Whether it is the
equal protection challenge to the Township’s zoning decision or the due process challenge to its
limitation on their property rights, we cannot say that the legal theory of the case was beyond the
pale under the allegations raised in the complaint. In support of both claims, the complaint
alleges that the Township has approved “nearly one hundred rezonings from Rural Residential to
Planned Residential District.” R.1 at 5. It includes a map showing that a sizeable chunk of
Genoa Township counts as a Planned Residential District. It identifies three allegedly similar
properties that the Township rezoned from Rural Residential to Planned Residential District, two
of which received approval at greater development densities than the Benalcazars’ original
proposed plan. On top of that, the complaint points to statements painting the Benalcazars as
part-time residents and outsiders. It also alleges that the referendum’s supporters “called the
Benalcazars’ residency into question” without reason and emphasized that their “children did not
attend the area schools.” Id. at 14–15. Taken as true, these allegations do not amount to a
frivolous charge that Genoa Township violated the Benalcazars’ equal protection and due
process rights by singling them out for unfair treatment.
That zoning changes like this one are potentially subject to a special referendum process
does not transform the complaint into a frivolous charge. All statutes in Ohio are subject to
referendum. Ohio Const. art. II, §§ 1, 1b; State ex rel. Ohio Gen. Assembly v. Brunner,
873 N.E.2d 1232, 1234 (Ohio 2007). So too of all Ohio constitutional provisions, which are
subject to the referendum’s direct democracy cousin, the initiative. Ohio Const. art. II, §§ 1, 1a.
In this context, the existence of a zoning referendum procedure by itself does not cut in one
direction or the other. The key point is that people may not directly (through a referendum or
initiative) or indirectly (through representatives) accomplish otherwise impermissible ends. See
City of Cleburne v. Cleburne Living Ctr., 473 U.S. 432, 448 (1985). A “referendum . . . is the
city itself legislating through its voters,” City of Eastlake v. Forest City Enterprises, Inc.,
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 7
426 U.S. 668, 678 (1976) (quotation omitted), just as an initiative amounts to the State itself
amending the constitution through its voters. Whether by popular referendum or trustee vote,
Genoa Township acted on the Benalcazars’ application and the other rezoning applications too,
potentially making them responsible for any federal constitutional violations. Id.
Even so, the intervenors suggest, the Benalcazars have failed to identify similarly situated
property owners whom the Township treated differently. The intervenors emphasize that most of
the comparator properties identified in the complaint sit in a different planning area of the
Township. But, as they concede, the Benalcazars did identify at least one other property that the
Township rezoned in their same planning district. More to the point, the intervenors are barking
up the wrong tree. These arguments all go to the plausibility of the complaint. They do not
show that the complaint is frivolous.
Our unpublished decision in Kenney v. Blackwell does not point in a different direction.
225 F.3d 659 (6th Cir. 2000) (table). A different Genoa Township property owner sought to
rezone his property from Rural Residential to Planned Residential District. Id. at *1. After
securing approval from the trustees, the Township voted to halt the rezoning. Id. We affirmed
the district court’s decision to grant summary judgment to the Township on the property owner’s
equal protection claim because, as we pointed out, the district court identified “several logical
reasons” for the rezoning decision. Id. at *3. But Kenney resolved a merits inquiry under Civil
Rule 56, not a motion to dismiss for lack of jurisdiction due to the frivolousness of the claims.
Kenney involved different evidence for different comparators at a different stage of litigation.
B.
Independent of their argument that the district court should have granted their motion to
dismiss, the intervenors insist that the consent decree did not merit approval either way. While
there is some uncertainty about the scope of the district court’s order granting the intervenors’
motion to intervene, that order clearly permitted a challenge to the consent decree (via the
motion to dismiss argument) and thus fairly includes other related challenges to the consent
decree.
Nos. 20-3995/4044 Benalcazar, et al. v. Genoa Twp. Ohio, et al. Page 8
As shown, the district court had subject-matter jurisdiction over this dispute. These were
not frivolous claims beyond the power of the federal courts to hear. And the Benalcazars plainly
had standing to protect their property interests and to ensure equal treatment between them and
other residents. Lujan v. Def’s of Wildlife, 504 U.S. 555, 560–61 (1992).
The court also legitimately approved the settlement. Each side took something from the
resolution of this local zoning dispute. The Township managed to limit the scope of the
development from 64 houses to 56 houses and, to preserve more greenspace than the original
proposal contemplated. Those features of the bargain honored the perspective of the trustee who
initially disapproved the proposal and the voters who rejected it through the referendum. At the
same time, the settlement permitted the Benalcazars to use their property largely as they
wished—for a scaled-down development.
In view of this disposition of the case, the Benalcazars’ cross-appeal—challenging the
district court’s rulings on the due process claim and the intervention motion—is moot.
Through it all, we appreciate the intervenors’ frustration that their successful referendum
was minimized by this lawsuit and the resulting settlement—and that their right to vote in the
referendum seemingly came to naught. That the consent decree did not mimic the development
plan rejected by the referendum, in truth made significant changes to it, is a partial answer. After
that, the intervenors must come to grips with another democratically enacted law—an Ohio
statute that, for reasons of its own, allows the Benalcazars and Township to do just what they
did. Recall the statutory language that qualifies the referendum right with authority to obtain a
consent decree or settlement that pulls back on the result of any zoning referendum.
“Notwithstanding . . . any vote of the electors on a petition for zoning referendum,” it
establishes, “a township may settle any court action by a consent decree or court-approved
settlement agreement which may include an agreement to rezone any property involved in the
action.” O.R.C. § 505.07. In this setting, any lingering frustration of the residents of Genoa
Township requires them either to change this state law or to exercise their franchise to defeat the
trustees who approved the initial zoning proposal and who approved this settlement.
We affirm.