Opposition Brief — Old Vail Partners v. County of Riverside

Supreme Cour

ed

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No. 97-135 SEP 19 1997

Supreme Court Of The United States

OCTOBER TERM 1996

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OLD VAIL PARTNERS,

Petitioner,

V.

COUNTY OF RIVERSIDE;

CITY OF TEMECULA,

Respondents.

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On Petition for a Writ of Certiorari to the

United States Court of Appeals For The Ninth Circuit

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BRIEF OF RESPONDENT COUNTY OF RIVERSIDE IN

OPPOSITION TO PETITION FOR WRIT OF CERTIORARI

4

W. DOUGLAS KARI

Counsel of Record

ORRICK, HERRINGTON & SUTCLIFFE LLP

777 South a Street

Los Angeles, Califormia 90017

Telephone: (213) 629-2020

WILLIAM C. KATZENSTEIN, County Counsel

TIMOTHY J. DAVIS, Deputy County Counsel

COUNTY OF RIVERSIDE

3535 10th Street, Third Floor

Riverside, California 92501

(909) 275-6300

Attorneys for Respondent

County of Riverside

LANTAGNE LEGAL PRINTING

801 East Mam Street Suite 100 Richmond. Virginia 23219 (800) 847-0477 i

RESTATEMENT OF QUESTION PRESENTED

Whether the Court of Appeals erred in

ordering abstention under Younger v. Harris, 401 U.S. 37,

91 S. Ct. 746, 27 L. Ed. 2d 669 (1971), rather than under

Railroad Comm’n of Texas v. Pullman, 312 U.S. 496, 61 S.

Ct. 643, 85 L. Ed. 971 (1941), where petitioner is litigating

its federal claim in a pending state court proceeding, and the

proceeding implicates important state interests.

TABLE OF CONTENTS

Page

Restatement of Question Presented ................_.. i

Table of Authorities ............................. iii

Dee 4 0.08 se............. l

Statement of TheCase ........................... 2

Reasons Why a Writ Should Be Denied ..........___. 6

I. The Court of Appeals Correctly

Ordered Younger Abstention Because

The Case Implicates Important State

Interests And Old Vail Has An Adequate

Opportunity To Litigate Its Constitutional

Claim In StateCourt ................. 6

Il. Pullman Abstention Would Not Be

Proper Because There Is No Unsettled

Issue Of StateLaw ...............__.. 9

III. Pullman Abstention Would Not Be

Proper Because Old Vail Has Voluntarily

Litigated Its Takings Claim In State

en rn ae 1]

ee 12

TABLE OF AUTHORITIES

Cases Page

City of Houston v. Hill, 482 U.S. 451, 467-68,

107 S. Ct. 2502, 2512-13, 96 L. Ed. 2d 398 (1987) .... 1]

England v. Louisiana State Bd. Of Medical

Examiners, 375 U.S. 411, 419, 84 S. Ct. 461, 467.

11 L. Ed. 2d 440 (1964) 2.0... 1]

Hawaii Housing Auth. v. Midkiff, 467 U.S. 229, 230,

104 S. Ct. 2321, 2324, 81 L. Ed. 2d 186 (1984) ...... 1]

Middlesex County Ethics Comm. v. Graden State Bar

Ass’n, 457 U.S. 423, 432, 102 S. Ct. 2515, 2521,

73 ©. BG. 24 VIG (19BZ) .. 2 kee. 7

Ohio Bureau of Employment Services y. Hodory,

431 U.S. 471, 477, 97 S. Ct. 1898, 1902-03,

ee RET se) 6

Railroad Comm’n of Texas v. Pullman,

312 U.S. 496, 61 S.Ct. 643,

85 L.Ed. 971(1941) .............. i, 1, 6,9, 10, 11, 12

Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746,

27 L. Ed. 2d 669(1971) ........... i, 1, 2, 5, 6, 7, 8, 12

Statutes

OMS ood RST a, 4

iil

Ore ies en ........:.....

evusc umes ..............

Other Authorities

Fifth Amendment to the United States Constitution |...

a SO Be |)

ee

Municipal Improvement Act of 1913, California Streets &

Highways Code §§ 10000 ef seg. .................

INTRODUCTION

The petition for writ of certiorari filed by Old

Vail Partners (“Old Vail”) misconstrues the abstention

doctrines and how they apply to this case.

As set forth below, Younger dainsion is

proper where a pending state proceeding implicates important

state interests, and the proceeding affords the litigant an

adequate opportunity to raise the federal constitutional issue.

Those factors are present here -- a point that Old Vail appears

to concede. Accordingly, Old Vail has failed to show that the

Ninth Circuit Court of Appeals erred in ordering Younger

abstention.

Pullman abstention only arises where an

unsettled question of state law may render adjudication of the

constitutional issue unnecessary. For example, if a state

statute arguably would be uncofstitutional if interpreted one

way, but constitutional if interpreted another way, Pullman

abstention may be ordered until the statute is construed in a

state proceeding. Here, Old Vail has not pointed to any

unsettled issue of state law that would bring Pullman into

play.

As a result, Old Vail’s contention that the

Ninth Circuit has muddled the abstention doctrines and is

applying them disparately to similarly-situated litigants has no

merit. The unpublished memorandum decision ordering

Younger abstention simply means that Old Vail will continue

to pursue its constitutional claim in state court -- a forum it

voluntarily chose -- and will not be given a “second bite at the

apple” in district court.

For these reasons, respondent County of

Riverside (the “County”) respectfully submits that Old Vail’s

petition should be denied.

STATEMENT OF THE CASE

Old Vail formerly owned a parcel of real

property (the “Property”) within the County. Before Old Vail

bought the Property, the County created Assessment District No.

159 (“AD No. 159”) under the Municipal Improvement Act of

1913, California Streets & Highways Code §§ 10000 ef seq. (the

“1913 Act”). The Property falls within the boundanes of AD

No. 159.

The 1913 Act empowers local governmental

entities in California to form assessment districts to finance public

improvements within the boundaries of such districts. A lien is

placed on each property within the assessment district to secure

payment for the improvements financed. Initially the lien may be

paid in cash and fully satisfied, although as a practical mat. “w

property owners choose to do so. Rather, bonds are issued to

finance the amount needed to pay for the improvements. The

lien amount against each property is collected over time through

assessment installments. Proceeds from the assessment

installments are used to pay debt service on the bonds.

Under the 1913 Act, before an assessment can be

levied, the assessment engineer must calculate the direct and

special benefit to each property within the assessment district.

This enables the assessment engineer to divide the cost of the

improvements financed in proper proportion among the various

properties. Old Vail alleges that in AD No. 159 the County

assessed the Property based on contemplated commercial zoning.

In other words, Old Vail alleges that its proportionate share of

the assessment was based on the Property ultimately being put to

commercial use.

On December 1, 1989, respondent City of

Temecula (the “City”) annexed the land located within AD No.

159, including the Property. On November 9, 1993, the City

adopted its general plan, which shows the Property to be in an

area of “professional office” designation. Old Vail alleges that by

designating the Property as “professional office,” the City down-

zoned the Property from the “commercial!” zoning that the

County had contemplated. Old Vail alleges that this rendered its

assessment lien excessive by some $600,000.

On August 3, 1994, Old Vail filed a complaint

against the County and the City in the United States District

Court, Central District of California. That same day Old Vail

also filed a complaint in California state court. Both complaints

alleged, among others, a takings claim under the Fifth

Amendment of the United States Constitution and 42 U.S.C. §§

1983 and 1985.

The County filed a motion to dismiss Old Vail’s

district court complaint under Fed. R. Civ. P. 12(6)(1) and

12(b)(6), arguing that the district court lacked subject matter

jurisdiction under the Tax Injunction Act of 1937, 28 U.S.C. §

1341, or alternatively that Old Vail had failed to state a claim

upon which relief can be granted. The City joined in this motion.

The district court issued a written decision granting the motion

and dismissing the action without prejudice to Old Vail going

forward in state court. The district court subsequently denied a

motion by Old Vail for reconsideration. Old Vail timely filed a

notice of appeal.

Meanwhile, Old Vail continued to pursue its state

court action, including the takings claim. After numerous

hearings and extensive briefing addressed to the merits of Old

Vail’s takings claim and its state law theories of relief, the state

court entered a final judgment dismissing the action on the

grounds that Old Vail failed to allege facts sufficient to constitute

a cause of action -- the California equivalent of dismissal under

Fed. R. Civ. P. 12(b)(6). Old Vail filed a notice of appeal. The

appeal has been fully bnefed and is awaiting oral argument before

the California Court of Appeal.

On February 3, 1997, Old Vail’s appeal of the

district court decision came on for oral argument before the

Ninth Circuit Court of Appeals. On February 10, 1997, the

Court of Appeals issued a memorandum decision vacating the

district court’s decision and remanding the case for dismissal

under Younger. Thereafter Old Vail filed the pending petition

for writ of certiorari.

REASONS WHY A WRIT SHOULD BE DENIED

I. The Court Of Appeals Correctly Ordered

Younger Abstention Because The Case

Implicates Important State Interests And

Old Vail Has An Adequate Opportunity To

Litigate Its Constitutional Claim In State

Court.

The Court has said that there are two primary

types of abstention: Pullman abstention and Younger

abstention. Where the former involves unsettled issues of

state law, the latter involves

considerations of comity and

federalism, both as they relate

to the State’s interest in

pursuing an ongoing state

proceeding, and as they involve

the ability of the state courts to

consider federal constitutional

claims in that context.

Ohio Bureau of Employment Services v. Hodory, 431 U.S.

471, 477, 97 S. Ct. 1898, 1902-03, 52 L. Ed. 2d 513 (1977).

In Younger, one of the plaintiffs was being

prosecuted under a California statute, and he filed suit in

district court to have that statute declared unconstitutional.

401 U.S. at 38-39, 91 S. Ct. 747-48. The Court held that

relief was barred because of a policy against federal

intervention in state criminal proceedings. In discussing this

policy the Court used the term “Our Federalism,” and spoke

of comity and a reluctance to interfere with legitimate state

activities. 401 U.S. at 43-45, 91 S. Ct. at 750-51.

In subsequent decisions the Court extended

the Younger doctrine into the civil arena. In Middlesex

County Ethics Comm. v. Garden State Bar Ass’n, 457 U.S.

423, 432, 102 S. Ct. 2515, 2521, 73 L. Ed. 2d 116 (1982),

the Court stated:

The policies underlying

Younger are fully applicable to

noncriminal judicial

proceedings when important

state interests are involved.

In the context of non-criminal proceedings, the Court said

that three factors should be considered: (1) whether there is a

pending state proceeding; (2) whether the proceeding

implicates important state interests; and (3) whether there is

an adequate opportunity in the state proceeding to raise

constitutional issues. /d.

In this case the Court of Appeals correctly

concluded that all three factors exist. There is a pending state

court proceeding. The proceeding implicates important state

interests; the memorandum decision by the Court of Appeals

referred to land use planning as such an interest. The case

implicates other important state interests, including a state-

sanctioned mechanism for building public improvements, and

bonds issued by the County to finance those improvements.

Finally, Old Vail has had an adequate opportunity to raise its

constitutional claim in the state proceeding, and in fact

asserted the identical takings claim as in the district court and

pursued that claim to the point of a judgment on the merits.

Indeed, Old Vail concedes that each of the

Younger factors is present. Old Vail acknowledges that it

filed suit in state court on the same day it filed in district

court. Petition at 5-6. Old Vail allows that the state court

proceeding “unequivocally touches and concerns a sensitive

area of social policy” -- i.e., an important state interest. /d. at

22. Finally, Old Vail admits that it has had the opportunity to

assert its takings claim in state court and has in fact done so.

Id. at 5-6.

Because Old Vail concedes that the Younger

factors are present, Old Vail has failed to show that the Court

of Appeals erred in ordering Younger abstention.

II. Pullman Abstention Would Not Be Proper

Because There Is No Unsettled Issue Of

State Law.

In its petition, Old Vail fails properly to

analyze the nature of Pullman abstention and how that

doctrine fits with the facts here. Pullman involved a

constitutional challenge in district court to an order by the

Texas Railroad Commission. 312 U.S. at 497-98, 61 S. Ct. at

644. A question arose in the case as to whether the Railroad

Commission’s order was within the powers granted under

Texas law. 312 U.S. at 498-99, 61 S. Ct. at 644.

In the course of its decision the district court

made a determination about Texas law -- which the Court

characterized as a “forecast.” 312 U.S. at 499, 61 S. Ct. at

645. The Court held that rather than make such a forecast,

the district court should abstain until the state law issue could

be decided in state court. 312 U.S. at 501-02, 61 S. Ct. at

645-46. Ifthe state court determined that the Railroad

Commission lacked the power to enter the challenged order,

the constitutional issue would never arise. Jd In sum,

Pullman stands for the proposition that where an unsettled

question of state law may be resolved in a state proceeding so

as to render unnecessary the constitutional issue, the district

court should abstain until the state law question is decided.

In its petition, Old Vail pays scant attention to

the purpose of Pullman abstention, even though Old Vail

insists that the doctrine should have been applied by the Court

of Appeals. The only argument that Old Vail makes about

any unsettled issue of state law is the following:

Old Vail’s taking claim does

not involve interpretation of an

[sic] single legislative

enactment. Instead, the taking

claim involves the synergistic

effects of the County of

Riverside specially assessing

Old Vail’s Property at a

commercial rate while the City

of Temecula down-zoned the

Property from “Commercial” to

“Office Professional” use;

thereby destroying the

Property's economic viability.

Petition at 23-24.

As seen above, Old Vail does not point to any

unsettled state statute or regulation that might render

adjudication of the takings claim unnecessary. Rather, Old

Vail is arguing that the unsettled issue is the application of

state law to a particular set of facts. Put another way, Old

Vail is arguing that “if I win my state law claim I won’t need

to pursue my constitutional claim.” An unresolved state law

claim, however, does not equate to an unsettled issue of state

law under Pullman. Cf. City of Houston vy. Hill, 482 U.S.

451, 467-68, 107 S. Ct. 2502, 2512-13, 96 L. Ed. 2d 398

(1987) (Pullman abstention improper because the challenged

city ordinance was unambiguous); Hawaii Housing Auth. y.

Midkiff, 467 U.S. 229, 230, 104 S. Ct. 2321, 2324, 81 L. Ed.

2d 186 (1984) (Pullman abstention improper because the

challenged state statute was unambiguous).

Il.

Pullman Abstention Would Not Be Proper

Because Old Vail Has Voluntarily Litigated

Its Takings Claim In State Court.

Old Vail’s petition also fails to address that in

applying Pullman, the Court has held that the right to return

to district court after the state law question is decided may be

waived:

[I]f a party freely and without

reservation submits his federal

claims for decision by the state

courts, litigates them there, and

has them decided there, then --

whether or not he seeks direct

review of the state decision in

this Court -- he has elected to

forgo his right to return to the

District Court.

England v. Louisiana State Bd. of Medical Examiners, 375

U.S. 411, 419, 84 S. Ct. 461, 467, 11 L. Ed. 2d 440 (1964).

1]

Old Vail has run afoul of the Eng

litigating its takings claim to judgment in state co

than reserving the claim for disposition in the dist

action. Having litigated the takings claim in state

without reservation, Old Vail cannot now assert ;

Pullman to bring the takings claim back to distri

CONCLUSION

The Court of Appeals properly or

Younger abstention because Old Vail’s state cou

implicates important state interests, and Old Vail

its takings claim in that action.

Dated: September !4, 1997.

Respectfully submitted,

W. DOUGLAS KARI

ORRICK, HERRINGTON & SUTCL

WILLIAM C. KATZENSTEIN

TIMOTHY J. DAVIS

COUNTY OF RIVERSIDE

By: W. Douglas Kari

Attorneys for Respondent

County of Riverside

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