Appendix — Remus v. City of Kalamazoo

‘ Supreme Court, U.S.

a“ FILED

97 1016 DEC 1 9 1997

OFFIGE OF THE CLERK

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM 1997

RICHARD C. REMUS, TRUSTEE FOR

SUPERIOR METAL SHREDDERS, INC.,

Petitioner,

CITY OF KALAMAZOO,

Respondent.

On Petition For A Writ of Certiorari

From The United States Court of Appeals

For The Sixth Circuit

APPENDIX TO PETITIONER’S

PETITION FOR WRIT OF CERTORARI

Theo. P. Hentchel

Counsel of Record

165 Capital Avenue N.E.

Battle Creek, MI 49017

(616) 962-4841

Attorney for Petitioner

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INDEX FOR APPENDIX

Opinion of Sixth Circuit

Court of Appeals

Judgment of District Court

Opinion of District Court

Opinion of Michigan

Court of Appeals

Denial of Application to

Michigan Supreme Court

Respondent Correspondence

of November 21, 1979

Letter of Edison

Neighborhood Council

Petitioner’s Counter-Complaint

in State 1980 Case

8 Page Summary of Events of

Petitioner’s Predecessor and

Owner of Shredder

U.S. Constitution,

Amendment 5

U.S. Constitution,

Amendment 14

Page

Al

Al2

Al4

A24

A28

A30

A32

A35

A43

A44

U.S. Constitution,

Article 5, Section 1

Title 28, § 1738

(Full Faith and Credit)

Title 42, § 1983

A45

A46

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ee

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- A et BAO a i EN

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION

No. 96-2200

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

RICHARD C. REMUS, TRUSTEE FOR

SUPERIOR METAL SHREDDERS, INC.,

Appellant, ON APPEAL FROM

THE UNITED STATES

Vv. DISTRICT COURT

FOR THE WESTERN

CITY OF KALAMAZOO, DISTRICT OF

MICHIGAN

Appellee.

/

BEFORE: SUHRHEINRICH, MOORE, and CLAY,

Circuit Judges.

PER CURIAM. Richard C. Remus,

bankruptcy trustee for Superior Metal

Shredders, Inc., appeals the district

court’s grant of the City of Kalamazoo’s

motion for summary judgment and dismissal

of his "takings" claim under the doctrine

of res judicata. For the reasons set

forth below, we AFFIRM the lower court’s

decision.

ie

Superior Metal Shredders, a recycling

and salvage company, operated an

automobile shredder in the City of

Kalamazoo. Superior continued to operate

the shredder even after the City revoked

its license.

a2

The 1980 State Court Action

In 1980, the City brought a state

court action against Superior to enjoin it

from operating the shredder without a

license. Superior filed a counter-

complaint alleging that the City’s

revocation of its license violated its

rights under the Michigan and United

States Constitutions. Superior also

alleged that the City had "unreasonably

and unjustly, arbitrarily and without

cause harassed [Superior] and caused the

shut -down of [Superior’s] business

activities to the extent that [Superior]

ha[s] found it necessary to submit to

reorganization." (J.A. 133) In fact,

Superior did file for bankruptcy on

October 4, 1980. In September 1984,

Superior’s Chapter 11 bankruptcy petition

was converted to a Chapter 7 liquidation

proceeding, and the bankruptcy court

appointed Richard C. Remus as bankruptcy

trustee.

On October 15, 1984, the state court

issued a permanent injunction prohibiting

superior from operating the shredder. The

court dismissed the City’s action,

including Superior’s counter-complaint,

with prejudice. Neither David Rosenberg,

the former owner and sole shareholder of

Superior, nor trustee Remus appealed this

decision. Through the bankruptcy court

proceedings, superior was dissolved and

the assets of the company sold to an

unrelated third party, Kalamazoo Metal

A2

Recycling, Inc.

The First Federal District Court Action

Rosenberg then filed an action in

United Stated district court, alleging

that the City deprived him of property

without just compensation in violation of

the Fifth and Fourteenth Amendments of the

United States Constitution and Article 10,

Section 2 of the Michigan Constitution.

Upon the City’s motion, the district court

dismissed the complaint for lack of

subject matter jurisdiction pursuant to

Williamson County Regional Planning

Commission v Hamilton Bank of Johnson

City, 473 US 172 (1985). Williamson holds

that a property owner cannot claim a

violation of the takings clause until it

has used any available adequate state

procedures for obtaining just compensation

and been denied such compensation. Id. at

186-87. The district court found chat

Superior had not pursued available state

procedures to obtain compensation, and

thus held that Superior’s takings claim

under the federal Constitution was not

ripe for adjudication. Accordingly, the

district court, in an order dated January

6, 1989, dismissed this claim and

Superior’s pendent claim ounder- the

Michigan Constitution.

The 1989 State Court Action

In September 1989, trustee Remus

A3

filed an action in Michigan state court

alleging that the City had taken

Superior’s property without just

compensation in violation of the Fifth and

Fourteenth Amendments to the United States

Constitution and Article 10, Section 2 of

the Michigan Constitution. The trial

court found that Superior either had

raised the claims, or could have raised

them in the 1980 state court action.

Accordingly, the court held that the

action was barred by the doctrine of res

judicata and granted the City’s motion for

summary judgment. The Michigan Court of

Appeals affirmed the trial court and

denied Remus’ subsequent motion for a

rehearing, and the Michigan Supreme Court

denied leave to appeal. Remus then filed

a petition for writ of certiorari with the

United States Supreme Court. However,

when Remus failed to cure certain defects

in the petition, it was ultimately

rejected and never docketed.

Proceedings Below

On July 26, 1995, Remus brought the

present suit in federal district court

pursuant to 42 U.S.C. §1983, alleging that

the City deprived Superior of its property

without just compensation in violation of

the Fifth and Fourteenth Amendments to the

United States Constitution. In response,

the City filed a motion to dismiss and for

summary judgment. On August 15, 1996, the

district court issued an opinion and a

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SSD Sn a am Nie ON Re SAE Yeti REET Aer MF ENN

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judgment order, granting the City’s motion

and dismissing Remus’ claim on the ground

that it was barred by the doctrine of res

judicata. The court based this ruling on

the full faith and credit provision of 28

U.S.C. §1783, which mandates that federal

courts give a prior state court

adjudication the same effect it would have

in state court. The court found that

Michigan courts had determined that the

1989 state court action was barred by the

doctrine of res judicata, and thus ruled

that because the present suit was

virtually identical to the 1989 state

court action, res judicata acted to bar

the current suit. Finally, the district

court rejected Remus’ claim that the state

courts had wrongly decided the res

judicata issue, stating that only the

United States Supreme Court may review the

state courts’ determination. This appeal

timely followed.

il.

This Court reviews a district court’s

grant of summary judgment de novo,

applying the same test as that used by the

district court in reviewing a motion for

summary judgment. Barnhart v Pickrel,

Schaeffer & Ebeling Co., 12 F.3d 1382,

1388 (6th Cir. 1993) (quotations and

internal citations omitted). Summary

judgment is appropriate when the record

reveals that there are no genuine issues

of material fact and the moving party is

entitled to judgment as a matter of law.

Fed. R. Civ. P. 56(c); Celotex Corp. v

A5

Catrett, 477 U.S. 317, 322-23 (1986).

In reviewing a motion for summary

judgment, this Court must '- determine

"whether the evidence presents a

sufficient disagreement to require

submission to a jury or whether it is so

one-sided that one party must prevail as a

matter of law." Anderson v Liberty Lobby,

Inc., 477 U.S. 242, 251-52 (1986). "(T]he

mere existence of some alleged factual

dispute between the parties will not

defeat an otherwise properly supported

motion for summary judgment ; the

requirements that there be no genuine

issue of material fact." Id. at 247-48

(emphasis in original). Thus, once the

movant has satisfied its initial burden of

demonstrating that the non-movant has no

evidence to support an essential element

of its case, the non-movant must respond

by presenting evidence that demonstrates a

genuine issue of material fact. A mere

"Scintilla" of evidence is insufficient to

withstand summary judgment. Id. at 252.

Finally, this Court must affirm the lower

court’s grant of summary judgment if it is

correct for any reason, even one that the

lower court did not consider. Silver _v

Franklin Township Bd. of Zoning Appeals,

966 F.2d 1031 (6th Cir. 1992).

The district court found that Remus’

Claim was barred by the doctrine of res

judicata. On appeal, Remus argues that

the district court improperly applied the

full faith and credit clause of 28 U.S.C.

§1783 to reach this conclusion. Upon

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Sac ab ANOgSth s AA C AS act

review of the case, however, we find no

reason to disturb the district court’s

finding. Section 1783 of Title 28 of the

United States Code requires that federal

courts give state court decisions the same

full faith and credit that they would

receive "in the courts of such state".

Thus, a prior state court adjudication has

the same effect in federal court as it

would in state court. Marrese v_ Am.

Academy of Orthopaedic Surgeons, 470 U.S.

373, 379. (3963).

The doctrine of res judicata applies

to claims premised upon 42 U.S.C. §1983

that were previously litigated in state

court. Migra v Warren City School Dist.

Ba. of EBaue., 465 U.8. 75, 81 (1984).

Under Michigan law, res judicata, or claim

preclusion, prevents a plaintiff from

litigating a claim that actually was

litigated or could have been litigated in

an earlier proceeding. Eliason Corp. v

Bureau of Safety & Regulation of Michigan

Dept. of Labor, 564 F.Supp. 1298 (W.D.

Mich. 1983). Under the doctrine, a

subsequent legal action is barred if: (1)

the parties or their privies are the same;

(2) the prior judgment was rendered by a

court of competent jurisdiction; (3) the

prior judgment was a final judgment on the

merits; and (4) the two suits involve the

same cause or causes of action that are

brought, or could have been brought, in

the prior litigation. Allen v McCurry,

449 U.S. 90, 94 (1980); Brownridge “v

Michigan Mut. Ins. Co., 115 Mich App 745,

A7

748-49 (1982).

The district court properly gave full

faith and credit to the Michigan circuit

court’s res judicata determination, as the

elements of the doctrine have been met in

this case. First, the parties in the two

state court actions are properly treated

as the same; trustee Remus possesses only

those rights possessed by the dektor-

corporation and "the trustee stands in the

shoes of the debtor", Superior. Matter of

Light, 23 B.R. 482, 484 (Bankr. E.D. Mich.

1982). Second, there is nothing to

suggest that the Michigan circuit court

lacked jurisdiction to hear Remus’ claim.

Third, the circuit court’s 1984

dismissal of Superior’s claim with

prejudice constitutes a final judgment on

the merits for purposes of applying res

judicata. Brownridge, 115 Mich App at

748. A trial, witnesses, or a written

opinion are not necessary- so long as the

parties have had an opportunity to be

heard. See e.g., Eliason Corp., 564 F.

Supp. at 1301 (holding that a dismissal

for lack of progress can constitute

adjudication on the merits, where there

was "individualized consideration, in

which the trial court considers all the

pertinent circumstances of a particular

Gnee . « «*F:

Fourth, the present suit involves the

same cause or causes of action that were

brought, or could have been brought, in

prior litigation. Indeed, Remus’ current

argument - that the City, by regulating

A8

Superior’s operation of the shredder,

rendered it economically unviable and thus

"took" Superior’s property - is the same

contention raised by Superior in its 1980

counter-complaint and in the 1989 state

court action. In Michigan, "(t]he test

for determining whether two claims arise

out of the same transaction and are

identical for res judicata purposes is

whether the same facts or evidence are

essential to the maintenance of the two

actions." Jones v State Farm Mut. Auto

Ins. Co., 202 Mich. App. 393, 401 (1993)

(internal citation omitted). te .-$e8

irrelevant whether the grounds asserted

for relief are similar. Id. at 401.

The plaintiff in this case raises no

new theories of liability and offers no

new facts or evidence in support of this

most recent action. The cases thus

involve the same matter or issue; the very

words in the complaint are identical to

his earlier effort, duplicated verbatim

into the current complaint. The district

court was therefore correct in holding

that Remus’ claims were barred by res

judi a.

Moreover, even if Remus’ current

claim is viewed as being different from

Superior’s 1980 counter-complaint,

Superior easily could have raised a pure

"takings" claim during either or both of

the prior proceedings. The City argued,

and the Michigan courts concluded in 1990,

that Superior raised a takings claim in

the prior (1980) suit by alleging, in its

A9

counter-complaint, that the City’s

"unreasonable" and "arbitrary" regulation

of the shredder "caused the shut down of

[its] business activities." That

counterclaim was dismissed with prejudice

by the state court and Remus is therefore

barred from relitigating it here.

However, even if this Court concludes that

Superior did not raise a takings claim in

the first state court action, Remus’

action is still barred by the doctrine of

res judicata under Michigan law because

Superior could have and should have raised

a takings claim in that prior action.

Remus also argues that the state

courts wrongly decided the res judicata

issue, and thus that the district court

improperly granted full faith and credit

to their decision on that issue. It is,

however, well settled that only the United

States Supreme Court may review a

determination of a state’s highest court.

In re Sun Valley Foods Co., 801 F.2d 186,

189 (6th Cir. 1986). A United States

district court "has no authority to review

final judgments of a state court in

judicial proceedings." Id. (quoting

District of Col i our £ is _v

Feldman, 460 U.S. 462, 482 (1983).

In addition, Remus argues that the

federal constitutional claim asserted in

his 1989 state court action was not ripe.

However, Remus had the opportunity to

litigate the question of ripeness in state

court, he raised at least some of his

ripeness arguments there, and the Michigan

Al0

Court of Appeals addresses this issue.

Remus therefore may not collaterally

attack the state court’s determination.

Ins. Corp. of Ireland, Ltd. v Compagnie

des Bauxites de Guinee, 456 U.S. 694, 702

n.9 (1982) ("A party that has had an

Opportunity to litigate the question of

subject-matter jurisdiction may not ;

reopen that question in a collateral

attack upon an adverse judgment.").

Iit.

Accordingly, we hold that the

district court properly found the present

Suit barred by the doctrine of res

judicata, and hereby AFFIRM the district

court’s grant of the City’s motion for

summary judgment and dismissal of Remus’

claim.

All

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

RICHARD C. REMUS, TRUSTEE FOR

SUPERIOR METAL SHREDDERS,

INC.,

File No. 4:95-CV-136

Plaintiff,

Hon. Benjamin F.

Gibson

Vv.

THE CITY OF KALAMAZOO,

Defendant. JUDGMENT

-/

At a session of the Court held in and for

said District and Division, in the City of

Grand Rapids, Michigan this 15th day of

August, 1996.

PRESENT : HON. BENJAMIN F. GIBSON,

U.S. DISTRICT JUDGE

In accordance with the Opinion

entered this date,

IT IS HEREBY ORDERED that defendant’s

motion to dismiss and motion for summary

judgment (pleading no. 7) is GRANTED.

IT IS FURTHER ORDERED that JUDGMENT

is granted for defendant the City of

Kalamazoo and against plaintiff Richard C.

Remus, Trustee for Superior Metal

Shredders, Inc.

Al2

IT IS SO ORDERED.

ae ee pon

Benjamin Gibson

US District Judge

Katte aki 82 Ste anti

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UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

RICHARD C. REMUS, TRUSTEE FOR

SUPERIOR METAL SHREDDERS,

Aas oe

File No. 4:95-CV-236

Plaintiff,

Hon. Benjamin F.

Gibson

4

THE CITY OF KALAMAZOO,

Defendant. OPINION

/

Richard C. Remus, bankruptcy trustee

for Superior Metal Shredders, Inc.

("SMS"), brings this action against the

City of Kalamazoo ("the City") pursuant to

Title 42 United States Code Section 1983,

alleging that the City deprived SMS of its

property without just compensation, in

violation of the Fifth and Fourteenth

Amendments to the United States

Constitution. In response, the City

requests that the Court dismiss’~ the

complaint or enter summary judgment in its

favor. For the following reasons, the

Court will grant the city’s motion.

be

A.

SMS, a recycling and salvage company,

Al4

operated an automobile shredder in the

City of Kalamazoo. After the City revoked

SMS‘s license, SMS continued to opexate

the shredder. In 1980, the City brought a

state court action against SMS to enjoin

its operation of the business without a

license and to abate a nuisance. SMS

filed a counter-claim alleging that in

revoking the license the City violated

SMS’s rights under the Michigan And United

States Constitutions. Counter-claim at ]

8. SMS further alleged that the City had

"unreasonably and unjustly, arbitrarily

and without cause harassed Counter-

Plaintiff and caused the shut-down of

Counter-Plaintiffs’ business activities to

the extent that the Counter-Plaintiffs

have found it necessary to submit to

Federal Bankruptcy Court for the purpose

of corporate reorganization." Counter-

claim at §¢ 10.

In September 1984, upon motion of

SMS’s creditors, SMS’s Chapter 11 petition

was converted to a Chapter 7 liquidation

proceeding. The Bankruptcy Court

appointed Richard Remus bankruptcy

trustee.

On October 15, 1984, the state court

issued a permanent injunction, prohibiting

operation of the shredder. The court

dismissed the action, including SMS’s

counter-claim, with prejudice. Neither

David Rosenberg, the former owner and sole

shareholder of SMS, nor trustee Remus

appealed this decision.

SMS was dissolved and Remus sold the

Al5

company’s assets. Thereafter, Kalamazoo

Metal Recycling, Tac., an unrelated

company, purchased the assets from the

first purchaser. Upon Kalamazoo Metal

Recycling, Inc.’s motion, and over the

City’s objection, the state court

dissolved the permanent injunction,

allowing that company to operate the

shredder.

B.

Rosenberg then filed an action in

this Court, alleging that the City

deprived him of property without just

compensation, in violation of the Fifth

and Fourteenth Amendments of the United

States Constitution and Article 10,

Section 2 of the Michigan Constitution.

Upon the City’s motion, the court

dismissed the complaint for lack of

subject matter jurisdiction under

Williamson County Regional Planning Comm’n

v_Hamilton Bank of Johnson City, 473 U.S.

172 (1985).

To review the applicable law, the

Fifth Amendment proscribes governmental

taking of private property without just

compensation. * No federal constitutional

violation occurs until just compensation

1"The Fifth Amendment provides ‘nor shall

private property be taken for public use,

without just compensation.’ The Fifth

Amendment prohibition applies against the

States through the Fourteenth Amendment."

McDonald, Sommer & Frates v. Yolo County,

477 U.S. 340, 342 n.1 (1986) (citations

omitted) .

Alé

is denied. A federal takings claim

becomes ripe only after a claimant has

used the available state procedure and has

been denied just compensation.

Williamson, 473 U.S. at 195; see also

Bigelow v. Michigan Dep’t of Natural

Resources, 970 F.2d 154, 158 (6th Cir.

1992); Macene v. MJW, Inc., 951 F2d 700,

704 (6th Cir. 1991).

Plaintiff had not pursued the

available state procedure and so had not

been denied just compensation. Therefore,

plaintiff’s takings claim under’ the

federal Constitution was not ripe for

adjudication. Accordingly, on January 6,

1989, the Court dismissed the federal

claim and plaintiff’s pendent claim under

the Michigan Constitution.

In September 1989, bankruptcy trustee

Remus filed a state court action against

the City alleging a taking without just

compensation, under both the state and

federal Constitutions. The state court

complaint included two counts: Count Rs

State Taking; and Count II, Federal

Taking. In his state court complaint,

plaintiff alleged as follows:

This is an action to redress the

deprivation under color of the

City of Kalamazoo’s local

ordinance of a privilege secured

to the Plaintiff under the Sth

Amendment to the United States

Constitution and 14th Amendment

to the United States

Constitution and under Article

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a

10, Section 2 of the Michigan

Constitution of 1963 for a

taking of private property by

the Defendant, City of

Kalamazoo, without just

compensation, a right and

privilege afforded to all

persons within the jurisdiction

of the United States and the

State of Michigan.

The state trial court found that

plaintiff either had raised the claims, or

could have raised them in the 1980 state

court action. Accordingly, the court held

that the action was barred by res judicata

and granted the City’s motion for summary

disposition. The Michigan Court of

Appeals affirmed. After the Michigan

Court of Appeals denied plaintiff’s motion

for a rehearing, the Michigan Supreme

Court denied leave to appeal. Plaintiff

did not file a petition for writ of

certiorari with the United States Supreme

Court. .

Thereafter, plaintiff filed the

instant action pursuant to Title 42 United

States Code Section 1983, alleging that

the City deprived SMS of its property

without just compensation, in violation of

the federal Constitution. In his

complaint, plaintiff alleges as follows:

This is an action to redress the

deprivation under color of the

City of Kalamazoo’s local

ordinance of a privilege secured

to the plaintiff under the Sth

Als

Amendment to the United States

Constitution and the 14th

Amendment to the United States

Constitution for a taking of

private property by the

defendant, City of Kalamazoo,

without just compensation, a

right and Privilege afforded to

all persons within the

jurisdiction of the United

States.

Paragraph 3.

In response to the complaint, the

City argues that this action is barred

both by the doctrine of res judicata and

by the statute of limitations.

ak.

In reviewing defendants’ request for

dismissal, the Court must accept as true

the material allegations in plaintiff's

complaint. Summit Health Ltd. v. Pinhas,

500 U.S. 322, 325 (1991). The Court must

construe the complaint in the light most

favorable to plaintiffs. However, the

Court is not required to accept as true

plaintiffs’ legal conclusions or any

unwarranted factual inferences. See

Morgan v. Church’s Pried Chicken, 829 F.2q

10, 12 (6th Cir. 1987).

Summary judgment is proper if the

pleadings, depositions, answers to

interrogatories, and admissions on file,

together with affidavits, if any, show

that there is no genuine issue as to any

material fact and that the moving party is

entitled to judgment as a matter of law.

Alg

aii i a vl

| Fed. R. Civ. P. 56(c); Canderm Pharmacal,

| Ltd. v. Elder Pharmaceuticals, Inc., 862

F2d 597, 601 (6th Cir. 1988). In ruling

| on a motion for summary judgment, the

Court must determine "whether the evidence

| presents a sufficient disagreement to

| require submission to a jury or whether it

is so one-sided that one party must

prevail as a matter of law." Anderson v.

Liber Lob Inc., 477 U.S. 242, 248

(1986); see also Street v. J.C. Bradford &

Co., 886 F.2d 1472, 1479 (6th Cir. 1989).

Sak

The City first argues that

plaintiff’s claim is barred by’ the

doctrine of res judicata. Title 28 United

States Code Section 1738 requires that

federal courts give state court decisions

the same full faith and credit that they

would have "by law or usage in the court

of such State." Thus, a prior state court

adjudication has the same effect in

federal court as it would in state court.

Marrese v. American Academy of Orthopaedic

Surgeons, 470 U.S. 373, 379 (1985); Migra

v. Warre i S Dist. Bd. uc.

465 U.S. 75, 81 (1984). The doctrine of

res judicata applies to claims premised

upon Title 42 United States Code Section

1983 which previously were litigated in

state court. Migra, 465 U.S. at 81-85.

Under Michigan law, res judicata or

claim preclusion prevents a plaintiff from

litigating a claim that actually was

litigated or court have been litigated in

an earlier proceeding. ison << -

A20

Bureau of Safety & Regulation of Michigan

D

ep’t of Labor, 564 F. Supp. 1298 (W.D.

Mich. 1983); Gose v. Monroe Auto Equipment

Co., 409 Mich. 147, 294 N.W.2da 165 (1980) ;

Carter v. Southeastern Michigan Transp.

Authority, 135 Mich. App. 261, 351 N.W.2d

920, 921 (1984). Claim preclusion

requires that: (1) the cause of action of

the first and second suits must be the

same; (2) the parties or their privies

must be the same; and (3) the prior

judgment must be on the merits. In re

Pardee, 190 Mich. App. 243, 475 N.W.2d

870, 873 (1991).

First, plaintiff asserted a takings

claim under the federal Constitution in

the 1989 state court action; he asserts

the same claim here. Second, the parties

to the actions are the same. Third, the

state courts determined that the 1989 stat

court action was barred by the doctrine of

res judicata.

Plaintiff now argues that the state

courts wrongly decided the res judicata

issue. However, only the United States

Supreme Court may review the State courts

determination. In re Sun Valley Foods

Co., 801 F2d 186, 189 (6th Cir. 1986)

(citations omitted). This court "has no

authority to review final judgments of a

state court in judicial proceedings." Id.

(quoting District of Columbia Court of

Appeals v. Feldman, 460 U.s. 462, 482

(1983)). "This is true, even though the

state court judgment may have been

erroneous." Id. (citations omitted) .

A21

Similarly, plaintiff argues that the

federal constitutional claim that he

asserted in 1989 state action was not

ripe. However, plaintiff had _ the

opportunity to litigate the question of

ripeness in state court, he raised at

least some of his ripeness arguments, and

the Michigan Court of Appeals addressed

this issue. Plaintiff may not

collaterally attack the state court’s

determination. insurance Corp. of

Ireland, Ltd C ; :

de Guinee, 456 U.S. 694, 702 n.9 (1982)

("A party that has had an opportunity to

litigate the question of subject-matter

jurisdiction may not, however, reopen that

question in a collateral attack upon an

adverse judgment."); Welch v. District

Court, 215 Mich. App. 253, 545 N.W.2d 15,

17 (1986) (citing In re Hatcher, 443 Mich.

426, 505 N.W.2d 834 (1993) ("A party may

collaterally attack or challenge subject

matter jurisdiction only on direct

appeal."); Auditor General v. Olezniczak,

302 Mich. 336, 4 N.W.2d 679 (1942).

Accordingly, the Court finds that the

instant action is barred by the doctrine

of res judicata.’

For the reasons set forth above, the

Court will grant the City’s motion to

dismiss or for summary judgment.

*Because the Court so finds, the Court

will not discuss defendant’s arguments

based upon the statute of limitations.

A22

BENJAMIN F. GIBSON

U.S. DISTRICT JUDGE

DATED: August 15, 1996

A23

STATE OF MICHIGAN

COURT OF APPEALS

RICHARD C. REMUS, Trustee for

SUPERIOR METAL SHREDDERS, INC.,

Plaintiff-Appellant,

March 6, 1992

Vv

No. 133554

THE CITY OF KALAMAZOO,

a Michigan municipal corporation,

Defendant -Appellee.

Before Brenna, P.L., and Holbrook, Jr.,

and McDonald, JJ.

PER CURIAM.

Plaintiff through its bankruptcy

trustee appeals as of right an order of

the Kalamazoo Circuit Court granting

defendant’s motion for summary

disposition. Plaintiff’s sole issue on

appeal is whether the circuit court erred

by applying res judicata in barring its

taking claim. We affirm.

After receiving complaints about

nose, vibrations and pollution, defendant

revoked plaintiff’s license to operate its

automobile shredder on December 16, 1980.

Despite the revocation of its license,

plaintiff continued to operate the

shredder. Defendant then filed suit to

enjoin plaintiff from operating the

shredder without a license and to abate

the nuisance. The circuit court issued a

A24

nennenemeenennnenenenidiniteenetnteanaiiiil

temporary restraining order against

Plaintiff.

On December 23, 1980, plaintiff filed

a counterclaim against defendant, alleging

that defendant acted unreasonably and

arbitrarily in revoking Plaintiff’s

irreparable injury if its license was not

reinstated. The Circuit court revoked the

temporary restraining order and

conditioned future Operation of the

shredder upon plaintiff’s compliance with

the conditions Placed on the license.

After additional complaints from

residents, the circuit court permanently

enjoined plaintiff from Operating the

shredder on october 15, 1984. As part of

that order, the circuit court dismissed

counterclaim.

In September 1989, plaintiff filed

the instant action against defendant,

alleging that by virtue of the October

1984 permanent injunction, defendant had

improperly taken Plaintiff's property

the federal and state constitutions.

Following a hearing, the circuit court

found that Plaintiff’s December 1980

counterclaim was essentially a taking

Claim. Since Plaintiff’s counterclaim was

dismissed with Prejudice, the circuit

A25

court held that plaintiff's September 1989

complaint was barred by res judicata.

Res judicata bars a subsequent suit

between the same parties when the facts or

evidence essential to the two suits are

identical and the issues and parties or

privies are identical. Ozark v Kais, 184

Mich App 302, 307; 457 NW2d 145 (1990).

There are three prerequisites to applying

the doctrine of res judicata: (1) the

prior action must have been decided on its

merit; (2) the issues raised in the second

case have been resolved in the first; and

(3) both actions must have involved the

same parties or their privies. Richardson

v DAHF, 180 Mich App 704, 708; 447 NW2d

791 (1989).

The first and third prerequisites for

applying res judicata are met here. The

circuit court dismissed with prejudice on

October is, 1984, plaintiff’s

counterclaim. An order dismissing an

action with prejudice is a final judgment

on the merits for the purpose of res

judicata. Brownbridge v Michigan Mutual

Ins.Co., 115 Mich app 745, 748; 321 NW2d

698 (1982). Both suits also involve the

same parties. Richard Remes, as_ the

bankruptcy trustee, stands in the shoes of

the debtor corporation and has the right

to bring whatever actions the debtor could

bring on its own behalf. 9 Am Jur 2d,

Bankruptcy, SS290, p 310. We believe that

a trustee in bankruptcy has such an

identification of interest with the debtor

as to be in privy to represent the same

A26

legal right as the debtor. Sloan vy City

+ 425 Mich 288, 295; 389

NW2d 418 (1986) .

Prior action. Michigan Courts have

broadly interpreteg the res judicata

doctrine to hold that if the matter

See Schwartz Vv ci int, 187 mich App

191, 194; 466 NW2d 357 (1991),

Ri - Supra. Here, Plaintiff could

We find no merit in Plaintiff’,

argument that @ taking claim became "ripe"

. 3§1 (1988) ; Iv den 431 Mich 913 (1988).

Plaintiff's Claim that the taking Claim

did not accrue until it fileg for

/s/ Donald E. Holbrook, Jr.

/s/ Gary R. McDonald

A27

December 2, 1992

94118

RICHARD C. REMES, Trustee for

SUPERIOR METAL SHREDDERS, INC.,

Plaintiff-Appellant,

SC: 94118

Vv COA: 133554

LC: A89-002452-CC

THE CITY OF KALAMAZOO,

Defendant -Appellee.

On order of the Court, the

application for leave to appeal is

considered, and it is DENIED, because we

are not persuaded that the questions

presented should be reviewed by this

Court.

A28

Inter-Office City of Kalamazoo

MEMO

To: Hon. Mayor Annen ¢ City Commissioners

Date: November 21, 1979

From: Don M. Schmidt, City Attorney

Re: Superior Meta] Shredders, Inc.

Hon. Mayor ¢& Commissioners

November 21, 1979

Page 2

* * &

From the complaints that have been

received from the neighbors, it appears

Cf various materials, lessening of

explosive Occurrences, and a lessening in

necessary funds to cure the operation of

the metal shredder.

Respect fully submitted,

Don M. Schmidt

City Attorney

DMS : ws

cc: City Manager

City Clerk

A29

EDISON CENTER

1331 RaceStreet, Kalamazoo

Michigan 49001 616/382-0916

August 11, 1980

To: Mayor Annen and Members of the

City Commission

From: Edison Neighborhood Committee

and E. Crosstown Pkwy. Block Club

Re: Proposed conditions of Recycling

Dealers License for Superior Metal

Shredder

If the license is reviewed, we

recommend that the following stipulations

be incorporated into the conditions

proposed by Hearing Officer Martin (pages

15-17) :

i Hours of operation are irrelevant if

Shredder is not creating a nuisance.

ra Acceptable as proposed by Deputy City

Manager 8/7/80.

25 Acceptable as proposed by deputy

City Manager 8/7/80.

4. The log referred to should _ be

maintained on a daily basis.

S. Acceptable as proposed by the Deputy

City Manager 8/7/80.

6. Acceptable as proposed by Hearing

Officer Martin 6/23/80.

7. Veto: (#7 of Hearing Officer

martin’s report corresponds to #6 of

Deputy City Manager Sculley’s

report. )

a. The "regular ground vibration

readings in the Crosstown

Parkway neighborhood" should be

conducted every week for an

A30

€ight-hour time Period, with 300

vehicles Processed. The cj ty

Manager Should be Provided with

Should be ~60 dbgs, the leve]

determineg by Dr. Campanella to

be the threshold of feeling.

We concur with the additional Conditions

recommended by the Deputy City Manager

10. The City Commission may immediately

with the City Manager, must be

Presented to the City Commission

11. Upon revocation of the Department of

Basic Counselling

Allen Corp.

Senior Citizens

Emergency Services

Neighborhoog Development

A31

COUNTER-COMPLAINT IN STATE

1980 ACTION OF PETITIONER

se @ ©

# That at said hearing Counter-

Defendant unreasonably, arbitrarily and

without any pretense of due process as

that term is defined by Michigan and

Federal Case Law revoked said license.

8. That this revocation is

arbitrary, unjust, unreasonable and devoid

of any reasonable relation to any objects

or purposes which might be sought to be

accomplished by said ordinance and is void

and of no effect and violative of the

Constitution of the State of Michigan and

the Constitution of the United States of

American and the Fourteenth Amendment

thereto.

9. That the Counter-Defendants and

their respective agents and employees and

persons acting under their control and

direction have attempted to enforce

through this court and through other

proceedings and threatened to attempt to

enforce this ordinance the revocation of

this license and to force and compel

Counter-Plaintiff to cease operation of

their business all in the utmost bad faith

and for political motives and for

political gain.

10. That Counter-Plaintiffs have

incurred expenses in excess of One Million

Dollars ($1,000,000.00) to bring a much

needed service and operation to the City

of Kalamazoo and despite the fact that the

Counter-Plaintiffs have complied with all

A32

tS

reasonable requests of the City of

Kalamazoo, that the Counter-Defendant has

unreasonably and unjustly, arbitrarily and

to Counter-Plainti¢s in that Counter-

Plaintiff will be forced Out of business

permanently due to Counter-Plaintiff’,

that said license will not be renewed

until April, 1981, if at all, Counter-

Plaintiff has no adequate remedy at law.

WHEREFORE, Counter-Plaintifs prays

that this Court grant Counter-Plaintifs

the following relief in favor of the

Counter-Plaintiff and against the Counter-

A. A Preliminary and permanent

injunction restraining the Counter-

in Court or administratively Co enforce

the revocation of Counter-Plaintifs

license to Operate a metal shredder or a

A33

———.....

recycling dealership in the City of

Kalamazoo.

B. A declatory Judgment declaring

that the revocation of Counter-Plaintiff’s

license to operate a shredding machine and

recycling dealership license was. in

violation of due process clause of the

United States Constitution and_ the

Michigan Constitution and therefore void

and of no effect.

-. That this is a claim for general

relief.

D. That the Court award to the

Counter-Defendant costs and attorney fees

regarding this matter.

DATED: December 23, 1980

MURPHY, BURNS & McINERNEY, P.C.

Attorneys for Defendants

By: Peter F. Walsh (P28040)

BUSINESS ADDRESS:

1000 Campau Square Building

180 Monroe, N.W.

Grand Rapids, MI 49503

A534

SUPERIOR

Restrictions Recommended by City Hearing

Office

June 20, 1980 August 4, 1980

Hours of Operation: 8:30 - 5:90 (M-

F)

Rate of Process: 300 vehicles per 8

hour day

Maintenance. regular, as indicated

by daily inspection

Record log: Hours of Operation,

inspection results

Materials: Inspection for fuel

Canks/removal

Materials: Verification Of fuel tank

removal

Bear costs of vibration measurements

(ground levels)

A35

(1)

(2)

(3) _

(4)

(5)

(6)

(7)

(8)

(9)

(10)

(11)

SUPERIOR

Actual License Restrictions

August 13, 1980

As recommended

As recommended

Addition - employ full-time

millwright

As recommended

Addition - inspect for transmissions,

driveshafts, etc.

Addition - structural levels (e)

cease operation if greater than 60

dbgs

Provide all bonds, license fees, and

taxes

Fully comply with all Federal, State

and Local laws

Enforcement officer provided

City may revoke on filing of

complaint

City may revoke should DNR revoke

permit

A356

SS

|

SUPERIOR

;

Operationa] Incidents

Vibration Test: Passed August a3,

1980

Materials ©xplosion - September 4, 1980

1) license revoked

December 9, 1980

Materials ©xplosion - September aS,

1980

Vibration test: Passed October 30,

1980)

Passed November 17, 1980

Respondents State

Court Original]

Action) Complaint filed

December 17, 1980

Vibration test: Passed December 1, 1980

Materials ©xplosion December 4, 1980

Vibration test:

A37

SUPERIOR

Restrictions of Preliminary Injunction

January g, 1981

(Ex. 29)

(1) Same as license

(2) Same as license

(3) Same as license

-(4) Same as license

(5) Same as license

(6) Same as license

(7) Same as license

(8) Same as license

(9) Deleted

(10) Deleted

(11) Deleted

(12) Addition: $10,000 pond

(13) Addition: $2,000 explosion bond

A38

Successors Owner Original Restrictions In

Order to Commence Operation of Shredder

1986

(1) Hours: 8:00 - 5:00 (M-F)

(2) Same as Superior license

(3) Same as Superior license

(4) Same as Superior license

(S) Deleted

(6) Same as Superior license

(7) Same as Superior license

(8) Same as Superior license

(9) Deleted

(10) Deleted

(11) Deleted

(12) Deleted

(13) Deleted

A39

Successor Owner’s Modified New hours of

Operations as of June 5, 1986

(1) Hours: 8:00 - 6:00 (M-F)

10:00 - 6:00 (Saturday)

(36% INCREASE IN HOURS)

(a) Should breakdown occur, oper&te

additional hour following day

(2) Same as previous order

(3) Same as previous order

(4) Same as previous order

(S) Same as previous order

(6) Same as previous order

(7) Same as previous order

(8) Same as previous order

A40

SS’ Oo

SUCCESSorRsS :

Operational Incidents

Vibration test: Passed May, 1986

Materials explosion: July 28, 1986

Vibration test: Passed August, 1986

Materials €xplosion: October 22, 1986

Vibration test: Passed November, 1986

Note: Vibration level increasing

A4l

Successor Owner’s Actual License

Restrictions as of

December 5, 1986

(1) Same as previous order (36% increase

in operating hours)

(2) Same as previous order

(3) Same as previous order

(4) Same as previous order

(S) Same as previous order

(6) Deleted

(7) Same as previous order

(8) Same as previous order

Transcript of new owner hearings -

November 26, 1986

Important: Court Order dismissing suit -

December 5, 1986

A4&2

U.S. CONSTITUTION,

AMENDMENT 5

gli nor be deprived of life,

liberty, or property, without due process

of law; nor shall private property be

taken for Public use, without just

compensation.

A43

U.S. CONSTITUTION

AMENDMENT 14

No State shall make or enforce

any law which shall abridge the privileges

or immunities of citizens of the United

States; nor shall any State deprive any

person of life, liberty, or property,

without due process of law; nor deny to

any person within its jurisdiction the

equal protection of the laws.

A44

U.S. CONSTITUTION

ARTICLE S,

Section 1. Full Faith and Credit

Full Faith and Credit Shall be given

in each State to the public Acts, Records,

and judicial Proceedings of every other

State. And the congress may by general

Laws prescribe the Manner in which such

Acts, Records and Proceedings shall be

proved, and the Effect thereof.

A45

TITLE 28

§1738. . . Such Acts, records and

judicial proceedings or copies thereof, so

authenticated, shall have the same full

faith and credit in every court within the

United States and its Territories and

Possessions as they have by law or usage

in the courts of such State, Territory or

Possession from which they are taken.

(June 25, 1948, ch 646, § 1, 62 Stat.

947).

A46

TITLE 42

§1983. Civil action for deprivation

of rights

Every person who, under color of any

statute, ordinance, regulation, custom, or

usage, of any State or Territory or the

District of Columbia, subjects, or causes

to be subjected, any citizen of the United

States or other person within the

jurisdiction thereof to the deprivation of

any rights, privileges, or immunities

secured by the Constitution and laws,

shall be liable to the party injured in an

actin at law, suit in equity, or other

proper proceeding for redress. For the

Purposes of this section, any Act of

Congress applicable exclusively to the

District of Columbia shall be considered

to be a statute of the District of

Columbia.

(R.S.§1979; Dec. a3, i979, *®.L. 96-170,

§1, 93 Stat. 1284.)

A47