Kottschade v. City of Rochester

• Decision Date: 13 February 2003
• Docket Number: No. 02-1504MN.,02-1504MN.
• Citation: 319 F.3d 1038
• Parties: Franklin P. KOTTSCHADE, Appellant, v. CITY OF ROCHESTER, Appellee. American Forest and Paper Association; Building Industry Legal Defense Fund of Southern California; California Building Industry Association; International Council of Shopping Centers; National Association of Industrial and Office Properties; National Association of Real Estate Investment Trusts; National Association of Realtors; Real Estate Roundtable; and Rochester (Minnesota) Area Builders, Amici on Behalf of Appellant, League of Minnesota Cities; National League of Cities; and International Municipal Lawyers Association, Amici on Behalf of Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

319 F.3d 1038

Franklin P. KOTTSCHADE, Appellant, v. CITY OF ROCHESTER, Appellee.

American Forest and Paper Association; Building Industry Legal Defense Fund of Southern California; California Building Industry Association; International Council of Shopping Centers; National Association of Industrial and Office Properties; National Association of Real Estate Investment Trusts; National Association of Realtors; Real Estate Roundtable; and Rochester (Minnesota) Area Builders, Amici on Behalf of Appellant,

League of Minnesota Cities; National League of Cities; and International Municipal Lawyers Association, Amici on Behalf of Appellee.

No. 02-1504MN.

United States Court of Appeals, Eighth Circuit.

Submitted: October 10, 2002.

Filed: February 13, 2003.

Rehearing and Rehearing En Banc Denied: March 21, 2003.

Michael M. Berger, argued, Los Angeles, CA (Gideon Kanner, Los Angeles, CA, Duane Desiderio, Washington, DC, and George O. Ludcki, Minneapolis, MN, on the brief), for appellant.

John M. Baker, argued, Minneapolis, MN (Clifford M. Greene, on the brief), for appellee.

Before RILEY, RICHARD S. ARNOLD, and SMITH, Circuit Judges.

RICHARD S. ARNOLD, Circuit Judge.

Franklin P. Kottschade, a developer, brought this claim under 42 U.S.C. § 1983 against the City of Rochester, charging that the City had taken his property for public use without just compensation, in violation of the Fifth Amendment. He now appeals from a District Court¹ dismissal for failure to state a claim upon which relief can be granted. Because Mr. Kottschade has not exhausted his state court remedies, as required by current takings jurisprudence, we affirm the District Court's dismissal of his complaint.

In the mid-1990's Mr. Kottschade sought a conditional use permit from the City of Rochester to build a townhouse project on a 16.4 acre parcel of property which he had acquired in 1992. In June of 2000, the City granted him a permit for a townhouse project on part of his property, subject however to nine specific conditions. These conditions included requirements that provisions be made for increased vehicular and pedestrian traffic, storm water management, and dedicated parkland. Mr. Kottschade alleges that the nine conditions, taken together, which were placed on his proposal to build townhouses on the land, were out of proportion to the impact this development of the property would have had on the City of Rochester, and that they rendered the project an economic impossibility, thus in effect taking his property without just compensation.

Mr. Kottschade unsuccessfully appealed both to the city's zoning Board of Appeal and to the city's Common Council to eliminate all of the conditions. He then filed this action challenging the constitutionality of the conditions attached to the permit, and requesting just compensation under the Fifth Amendment. The City of Rochester moved to dismiss, arguing that, under Williamson County Regional Planning Comm'n v. Hamilton Bank of Johnson City, 473 U.S. 172, 105 S.Ct. 3108, 87 L.Ed.2d 126 (1985), Mr. Kottschade could not bring a constitutional takings claim in federal court before obtaining a final decision from the city, and that the suit was wrongly brought in federal court in the first instance since it was not yet ripe, given that state court procedures remained available to the plaintiff.

The District Court dismissed the action, concluding that until Mr. Kottschade sought relief in a state-court inverse-condemnation action and had relief denied, the claim of taking without just compensation was not ripe for decision in a federal court. In this appeal Mr. Kottschade argues that the Supreme Court decisions in Williamson and City of Chicago v. International College of Surgeons, 522 U.S. 156, 118 S.Ct. 523, 139 L.Ed.2d 525 (1997), when read together, permit him to bring a claim for relief under the Fifth Amendment Just Compensation Clause in federal court in these circumstances.

I.

We review a District Court's grant of dismissal under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim de novo. All facts alleged in the complaint are taken as true and construed in the light most favorable to the plaintiff. Coleman v. Watt, 40 F.3d 255, 258 (8th Cir. 1994). A motion to dismiss should not be granted unless the plaintiff can prove no set of facts entitling him to relief. Such is the case here, and so we affirm the District Court's dismissal of the claim. Until Mr. Kottschade has exhausted his state court remedies, his claim may not be brought in federal court.

Mr. Kottschade's constitutional claim is brought under the Just Compensation Clause of the Fifth Amendment, which provides, "[N]or shall private property be taken for public use, without just compensation." Mr. Kottschade argues that dismissal of his claim by the District Court was improper because, despite the Supreme Court's holding in Williamson, the 1997 City of Chicago decision modifies the earlier case in such a way as to permit him to seek a remedy initially in federal court. He asks us to reconcile these two Supreme Court holdings. The plaintiff requests that this Court acknowledge that City of Chicago has modified the requirements laid out in Williamson with respect to procedures plaintiffs must follow in seeking just compensation for takings of property. Under Williamson, a property owner "has not suffered a violation of the Just Compensation Clause until the owner has unsuccessfully attempted to obtain just compensation through the procedures provided by the State for obtaining such compensation." 473 U.S. at 195, 105 S.Ct. 3108. City of Chicago is said to have modified this holding by permitting plaintiffs in takings cases to file claims in federal court first as a matter of course. We have held that these procedures include the filing and prosecution of an action for inverse condemnation in the state courts. McKenzie v. City of White Hall, 112 F.3d 313, 317 (8th Cir.1997); Collier v. City of Springdale, 733 F.2d 1311, 1317 (8th Cir. 1984).

What the plaintiff actually asks is that this Court find that the Supreme Court's decision in City of Chicago overrules Williamson in part, specifically its holding that "[I]f a State provides an adequate procedure for seeking just compensation, the property owner cannot claim a violation of the Just Compensation Clause until it has used the procedure and been denied just compensation." 473 U.S. at 195, 105 S.Ct. 3108. But as the District Court noted, City of Chicago's holding addresses only the question of federal-question jurisdiction over a ripe takings claim. It does not explicitly answer the question of what is necessary to render a takings claim ripe. The Supreme Court has not explicitly overruled or modified the ripeness requirements laid out in Williamson in the context of takings cases. The requirement that all state remedies be exhausted, and the barriers to federal jurisdiction presented by res judicata and collateral estoppel that may follow from this requirement, may be anomalous. Nonetheless Williamson controls the instant case. Compare this perceived gap in Supreme Court jurisprudence with this Court's observations in Commonwealth of Puerto Rico v. Branstad, 787 F.2d 423 (8th Cir.1986). There this Court declined to declare that a Civil War case, Com. of Kentucky v. Dennison, 24 How. 66, 16 L.Ed. 717 (1860), had been implicitly overruled, while registering its view that the holding of the case had been...