Levy Machining, LLC v. Hanover Twp.

• Decision Date: 19 January 2023
• Docket Number: 21-cv-12566
• Parties: LEVY MACHINING, LLC, RYAN LEVY, ROBERT LEVY, and SHERILENE LEVY, Plaintiffs, v. HANOVER TOWNSHIP and JEFF HEATH, Defendants.
• Court: U.S. District Court — Eastern District of Michigan

LEVY MACHINING, LLC, RYAN LEVY, ROBERT LEVY, and SHERILENE LEVY, Plaintiffs,
v.
HANOVER TOWNSHIP and JEFF HEATH, Defendants.

No. 21-cv-12566

United States District Court, E.D. Michigan, Southern Division

January 19, 2023

OPINION AND ORDER GRANTING DEFENDANTS' MOTION FOR JUDGMENT ON THE PLEADINGS (ECF No. 19) AND DENYING AS MOOT DEFENDANTS' MOTION FOR SUMMARY JUDGMENT (ECF No. 33)

GERSHWIN A. DRAIN UNITED STATES DISTRICT JUDGE

I. Introduction

Plaintiff Levy Machining, LLC (“Levy Machining”) as well as Plaintiffs Ryan Levy, Robert Levy, and Sherilene Levy (collectively the “Levy Family”) initiated the instant action against Defendants Hanover Township (the “Township”) and Jeff Heath on November 11, 2021. ECF No. 1. Plaintiffs allege that Defendants selectively enforced zoning ordinances against them in retaliation for personal disputes between Defendant Heath and the Levy Family. See generally id.

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Presently before the Court is Defendants' Motion for Judgment on the Pleadings Pursuant to Fed.R.Civ.P. 12(c). The motion is fully briefed, and the Court held a hearing on the matter on December 5, 2022. Also before the Court is Defendants' Motion for Summary Judgment (ECF No. 33), which is also fully briefed. For the following reasons the Court GRANTS Defendants' Motion for Judgment on the Pleadings Pursuant to Fed.R.Civ.P. 12(c) (ECF No. 19) and DENIES AS MOOT Defendants' Motion for Summary Judgment (ECF No. 33).

II. Background

A. Factual Background

Plaintiffs Ryan, Robert, and Sherilene Levy operate co-Plaintiff Levy Machining, a machine fabrication business. ECF No. 1, PageID.3; ECF No. 19, PageID.114. At all times relevant to this lawsuit, the Levy Family operated Levy Machining on property zoned AG-1 within Defendant Hanover Township. ECF No. 1, PageID.3. Plaintiff Sherilene Levy also lived at the property with her husband, Non-Party Michael Levy. Id.

The property is adjacent to a parcel owned by Defendant Heath. Id. at PageID.4. Plaintiffs claim that Heath and Michael Levy have had a difficult fortyyear relationship that has occasionally devolved into screaming matches. Id. Their

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prior disputes concerned driveway use and Heath filing formal complaints accusing Levy Machining of illegal dumping. Id. at PageID.5.

Plaintiffs allege that from 2002 to 2018, Levy Machining “operated without a single issue.” Id. at PageID.3. Specifically, they allege that Defendant Hanover Township did not enforce its zoning ordinance throughout the municipality except for locations with “property line setback issues.” Id. They further claim that Township Supervisor John Tallis and Township Attorney Bob Flack informed Michael Levy it was unnecessary for him to procure a conditional use and/or variance permit. Id.

However, in 2018, Defendant Heath ran for Township Supervisor. Id. at PageID.4. On April 15, 2019, within three days of Heath's election and after he was appointed Zoning Administrator, Plaintiffs were given a notice to cure their ordinance violations by September 30, 2019. Id. at PageID.4-5. Specifically they were accused of “[o]perating a [b]usiness in an AG-1 Zoning District, in violation of Ordinance 4.1.1,” [l]ack of site plan approval submitted to the township, in violation of Ordinance 5.6,” [l]ack of Zoning Compliance Permit, in violation of [O]rdinance 6.4.1,” “[l]ack of Certificate of Occupancy, in violation of [O]rdinance 6.5.1” and “[s]toring [m]aterials [o]utdoors, in violation of [O]rdinance 5.9.” Id. at PageID.5. Plaintiffs also received Michigan Department of Environmental Quality

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letters signed by Heath that accused them of illegal dumping.^[1] Id. Despite the deadline indicate in the notice letter, Defendant Hanover Township initiated zoning enforcement proceedings in the Jackson County Circuit Court on August 23, 2019. Id. at PageID.4.

Plaintiffs were ordered to relocate Levy Machining and did so. Id. Plaintiffs allege that they incurred significant costs to relocate Levy Machining's operations and that they are now forced to pay “a sizable rental obligation each month.” Id. They also claim to have lost several contracts due to the enforcement actions. Id. Nevertheless, Plaintiffs contend that “approximately twenty (20) similarly situated businesses that operate companies out of the same zoning district in Hanover Twp. [] have never once had a zoning enforcement proceeding initiated against them.” Id. at PageID.5.

As a result, Plaintiffs allege that Defendant Heath's motive for running for Township Supervisor was to initiate zoning enforcement proceedings against them. Id. at PageID.4. Plaintiffs also claim that several conflicts of interest resulted in the selective enforcement of the zoning ordinances against them. Id. at PageID.6. First, Defendant Heath is employed by Lomar Machine (“Lomar”), a direct competitor to

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Levy Machining. Id. at PageID.5. Second, Defendant Heath's daughter-in-law, Rachel Heath is a Trustee for Defendant Hanover Township. Id. at PageID.6. Third, Defendant Heath's son, Taylor Heath, is employed by LeMatic, Inc. a client over which Levy Machining and Lomar compete. Id. Plaintiffs claim that Taylor Heath channeled business to Lomar while Levy Machining's operations were disrupted by the zoning issues. Id. Finally, Jason Dorian, another Trustee for Defendant Hanover Township, is a Lomar employee and is married to the daughter of Lomar's CEO. Id.

B. Procedural Background

Plaintiffs bring claims under 42 U.S.C. § 1983 for violations of their rights to equal protection (Count I), substantive due process (Count II), and procedural due process (Count III) as well as under 42 U.S.C. § 1985 for conspiracy to interfere with their civil rights (Count IV). ECF No. 1, PageID.6-12. Plaintiffs also bring state law claims for tortious interference (Count V), defamation (Count VI), intrusion on seclusion (Count VII), and civil conspiracy (Count VIII). Id. at PageID.12-16.

Defendants answered the Complaint. ECF Nos. 12, 13. They subsequently filed the instant Motion for Judgment on the Pleadings Pursuant to Fed.R.Civ.P. 12(c). ECF No. 19. In their motion, Defendants argue that Plaintiffs' claims fail as a matter of law under the doctrine of res judicata because all of them were, or could

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have been, decided in Hanover Twp. v. Levy Machining, LLC, No. 19-3508-CZ (Mich. 4th Cir. Ct. 2019) (the “state court matter”), which resulted in a final judgment on the merits in favor of the Township and against Plaintiffs and their privies. ECF No. 19, PageID.107. Defendants further contend that Plaintiffs' claim for conspiracy to interfere with civil rights (Count IV) fails as a matter of law because Plaintiffs failed to plead discrimination based on race or membership in a class of discrete and insular minorities. Id.

Plaintiffs counter that res judicata does not apply as the parties in the instant matter are dissimilar to those in the state court matter. ECF No. 22, PageID.319. Specifically, they assert that Defendant Heath and Plaintiffs Ryan and Robert Levy were not parties to the state court matter and that Ryan and Robert Levy have brought several claims as individuals, not merely on behalf of Levy Machining. Id. Additionally, Plaintiffs argue that they could not have brought their claims as counterclaims in the state court matter. Id.

III. Law & Analysis

A. Legal Standard

The Court analyzes a motion for judgment on the pleadings under Federal Rule of Civil Procedure 12(c) (“Rule 12(c)”) using the same standard it would employ for a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). Fla.

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Power Corp. v. FirstEnergy Corp., 810 F.3d 996, 999 (6th Cir. 2015). “[A]ll well-pleaded material allegations of the pleadings of the opposing party must be taken as true.” Tucker v. Middleburg-Legacy Place, 539 F.3d 545, 549 (6th Cir. 2008) (citation omitted). However, the court “need not accept as true legal conclusions or unwarranted factual inferences.” JPMorgan Chase Bank, N.A. v. Winget, 510 F.3d 577, 581-82 (6th Cir. 2007) (citation omitted). To survive a motion for judgment on the pleadings, “[t]he factual allegations in the complaint need to be sufficient to give notice to the defendant as to what claims are alleged, and the plaintiff must plead ‘sufficient factual matter' to render the legal claim plausible, i.e., more than merely possible.” Fritz v. Charter Twp. of Comstock, 592 F.3d 718, 722 (6th Cir. 2010) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “[T]he motion may be granted only if the moving party is nevertheless clearly entitled to judgment.” Winget, 510 F.3d at 581 (citation omitted).

When resolving a motion for judgment on the pleadings, a Court may consider a document that “is referred to in the pleadings and integral to the claims” and “public records” without converting the motion into one for summary judgment. Com. Money Ctr., Inc. v. Illinois Union Ins. Co., 508 F.3d 327, 335 (6th Cir. 2007) (citation omitted); Kostrzewa v. City of Troy, 247 F.3d 633, 644 (6th Cir. 2001).

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B. Discussion

1. Subject Matter Jurisdiction

As a threshold matter, in their Reply, Defendants “suggest[] this Court lacks subject matter jurisdiction over Plaintiffs' entire Complaint under the Rooker-Feldman doctrine.” ECF No. 24, PageID.429. The Court disagrees.

As the Sixth Circuit has explained:

The Supreme Court is vested with exclusive jurisdiction over appeals from final state-court judgments. Lance v. Dennis, 546 U.S. 459, 126 S.Ct. 1198, 1200, 163 L.Ed.2d 1059 (2006). Thus, “[t]he Rooker- Feldman[ ]doctrine prevents the lower federal courts from exercising jurisdiction over cases brought by ‘state-court losers' challenging ‘state-court judgments rendered before the district court proceedings commenced.'” Id. at 1199 (quoting Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284, 125 S.Ct. 1517, 161 L.Ed.2d 454 (2005)). The doctrine applies “only

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