Nernberg v. Borough of Sharpsburg

• Decision Date: 28 June 2016
• Docket Number: Civil Case No. 14-931
• Parties: MAURICE A. NERNBERG and NANCY NERNBERG, Plaintiffs, v. BOROUGH OF SHARPSBURG, PENNSYLVANIA, Defendant.
• Court: U.S. District Court — Western District of Pennsylvania

MAURICE A. NERNBERG and NANCY NERNBERG, Plaintiffs, v. BOROUGH OF SHARPSBURG, PENNSYLVANIA, Defendant.

Civil Case No. 14-931

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA

June 28, 2016

MEMORANDUM OPINION

CONTI, Chief District Judge.

I. INTRODUCTION

Pending before the court is the October 16, 2015, motion for summary judgment (ECF No. 45) filed by the Borough of Sharpsburg, Pennsylvania ("defendant" or "Borough"), pursuant to Federal Rule of Civil Procedure 56(a). Defendant seeks judgment as a matter of law with respect to all remaining claims¹ contained in the November 7, 2014, amended complaint (ECF No. 23) filed by Maurice A. Nernberg and Nancy Nernberg ("plaintiffs"). In their amended complaint, plaintiffs claim that Borough Ordinance No. 13-08 ("Ordinance No. 13-08") is violative of the Constitution of the United States and the Constitution of Pennsylvania, as well as relevant provisions of the Fair Housing Act, 42 U.S.C. §§ 3601 - 3631 ("FHA"), and Pennsylvania Human Relations Act, 43 Pa. Stat. §§ 951 - 963 ("PHRA"). This court exercises subject-matter jurisdiction over plaintiffs' federal claims pursuant to 28 U.S.C. § 1331 (federalquestion jurisdiction), and over plaintiffs' state claims pursuant to 28 U.S.C. § 1367(a) (supplemental jurisdiction). For the reasons that follow, defendant's motion will be denied.

II. FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs are the owners of residential and commercial rental properties located within the Borough. (ECF No. 23 ¶ 3). Plaintiffs do not occupy these properties for residential or business purposes. (Id.). On or about October 1, 2013, the Borough adopted Ordinance No. 13-08. (ECF Nos. 50 ¶ 1; 55 ¶ 1). Ordinance No. 13-08 established that landlords - such as plaintiffs - must maintain a license to rent property in the Borough, and that the license must be renewed every two years. (ECF No. 50-4 at 6). The license requires payment of a biannual license and inspection fee to the Borough. (Id.). The Borough set the license fee at $60.00. (ECF No. 50-8 at 1). Ordinance No. 13-08 also established that plaintiffs could not permit more than one person per 150 square feet of living space to reside in a rental unit. (ECF No. 50-4 at 5).

The Borough began receiving payment of the new biannual license fees from property owners as early as October 2013. (ECF Nos. 50-3; 50-6 at 5). However, rental property inspections and the issuance of licenses pursuant to No. 13-08 did not begin until January 2014. (ECF Nos. 46-4 at 64; 50 ¶ 15; 50-7 at 7; 55 ¶ 15). At that time, Lou Deluca was hired by the Borough to act as the Code Enforcement Officer for inspections conducted in accordance with Ordinance No. 13-08. (ECF Nos. 46-4 at 8; 50-9 at 6). Mr. Deluca is the only Borough employee who conducts rental property inspections. (ECF No. 50-6 at 4). The Borough Utility Administrator, Barbara Ruhle, is responsible for administering the licensing program and issuing licenses. (ECF Nos. 50-6 at 3; 50-7 at 6; 50-9 at 6).

On June 17, 2014, plaintiffs filed a complaint against the Borough in the Court of Common Pleas of Allegheny County, Pennsylvania. (ECF No. 1-1 at 1 - 11). On July 11, 2014, the Borough removed plaintiffs' action to this court. (ECF No. 1). Plaintiffs filed an amended complaint (ECF No. 23) in this court on November 7, 2014. Following a March 2, 2015, hearing on the Borough's motion to dismiss the amended complaint, the court dismissed all but Counts I (disguised tax provision) and III (discriminatory tenancy restriction). (ECF No. 38). On May 7, 2015, the Borough replaced Ordinance No. 13-08 with new Ordinance No. 15-06 ("Ordinance No. 15-06"). (ECF Nos. 46 ¶ 15; 49 ¶ 15; 50-5). Ordinance No. 15-06 materially differs from Ordinance No. 13-08 with respect to the elimination of the restriction upon the number of people permitted to rent a property based upon the property's square footage. (ECF Nos. 50-4 at 5; 50-5 at 9).

On October 16, 2015, the Borough filed the present motion for summary judgment. (ECF No. 45). Plaintiffs filed their opposition on November 16, 2015. (ECF No. 48). The issues are fully briefed. (ECF Nos. 46 - 50, 52, 55 - 56). The time for filing responses being closed, the matter is ripe for disposition.²

III. STANDARD OF REVIEW

Summary judgment is appropriate if the record shows that there is no genuine dispute with respect to any material fact and the movant is entitled to judgment as a matter of law. FED. R. CIV. P. 56(a). The mere existence of a factual dispute, however, will not necessarily defeat a motion for summary judgment. Only a dispute over a material fact—that is, a fact that would affect the outcome of the suit under the governing substantive law—will preclude the entry ofsummary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Even then, the dispute over the material fact must be genuine, such that a reasonable jury could resolve it in the nonmoving party's favor. Id. at 248-49.

In deciding a summary judgment motion, a court must view the facts in the light most favorable to the nonmoving party and must draw all reasonable inferences, and resolve all doubts, in favor of the nonmoving party. Liberty Lobby, 477 U.S. at 255; Wishkin v. Potter, 476 F.3d 180, 184 (3d Cir.2007); Doe v. Cnty. of Centre, Pa, 242 F.3d 437, 446 (3d Cir.2001); Woodside v. Sch. Dist. of Phila. Bd. of Educ., 248 F.3d 129, 130 (3d Cir.2001); Heller v. Shaw Indus., Inc., 167 F.3d 146, 151 (3d Cir.1999). A court must not engage in credibility determinations at the summary judgment stage. Simpson v. Kay Jewelers, Div. of Sterling, Inc., 142 F.3d 639, 643 n. 3 (3d Cir.1998).

One of the principal purposes of summary judgment is to isolate and dispose of factually unsupported claims or defenses. Celotex Corp. v. Catrett, 477 U.S. 317, 323 - 24 (1986). The summary judgment inquiry asks whether there is a need for trial - "whether, in other words, there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Liberty Lobby, 477 U.S. at 250. In ruling on a motion for summary judgment, the court's function is not to weigh the evidence or to determine the truth of the matter, but only to determine whether the evidence of record is such that a reasonable jury could return a verdict for the nonmoving party. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150-51 (2000) (citing decisions); Liberty Lobby, 477 U.S. at 248 - 49.

The burden of showing that no genuine issue of material fact exists rests initially on the party moving for summary judgment. Celotex, 477 U.S. at 323; Aman v. Cort Furniture RentalCorp., 85 F.3d 1074, 1080 (3d Cir.1996). The moving party may satisfy its burden either by producing evidence showing the absence of a genuine issue of material fact or by demonstrating that there is an absence of evidence to support the nonmoving party's case. Marten v. Godwin, 499 F.3d 290, 295 (3d Cir. 2007) (citing Celotex, 477 U.S. at 325). A defendant who moves for summary judgment is not required to refute every essential element of the plaintiff's claim; rather, the defendant must only point out the absence or insufficiency of plaintiff's evidence offered in support of one or more of those elements. Celotex, 477 U.S. at 322 - 23. Once the movant meets that burden, the burden shifts to the nonmoving party to "set forth specific facts showing that there is a genuine issue for trial" and to present sufficient evidence demonstrating that there is indeed a genuine and material factual dispute for a jury to decide. FED. R. CIV. P. 56(e); see Liberty Lobby, 477 U.S. at 247 - 48; Celotex, 477 U.S. at 323 - 25. If the evidence the nonmovant produces is "merely colorable, or is not significantly probative," the moving party is entitled to judgment as a matter of law. Liberty Lobby, 477 U.S. at 249.

The nonmoving party must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). To survive summary judgment, the nonmoving party must "make a showing sufficient to establish the existence of [every] element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322. Furthermore, "[w]hen opposing summary judgment, the non-movant may not rest upon mere allegations, but rather must 'identify those facts of record which would contradict the facts identified by the movant.' " Corliss v. Varner, 247 F.App'x 353, 354 (3d Cir.2007) (quoting Port Auth. of N.Y. and N.J. v. Affiliated FM Ins. Co., 311 F.3d 226, 233 (3d Cir.2002)).

IV. DISCUSSION

A. Count I

In Count I of plaintiffs' amended complaint, it is asserted that Ordinance No. 13-08³ is a disguised tax provision in violation of the Pennsylvania Constitution, which states in pertinent part that "[a]ll taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws." Pa. Const. art. VIII, § 1. "[M]unicipalities, under the guise of a police regulation, cannot impose a revenue tax." Borough of Kittanning v. Am. Natural Gas. Co., 86 A. 717, 717 (Pa. 1913). Plaintiffs contend that the ordinances at issue violate these principles because the licensing fees charged by the Borough are grossly disproportionate to the cost to the Borough of implementation of the ordinances. (ECF Nos. 23 at 7; 48 at 4 - 10). The Borough counters that it is entitled to summary judgment on this issue because the facts of record indicate that the licensing fees were reasonably commensurate with the cost of administering the licensing program. (ECF Nos. 47 at 4 - 11; 52 at 1 - 6).

It is well established that the power to tax is the sole province of the state General Assembly under the Pennsylvania Constitution, and in the absence of an explicit delegation...