New West v. City of Joliet

• Decision Date: 31 January 2012
• Docket Number: 11 C 5305,05 C 1743,07 C 7214
• Parties: NEW WEST, et al. Plaintiffs, v. CITY OF JOLIET, et al. Defendants. THERESA DAVIS, et al. Plaintiffs. v. CITY OF JOLIET, et al. Defendants. UNITED STATES OF AMERICA Plaintiff, v. CITY OF JOLIET, et al. Defendants.
• Court: U.S. District Court — Northern District of Illinois

NEW WEST, et al. Plaintiffs, v. CITY OF JOLIET, et al. Defendants.

THERESA DAVIS, et al. Plaintiffs. v. CITY OF JOLIET, et al. Defendants.

UNITED STATES OF AMERICA Plaintiff, v. CITY OF JOLIET, et al. Defendants.

05 C 1743

07 C 7214

11 C 5305

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

Dated: January 31, 2012

Hon. Charles R. Norgle

OPINION AND ORDER

Before the court are three motions by the City of Joliet ("Joliet") to stay suits by plaintiffs in three separate but related civil rights suits which spring from a contested condemnation action. For the following reasons, Joliet's motions to stay are granted.The three civil rights suits are stayed pending the completion of a bench trial in the condemnation case.

I. BACKGROUND

The factual background of these cases is well documented in previous opinions by this court and by the Seventh Circuit.¹ This court has issued a separate opinion and order granting in part and denying in part Joliet's motions to dismiss. This opinion and order concerns whether the plaintiffs' Seventh Amendment right to a jury trial in their civil rights suits would be violated by first conducting a bench trial in the condemnation action. In 2007, with just New West's civil rights suit facing Joliet as it pressed its condemnation case, the Seventh Circuit instructed: "The district court's first order of business on remand should be to resolve the condemnation action. If Joliet prevails, that would knock out many of the theories on which New West relies in this suit. . . ." New West. L.P. v. City of Joliet, 491 F.3d 717, 721 (7th Cir. 2007). By 2009, there were two civil rights lawsuits facing Joliet, one by New West, another by tenants of Evergreen Terrace ("Tenants").² The Seventh Circuit reiterated instructions to resolve the condemnation action first, City of Joliet v. New West. L.P., 562 F.3d 830, 832 (7th Cir. 2009), adding: "This eminent domain proceeding has been stalled since its institutionmore than three years ago. We trust that the district court will now bring it to a speedy conclusion," id. at 839.

Three more years have passed. This court called for briefing on the issue of whether the four suits, already consolidated for discovery, should be consolidated for trial. The plaintiffs favor consolidating all four suits for trial.³ They contend a bench trial in the condemnation action would foreclose their Seventh Amendment right to a jury trial because their condemnation action defenses—such as alleged Fair Housing Act ("FHA") violations—mirror their FHA claims for damages in the civil rights cases. Joliet opposes consolidation for trial. New West and the Tenants have found occasion to argue the Seventh Amendment issue in other briefing, including Joliet's latest motions to dismiss. The court has considered these arguments and the Seventh Circuit's repeated instructions. The court notes at the outset that a Seventh Amendment question was never before the Seventh Circuit in this case. But it is noteworthy that the panel in both decisions discussed the presence of the multiple lawsuits when issuing the directive to resolve the condemnation action first, recognizing that doing so may preclude issues in the related civil rights cases.

II. DISCUSSION

A. Standard of Decision

"The right to a jury trial in federal court hinges on federal procedural law." Dexia Credit Local v. Rogan, 629 F.3d 612, 625 (7th Cir. 2010) (citing Int'l Fin. Servs. Corp. v. Chromas Techs. Canada. Inc., 356 F.3d 731, 735 (7th Cir. 2004)). Federal Rule of Civil Procedure 3 8(a) preserves to parties the right of a trial by jury as declared by the SeventhAmendment to the Constitution or as otherwise provided by federal statute. The Seventh Amendment provides that "[i]n Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved." U.S. Const, amend. VII. To determine if a case would resolve legal rights and give rise to a jury trial right, the court examines both the nature of the claim for relief and the remedy sought. Dexia Credit Local, 629 F.3d at 625 (citing Marseilles Hydro Power. LLC v. Marseilles Land & Water Co., 299 F.3d 643, 648 (7th Cir. 2002)). This analysis requires the court to "compare the . . . action to 18th-century actions brought in the courts of England prior to the merger of the courts of law and equity . . . [and] the remedy sought and determine whether it is legal or equitable in nature." Tull v. United States, 481 U.S. 412, 417-18 (1987). "The abstruse historical search for the nearest 18th-century analog is less important than determining whether the remedy sought is equitable or legal in nature." Dexia Credit Local, 629 F.3d at 625 (internal citations and quotations omitted) (citing Tull, 481 U.S. at 421; Granfinanciera S.A. v. Nordberg, 492 U.S. 33, 42 (1989); Marseilles, 299 F.3d at 648).

"Legal remedies traditionally involve money damages, while equitable remedies are typically coercive and enforceable directly on the persons or things to which they are directed." Dexia Credit Local, 629 F.3d at 625 (citing Int'l Fin., 356 F.3d at 736). "A suit seeking only equitable relief is not a suit at common law, regardless of the nature of the issues likely or even certain to arise in the case." Id (quotations omitted). But when both legal and equitable claims are present in the same suit, the jury right prevails. See Beacon Theatres. Inc. v. Westover, 359 U.S. 500, 510-11 (1959) (holding that a jury right attached to an initially equitable case when the legal issue arose later in a counterclaim); see also Dairy Queen. Inc. v. Wood, 369 U.S. 469, 472-73 (1962) (reaffirming that"where both legal and equitable issues are presented in a single case" a Seventh Amendment jury right exists); Ross v. Bernhardt, 396 U.S. 531, 538 (1970) ("The Seventh Amendment question depends on the nature of the issue to be tried rather than the character of the overall action.").

B. Motion to Stay and Jury Trial Right

Joliet argues the three civil rights suits should be stayed because they are duplicative of defenses in the condemnation case or, alternatively, because there is no case or controversy. The argument to stay for lack of a case or controversy is frivolous: without a case or controversy this court lacks jurisdiction and there is nothing to stay. The argument to stay on grounds of duplicative litigation is also off the mark, but Joliet manages to invoke the Seventh Circuit's directive to take the condemnation proceeding first. "That the condemnation action is pending in federal court suggests that it is imprudent to resolve the current suit until the condemnation proceeding has been finally resolved; why deal with a defense independent of the action to which it pertains?" New West, 491 F.3d at 720. Although this court is obliged to follow the instructions of the Seventh Circuit in this case, in the past three years parties and paper have intervened. Moreover, the panel never got a chance to consider the Seventh Amendment issue. This court therefore will follow the panel's instructions to the extent they are consistent with the Seventh Amendment rights of the plaintiffs.

1. Whether Beacon Theatres v. Westover and Its Progeny Control

There is no dispute that the nature of the plaintiffs' claims is legal, and that the civil rights cases, standing alone, would have jury trials while the condemnation case, standing alone, would not. The traditional two-step Seventh Amendment inquiry is unnecessary. Rather, the Tenants and New West raise the issue controlled by BeaconTheatres and Dairy Queen, The plaintiffs point out that equitable defenses in the condemnation action are for the most part identical to the legal claims in the civil rights suits. As a result, preclusion of legal issues seems inevitable if the condemnation proceeds separately with a bench trial, depriving the plaintiffs of a jury determination. See, e.g., Mann v. Brenner, 375 F. App'x 232, 237-38 (3d Cir. 2010) (applying collateral estoppel where the "record makes clear that the identical issue [the landowner] seeks to raise [in a § 1983 action] . . . was actually litigated in the state condemnation proceeding").⁴ The plaintiffs argue that because both legal and equitable claims are present among the four cases, Beacon Theatres and Dairy Queen require a jury trial on all legal issues located among the four cases—in particular, the affirmative defenses in the condemnation case that involve the same issues and facts as the legal claims in the civil rights suits.

Plaintiffs overlook the fact that this doctrine applies when the legal and equitable claims are present in the same action. Beacon Theatres, 359 U.S. at 510 (applying to "joinder in one suit of legal and equitable causes"); Dairy Queen, 369 U.S. at 472 (applying "where both legal and equitable issues are presented in a single case"); Ross. 396 U.S. at 537-38 (applying "where equitable and legal claims are joined in the same action"); see also Curtis v. Loether, 415 U.S. 189, 195 (1974) (applying to "an ordinary civil action") (all emphases added). Plaintiffs filed no counterclaims in the condemnation action. Indeed, the prevailing view bars counterclaims in condemnation suits. See Fed. R. Civ. P. 71.1(e) (expressly allowing defenses and objections in answer); United States v. 191.07 Acres of Land, 482 F.3d 1132,1140 (9th Cir. 2007) ("A property owner cannot file a counterclaim in a direct condemnation action."); United States v. Certain LandSituated in City of Detroit, 361 F.3d 305, 308 (6th Cir. 2004) (permitting no counterclaim in direct taking); United States v. Banisadr Bldg, Joint Venture, 65 F.3d 374, 380 (4th Cir. 1995) (noting that "a counterclaim, which would otherwise seem to be an appropriate vehicle for raising a claim" in condemnation action must be filed in a separate action) (internal quotations omitted); see also 12 Charles Alan Wright & Arthur R. Miller, Federal Practice and...