WG Woodmere LLC v. Town of Hempstead

• Decision Date: 23 August 2021
• Docket Number: CV 20-3903 (ARR)(AYS)
• Parties: WG WOODMERE LLC, SG BARICK LLC, and LH BARICK, LLC, Plaintiffs, v. TOWN OF HEMPSTEAD, INCORPORATED VILLAGE OF LAWRENCE, and INCORPORATED VILLAGE OF WOODSBURGH Defendants.
• Court: U.S. District Court — Eastern District of New York

WG WOODMERE LLC, SG BARICK LLC, and LH BARICK, LLC, Plaintiffs,
v.
TOWN OF HEMPSTEAD, INCORPORATED VILLAGE OF LAWRENCE, and INCORPORATED VILLAGE OF WOODSBURGH Defendants.

No. CV 20-3903 (ARR)(AYS)

United States District Court, E.D. New York

August 23, 2021

REPORT AND RECOMMENDATION

Anne Y. Shields, United States Magistrate Judge

This is an action commenced by the Plaintiff entities (“Plaintiffs”) alleging violations of federal and state law in connection with the zoning of a parcel of land, located at 99 Meadow Drive, Woodmere New York.^[1] That property, purchased by Plaintiffs in 2017 was formerly home to a golf club. It has been known, and is referred to herein as the “Woodmere Club” or the “Property”. The Woodmere Club consists of 118 acres. It is located within Defendants Town of Hempstead (“Hempstead” or the “Town”), Village of Lawrence (“Lawrence”) and Village of Woodsburgh (“Woodsburgh”) (collectively “Defendants”).

Plaintiffs' complaint (the “Complaint”) alleges seven separate causes of action. See generally Complaint (“Compl.”), Docket Entry (“DE”) [1]. The four Federal claims set forth therein seek redress for Constitutional violations pursuant to 28 U.S.C. 1983 (“Section 1983”).

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The first such claim alleges denial of equal protection of the laws in violation of the Fifth and Fourteenth Amendments to the United States Constitution (the “Equal Protection Claim”). Compl. ¶¶ 308-17. Plaintiffs' second Federal claim alleges an unconstitutional taking in violation of the Fifth Amendment to the Constitution. Compl. ¶¶ 318-34 (the “Takings Claim”). Plaintiffs' third claim also alleges a Fifth Amendment violation. This claim, set forth in paragraphs 335-348 of the Complaint, alleges the “uncompensated exaction of an easement,” on the Property. Compl. ¶ 342 (the “Exaction Claim”). Plaintiffs' final Federal claim alleges violation of both their procedural and substantive due process rights in violation of the Fifth and Fourteenth Amendments to the Constitution. Compl. ¶¶ 349-60. (the “Due Process Claims”). With the exception of the Exaction Claim, the aforementioned Federal Constitutional claims also allege parallel claims under the Constitution of the State of New York. See Compl. ¶ 310 (alleging violation of N.Y. Const. Art. 1 section 11); ¶ 320 (alleging violation of N.Y. Const. Art. 1 Section 7); ¶ 350 (alleging violation of N.Y., Const. Art. 1 Section 6).

In addition to their Federal and State Constitutional claims, Plaintiffs allege three claims under New York State law- the fifth through seventh causes of action. The fifth cause of action alleges broadly that Defendants have exceeded their authority under their zoning powers. Compl. ¶¶ 361-70. Plaintiffs' sixth cause of action alleges a more specific violation of Defendants' zoning power by using it to confer unauthorized landmark status on a particular building located on the Property. Compl. ¶¶ 371-80. Plaintiffs' final state law claim is in the nature of preemption. That claim states that Defendants have adopted local laws in violation of the New York State Environmental Quality Review Act (“SEQRA”) which is alleged to be the sole vehicle for enacting environmental legislation under New York State law. Compl. ¶¶ 381-86.

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Presently before this Court, upon referral of the Honorable Sandra J. Feuerstein,^[2] is Defendants' joint motion to dismiss the Complaint. For the reasons set forth below, the Court respectfully recommends that Defendants' motions be granted in part and denied in part. The Court recommends that the motions to dismiss the SEQRA claims be granted but that the motions be denied with respect to all other claims, and that such claims be allowed to proceed to discovery.

BACKGROUND

I. Factual Background

In the context of this motion to dismiss Plaintiffs rely on the facts set forth in the Complaint. See generally Compl. Defendants, rather than setting forth facts in their memorandum of law (as is the case in nearly every set of papers submitted in connection with motions to dismiss) sought, and were granted leave, to submit a joint statement of facts. That joint statement (“Defendants' Statement”) appears on the docket herein as entry number 35-43. This Court observes that allowing for a joint statement of facts did not necessarily serve judicial economy in that Defendants Hempstead and Woodsburgh filed an initial 45-page memorandum of law and Defendant Village of Lawrence filed its own 25-page memorandum. Plaintiffs, also given leave to exceed usual page limits, jointly respond to all motions with an 83-page memorandum of law.

In any event, the Court has reviewed the factual allegations in the Complaint as well as Defendants' Statement. To the extent that facts in Defendants' Statement mirror those set forth in the Complaint, the statement is considered. However, to the extent, as described variously below, Defendants' Statement sets forth their positions regarding their clients' intent or refers to

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documents outside of the Complaint, the statement is ignored as inappropriate to consider in the context of the present motion to dismiss. This is especially true in light of the fact that while Defendants' motion papers make passing reference to Rule 56 of the Federal Rules of Civil Procedure, it is clear that the present motion was never converted to motion for summary judgment. Therefore, the facts set forth below are drawn from the Complaint and documents annexed thereto. They are accepted as true and construed in favor of Plaintiffs - the non-moving parties.

On July 28, 2021, the Court held oral argument on the motion. The purpose of the argument was to hear counsels' legal argument as well as their positions with regard to Plaintiffs' claims. From time-to-time Plaintiffs' counsel was asked to explain the claims and argue as to whether they were factually supported by the pleading. See generally Transcript of July 28, 2021 Oral Argument (“Arg. Tr.”), DE [48]. Defendants often countered that Plaintiffs' descriptions varied from the Complaint and lacked factual basis therein. See generally id. It is important to note that when determining whether Plaintiffs state a claim as to each particular cause of action, the Court is guided only by the factual allegations actually set forth in the Complaint and the reasonable inferences to be drawn therefrom.

A. The Property

Plaintiffs acquired the Property on April 27, 2017. Compl. ¶¶ 87, 85-86. Approximately 55 acres of the Property are located within Hempstead, 40.5 acres are within Woodsburgh, and 22.9 acres are within Lawrence. Compl. ¶ 88. The Property's location makes it subject to the local zoning controls of each of the Defendant entities, as well as those of the County of Nassau. Compl. ¶ 90. Prior to Plaintiffs' purchase it became clear to its former owners that it could not be operated profitably as a golf club. Therefore, the members of that club resolved to sell the

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Property. Compl. ¶ 93. Plaintiffs purchased the Property for approximately $12 million. As part of the sale Plaintiffs assumed the prior owners' debt and agreed to continue operations as a golf club for a period of time. At the time of the purchase, however, it was Plaintiffs' intent to subdivide the land comprising the club for residential development in accord with local zoning, and consistent with the surrounding neighborhood. Compl. ¶ 97. In furtherance of this goal, and prior to the purchase, Plaintiffs engaged land use counsel as well as engineering and planning experts. It was the opinion of these experts that existing zoning allowed for the Property to be properly and legally developed to include 284 single family homes. Compl. ¶ 100. Specifically, Plaintiffs assumed that 248 lots could be developed in Hempstead, that 12 lots could be developed in Lawrence and that 24 lots could be developed in Woodsburgh. Id.

B. The Building Moratoria

On November 15, 2016 -prior to Defendants' purchase of the Property - the Town of Hempstead adopted a resolution and accompanying zoning ordinance imposing a building moratorium halting all residential development of golf course properties within the Town. Compl. ¶ 102. Plaintiffs' purchase of the Property took place shortly before the moratorium was set to expire. However, the moratorium was extended by the Town six times, through August 7, 2018. Thus, although enacted prior to Plaintiffs' April 2017 acquisition of the Property, the life of the moratorium was extended during and after their purchase. See Compl. ¶ 113.

Like all land use decisions enacted by Defendants, Plaintiffs characterize enactment and extensions of the 2016 building moratorium as part of Defendants' ploy to target Plaintiffs and interfere with their right to develop the Property. Compl. ¶ 108. In particular, Plaintiffs state that the moratoria were “political measures designed to project the Town's sympathies with those members of the public who wished to stop any sort of development of the Property” . . . and

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“were enacted simply to grind any development on the Property to a halt.” Compl. ¶¶ 114-15. Defendants, on the other hand, state that when the initial moratorium was enacted Hempstead was faced with potential development of a high-density residential subdivision (if developed in accord with existing zoning) and with it “the potential irrevocable loss” of “invaluable open space” in an “environmentally sensitive coastal area.” Defs.' Joint Statement of Facts (“Defs.' St.”) at 5,^[3] DE [35-43]. According to Defendants, development of the Woodmere Club in accord with zoning in existence at the time of the initial moratorium would have allowed for development that was inconsistent with the character of the surrounding community. Such development would further take place without consideration of the area's environmentally sensitive coastal ecosystem, rising sea levels, or the mitigation of traffic congestion on overburdened roads. Id.

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