Signed April 13, 2007--Memorandum Opinion by Judge Andre M. Davis.
The Equal Rights Center ("ERC") is a Washington, D.C.-based non-profit organization having approximately 150 individual members, many with disabilities. ERC's mission, inter alia, is to protect the rights of persons with disabilities through education, counseling, advocacy, enforcement, and referral services. ERC instituted this action for injunctive and declaratory relief, and damages, against Equity Residential, a real estate investment trust organized under the laws of Maryland (which describes itself as one of the largest owners [of apartment buildings] in the U.S.) and ERC Operating Limited Partnership, an Illinois limited partnership owned and controlled by Equity Residential (collectively, "Equity").
The first claim by ERC falls under the Fair Housing Act ("FHA"). The gravamen of this claim is that Equity engaged in a pattern and practice of violating the FHA in that they repeatedly and continually failed to design and construct properties subject to prescriptions of the FHA, i.e., multi-family properties containing the minimum number of units and relevant features so as to render the properties accessible to persons with disabilities. The second claim sues under the Americans with Disabilities Act ("ADA"), contending that the properties at issue do not contain, in areas comprising "public accommodations," e.g., leasing offices, parking lots, sidewalks, and restrooms, certain features of minimum accessibility and adaptable design as required by law.
Equity responded with a Rule 12(b)(6) motion to dismiss for lack of subject matter jurisdiction and for improper venue. Equity sought, in the alternative, a severance of what they asserted were multiple claims and a transfer of venue of such severed claims to the numerous districts where the challegened properties are located. Reasoning that the purpose of Rule 12(b)(6) is to test a sufficiency of a complaint and not to resolve contests regarding facts, the merits of a claim, or the applicability of defenses, the Court denied Equity's motion.
A Rule 12(b)(6) motion should not be granted unless it appears beyond doubt that the plaintiff can prove no set of facts in support of the claim which would entitled plaintiff to relief, viewed in the light most favorable to the plaintiff. The Court's first consideration was standing. To establish Article III standing, a plaintiff must allege facts which demonstrate: (1) the existence of a "concrete and particularized" injury-in-fact; (2) a causal connection between the injury suffered and the conduct complained of; and (3) that a favorable adjudication would redress the alleged injury. Fundamentally, it is a pleading burden, although the court must be satisfied at all times that the requirement is met. Organizational standing under the FHA exists to the limits of constitutional "case or controversy" limits; prudential considerations play no role. Thus, to allege a redressable injury-in-fact caused by Equity under the FHA, ERC need only allege facts that demonstrate that the Equity's actions either have caused the organization to divert resources to identify and counteract the defendants' unlawful practices or that the challenged actions have frustrated ERC's mission, which allegation ERC made.
Nonetheless, Equity challenged standing, relying on the contentions that (1) ERC's mission is too generalized for ERC to suffer a cognizable injury; (2) as a matter of law, ERC does not and cannot suffer a cognizable injury outside of the greater Washington area; and (3) ERC will not be entitled to relief on a nationwide basis. The Court found all three contentions unpursuasive.
Finally, Equity sought to have the court slice and dice ERC's two legal claims into 300 separate claims (one for each property) and, thereafter, transfer each claim to the federal district in which that property is located. The Court found to do so would not only be inappropriate but would unnecessarily create a litigation nightmare. Courts have recognized a presumption in favor of the nonmoving party that all claims in a case will be resolved in a single trial and not be severed, placing the burden on the party moving for severance to show that: (1) it will be severely prejudiced without a separate trial; and (2) the issue to be severed is so distinct and separable from the others that a trial of that issue alone may proceed without injustice. In determining whether severance is proper, courts consider: (1) whether the issues sought to be tried separately are significantly different from one another; (2) whether the separable issues require different witnesses and different documentary proof; (3) whether the party opposing severance will be prejudiced if it is granted; and (4) whether the party requesting severance will be prejudiced if the claims are not severed.
As the circumstances in the instant case weighed heavily against severance and transfer, Equity's motion was denied.
The full opinion is available in PDF.
Showing posts with label standing. Show all posts
Showing posts with label standing. Show all posts
Friday, May 4, 2007
Tuesday, January 23, 2007
AES Sparrows Point LNG, LLC v. Smith (Maryland U.S.D.C.)
Decided January 23, 2007--Opinion by Judge Richard D. Bennett.
The Plaintiffs sought a declaration that an amendment to section 256.4 of the Baltimore County Zoning Regulations, as set forth in Bill 71-06 ("the Zoning Amendment") and providing for absolute prohibitions and limitations on the siting of liquified natural gas ("LNG") importation facilities, is preempted under the Supremacy Clause of the United States Constitution1 by the Natural Gas Act, 15 U.S.C. §§717, et seq. ("NGA" or "the Act"), as amended by the Energy Policy Act of 2005, Pub. L. No. 109-58, §311, 119 Stat. 594, 685 (2005). The Plaintiffs filed a Motion for Summary Judgment and the Defendants filed a Motion to Dismiss.
Held:
1. The Defendants invoke the variation on the well-pleaded complaint rule to argue that Plaintiffs' preemption claim is insufficient to support federal subject matter jurisdiction. In making this argument, Defendants relied on the "complete preemption" exception to the well-pleaded complaint rule. That exception permits a plaintiff to "invoke federal subject matter jurisdiction to obtain a declaratory judgment that a state law requirement or prohibition is preempted, notwithstanding the defensive nature of the preemption contention. . . ." Fleet Bank v. Burke, 160 F.3d 883, 886 (2d Cir. 1998), cert. denied, 527 U.S. 1004 (1999). Defendants maintain that this Court lacks subject matter jurisdiction over the instant matter because there is simply no basis for applying the doctrine of complete preemption in the "hypothetical wellpleaded complaint" presented by this case.
The Court found that the Defendants' argument failed because the Plaintiffs requested injunctive relief. Because the Complaint requests both declaratory and injunctive relief, this case is within the purview of Shaw v. Delta Air Lines, Inc and Verizon Maryland, Inc. v. Public Service Commission.
2. Defendants argued that this matter was not ripe for judicial review, because, until approval to build the proposed liquefied natural gas plant is received, the relation between the local zoning ordinance and the federal statute at issue remains "what is in reality an abstract question of law." The Court concluded, however, that any efforts for authorization by the FERC would be futile if the County can simply execute a veto by local zoning legislation. Delaying resolution of the preemption issued in this case, moreover, would frustrate one of the purposes of the recent amendments to the Natural Gas Act, i.e., clarifying the respective roles played by FERC and the states in the administrative process. In sum, there is no need to withhold court consideration under such circumstances.
3. The Plaintiffs have sufficiently established that they have standing.The injury to the Plaintiffs is "certainly impending" in that any efforts for FERC approval is futile if the Baltimore County Council can exercise veto power by the subject Zoning Amendment.
4. The text, context, and legislative history of the Natural Gas Act ("NGA") clearly reflect the intent of the United States Congress to preempt local governments with respect to the siting of liquefied natural gas ("LNG") facilities.
5. Apart from the express preemption, in the alternative, the Court found that the Zoning Amendment is preempted because Congress intended for the NGA and its regulations to occupy the entire field of LNG regulation.
6. The Court also found that the Zoning Amendment is in direct conflict with the NGA and is therefore preempted (i.e., "conflict preemption").
7. The Court found that there are no circumstances under which the Zoning Amendment could be constitutionally valid. Thus, the U.S. v. Salerno standard is satisfied and the Zoning Amendment is facially unconstitutional.
Conclusion:
The amendment to section 256.4 of the Baltimore County Zoning Regulations enacted pursuant to Baltimore County Bill 71-06 is unenforceable because it is preempted under the Supremacy Clause of the United States Constitution by the Natural Gas Act, as amended by the Energy Policy Act of 2005 and the Defendants are enjoined from enforcing the Zoning Amendment.
The opinion is available in PDF. The Order and Judgment may be found here.
The Plaintiffs sought a declaration that an amendment to section 256.4 of the Baltimore County Zoning Regulations, as set forth in Bill 71-06 ("the Zoning Amendment") and providing for absolute prohibitions and limitations on the siting of liquified natural gas ("LNG") importation facilities, is preempted under the Supremacy Clause of the United States Constitution1 by the Natural Gas Act, 15 U.S.C. §§717, et seq. ("NGA" or "the Act"), as amended by the Energy Policy Act of 2005, Pub. L. No. 109-58, §311, 119 Stat. 594, 685 (2005). The Plaintiffs filed a Motion for Summary Judgment and the Defendants filed a Motion to Dismiss.
Held:
1. The Defendants invoke the variation on the well-pleaded complaint rule to argue that Plaintiffs' preemption claim is insufficient to support federal subject matter jurisdiction. In making this argument, Defendants relied on the "complete preemption" exception to the well-pleaded complaint rule. That exception permits a plaintiff to "invoke federal subject matter jurisdiction to obtain a declaratory judgment that a state law requirement or prohibition is preempted, notwithstanding the defensive nature of the preemption contention. . . ." Fleet Bank v. Burke, 160 F.3d 883, 886 (2d Cir. 1998), cert. denied, 527 U.S. 1004 (1999). Defendants maintain that this Court lacks subject matter jurisdiction over the instant matter because there is simply no basis for applying the doctrine of complete preemption in the "hypothetical wellpleaded complaint" presented by this case.
The Court found that the Defendants' argument failed because the Plaintiffs requested injunctive relief. Because the Complaint requests both declaratory and injunctive relief, this case is within the purview of Shaw v. Delta Air Lines, Inc and Verizon Maryland, Inc. v. Public Service Commission.
2. Defendants argued that this matter was not ripe for judicial review, because, until approval to build the proposed liquefied natural gas plant is received, the relation between the local zoning ordinance and the federal statute at issue remains "what is in reality an abstract question of law." The Court concluded, however, that any efforts for authorization by the FERC would be futile if the County can simply execute a veto by local zoning legislation. Delaying resolution of the preemption issued in this case, moreover, would frustrate one of the purposes of the recent amendments to the Natural Gas Act, i.e., clarifying the respective roles played by FERC and the states in the administrative process. In sum, there is no need to withhold court consideration under such circumstances.
3. The Plaintiffs have sufficiently established that they have standing.The injury to the Plaintiffs is "certainly impending" in that any efforts for FERC approval is futile if the Baltimore County Council can exercise veto power by the subject Zoning Amendment.
4. The text, context, and legislative history of the Natural Gas Act ("NGA") clearly reflect the intent of the United States Congress to preempt local governments with respect to the siting of liquefied natural gas ("LNG") facilities.
5. Apart from the express preemption, in the alternative, the Court found that the Zoning Amendment is preempted because Congress intended for the NGA and its regulations to occupy the entire field of LNG regulation.
6. The Court also found that the Zoning Amendment is in direct conflict with the NGA and is therefore preempted (i.e., "conflict preemption").
7. The Court found that there are no circumstances under which the Zoning Amendment could be constitutionally valid. Thus, the U.S. v. Salerno standard is satisfied and the Zoning Amendment is facially unconstitutional.
Conclusion:
The amendment to section 256.4 of the Baltimore County Zoning Regulations enacted pursuant to Baltimore County Bill 71-06 is unenforceable because it is preempted under the Supremacy Clause of the United States Constitution by the Natural Gas Act, as amended by the Energy Policy Act of 2005 and the Defendants are enjoined from enforcing the Zoning Amendment.
The opinion is available in PDF. The Order and Judgment may be found here.
Wednesday, January 17, 2007
Retail Industry Leaders Ass'n v. Fielder (4th Cir. Ct. Appeals)
Decided January 17, 2006-Opinion by Judge Paul V. Niemeyer, in which Judge M. Blane Michael joined. Judge William B. Traxler, Jr., dissented.
(Note: Currently, Maryland Courts Watcher does not regularly cover Fourth Circuit decisions. We have made an exception in this case due to the public interest in this case.)
On January 12, 2006, the Maryland General Assembly enacted the Fair Share Health Care Fund Act, which requires employers with 10,000 or more Maryland employees to spend at least 8% of their total payrolls on employees' health insurance costs or pay the amount their spending falls short to the State of Maryland. Resulting from a nationwide campaign to force Wal-Mart Stores, Inc., to increase health insurance benefits for its 16,000 Maryland employees, the Act's minimum spending provision was crafted to cover just Wal-Mart. The Retail Industry Leaders Association, of which Wal-Mart is a member, brought suit against James D. Fielder, Jr., the Maryland Secretary of Labor, Licensing, and Regulation, to declare that the Act is preempted by the Employee Retirement Income Security Act of 1974 ("ERISA") and to enjoin the Act's enforcement. On crossmotions for summary judgment, the District Court entered judgment declaring that the Act is preempted by ERISA and therefore not enforceable, and this appeal followed.
Held:
Because Maryland's Fair Share Health Care Fund Act effectively requires employers in Maryland covered by the Act to restructure their employee health insurance plans, it conflicts with ERISA's goal of permitting uniform nationwide administration of these plans. The Court concluded therefore that the Maryland Act is preempted by ERISA and it affirmed the District Court's judgment.
The Court rejected Maryland's attack on the Retail Industry Leaders Association's assertion of "associational standing" to enforce the rights of its members (See Hunt v. Washington State Apple Advertising Comm’n, 432 U.S. 333, 345 (1977) (authorizing the standing of an association when (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit)) and ripeness. It also turned aside a jurisdictional attack based upon the Tax Injunction Act, 28 U.S.C. §1341. Maryland characterized the Fair Share Act as a state law that imposes a tax on employers. The Court concluded that the Fair Share Act constitutes a "healthcare regulation," rather than a "tax."
In dissent, Judge Traxler argued that:
(Note: Currently, Maryland Courts Watcher does not regularly cover Fourth Circuit decisions. We have made an exception in this case due to the public interest in this case.)
On January 12, 2006, the Maryland General Assembly enacted the Fair Share Health Care Fund Act, which requires employers with 10,000 or more Maryland employees to spend at least 8% of their total payrolls on employees' health insurance costs or pay the amount their spending falls short to the State of Maryland. Resulting from a nationwide campaign to force Wal-Mart Stores, Inc., to increase health insurance benefits for its 16,000 Maryland employees, the Act's minimum spending provision was crafted to cover just Wal-Mart. The Retail Industry Leaders Association, of which Wal-Mart is a member, brought suit against James D. Fielder, Jr., the Maryland Secretary of Labor, Licensing, and Regulation, to declare that the Act is preempted by the Employee Retirement Income Security Act of 1974 ("ERISA") and to enjoin the Act's enforcement. On crossmotions for summary judgment, the District Court entered judgment declaring that the Act is preempted by ERISA and therefore not enforceable, and this appeal followed.
Held:
Because Maryland's Fair Share Health Care Fund Act effectively requires employers in Maryland covered by the Act to restructure their employee health insurance plans, it conflicts with ERISA's goal of permitting uniform nationwide administration of these plans. The Court concluded therefore that the Maryland Act is preempted by ERISA and it affirmed the District Court's judgment.
The Court rejected Maryland's attack on the Retail Industry Leaders Association's assertion of "associational standing" to enforce the rights of its members (See Hunt v. Washington State Apple Advertising Comm’n, 432 U.S. 333, 345 (1977) (authorizing the standing of an association when (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit)) and ripeness. It also turned aside a jurisdictional attack based upon the Tax Injunction Act, 28 U.S.C. §1341. Maryland characterized the Fair Share Act as a state law that imposes a tax on employers. The Court concluded that the Fair Share Act constitutes a "healthcare regulation," rather than a "tax."
In dissent, Judge Traxler argued that:
[B]ecause the Act does not force a covered employer to make a choice that impacts an employee benefit plan. An employer can comply with the Act either by paying assessments into the special fund or by increasing spending on employee health insurance. The Act expresses no preference for one method of Medicaid support or the other. As a result, the Act is not preempted by ERISA.
* * * * *
Maryland is being buffeted by escalating Medicaid costs. The [Maryland] Act is a permissible response to the problem. Because a covered employer has the option to comply with the Act by paying an assessment — a means that is not connected to an ERISA plan — I would hold that the Act is not preempted.
The opinion is available in PDF.
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