THOMAS GEARING, ET AL V. CITY OF HALF MOON BAY, No. 21-16688 (9th Cir. 2022)
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Plaintiffs sought to build housing on their properties in an area that under the the City of Half Moon Bay’s (City) Land Use Plan (LUP) was designated for public recreation and which severely restricted housing development. Plaintiffs took the position that California Senate Bill 330 (SB 330), enacted in 2019 to increase the stock of affordable housing in the state, required the City to approve their proposed development plan. After rejecting Plaintiffs’ proposal, the City informed plaintiffs that it intended to acquire their properties through eminent domain and made a purchase offer based on the properties’ appraised values. Plaintiffs rejected the offer and filed this action in district court claiming, among other things, that the City effected a regulatory taking in violation of the Fifth and Fourteenth Amendments by rejecting their building proposal and enforcing LUP’s restrictions on their property.
The Ninth Circuit affirmed the district court’s order granting the City’s motion to abstain pending resolution of an eminent domain action in state court. The panel held that as an initial matter, neither Knick nor Pakdel, which address when a claim accrues for purposes of judicial review, explicitly limit abstention in takings litigation. Abstention allows courts to stay claims that have already accrued. The panel held that the requirements for Pullman abstention were met in this case. First, the complaint touched a sensitive area of social policy, land use planning. Second, a ruling in the state eminent domain action would likely narrow the federal litigation.
Court Description: Civil Rights. In an action brought pursuant to 42 U.S.C. § 1983 asserting a regulatory taking and related claims, the panel affirmed the district court’s order granting the City of Half Moon Bay’s motion to abstain pursuant to Railroad Commission of Texas v. Pullman Co., 312 U.S. 496 (1941), pending resolution of an eminent domain action in state court. Plaintiffs sought to build housing on their properties in an area that under the City’s Land Use Plan (LUP) was designated for public recreation and which severely restricted housing development. Plaintiffs took the position that California Senate Bill 330 (SB 330), enacted in 2019 to increase the stock of affordable housing in the state, required the City to approve their proposed development plan. After rejecting plaintiffs’ proposal, the City informed plaintiffs that it intended to acquire their properties through eminent domain and made a purchase offer based on the properties’ appraised values. Plaintiffs rejected the offer and filed this action in district court claiming, among other things, that the City effected a regulatory taking in violation of the Fifth and Fourteenth Amendments by rejecting their building proposal and enforcing LUP’s restrictions on their property. The City then filed an eminent domain action in state court and a Motion to Abstain in the federal case pending resolution of the state action. The panel first rejected plaintiffs’ argument that Knick v. Township of Scott, 139 S. Ct. 2162 (2019) and Pakdel v. City and County of San Francisco, 141 S. Ct. 2226 (2021), which rejected state-forum exhaustion requirements for takings claims, precluded Pullman abstention in this case because abstention would force plaintiffs to litigate their federal claims in state court. The panel held that as an initial matter, neither Knick nor Pakdel, which address when a claim accrues for purposes of judicial review, explicitly limit abstention in takings litigation. Abstention allows courts to stay claims that have already accrued. Even if Knick and Pakdel were read to prohibit abstention when it would create effective exhaustion requirements for takings plaintiffs, those cases would not preclude abstention in this case. Here, the state court could adjudicate the eminent domain action without reaching the regulatory taking issue because eminent domain and regulatory takings suits compensate property owners for different injuries. Even if the regulatory taking issue could be analyzed as part of the fair market value calculation in the eminent domain action, it need not be. Moreover, plaintiffs had made a reservation under England v. Louisiana State Board of Medical Examiners, 375 U.S. 411, 421 (1964), in the state proceedings, which prevented the state court from ruling on federal issues. The panel held that the requirements for Pullman abstention were met in this case. First, the complaint touched a sensitive area of social policy, land use planning. Second, a ruling in the state eminent domain action would likely narrow the federal litigation because it would require the state court to interpret LUP Section 9.3.5 and SB 330, and the proper interpretation of these regulations was relevant to the federal claims. SB 330 had not been interpreted by any California courts, and so its impact, if any, on local regulations like LUP Section 9.3.5 was unsettled. Pullman’s minimal requirement for uncertainty therefore were satisfied in this case.
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