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LEGAL INFORMATION INSTITUTE -- CORNELL LAW SCHOOL
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SAN REMO HOTEL, L. P. V. CITY AND COUNTY OF SANFRANCISCO (04-340)
Web-accessible at:
http://supct.law.cornell.edu/supct/html/04-340.ZS.html
Argued March 28, 2005 -- Decided June 20, 2005
Opinion author: Stevens
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Petitioners, hoteliers in respondent city,
initiated this litigation over the application of an ordinance
requiring them to pay a $567,000 fee for converting residential
rooms to tourist rooms. They initially sought mandamus in
California state court, but that action was stayed when they
filed suit in Federal District Court asserting, inter
alia, facial and as-applied challenges to the ordinance
under the Fifth
Amendment's Takings Clause. Although the District
Court granted the city summary judgment, the Ninth Circuit
abstained from ruling on the facial challenge under Railroad
Comm'n of Tex. v. Pullman Co., 312 U.S. 496, because
the pending state mandamus action could moot the federal
question. The court did, however, affirm the District
Court's ruling that the as-applied claim was unripe. Back
in state court, petitioners attempted to reserve the right to
return to federal court for adjudication of their federal
takings claims. Ultimately, the California courts rejected
petitioners' various state-law takings claims, and they
returned to the Federal District Court, advancing a series of
federal takings claims that depended on issues identical to
those previously resolved in the state courts. In order to
avoid being barred from suit by the general rule of issue
preclusion, petitioners asked the District Court to exempt
their federal takings claims from the reach of the full faith
and credit statute, 28 U.S.C. sect.
1738. Relying on the Williamson County Regional
Planning Comm'n v. Hamilton Bank of Johnson
City, 473 U.S.
172, 195, holding that takings claims are not ripe until a
State fails "to provide adequate compensation for the
taking," petitioners argued that, unless courts disregard
sect.1738 in takings cases, plaintiffs will be forced to
litigate their claims in state court without any realistic
possibility of ever obtaining federal review. Holding,
inter alia, that petitioners' facial attack was
barred by issue preclusion, the District Court reasoned that
sect.1738 requires federal courts to give preclusive effect to
any state-court judgment that would have such effect under the
State's laws. The court added that because California
courts had interpreted the relevant substantive state takings
law coextensively with federal law, petitioners' federal
claims constituted the same claims the state courts had already
resolved. Affirming, the Ninth Circuit rejected
petitioners' contention that general preclusion principles
should be cast aside whenever plaintiffs must litigate in state
court under Pullman and/or Williamson County.
Held: This Court will not create
an exception to the full faith and credit statute in order to
provide a federal forum for litigants seeking to advance
federal takings claims.
Pp. 11-23.
(a) The Court
rejects petitioners' contention that whenever plaintiffs
reserve their federal takings claims in state court under
England v. Louisiana Bd. of Medical Examiners, 375 U.S. 411,
federal
courts should review the reserved federal claims de
novo, regardless of what issues the state court may have
decided or how it may have decided them. The England
Court's discussion of the "typical case" in
which reservations of federal issues are appropriate makes
clear that the decision was aimed at cases fundamentally
distinct from petitioners'. England cases
generally involve federal constitutional challenges to a state
statute that can be avoided if a state court construes the
statute in a particular manner. Id., at 420. In such
cases, the purpose of abstention is not to afford state courts
an opportunity to adjudicate an issue that is functionally
identical to the federal question, but to avoid resolving the
federal question by encouraging a state-law determination that
may moot the federal controversy. See id., at
416-417, and n. 7. Additionally, the Court made
clear that the effective reservation of a federal claim was
dependent on the condition that plaintiffs take no action to
broaden the scope of the state court's review beyond
deciding the antecedent state-law issue. Id., at 419.
Because the Ninth Circuit invoked Pullman abstention
after determining that a ripe federal question existed as to
the petitioners' facial takings challenge, they were
entitled to insulate from preclusive effect that one federal
issue while they returned to state court to resolve their
mandamus petition. Petitioners, however, chose to advance
broader issues than the limited ones in the mandamus petition,
putting forth facial and as-applied takings challenges to the
city ordinance in their state action. By doing so, they
effectively asked the state court to resolve the same federal
issue they had previously asked it to reserve. England
does not support the exercise of any such right.
Petitioners' as-applied takings claims fare no better.
The Ninth Circuit found those claims unripe under Williamson
County, and therefore affirmed their dismissal. They were
never properly before the District Court, and there was no
reason to expect that they could be relitigated in full if
advanced in the state proceedings. Pp. 11-17.
(b) Federal
courts are not free to disregard sect.1738 simply to guarantee
that all takings plaintiffs can have their day in federal
court. Petitioners misplace their reliance on the Second
Circuit's Santini decision, which held that parties
who are forced to litigate their state-law takings claims in
state court pursuant to Williamson County cannot be
precluded from having those very claims resolved by a federal
court. The Santini court's reasoning is
unpersuasive for several reasons. First, both petitioners and
Santini ultimately depend on an assumption that
plaintiffs have a right to vindicate their federal claims in a
federal forum. This Court has repeatedly held to the contrary.
See, e.g., Allen v. McCurry, 449 U.S. 90,
103-104. Second, petitioners' argument assumes that
courts may simply create exceptions to sect.1738 wherever they
deem them appropriate. However, this Court has held that no
such exception will be recognized unless a later statute
contains an express or implied partial repeal. E.g.,
Kremer v. Chemical Constr. Corp., 456 U.S. 461, 468.
Congress has not expressed any intent to exempt federal takings
claims from sect.1738. Third, petitioners have overstated
Williamson County's reach throughout this
litigation. Because they were never required to ripen in state
court their claim that the city ordinance was facially invalid
for failure to substantially advance a legitimate state
interest, see Yee
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