Asset Management Group, LLC v. Detroit, City of
2:23-cv-11496
| E.D. Mich. | Mar 28, 2025Background
- The City of Detroit demolished two properties—Robson and McNichols—using its emergency demolition ordinance due to immediate dangers posed by the buildings’ structural conditions.
- Plaintiffs (New Detroit Property, LLC for Robson; Asset Management Group, LLC for McNichols) brought suit alleging inverse condemnation and takings claims under federal and state constitutions, seeking compensation for the demolitions.
- The City counterclaimed to recover demolition costs from the property owners.
- The Robson Property had suffered a fire and was quickly deemed unsound by city inspectors; a "STAY OUT" notice was posted and emergency demolition proceeded. Written notice was sent even though not required.
- The McNichols Property had ongoing blight and code violations, was found to be hazardous, subject to prior non-emergency proceedings, and ultimately demolished under emergency authority after further inspection.
- New Detroit withdrew its claims regarding Robson and consented to the City’s counterclaim; Asset Management contested the validity of the McNichols demolition and lack of notice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the demolition a compensable taking? | Demolition without proper notice is an inverse condemnation requiring compensation. | Demolition was lawful under emergency police powers—no compensation required. | Not a taking; lawful exercise of police power—no compensation required. |
| Sufficiency of notice to owner | Asset Management did not receive notice, and City had duty to ensure proper notice. | Emergency provision does not require owner notice; notice was given to legal owner. | City not required to provide notice under emergency demolition code; procedures followed. |
| Legitimacy of emergency determination | Disputed that emergency existed; photos avoidably misrepresent property condition. | Inspector, photographs showed imminent danger; determination by building official valid. | Photographic and expert evidence undisputed; emergency status appropriately determined. |
| City entitlement to cost recovery | Plaintiffs resisted, but New Detroit conceded; Asset Management disputed obligation. | Demolitions were proper; city entitled to reimbursement by ordinance. | City entitled to reimbursement for demolition costs for both properties. |
Key Cases Cited
- Chicago, B. & Q.R. Co. v. Chicago, 166 U.S. 226 (incorporates Takings Clause against states)
- Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (physical occupation is a taking)
- Davet v. City of Cleveland, 456 F.3d 549 (demolition to abate nuisance is not a taking if local law/procedure is followed)
- Ostipow v. Federspiel, 824 F. App’x 336 (police power actions generally not subject to Takings claims)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (summary judgment standard)
- Celotex v. Catrett, 477 U.S. 317 (burden-shifting in summary judgment)
- Scott v. Harris, 550 U.S. 372 (court may reject factual claims contradicted by record evidence)