922 F.3d 309
5th Cir.2019Background
- Cherry Knoll purchased 27.7 acres in 2006 and prepared subdivision plats in 2008; those plats were approved by the City but never recorded by the landowner.
- In 2013–2014 the City planned improvements to adjacent Flint Rock Road, retained consultants (Schwendinger) and HDR to manage land acquisition (including appraisals and negotiations), and sought part of Cherry Knoll’s property (Parcel 16/16A).
- City agents and contractors discussed using the earlier unrecorded plat (which showed a “future” right-of-way overlapping Parcel 16) as leverage; the City recorded the 2008 plats in August 2014 despite Cherry Knoll’s objections and without the current owners’ consent.
- The City obtained multiple appraisals (one before recordation, one after using plat-based floodplain data) and negotiated; ultimately the parties settled (City bought Parcel 16 for a negotiated sum and agreed to vacate the plats), but Cherry Knoll alleged the settlement was induced by mutual mistake or fraud.
- Cherry Knoll sued the City, City Manager Jones, HDR, and others under 42 U.S.C. § 1983 (procedural due process, substantive due process, equal protection), alleging the filing of the plats and related conduct deprived property rights and that HDR acted under color of law; the district court dismissed under Rule 12(b)(6).
- The Fifth Circuit reversed the dismissal as to the City, Jones, and HDR and reinstated the state-law claims for the district court to adjudicate after discovery.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether City can be liable under § 1983 via a municipal policy/decision to record the plats | City: the City Council made a deliberate choice to record the plats and use them as leverage, satisfying Pembaur/Monell | City: the filings were staff actions, not a final policymaker decision attributable to the municipality | Reversed dismissal — allegations plausibly show a council-level deliberate decision and satisfy Monell/Pembaur pleading standard |
| Whether City Manager Jones is entitled to qualified immunity for directing/participating in the plat filing | Cherry Knoll: Jones acted beyond authority by causing plats to be filed without owner consent, violating state law and constitutional rights | Jones: his acts were within discretionary authority and thus protected by qualified immunity | Reversed dismissal — Jones did not meet burden to show the conduct was within his discretionary authority; qualified immunity not established at pleading stage |
| Whether HDR, a private contractor, acted "under color of law" for § 1983 purposes | Cherry Knoll: HDR was hired to handle acquisition, participated in strategy and communications, and was a willful participant in joint action with City officials | HDR: was a consultant acting on legitimate instructions; not a conspirator or state actor | Reversed dismissal — allegations plausibly show HDR was a willful participant in joint action with the City (Dennis v. Sparks test) |
| Whether the district court properly declined to retain state-law claims after dismissing federal claims | Cherry Knoll: if federal claims survive, state claims should be reinstated under supplemental jurisdiction | Defendants: district court properly declined jurisdiction after dismissing federal claims | Reversed — federal claims reinstated; court reinstated state-law claims for further proceedings under § 1367(a) |
Key Cases Cited
- Monell v. New York City Dept. of Social Servs., 436 U.S. 658 (municipal liability requires action pursuant to official policy)
- Pembaur v. City of Cincinnati, 475 U.S. 469 (single decision by municipal policymakers can establish municipal policy)
- Dennis v. Sparks, 449 U.S. 24 (private parties are acting under color of state law if willful participants in joint action with state actors)
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading standard: facial plausibility required to survive Rule 12(b)(6))
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading standard and plausibility framework)
- Gates v. Texas Dep’t of Protective & Regulatory Servs., 537 F.3d 404 (qualified immunity framework in Fifth Circuit)