Lynn Lumbard v. City of Ann Arbor, 913 F.3d 585

Ann Arbor enacted a 2001 ordinance requiring selected older homes (built with combined sewer outflows) to be retrofitted to redirect storm water to the storm sewer; the City paid installations or reimbursed up to $3,700.
The retrofit (Disconnect Program) involved invasive work (sump pits, pumps, penetrations, visible piping) and ongoing maintenance obligations for homeowners; affected owners complied between 2001–2003.
Homeowners brought inverse-condemnation suits in Michigan state court (Yu and Lumbard), filed England reservations to preserve federal claims, and the state courts dismissed the suits on the merits (holding owners owned the installations and thus no permanent physical occupation for takings purposes).
Plaintiffs then filed federal suits asserting a Fifth Amendment takings claim and a § 1983 claim; the district court dismissed the Fifth Amendment claim as issue-precluded and the § 1983 claim as claim-precluded under 28 U.S.C. § 1738 (Full Faith and Credit) applying Michigan preclusion law.
On appeal the Sixth Circuit affirmed, holding plaintiffs’ federal takings and § 1983 claims are precluded by the state-court judgments (San Remo / § 1738 principles) and rejecting arguments that Williamson exhaustion or England reservations saved the federal claims.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Williamson exhaustion forced remand and waived federal forum	Williamson is a jurisdictional bar; plaintiffs were compelled to remand and litigate in state court	Williamson is waivable; plaintiffs could have litigated in federal court and waived the defense by remanding	Court: Williamson is waivable; plaintiffs waived opportunity to keep federal forum by moving to remand
Whether an England reservation preserves federal takings claims after adverse state-court judgment	England reservation preserves federal claims even when remand is compelled by Williamson	England does not prevent § 1738 preclusion; San Remo controls	Court: England reservation does not overcome § 1738 preclusion; state judgments bind federal court
Whether state-court resolution on Michigan takings law precludes relitigation of federal takings claim	Plaintiffs: state decision on state law should not preclude a federal Fifth Amendment claim	City: Full Faith and Credit requires preclusion (issue or claim) depending on coextensiveness	Court: Preclusion applies—either issue preclusion (if coextensive) or claim preclusion—so federal takings claim is barred
Whether § 1983 claim can proceed after state-court takings adjudication	Plaintiffs: § 1983 claim distinct and not precluded	City: Claim preclusion bars § 1983 because it could have been raised in state action	Court: § 1983 claim is claim-precluded under § 1738 and Michigan res judicata rules

Williamson County Reg'l Planning Comm'n v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985) (ripeness/exhaustion rule for takings claims requiring state procedures first)
Stop the Beach Renourishment, Inc. v. Florida Dep't of Envtl. Prot., 560 U.S. 702 (2010) (Williamson-style defenses are nonjurisdictional and thus waivable)
San Remo Hotel, L.P. v. City and County of San Francisco, 545 U.S. 323 (2005) (Full Faith and Credit requires federal courts to give preclusive effect to state-court takings judgments)
Migra v. Warren City School Dist. Bd. of Educ., 465 U.S. 75 (1984) (federal courts must apply state preclusion law to state judgments)
England v. Louisiana State Bd. of Medical Examiners, 375 U.S. 411 (1964) (procedure for reserving federal constitutional questions while litigating state claims)
Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982) (permanent physical occupation takings doctrine)
Haywood v. Drown, 556 U.S. 729 (2009) (Supremacy Clause prohibits state statutes that discriminate against federal claims)
Sprint Communications, Inc. v. Jacobs, 571 U.S. 69 (2013) (federal courts’ strong obligation to exercise jurisdiction conferred by Congress)
Allen v. McCurry, 449 U.S. 90 (1980) (res judicata and collateral estoppel principles carried by § 1738)
Phelps v. United States, 274 U.S. 341 (1927) (pre-judgment interest and recognition that constitutional entitlement to compensation exists from the date of taking)