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Bridge Aina Le'a, LLC v. State of Hawaii Land Use Commission; Vladimir P. Devens

March 30, 2012

BRIDGE AINA LE'A, LLC,
PLAINTIFF,
v.
STATE OF HAWAII LAND USE COMMISSION; VLADIMIR P. DEVENS, IN HIS INDIVIDUAL AND OFFICIAL CAPACITY; KYLE CHOCK, IN HIS INDIVIDUAL AND OFFICIAL CAPACITY; THOMAS CONTRADES, IN HIS INDIVIDUAL AND OFFICIAL CAPACITY; LISA M. JUDGE, IN HIS INDIVIDUAL AND OFFICIAL CAPACITY; NORMAND R. LEZY, IN HIS INDIVIDUAL AND OFFICIAL CAPACITY; NICHOLAS W. TEVES, IN HIS INDIVIDUAL AND OFFICIAL CAPACITY; RONALD I. HELLER, IN HIS OFFICIAL CAPACITY; DUANE KANUHA, IN HIS OFFICIAL CAPACITY; CHARLES JENCKS, IN HIS OFFICIAL CAPACITY; JOHN DOES 1-10; JANE DOES 1-10; DOE PARTNERSHIPS 1-10; DOE CORPORATIONS 1-10; DOE ENTITIES 2-10 AND DOE, DEFENDANTS.



The opinion of the court was delivered by: Susan Oki Mollway Chief United States District Judge

ORDER STAYING CASE PENDING RESOLUTION OF THE STATE CASE

I. INTRODUCTION.

This case arises out of a decision by the State of Hawaii Land Use Commission to reclassify a parcel of land from urban use to agricultural use. Plaintiff Bridge Aina Le'a, LLC ("Bridge"), the owner of the parcel, claims that, by reclassifying the land, Defendants State of Hawaii Land Use Commission (the "Commission"), and some of its commissioners--Vladimir P. Devens, Kyle Chock, Thomas Contrades, Lisa M. Judge, Normand R. Lezy, Nicholas W. Teves, Ronald I. Heller, Duane Kanuha, and Charles Jencks (collectively, "the Commissioners")--violated Bridge's rights under the United States Constitution, the Hawaii constitution, and various Hawaii laws. Bridge seeks both injunctive and monetary relief as to all Defendants.

Bridge appealed the Commission's decision to the state court and, separately, initiated the present action in state court. Defendants removed this case to this court based on federal question jurisdiction, as the Complaint asserts various federal constitutional claims. Defendants moved for dismissal on numerous grounds. Among other things, Defendants contended that this court should abstain from deciding the constitutional issues in light of the pending state court administrative appeal. Since the filing of Defendants' motion, the state court has ruled in favor of Bridge in the administrative appeal. Defendants say they intend to appeal that ruling. In light of that ruling, Defendants have changed their position and now maintain that abstention is inappropriate. Bridge, on the other hand, now argues in favor of the very abstention it earlier opposed and asks this court to remand either the whole case or at least the state law claims. Although agreeing that abstention is appropriate, the court remands no claims and stays the entirety of the present action pending the resolution of the administrative appeal.

II. BACKGROUND.

A. Factual Background.

The subject parcel of land consists of 1,060 acres in South Kohala, on the island of Hawaii. Notice of Removal Ex. 1, ECF No. 1 ("Complaint") ¶ 8. On November 25, 1987, the parcel was purchased by a private company that sought to develop a large residential community. Id. ¶ 9. Toward that end, the purchaser petitioned to reclassify the land from "agricultural use" to "urban use." Id. The Commission approved the petition on condition that 60 percent of the homes built would be "affordable" units. Id. at 11.

During the next two decades, the property changed ownership. Eventually, Bridge became the owner. Id. ¶¶ 12, 23. When Bridge acquired the property, it was classified for "urban use" and subject to an amended affordable housing condition that still required 60 percent of the homes to be affordable, but that also set a minimum of 1,000 affordable homes. Id. ¶ 15.

After various proceedings, including proceedings that resulted in amendments to the condition, see Compl. ¶¶ 23-31, 37-55, the Commission, in September 2009, ordered Bridge and DW Aina Le'a Development ("DW"), the company to which Bridge intended to assign the project, to complete 16 affordable units by March 31, 2010. Id. ¶ 61. The 16 units, as well as other work on the project, were allegedly completed by June 2010. Id. ¶ 65. However, allegedly because the affordable homes were not completed by the deadline of March 31, 2010, the Commission determined that Bridge and DW had not satisfied the applicable condition. Id. ¶ 76. In January 2011, the Commission voted to reclassify the land back to agricultural use. Id. ¶ 93.

B. Procedural Background.

Bridge filed two actions challenging the Commission's decision to reclassify the land back to agricultural use. First, Bridge sought judicial review of the Commission's decision through an administrative appeal. Second, on June 7, 2011, Bridge filed the present action in state court, asserting various federal and state constitutional claims, as well as claims based on other state law grounds. The constitutional claims assert procedural and substantive due process violations, equal protection violations, and unconstitutional takings under both the United States Constitution and the Hawaii constitution. Defendants removed this case to federal court, then moved to dismiss all claims.

On Monday, December 19, 2011, this court held a hearing on the motion to dismiss. At that hearing, the parties informed the court that, on Friday, December 16, 2011, Judge Elizabeth Strance of the Circuit Court of the Third Circuit of the State of Hawaii had orally ruled in favor of Bridge on its administrative appeal. In light of this development, the court instructed the parties to submit supplemental briefing addressing how Judge Strance's ruling affected the present action and the pending motion to dismiss. See ECF No. 38.

Judge Strance, as explained in her written order and findings of fact and conclusions of law, reversed and vacated the Commission's decision to reclassify Bridge's land back to agricultural use. See Supp. Mem. Regarding Effect of State Court Ruling Ex. A ("Administrative Appeal"), Mar. 9, 2012, ECF No. 41-2. She concluded that the Commission's decision violated chapters 205 and 91 of the Hawaii Revised Statutes; Bridge and DW's right to due process under the Fourteenth Amendment of the United States Constitution and article I, section 5, of the Hawaii constitution; and Bridge and DW's right to equal protection under the United States Constitution and the Hawaii constitution. Id. Defendants have informed the court that they intend to appeal Judge Strance's order. Defs.' Mem. Re Effect of State Court Ruling on Defs.' Mot. to Dismiss Compl. Filed June 7, 2011, at 3, Mar. 9, 2012, ECF No. 42.

III. ANALYSIS.

Bridge's Complaint asserts the following claims: Count

I: Denial of Due Process of Law (federal and state constitutions); Count II: Inverse Condemnation (federal and state constitutions); Count III: Denial of Equal Protection of Law (federal and state constitutions); Count IV: Common Law Deprivation of Vested Rights; Count V: Equitable Estoppel; Count VI: 42 U.S.C. § 1983 (federal due process, equal protection, and takings claims); Count VII: Violation of Hawaii Revised Statutes Chapters 91, 92, and 205 and Chapter 15-15 of the Hawaii Administrative Rules; Count VIII: Unconstitutional Land Development Conditions (federal and state constitutions);

Count IX: Injunctive and Declarative Relief; Count X: Declaratory Relief under Hawaii Revised Statutes § 632-1; and Count XI: Attorneys' Fees and Costs under 42 U.S.C. § 1988.

Defendants argued in their motion to dismiss that, among other things, this court should abstain and stay Bridge's federal takings claim pursuant to Railroad Commission of Texas v. Pullman Co., 312 U.S. 496 (1941), given the pending administrative appeal. Then, after Judge Strance ruled, Defendants argued that Pullman abstention no longer applied. Bridge, on the other hand, initially opposed abstention, but, in its supplemental brief and at the continued hearing on this motion, adamantly argued that Pullman abstention was appropriate. Relying heavily on VH Property Corp. v. City of Rancho Palos Verdes, 622 F. Supp. 2d 958, 962 (C.D. Cal. 2009), Bridge now argues that this court should invoke Pullman abstention and either remand the entire case to state court, or remand the state law claims and stay the federal claims pending resolution of the state law claims in state court. The court agrees that VH Property is particularly instructive and ...


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