Justia U.S. 6th Circuit Court of Appeals Opinion Summaries

Ronald Davis, the owner of a corporation, was liable for over $1 million in unpaid federal employment taxes and penalties. After demands for payment went unanswered, the government filed suit against Ronald to reduce its tax assessments to judgment and sought to enforce its tax liens through the sale of the primary residence of Ronald and his wife, Diane. The government named Diane, who did not owe any unpaid taxes, as a defendant in the action because she had an interest in the properties. The district court issued an order of sale authorizing the sale of the primary residence. Diane appealed, arguing (1) the district court should have allowed the government to sell only Ronald’s interest in the property; and (2) the order of sale violated 26 U.S.C. 7403 and the Fifth Amendment’s Just Compensation Clause. The Sixth Circuit affirmed the district court’s order of sale, holding (1) the district court did not err when it declined to limit the government to the sale of Ronald’s interest in the property; and (2) the order of sale did not violate section 7403 or the Just Compensation Clause. View "United States v. Davis" on Justia Law

Columbia stores natural gas in Medina Field, a naturally-occurring system of porous underground rock, pumping gas into the Field during summer, during low demand, and withdrawing it during winter. Medina is among 14 Ohio gas storage fields used by Columbia. Columbia received a federal Certificate of Public Convenience and Necessity, 15 U.S.C. 717f, and was required to compensate those who own part of the Field by contractual agreement or eminent domain. The owners allege that Columbia stored gas for an indeterminate time without offering compensation and then offered $250 per lot. Each Medina owner rejected this offer. Columbia did not bring eminent domain proceedings. Other Ohio landowners accused Columbia of similar behavior and filed the Wilson class action in the Southern District of Ohio, including the Medina owners within the putative class. The Medina owners filed suit in the Northern District. Both actions claim trespass and unjust enrichment under Ohio law, and inverse condemnation under the Natural Gas Act. The Wilson suit also seeks damages for “native” natural gas Columbia takes when it withdraws its own gas. Columbia filed a counterclaim in Wilson, seeking to exercise eminent domain over every member of the putative class and join the Medina owners. The Northern District applied the first-to-file rule and dismissed. The Sixth Circuit reversed. The rule does apply, but dismissal was an abuse of discretion given jurisdictional and procedural hurdles to having the Medina claims heard in Wilson. View "Baatz v. Columbia Gas Transmission, LLC" on Justia Law

Cadillac Place (former General Motors Building), a Detroit office complex, is home to state offices, a court of appeals, a restaurant, a gift store, and even a barber shop. It is owned by Michigan Strategic Fund, a public entity, and leased by the state. Babcock, an attorney, s disabled due to Friedreich’s Ataxia, a degenerative neuromuscular disorder that impairs her ability to walk. She worked in Cadillac Place. Babcock alleged that its design features denied her equal access to her place of employment in violation of the Americans with Disabilities Act , 42 U.S.C. 12132, and Section 504 of the Rehabilitation Act of 1973, 29 U.S.C. 794(a). The Sixth Circuit affirmed dismissal. Babcock did not identify a service, program, or activity of a public entity from which she was excluded or denied a benefit. The court noted the dispositive distinction between access to a facility and access to programs or activities. Babcock only identified facilities-related issues. View "Babcock v. State of Mich." on Justia Law

In 2003, the Burniacs executed a mortgage on their home in Plymouth, Michigan to secure a loan from WaMu. Wells Fargo acted as servicer of the mortgage and sent Burniac monthly mortgage statements. WaMu assigned ownership of Burniac’s mortgage to Wells Fargo in 2007. Burniac continued to receive statements from Wells Fargo. WaMu filed for bankruptcy in 2008. Burniac sent his mortgage payments to Wells Fargo for several years, but eventually stopped making payments. Wells Fargo initiated foreclosure proceedings;a foreclosure sale was scheduled for May 23, 2013. Burniac filed suit to prevent the sale, arguing that the assignment was invalid. The state court purportedly entered a default judgment against the bank and preliminarily enjoined the foreclosure sale. Wells Fargo then removed the action to a federal district court, which refused to remand and later entered summary judgment for the bank. The Sixth Circuit affirmed, rejecting an argument that the purported state court default prevented the federal court from entering summary judgment and required a remand. Burniac failed to demonstrate that the alleged assignment irregularities will subject him to double liability, placed him in a worse position to keep his property, or prejudiced him in any other way. View "Burniac v. Wells Fargo Bank, N.A." on Justia Law

After discovering hazardous contaminants at Sanford and Orlando coal gasification plants in the 1990s, the EPA concluded that Florida Power and previous owners were liable for costs of removal and remediation. In 1998 and 2003, Florida Power entered into “Administrative Order by Consent for Remedial Investigation/Feasibility Studies” (AOCs) with the EPA for the sites, under which Power agreed to conduct studies to determine the public safety threat and evaluate options for remedial action. Power agreed to pay the EPA about $534,000 for past response costs at the sites. After the investigation and study at the Sanford site, the EPA entered Records of Decision. In 2009, the court approved a consent decree for actual performance of the Sanford remediation. Regarding the Orlando site, Power submitted a draft Remedial Investigation Report, Risk Assessment, and Remedial Alternative Technical Memorandum that was under EPA review when, in 2011, Power filed this cost recovery and contribution action under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, 42 U.S.C. 9601) against a successor to a former owner-operator of the sites. The court dismissed, finding that the 1998 and 2003 AOCs were “settlement agreements” and triggered CERCLA’s three-year statute of limitations. The Sixth Circuit reversed, finding that the AOCs did not constitute “administrative settlements.” View "Fla. Power Corp. v. FirstEnergy Corp." on Justia Law

In 1993, the Patereks, owners of PME, an injection molding company, relocated the business from Macomb County to the Village Armada, after purchasing a former high school auto shop. The Planning Commission issued the required Special Approval Land Use permit (SALU) with restrictions. Over the following years, the Patereks were occasionally in violation of the SALU, obtained modifications, and expanded the business. Paterek became involved in local government and was sometimes at odds with other local politicians, including a planning commissioner. Patereks ultimately filed suit under 42 U.S.C. 1983, after the village declined perform inspections and to issue a certificate of occupancy for a 2013 expansion. The Sixth Circuit reversed summary judgment in favor of the defendants, reasoning that a jury could reasonably find that defendants retaliated against Patereks for having complained about officials, in violation of the First Amendment; that defendants arbitrarily and capriciously ticketed Patereks, in violation of substantive due process; that defendants, due to their animus against Patereks, subjected PME to disparate treatment, in violation of the Equal Protection Clause; and that the district court erroneously denied Patereks’ civil contempt motion. View "Paterek v. Village of Armada" on Justia Law

Anderson’s daughter, C.A., suffers from disabilities that affect her ability to walk and balance independently. A miniature horse enables her to play and get exercise in her backyard without adult assistance. Anderson first acquired a horse in 2010. In 2013, the city passed an ordinance banning horses from residential property and prosecuted Anderson for violating it. Anderson claimed that the Americans with Disabilities Act, 42 U.S.C. 12101, and the Fair Housing Amendments Act, 42 U.S.C. 3601, entitle her to keep the horse as C.A.'s service animal. The Hamilton County Municipal Court found Anderson guilty. Anderson sued. The district court granted the city summary judgment, finding Anderson’s claims barred by claim and issue preclusion stemming from her Municipal Court conviction. The Sixth Circuit reversed. Because fact-finding procedures available in a municipal court criminal proceeding differ substantially from those available in a civil proceeding, Anderson’s conviction has no preclusive effect on this lawsuit. While there is no evidence that the city’s actions were motivated by discriminatory intent against C.A. or had a disparate impact on disabled individuals, there are significant factual disputes regarding whether the ADA or FHAA require the city to permit Anderson to keep her miniature horse at her house. View "Anderson v. City of Blue Ash" on Justia Law

The Debtors’ chapter 13 plan provided for cure of any defaults and maintenance of regular monthly mortgage payments on real property, pursuant to 11 U.S.C. 1322(b)(5). The Bank failed to file a proof of claim and did not receive any disbursements for the mortgage debts. After their chapter 13 discharge, the Debtors sought a determination that the Bank’s liens had been discharged. The bankruptcy court determined that the liens had passed through the bankruptcy, but that the amount of debt secured by each should be reduced by the amount that the Bank would have been paid if it had filed proofs of claim. The Sixth Circuit Bankruptcy Appellate Panel reversed the reduction of the debt amount. Although a secured creditor is not required to file a proof of claim to preserve its lien, its failure to do so affects its right to payment under a chapter 13 plan. The Debtors or the Trustee could have filed a proof of claim on the Bank’s behalf, so that the Debtors would not have exited bankruptcy in default on the debt. Excess cash of more than $9,000 was returned to the Debtors after the plan was consummated. If the decision to reduce the debt were affirmed, the Debtors would gain a windfall. View "In re: Matteson" on Justia Law

In 2008, plaintiffs obtained a loan from Quicken and granted a mortgage on their property to Quicken’s nominee, Mortgage Electronic Registration Systems, “MERS.” The note and mortgage ultimately were conveyed to Bank of America. Plaintiffs defaulted. Bank of America foreclosed by advertisement under Mich. Comp. Laws 600.3201. The Federal Home Loan Mortgage Corporation, “Freddie Mac,” purchased the property at a foreclosure sale. The plaintiffs did not exercise their “equity of redemption” within the six-month statutory redemption period under Michigan law. Freddie Mac initiated eviction. In their counter-complaint, plaintiffs argued that the foreclosure was fraudulent and violated Michigan law because there was no chain of title evidencing ownership by Bank of America, which, therefore, did not have standing to foreclose; Freddie Mac was negligent for failing to evaluate plaintiffs’ loan under the Home Affordable Modification Program; the foreclosure and subsequent eviction were “wrongful” under Michigan law; and Freddie Mac violated their due process rights because its status as a government actor precluded foreclosure by advertisement. The Sixth Circuit affirmed dismissal of plaintiffs’ claims, reasoning that any negligence was not attributable to Freddie Mac and compliance with Michigan’s foreclosure-by-advertisement procedures satisfied the requirements of the Due Process Clause. View "Rush v. Freddie Mac" on Justia Law

The Section 8 low-income housing assistance voucher program, 42 U.S.C. 1437f(o), is administered by public housing agencies such as Cuyahoga Metropolitan Housing Authority (CMHA). Program regulations define “rent to [the] owner” as “[t]he total monthly rent payable to the owner under the lease for the unit. Rent to owner covers payment for any housing services, maintenance and utilities that the owner is required to provide and pay for.” Velez and Hatcher, voucher recipients, entered into one-year leases with K&D. The leases provide: “If Resident(s) shall holdover after the end of the term of this Rental Agreement, said holdover shall be deemed a tenancy of month to month and applicable month to month fees shall apply.” Velez entered into a month-to-month tenancy after her one-year term expired; Hatcher entered into month-to-month tenancies, and, later, a nine-month agreement. K&D charged fees of $35.00 to $100.00 per month. CMHA did not treat these short-term rental fees as rent under the voucher program. Velez and Hatcher were required to pay the fees and filed suit under 42 U.S.C. 1983. The court granted CMHA summary judgment, holding that the fees were not rent. The Sixth Circuit reversed. Recasting the charge as a short-term fee, rather than rent, does not change that it is consideration paid by the tenant for use of the rental unit. View "Velez v. Cuyahoga Metro. Hous. Auth." on Justia Law