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Decided: February 21, 2014

The Fourth Circuit held that the United States District Court for the Eastern District of Virginia properly dismissed Clear Sky Car Wash LLC’s (Clear Sky) complaint against the City of Chesapeake (the City), the Virginia Department of Transportation (VDOT), the United States Department of Transportation (USDOT), and certain employees and agents of the City (collectively, the defendants) because §§ 4651 and 4655 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA) do not contain any individually enforceable rights, 42 U.S.C. § 1983 cannot be used to enforce §§ 4651 and 4655, and Clear Sky did not assert a claim under the Administrative Procedure Act (APA).  The Fourth Circuit therefore affirmed the judgment of the district court.

In November 2008, the Chesapeake City Council approved a VDOT project (the project) to widen part of U.S. Route 17 and replace a bridge on the Elizabeth River.  Though the City was going to manage the project, the funds for the project were to come from the City, VDOT, and USDOT.  The project required the City to obtain a parcel of land owned by Clear Sky.  The City hired two appraisers, each of whom valuated the parcel on a square-foot basis without examining the values of other “pad sites”—that is, other “freestanding parcel[s] of commercial real property located in front of or near a shopping center such that it benefits from traffic to the shopping center.”  The City gave copies of the appraisals to Clear Sky in August 2011, stating that it was accepting the lower of the two appraisals—which valuated the parcel at $2.15 million.  In January 2012, the City offered Clear Sky $2.15 million as just compensation; Clear Sky rejected the City’s offer.  The City then initiated a quick take proceeding under Virginia Code §§ 33.1-119 and 33.1-120, filing a certificate of take and depositing the valuation amount with the Circuit Court for the City of Chesapeake.

Clear Sky filed a lawsuit against the defendants, claiming that the defendants violated Clear Sky’s rights under the URA—specifically, rights provided by §§ 4651 and 4655.  The defendants then filed Rule 12(b)(a) and 12(b)(6) motions to dismiss, and the district court granted the defendants’ motions.  On appeal, Clear Sky noted that, under § 4651 of the URA, federal agencies acquiring real property must follow ten specific policies “to [inter alia] assure consistent treatment for owners . . . and to promote public confidence in Federal land acquisition practices”; furthermore, because the federal government provided some of the funding in this instance, § 4655 made § 4651 applicable to the project.  Thus, Clear Sky argued that it was entitled to enforce § 4651’s policies through a direct cause of action against the defendants, through a cause of action pursuant to 42 U.S.C. § 1983, and under the APA.

With regard to the purported direct cause of action, the Fourth Circuit noted that 42 U.S.C. § 4602(a) explicitly states that “[t]he provisions of section 4651 of this title create no rights or liabilities and shall not affect the validity of any property acquisitions by purchase or condemnation”; furthermore, § 4655 simply modifies the scope of § 4651 in certain instances and does not create any policies by itself.  The Fourth Circuit then found that, because §§ 4651 and 4655 do not provide individually enforceable rights, Clear Sky had no remedy under 42 U.S.C. § 1983—as § 1983 does not confer substantive rights.  Lastly, the Fourth Circuit found that Clear Sky’s brief reference to the APA in its opening statement of jurisdiction did not sufficiently plead a cause of action under the APA; furthermore, even under a liberal reading of the alleged facts in Clear Sky’s complaint, there was no “final agency action” that could be judicially reviewed under the APA.

Full Opinion

– Stephen Sutherland