Driftless Area Land Conservanc v. Rebecca Valcq ( 2021 )

United States Court of Appeals
For the Seventh Circuit
____________________
No. 20-3325
DRIFTLESS AREA LAND CONSERVANCY and
WISCONSIN WILDLIFE FEDERATION,
Plaintiffs-Appellees,
v.
REBECCA VALCQ and TYLER HUEBNER, ∗
in their official capacities as members of
the Public Service Commission of Wisconsin,
Defendants-Appellants,
and
AMERICAN TRANSMISSION COMPANY LLC, et al.,
Intervenor Defendants-Appellants.
____________________
Appeal from the United States District Court
for the Western District of Wisconsin.
No. 19-cv-1007 — William M. Conley, Judge.
____________________
ARGUED FEBRUARY 17, 2021 — DECIDED OCTOBER 21, 2021
____________________
∗ Commissioner Tyler Huebner has been substituted for former Commis-
sioner Michael Huebsch, who resigned from office. See FED. R. APP.
P. 43(c)(2).
2 No. 20-3325
Before SYKES, Chief Judge, and FLAUM and ROVNER, Circuit
Judges.
SYKES, Chief Judge. This appeal is another chapter in con-
current federal and state litigation challenging the construc-
tion of a $500 million, 100-mile power line in southwestern
Wisconsin. In September 2019 the Public Service Commis-
sion of Wisconsin issued a permit authorizing two transmis-
sion companies and an electricity cooperative to build and
operate the line. A few months later, two environmental
groups filed lawsuits in both federal and state court seeking
to invalidate the permit. As relevant here, the parallel suits
allege that two of the three commissioners had disqualifying
conflicts of interest and should have recused themselves.
Both suits raise federal due-process claims; the state litiga-
tion also invokes state recusal law and contests the permit on
other state-law grounds.
The case was last here at an early stage of the proceed-
ings when the district judge rejected the permit holders’
motion to intervene. We reversed that decision and remand-
ed with instructions to grant the intervention motion.
Driftless Area Land Conservancy v. Huebsch (“Driftless I”),
969 F.3d 742 (7th Cir. 2020). Rulings on dismissal motions
followed, and the judge significantly narrowed the scope of
the case. But he denied the commissioners’ motion to dismiss
based on sovereign immunity. The case returns to us on that
issue.
The commissioners have been sued in their official capac-
ities, so sovereign immunity blocks this suit in its entirety
unless it falls within the Ex parte Young exception, which
authorizes a federal suit against state officials for the pur-
pose of obtaining prospective relief against an ongoing
No. 20-3325 3
violation of federal law. The environmental groups seek an
order vacating the permit or enjoining its enforcement; the
latter is prospective relief. The harder question is whether
the suit challenges an ongoing violation of federal law. The
alleged due-process violation occurred (if at all) in Septem-
ber 2019 when the commissioners approved the permit. The
environmental groups contend that the violation is ongoing
as long as the permit remains in force and effect and the
commissioners have the power to enforce, modify, or rescind
it. Though there is little precedent precisely on point for a
claim like this one, we hold that Ex parte Young applies and
therefore agree with the judge’s ruling on sovereign immuni-
ty.
The commissioners also moved for abstention under
Colorado River Water Conservation District v. United States,
424 U.S. 800, 818 (1976), which authorizes a federal court to
abstain from exercising jurisdiction and stay a case to await
the outcome of parallel state litigation when there is a sub-
stantial likelihood that the state case will resolve the federal
claim. The judge denied the request, reasoning that the
federal and state suits are not parallel because the state case
doesn’t raise a federal due-process claim. That was an error;
as we’ve noted, both cases raise federal due-process claims.
Although the abstention ruling is not before us, we may
raise abstention sua sponte and do so here.
The state and federal suits are clearly parallel for purpos-
es of Colorado River. The environmental groups have raised
materially identical due-process recusal claims in both state
and federal court. Given the context—this case implicates
serious state interests regarding the operation of Wisconsin
administrative law and judicial review of state-agency
4 No. 20-3325
proceedings—it’s appropriate to abstain from exercising
federal jurisdiction to give the state courts an opportunity to
decide the recusal issue. Litigating the same conflict-of-
interest questions in both court systems is duplicative and
wasteful; comity and the sound administration of judicial
resources warrant abstention under Colorado River. We
remand with instructions to stay the case pending resolution
of the state proceedings.
I. Background
The underlying administrative proceedings are complex,
but the details are largely unimportant here. What’s needed
is a basic understanding of the state regulatory framework
and the background of the federal and state litigation. We
assume familiarity with Driftless I and will be as brief as
possible, but some length cannot be avoided.
The plaintiffs are two Wisconsin environmental groups,
Driftless Area Land Conservancy and the Wisconsin Wildlife
Federation. They sued the Public Service Commission of
Wisconsin and its three commissioners—Rebecca Valcq,
Michael Huebsch, and Ellen Nowak. The intervenors are the
utility companies that hold the permit and will own and
operate the power line: American Transmission Company
LLC, ITC Midwest LLC, and Dairyland Power Cooperative
(we refer to them collectively as “the transmission compa-
nies”).
To place the sovereign-immunity and abstention issues in
context, some background about the regulatory scheme is
necessary. The Commission “has jurisdiction to supervise
and regulate every public utility” in Wisconsin. WIS. STAT.
§ 196.02(1). Its three commissioners are appointed by the
No. 20-3325 5
governor and confirmed by the state senate. One of the
Commission’s many duties is to regulate the construction of
high-voltage electricity transmission lines. Id. § 196.491(1)(e),
(3). With one irrelevant exception, transmission lines may be
constructed only if the Commission grants a permit known
as a “certificate of public convenience and necessity.” Id.
§ 196.491(3)(a)1. Although a permit is a prerequisite for
projects that require the use of eminent domain, the
Commission itself does not condemn the land needed for
construction. Rather, state law transfers the state’s eminent-
domain power to the utility once the permit has been ap-
proved. Id. § 32.02. That is, a utility company holding an
approved permit may use the condemnation power to
acquire the land needed to complete an approved project.
The permitting process is complex. The Commission may
grant a permit only if the transmission line is “in the public
interest.” Id. § 196.491(3)(d)3. An application commences a
highly technical inquiry. The Commission must consider a
multitude of factors such as the reliability of the power
supply, alternative sources of supply, economic factors,
engineering obstacles, safety, and environmental impact. Id.
The Commission’s role continues after it issues a permit. The
enabling statute is expansive and gives the Commission
sweeping jurisdiction to “supervise and regulate every
public utility in this state and to do all things necessary and
convenient to its jurisdiction.” Id. § 196.02(1). This includes
the power to file lawsuits, id. § 196.02(12), and to “rescind,
alter[,] or amend” a permit at any time, id. § 196.39(1).
The Commission also coordinates with the Midcontinent
Independent System Operator (“MISO”), a regional trans-
mission organization that operates interstate electricity grids
6 No. 20-3325
on behalf of its constituent utility companies. 1 MISO must
involve the Commission in all grid-expansion activities. See
18 C.F.R. § 35.34(k)(7). In order to coordinate with MISO, the
Commission delegates to one commissioner the authority to
represent it before MISO’s Advisory Committee and the
Board of the Organization of MISO States, a group that
represents the interests of state regulators. Commissioner
Huebsch was the Commission’s designated MISO repre-
sentative during the relevant period, and he also served as
secretary of the Organization of MISO States.
The events giving rise to the parallel state and federal lit-
igation began in April 2018 when the transmission compa-
nies applied for a permit to construct a 100-mile, high-
voltage power line stretching from Dane County in south-
central Wisconsin to Dubuque County in eastern Iowa. At a
projected cost of about $500 million, the power line would
serve the electricity needs of consumers in the southwestern
quadrant of the state. The application required the Commis-
sion to convene a class 1 “contested case” proceeding under
state administrative law. WIS. STAT. § 227.01(3)(a). More than
50 parties intervened, including Driftless and the Wildlife
Federation. On behalf of themselves and their members, they
opposed the project based on environmental and land-use
impacts.
After extensive proceedings and submissions, on
August 20, 2019, the Commission held an open meeting and
1 A regional transmission organization is a voluntary association of
utility companies that operates electrical grids on behalf of the utilities.
See Ill. Com. Comm’n v. Fed. Energy Regul. Comm’n, 721 F.3d 764, 769 (7th
Cir. 2013).
No. 20-3325 7
unanimously voted to conditionally grant the permit. A
month later the two environmental groups moved to dis-
qualify Commissioners Valcq and Huebsch based on alleged
conflicts of interest. On September 26, 2019, the Commission
issued a 112-page order finalizing and approving the permit.
The order addressed and rejected the recusal motion as
untimely, procedurally improper, and lacking a “factual
basis to support recusal.”
On December 11 Driftless and the Wildlife Federation
sued the Commission and the commissioners in federal
court in the Western District of Wisconsin seeking to invali-
date the permit. Two days later they filed two suits in state
court seeking the same relief under Chapter 227 of the
Wisconsin Statutes, which authorizes judicial review of state
administrative proceedings. See id. § 227.53. Within days
they intervened in a third judicial-review lawsuit filed by
another party. (From now on we refer to the two environ-
mental groups collectively as “Driftless.”)
The federal suit raises due-process and takings claims
under 42 U.S.C. § 1983. The first two counts center on allega-
tions that Commissioners Valcq and Huebsch had disquali-
fying conflicts of interest that required them to recuse
themselves from the permit proceeding. Count One alleges a
violation of due process. Count Two, styled as a violation of
“Due Process and Eminent Domain,” simply repackages the
due-process claim as an unconstitutional taking of private
property. This count adds nothing of legal significance;
allegations of adjudicator bias implicate the Due Process
Clause, not the Takings Clause, so Count Two can be ig-
nored. Count Three, a true Takings Clause claim, alleges that
8 No. 20-3325
the permit authorizes an unconstitutional taking of private
property for private use.
The conflict-of-interest allegations against Commissioner
Valcq stem from her career in the private sector. Prior to her
service on the Commission, Valcq was employed as in-house
and outside counsel for We Energies Corp. The parent
company of We Energies owns a 60% interest in American
Transmission Company, one of the permit applicants. The
conflict-of-interest allegations against Huebsch center on his
representation of the Commission on MISO, which inter-
vened in the permit proceedings in support of the project.
The complaint also accuses him of engaging in ex parte
communications with MISO representatives and other
interested parties.
The state lawsuits—including a fourth judicial-review
action—were consolidated in Dane County Circuit Court,
and the combined litigation raises a federal due-process
claim based on the same conflict-of-interest allegations
involving Commissioners Valcq and Huebsch. The state
litigation also invokes the right to an impartial adjudicator
under state law and raises unrelated violations of state
administrative and environmental law.
The opening act in the federal suit involved a disagree-
ment over the transmission companies’ right to intervene.
Our August 2020 decision in Driftless I authorized their
intervention, and on remand the case proceeded to decision
on a bevy of dismissal arguments. As relevant here, the
Commission, the commissioners, and the transmission
companies moved to dismiss the complaint based on sover-
eign immunity and the failure to state any cognizable consti-
tutional claim. Alternatively, they urged the judge to abstain
No. 20-3325 9
from exercising jurisdiction and stay the case based on the
ongoing state litigation, citing both Younger v. Harris,
401 U.S. 37 (1971), and Colorado River.
In November 2020 the judge issued a lengthy decision
dismissing the case in part and substantially trimming its
scope. First, he dismissed the case against the Commission
itself, explaining that state agencies, as arms of the state,
enjoy sovereign immunity from suit in federal court under
the Eleventh Amendment. Indeed, Driftless conceded its
mistake in suing the Commission and agreed that it must be
dismissed from the suit. The commissioners’ immunity
claim, however, was another matter; it was hotly contested.
State officials may be sued in federal court in their official
capacities notwithstanding the state’s sovereign immunity if
the Ex parte Young exception applies. Under that doctrine a
plaintiff may proceed in federal court against a state official
for the limited purpose of obtaining prospective relief
against an ongoing violation of federal law. The judge
concluded that Ex parte Young applies and declined to dis-
miss the suit against the commissioners on immunity
grounds.
The judge also denied the abstention request, ruling that
Younger abstention is inapplicable because the state case
doesn’t fit within the limited categories of cases covered by
the doctrine. He also ruled out Colorado River abstention. He
reasoned that the federal and state cases are not parallel in
the sense meant by Colorado River because the state litigation
does not raise a federal constitutional claim (or so he
thought, mistakenly).
10 No. 20-3325
Moving on to the arguments on the merits, the judge
dismissed Count Three—the takings claim—for failure to
state a claim. Under the broad contours of the Supreme
Court’s Takings Clause cases, see, e.g., Kelo v. City of New
London, 545 U.S. 469, 478–82 (2005), that claim is not remote-
ly plausible. As the judge explained, construction of a power
line is universally recognized as a constitutionally permissi-
ble public purpose for using eminent domain.
That left only the due-process claim based on the conflict-
of-interest allegations involving Commissioners Valcq and
Huebsch. The judge concluded that the conflict allegations
against them cleared the plausibility bar under the due-
process standard announced in Caperton v. A.T. Massey Coal
Co., 556 U.S. 868 (2009). But nothing in the complaint sug-
gests that Commissioner Nowak had a conflict of interest, so
the judge dismissed the case against her.
The judge’s sovereign-immunity ruling precipitated this
appeal. An order denying a claim of sovereign immunity is
immediately appealable, Richman v. Sheahan, 270 F.3d 430,
434 (7th Cir. 2001), so Valcq and Huebsch—the remaining
defendants—appealed the denial of their motion to dismiss
on immunity grounds. A stay is customary in this situation,
Allman v. Smith, 764 F.3d 682, 684 (7th Cir. 2014), so we
stayed the proceedings in the district court while the im-
munity appeal is pending. On August 26, 2021, Driftless
moved to partially lift the stay. We address that motion
below.
II. Discussion
We begin with an oddity in the case that complicates the
analysis of sovereign immunity and the Ex parte Young
No. 20-3325 11
exception. Huebsch resigned from the Commission in
February 2020, shortly after the suit was filed and long
before the judge ruled on the motion to dismiss. Inexplica-
bly, he remains a defendant in this official-capacity suit even
though he is out of office and no relief can be ordered
against him. Under Rule 25(d) of the Federal Rules of Civil
Procedure, when a public officer is sued in his official capac-
ity and resigns from office while the suit is pending, his
successor is automatically substituted. Tyler Huebner suc-
ceeded Heubsch in March 2020, but the substitution did not
occur.
As the case comes to us, then, Valcq is the only defendant
against whom an injunction could possibly issue. And that
raises an anomaly in the district court’s Ex parte Young
analysis. An injunction against Valcq—one member of a
three-member commission—would be pointless. We can fix
the problem by applying Rule 43(c)(2) of the Federal Rules of
Appellate Procedure, which like Rule 25(d) requires the
substitution of the current officeholder. We therefore substi-
tute Commissioner Huebner for Huebsch.
But that’s not the only complication. There are notable
gaps in the information we’ve received from the parties
about the status of the concurrent state proceedings. While
this appeal has been pending, significant developments have
occurred in the state litigation. The parties alerted us to this
information only very recently in their briefs supporting and
opposing the August 26 motion to partially lift the stay. Even
then, however, they omitted some important details.
Here’s what we’ve pieced together from the public record
and the parties’ filings on the motion to lift the stay. On
January 21, 2021—a month before this appeal was argued—
12 No. 20-3325
the judge presiding in the consolidated judicial-review
proceedings in Dane County held a lengthy hearing and
ruled that Commissioner Valcq’s prior representation of We
Energies was not a disqualifying conflict of interest and did
not trigger a due-process duty to recuse. The judge accord-
ingly rejected Driftless’s request for discovery on those
allegations and said he was “throwing out any challenge to
Commissioner Valcq.” Hearing Transcript (Jan. 21, 2021),
Affidavit of Brian H. Potts in Response to Motion to Lift Stay,
Ex. 2 at 77, No. 20-3325, ECF No. 64-2. The judge reached the
opposite conclusion regarding Huebsch, ruling that the
conflict-of-interest allegations against him were enough to
state a prima facie case of an appearance of improper bias.
Id. at 77–79. The judge therefore authorized discovery on the
recusal question involving Huebsch and directed the parties
to propose a discovery plan. They did so. On May 25 the
judge issued a written order memorializing his oral rulings
and setting a discovery schedule. County of Dane v. Pub. Serv.
Comm’n of Wis., No. 2019CV003418 (Wis. Cir. Ct. Dane Cnty.
May 25, 2021) (decision and order).
Some procedural skirmishes ensued, and by July the liti-
gation over Huebsch’s alleged conflict of interest had moved
to the court of appeals. More procedural maneuvering
followed, and by the end of the summer, the case landed at
the Wisconsin Supreme Court’s doorstep. On September 21
the state high court granted Huebsch’s petition for expedited
review and set a briefing schedule. County of Dane v. Pub.
Serv. Comm’n of Wis., No. 2021AP1321-LV (Wis. Sept. 21,
2021) (order granting expedited review). The petition raises
threshold procedural questions and several substantive
questions about the legal standards for evaluating recusal
issues under Caperton and state law and the proper applica-
No. 20-3325 13
tion of those standards to the allegations involving Huebsch.
The Dane County proceedings are stayed while the case is
pending before the state supreme court. 2
There is more. On June 28 the transmission companies
returned to the Commission and asked it to reopen the
permit proceedings on its own motion to rescind and recon-
sider the permit based on the conflict-of-interest allegations
regarding Heubsch. On July 1 the Commission issued a
notice of intent to rescind the permit and invited comments
by July 19. Notice of Intent and Request for Comments,
Cardinal-Hickory Creek Project, Pub. Serv. Comm’n of Wis.,
No. 5-CE-146, Ref# 415003 (July 1, 2021), https://apps.psc.
wi.gov/ERF/ERFview/viewdoc.aspx?docid=415003. A hear-
ing was held on July 29; the minutes reflect that the Com-
mission discussed the matter but took no action. Id., Minutes
and Informal Instructions of the Open Meeting of Thursday,
July 29, 2021, Ref# 418174 (Aug. 5, 2021), https://apps.psc.wi.
gov/ERF/ERFview/viewdoc.aspx?docid=418174.
As best we can tell, that’s where things stand in the state
courts and before the Commission. These important devel-
opments inform the abstention inquiry, to which we’ll turn
in a moment. But sovereign immunity is our first issue. It is a
2 Yesterday Driftless notified us of additional events in the state case. On
October 8 Driftless filed an emergency motion for injunctive relief
blocking construction activity—the same relief it wanted to pursue in the
district court if its motion to lift the stay in this case were successful. On
October 12 the Dane County judge stayed the proceedings pending a
decision by the Wisconsin Supreme Court, but on October 18 he nonethe-
less held a telephonic hearing on the emergency motion and orally
granted it. The docket reflects that he is currently considering a motion
to stay his order pending appeal.
14 No. 20-3325
jurisdictional defense. See, e.g., Gorka v. Sullivan, 82 F.3d 772,
774 (7th Cir. 1996) (describing sovereign immunity as a
“jurisdictional bar”); Crosetto v. State Bar of Wis., 12 F.3d 1396,
1400 (7th Cir. 1993) (labeling “state sovereign immunity” as
“one of the Constitution[’s] unavoidable jurisdictional
hurdles”).
A. Sovereign Immunity
“Sovereign immunity is the privilege of the sovereign not
to be sued without its consent” and is secured to the states
by the Eleventh Amendment. Va. Off. for Prot. & Advoc. v.
Stewart, 563 U.S. 247, 253 (2011). As the Supreme Court has
explained, the Eleventh Amendment “confirm[s] the struc-
tural understanding that States entered the Union with their
sovereign immunity intact, unlimited by Article III’s juris-
dictional grant.” Id.The text of the Amendment provides: “The Judicial pow-
er of the United States shall not be construed to extend to
any suit in law or equity, commenced or prosecuted against
one of the United States by Citizens of another State.”
U.S. CONST. amend. XI. Although this language does not “by
its terms … bar suits against a State by its own citizens,” the
Supreme Court “has consistently held that an unconsenting
State is immune from suits brought in federal courts by her
own citizens as well as by citizens of another State.” Edelman
v. Jordan, 415 U.S. 651, 662–63 (1974). “[I]f properly raised,
the [A]mendment bars actions in federal court against a
state, state agencies, or state officials acting in their official
capacities.” Council 31 Am. Fed’n of State, Cnty. & Mun. Emps.
v. Quinn, 680 F.3d 875, 881 (7th Cir. 2012) (quotation marks
omitted).
No. 20-3325 15
But “sovereign immunity is not absolute immunity.” Id.
at 882. The doctrine of Ex parte Young, 209 U.S. 123 (1908),
creates an exception to state sovereign immunity “by assert-
ing that a suit challenging the constitutionality of a state
official’s action in enforcing state law is not one against the
State.” Green v. Mansour, 474 U.S. 64, 68 (1985). The doctrine
is “accepted as necessary to permit the federal courts to
vindicate federal rights.” Stewart, 563 U.S. at 254–55 (quota-
tion marks omitted). “It rests on the premise—less delicately
called a ‘fiction’—that when a federal court commands a
state official to do nothing more than refrain from violating
federal law, he is not the State for sovereign-immunity
purposes.” Id. at 255 (cleaned up).
But Ex parte Young is “limited to that precise situation.”
Id. It applies only when a plaintiff seeks prospective relief
against an ongoing violation of federal law. Idaho v. Coeur
d’Alene Tribe of Idaho, 521 U.S. 261, 281 (1997). Accordingly,
our task is to “conduct a straightforward inquiry into
whether [the plaintiffs’] complaint alleges an ongoing viola-
tion of federal law and seeks relief properly characterized as
prospective.” Verizon Md., Inc. v. Pub. Serv. Comm’n of Md.,
535 U.S. 635, 645 (2002) (quotation marks omitted).
1. Prospective Relief
Analyzing the form of relief is the simpler part of the in-
quiry. Injunctive relief is prospective relief. See Coeur d’Alene,
521 U.S. at 277 (“[W]e have consistently allowed suits seek-
ing prospective injunctive relief based on federal violations
to proceed.”); Hutto v. Finney, 437 U.S. 678, 690 (1978)
(“[S]tate officers are not immune from prospective injunctive
relief.”); Edelman, 415 U.S. at 664 (“[T]he relief awarded in Ex
parte Young was prospective only; the Attorney General of
16 No. 20-3325
Minnesota was enjoined to conform his future conduct of
that office to the requirement of the Fourteenth Amend-
ment.”). It’s usually easy to separate suits for prospective
relief from those that seek retroactive remedies; the latter
primarily take the form of monetary damages to remedy
past harms. See McDonough Assocs. v. Grunloh, 722 F.3d 1043,
1050–51 (7th Cir. 2013) (explaining that courts cannot “direct
a state to make payments … to remedy a past injury to a
private party”); MSA Realty Corp. v. Illinois, 990 F.2d 288, 291
(7th Cir. 1993) (“The [E]leventh [A]mendment bar extends to
suits for money damages against state officials sued in their
official capacities … .”).
Here, Driftless seeks (1) a declaration that Valcq and
Huebsch had a due-process duty to recuse themselves from
the permit proceeding; (2) a declaration that the permit is
void as a matter of law; (3) an order vacating the permit; and
(4) an injunction barring the enforcement of the permit.
Declaratory and injunctive relief are paradigmatic examples
of prospective relief. See Alden v. Maine, 527 U.S. 706, 747
(1999) (recognizing that Ex parte Young allows “certain suits
for declaratory or injunctive relief against state officers” to
proceed in federal court). But vacatur of the permit is retro-
spective. Although an injunction and vacatur have similar
real-world effects in that each will prevent construction of
the power line, the two forms of relief have different legal
consequences.
A federal injunction does not erase an unconstitutional
state law from existence; federal courts cannot repeal state
laws. See Borden v. United States, 141 S. Ct. 1817, 1835 (2021)
(Thomas, J., concurring) (“Courts have no authority to ‘strike
down’ statutory text.” (cleaned up)); Skilling v. United States,
No. 20-3325 17
561 U.S. 358, 424 (2010) (Scalia, J., concurring in part) (“I
continue to doubt whether ‘striking down’ a statute is ever
an appropriate exercise of our Article III power.”). Rather, a
federal injunction prevents state officials from enforcing the
challenged statute, regulation, or agency action in the future
based on its incompatibility with federal law. An injunction
operates on the enjoined officials; the law, regulation, or
agency action remains on the books, and if the injunction is
lifted by the issuing court, overturned by a higher court, or
superseded by federal law, it resumes effect. See generally
Jonathan F. Mitchell, The Writ-of-Erasure Fallacy, 104 VA. L.
REV. 933 (2018).
Vacatur, in contrast, retroactively undoes or expunges a
past state action. Vacatur is “[t]he act of annulling or setting
aside.” BLACK’S LAW DICTIONARY (11th ed. 2019). Unlike an
injunction, which merely blocks enforcement, vacatur un-
winds the challenged agency action. Ex parte Young does not
encompass retroactive remedies like vacatur—and for good
reason: the federal judiciary is not an oversight board over
state agencies and has no power to vacate the actions of state
agencies. That power belongs to the state courts, WIS. STAT.
§ 227.57(5), or the agency itself.
Still, the complaint’s request for injunctive relief brings
this case within Ex parte Young—provided, however, that
Driftless has plausibly alleged an ongoing violation of
federal law.
2. Ongoing Violation
The more challenging aspect of Ex parte Young analysis is
the proviso that the suit must seek relief against an “ongo-
ing” violation of federal law. An ongoing violation of federal
18 No. 20-3325
law is one that is “continuing.” Green, 474 U.S. at 68. Because
Ex parte Young is limited to federal-court orders “granting
prospective injunctive relief to prevent a continuing viola-
tion of federal law,” the doctrine does not apply when
“federal law has been violated [only] at one time or over a
period of time in the past.” Papasan v. Allain, 478 U.S. 265,
277–78 (1986). This part of the inquiry may seem simple at
first, but “the difference between the type of relief barred by
the Eleventh Amendment and that permitted under Ex parte
Young will not in many instances be that between day and
night.” Edelman, 415 U.S. at 667.
This case lies in that twilight zone. It presents a difficult
question of first impression: Is there an ongoing violation of
federal law when the alleged violation is a procedural error
committed by a state actor at a discrete point in time? The
commissioners argue that the due-process violation (if there
was one) was complete when the permit was approved and
thus cannot be considered “ongoing” for purposes of Ex
parte Young. Driftless insists that the violation is ongoing so
long as the permit remains in force and effect and the
Commission continues to exercise jurisdiction over the
transmission companies in the present by virtue of its power
to enforce, amend, or rescind the permit.
Three cases are instructive here, although none is precise-
ly on point. The first is Verizon v. Public Service Commission of
Maryland. There, the telecommunications carrier Verizon
negotiated an interconnection agreement with its competitor
WorldCom as required by federal law. The state agency with
jurisdiction over the matter approved the agreement, but a
few months later, WorldCom filed a complaint with the
agency accusing Verizon of violating the agreement. The
No. 20-3325 19
agency ruled in favor of WorldCom on grounds pertaining
to state contract law. Verizon then filed a federal lawsuit
against the agency’s commissioners in their official capaci-
ties alleging that the agency’s order was preempted by the
Telecommunications Act of 1996 and a recent FCC ruling.
Verizon, 535 U.S. at 639–40. The Supreme Court held that the
Eleventh Amendment did not bar Verizon’s suit. Id. at 635.
Verizon’s prayer for injunctive relief asked the federal court
to enjoin the state officials “from enforcing the order in
contravention of controlling federal law.” Id. at 645. That
was sufficient to bring the case within Ex parte Young. Id.The second relevant precedent is MCI Telecommunications
Corp. v. Illinois Bell Telephone Co., 222 F.3d 323 (7th Cir. 2000),
another telecommunications case, though one from this
court. There, the Illinois and Wisconsin utility commissions
arbitrated several interconnection agreements between
telecommunications companies. One of them sued the
commissioners in their official capacities claiming that the
approved agreements violated the Telecommunications Act.
The commissioners raised sovereign immunity, arguing that
“if any violations occurred, they occurred in the past,” so Ex
parte Young did not apply. Id. at 345. We disagreed, observ-
ing that the “challenged determinations are still in place, and
the [plaintiffs] seek to have the commissioners conform their
future actions, including their continuing enforcement of the
challenged determinations, with federal law.” Id.The final case is Town of Barnstable v. O’Connor, 786 F.3d
130 (1st Cir. 2015), which involved a challenge to a state
agency’s energy policy. A Massachusetts utility commission
approved a merger between two electricity companies. The
Town of Barnstable, joined by an environmental group and
20 No. 20-3325
several other plaintiffs, filed a federal suit alleging that the
merger was incompatible with the Federal Power Act and
also violated the dormant Commerce Clause. Citing Verizon,
the First Circuit rejected the commissioners’ claim of sover-
eign immunity. The court held in relevant part that “the
continued enforceability of the [merger agreement] repre-
sents an ongoing violation of federal law because [it] binds
the parties to abide by the [agreement’s] allegedly unconsti-
tutional terms.” Id. at 139.
At first glance these cases seem closely analogous to this
one. But there is a distinction. Each of these cases raised a
substantive violation of federal law: the challenged state-
agency determinations authorized the regulated parties to
conduct their ongoing activities in violation of an FCC order,
the Telecommunication Act, and the Federal Power Act and
Commerce Clause, respectively. In contrast, this case raises a
discrete procedural violation: the alleged due-process error
occurred when commissioners with disqualifying conflicts of
interest approved the power-line permit. In other words,
Driftless does not assert that the permit substantively violates
federal law (at least not in this suit); it challenges only the
process by which the permit was issued.
In the end, we’re not convinced that the difference be-
tween substance and procedure is decisive. As the First
Circuit observed in Town of Barnstable, the “continued en-
forceability” of an unlawful state-agency decision can
amount to an ongoing violation of federal law. Nothing in
Ex parte Young or its successors suggests that the distinction
between substantive and procedural violations makes a
difference, so we hesitate to draw that line here. The relevant
inquiry is whether the suit seeks prospective relief against an
No. 20-3325 21
ongoing violation of federal law. A permit issued in viola-
tion of due process remains unlawful as long as it is in force
and effect.
The commissioners point to Sonnleitner v. York, 304 F.3d
704 (7th Cir. 2002), which has surface similarity to this case—
it too involved a due-process claim—but on close review is
distinguishable. Sonnleitner involved a suit by a state em-
ployee who was demoted without a predisciplinary hearing.
He later prevailed at a postdeprivation hearing but was not
reinstated, in part due to his own procedural missteps. He
then sued his supervisors in federal court seeking an injunc-
tion reinstating him to his position. He alleged that the
denial of a predisciplinary hearing violated his right to due
process. We held that the claim was barred by sovereign
immunity. Id. at 718. Because the plaintiff was “eventually
given an opportunity to tell his side of the story” at the
postdeprivation hearing, we concluded that his due-process
claim concerned “at most, a past rather than an ongoing
violation of federal law.” Id.Our holding in Sonnleitner turned on the fact that the
plaintiff had received a postdeprivation hearing that com-
plied with due-process requirements. After the postdepriva-
tion hearing, the alleged error in the predeprivation process
could not be characterized as “ongoing.” The due-process
violation at issue here is different. Driftless contends that the
Commission’s approval of the permit was tainted by adjudi-
cator bias in violation of the Due Process Clause.
Finally, the commissioners argue that if this case is al-
lowed to proceed under Ex parte Young, then all manner of
final state-agency rulings will suddenly become reviewable
in federal court based on allegations of adjudicator bias. This
22 No. 20-3325
would complicate state judicial review of agency rulings and
erode state sovereign immunity. It could also open the
floodgates to federal suits by parties complaining about
biased state administrative adjudicators.
We are sensitive to these concerns. Federal courts are not
oversight boards designed to police the final actions of state
agencies. Cf. River Park, Inc. v. City of Highland Park, 23 F.3d
164, 165 (7th Cir. 1994) (“Federal courts are not boards of
zoning appeals.”). Challenges to state administrative actions
usually belong in state courts, which are interested in and
fully capable of ensuring that state agencies comply with
federal due-process requirements. See Coeur d’Alene, 521 U.S.
at 276 (“Where, as here, the parties invoke federal principles
to challenge state administrative action, the courts of the
State have a strong interest in integrating those sources of
law within their own system for the proper judicial control
of state officials.”).
At bottom, these concerns rest on federalism principles.
State sovereign immunity is, of course, rooted in the anchor-
ing structure of our system of federalism. So too, however, is
abstention doctrine. The commissioners’ arguments about
federalism and comity are valid, but we think they are better
addressed by abstention doctrine. For the foregoing reasons,
we conclude that the due-process claim against them satis-
fies the requirements of Ex parte Young and now move to the
abstention question.
B. Abstention
The commissioners also asked the district judge to ab-
stain and stay this case to await the outcome of the state
litigation, citing both Younger and Colorado River abstention.
No. 20-3325 23
The judge denied the request. We see no flaw in the judge’s
analysis of Younger, but his Colorado River ruling rests on a
misunderstanding of the claims in the state litigation, which
in turn led him to mistakenly conclude that the federal and
state cases are not parallel within the meaning of the doc-
trine.
1. Raising Abstention Sua Sponte
The abstention issue is not formally before us, but the
Supreme Court has held that a reviewing court may raise
abstention sua sponte in an appropriate case. See Bellotti v.
Baird, 428 U.S. 132, 143 n.10 (1976) (“[T]he fact that the full
arguments in favor of abstention may not have been asserted
in the District Court does not bar this Court’s consideration
of the issue.”). We have done so at least twice before, though
the cases are a bit dated.
We raised abstention sua sponte in Waldron v. McAtee,
723 F.2d 1348 (7th Cir. 1983), citing Bellotti and noting that a
reviewing court has “the power and in an appropriate case
the duty to order abstention, if necessary for the first time at
the appellate level, even though no party is asking for it.” Id.
at 1351. We explained that abstention doctrines do not exist
“to protect the rights of one of the parties” but instead to
“promote a harmonious federal system.” Id. We later charac-
terized Waldron as recognizing a clear rule that “appellate
courts are free to raise and resolve the abstention issue sua
sponte.” Gen. Ry. Signal Co. v. Corcoran, 921 F.2d 700, 708 (7th
Cir. 1991) (citing Waldron, 723 F.2d at 1351).
We also raised abstention sua sponte in In re Complaint of
McCarthy Brothers Co., 83 F.3d 821 (7th Cir. 1996), a compli-
cated admiralty action involving an ironworker who was
24 No. 20-3325
injured while working on a barge on the Mississippi River.
Admiralty law has its own arcane abstention doctrine
known as Langnes abstention, which advises federal courts to
“permit[] proceedings in state court to go forward on the
question of liability and retain[] jurisdiction over any ques-
tion that might arise as to the shipowner’s right to limit his
liability.” Id. at 828 (describing Langnes v. Green, 282 U.S. 531(1931)). Though no one argued the point, we decided “to
raise the issue of abstention sua sponte,” explaining that
reversal for application of Langnes abstention was necessary
to correct the district court’s error and facilitate the “opera-
tion of the complicated admiralty jurisdictional rules.” Id. at
826.
This too is an appropriate case in which to raise absten-
tion sua sponte. The error in the judge’s Colorado River ruling
is plain, and our concerns about federal interference in
ongoing state litigation justify taking this step. In so doing
we follow the lead of our colleagues in the First Circuit. See
Jiménez v. Rodríguez-Pagán, 597 F.3d 18, 27 n.4 (1st Cir. 2010)
(“As with other forms of abstention, our decision to decline
jurisdiction under Colorado River may be sua sponte.”).
2. Colorado River Abstention
We begin with first principles. Although abstention “is
the exception, not the rule,” Colorado River, 424 U.S. at 813, “a
federal court may, and often must, decline to exercise its
jurisdiction where doing so would intrude upon the inde-
pendence of the state courts and their ability to resolve the
cases before them,” SKS & Assocs., Inc. v. Dart, 619 F.3d 674,
677 (7th Cir. 2010). The main categories of abstention are
known by the names of the Supreme Court cases that creat-
No. 20-3325 25
ed them: Pullman, Burford, Younger, and Colorado River. 3
These categories are not rigid, however. The animating force
of the Court’s abstention cases is that “they all implicate (in
one way or another and to different degrees) underlying
principles of equity, comity, and federalism foundational to
our federal constitutional structure.” J.B. v. Woodard, 997 F.3d
714, 722 (7th Cir. 2021).
Under the doctrine announced in Colorado River, a federal
court may abstain and stay or dismiss a suit in deference to
parallel state proceedings in exceptional circumstances
where abstention would promote “wise judicial administra-
tion.” 424 U.S. at 818. Several prudential principles are
embedded in this highly generalized statement of the doc-
trine. Among them are the interest in conserving judicial
resources, the desirability of avoiding duplicative litigation
and the risk of conflicting rulings, and the benefits of pro-
moting a comprehensive disposition of the parties’ dispute
in a single judicial forum. Id.We have found it useful to approach Colorado River ab-
stention in two steps. DePuy Synthes Sales, Inc. v. OrthoLA,
Inc., 953 F.3d 469, 477 (7th Cir. 2020). “The first question is
whether the concurrent state and federal actions are actually
parallel. If so, the second question is whether the necessary
exceptional circumstances exist to support” abstention. Id.(cleaned up).
“Two suits are considered parallel when substantially the
same parties are contemporaneously litigating substantially
3R.R. Comm’n of Tex. v. Pullman Co., 312 U.S. 496 (1941); Burford v. Sun Oil
Co., 319 U.S. 315 (1943); Younger v. Harris, 401 U.S. 37 (1971); Colo. River
Water Conservation Dist. v. United States, 424 U.S. 800 (1976).
26 No. 20-3325
the same issues in another forum. Formal symmetry is
unnecessary, as long as there is a substantial likelihood that
the state litigation will dispose of all claims presented in the
federal case.” Id. at 477–78 (cleaned up). On this understand-
ing, there is no doubt that the state and federal suits here are
parallel.
True, the suits are not completely identical: the state litiga-
tion raises state-law issues in addition to the duplicative
due-process claim. But perfect symmetry isn’t necessary. The
cases are parallel in all the ways that matter under Colorado
River. The due-process recusal claims “involve the same
parties, the same facts, and the same issues.” Id. at 478.
Indeed, the claims are materially identical: they will “be
resolved by examining largely the same evidence,” Huon v.
Johnson & Bell, Ltd., 657 F.3d 641, 647 (7th Cir. 2011), and are
governed by the legal standard announced in Caperton. So
it’s not just “substantially likely” that the state litigation will
dispose of the federal case—it is nearly certain that it will do
so.
The second step in the framework is to determine wheth-
er exceptional circumstances justify abstention. A plethora of
nonexclusive, unweighted factors can inform this question,
including:
1. Whether the case concerns rights in prop-
erty, and if so, whether the state has as-
sumed jurisdiction over that property;
2. The inconvenience of the federal forum;
3. The desirability of consolidating litigation
in one place (put otherwise, the value in
avoiding “piecemeal” or broken-up pro-
ceedings);
No. 20-3325 27
4. The order in which jurisdiction was ob-
tained in the concurrent fora;
5. The source of governing law—federal or
state;
6. The adequacy of the state-court action to
protect the federal plaintiff’s rights;
7. The relative progress of the state and fed-
eral proceedings;
8. The presence or absence of concurrent ju-
risdiction;
9. The availability of removal; and
10. Whether the federal action is vexatious or
contrived.
DePuy, 953 F.3d at 477. We have cautioned that this overa-
bundant list of factors “is designed to be helpful, not a
straitjacket. Different considerations may be more pertinent
to some cases, and one or more of these factors will be
irrelevant in other cases.” Loughran v. Wells Fargo Bank, N.A.,
2 F.4th 640, 647 (7th Cir. 2021). Nor does the list “preclude
the district court from taking into account a special charac-
teristic of the case before it.” DePuy, 953 F.3d at 477.
More generally, the decision to abstain “does not rest on
a mechanical checklist, but on a careful balancing of the
important factors.” Moses H. Cone Mem’l Hosp. v. Mercury
Constr. Corp., 460 U.S. 1, 16 (1983). In short, abstention law
doesn’t demand an exact fit with the precise parameters of a
doctrinal category. J.B., 997 F.3d at 723–24. Instead, the
abstention inquiry is flexible and requires a practical judg-
ment informed by principles of comity, federalism, and
sound judicial administration.
28 No. 20-3325
With these principles in mind, we find it neither neces-
sary nor helpful to march through our 10-factor “test” and
decide which factors support abstention and which do not.
DePuy, 953 F.3d at 479 (explaining that the factors in a multi-
factor, unweighted test often point in different directions);
see also United States v. Mayfield, 771 F.3d 417, 435 (7th Cir.
2014) (en banc) (“Multifactor tests are common in our law
but they can be cryptic when unattached to a substantive
legal standard, as this one is. Knowing what factors to look
at is useless unless one knows what to look for.”).
Several compelling considerations justify abstention in
this case, and all can be loosely keyed to the factors on the
list. The first is the desirability of avoiding piecemeal litiga-
tion over the legality of the power-line permit. Multi-
jurisdictional legal challenges involving the same subject
matter are costly, disruptive, and run the risk of a collision of
conflicting rulings. A related consideration is the wholly
duplicative nature of this suit. The takings claim was
doomed from the start and can fairly be characterized as
contrived, and there is no good reason to litigate identical
due-process recusal claims in state and federal court. See
Interstate Material Corp. v. City of Chicago, 847 F.2d 1285, 1289
(7th Cir. 1988) (holding that a federal lawsuit “could be
considered” contrived when the plaintiff files parallel suits
“seeking substantially the same relief from substantially the
same parties”).
Needless to say, the state courts routinely apply federal
constitutional standards, as they must under the Supremacy
Clause. More to the point here, Wisconsin courts are fully
capable of applying Caperton and have begun to do so. See In
re Paternity of B.J.M., 944 N.W.2d 542, 549 (Wis. 2020). And
No. 20-3325 29
they have long applied federal due-process standards to
recusal questions involving administrative adjudicators. See
Guthrie v. Wis. Emp. Rels. Comm’n, 331 N.W.2d 331, 336 (Wis.
1983). So there is nothing about this particular legal context
that cautions against abstention. To the contrary, it appears
that Driftless simply wants two bites at the apple. And that
weighs heavily in favor of abstention.
What’s more, the state case has advanced toward a reso-
lution of the due-process claim. As we’ve explained, the
Dane County judge already ruled against Driftless on its
allegations against Valcq. The allegations involving Huebsch
remain, but the case is now before the Wisconsin Supreme
Court on that issue. The petition for review raises substan-
tive questions about the application of Caperton—both in
general and in light of the specific allegations involving
Huebsch. Under these circumstances, the use of federal
judicial resources to decide the same questions cannot be
justified. “The principal purpose of a stay under Colorado
River is judicial economy … .” Schneider Nat’l Carriers, Inc. v.
Carr, 903 F.2d 1154, 1157 (7th Cir. 1990). There is “no reason
for identical suits to be proceeding in different courts.”
U.S.O. Corp. v. Mizuho Holding Co., 547 F.3d 749, 750 (7th Cir.
2008). Judicial economy strongly favors abstention.
That brings us to a final consideration, and it is far from
the least important one. Although Colorado River abstention
is primarily concerned with judicial economy, it also imple-
ments the fundamental federalism principles that animate all
abstention categories. See, e.g., Adkins v. VIM Recycling, Inc.,
644 F.3d 483, 486 (7th Cir. 2011) (describing Colorado River as
a “federalism doctrine”); Black Sea Inv., Ltd. v. United Heritage
Corp., 204 F.3d 647, 650 (5th Cir. 2000) (“The Colorado River
30 No. 20-3325
abstention doctrine is based on principles of federalism,
comity, and conservation of judicial resources.”).
Federalism concerns loom large here. This case impli-
cates Wisconsin’s sovereign interest in the proper function-
ing of its administrative law and procedure and the role of
the state courts in reviewing the decisions of administrative
agencies. Wisconsin has created an elaborate permitting
regime for important public-utility projects like this one, and
aggrieved persons are entitled to judicial review in the state
courts. See generally WIS. STAT. § 227.53. Only the state courts
can review the agency’s work for compliance with the
procedural and substantive requirements of state law. And
the state courts alone have the authority to vacate the permit
and order the Commission to conduct a new hearing—
whether as a remedy for a violation of state law or as a
remedy for a violation of the federal constitutional guarantee
of due process.
Conversely, there is no significant federal interest at
stake here that necessitates or even encourages federal-court
review of the procedural regularity of the permit proceeding
before the agency. A foundational premise of our federalism
is “the assumption that state courts are co-equal to the
federal courts and are fully capable of respecting and pro-
tecting” federal constitutional rights. Courthouse News Serv.
v. Brown, 908 F.3d 1063, 1074 (7th Cir. 2018). “Principles of
comity entitle the states to make their own decisions, on
federal issues as well as state issues, unless there is some
urgent need for federal intervention.” Nicole K. ex rel. Linda
R. v. Stigdon, 990 F.3d 534, 537–38 (7th Cir. 2021). The federal
courts have no institutional superiority in ruling on Caperton
No. 20-3325 31
claims. 4 Accordingly, “[e]xercising federal jurisdiction over
[this] claim[] would reflect a lack of respect for the state’s
ability to resolve the[] issues properly before its courts.” J.B.,
997 F.3d at 722 (quotation marks omitted).
Finally, the recent developments before the agency are
worth mentioning. As we’ve noted, the Commission recently
reopened its proceedings to determine whether to rescind
and reconsider the permit based on the conflict-of-interest
allegations involving Huebsch. Of course, we cannot predict
what it will do. But if the Wisconsin Supreme Court rules in
favor of Driftless and allows the due-process claim to move
forward in Dane County Circuit Court, remedial steps by the
Commission would not be surprising.
In short, abstention under Colorado River is amply justi-
fied. The judge was wrong to conclude otherwise.
III. Conclusion
For the foregoing reasons, the judge correctly denied the
commissioners’ motion to dismiss based on sovereign
immunity. But he incorrectly denied the motion for Colorado
4 By our count, we have addressed Caperton claims in just five reported
cases: Gacho v. Wills, 986 F.3d 1067, 1071–76 (7th Cir. 2021); United States v.
Williams, 949 F.3d 1056, 1061–63 (7th Cir. 2020); Wozniak v. Adesida,
932 F.3d 1008, 1011 (7th Cir. 2019); Alston v. Smith, 840 F.3d 363, 368–69
(7th Cir. 2016); and Suh v. Pierce, 630 F.3d 685, 691–92 (7th Cir. 2011).
Another four make passing reference to Caperton: Trustmark Ins. Co. v.
John Hancock Life Ins. Co., 631 F.3d 869, 872 (7th Cir. 2011); Bauer v.
Shepard, 620 F.3d 704, 712 (7th Cir. 2010); Siefert v. Alexander, 608 F.3d 974,
980 (7th Cir. 2010); and Chen v. Holder, 607 F.3d 511, 513 (7th Cir. 2010).
Not that case counts matter. The Wisconsin Supreme Court is equally
capable of applying Caperton, even if it has done so less frequently than
this court.
32 No. 20-3325
River abstention. We therefore REVERSE and REMAND with
instructions to stay this case pending dispositive develop-
ments in the state litigation. The motion to partially lift the
stay pending appeal is denied as moot.