Palermo v. Town of North Reading

Not for Publication in West's Federal Reporter
United States Court of Appeals
For the First Circuit
No. 09-1049
JOHN PALERMO; JULIE PALERMO,
Plaintiffs, Appellants,
v.
TOWN OF NORTH READING,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Rya W. Zobel, U.S. District Judge]
Before
Boudin, Stahl, and Lipez, Circuit Judges.
Mark J. Favaloro, with whom Favaloro & Associates was on
brief, for appellants.
Judy A. Levenson, with whom Deidre Brennan Regan and Brody,
Hardoon, Perkins & Kesten, LLP, were on brief, for appellee.
April 9, 2010
STAHL, Circuit Judge. Plaintiffs-appellants John and
Judy Palermo ("the Palermos") brought an amended complaint against
the Town of North Reading ("the Town") alleging an unconstitutional
taking of property and violation of their civil rights as protected
by 42 U.S.C. § 1983 and the Massachusetts Civil Rights Act. The
district court dismissed the complaint in its entirety for failure
to state a claim under Federal Rule of Civil Procedure 12(b)(6).
The Palermos only appeal the dismissal of their federal civil
rights claim brought pursuant to § 1983. After careful
consideration we affirm.
In 1987, the Palermos purchased three lots of land in
North Reading, Massachusetts, and thereafter, in 1997, sought a
building permit for those lots. The Town's building inspector
denied the permit, requiring that construction of the street upon
which the lots were located be completed first. The Palermos
alleged that from 1997 to 2005, the Town allowed other property
owners to develop similar lots on unaccepted streets1 while denying
them the same ability. In 2004, the Palermos petitioned the Town's
Community Planning Commission to build out the adjacent street as
an unaccepted street. The Town's Planner denied that request,
indicating that "a complete subdivision plan would be necessary."
The Palermos alleged that this treatment was contrary to the
1
An unaccepted street is a public right of way that has not
been built to municipal standards.
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treatment received by other property owners in the Town. In 2005,
the Palermos learned that the Town's Board of Selectman had voted
to take their land by eminent domain and that they would be given
a pro tanto award of $15,250, an amount that the Palermos believed
was significantly lower than the market value of the land.
The Palermos filed suit in state court seeking, among
other things, just compensation for the Town's eminent domain
taking pursuant to Massachusetts General Law ch. 79. The Town
removed the action to federal court and the parties subsequently
filed a joint motion to stay the federal action and allow the
Palermos to pursue their state law eminent domain claim in state
court. In the state court proceeding, the Town filed a pretrial
motion stating that it expected its appraiser to testify that the
Palermos' property was either unbuildable or effectively
unbuildable due to significant regulatory and physical hurdles that
would have to be overcome in order to obtain a building permit on
the property. However, at trial, the appraiser testified that the
property was buildable and that the market value was $140,000. The
jury returned a verdict in favor of the Palermos for $184,000.
Following the favorable state jury verdict, the Palermos
returned to federal court and filed a motion to reopen their
federal action. The district court was uncertain as to what, if
anything, remained of the case following the jury verdict, and
ordered the Palermos to file an amended complaint. The Palermos'
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amended complaint asserted two counts against the Town: (1)
violation of the Fifth Amendment of the U.S. Constitution and
Articles X and XII of the Massachusetts Constitution due to an
unconstitutional taking of the Palermos' property; and (2) "bad
faith" by the Town, which allegedly violated the Palermos' civil
rights as protected by 42 U.S.C. § 1983 and the Massachusetts Civil
Rights Act. Count Two's "bad faith" charge was based on the Town's
denial of the building permit and its offer of a "de minimis" pro
tanto award in spite of the appraiser's significantly higher
valuation.
Count Two did not state which of the Palermos' civil
rights the Town was alleged to have violated. In addition, Count
Two only referred to acts committed by agents and employees of the
Town, rather than acts committed by the Town itself. Finally,
Count Two contained no allegation that the alleged civil rights
violations were the result of a policy, practice, or custom of the
Town.
In response to the amended complaint, the Town filed a
motion to dismiss for failure to state a claim under Federal Rule
of Civil Procedure 12(b)(6). As to the federal civil rights claim
in Count Two, which is the only part of the amended complaint
before us on appeal, the Town urged the district court to dismiss
on the ground that municipal liability for civil rights claims can
only rest on actions committed by the municipality itself, not on
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respondeat superior or vicarious liability for acts committed by
employees of the Town. See Monell v. Dep't of Soc. Servs. of New
York, 436 U.S. 658, 694-95 (1978). Agreeing with the Town that the
Palermos had only alleged wrong-doing by "the individuals who
denied the requisite permits to develop the site and who ignored
the appraiser's opinion to offer a wholly inadequate award," rather
than wrong-doing by the Town itself, the district court dismissed
Count Two in its entirety.2
On appeal to this court, the Palermos argue that the
motion to dismiss as to Count Two's federal civil rights claim was
improperly granted because the Town was the "moving force" behind
a "policy, practice, or custom" of "tak[ing] certain property of
2
The district court put forth a second ground for dismissal of
Count Two, that the Palermos failed to identify the constitutional
right(s) that they alleged were violated by the Town. "[T]he
complaint is unclear, at best, as to which of their constitutional
rights were violated and what specific conduct of the Town deprived
plaintiffs of those rights." Palermo v. Town of North Reading, No.
05-11782-RWZ (D. Mass. Nov. 14, 2008) (order granting motion to
dismiss).
In addition, though not relevant to this appeal, we note that
the district court dismissed Count One because, "To the extent the
plaintiffs continue to complain about the inadequate pro tanto
award, their procedural due process rights have been fully
vindicated by the jury trial in which they were heard and the jury
clearly heard them." Id. The district court also noted that "[I]t
is difficult . . . to discern the basis for the claim that the
taking was unconstitutional and second, to reconcile that claim
with plaintiffs' acceptance of the award." Id. The Palermos did
not appeal from the dismissal of Count One.
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its inhabitants by eminent domain through the use of an unlawful
process."3
Having conducted a de novo review, TAG/ICIB Servs., Inc.
v. Pan Am. Grain Co., Inc., 215 F.3d 172, 175 (1st Cir. 2000), we
reject the Palermos' arguments on appeal. The district court was
correct to conclude that where municipal civil rights liability
under § 1983 is premised solely on the actions of municipal
employees or representatives, as was the case in the Palermos'
amended complaint, liability does not attach. See Monell, 436 U.S.
at 694 ("We conclude, therefore, that a local government may not be
sued under § 1983 for an injury inflicted solely by its employees
or agents.").
While it true, as the Palermos argue on appeal, that
municipal liability can attach where "execution of a government's
policy or custom . . . inflicts the injury," id.; see also Jett v.
Dallas Indep. Sch. Dist., 491 U.S. 701, 737 (1989), the Palermos
never made such a Monell claim until their appeal to this court.
The Palermos did not mention the Town's policy, practice, or custom
in their amended complaint, opposition to defendant's motion to
dismiss, or anywhere else.4 "It is a bedrock rule that when a
3
The Palermos also argue, in response to the district court's
second ground for granting the motion to dismiss on the civil
rights claim, that the constitutional right violated by the Town
was the right to substantive due process.
4
Indeed, the amended complaint is premised on the notion that
the Palermos were treated differently than other property owners in
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party has not presented an argument to the district court, she may
not unveil it in the court of appeals." United States v. Slade,
980 F.2d 27, 30 (1st Cir. 1992). We decline the Palermos' request
to read their amended complaint so as to discover a claim that they
simply did not make.5
We therefore affirm the district court's dismissal of the
Palermos' federal civil rights claim against the Town.
the Town, rather than the same as many other property owners as
part of the Town's policy, practice, or custom. The Palermos
asserted at oral argument that Paragraph 26 of the amended
complaint raised a sufficient Monell claim for purposes of a motion
to dismiss. That paragraph alleged that "the actions, decisions,
and policies" of the Town "deprived the Plaintiffs of all
economically beneficial use of the Premises." Under Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 555 (2007), this allegation is not
nearly sufficient to support a Monell claim because the complaint
as a whole contained no factual assertions whatsoever regarding
Town policy. See Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009)
("To survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to 'state a claim to
relief that is plausible on its face.'") (quoting Twombly, 550 U.S.
at 570). As noted above, the factual premise of the amended
complaint was that the Palermos had been treated differently from
other property owners, not similarly in accordance with Town
policy.
5
In addition, the Palermos make a brief argument that the
federal constitutional injury they suffered was the violation of
their right to substantive due process. This alleged injury was
not included in their amended complaint and we will not consider it
here for the first time. Slade, 980 F.2d at 30. We agree with the
district court that the Palermos failed to specify the
constitutional right upon which their § 1983 claim was premised.
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