Tracy Luster v. Village of Ashmore

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 22-3065
TRACY LUSTER,
Plaintiff-Appellant,
v.
VILLAGE OF ASHMORE,
Defendant-Appellee.
____________________
Appeal from the United States District Court for the
Central District of Illinois.
No. 2:21-cv-02139-CSB-EIL — Colin S. Bruce, Judge.
____________________
SUBMITTED MAY 26, 2023 * — DECIDED AUGUST 2, 2023
____________________
Before ROVNER, HAMILTON, and SCUDDER, Circuit Judges.
HAMILTON, Circuit Judge. Plaintiff Tracy Luster was buying
a home on contract in the Village of Ashmore, Illinois, when
the village acquired the property for a municipal park and
* We agreed to decide this case without oral argument because the
briefs and record adequately present the facts and legal arguments, and
oral argument would not significantly aid the court. See Fed. R. App.
34(a)(2)(C).
2 No. 22-3065
demanded that Luster, who was living there with his family,
vacate the property. Luster filed this suit under 42 U.S.C.
§ 1983. He alleges that the village violated his right to proce-
dural due process under the Fourteenth Amendment, as well
as state tort law, by taking the home without adequate notice
and an opportunity to be heard. The district court dismissed
Luster’s third amended complaint because he failed to plead
that he lacked an adequate post-deprivation remedy. This was
a legal error, so we vacate the judgment and remand.
We accept as true the well-pleaded facts in Luster’s opera-
tive complaint and draw reasonable inferences in his favor.
LaBella Winnetka, Inc. v. Village of Winnetka, 628 F.3d 937, 941
(7th Cir. 2010). In 2019, Luster was buying a house in Ashmore
on contract and had already paid the owner at least twenty
percent of the price of the home. The village contacted Luster
to obtain the property to create a municipal park. Luster re-
buffed this offer. The village then contacted the property
seller’s heir. (It appears the original seller died after contract-
ing with Luster.) According to Luster, the village knew of his
contract but still convinced the heir to convey a warranty deed
to the village without notifying Luster. The village then sent
a letter to Luster demanding immediate possession of the
property. According to Luster, he was unable to insure the
house because of the ownership dispute. The house then
burned down while Luster was attempting to quiet title. The
fire destroyed his family’s possessions and left them home-
less.
In June 2021, Luster sued the village under § 1983, seeking
damages for his lost property and the village’s allegedly “ma-
licious conduct” in demanding that Luster and his family va-
cate the home, just before Christmas, no less. The district court
No. 22-3065 3
dismissed Luster’s first amended complaint. Because Luster
asked for damages and specific performance of the contract
rather than a procedural remedy, the judge thought he had
not alleged a viable claim under the Fourteenth Amendment.
The court gave Luster two more chances to amend.
In his operative complaint—his third amended—Luster
requested both damages and a hearing on ownership of the
property. The district court granted the village’s motion to
dismiss that last version of the complaint because, the court
concluded, Luster was alleging that the deprivation of his
property resulted from “random and unauthorized acts by
state employees.” The court thought that a plaintiff making
such allegations must also allege that state law offered no ad-
equate post-deprivation remedies. The district court then re-
linquished supplemental jurisdiction over Luster’s state-law
claims and dismissed the action with prejudice after finding
that further amendment would be futile.
We review the dismissal de novo. Bradley v. Village of Uni-
versity Park, 929 F.3d 875, 882 (7th Cir. 2019) (reversing dismis-
sal based on similar theory where employee alleged he was
fired without due process).
In dismissing Luster’s third amended complaint for not al-
leging that he lacked adequate post-deprivation remedies un-
der state law, the district court seemed to rely on Parratt v.
Taylor, 451 U.S. 527 (1981), and its progeny. We addressed that
case at some length in Bradley. In Parratt, the prisoner-plaintiff
alleged that prison officials had lost hobby materials the pris-
oner had ordered through the mail. The plaintiff claimed he
had been deprived of his property without due process of law
and ultimately won a damages verdict in the district court.
4 No. 22-3065
The Supreme Court rejected the due process claim because
the idea of a pre-deprivation hearing was impractical, even
nonsensical, when the deprivation of property happened as a
result of “random and unauthorized” acts of prison officials,
at least so long as the plaintiff had access to meaningful post-
deprivation remedies under state law. 451 U.S. at 541. (Parratt
was overruled in part in Daniels v. Williams, 474 U.S. 327(1986), on the issue whether negligent conduct could violate
the Constitution. In other respects, the narrow rule of Parratt
for random and unauthorized deprivations with meaningful
post-deprivation remedies remains sound.)
When Parratt applies, it excuses § 1983 liability for a lack
of due process when (1) the deprivation is caused by the ran-
dom and unauthorized act of a government employee rather
than by an established state procedure, and (2) a meaningful
post-deprivation remedy is available. Bradley, 929 F.3d at 879,
citing Parratt and Hudson v. Palmer, 468 U.S. 517, 532–33 (1984).
We have said repeatedly that Parratt is a “rare exception to
due process norms.” Bradley, 929 F.3d at 886, quoting Brunson
v. Murray, 843 F.3d 698, 715 n.9 (7th Cir. 2016). The exception
is based on the “pragmatic reasoning” of Parratt, id., that in
some cases providing a hearing before deprivation is a prac-
tical impossibility. Parratt, 451 U.S. at 541.
Under the circumstances Luster alleges here, however, we
see no obvious reason why the village could not have pro-
vided advance notice and a pre-deprivation hearing before it
seized Luster’s property interest under his contract to pur-
chase the home. Parratt therefore does not apply here. (The
village has assumed for purposes of its motion to dismiss that
Luster’s contract gave him a property interest entitled to con-
stitutional protection.)
No. 22-3065 5
Luster’s complaint does not allege or permit a reasonable
inference that he was deprived of his property interest by the
random, unauthorized acts of any village employee. Rather,
he consistently alleges that the village, as part of its plan to
establish a municipal park, deliberately deprived him of his
property interest and attempted to remove him without prior
notice and an opportunity to be heard. Indeed, it is difficult to
imagine how unauthorized employees could complete a real
estate transaction for the village. The village has not asserted
as much.
In any event, Parratt does not excuse a municipality from
its due process violations even though official actions may
also violate state laws that offer a meaningful post-depriva-
tion remedy. Bradley, 929 F.3d at 880. Pre-deprivation notice
and hearings are not impractical, and therefore fall outside
the narrow Parratt exception, for deliberate, planned depriva-
tions of property, like firing the plaintiff in Bradley or seizing
Luster’s property. Id. at 886, 892. Accordingly, the core princi-
ple of federal due process protections applies: “the Constitu-
tion requires some kind of a hearing before the State deprives
a person of … property.” Zinermon v. Burch, 494 U.S. 113, 127
(1990).
Construing Luster’s pro se complaint liberally, see Arnett
v. Webster, 658 F.3d 742, 751 (7th Cir. 2011), he states a Monell
claim against the village. See Monell v. Dep’t of Soc. Servs., 436
U.S. 658, 694 (1978); Bradley, 929 F.3d at 892 (conduct by offi-
cials with policymaking authority can be attributed to munic-
ipality). The village has not disputed that Luster was deprived
of his property interest by action under color of law, as the
complaint alleges. All he needed to allege further was that he
6 No. 22-3065
did not receive due process of law. See Zinermon, 494 U.S. at125–26. He did that.
The district court also erred in saying, in dismissing an
earlier version of Luster’s complaint, that a plaintiff who seeks
only damages does not state a due process claim. That is not
the message of Taake v. County of Monroe, 530 F.3d 538 (7th Cir.
2008). We held in Taake that the plaintiff did not state a federal
due process claim because he alleged that he had a contract
with the county and sought “only remedies … for the alleged
breach of contract,” such as damages and specific perfor-
mance. Id. at 543. We explained that “breaches of contract by
the government” gave rise to state-law claims that belonged
in state court. Id. at 542–43. Taake does not apply here, how-
ever. Luster does not allege that he had any contract with the
village. He alleges a seizure of his property without prior no-
tice and an opportunity to be heard. See id. at 543 (citation
omitted).
In addition, the fact that Luster initially sought only dam-
ages for this alleged lack of process does not mean he pled
himself out of federal court. We have said that a plaintiff can-
not use a procedural due process claim to challenge a substan-
tive outcome. For example, a suspended employee cannot sue
to obtain as damages back-pay he believed he should have
been awarded in a separate proceeding. Simmons v. Gillespie,
712 F.3d 1041, 1044 (7th Cir. 2013) (“Simmons does not want
a hearing. He wants money.”). “[T]he federal entitlement is to
process,” see id., and that is what Luster says was missing.
When process is missing, however, damages can be a
proper remedy under § 1983 when a violation of a constitu-
tional right is proved. See Memphis Cmty. Sch. Dist. v. Stachura,
477 U.S. 299, 307 (1986). Indeed, under the facts alleged here,
No. 22-3065 7
damages are Luster’s only possible remedy. The house is
gone. To state a claim, it was enough that Luster alleged that
he was injured by the village’s failure to provide required pre-
deprivation process, which rendered him unable to oppose
the transfer of his property.
We VACATE the judgment and REMAND for further pro-
ceedings consistent with this opinion. The state-law claims,
which are based on the same facts as the due process claim,
are reinstated as well. See Edwards v. Snyder, 478 F.3d 827, 832
(7th Cir. 2007).