San Remo Hotel, L.P. v. City and County of San Francisco, California

PETITIONER: San Remo Hotel, L.P., et al.
RESPONDENT: City and County of San Francisco, California, et al.
LOCATION: Texas State Capitol

DOCKET NO.: 04-340
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: United States Court of Appeals for the Ninth Circuit

CITATION: 545 US (2005)
GRANTED: Dec 10, 2004
ARGUED: Mar 28, 2005
DECIDED: Jun 20, 2005

ADVOCATES:
Paul F. Utrecht - argued the cause for Petitioners
Seth P. Waxman - argued the cause for Respondents

Facts of the case

The owners and operators of a hotel in San Francisco sued the city in state court, arguing a $567,000 conversion fee they had to pay in 1996 was an unconstitutional taking of private property. After California courts rejected this argument, the hoteliers argued in federal district court that the fee violated the Fifth Amendment's takings clause. This claim depended on issues identical to those that had been resolved in their state-court suit. The federal full faith and credit statute, however, barred litigants from suing in federal court when that suit was based on issues that had been resolved in state court (the rule of "issue preclusion"). The hoteliers asked the district court to exempt from the statute claims brought under the takings clause.

Question

Should federal courts make an exception to the full faith and credit statute for Fifth Amendment takings clause claims?

Media for San Remo Hotel, L.P. v. City and County of San Francisco, California

Audio Transcription for Oral Argument - March 28, 2005 in San Remo Hotel, L.P. v. City and County of San Francisco, California

Audio Transcription for Opinion Announcement - June 20, 2005 in San Remo Hotel, L.P. v. City and County of San Francisco, California

William H. Rehnquist:

The opinion of the Court in San Remo Hotel versus San Francisco will be announced by Justice Stevens.

John Paul Stevens:

Petitioners own and operate the San Remo Hotel in San Francisco, California.

In 1993, in response to petitioners' request to convert their property from a residential hotel into a full time tourist hotel, the City Planning Commission required them to meet a number of conditions including the payment of a conversion fee of $567,000.00.

Petitioners sued in Federal Court contending that the conditions constituted a taking of their property without just compensation in violation of the Fifth Amendment of the Federal Constitution.

The Federal District Court and Court of Appeals however, both found that petitioners had not yet been denied just compensation for the taking because they had never asked the State Court to provide them with just compensations.

Thus, the courts held petitioners did not have a right Fifth Amendment injury under our decision Williamson County Regional Planning against the Hamilton Bank of Johnson City.

The Federal Courts dismissed petitioners' unripened claim and agreed to abstain from deciding the rest of petitioners' claims while they return to State Court.

Back in State Court, petitioners raised essentially the same takings claims that they had tried to advance in Federal Court.

After the California Courts denied petitioners' claim on the merits, they attempted to reraise the same issues back in the Federal District Court.

Petitioners argued that they had reserved their federal claims under a case called England against Louisiana and a Board of Medical Examiners, and therefore that preclusion doctrine should not prevent them from retaining a fresh review of the underlying issues in the litigation.

They also argued that the full faith and credit statute which requires Federal Courts to give full faith and credit to state judicial proceedings should not apply because they had been forced to litigate their claims involuntarily in State Court.

The Ninth Circuit Court of Appeals disagreed.

The Court held that the doctrine of issue preclusion prevented the Court from revisiting all issues that were actually decided in the State Court.

Here, because the Court found California takings law coextensive with federal law, all of the underlying issues raised by petitioners' federal complaint had already been decided in full by State Courts.

The Court declined that petitioners' invitation to create a judicial exception to the full faith and credit statute rejecting the argument that Williamson County's requirement that takings claims must first be advanced in State Courts is unfair if applied to preclude relitigation in Federal Court.

For reasons that are fully stated in our written opinion, we agree with the Ninth Circuit.

We do not read our England decision to permit the type of relitigation petitioners requested here.

Moreover, none of our prior cases permit us to create a judicial exception to a validly enacted congressional statute simply to afford a litigant the opportunity to raise a federal claim in a federal forum.

Finally, because we do not read Williamson County to preclude takings claims from being fully litigated in State Courts, there is no cause to except takings plaintiff from the full faith and credit statute.

The judgment of the Ninth Circuit is therefore affirmed.

The Chief Justice has written an opinion concurring in the judgment in which Justices O'Connor, Kennedy and Thomas have joined.