ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA (Dist. Court No. 98-cv-05556) District Court Judge: Norma L. Shapiro
Before: Alito, Cowen, and LOURIE,*fn1 Circuit Judges.
The opinion of the court was delivered by: Alito, Circuit Judge
United Artists Theatre Circuit, Inc. ("United Artists"), an owner and operator of movie theaters, sought land development approval from Warrington Township Pennsylvania, ("Township"), to construct and operate a multiplex theater on land that United Artists owned. United Artists claims that Warrington Township and its Board of Supervisors (the "Board") complicated and delayed approval of United Artists' development plan, and thereby allowed a competitor to beat United Artists in a race to build a movie theater in the Township, which is too small to support two theaters. United Artists alleges that the Township and individual members of the Board engaged in this conduct because they wanted the Township to receive an improper "impact fee" from the competing developer. In this appeal, the defendant Supervisors contest the District Court's denial of their qualified-immunity-based motion for summary judgment. We vacate and remand.
As a threshold issue, we conclude that the law-of-the-case doctrine does not preclude us from considering whether, as a result of the Supreme Court's decision in County of Sacramento v. Lewis, 523 U.S. 833 (1998), United Artists was required to show that the Supervisors' conduct "shocked the conscience." On the merits, we hold that Lewis has superceded prior decisions of our Court holding that a plaintiff asserting that a municipal land-use decision violated substantive due process need only show that the municipal officials acted with an "improper motive." Thus, Bello v. Walker, 840 F.2d 1124 (3d Cir. 1988), and its progeny are no longer good law.
The dispute underlying this case arises out of a development race between United Artists' proposed multiplex and a competing multiplex theater development proposed by Regal Cinema and developer Bruce Goodman. The record shows that the two companies were competing to obtain approval of their plans by the Township because the market could support only one of the theaters. Goodman agreed to pay the Township an annual "impact fee"*fn2 of $100,000, but United Artists refused the Township's repeated requests for such a payment. United Artists asserts that, because of Goodman's promise to pay this fee, the Township allowed his project to "sail through the land development process," while United Artists' proposal was repeatedly stalled.
The Board of Supervisors' review process consisted of two phases, preliminary approval and final approval. In January 1996, United Artists submitted a preliminary plan for its theater to the Township Planning Commission, an independent body of local officials that makes recommendations regarding land-use plans to the Board of Supervisors. Along with the preliminary plan, United Artists submitted a traffic impact study, which led the Township to require, as a precondition to the issuance of an occupancy permit, the installation of a separate left-turn lane into the theater. United Artists failed to acquire the property necessary to make this improvement and expressed its intention to request a waiver of the condition or to sue for relief. United Artists claims that its failure to construct the road improvement was a mere pretext for the Township's refusal to support its theater proposal and that this refusal was actually motivated by the Township's desire to obtain an impact fee from Goodman and Regency Cinema.
After granting preliminary approval of United Artists' proposal, the Township attempted to change the terms of that approval by requiring United Artists to obtain an easement for the road improvement and to complete the installation of signals before construction could begin, rather than before the time of occupancy, as was originally provided in the preliminary approval. United Artists then brought suit against the Township in the Court of Common Pleas of Bucks County, and that court found the change in conditions to be unlawful under the Pennsylvania Municipalities Planning Code. On appeal, the Commonwealth Court agreed. After succeeding in this state court litigation and eliminating the building permit condition, United Artists began this action against the Township and the Supervisors in federal court.
In the meantime, the Board granted preliminary approval of the Goodman proposal on February 4, 1997 -- one month after the initial application was submitted-- and final approval was granted on May 21, 1997. By contrast, United Artists, did not receive preliminary approval until March 18, 1997, 14 months after submitting its initial application. The Board then tabled its vote on United Artists' application for final approval on three occasions, each time asking if United Artists would pay an impact fee. The Board granted final approval of the United Artists proposal on September 16, 1997. The Goodman/Regal Cinema multiplex was completed in 1999; United Artists never built a theater in Warrington.
United Artists' complaint in this case asserted procedural and substantive due process claims under 42 U.S.C. S 1983, as well as supplementary state law claims. As defendants, the complaint named the Township and the members of the Board of Supervisors--Gerald Anderson, Joseph Lavin, Douglas Skinner, Wayne Bullock, and Katherine Watson ("Supervisors")--in both their official and individual capacities. Asserting the defense of qualified immunity, the Supervisors moved for summary judgment, and in December 1999, the District Court denied the Supervisors' motion with respect to the substantive due process claim, while granting that motion with respect to the procedural due process claim.
On appeal, a prior panel of our Court, in an unpublished opinion, vacated the order of the District Court and remanded for further proceedings. The panel held that the District Court had erred in failing to analyze each Supervisor's qualified immunity claim individually, and the panel instructed the District Court to make such an analysis on remand. United Artists Theatre Circuit, Inc. v. Twp. Of Warrington, No. 00-1064 (3d Cir., filed Nov. 29, 2000) ("United Artists I"), in App. at 112a-118a. In the text of its opinion, the panel stated that the District Court had "properly analyzed the supervisors' request for qualified immunity on summary judgment, having found that United Artists at this stage sufficiently alleged a violation of a clearly established constitutional right." Id . at 4, in App. at 117a. However, in an accompanying footnote the panel stated that it "express[ed] no opinion" at that time as to whether, in the wake of the Supreme Court's decision in County of Sacramento v. Lewis, 523 U.S. 833 (1998), it was necessary for United Artists to show that the Supervisors' conduct "shocked the conscience." Id. at 4 n.2, in App. at 117a.
On remand, the District Court considered the Supervisors' claims individually and again denied their motion for summary judgment on qualified immunity grounds. Aug. 15, 2001, Order, in App. at 3a-26a. The District Court held that United Artists had provided evidence permitting a factfinder to conclude the Board intentionally delayed approval of plaintiff 's project because it wished to receive the impact fee offered by Goodman. If proved, the court believes the monetary motivation of the Board was improper and would constitute a violation of substantive due process." Id. at 14, in App. at 16a (emphasis added). The District Court also held that there was sufficient evidence to conclude that each individual supervisor had subjected United Artists' proposal to heightened scrutiny and had purposefully delayed approval because of the impact fee offered by the competitor. Id. at 19, in App. at 21a. Addressing the panel's reference to the shocks-the-conscience test, the District Court opined that the "shocks the conscience" and "improper motive" tests are essentially the same and that, in any event, a post-Lewis opinion issued by our Court [Woodwind Estates Ltd. v. Gretkowski, 205 F.3d 118 (3d Cir. 2000)] suggested that Lewis had not altered prior circuit precedent. Id. at 9 n.5, in App. at 11a. The Supervisors then took the present appeal.*fn3
As a preliminary matter, United Artists argues that this panel's authority in this case is severely limited by the law-of-the-case doctrine. Under this doctrine, "one panel of an appellate court generally will not reconsider questions that another panel has decided on a prior appeal in the same case." In re City of Philadelphia Litigation , 158 F.3d 711, 717 (3d Cir. 1998).*fn4 United Artists argues that the panel that heard the prior appeal in this case implicitly rejected the proposition that United Artists' substantive due process claim requires proof of conduct that shocks the conscience. We disagree.
The prior panel made two statements that are relevant for present purposes. First, as noted, the prior panel stated: "[W]e believe the District Court properly analyzed the supervisors' request for qualified immunity on summary judgment, having found that United Artists at this stage sufficiently alleged a violation of a clearly established constitutional right." United Artists I at 4, in App. at 1172a. United Artists claims that this statement "constitutes a conclusive determination that may not be disturbed under the law of the case doctrine." Br. of Appellee at 18.
If the prior panel had said nothing more than the statement quoted above, we might be inclined to agree with United Artists, but the prior panel made an additional important statement. In footnote 2 of its opinion, the Court observed that it had raised two issues sua sponte at oral argument and that one of these was "whether the'shocks the conscience' standard announced by the Supreme Court in County of Sacramento v. Lewis, 523 U.S. 833 (1998), is applicable to substantive due process claims like the one at issue here." United Artists I at 4 n.2, in App. at 1172a. The panel continued: "At this time, we express no opinion whether these matters are appropriate in determining the merits of the substantive due process claim." Id. at 4 n.2, in App. at 1172a (emphasis added).
We interpret this last statement to mean that the panel left open the question whether the "shocks the conscience" standard announced in Lewis is applicable to United Artists' substantive due process claim. In other words, while the panel, as stated in the main text of its opinion, had concluded that United Artists was entitled to survive summary judgment under our Court's "existing case law," United Artists I at 4, in App. at 117a, the panel did not decide whether that prior circuit case law had been superceded by Lewis. Presumably because the issue was raised by the panel on its own at argument and was not briefed by the parties, the panel left this issue for consideration in the first instance by the District Court and then, if necessary, by a subsequent panel.
While we believe, as noted, that this is the best interpretation of the prior panel's decision, our conclusion that the law-of-the-case doctrine does not foreclose our consideration of this issue is not dependent on this interpretation. At the very least, footnote 2 of the prior panel opinion creates considerable ambiguity as to whether the prior panel held that conduct that "shocks the conscience" is needed in the present context."Courts apply the law of the case doctrine when their prior decisions in an ongoing case either expressly resolved an issue or necessarily resolved it by implication." Aramony v. United Way of America, 254 F.3d 403, 410 (2d Cir. 2001) (emphasis added) (citing 18 Charles Alan Wright & Arthur R. Miller, Federal Practice and ProcedureS 4478, at 789 (1981)). Here, the prior panel did not "expressly" or by necessary implication decide the "shocks the conscience" issue. The law-of-the-case doctrine relieves a court of the obligation of considering an issue twice, but we must be careful to prevent the doctrine from being used to prevent a properly raised argument from being considered even once. Where there is substantial doubt as to whether a prior panel actually ...