City’s Defense On Appeal Raises Subject-Matter Jurisdiction, So Cross Appeal Unnecessary

Flying J Inc. bought 50 acres of land in New Haven, Indiana intending to develop a travel plaza, hotel, and restaurant complex. But New Haven didn’t want the development and twice denied zoning variances. Flying J sued in Indiana state court, lost in the trial court, then won in the appellate court.

Undeterred, New Haven amended its zoning ordinance to limit developments like Flying J’s travel plaza to two acres. Flying J sued again, this time in federal district court. Flying J charged that its rights to equal protection and due process had been violated by New Haven’s actions in amending the zoning ordinance.

New Haven asked the federal district court to dismiss the case because, the city argued, (1) it was not ripe for decision, so the court did not have jurisdiction to hear it, and (2) the complaint did not state a cause of action. The ripeness argument was based on a U.S. Supreme Court case that ruled an aggrieved landowner must seek remedies in appropriate local agencies and courts before suing in federal court. In this case, because Flying J did not ask the New Haven Plan Commission for a zoning variance, New Haven argued, Flying J’s federal lawsuit was not ripe. The district court disagreed, and ruled that Flying J’s claim was ripe, so jurisdiction was proper. But the court then dismissed Flying J’s complaint for failure to state a cause of action.

Flying J appealed to the Seventh Circuit Court of Appeals. In its reply brief on appeal, New Haven again asserted the same ripeness argument that it made, and lost, in the district court. Flying J countered that New Haven was not permitted to raise the argument on appeal because the city had not filed a cross-appeal.

The Seventh Circuit rejected Flying J’s argument because the court must consider subject-matter jurisdiction at any point in the litigation. Here is the court’s rationale:

Flying J responds that the district court determined that the ripeness requirements … did not apply and that because New Haven did not cross-appeal the issue they are precluded from bringing it up here. This last assertion is incorrect, however, because ripeness “when it implicates the possibility of this Court issuing an advisory opinion, is a question of subject matter jurisdiction under the case-or-controversy requirement.” … New Haven’s argument thus concerns this court’s subject matter jurisdiction over the appeal. We are obliged to consider that at any point in the litigation.

In the end, the appellate court ruled it had jurisdiction but that Flying J did not state a cause of action. Read the whole case, Flying J Inc. v. City of New Haven, 549 F. 3d 538, No. 08-2319 (12/5/08), by clicking here.