CMR DN CORP and Marina Towers v. City of Philadelphia , 703 F.3d 612 ( 2013 )

PRECEDENTIAL
IN THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 11-4362
_____________
CMR D.N. CORP. AND MARINA TOWERS LTD.,
t/a Waterfront Renaissance Associates, LLP,
Appellant
v.
THE CITY OF PHILADELPHIA; CITY COUNCIL OF THE
CITY OF PHILADELPHIA; PHILADELPHIA CITY
PLANNING COMMISSION; OLD CITY CIVIC
ASSOCIATION; RIVER'S EDGE CIVIC ASSOCIATION;
THE PENN'S LANDING NORTH CIVIC ASSOCIATION;
ANDREW SACKSTEDER; RICHARD HORROW; BRIAN
ABERNATHY; RICHARD THOM; ELIZABETH E.
WHITAKER; JOHN AND JANE DOES 1 THROUGH 10
_____________
On Appeal from the District Court
for the Eastern District of Pennsylvania
(No. 2:07-cv-01045)
District Judge: Honorable Lawrence F. Stengel
_____________
Argued October 1, 2012
Before: FUENTES, FISHER and GREENBERG, Circuit
Judges
(Opinion Filed: January 14, 2013)
Thomas A. Leonard, Esq. [ARGUED]
Richard P. Limburg, Esq.
H. David Seidman, Esq.
Obermayer Rebmann Maxwell & Hippel LLP
One Penn Center, 19th Floor
1617 John F. Kenney Blvd.
Philadelphia, PA 19103-1895
Counsel for Appellant, CMR D.N. Corp. and Marina
Towers Ltd., t/a Waterfront Renaissance Associates,
LLP
City of Philadelphia Law Department
Shelley R. Smith, Esq., City Solicitor
Jane Lovitch Istvan, Esq. [ARGUED]
1515 Arch Street, 17th Floor
Philadelphia, PA 19102-1595
Counsel for Appellees, The City of Philadelphia, Brian
Abernathy, Philadelphia City Planning Commission,
and Philadelphia City Council
OPINION OF THE COURT
FUENTES, Circuit Judge:
2
Waterfront Renaissance Associates, LLP
(―Waterfront‖) owns a lot in the Delaware River waterfront
neighborhood of Philadelphia, Pennsylvania. For almost
twenty years, Waterfront pursued the development of a large
commercial and residential real estate project on this lot. In
2006 the City of Philadelphia (―City‖) enacted an ordinance
that extended certain construction restrictions from a nearby
neighborhood to most lots within the area known as the
Central Riverfront District, including Waterfront‘s property.
Asserting that the construction height restriction imposed by
the extension foreclosed its development plans, Waterfront
sued.
In 2010, however, the City rescinded the application of
the height restriction to Waterfront‘s property. The City then
sought to dismiss Waterfront‘s constitutional claims based on
the height restriction as moot, and moved for summary
judgment on all other claims. Waterfront opposed these
motions and, to avoid the mootness problem, sought leave to
amend its complaint to challenge as unconstitutional a width
restriction that had also been extended by the 2006 ordinance
but had not been rescinded in 2010. Waterfront also sought
to add a claim that an ordinance enacted in 2009, which had
imposed additional requirements on construction along the
Central Delaware River waterfront, was unconstitutional.
At issue in this appeal are the District Court‘s rulings
on these motions. The District Court held that the rescission
of the height restriction mooted Waterfront‘s federal
constitutional claims against the 2006 ordinance, denied
Waterfront‘s motion to further amend its complaint to attack
the width restriction, and granted summary judgment for the
3
City on all other claims, including those based on the 2009
ordinance.
For the reasons that follow, we find no reason to
disturb any of the District Court‘s rulings. We will, therefore,
affirm the judgment of the District Court.
I. Factual Background
A. The Initial Stages of Waterfront’s World
Trade Center Project
The key facts relevant to this appeal are not in dispute.
The origins of this protracted controversy can be traced to
1987, when Waterfront purchased a 5.3-acre lot (the ―Site‖)
to develop a high-rise project (the ―Project‖) in the Central
Riverfront District of Philadelphia, Pennsylvania. The Site is
located at the southwest corner of Delaware Avenue (now
known as Columbus Boulevard) and Noble Street.
Waterfront pursued the development of the Project
over the next several years. In 1988, with the support of a
recommendation letter from Philadelphia Mayor Wilson
Goode, Waterfront obtained an exclusive license to develop
its Project as a World Trade Center-type development. At the
time of Waterfront‘s purchase, the Site was zoned G-2
industrial. Consequently, Waterfront worked with the
Philadelphia City Planning Commission (―Planning
Commission‖) to obtain rezoning of the Site. The Planning
Commission is the Philadelphia agency empowered to
propose zoning ordinances to the Philadelphia City Council
(―City Council‖), and is required by law to make
recommendations to the Mayor for transmission to the City
Council on any matters that may affect zoning. See 351 PA.
4
CODE §§ 4.4-601, 4.4-604 (Supp. 2012). The Planning
Commission agreed to support Waterfront‘s request to rezone
the Site C-4 commercial, a permissive designation that would
allow Waterfront to build a mixed-use, high-rise project. In
exchange, Waterfront agreed to enter into a series of
restrictive zoning covenants with certain civic associations to
govern any construction on the Site. In 1989, per the
Planning Commission‘s recommendation, the City Council
rezoned the Site C-4 commercial, and Waterfront
subsequently entered into the required covenants.
Waterfront also explored ways to finance the World
Trade Center Project, including forming a committee with the
City and several business associations to analyze the Project‘s
feasibility, and entering into a partnership with the Delaware
River Port Authority to develop a plan for construction
financed in part by the Port Authority.1
When financing for the project became a concrete
possibility in early 2005, Waterfront obtained a permit from
the City‘s Department of Licenses & Inspections, the agency
with actual authority to issue building permits, see 351 PA.
CODE § 5.5-1002 (the ―Licensing Department‖), that allowed
demolishing existing structures on the Site and constructing a
28-story apartment tower upon the issuance of a building
1
The Port Authority, a public organization wholly
independent from the City, was created by an interstate
compact between the Commonwealth of Pennsylvania and the
State of New Jersey and is charged with maintaining and
operating the Philadelphia-Camden port. See 36 PA. STAT.
ANN. § 3503 (West 2012).
5
permit.2 Waterfront also entered into a financing agreement
with a major bank, with a loan closing date of January 2006
and a construction start date of February 2006.
Unfortunately, however, Waterfront had to postpone
construction so it could rework the financing due to rising
costs.
B. The March 2006 Ordinance
The loan scheduled to close in early 2006 was the
closest Waterfront would get to the development of its
Project. On March 16, 2006, the City enacted a zoning
ordinance (the ―March 2006 Ordinance‖) that extended to
certain areas of the Central Riverfront District, including
Waterfront‘s Site, a zoning overlay known as the ―Old City
Residential Area Special District Controls‖ (the ―Old City
Overlay‖). See R. 578. The Old City Overlay included a
building height restriction of 65 feet, as well as a width
restriction of 70 feet. See PHILADELPHIA, PA., ZONING CODE
2
Waterfront states that it obtained an ―as-of-right‖ zoning
permit for a 26-story apartment tower in May of 2005 but
cites to a permit in the record that relocated lot lines, and was
issued in March of 2006. See Appellant‘s Br. at 13 (citing R.
1372); see also R. 706 (Waterfront‘s counterstatement of
facts in opposition to the City‘s motion for summary
judgment incorrectly stating that the permit found at R. 1372
was issued on March 3, 2005). The March 3, 2005 permit can
be found at R. 571 but the record contains no permit issued in
May of 2005. Regardless, both the March 2005 and the
March 2006 zoning permits required Waterfront to obtain an
actual building permit before construction could begin. See
R. 571, 1372.
6
§ 14-1610(4), (5) (1990), repealed by Bill No. 110845 (Dec.
22, 2011); R. 159-61.3
Waterfront alleges that its Site was never intended to
be included in the March 2006 Ordinance. It alleges that City
Councilman Frank DiCicco, whose jurisdiction includes the
Site, admitted to Waterfront‘s attorney that the inclusion of
the Site in the area covered by the March 2006 Ordinance was
a ―mistake,‖ R. 682, and that Philadelphia Mayor John Street
stated that he would not have signed the legislation had he
known that the 65-foot height restriction applied to the Site.
The City disputes Waterfront‘s characterization of these
statements. However, Waterfront asked Councilman DiCicco
to repeal the inclusion of the Site from the extension of the
Old City Overlay, but he refused. Moreover, Waterfront
never applied for, or was denied, a permit under the March
2006 Ordinance, and it did not seek a variance.
II. Procedural History
A. Initial Stages of the Litigation
On February 23, 2007, Waterfront sued the City, the
Planning Commission, the City Council, City Councilman
aide Brian Abernathy, three civic associations with which it
had entered into zoning covenants, and certain members of
3
The parties cite the Philadelphia Zoning Code as it existed
before it was repealed in 2011. We use the citation shorthand
―FORMER PHILA. CODE‖ to refer to pre-repeal Zoning Code
sections. Both old and new versions of the Code are available
at http://www.amlegal.com/library/pa/philadelphia.shtml. We
also cite to the parties‘ reproduction in the record of the
relevant code provisions when they are provided.
7
those associations, in state court. The City removed the case
to federal court on March 15, 2007.
An amended complaint, filed in 2008, alleges fourteen
counts of constitutional and state law claims, focusing on the
fact that the March 2006 Ordinance ―impos[ed] a sixty-five
foot (65‘) height restriction on [Waterfront‘s] Site.‖ R. 87
(Compl. ¶ 5).4 Counts I through VIII are directed at the City.
Count I seeks a declaratory judgment, claiming that the
March 2006 Ordinance is ―defective‖ because the City ―did
not at any time discuss or consider the effect that extending
the 65‘ height restriction would have on the public and
private objectives established for the Site,‖ and, therefore, the
Site‘s inclusion within the ordinance was a ―product of
mistake‖ and ―constitute[d] an instance of arbitrary and
unreasonable zoning bearing no substantial relationship to the
public health, safety, and welfare of the City and its
inhabitants.‖ R. 111-13 (Compl. ¶¶ 148-63). Count II seeks
a declaratory judgment that the ordinance was ―procedurally
invalid‖ because ―the newspaper advertising of the March
2006 Ordinance was insufficient to put [Waterfront] on
notice‖ that the City planned to enact the ordinance. Id.
¶¶ 165-70. Counts III, IV, and VIII seek a variety of
4
Citations to the Complaint in the record on appeal are to the
Third Amended Complaint, which was filed after the District
Court allowed Waterfront an opportunity to amend in March
of 2011. See infra at Part II.C. However, the Third Amended
Complaint is identical in all material respects to the
provisions of the Amended Complaint described in Part II-A
of this opinion. See Am. Compl., CMR D.N. Corp. & Marina
Towers Ltd. v. City of Philadelphia, No. 2:07-cv-01045 (E.D.
Pa. July 7, 2008), ECF No. 81.
8
remedies including injunctive relief and damages, based on
state law claims of promissory estoppel, detrimental reliance,
and unjust enrichment. Id. ¶¶ 172-85, 187-95, 212-21. Count
V seeks a declaration that the ―application of the [March 2006
Ordinance] to [Waterfront‘s] Site . . . deprives [Waterfront] of
its constitutional right to substantive due process.‖ Id. ¶ 201.
Count VI seeks a declaration that ―any application‖ of the
March 2006 Ordinance ―to [Waterfront‘s] Site‖ violates
Waterfront‘s ―constitutional right to equal protection‖
because the City had ―arbitrarily treated [Waterfront‘s] Site
differently from other similarly situated C-4 sites . . . .‖ Id.
¶¶ 203, 206. Count VII seeks monetary damages for the
alleged violations of due process and equal protection. Id. ¶¶
208-210.5
On March 31, 2008, the District Court dismissed the
Planning Commission, the City Council, and Abernathy from
the case. The District Court also dismissed Counts II and V.
It reasoned that those counts constituted ―as-applied‖
challenges to the height restriction because they attacked only
the application of the ordinance to the Site. Waterfront
Renaissance Assocs. v. City of Philadelphia, Civil Action No.
07-1045, 2008 WL 862705, at *6-8 n.15 (E.D. Pa. Mar. 31,
2008) (―Waterfront I‖). Therefore, the Court concluded,
5
Counts IX through XIV alleged various tort and contract
claims against the civic associations, and certain of their
individual members, that Waterfront sued. Most of these
claims were dismissed at the pleadings stage, and the District
Court later granted summary judgment on all remaining
claims against those defendants. See CMR D.N. Corp. v. City
of Philadelphia, 803 F. Supp. 2d 328 (E.D. Pa. 2011).
Waterfront does not appeal the dismissal of these claims.
9
because Williamson County Regional Planning Commission
v. Hamilton Bank, 473 U.S. 172, 192 (1985), as well as
Taylor Investment Ltd. v. Upper Darby Township, 983 F.2d
1285, 1293-95 (3d Cir. 1993), require property owners
asserting as-applied challenges to zoning ordinances to apply
for a building permit or seek a variance before they may bring
a claim, and because Waterfront had not met this requirement,
those counts were unripe. See id. At the same time, the
District Court rejected as ―unacceptable‖ the City‘s
arguments that the equal protection claim, Count VI,
constituted an as-applied challenge, and therefore refused to
dismiss that claim. Id. at * 8. Accordingly, after Waterfront
I, the only constitutional claims that remained against the City
were Counts I, VI, and VII.
Following a period of extensive discovery, Waterfront
filed a second amended complaint on May 4, 2009, adding
Count XV against the City. See Second Am. Compl., CMR
D.N. Corp. & Marina Towers Ltd. v. City of Phila., No. 2:07-
cv-01045 (E.D. Pa. May 4, 2009), ECF No. 121. Count XV
alleges that ―the 65‘ height restriction was included in the
March 2006 Ordinance solely for the improper, unlawful, and
unconstitutional purpose of empowering unelected civic
associations to control re-development‖ in the area it covered,
and thus violated due process. See R. 129 (Compl. ¶ 254).
Count XV also alleges that ―[t]he height restriction . . . is
unconstitutional because it effectively delegates land use and
planning powers to non-governmental neighborhood
associations. . . .‖ Id. ¶ 287. On these theories, Count XV
seeks a declaratory judgment and a permanent injunction
against the application of the March 2006 Ordinance as
against all possible developers. The District Court later
denied the City‘s motion to dismiss this new count, rejecting,
10
inter alia, the City‘s argument that Count XV asserted an
unripe as-applied challenge. Waterfront Renaissance Assocs.
v. City of Phila., 701 F. Supp. 2d 633, 642 (E.D. Pa. 2010)
(―Waterfront II‖). Neither Waterfront nor the City have
appealed any of the District Court‘s rulings in Waterfront I or
Waterfront II.
B. The Central Delaware Riverfront Ordinance
and the Rescission of the Height Restriction
Alter the Course of the Litigation
Subsequently, and while the litigation was pending, the
City enacted two additional ordinances that altered the course
of the lawsuit. First, in 2009 the City Council enacted a new
zoning ordinance entitled the ―Central Delaware Riverfront
Overlay District‖ (the ―CRO‖). See FORMER PHILA. CODE
§ 14-1638 (2009); R. 416-21. The CRO covered some of the
same plots to which the Old City Overlay had been extended
by the March 2006 Ordinance, including Waterfront‘s Site.
See id. § 14-1638(3); R. 687-88. The stated purpose of the
CRO was to ―protect the existing characteristics of the built
and natural environment that are essential to achieving the
working guidelines of the Civic Vision . . . while a Master
Plan for the area is developed.‖ Id. § 14-1638(1)(h). The
Civic Vision was a comprehensive plan for the development
of the Central Riverfront District, commissioned in 2006 by
Mayor John Street, and adopted in 2009 by the Planning
Commission as a statement of desirable zoning goals for the
district. See id. § 14-1638(1)(a), (h). To achieve its purpose
of protecting the characteristics of the built area in the Central
Riverfront District while a ―Master Plan‖ was developed, the
CRO provides that an applicant for a zoning permit must first
submit for approval a plan of development to the Planning
11
Commission. The CRO instructs the Planning Commission to
approve the plan within seventy-five days by determining
whether the proposed construction would be ―appropriate in
scale, density, character and use for the surrounding
community.‖ Id. § 14-1638(12)(a). The CRO contains an
extensive list of prohibited building uses for the lots within
the new overlay, as well as an extensive list of building
requirements for new constructions. See, e.g., id. §§ 14-
1638(4), (5), (7) (requiring certain uses in ground floors of
some buildings, and recreational trails and setbacks for other
constructions). Finally, the CRO required the Planning
Commission to issue regulations ―providing objective
standards‖ for the review of plans of development. Id. § 14-
1638(12)(a). The Planning Commission issued such
regulations on April 20, 2010 (the ―CRO Regulations‖). See
R. 912-16. Neither the CRO nor the CRO Regulations define
the phrase ―appropriate in scale, density, character and use for
the surrounding community.‖
Soon after the Regulations were issued, Waterfront
moved under Rule 15 of the Federal Rules of Civil Procedure
for leave to amend its complaint to add a Count XVI,
asserting that the CRO and the CRO Regulations ―[o]n their
face . . . violate the constitutional principles of separation of
powers, due process, and equal protection of the laws.‖ R.
139 (Compl. ¶ 291). Waterfront alleges that the CRO and the
CRO Regulations improperly delegate zoning power to the
Planning Commission, violate equal protection because the
phrase ―appropriate in scale, density, character and use for the
surrounding community‖ is ―vague and indefinite,‖ and
violate substantive due process because they are ―unrelated to
any legitimate planning purpose.‖ Id. ¶¶ 332-35.
12
 Second, in early 2010 the City Council repealed the
application of any height restrictions to most plots within the
CRO, including the Site. See R. 197-98 (Bill No. 100014,
adding a new subsection (12) to the CRO). Based on this
development, the City argued that Waterfront‘s challenge to
the 65‘ height restriction was moot. On August 26, 2010,
after the District Court had permitted the parties to file
several rounds of briefs on the question of mootness,
Waterfront moved for leave to further amend its Complaint
under Rule 15 to ―clarify‖ that it was asserting a challenge to
the width restriction of the March 2006 Ordinance, as well as
the height restriction.
C. The District Court’s Rulings
On March 11, 2011, ruling on the motion, the District
Court allowed Waterfront to add Count XVI but denied its
request to include a challenge to the width restriction. CMR
D.N. Corp. v. City of Phila., Civil Action No. 07-1045, 2011
WL 857294, at *1, 6 (E.D. Pa. Mar. 11, 2011) (―Waterfront
III‖). On the same day, the District Court dismissed
Waterfront‘s constitutional challenges to the March 2006
Ordinance, reasoning that the rescission of the height
restriction had mooted Waterfront‘s request for injunctive
relief and that the claim for damages was ―moot because
[Waterfront] . . . did not apply for a zoning permit or variance
from the height restriction. . . .‖ CMR D.N. Corp. v. City of
Phila., Civil Action No. 07-1045, 2011 WL 857296, at *7
(E.D. Pa. Mar. 11, 2011) (―Waterfront IV‖).
The City later moved for summary judgment on all
remaining claims, including the constitutional challenge to
the CRO and the CRO Regulations and the state law claims of
13
promissory estoppel, detrimental reliance, and unjust
enrichment. On November 4, 2011, the District Court
granted the City‘s motion. See CMR D.N. Corp. v. City of
Phila., 829 F. Supp. 2d 290 (E.D. Pa. 2011) (―Waterfront V‖).
III. Analysis
Waterfront timely appealed the District Court‘s rulings
in Waterfront III, Waterfront IV, and Waterfront V, but did
not appeal the dismissal of the unjust enrichment claim.
Waterfront contends that the District Court (1) erred in
dismissing as moot its contentions that the height restriction
in the March 2006 Ordinance was facially unconstitutional;
(2) abused its discretion in denying Waterfront leave to
amend its Complaint to include the width restriction in its
challenge to the March 2006 Ordinance; (3) erred in
concluding that the CRO and the CRO Regulations are
constitutional; and (4) erred in granting summary judgment to
the City on the state law claims of promissory estoppel and
detrimental reliance. We address each argument in turn.
A. Mootness of the Challenge to the March 2006
Ordinance
As previously noted, the City rescinded the application
of the Old City Overlay‘s 65‘ height restriction to most of the
lots covered by the CRO, including Waterfront‘s Site. The
District Court subsequently held that the rescission mooted
Waterfront‘s facial claims, including its request for an
injunction and for compensatory and nominal damages. See
Waterfront IV, 2011 WL 857296, at *1, 3-5.
Waterfront no longer contends that its request for
injunctive relief against the height restriction presents a live
14
controversy. Accordingly, the sole question on appeal is
whether the rescission similarly mooted Waterfront‘s request
for compensatory and nominal damages. Waterfront also
seeks declaratory relief. We review de novo a district court‘s
determination that claims are moot. See Ruocchio v. United
Transp. Union, Local 60, 181 F.3d 376, 382 (3d Cir. 1999).
1. Compensatory Damages
The District Court held that Waterfront‘s ―claims for
damages in connection with its facial constitutional
challenges are moot‖ because the height restriction was
rescinded and because Waterfront ―never applied for a zoning
permit or variance, and the height restriction never was
enforced as to its project.‖ Waterfront IV, 2011 WL 857296,
at *5. The District Court ruled that, as an alternative, the
claim for damages was speculative, due to the failure to seek
a permit, and therefore could not proceed. Id. at *6.
As to the District Court‘s holding that the claim for
damages was moot, we have stated that ―[d]amages should be
denied on the merits, not on grounds of mootness.‖ Nat’l
Iranian Oil Co. v. Mapco Int’l, Inc., 983 F.2d 485 (3d Cir.
1992) (internal citation omitted). Claims for damages are
retrospective in nature–they compensate for past harm. By
definition, then, such claims ―cannot be moot,‖ Lippoldt v.
Cole, 468 F.3d 1204, 1204 (10th Cir. 2006), and ―[a] case is
saved from mootness if a viable claim for damages exists.‖
Khodara Envtl., Inc. v. Beckman, 237 F.3d 186, 196 (3d Cir.
2001) (citing Nat’l Iranian, 983 F.2d at 489) (emphasis
added). Accordingly, we disagree with the District Court‘s
conclusion that Waterfront‘s claim for damages was moot,
15
but nevertheless agree with the District Court that the claim
for damages cannot proceed, for the reasons that follow.6
Pursuant to Khodara, the relevant question is whether
Waterfront has a viable claim for damages that would save its
case from mootness—i.e., whether damages are a proper
remedy for Waterfront‘s claims. It is black letter law that the
remedy available to a plaintiff should reflect the right that
such plaintiff seeks to vindicate. 1 DOBBS LAW OF REMEDIES
§ 1.7, at 27. In this case, as we describe below, there is some
disagreement as to the type of claim Waterfront asserts. We
therefore carefully consider different interpretations of the
claims for which Waterfront seeks damages, and consider
whether damages are indeed a proper remedy under each
alternative.
Waterfront seeks damages in connection with Counts I
and VI of the Complaint, which allege, respectively, that the
height restriction violates due process because it is ―arbitrary
and capricious‖ and that it violates equal protection. The first
possible interpretation of these counts—the one suggested by
Waterfront—is that they assert a facial challenge against the
height restriction. Indeed, the District Court accepted such
characterization over the City‘s objections. See Waterfront I,
2008 WL 862705, at *7-8. However, Waterfront‘s arguments
throughout this litigation have belied its contention that those
counts constitute a facial challenge. A party asserting a facial
challenge ―seeks to vindicate not only his own rights, but
those of others who may also be adversely impacted by the
6
We may affirm the District Court‘s ruling on alternative
legal grounds established by the record. Erie Telecomm., Inc.
v. City of Erie, 853 F.2d 1084, 1089 (3d Cir. 1988).
16
statute in question.‖ City of Chi. v. Morales, 527 U.S. 41, 55
n.22 (1999). In a facial challenge, the plaintiff does not seek
to establish that the law cannot be applied to him; rather, he
or she must show that ―no set of circumstances exists under
which the [challenged] Act would be valid.‖ United States v.
Mitchell, 652 F.3d 387, 405 (3d Cir. 2011) (en banc) (quoting
United States v. Salerno, 481 U.S. 739, 745 (1987)).
Waterfront‘s claims do not in any way meet these
criteria or otherwise resemble a facial challenge. First, as a
general matter, Waterfront‘s entire theory of the case is that
the inclusion of its own Site was a mistake, not that the
enactment of the ordinance as a whole was a mistake or that
the height restriction could not be constitutionally applied to
any property. Second, neither Count I nor VI alleges that the
height restriction cannot be constitutionally applied under any
circumstances. Instead, those counts refer to the application
of the height restriction to Waterfront alone. See, e.g., R.
113, 120 (Compl. at 28 (requesting declaration that
Waterfront‘s ―Site is not subject‖ to the March 2006
Ordinance); ¶ 206 (contending that ―any application‖ of the
March 2006 Ordinance to ―[Waterfront‘s] Site‖ is
unconstitutional)). Third, Waterfront‘s arguments on appeal
repeat this trend, focusing on the fact that ―the March 2006
Ordinance prevents [Waterfront] from proceeding lawfully,‖
Appellant‘s Br. at 19, and not once explaining why the
ordinance cannot be constitutionally applied under any
circumstance. This pattern persisted at oral argument, where
Waterfront characterized this case as seeking to vindicate its
own rights, not the rights of others. See, e.g., Oral Argument
at 3:07-3:11 (―our argument focuses on the application of the
Old City Overlay to our Site‖); 9:15-9:17 (―we challenged the
application of the Old City Overlay to our project‖); 16:38-
17
16:55 (―our theory in the complaint always was that we
wanted the extension of the ordinance stricken as it applied to
our Site . . . we said this overlay extension shouldn‘t apply to
our Site.‖), available at
http://www.ca3.uscourts.gov/oralargument/audio/11-
4362CMRD.N.Corpv.CityofPhila.wma.7
Our reluctance to recognize Waterfront‘s claims as
facial challenges is supported by the Supreme Court‘s
repeated admonitions that facial challenges are disfavored and
should be considered sparingly. See, e.g., Wash. State
Grange v. Wash. State Republican Party, 552 U.S. 442, 450
(2008). This is so because facial challenges seek the broad
remedy of a complete invalidation of a law and because a
ruling on the constitutionality of all possible applications of a
statute necessarily ―rest[s] on speculation‖ and invites the
―premature interpretation of statutes.‖ Id. (internal citations
omitted).
But even taking Waterfront‘s word that it asserts a
facial challenge seeking to bar enforcement of the height
restriction against all possible developers, we agree with the
City that damages are not available to Waterfront under that
7
The allegations in Counts I and VI of the complaint stand in
sharp contrast to Count XV of the complaint, where
Waterfront asserted that the height restriction was
unconstitutional on its face because it sought to delegate
zoning power to civic associations. See id. ¶ 289. Waterfront
did not seek damages in connection with Count XV and, in
any event, damages would not have been a proper remedy for
that facial attack, for the reasons stated in the following
paragraphs.
18
theory of the case. See Appellees‘ Br. at 26, n.4. When a
litigant challenges the legality of a zoning law on the theories
that the law violates equal protection or is arbitrary and
capricious, for ―a facial challenge, the remedy is the striking
down of the regulation. In the case of an as applied
challenge, the remedy is an injunction preventing the
unconstitutional application of the regulation to the plaintiff‘s
property and/or damages . . . .‖ Eide v. Sarasota Cnty., 908
F.2d 716, 722 (11th Cir. 1990) (citation omitted). This is so
because, in a facial challenge, ―the claimed constitutional
violation inheres in the terms of the statute, not its application
. . . [t]he remedy is necessarily directed at the statute itself
and must be injunctive and declaratory.‖ Ezell v. City of Chi.,
651 F.3d 684, 698 (7th Cir. 2011) (citation omitted) (holding
that damages are not available for a facial challenge to a gun
control law). Thus, ―a victory by the plaintiff in [facial
challenges] normally results in an injunction or a declaratory
judgment, which serves the broad societal purpose of striking
an unconstitutional statute from the books,‖ whereas an as-
applied plaintiff ―merely requests monetary damages.‖
Weissmann v. Fruchtman, 700 F. Supp. 746, 748, 753
(S.D.N.Y. 1988). Waterfront has cited to no case awarding
compensatory damages to a plaintiff asserting only a facial
attack against a zoning law under equal protection or the
―arbitrary and capricious‖ theory. Cf. Daskalea v. Wash.
Humane Soc’y, 710 F. Supp. 2d 32, 42 (D.D.C. 2010) (noting
that the plaintiffs had not ―cited a single case in which
monetary damages were awarded in connection with a facial
due process challenge‖ and holding that such remedy was not
legally available). Thus, even if Waterfront‘s claims truly are
facial attacks, damages are not a proper remedy.
19
The District Court seemed to suggest at times that a
claim for damages in the context of a facial challenge to a
zoning law under these theories is, at best, unprecedented.
See, e.g., Waterfront IV, 2011 WL 857296, at *4. But the
Court, and apparently Waterfront, also reasoned that our
decision in Lighthouse Institute for Evangelism v. City of
Long Branch, 510 F.3d 253 (3d Cir. 2007) stands for the
proposition that, as a general matter, damages are a proper
remedy for facial challenges. See Appellant‘s Br. at 27-28.
In Lighthouse a regulation was challenged on its face as a
violation of the First Amendment and the Religious Land Use
and Institutionalized Persons Act. We held that repeal of that
regulation mooted the claim for declaratory relief but
nonetheless permitted the plaintiff‘s claims for damages to go
forward. See id. at 260-61 (citing Donovan v. Punxsutawney
Area School Bd., 336 F.3d 211, 218 (3d Cir. 2003)).
Critically, however, Lighthouse and Donovan involved
challenges under the First Amendment. ―The courts have
repeatedly shown solicitude for First Amendment claims . . .
with regard to facial challenges to a statute.‖ Peachlum v.
City of York, 333 F.3d 429, 435-36 (3d Cir. 2003). We show
this solicitude, and permit damages for facial challenges in
the First Amendment context, because First Amendment
rights are ―central to guaranteeing our capacity for democratic
self-government.‖ Risdal v. Halford, 209 F.3d 1071, 1072
(8th Cir. 2000). These concerns are not present in the context
of challenges to zoning laws, where we have been careful to
defer to local governments. See Pace Res., Inc. v.
Shrewsbury Twp., 808 F.2d 1023, 1035 (3d Cir. 1987). Thus,
Lighthouse does not establish the availability of damages for
a facial due process challenge to a zoning ordinance.8
8
Moreover, in Lighthouse the plaintiff had actually applied
20
Our statement in County Concrete Corporation v.
Township of Roxbury, 442 F.3d 159, 168 (3d Cir. 2006), that
―the remedies for a successful substantive due process or
equal protection claim as to the face of a zoning ordinance are
the invalidation of the regulation and actual damages,‖ also
does not establish the availability of damages in this context.
The theory of liability advanced in County Concrete was that
the county had enacted a law ―specifically directed‖ or
―aimed at‖ the plaintiff‘s land. Id. at 167, 170. We continue
to adhere to County Concrete’s conclusion that it ―would be
an exercise in futility to require appellants to seek a variance
from an ordinance specifically directed at their properties.‖
Id. at 167. But that is not the type of facial challenge that
Waterfront asserts in this case. Rather than alleging that
Waterfront was specifically and unlawfully targeted by the
March 2006 Ordinance, Waterfront claims that it was
mistakenly included in the reach of the law. Waterfront‘s
theory of the case is thus clearly distinguishable from, and in
fact is the opposite of, the type of claim asserted in County
Concrete.
for and was denied a permit under the later-repealed
ordinance. See Lighthouse, 510 F.3d at 259. The
compensation permitted in that case was therefore connected
to a specific application of the ordinance to the plaintiff. It is
thus not clear that Lighthouse actually permitted a damages
claim to go forward in connection with a facial challenge, as
opposed to an as-applied challenge. See Tanner Adver. Grp.
v. Fayette Cnty., 451 F.3d 777, 786 (11th Cir. 2006) (holding
that plaintiff could not request damages for a facial challenge
to a zoning ordinance under the First Amendment because the
provision ―ha[d] not yet harmed‖ the plaintiff).
21
A second alternative to understanding Waterfront‘s
claims is, as mentioned above, that Counts I and VI truly
assert as-applied challenges. So understood, however, those
counts should have been dismissed for the same reason the
District Court dismissed Waterfront‘s other constitutional
claims—because they were unripe under the rules of
Williamson County Regional Planning Commission v.
Hamilton Bank and Taylor Investment v. Upper Darby
Township. See supra at 8. In Williamson County, the
Supreme Court held that claims that a zoning law constituted
a taking under the Fifth Amendment and went too far by
depriving plaintiff of all viable use of his or her property,
were not ripe until the zoning authority had made a ―final
decision‖ to deny the plaintiff a permit under the law. 473
U.S. 172, 186-94 (1985). Ripeness could not occur until the
plaintiff challenging the ordinance sought and was denied a
variance or a permit under the ordinance. Id. Thereafter, we
held that Williamson County’s ―finality rule‖ applied to
challenges to ordinances based both on procedural due
process or equal protection grounds, and on a theory that a
regulation violated due process because it was arbitrary and
capricious. See Midnight Sessions, Ltd. v. City of Phila., 945
F.2d 667, 686 (3d Cir. 1991) (applying finality rule to
―arbitrary and capricious‖ theory); Taylor Inv., Ltd. v. Upper
Darby Twp., 983 F.2d 1285, 1292-94 (3d Cir. 1993)
(applying finality rule to procedural due process and equal
protection challenge). Because it is undisputed that
Waterfront never applied for a building permit under the
March 2006 Ordinance, if the claims for which it seeks
damages are actually as-applied claims, which we believe
they are, then such claims are not ripe and cannot proceed.
22
As a third and final alternative, Waterfront suggests
that it asserts a hybrid as-applied/facial challenge to the
height restriction. The argument is that the height restriction
was unconstitutional on its face as applied to Waterfront and
that Waterfront was harmed by the mere enactment of the
ordinance. Waterfront IV, 2011 WL 857296, at *4. As the
District Court noted, however, the proper remedy for such a
claim is an injunction, unless and until the offending law is
actually applied to the plaintiff. See id. (citing Daskalea, 710
F. Supp. 2d at 43). Indeed, as in Ezell, where the plaintiffs
sought damages for the mere existence of an ordinance that
would have required them to travel out of town to obtain a
gun permit, Waterfront‘s hybrid theory here would be that
―the City Council violated [the Constitution] by enacting the
[Ordinance] in the first place. If [it] prevail[s], the only
appropriate remedy is a declaration that the [Ordinance] is
invalid and an injunction forbidding its enforcement.‖ Ezell,
651 F.3d at 699 n.10 (emphasis in original). Waterfront cites
to no case awarding anything other than injunctive relief to a
plaintiff who asserts that it was harmed by the mere
enactment of a zoning law, where the plaintiff has not applied
for a permit. See also Rumber v. District of Columbia, 595
F.3d 1298, 1300 n.1 (D.C. Cir. 2010) (claim for
compensatory damages did not save from mootness an action
to enjoin eminent domain against a property because ―no
property ha[d] been taken from [the] plaintiffs‖); Angino v.
Wan Wagner, No. 1:CV-05-1748, 2009 WL 2859041, at *14-
15 (M.D. Pa. Sept. 3, 2009) (Vanaskie, J.) (holding that
damages were not available to a plaintiff who challenged an
ordinance under a due process theory because the plaintiff
had not sought a permit and therefore any claim for damages
was ―purely speculative‖).
23
Limiting the available remedy to an injunction for such
a claim complements our relaxation of Williamson County’s
requirement that a zoning authority make a ―final decision‖
before a developer may bring suit. We have held that this
rule does not apply to facial challenges because it is not
necessary to advance the rule‘s underlying purpose—to allow
the court to determine the extent to which a particular
plaintiff has been harmed by a zoning law. See Williamson
Cnty., 473 U.S. at 191, 199-200; see also Taylor, 983 F.2d at
1291 (finality rule recognizes that the property owner suffers
no constitutional injury until the zoning authority ―defines the
harm to the owner‖). Because the claim in a facial challenge
is that a law cannot be applied to anyone, there is no need to,
and no ability to determine the full extent to which any
particular plaintiff has been harmed. A district court is
therefore unable to properly ascertain compensatory damages
under those circumstances. Thus, far from being futile, as
Waterfront suggests, requiring a developer to seek a permit
even when the law clearly prohibits the construction he or she
desires, permits the court to rule on an actual, ripe
controversy. If, as Waterfront repeatedly contends, the Site
was included in the ordinance by mistake, the application
process may well have yielded an exception for Waterfront.
The rule also permits the court to ascertain the actual extent
of the harm to the claimant. On the other hand, little would
be left of the Williamson County finality rule if we relaxed it
so that a plaintiff could obtain damages and avoid the
obligation to seek a permit altogether by artfully pleading its
case as a ―hybrid facial/as-applied‖ claim as opposed to what
we believe Waterfront‘s claim really is—an as-applied claim.
In keeping with our obligation to not entertain
speculative claims, and in the interest of highlighting the
24
importance of the finality rule, we hold that compensatory
damages are not available to a plaintiff challenging a zoning
ordinance under the theory that the mere enactment of an
ordinance harmed such plaintiff, unless the plaintiff applies
for and is denied a permit under the offending statute.9
Our decision does not leave developers in Waterfront‘s
predicament without a remedy. Waterfront could have had a
non-moot claim for money damages had it complied with the
long-established requirement that it seek a permit or a
variance before asserting a legal challenge to the ordinance on
its own behalf. For unexplained reasons, it chose not to do
so. Waterfront instead chose to request that the federal courts
declare a certain portion of the zoning ordinance
unconstitutional under all circumstances. The proper remedy
had Waterfront been successful would have been to enjoin the
application of the offending portions of the ordinance, not to
award money damages.
2. Nominal Damages
The District Court also concluded that nominal
damages were unavailable because they would be speculative.
9
The Eleventh Circuit has held that a claim that the mere
enactment of a statute harms a plaintiff is properly understood
as an as-applied claim to which the finality rule applies. See
Executive 100, Inc. v. Martin Cnty., 922 F.2d 1536, 1541
(11th Cir. 1991). Our holding is simply another way of
saying what the Eleventh Circuit said in Executive 100—to be
entitled to damages, a plaintiff alleging that it has been
harmed by the enactment of an ordinance must comply with
the Williamson County finality rule.
25
See Waterfront IV, 2011 WL 857296, at *6 (citation omitted).
Waterfront contends that it is entitled to nominal damages
―for a deprivation of the constitutional right to due process.‖
Appellant‘s Br. at 31 (citing Farrar v. Hobby, 506 U.S. 103,
112 (1992)). This argument rests on a misunderstanding of
nominal damages.
Nominal damages have traditionally ―vindicated
deprivations of certain ‗absolute‘ rights that are not shown to
have caused actual injury. . . .‖ Carey v. Piphus, 435 U.S.
247, 266 (1978). The Supreme Court in Carey concluded that
procedural due process was an ―absolute‖ right the denial of
which entitled a plaintiff to nominal damages even without
proof of actual injury. Id. In Carey, however, the plaintiffs
did not bring a facial challenge to a statute. Instead, the
plaintiffs challenged an actual deprivation of an entitlement
pursuant to allegedly faulty adjudicative procedures. See id.
at 251 (plaintiffs‘ claims were based on actual ―suspension
[from school] without any adjudicative hearing of any type‖
(citation omitted)). In other words, the application of
unconstitutional procedures constitutes an injury in and of
itself, for which nominal damages are appropriate regardless
of whether the plaintiff was able to prove an actual injury
resulting from the deprivation. The holding of Carey has
been applied in cases involving the violation of First
Amendment rights, including situations where a plaintiff‘s
request for injunctive relief has been mooted because she was
no longer subject to the offending law. See, e.g., Corder v.
Lewis Palmer Sch. Dist., 566 F.3d 1219, 1224-25 (10th Cir.
2009) (student plaintiff was entitled to nominal damages
because her diploma had been withheld in violation of her
free speech rights).
26
But, like in Carey, the plaintiffs in those cases were
subjected to actual violations of constitutional rights. Here, it
is undisputed that Waterfront never sought and was not
denied a building permit under the March 2006 Ordinance. In
sharp contrast to the plaintiffs in Carey or Corder, who
suffered a specific deprivation pursuant to the
unconstitutional statute or procedures, Waterfront was never
subjected to unconstitutional procedures, wrongfully denied a
permit under an ordinance that was potentially
unconstitutional, or otherwise subjected to a constitutional
deprivation. The only arguable harm that Waterfront has
been subjected to is the mere existence of a law that it alleges
is unconstitutional. We find no authority, and Waterfront has
provided none, for the proposition that a plaintiff is entitled to
nominal damages simply based on the existence of a zoning
law that has never been applied to it. That a legislature may
enact a zoning law that if applied to someone would violate
due process does not entitle any individual who finds it
offensive, including those never subjected to the ordinance, to
nominal damages.10
3. Declaratory Relief
The District Court also dismissed as moot Waterfront‘s
claim for declaratory relief. Waterfront contends that a
declaratory judgment is necessary to ―resolve [its] claim for
money damages.‖ Appellant‘s Br. at 32. The purpose of a
10
As with respect to actual damages, whether nominal
damages would be available if a plaintiff was unlawfully and
selectively targeted by the enactment of a law is not an issue
in this case. See Daskalea, 710 F. Supp. 2d at 44 (suggesting
nominal damages may be available under such a theory).
27
declaratory judgment is to ―declare the rights of litigants.‖
Wilton v. Seven Falls Co., 515 U.S. 277, 286 (1995). The
remedy is thus by definition prospective in nature.
Waterfront‘s contention that a declaratory judgment is
necessary to award damages is therefore incorrect. As in
Khodara, here ―a declaration of unconstitutionality or
injunction directed against the objectionable features‖ of the
March 2006 Ordinance ―would serve no purpose today.
Where a law is amended so as to remove its challenged
features, the claim . . . becomes moot as to those features.‖
Khodara, 237 F.3d at 194 (internal citations omitted)
(alteration in original). Moreover, in light of our conclusion
that neither injunctive nor monetary relief are available,
Waterfront‘s request is moot even if a declaratory judgment is
a necessary precursor to awarding damages.
B. The Motion to Amend the Complaint
While the mootness question was pending, Waterfront
pursued an alternative strategy to stave off dismissal.
Specifically, Waterfront moved under Rule 15 of the Federal
Rules of Civil Procedure for leave to ―clarify‖ that its
complaint also attacked the facial constitutionality of the
March 2006 Ordinance‘s extension of the 70‘ width
restriction to the area including the Site. Waterfront‘s motion
to amend was filed after the District Court had accepted
several rounds of briefs from both parties regarding the
mootness question, as well as after Waterfront‘s motion to
amend its Complaint to assert claims against the CRO. The
District Court denied the motion, reasoning that Waterfront
had ―engaged in undue delay‖ in asserting a challenge to a
restriction that had been in existence since the lawsuit was
filed, and that the proposed change would prejudice the City
28
because it constitutes ―a change to [Waterfront‘s] theory of
liability.‖ Waterfront III, 2011 WL 857294, at *6 (citations
omitted). Waterfront vigorously attacks the District Court‘s
denial of its motion for leave to amend. We have considered
each of Waterfront‘s contentions, and reject them for the
reasons that follow.
A district court‘s decision to deny a motion for leave
to amend a complaint under Rule 15(a)(2) is reviewed for
abuse of discretion. See, e.g., Estate of Oliva v. New Jersey,
604 F.3d 788, 803 (3d Cir. 2010). The motion should be
granted ―when justice so requires.‖ Fed. R. Civ. P. 15(a)(2).
We are mindful that the pleading philosophy of the Rules
counsels in favor of liberally permitting amendments to a
complaint. Adams v. Gould Inc., 739 F.2d 858, 864 (3d Cir.
1984). The motion is nevertheless committed to the ―sound
discretion of the district court.‖ Cureton v. Nat’l Collegiate
Athletic Ass’n, 252 F.3d 267, 272 (3d Cir. 2001).
Waterfront makes much of our statement that
―prejudice to the nonmoving party is the touchstone for the
denial of the amendment.‖ Dole v. Arco Chem. Co., 921 F.2d
484, 488 (3d Cir. 1990) (citation omitted). Waterfront argues
that the proposed amendment would not prejudice the City in
that Waterfront would seek no further discovery with respect
to the new claim and that the District Court abused its
discretion because it made no finding that the amendment
would cause the City discovery-related prejudice.
Waterfront‘s arguments ignore that discovery-related
prejudice is not the only prejudice that may justify denial of a
motion for further leave to amend a pleading. We have also
explained that a significant, unjustified, or ―undue‖ delay in
29
seeking the amendment may itself constitute prejudice
sufficient to justify denial of a motion for leave to amend.
See, e.g., Cureton, 252 F.3d at 273 (―the question of undue
delay requires that we focus on the movant‘s reasons for not
amending sooner.‖). Following this principle, we have
refused to overturn denials of motions for leave to amend
where the moving party offered no cogent reason for the
delay in seeking the amendment. See, e.g., Oliva, 604 F.3d at
803 (no justification for a five-year delay); Bjorgung v.
Whitehall Resort, 550 F.3d 23, 26 (3d Cir. 2008) (no
explanation for three-year delay); Cureton, 252 F.3d at 273-
74 (no reasons given for two-and-a-half year delay).
Here, Waterfront has proffered no good reason for
failing to mention the width restriction in any of its court
filings until late 2010, over three years after it filed its
original complaint in 2007. Instead of explaining the delay,
Waterfront attempts to shift the timeframe of analysis. It
argues that it only delayed by five months between when the
City raised the mootness issue in April of 2010 and when
Waterfront filed its motion in August of 2010. Waterfront
contends that this shift is proper because ―[i]t was not until
the City sought to dismiss [Waterfront‘s] claims as moot that
[it] understood the City had overlooked the fact that the
March 2006 Ordinance imposed a width limit as well as a
height limit.‖ Appellant‘s Br. at 25; see also Appellant‘s
Reply Br. at 3. We reject this argument. For one, it is a
plaintiff‘s burden to set forth the grounds on which it rests a
claim for relief. See Fed. R. Civ. Proc. 8(a). Moreover, if
there was any oversight as to what portions of the Old City
Overlay aggrieved Waterfront, it was of its own doing.
Waterfront has conceded, as it must, that it ―did not
specifically reference the width limit in its complaint.‖ R.
30
482. By contrast, the 65‘ height restriction, or height
restrictions generally, are explicitly mentioned over two
dozen times. See, e.g., R. 114-15, 118, 122, 129-38 (Compl.
¶¶ 172, 174, 180c, 190, 218, 254-55, 267-68, 284-85, 287).
But, even if the timing of the filing of the motion
should be measured from the time when the City first raised
the mootness argument, Waterfront delayed filing the motion
until after it had filed several briefs on the mootness point,
totaling hundreds of pages, as well as a motion to amend the
complaint to add the CRO to the case. None of those filings,
which occupied the District Court‘s time over the course of
several months, mentioned the width restriction. We consider
this sequence of events to be an ―unwarranted burden on the
court‖ that also counsels against granting Waterfront‘s
request for an additional amendment. Cureton, 252 F.3d at
273 (citation omitted).
Moreover, the District Court correctly determined that
the City would be prejudiced because the proposed
amendment would bring a new theory into the case several
years after the beginning of the litigation. Waterfront
contends that the addition of the width restriction does not
constitute a new theory of liability because the complaint
―sought relief against the March 2006 Ordinance as a whole.‖
Appellant‘s Br. at 21. It is true that Waterfront‘s complaint
mentioned the March 2006 Ordinance more generally on
occasion, but, as mentioned, the complaint is replete with
specific mentions of the height restriction and not any
mention of the width issue.
Finally, Waterfront contends that the addition of the
width restriction would not constitute a new theory because
31
the width restriction is a ―de facto ‗height‘ restriction that
prevents [Waterfront‘s] high-rise project.‖ Appellant‘s Reply
Br. at 1, 7. This argument begs the question of why, if it was
so obvious that the width restriction was a problem,
Waterfront never mentioned it explicitly at least once in its
several complaints.11
While we are cognizant of the liberal amendment
policy of the Rules, it is also true that they give district courts
discretion to deny a motion in order to forestall strategies that
are ―contrary to both the general spirit of the federal rules and
the liberal amendment policy of Rule 15(a).‖ 6 CHARLES
ALAN WRIGHT, ARTHUR R. MILLER, MARY KAY KANE &
RICHARD L. MARCUS, FEDERAL PRACTICE AND PROCEDURE
§ 1488, at 814 (1984) (Supp. 2012). We find no reason for
Waterfront‘s failure to mention the width restriction until
2010, other than because the motion was simply an attempt to
avoid dismissal due to mootness. Like in Cureton, the
District Court here ―had considerable familiarity with the
development of the factual and legal issues‖ and ―carefully
analyzed plaintiffs‘ proffered reasons for delay, the prejudice
to [the defendant], and the substance of the amended
complaint.‖ Cureton, 252 F.3d at 274. We therefore
conclude that the District Court conscientiously applied the
11
Waterfront‘s argument that the width restriction was
supposedly mentioned at depositions does not change this
conclusion. The proper focus of the inquiry is whether
Waterfront raised the argument in its pleadings or other
filings in court, not whether an attorney at an open-ended
deposition asked one question.
32
principles embodied by the Rules, and did not abuse its
discretion in denying Waterfront‘s motion to further amend.12
C. The Constitutional Challenge to the CRO
and CRO Regulations
The District Court did permit Waterfront to amend its
complaint to allege that the CRO and CRO Regulations were
unconstitutionally vague and violated due process because
they unlawfully delegated zoning power to the Planning
Commission. On November 4, 2011, however, the court
granted the City‘s motion for summary judgment on both
theories, which Waterfront now challenges on appeal. We
address each contention separately below, reviewing de novo
rulings regarding the constitutionality of a statute. See, e.g.,
United States v. Weatherly, 525 F.3d 265, 273 (3d Cir. 2008).
1. The CRO is not Unconstitutionally
Vague
Waterfront‘s principal theory is that the CRO and the
CRO Regulations violate due process on their face because
they leave undefined the phrase ―development appropriate in
scale, density, character and use for the surrounding
community.‖ FORMER PHILA. CODE § 14-1638(12) (2009).
Waterfront contends that because that phrase is vague, it
cannot comply with the CRO‘s requirement to submit a plan
12
Following oral argument, the parties informed us that the
width restriction has also been rescinded. See PHILADELPHIA,
PA. ZONING CODE §§ 14-502, 14-507 (2012). Thus
Waterfront‘s attempt to amend the complaint is now futile as
well.
33
of development that meets those characteristics. See
Appellant‘s Br. 34-39.13
The Supreme Court has explained that laws must not
fail to ―give [a] person of ordinary intelligence a reasonable
opportunity to know what is prohibited. . . .‖ Vill. of Hoffman
Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 497
(1982) (citing Grayned v. City of Rockford, 408 U.S. 104,
108-09 (1972)). To succeed on a facial vagueness challenge,
the plaintiff must ―demonstrate that the law is impermissibly
vague in all of its applications.‖ Id. at 498. Importantly,
―economic regulation is subject to a less strict vagueness test‖
than criminal laws because businesses ―may have the ability
to clarify the meaning of the regulation by its own inquiry.‖
Id. at 498-99. In determining whether a statute is
unconstitutionally vague, we look to the law as a whole to
determine whether a person of ordinary intelligence may be
able to ascertain the meaning of the challenged terms. See
Grayned, 408 U.S. at 110. That an ordinance may contain
some ambiguities does not render it impermissibly vague.
Vill. of Hoffman Estates, 455 U.S. at 502 (upholding
ordinance that did ―contain ambiguities‖). Thus, to find an
13
It is unclear whether the vagueness argument asserts a due
process or an equal protection challenge. Compare
Appellant‘s Br. at 34-39 (using due process language) with id.
at 40-42 (citing Taylor v. Moore, 154 A. 799 (Pa. 1931) for
the proposition that the alleged vagueness offends equal
protection principles); cf. Waterfront V, 829 F. Supp. 2d at
303-04 (couching vagueness argument as equal protection
claim). Because we conclude that the CRO and the CRO
Regulations are not unconstitutionally vague, Waterfront‘s
argument fails under either theory.
34
economic civil statute void for vagueness, it must be so vague
as to be ―no rule or standard at all.‖ Boutilier v. Immigration
& Naturalization Serv., 387 U.S. 118, 123 (1967).
Guided by these principles, it is clear from the entirety
of the CRO and the CRO Regulations that they do not provide
―no standard at all.‖ First, the words on which Waterfront
focuses, ―surrounding community,‖ have clear, ascertainable
meanings. It is undisputed that the geographical reach of the
CRO is clearly defined and unambiguous. See FORMER
PHILA. CODE § 14-1638(3) (2009). Thus, there is no
confusion as to the geographical scope of the statute, which
logically informs the use of the word ―community‖ in the law.
Moreover, the word ―surrounding‖ in this context has an
easily ascertainable meaning: ―being the environment or
adjacent areas,‖ RANDOM HOUSE WEBSTER‘S DICTIONARY at
1916 (2d Ed. 1999). Thus, a developer need only look at
other structures in the immediate vicinity of a proposed
project to determine whether it is similar to existing
constructions in ―scale, density, character or use,‖ words
which Waterfront does not and cannot contend are
ambiguous. FORMER PHILA. CODE § 14-1638(12) (2009). If
a developer of reasonable intelligence faces a close call after
analyzing the constructions in the district, it can apply for a
permit to eliminate any remaining ambiguity. This is
sufficient to comply with constitutional requirements. See
Vill. of Hoffman Estates, 455 U.S. at 498-99.
We find further support for our conclusion in decisions
of our sister Circuits regarding similarly-worded zoning
ordinances. In Mayes v. City of Dallas, 747 F.2d 323 (5th
Cir. 1984), the court held that an ordinance which required
certain aspects of new buildings to ―harmonize‖ with the
35
―overall character‖ of a district, or with certain ―surrounding
structures,‖ did not unlawfully fail to set forth ―objective,
articulated standards sufficient to prevent the arbitrary
exercise of government power.‖ Mayes, 747 F.3d at 324-25.
Similarly, the Fourth Circuit has held that an ordinance
requiring projects to be ―compatible‖ with and to ―preserve
the rural character of the . . . agricultural community,‖ is not
unconstitutionally vague, noting that the term ―compatible‖
had only one logical meaning. Henry v. Jefferson Cnty.
Planning Comm’n, 215 F.3d 1318 (4th Cir. June 9, 2000)
(table opinion). In doing so, the court also noted that specific
provisions of the ordinance, as well as its stated legislative
purposes, provided builders with ―sufficient notice and
warning as to what requirements [they] must meet in order to
obtain‖ a building permit. Id.
Indeed, as in Henry, many provisions of this statute go
a long way toward eliminating ambiguity (if any exists at all)
in the words ―surrounding community.‖ The CRO has a
stated legislative purpose, which is to permit construction in
the district pursuant to the guidelines set forth in the Civic
Vision while a more comprehensive plan for the improvement
of the district is developed. Id. § 14-1638(1)(h). And, as
catalogued above, both the CRO and the CRO Regulations
contain a long list of prohibited and permitted uses for lots
within the area they cover, and specify detailed requirements
for new constructions. See, e.g., id. §§ 14-1638(4)-(9). These
provisions thus narrow the universe of structures a potential
builder could consider in determining whether a project
would pass muster under the CRO. Finally, the CRO
Regulations list seven specific factors that the Planning
Commission must consider in evaluating a proposed plan of
development, directing the Planning Commission‘s review of
36
proposed plans submitted under the CRO and thereby further
alleviating any remaining ambiguities. See Maher v. City of
New Orleans, 516 F.2d 1051, 1062 (5th Cir. 1975) (―To
satisfy due process, guidelines to aid a commission charged
with implementing a public zoning purpose need not be so
rigidly drawn as to prejudge the outcome in each case,
precluding reasonable administrative discretion‖).
2. The CRO does not Unlawfully Delegate
Authority to the Planning Commission
Waterfront also contends that the CRO and the CRO
Regulations violate substantive due process because they
irrationally permit the Planning Commission to ―control the
issuing of zoning permits on the basis of the Civic Vision and
the Master Plan instead of the existing zoning,‖ and because
such delegation of power is unlawful under the Philadelphia
Home Rule Charter. Appellant‘s Br. at 43.
Waterfront‘s irrationality argument ignores our
repeated admonitions that we:
largely defer to legislative judgment on such
matters as zoning regulation because of the
recognition that the process of democratic
political decisionmaking often entails the
accommodation of competing interests, and thus
necessarily produces laws that burden some
groups and not others. This court will not
substitute its judgment about land use policy
and thereby undermine the legitimacy of
democratic decisionmaking unless the local
37
legislative judgment is without a plausible
rational basis.
Pace Res., Inc. v. Shrewsbury Twp., 808 F.2d 1023, 1035 (3d
Cir. 1987) (internal quotation marks and citation omitted).
Waterfront posits that it was irrational to delegate zoning
power to implement the Civic Vision, a document that
Waterfront contends was designed to outline zoning goals and
not to carry the force of law. Even accepting Waterfront‘s
dubious characterizations of the effect of the CRO, we fail to
see anything irrational in deciding to enact into law a zoning
document approved by the Planning Commission, the very
agency entrusted to advise the City on zoning matters, simply
because the document was originally conceived as providing
aspirational, non-binding goals. Nor can Waterfront seriously
contend that the City Council may not rationally conclude
that such an entity should have a say in the approval of
specific projects, given that the entity is specifically required
by the City Charter to advise the City Council on zoning
matters. See 351 PA. CODE §§ 4.4-601, 4.4-604.
Waterfront‘s argument that the CRO is an unlawful
delegation of power to the Planning Commission also fails. A
violation of state laws governing the allocation of power
between local entities does not, without more, establish a
federal substantive due process violation. See, e.g., Baker v.
Coxe, 230 F.3d 470, 474 (1st Cir. 2000).14
14
Moreover, although it is true that the Philadelphia Charter
gives the Licensing Department the express power to issue
building permits, it also permits the City Council to add new
powers and duties to agencies if not otherwise inconsistent
with the Charter. See 351 PA. CODE § 2.2-305. Thus, any
38
We conclude that the CRO and the CRO Regulations
are not unconstitutionally vague, and that any delegation of
zoning authority to the Planning Commission by the CRO
does not violate the due process clause. Summary judgment
on Waterfront‘s claims against the CRO and the CRO
Regulations was proper.
D. The Promissory Estoppel and Detrimental
Reliance Claims
Finally, Waterfront asserts state law claims of
promissory estoppel and detrimental reliance. The District
Court granted summary judgment to the City against these
claims, Waterfront V, 829 F. Supp. 2d at 304-05, a ruling we
review de novo, applying the same legal standard applied by
the District Court. Am. Eagle Outfitters v. Lyle & Scott Ltd.,
584 F.3d 575, 580-81 (3d Cir. 2009). Summary judgment is
only appropriate if, after reviewing the record in the light
most favorable to the nonmoving party, it is apparent that
there is no genuine dispute as to any fact material to the legal
claims at issue in the case. Id. at 581. Whether a disputed
fact is material depends on the elements of the cause of action
on which the claim for relief is based. For Waterfront to
prevail under these state law theories, it must establish that
(1) the City made a promise it ―reasonably expect[ed] to
induce action or forbearance by [Waterfront], (2) the promise
does induce action or forbearance by [Waterfront], (3) and
injustice can only be avoided by enforcing the promise.‖
delegation of zoning or permit-issuing power to the Planning
Commission, if the CRO can even be fairly characterized as
such, is permitted by Philadelphia‘s laws.
39
Carlson v. Arnot-Ogden Mem’l Hosp., 918 F.2d 411, 416 (3d
Cir.1990) (citation omitted).15
The District Court concluded that Waterfront failed to
satisfy the first element because there was insufficient
evidence that the City had made a ―valid and enforceable
promise‖ to Waterfront. See Waterfront V, 829 F. Supp. 2d at
304-05. Waterfront posits that this was error because under
Pennsylvania law a specific promise is not required, but
rather ―[r]epresentations made to the plaintiff‖ are sufficient.
Appellant‘s Br. at 49. But it is a basic tenet of contract law
that ―mere expression[s] of intention, hope, desire, or opinion,
which shows no real commitment, cannot be expected to
induce reliance.‖ 3 CORBIN ON CONTRACTS § 8.9, at 29-30
(Rev. Ed. 1996); see also C&K Petroleum Prods., Inc. v.
Equibank, 839 F.2d 188, 192 (3d Cir. 1989) (refusing to
permit an action for detrimental reliance based on a ―broad
and vague implied promise‖).
Here, the totality of the relevant facts reveals at most
that the City and certain of its entities supported Waterfront‘s
pursuit of the World Trade Center project at various times.
For example, the City supported the Project by
recommending Waterfront to receive a World Trade Center
license, by participating in the feasibility study committee,
and by brokering or supporting negotiations between
Waterfront and civic associations. See supra at 3-5. The
record also shows that City officials made statements in
15
Promissory estoppel and detrimental reliance claims are
treated interchangeably by Pennsylvania courts. See, e.g.,
Rinehimer v. Luzerne Cnty. Cmty. Coll., 539 A.2d 1298, 1306
(Pa. Super. Ct. 1988).
40
support of Waterfront‘s partnership with the Port Authority
(but it is undisputed that the City was not a party to this
agreement), and it is also true that the City included
Waterfront‘s Site in a request to receive from the
Commonwealth tax-preferred status for certain
neighborhoods in the City. Finally, the record shows that
certain City agencies were aware of the importance to
Waterfront of maintaining restriction-free zoning status. See,
e.g., R. 724 (presentation by Waterfront to the Licensing
Department in February of 2002 explaining that continuous
C-4 zoning was important for the Project). None of these
facts, however, can fairly be interpreted as the type of
representation by the City that would be sufficient to bind it
under the doctrine of promissory estoppel, and Waterfront has
not otherwise pointed to any commitment of any type by City
officials, let alone statements that the City was committed to
adhering to its present intentions indefinitely.
Moreover, the cases cited by Waterfront in support of
its position are distinguishable. See Bootel v. Verizon
Directories Corp., No. Civ. A. 03-1997, 2004 WL 1535798,
*9-10 (E.D. Pa. June 25, 2004) (involving an affirmative
representation to a plaintiff that she could rely on a written
policy as if it were a binding contract); Pennsy Supply, Inc. v.
Am. Ash Recycling Corp., 895 A.2d 595, 605-06 (Pa. Super.
2006) (involving affirmative representations about the quality
of a product on which a third party relied to pursue a project).
Neither case stands for the proposition that a court will
transform representations about present intentions into
binding promises of future action.
We recognize, as the District Court did, that the
―promise‖ sufficient to support an estoppel claim can take
41
different forms under Pennsylvania law. See Waterfront V,
829 F. Supp. 2d at 304 (collecting cases). However, we think
that an important principle of contract law is controlling here:
whether a plaintiff‘s actions constitute ―a sufficient promise
to invoke the doctrine . . . is a question ultimately of the
objective reasonableness of any reliance.‖ CORBIN ON
CONTRACTS § 8.12, at 176 (analyzing Pennsylvania law).
Waterfront is a sophisticated, experienced developer. If it
interpreted any of the encouragement by the City as a promise
of perpetual support for the Project, any subsequent reliance
based on such interpretation was unreasonable and, therefore,
not actionable.
IV. Conclusion
Waterfront‘s constitutional challenge to the height
restriction imposed by the March 2006 Ordinance was
properly dismissed. Waterfront asserted a facial challenge
against the 65 feet height restriction imposed by that
ordinance. When the City rescinded that restriction,
Waterfront obtained exactly the type of relief it sought and,
therefore, it no longer had a claim for prospective relief. The
remedies of compensatory or nominal damages are not
available when a facial attack on a zoning ordinance rests on
either a theory that the law violated equal protection or was
arbitrary and capricious, or that the plaintiff was harmed by
the mere enactment of the restriction.
Nor did the District Court abuse its discretion in
refusing to allow Waterfront a further amendment to its
complaint. The gravamen of Waterfront‘s claim is that the
height restriction was unconstitutional, and it had years to
explicitly mention that it also challenged the width restriction.
42
It did not do so until the eleventh hour, without offering any
cogent explanation for this delay. Under these circumstances,
it was well within the District Court‘s discretion to refuse to
permit further amendments.
Finally, the District Court correctly concluded that the
Central Delaware Riverfront Overlay was not
unconstitutionally vague and did not violate substantive due
process, and that Waterfront had offered no evidence on
which to base a claim for promissory estoppel or detrimental
reliance.
For the foregoing reasons, we will affirm the District
Court‘s judgment.
43