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EJS properties, a prospective purchaser that had purchase contract for property contingent on rezoning brought action against city of Toledo and a former city councilman Robert McCloskey asserting claims under § 1983 and Ohio state law, alleging the former councilman improperly sought $100,000 from the vendor and prospective purchaser in exchange for the council’s approval of the proposed re-zoning ordinance, and that defendants, inter alia, violated its right to substantive and procedural due process, equal protection, and to petition the government for redress of grievances.  District Judge Carr granted summary judgment to defendants on all claims other than the claim against McCloskey for tortious interference of business relationships, due to evidence offered by EJS that his actions were outside scope of employment and taken in bad faith thus raising an issue of material fact. 

EJS filed a Rule 59(e) motion for reconsideration of the order arguing the court overlooked its liberty interest, incorrectly concluded that it lacked a protected property interest;  incorrectly concluded that the “shocks” the conscience standard is not an alternative avenue to establish liability under § 1983, and incorrectly concluded that it had no First Amendment claim. 

With regards to the claims of procedural due process, EJS contended it had a liberty interest in an unbiased decision-making process in connection with its rezoning application and a protected property interest in both its rezoning request and purchase and lease agreements. 

The court noted that while a decision by a biased or corrupt decision-maker may constitute a deprivation of procedural due process, freedom from submission to a biased or corrupt decision maker is not itself a liberty interest, but rather constitutes the manner in which due process has been denied where plaintiff has first established a predicate liberty or property interest.  Here, EJS did not cite to any case indicating an independent liberty interest in an unbiased decision-maker and thus the court declined to define a novel liberty interest. 

EJS based its argument that it had a protectable property interest on three notions; A mutually explicitly understanding with defendants which created a justifiable expectation of entitlement to the rezoning it requested, substantive limits on City Council’s discretion to deny the request, and in its agreement to purchase the property and its lease agreement with the school.  Ohio law, which distinguishes between property owners and those who purchase property with the hopes of a zoning change, does not recognize a protected property interest in requested zoning.  EJS knew that the property was zoned M-2 when it conditionally offered to purchase the property, and thus asserted an interest in a zoning change.  EJS failed to create a genuine issue of material fact as to whether it had a mutually explicit understanding that the rezoning would be approved because it ignored the discretion that the City Council retained at the approval stage and did not provide any case law stating that a property interest in zoning change arises when a member of City Council gives such assurance.  City Council’s discretion to reject the rezoning ordinance was not substantively limited by federal and state bribery laws, because those laws would not have required the City to grant EJS’ rezoning application, or entitle it to its rezoning request.  In order to assert a property interest, the mutually explicit understanding must both confer the benefit and limit the discretion of the City to rescind the benefit.   EJS also did not present any evidence to show it was prevented from exercising its right to contract, as it knew that the existing zoning did not permit the property at issue to be used as a school.

 Because EJS did not establish a property or liberty interest, it could not demonstrate a substantive due process violation, and thus the Court declined to reach whether Council’s actions were arbitrary and capricious. 

Lastly, EJS, simply disagreeing with the district court’s decision that defendants did not violate its First Amendment right, presented no new argument nor any new legal authority in support of its argument for reconsideration.  Since it is not the function of a Rule 59 motion to renew arguments already considered and rejected by a court, and because EJS failed to present a genuine issue of material fact regarding whether defendants violated its constitutional rights, its motion for reconsideration was denied.

 EJS Properties v. City of Toledo, 736 F.Supp.2d 1123 (N.D. Ohio 9/2/10).