Posted by: Patricia Salkin | August 7, 2014

Seventh Circuit Court of Appeals Holds Developer’s Failure to Pursue Available State Remedies Barred Its Claim

Plaintiff CEnergy–Glenmore Windfarm # 1, LLC, obtained a conditional use permit from the town of Glenmore, Wisconsin, to develop a wind farm, but the company did not obtain required building permits in time to take advantage of a lucrative opportunity to sell electricity generated by wind turbines to a Wisconsin power company. CEnergy then filed this lawsuit against Glenmore claiming a denial of its right under the Fourteenth Amendment to substantive due process and a violation of the town’s state law obligation to deal in good faith. The district court dismissed the due process claim for failure to state a claim upon which relief can be granted and declined to retain jurisdiction over the supplemental state law claim, and CEnergy has appealed.

The question of whether CEnergy has identified a property interest in the building permits it sought was not addressed by the court. Like the district court, the Court of Appeals concluded that CEnergy’s substantive due process claim failed because the Board’s actions were not arbitrary in the constitutional sense, and because CEnergy did not seek recourse under state law. Here, CEnergy made no attempt to proceed under the ordinance, even after the Town Board refused to accept its permit applications in September 2010 and began making excuses for not taking action on the permit requests despite knowing of the deadline CEnergy faced. Nor did CEnergy take advantage of another potential option under state law: seeking a writ of mandamus to force the town to act on the permit applications. The district court’s holding was therefore affirmed.

Centergy-Glenmore Wind Farm #1, LLC v Town of Glenmore, 2014 WL 3867527 (7th Cir. 8/7/2014)

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