Andon, LLC v. City of Newport News

Citations: 63 F. Supp. 3d 630; 2014 U.S. Dist. LEXIS 162754; 2014 WL 6609359Docket: Civil No. 4:14cv76

Court: District Court, E.D. Virginia; November 19, 2014; Federal District Court

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Plaintiffs Andón, LLC and Reconciling People Together in Faith Ministries, LLC filed a lawsuit against the City of Newport News for violating the Religious Land Use and Institutionalized Persons Act (RLUIPA) after their application for a zoning variance to operate a church was denied. The City filed a Motion to Dismiss, claiming lack of standing and failure to state a claim. The Court held a hearing on November 12, 2014, and subsequently granted the City’s Motion to Dismiss with prejudice.

The Congregation, formed in June 2012, initially met at a business owned by its pastor but sought a new location due to inadequate facilities. They identified a property at 6212 Jefferson Ave, owned by Andón, LLC, which is a 12,503 square foot lot with a single brick building. The property, designated as C1 zoning, permits religious uses only if specific conditions are met, including maintaining a minimum distance from residential zones. While the property met some conditions, it failed to comply with the requirement that no structure be within 100 feet of residentially zoned properties. The building is situated closer than required to several neighboring properties. Despite this, the Congregation leased the property on November 28, 2012, pending City approval, but preliminary discussions indicated that the City planned to reject the variance application.

On March 4, 2013, Andón submitted a variance application to the Newport News Board of Zoning Appeals to operate a church on the Property. The Newport News Department of Codes Compliance filed a Staff Report on April 9, 2013, recommending denial based on the Newport News Code, which requires proof of undue hardship not generally shared by others in the zoning district, and that the variance would not detrimentally affect adjacent properties or alter the zoning district's character. The Department concluded Andón did not demonstrate undue hardship, noting the property could be used without the variance. Following a public hearing on April 16, 2013, the Board voted 3-1 to deny the application for lack of demonstrated undue hardship.

Andón appealed this decision to the Newport News Circuit Court, which upheld the Board's denial on November 1, 2013, citing three reasons: (1) numerous by-right uses of the property were available that did not require a 100-foot setback, (2) any claimed hardship was shared by other properties in the area, and (3) the church's characteristics could be substantially detrimental to adjacent single-family residential properties. Subsequently, Plaintiffs initiated a lawsuit against the City, alleging the denial of the variance violated RLUIPA, leading to the City filing a Motion to Dismiss.

The standard of review under Federal Rule of Civil Procedure 8(a)(2) requires a pleading to present a short and plain statement of the claim. While detailed factual allegations are not mandatory, the plaintiff must provide enough factual content for the court to reasonably infer the defendant's liability. Merely stating the elements of a cause of action with conclusory statements is insufficient for such inference.

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) can be filed when a plaintiff fails to state a claim upon which relief can be granted or does not meet the requirements of Rule 8(a)(2). This motion assesses the legal sufficiency of the complaint without addressing factual disputes, merits, or defenses. The Fourth Circuit emphasizes that such motions should be granted only in "very limited circumstances," yet dismissal is warranted if the plaintiff is not "entitled to relief under any legal theory" suggested by the alleged facts. The court must accept all well-pleaded allegations as true and draw reasonable inferences in the plaintiff's favor; however, legal conclusions lacking factual support are not afforded this assumption of truth.

In the current case, the plaintiffs assert a claim under Section (a)(1) of the Religious Land Use and Institutionalized Persons Act (RLUIPA), which prohibits governments from imposing substantial burdens on religious exercise without demonstrating a compelling governmental interest and using the least restrictive means. The plaintiffs claim that the City's denial of a zoning variance to Andón imposed such a substantial burden on their religious exercise.

The City moves to dismiss this claim on two grounds: the lack of standing for Andón as a party and insufficient pleading of a RLUIPA claim by the Congregation. Standing issues are typically resolved before addressing the merits of a claim. The City argues that Andón lacks standing because the complaint primarily references the Congregation's religious exercise, while the plaintiffs contend that Andón, as the property owner, has standing without needing to engage in religious activity.

Andón only needs to meet the standing requirements outlined in Article III of the Constitution, which the Plaintiffs argue he fulfills as the Property owner. The key issue in the standing dispute is whether involvement in religious activity is necessary to bring a claim under the Religious Land Use and Institutionalized Persons Act (RLUIPA). The Court determines that RLUIPA does not impose such a requirement. The statute's language, particularly Section (a)(1), indicates that a plaintiff must only demonstrate "a substantial burden on the religious exercise of a person" (42 U.S.C. 2000cc(a)(1)). Furthermore, RLUIPA specifies that standing is governed by general Article III rules, with no additional requirement for plaintiffs to engage in religious exercise.

This interpretation aligns with the congressional intent behind RLUIPA, which aims to provide broad protection for religious exercise (42 U.S.C. 2000cc-3(g)). Imposing a further limitation on standing would contradict this intent. Existing case law supports this interpretation, with limited precedent addressing the necessity of engagement in religious activity for RLUIPA claims. Notably, in Dixon v. Town of Coats, the court ruled that property owners can assert substantial burden claims under RLUIPA, emphasizing that there is no widespread prohibition against such claims. The case of DiLaura v. Ann Arbor Charter Township is also referenced, where plaintiffs, including a religious organization, lacked standing under the Religious Freedom Restoration Act (RFRA), illustrating the complexities of standing in related contexts.

The RFRA was declared unconstitutional and subsequently amended by RLUIPA while the plaintiffs' appeal was ongoing. The Sixth Circuit transformed the RFRA claim into a RLUIPA claim, establishing that both parties had standing. The court determined that the development company had Article III standing and emphasized that "religious use of land is the core concept protected by [RLUIPA]." It defined "land use regulation" as any zoning or landmarking law that restricts a claimant’s use of land, provided the claimant has a property interest in the regulated land. The court concluded that the development company, as the record title owner, met the standing requirement under RLUIPA without needing to demonstrate engagement in religious exercise. The City argued against this interpretation, citing the case Calvary Christian Center v. City of Fredericksburg, which suggested plaintiffs must be engaged in religious activity to qualify for RLUIPA protection. However, a closer review revealed that the Calvary court's statement was made in passing and aimed to clarify that a plaintiff must prove a substantial burden on their religious exercise, not that they must be engaged in religious activity per se. Thus, the court ultimately affirmed that RLUIPA does not impose a requirement for plaintiffs to engage in religious exercise to establish standing, aligning with the general standing rules under Article III of the Constitution.

Andón satisfies the requirements for constitutional standing as outlined in Article III, which limits federal court jurisdiction to "cases and controversies." The standing doctrine includes three essential elements: 1) the plaintiff must demonstrate an actual or threatened injury that is concrete, not hypothetical; 2) the injury must be traceable to the defendant's conduct; and 3) a favorable ruling must likely remedy the injury. In this case, Andón claims to have suffered an actual injury due to the City’s denial of a zoning variance for a property lease agreement with a church contingent on receiving City approval. While the Fourth Circuit has not specifically addressed the standing of parties with contracts dependent on zoning approval, precedent indicates that such parties can challenge governmental actions impacting their contracts, as seen in Chesterfield Development Corp. v. City of Chesterfield. The Fourth Circuit’s ruling in Scott v. Greenville County further supports this, recognizing denied building permits as actual injuries. The Court concludes that the loss of a potential future benefit from lease payments, even if not quantified, constitutes an actual injury sufficient for standing. The injury is traceable to the City’s denial of the variance, and a favorable court decision could redress this injury by ordering the City to grant the variance. Thus, Andón meets all Article III standing requirements to assert a RLUIPA claim against the City.

The Court examines whether Plaintiffs have adequately stated a claim under the Religious Land Use and Institutionalized Persons Act (RLUIPA), focusing on the allegation of a substantial burden. RLUIPA, per 42 U.S.C. 2000cc(a)(1), prohibits government actions that impose substantial burdens on religious exercise. The Fourth Circuit has established that a substantial burden occurs when a government regulation pressures a plaintiff to alter its behavior, particularly when a religious organization anticipates building a church and faces impediments due to government action. The Plaintiffs argue that the City’s denial of their zoning variance has led to "delay, uncertainty, and expense" in finding a worship location, which they claim constitutes a substantial burden on their religious exercise. They provide an affidavit from the Congregation's pastor, who details the inadequacies of their current meeting space and the difficulties in finding an alternative property that meets their needs. Although the Plaintiffs reference prior case law, specifically Chase v. City of Portsmouth, to support their claim, the Court notes that the facts in Chase differ significantly from the present case. Ultimately, the Plaintiffs assert that their claims demonstrate a substantial burden on their religious exercise as required by RLUIPA.

Legal developments following the Court's ruling in Chase have rendered it inapplicable to the current case, primarily due to the Supreme Court's decisions in Twombly and Iqbal, which established a stricter pleading standard. Consequently, Chase holds little persuasive value as its underlying legal framework is outdated. Even if Chase were assessed under the current standard, it remains distinguishable since the plaintiffs there owned the property and had a longstanding use as a place of worship, while the Congregation here has neither purchased the Property nor utilized it for worship, lacking any reasonable expectation to do so.

The case Plaintiffs reference, Saints Constantine, involved a church that purchased land in a residential zone and faced a rejected rezoning application after adapting its proposal. The Seventh Circuit reversed the district court's summary judgment for the city, citing potential motives to delay the church’s application and the substantial burdens of delay, uncertainty, and increased expenses imposed on the church.

In the present case, however, the Congregation has not faced similar substantial burdens. Although they express uncertainty about leasing the Property, their financial and time investment in securing an alternative location has been minimal, as they are not required to sell property or void a lease dependent on zoning approval. The motivations of the City in this case are clear and neutral, contrasting with the doubts raised in Saints Constantine. Therefore, the Seventh Circuit's findings in Saints Constantine do not apply to this case, and the City's denial of the zoning variance does not impose a substantial burden on the Congregation's religious exercise, raising questions about whether the land use regulation has actually compelled any modification of the Congregation's behavior, as required by the Fourth Circuit's test.

Plaintiffs assert that the lease for the Property was dependent on obtaining necessary City approval to operate a church, which was never granted, resulting in the lease not taking effect. Consequently, the Congregation remains in the same situation as prior to the agreement—seeking a place of worship. Even if the City’s denial of the variance altered the Congregation's actions, the resulting minimal delay and uncertainty do not constitute a substantial burden. The C1 zoning designation’s prohibition of a church does not inherently create a substantial burden; if it did, it would imply that all zoning ordinances limiting church operations would violate RLUIPA. 

The Congregation had no reasonable expectation of using the Property as a church, as initial discussions with the City indicated a likely rejection of any variance application. The lease's contingency on City approval further underscores this awareness. The risk of denial was assumed by the Congregation. Their claims of substantial burden hinge largely on the delays and uncertainties encountered in finding an affordable worship space, which are attributed to their decision to cease searching for alternatives. The Congregation did not assert that it explored all available properties, only that it "looked at other locations."

The Court finds that the delays and uncertainties cited by Plaintiffs are self-imposed and insufficient to demonstrate a substantial burden. Even if the Complaint were amended to reflect a broader search for properties, the difficulties faced in finding an affordable location would stem from typical urban market challenges rather than a substantial burden. Previous cases indicate that the costs and complications of searching for affordable land do not constitute a substantial burden.

The plaintiff church's claims of difficulties in securing a suitable location for worship are deemed to be common challenges faced by all land users, not constituting a substantial burden on religious exercise under RLUIPA. The court emphasizes that government regulations only have an incidental effect on religious practice if they merely increase costs or difficulties. The plaintiffs' reliance on the unaffordability of alternative properties does not substantiate a claim of significant burden. The court highlights that a ruling in favor of the church would contradict RLUIPA's legislative intent and the Constitution, which does not allow religious organizations to avoid neutral zoning regulations. Citing the legislative record, it notes that Congress did not intend for RLUIPA to exempt religious entities from complying with land use regulations or seeking necessary permits. The court concludes that alleging adverse land use rulings alone does not suffice for a substantial burden claim. Finding such a burden would improperly grant religious organizations immunity from regulations applicable to all, violating principles of neutrality mandated by the Constitution. Consequently, the court grants the City’s Motion to Dismiss with prejudice, as the plaintiffs fail to plausibly allege a substantial burden on the Congregation’s religious exercise.

A district court evaluating a 12(b)(6) motion may consider the complaint and any attached documents. Newport News consists of various zoning districts: R1-R4 for single-family residential, R5-R9 for multiple-family residential, O1-O3 for office, C1-C5 for commercial, M1-M2 for industrial, and PI for parking. Churches are allowed in C2 and C3 districts and can be established in R1-R9 areas if specific conditions are met, including a minimum site size of three acres. For other zoning districts, a conditional use permit from the city council is required. Virginia law defines "undue hardship" as a significant hardship nearly equivalent to confiscation, and financial loss alone does not justify a variance. The Board of Zoning Appeals determined that the property would encroach into the required buffer zones of adjacent single-family residential properties, although the court will use the distances cited in the complaint for its consideration. The property includes a two-story stone building with a steeple, and the zoning restrictions might make it more affordable for the Congregation. A map attached by the Plaintiffs indicates neighboring zoning districts that could accommodate a church, though it does not confirm their availability for purchase. The court recognizes that the application of the Religious Land Use and Institutionalized Persons Act (RLUIPA) often requires balancing statutory compliance with constitutional rights, specifically regarding the Free Exercise and Establishment Clauses.