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Pulte Home Corporation v. Montgomery County

United States District Court, D. Maryland

July 17, 2015



GEORGE J. HAZEL, District Judge.

This is a civil rights action brought by Pulte Home Corporation and Shiloh Farm Investments, LLC (collectively, "Pulte") against Montgomery County, Maryland (the "County") and the Maryland-National Capital Park and Planning Commission (the "Commission") (collectively, "Defendants") for allegedly violating Pulte's state and federal civil rights by enacting land use legislation that adversely affected Pulte's ownership interests in approximately 541 acres of land it owns in Clarksburg, Maryland. Presently before the Court are two fully briefed motions: Pulte's motion to remand to state court ( see ECF No. 21) and the Commission's motion to dismiss. See ECF No. 19. A hearing is unnecessary. See Loc. R. 105.6 (Md.). For the reasons stated below, Pulte's motion to remand is DENIED and the Commission's motion to dismiss is DENIED.


Pulte is in the business of residential real estate development. Between November 2004 and January 2006, Pulte purchased or entered into a contract to purchase approximately 541 acres of property (the "Development Land") in Clarksburg, Maryland. See ECF No. 2 at ¶ 5. Until July 2014, the Development Land was governed by the 1994 Clarksburg Master Plan ("1994 Master Plan"), which divided Clarksburg development into four stages. See id. at ¶¶ 7-8. Under Stage Four of the 1994 Master Plan, the Development Land, as well as other parts of Clarksburg, were to be developed into residential communities at "specific residential densities" based upon the zoning affixed to the land by the County in 1994. See id. at ¶ 8. Specifically, the Development Land was zoned for residential development under the RE-1/TDR-2 classification, which allowed for the development of one dwelling unit per acre, but encouraged two units per acre through the purchase of County Transferable Development Rights ("TDRs"). See id. at ¶ 9. Pulte contends that, in reliance on this zoning designation and the County's TDR policies, it purchased 323 TDRs from County farmers for over $12 million. See id. at ¶¶ 9, 15. Under the Master Plan and RE-1/TDR-2 zoning, Pulte estimated that it could build between 954 and 1, 007 detached homes and townhomes on the Development Land. See id.

Before development could proceed into Stage 4, however, the 1994 Master Plan required the completion of several triggers, including a baseline biological assessment of Little Seneca Creek and Ten Mile Creek watersheds, the issuance of 2, 000 building permits east of Interstate 270 as part of Stages 2 and 3, and a County report evaluating water quality best management practices and other mitigation techniques. See id. at ¶ 10. Pulte maintains that these conditions were satisfied by 2009, at which time the 1994 Master Plan directed the County to consider Water and Sewer Plan amendments to permit extension of public facilities to the Ten Mile Creek area. See id. at ¶ 11. Thus, on May 12, 2009, in reliance on the 1994 Master Plan directives, Pulte submitted its Water and Sewer Category Change Request application to the Montgomery County Department of Environmental Protection ("DEP") for review by the County and the Commission. See id. at ¶¶ 11-12. Pulte contends that since 2009, however, the County has failed to act on its completed application, preventing Pulte from proceeding with other aspects of Defendants' development approval process. See id. at ¶¶ 15-20, 29-30.

Around the same time that Pulte submitted its Water and Sewer Category Change Request, Pulte also submitted a Pre-Application Concept Plan to the Commission pursuant to the County subdivision ordinance. The Commission, however, refused to endorse the plan despite the fact that, according to Pulte, the plan fully conformed with the zoning ordinance. See id. at ¶¶ 21-28. Moreover, Pulte contends that the Commission refused to meet with it regarding its Pre-Application Concept Plan and eventually ceased responding to its requests altogether. See id. at ¶¶ 23-27. Instead, Pulte alleges, rather than proceeding with the Stage 4 development as directed by the 1994 Master Plan, the County and the Commission began a multi-year campaign aimed at curtailing permissible development of the Development Land.

In particular, Pulte alleges that Defendants reopened the 1994 Clarksburg Master Plan upon which Pulte relied when making its original investment of over $53 million into the Development Land. According to Pulte, the County requested that the Commission re-open the 1994 Clarksburg Master Plan in order to study the Ten Mile Creek watershed, which Pulte contends was an unnecessarily extreme land use approach since the Commission could have studied the watershed without re-opening the Master Plan. See id. at ¶ 36. Based on this study, the Commission prepared a draft amendment to the Master Plan and submitted it to the County on October 25, 2013. See id. at ¶ 54. Pulte maintains that the amendment included unprecedented regulatory restrictions and exactions aimed specifically at the Development Land based on technical reports provided by consultants retained and controlled by the Commission. See id. The County then revised the Commission's draft amendment and, according to Pulte, approved an even more stringent version. See id. at ¶ 65.

In its consideration of the Commission's Draft Master Plan Amendment, Pulte contends that Defendants failed to adequately discuss, analyze, or refute any of Pulte's expert reports submitted into the public record addressing what it perceived as errors and misstatements in the Commission's draft and in the work of its consultants. See id. at ¶ 61. After the close of the public record, Pulte alleges that the County solicited extensive new testimony from state and federal government employees in an attempt to justify Defendants' actions. See id. at ¶ 64. Not long after, the Commission then adopted the County's version of the Master Plan Amendment. See id. at ¶¶ 68, 71.

Following Defendants' approval and adoption of the 2014 Master Plan Amendment, Pulte contends that Defendants drafted and implemented the Clarksburg West Environmental Overlay Zone, which imposed a radically low impervious cap on Pulte's use of the Development Land. See id. at ¶¶ 69-70, 72. Then, two days later, the Commission amended its Montgomery County development regulations, called Environmental Guidelines, which, according to Pulte, imposed extraordinary restrictions on any future use and development of the Development Land. See id. at ¶ 73. Additionally, the Commission prepared, and the County enacted, a downzoning of the Development Land from a residential to an agricultural classification. See id. at ¶¶ 54, 80.

Believing that Defendants' land use, planning, and zoning actions arbitrarily and capriciously targeted the Development Land, Pulte filed suit against the County and the Commission on November 14, 2014 in Montgomery County Circuit Court. In its complaint, Pulte contends that Defendants' actions violated its due process and equal protection rights and amounted to a taking of private property requiring just compensation. The County removed the case to this Court on December 18, 2014. See ECF No. 1. Pulte has filed a motion to remand to state court. See ECF No. 21. Additionally, the Commission has filed a motion to dismiss.[1] See ECF No. 19. For the reasons stated more fully below, the Court will DENY both motions.


Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint if it "fails to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). This rule's purpose "is to test the sufficiency of a complaint and not to resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses." Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006). To that end, the Court bears in mind the requirements of Fed.R.Civ.P. 8, Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), when considering a motion to dismiss pursuant to Rule 12(b)(6). Specifically, a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief, " Fed.R.Civ.P. 8(a)(2), and must state "a plausible claim for relief, " as "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678-79. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. at 663.


A. Motion to ...

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