Two Supreme Court Cases Test Limits of Local Authority

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By the end of June 2018, the Supreme Court will have decided two cases — Lozman v. City of Riviera Beach and Salt River Project Agricultural Improvement and Power District v. SolarCity — testing the limits of local government authority. Both cases could have serious ramifications for city leaders in the future. And beyond that, the cases could hardly have less in common.

The case of Lozman v. City of Riviera Beach centers on Fane Lozman, a Florida resident who lived in a floating house in the Riviera Beach Marina. When the city of Riviera Beach proposed to redevelop the marina using eminent domain, Lozman became “an outspoken critic”, regularly criticizing the mayor and city council at council meetings.

At one city council meeting, Lozman offered comments about former county commissioners who had served in other communities being arrested. Because of Lozman’s refusal to stop talking, one councilperson had him arrested. But Lozman was not ultimately charged with disorderly conduct or resisting arrest.

As a result, Lozman sued the city, claiming he was arrested in violation of his First Amendment free speech rights for opposing the city’s redevelopment plan. The city, meanwhile, argued that Lozman had been arrested for violating the rule that comments during the public comment period must relate to city business.

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Ultimately, a jury ruled against Lozman. On review, the Eleventh Circuit held that the jury’s verdict was not “against the great weight of the evidence”. The Eleventh Circuit concluded that, because the arrest was supported by probable cause, Lozman’s claim of a First Amendment retaliatory arrest was not valid.

Now, Lozman will argue before the Supreme Court that he should still be able to bring a First Amendment retaliatory arrest claim — even if probable cause existed to arrest him.

In an amicus brief, the State and Local Legal Center argues that the Supreme Court should hold that arrestees must prove the absence of probable cause to bring a First Amendment retaliatory arrest claim. If officers can still be sued even when probable cause is present, states and local governments will face serious difficulty in maintaining order at public events.

Additionally, because all fifty state constitutions also protect free speech, state courts may interpret state constitutions more broadly than the federal constitution. Internal disciplinary measures within state and local police departments offer “meaningful remedies for true victims of retaliation.”

In Salt River Project Agricultural Improvement and Power District v. SolarCity, the Supreme Court will consider the case of SolarCity, a local energy company challenging its own power district.

Headquartered in San Mateo, California, SolarCity is a corporation that sells and leases rooftop solar-energy panels. The Salt River Power District, a political subdivision of Arizona, is the only traditional supplier of power near where many SolarCity customers live.

SolarCity claims that the Power District introduced a new pricing structure in order to prevent the installation of more solar panels. Now, if a customer obtains power from a rooftop solar energy array, they must pay a “prohibitively large penalty.”

As a result, SolarCity sued the Power District, claiming it had violated federal antitrust law. The Power District argued that it is immune from federal antitrust liability per the state-action doctrine, which provides states and, in some instances, local governments immunity from federal antitrust liability.

A federal district court denied the Power District’s motion to dismiss the lawsuit, citing “uncertainties about the specifics of the Power District’s state-law authority and business.” The Power District sought to immediately appeal the district court’s denial of immunity.

Generally, only the final decisions of lower courts may be appealed. Here, however, the district court’s denial of Power District’s motion isn’t final, because the district court must still decide whether the Power District actually violated antitrust law. But the “collateral-order” doctrine allows non-final judgments to be appealed in some instances. The Ninth Circuit held that it does not apply to orders denying public entities state-action immunity.

The State and Local Legal Center’s amicus brief in the case argues that “important federalism and policy considerations” weigh in favor of allowing states and local governments to appeal denials of state-action immunity immediately. More specifically, “because the extension of state-action immunity to governmental entities is rooted in the State’s own sovereign immunity, permitting interlocutory appeal is necessary to respect State sovereignty.”

Likewise, “compelling governmental entities to endure trial court antitrust litigation to final judgment after denial of a state-action immunity motion exposes governmental entities and their taxpaying residents to enormous costs and risks.”

For more information on upcoming Supreme Court rulings and their effects on local governments, register for the State and Local Legal Center’s Supreme Court Midterm Webinar on March 15, 2018.

lisa_soronen_new_125x150About the author: Lisa Soronen is the executive director of the State and Local Legal Center (SLLC), which files Supreme Court amicus curiae briefs on behalf of the Big Seven national organizations, including the National League of Cities, representing state and local governments. She is a regular contributor to CitiesSpeak.