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Tuesday, November 15, 2011

Ind. Decisions - More on: SCOTUS grants cert in: Homeowners' Lose Sewer Suit Against City

Updating yesterday's ILB entry, this morning's Indianapolis Star features a very long and comprehensive story about this case and a related case in federal case. Jon Murray and Bill McCleery are the reporters. A few quotes:

The question for the U.S. Supreme Court: Did the city violate the U.S. Constitution's equal-protection clause when it treated the two groups of Northern Estates residents differently?

The answer might seem obvious, but a legal expert said the case is tricky because courts often defer to such decisions by local governments. Taxpayer-rights groups are watching the Indianapolis case closely.

"We do have examples where some people get treated differently than other people," such as in tax amnesty programs, said David Orentlicher, a professor at the Indiana University School of Law-Indianapolis. "The question is, if you're going to say this is unacceptable, why is this (instance) unacceptable when the other ones are acceptable?"

He added: "The court is going to have to draw some lines here."

Whatever the justices decide could be worth thousands of dollars to 1,500 Indianapolis homeowners participating in two lawsuits -- the one before the U.S. Supreme Court and one pending in U.S. District Court -- with nearly identical claims. For the city, more than $3.5 million -- in partial refunds to homeowners who paid in full or paid installments early under the old sewer program -- is potentially on the line.

Already, the Northern Estates case that's headed to the Supreme Court has tripped up various courts in Indiana. It's the smaller of the two lawsuits and was brought on behalf of 45 plaintiffs living at 31 properties.

A Marion County judge ruled the city owed the residents $381,000. The Indiana Court of Appeals upheld that.

But in May, the Indiana Supreme Court disagreed. Its 3-2 decision found that the city's distinctions between installment payers and those who had already paid in full were rational. Essentially, the city argued that installment payers were more likely to be under financial hardship than those who paid all at once. * * *

The outcome likely will affect the other case -- which, so far, has held more promise for residents seeking partial refunds.

Last year, a federal judge in Indianapolis ruled the city violated the equal-protection clause. The city likely will end up on the hook for $3.2 million once U.S. District Judge Tanya Walton Pratt, who has since taken over the case, enters a final judgment.

The city plans to appeal that case to the 7th U.S. Circuit Court of Appeals in Chicago, but a Supreme Court ruling may decide the issue for both.

Posted by Marcia Oddi on November 15, 2011 09:48 AM
Posted to Ind. Sup.Ct. Decisions