Group V LLC v. Athens-Clarke County Unified Government

[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 22-13246
Non-Argument Calendar
____________________
GROUP V LLC,
a Georgia Limited Liability Company,
Plaintiff-Appellant,
versus
ATHENS-CLARKE COUNTY UNIFIED GOVERNMENT,
Defendant-Appellee.
____________________
Appeal from the United States District Court
for the Middle District of Georgia
D.C. Docket No. 3:21-cv-00140-CDL
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 1 of 7

-- 1 of 7 --

2 Opinion of the Court 22-13246
____________________
Before N EWSOM, G RANT, and L UCK , Circuit Judges.
PER C URIAM:
This case is the latest legal challenge to the Unified Govern-
ment of Athens-Clarke County’s stormwater fee. Group V, LLC
appeals the district court’s decision to dismiss the action on comity
grounds. We affirm.
I.
The county enacted a stormwater utility ordinance in 2004
to help it comply with federal environmental regulations. Under
the ordinance, the county established a stormwater utility that lev-
ied “user fees” on owners of developed property “to generate rev-
enue to pay for governmental projects for flood prevention, water
pollution, and compliance with federal law.” The Supreme Court
of Georgia upheld the ordinance, finding that it imposed “permis-
sible fee[s]” rather than “an unconstitutional tax.” Homewood Vill.,
LLC v. Unified Gov’t of Athens-Clarke Cnty., 739 S.E.2d 316, 318 (Ga.
2013).
Owners of developed property in the county challenged the
ordinance’s constitutionality in federal court. Homewood Vill., LLC
v. Unified Gov’t of Athens-Clarke Cnty., No. 3:15-CV-23 (CDL), 2016
WL 1306554, at *1 (M.D. Ga. Apr. 1, 2016). The district court dis-
missed the case, finding that it “must abstain from deciding the
merits” of the “action due to comity concerns.” Id. at *3. The dis-
trict court explained that comity principles demanded abstention
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 2 of 7

-- 2 of 7 --

22-13246 Opinion of the Court 3
because reaching the merits would “unduly interfere” with the
county’s “legitimate fiscal and budgetary activities” and the plain-
tiffs had “an adequate remedy” in state court. Id. The plaintiffs
argued that “comity concerns only arise in the context of chal-
lenges to local ‘taxes’ and not to local ‘fees,’” but the district court
concluded that Supreme Court precedent foreclosed that argu-
ment. Id. (citing Boise Artesian Hot & Cold Water Co. v. Boise City,
213 U.S. 276 (1909)).
Hearing the same arguments on appeal, we affirmed the dis-
trict court’s abstention based on comity. Homewood Vill. LLC v. Uni-
fied Gov’t of Athens-Clarke Cnty., 677 F. App’x 623, 624–25 (11th Cir.
2017). “In deciding to abstain based on comity,” we explained, the
district court made two findings. First, a “judgment in favor of
plaintiffs would require [the county] to abandon its stormwater fee
system, thus materially disrupting [its] fiscal affairs.” Id. at 624.
And, second, “an adequate remedy exists in state court to vindicate
plaintiffs’ alleged constitutional deprivations.” Id. at 625. The
plaintiffs did “not show[] that these determinations were im-
proper,” and, applying Supreme Court precedent, we concluded
that “the determinations support[ed] abstention based on comity.”
Id.
Like the Homewood plaintiffs, Group V owned developed
property in the county. In 2021, Group V challenged the storm-
water ordinance’s constitutionality and sought damages under 42
U.S.C. section 1983. Group V claimed that the county’s storm-
water fee (1) violated its Fifth Amendment right not to have its
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 3 of 7

-- 3 of 7 --

4 Opinion of the Court 22-13246
property taken without just compensation, (2) violated its rights to
due process and equal protection, and (3) must be enjoined and de-
clared unconstitutional. The county moved to dismiss on comity
grounds or for lack of jurisdiction under the Tax Injunction Act.
The district court granted the motion and dismissed the
case. It found the action “indistinguishable” from the earlier Home-
wood case, in which it had “abstained from deciding the merits of
the action on comity grounds and was affirmed on appeal.” The
district court explained that its “mind [w]as not changed,” so it
again “abstain[ed] based on comity principles.” Group V appeals.
II.
“While we ordinarily review the grant of motions to dis-
miss . . . de novo, a district court’s decision to abstain will only be
reversed upon a showing of abuse of discretion.” Boyes v. Shell Oil
Prods. Co., 199 F.3d 1260, 1265 (11th Cir. 2000) (cleaned up). “A
district court abuses its discretion if it misapplies the law or makes
findings of fact that are clearly erroneous.” Seminole Tribe v. Stran-
burg, 799 F.3d 1324, 1328 (11th Cir. 2015).
III.
“[T]he comity doctrine applicable in state taxation cases re-
strains federal courts from entertaining claims for relief that risk
disrupting state tax administration.” Levin v. Com. Energy, Inc., 560
U.S. 413, 417 (2010). Plaintiffs “must seek protection of their fed-
eral rights by state remedies, provided of course that those reme-
dies are plain, adequate, and complete.” Fair Assessment in Real Es-
tate Ass’n v. McNary, 454 U.S. 100, 116 (1981). This doctrine applies
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 4 of 7

-- 4 of 7 --

22-13246 Opinion of the Court 5
whether a plaintiff seeks damages under section 1983, see, e.g., Win-
icki v. Mallard, 783 F.2d 1567, 1569 (11th Cir. 1986) (“[T]axpayers are
barred by the principle of comity from asserting [section] 1983 ac-
tions against the validity of state tax systems in federal courts.”), or
equitable relief, see, e.g., Boise, 213 U.S. at 282 (“[T]he illegality or
unconstitutionality of a state or municipal tax or imposition is not
of itself a ground for equitable relief in the courts of the United
States.”).
Here, as in Homewood, if Group V is successful in this section
1983 action, it “would require [the county] to abandon the storm-
water fee system, thus materially disrupting [its] fiscal affairs.” See
677 F. App’x at 624. As Group V acknowledges, a favorable ruling
for it will have an effect on the county and require adjustments.
And, as in Homewood, “an adequate remedy exists in state court to
vindicate [Group V’s] alleged constitutional deprivations.” Id. at
625. “Based on our review of the record, and considering McNary,
Levin, and Boise, we cannot conclude that the district court abused
its discretion in abstaining.” Id. at 624; see also Winicki, 783 F.2d at
1570 (“[W]here a [s]ection 1983 action is grounded in an allegation
of an unconstitutional tax scheme, to survive dismissal the plaintiff
must demonstrate that there is no plain, adequate, and complete
state remedy available. The initial burden, then, is upon the plain-
tiff to make such a showing. Unless he is able to do so, the federal
courts may properly refuse to entertain his [s]ection 1983 action.”).
We’re unconvinced by Group V’s two main arguments to
the contrary. First, it contends that the stormwater ordinance
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 5 of 7

-- 5 of 7 --

6 Opinion of the Court 22-13246
imposes a fee and not a tax, so abstention based on comity does not
apply.1 But we affirmed the district court’s rejection of the same
argument in the earlier Homewood case (brought by the same attor-
neys representing Group V). See, e.g., Homewood, 2016 WL
1306554, at *3 (rejecting plaintiffs’ argument “that comity concerns
only arise in the context of challenges to local ‘taxes’ and not to
local ‘fees’” because the “seminal case of Boise[] clearly disposes of
this argument”). We do so, again, here.
In Boise, the plaintiff argued that a municipal ordinance im-
posing a water pipe “fee” was unconstitutional. Id. at 280–81. On
comity grounds, the Supreme Court affirmed dismissal of the ac-
tion. Id. at 287. It explained that “every possible defense to the
collection of the license fee which has been suggested by the com-
pany is available to it in the action at law pending in the courts of
the state of Idaho, and there is no reason whatever shown why the
law should not take its course.” Id. Even though Boise involved a
1 The county contends this argument isn’t properly before us on appeal be-
cause it was insufficiently detailed in the district court. To be sure, “[w]e gen-
erally will not review issues raised for the first time on appeal.”
In re Home
Depot Inc., 931 F.3d 1065, 1086 (11th Cir. 2019). “But there is a difference
between raising new issues and making new arguments on appeal. If an issue
is properly presented, a party can make any argument in support of that issue;
parties are not limited to the precise arguments they made below.”
Id.
(cleaned up). Here, because Group V contested the issue of whether comity
justified dismissal of its challenge to the stormwater fee, it was allowed to flesh
out the argument on appeal.
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 6 of 7

-- 6 of 7 --

22-13246 Opinion of the Court 7
municipal “fee”—and not a tax—the Supreme Court affirmed the
abstention.
Second, Group V argues that, after the Supreme Court’s de-
cision in Knick v. Township of Scott, 139 S. Ct. 2162 (2019), “a district
court may not decline, on grounds of comity, to exercise jurisdic-
tion over federal constitutional challenges to exactions under regu-
latory ordinances.” We disagree. Although Knick abolished the re-
quirement that plaintiffs exhaust state-court remedies before bring-
ing their takings claims to federal court, the case didn’t address or
otherwise alter the comity doctrine. See id.; see also Dorce v. City of
New York, 2 F.4th 82, 97 n.17 (2d Cir. 2021) (rejecting the argument
that Knick “guarantees a takings plaintiff access to federal court not-
withstanding potential state court remedies” because Knick “does
not guarantee a federal forum” or address the comity doctrine
(cleaned up)). As Group V acknowledges, that doctrine remains
viable. See Appellant Br. at 40 (“Knick does not appear to overturn
the comity doctrine . . . .”). The district court didn’t abuse its dis-
cretion in applying it here.
AFFIRMED.2
2 The county alternatively argues that Group V’s case should be dismissed un-
der the Tax Injunction Act. However, “[b]ecause we conclude that the comity
doctrine justifies dismissal of [Group V’s] federal-court action, we need not
decide whether the [Tax Injunction Act] would itself block the suit.”
Levin,
560 U.S. at 432 (“[A] federal court has flexibility to choose among threshold
grounds for dismissal.”).
USCA11 Case: 22-13246 Document: 23-1 Date Filed: 09/11/2023 Page: 7 of 7

-- 7 of 7 --