United States v. 2010-12-16 | 09-15759 | TODD LOWE V. WASHOE COUNTY | precedential | opinion |

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
 TODD LOWE; JANET LOWE; TOM
HENDERSON; NANCY HENDERSON; J.
ROBERT ANDERSON; CAROLE
ANDERSON; DEAN INGEMANSON,
Trustee of the Dean Ingemanson
Trust; KATHY NELSON, Trustee of
the Kathy Nelson Trust; and No. 09-15759
ARTHUR BERLINER, D.C. No.
Plaintiffs-Appellants, 3:08-cv-00217-KJD- 
v. RAM
WASHOE COUNTY, a political OPINION
subdivision of the State of
Nevada; JOSH WILSON, Washoe
County Assessor; and BILL
BERRUM, Washoe County
Treasurer,
Defendants-Appellees. 
Appeal from the United States District Court
for the District of Nevada
Kent J. Dawson, District Judge, Presiding
Argued and Submitted
October 8, 2010—San Francisco, California
Filed December 16, 2010
20219

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Before: Robert R. Beezer and Susan P. Graber,
Circuit Judges, and Cormac J. Carney,* District Judge.
Opinion by Judge Graber
*The Honorable Cormac J. Carney, United States District Judge for the
Central District of California, sitting by designation.
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COUNSEL
Suellen Fulstone, Reno, Nevada, for the plaintiffs-appellants.
Nathan J. Edwards, Deputy District Attorney, Reno, Nevada,
for the defendants-appellees.
OPINION
GRABER, Circuit Judge:
Plaintiffs Todd Lowe, Janet Lowe, Tom Henderson, Nancy
Henderson, J. Robert Anderson, Carole Anderson, Dean Inge-
manson, Kathy Nelson, and Arthur Berliner own residential
real property in Incline Village and Crystal Bay, which are
communities located on the North Shore of Lake Tahoe in
Washoe County, Nevada. As the putative representatives of a
class of approximately 9,000 Incline Village and Crystal Bay
property owners, the nine plaintiffs filed a complaint under 42
U.S.C. § 1983 in federal district court against Defendants
Washoe County, Washoe County Assessor Josh Wilson, and
Washoe County Treasurer Bill Berrum. Plaintiffs allege that
the valuation of their Nevada real property used to calculate
their ad valorem property taxes for the 2008-09 taxable year
violated both the Nevada Constitution and the Due Process
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Clause of the U.S. Constitution. They seek declaratory,
injunctive, and other appropriate relief. The district court dis-
missed the complaint for lack of subject matter jurisdiction
pursuant to the Tax Injunction Act (the “Act”), 28 U.S.C.
§ 1341, because a “plain, speedy and efficient remedy” is
available in state court. Reviewing de novo, A-1 Ambulance
Serv., Inc. v. California, 202 F.3d 1238, 1242-43 (9th Cir.
2000), we affirm.
FACTUAL AND PROCEDURAL HISTORY
A. Residents’ Past Challenges to the County Assessor’s
Valuation Methods
While the present case addresses only the 2008-09 tax year,
residents of Incline Village and Crystal Bay, including some
of the plaintiffs in this case, previously challenged in state
court the valuation methods employed by the Washoe County
Assessor. Nevada law provides four levels of review to an
aggrieved taxpayer. Property owners who disagree with the
County Assessor’s valuations of their property may file their
challenges for a given tax year with the appropriate County
Board of Equalization. Nev. Rev. Stat. §§ 361.340(11),
361.355-.357. If unsuccessful before the County Board, prop-
erty owners may appeal to the State Board of Equalization. Id.
§ 361.360. Dissatisfied property owners may then seek review
of the State Board’s decision in Nevada state trial court. Id.
§ 233B.130. If dissatisfied with the trial court decision, tax-
payers may appeal to the Nevada Supreme Court. Id.
§ 233B.150.
The County Assessor reappraises taxpayers’ real property
every five years. Id. § 361.260(6). In 2002, the Washoe
County Assessor conducted reappraisals of real property in
Incline Village and Crystal Bay; those findings served as the
base-year appraisals for the following five years beginning
with the 2003-04 tax year.
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Incline Village and Crystal Bay residents who disagreed
with the increase in their 2003-04 property valuations filed
individual petitions with the Washoe County Board of Equal-
ization. The residents claimed that the Assessor used valua-
tion methods that were neither promulgated in regulations by
the Nevada Tax Commission nor employed elsewhere in
Nevada. Though the residents’ claims were unsuccessful
before the County Board and the State Board, a Nevada trial
court reviewed those decisions and held that the 2003-04 tax
assessments were void because they violated the state consti-
tution’s guarantee of equal and uniform taxation. In 2006, the
Nevada Supreme Court affirmed the trial court’s decision.
State ex rel. State Bd. of Equalization v. Bakst, 148 P.3d 717
(Nev. 2006) ( en banc). The Nevada Supreme Court held that
the Assessor’s valuation methods were invalid under Article
10, Section 1, of the Nevada Constitution, which requires that
property be taxed according to a uniform and equal rate of
assessment. Id. at 721. The court awarded to the 17 individual
plaintiff-residents who remained in the case refunds of all
taxes attributable to the Assessor’s invalid methodologies and
ordered that the 2003-04 valuations be rolled back to the
2002-03 level. Id. at 726-27.
Incline Village and Crystal Bay taxpayers later filed indi-
vidual petitions challenging the Washoe County Assessor’s
2004-05 valuations, which relied on the same base-year
appraisal as that used for the 2003-04 valuations. The County
Board denied the taxpayers’ petitions, and the State Board
affirmed. Again, a state trial court reversed the State Board,
declaring the Assessor’s methods unconstitutional and the
resulting valuations void. Accordingly, the court directed that
refunds be paid to the approximately 37 taxpayers who
remained in the case. In July 2008, the Nevada Supreme
Court affirmed. That court held that the Assessor’s methods
continued to violate Article 10, Section 1, of the Nevada Con-
stitution because the 2002 reappraisal, previously declared
unconstitutional in Bakst, also served as the base-year
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appraisal for the 2004-05 valuations. State ex rel. State Bd. of
Equalization v. Barta, 188 P.3d 1092 (Nev. 2008) (en banc).
Incline Village and Crystal Bay residents later filed individ-
ual petitions challenging the Washoe County Assessor’s
2005-06, 2006-07, and 2007-08 valuations, all of which relied
on the same base-year appraisal as that used for the previous
two tax years. Those cases remain pending in state trial court.
Approximately 1,200 Incline Village and Crystal Bay taxpay-
ers are currently pursuing individual appeals in the 2005-06
case, and approximately 900 already have received partial
relief. Approximately 300 residents individually challenged
their 2006-07 valuations, and approximately 900 individually
challenged their 2007-08 valuations.
B. The 2008-09 Tax Year Valuations
In 2007, the Washoe County Assessor reappraised all
Incline Village and Crystal Bay residential real property for
the 2008-09 tax year, initiating the next five-year appraisal
cycle. Plaintiffs filed a class petition with the County Board.
In that petition, Plaintiffs claimed that the Assessor used the
same valuation methods in the 2007 reappraisal that previ-
ously had been declared unconstitutional by the Nevada
Supreme Court in Bakst and Barta. The County Board denied
Plaintiffs’ petition on the ground that the Board lacked juris-
diction to hear class petitions. Plaintiffs then filed this suit in
the United States District Court for the District of Nevada.
The federal district court granted Defendants’ Federal Rule
of Civil Procedure 12(b)(1) motion to dismiss for lack of sub-
ject matter jurisdiction. The court reached its ruling after
examining the administrative procedures and state court
review available to dissatisfied Nevada taxpayers who chal-
lenge ad valorem taxes. The taxpayers’ past successes before
the Nevada Supreme Court also persuaded the district court
that a “plain, speedy and efficient remedy” was available to
Plaintiffs in state court. Plaintiffs timely appealed.
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DISCUSSION
A. The Tax Injunction Act
[1] The Act provides that a district court “shall not enjoin,
suspend or restrain the assessment, levy or collection of any
tax under State law where a plain, speedy and efficient rem-
edy may be had in the courts of such State.” 28 U.S.C.
§ 1341. “[T]he statute has its roots in equity practice, in prin-
ciples of federalism, and in recognition of the imperative need
of a State to administer its own fiscal operations.” Tully v.
Griffin, Inc., 429 U.S. 68, 73 (1976). The Supreme Court
repeatedly has characterized the Act as a “ ‘broad jurisdic-
tional barrier,’ ” Arkansas v. Farm Credit Servs. of Cent. Ark.,
520 U.S. 821, 825 (1997) (quoting Moe v. Confederated
Salish & Kootenai Tribes of Flathead Reservation, 425 U.S.
463, 470 (1976)), which “limit[s] drastically federal district
court jurisdiction to interfere with so important a local con-
cern as the collection of taxes,” California v. Grace Brethren
Church, 457 U.S. 393, 408-09 (1982) (internal quotation
marks omitted). When applicable, the Act prohibits both
declaratory and injunctive relief, id. at 408, as well as § 1983
suits for damages, Fair Assessment in Real Estate Ass’n v.
McNary, 454 U.S. 100, 113 (1981).
[2] If a “plain, speedy and efficient remedy” is not avail-
able in state court, a federal district court may exercise juris-
diction over a party’s challenge to a state tax. Federal courts,
however, “must construe narrowly [this] exception to the
[Act].” Grace Brethren Church, 457 U.S. at 413. For the
Act’s jurisdictional prohibition to apply, the state court rem-
edy need only meet “certain minimal procedural criteria.”
Rosewell v. LaSalle Nat’l Bank, 450 U.S. 503, 512 (1981).
Specifically, the party challenging the state tax must have
access to “a full hearing and judicial determination” of all fed-
eral constitutional objections to the tax. Id. at 513 (internal
quotation marks omitted). The state court remedy need not be
“ ‘the best remedy available or even equal to or better than the
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remedy which might be available in the federal courts.’ ”
Mandel v. Hutchinson, 494 F.2d 364, 367 (9th Cir. 1974)
(quoting Bland v. McHann, 463 F.2d 21, 29 (5th Cir. 1972)).
[3] For a remedy to be “plain,” the procedures available in
state court must be certain. A state remedy “is not plain within
the meaning of the [Act]. . . ‘if there is uncertainty regarding
its availability or effect.’ ” Direct Mktg. Ass’n v. Bennett, 916
F.2d 1451, 1453 (9th Cir. 1990) (quoting Ashton v. Cory, 780
F.2d 816, 819 (9th Cir. 1986)). A remedy is “efficient” unless
it imposes an “unusual hardship . . . requiring ineffectual
activity or an unnecessary expenditure of time or energy.”
Rosewell, 450 U.S. at 518.
B. The Unavailability of a Class Action in State Court
[4] Plaintiffs first argue that Nevada’s remedy is inefficient
because class action suits to challenge ad valorem tax assess-
ments are not available in Nevada state court. We disagree.
Although filing a class action in federal court may be more
efficient than filing individual suits in state court, the state
court remedy need not be equal to or better than the remedy
available in federal court to qualify as “efficient” under the
Act. See Mandel, 494 F.2d at 367 (dismissing the plaintiff’s
argument that a state court remedy was inadequate because it
might require litigation involving 58 counties and several
thousand plaintiffs).
In support of their argument, Plaintiffs cite Garrett v. Bam-
ford, 538 F.2d 63 (3d Cir. 1976), in which the taxpayers
claimed that a Pennsylvania county’s method of calculating
property taxes was racially discriminatory. There, the Third
Circuit held that Pennsylvania failed to provide an efficient
remedy because no class action was available to the plaintiffs
in state court. Id. at 71-72. The court’s decision in Garrett,
however, was motivated primarily by the fact that the case
involved “systematic and intentional” racial discrimination
and that the cost of bringing individual suits would have been
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prohibitively expensive given the low economic status of the
putative class members. Id. Thus, as other courts have con-
cluded, Garrett may be limited to its facts. See Robinson Pro-
tective Alarm Co. v. City of Philadelphia, 581 F.2d 371, 378
n.15 (3d Cir. 1978) (distinguishing Garrett because it
involved “classifications which are constitutionally suspect,
triggering strict scrutiny”); see also Waldron v. Collins, 788
F.2d 736, 739 (11th Cir. 1986) (interpreting Garrett as apply-
ing only to cases where “state tax codes utilize classifications
which are constitutionally suspect” and holding that the State
of Georgia’s procedures were not inadequate despite the
unavailability of a class action).
[5] In any case, we are neither bound nor persuaded by
Garrett in the present context. If an adequate state court rem-
edy is available to individual taxpayers, the Act’s jurisdic-
tional prohibition applies despite the availability of a more
efficient federal remedy. We agree with the district court that,
as to individual taxpayers, Nevada’s administrative and judi-
cial review process provides an effective and adequate means
by which a dissatisfied taxpayer may contest his property val-
uation. The previous success of numerous taxpayers in chal-
lenging such valuations further persuades us that individual
taxpayers have access to a plain, speedy, and efficient state
court remedy. We therefore hold that, because the state court
remedy available to individual Nevada taxpayers is adequate,
the absence of a class-wide remedy does not render the state
court remedy inefficient within the meaning of the Act.
C. The Multiplicity-of-Suits Exception
Plaintiffs next argue that the state remedy is inadequate
because taxpayers must file repetitive suits year after year to
challenge a tax that the Nevada Supreme Court twice has
declared unconstitutional. Citing National Private Truck
Council, Inc. v. Oklahoma Tax Commission, 515 U.S. 582
(1995), Plaintiffs argue that the “multiplicity-of-suits” excep-
tion to the Act allows for federal jurisdiction over their
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claims. In National Private Truck Council, the Supreme Court
stated in a footnote:
[I]f the enforcement of the tax would lead to a multi-
plicity of suits, . . . equity might be invoked. As we
have made clear, however, the multiplicity-of-suits
rationale for permitting equitable relief extends only
to those situations where there is a real risk of
numerous suits between the same parties, involving
the same issues of law or fact. Thus, if a state court
awards a refund to a taxpayer on the ground that the
tax violates the Federal Constitution, but state tax
authorities continue to impose the unconstitutional
tax, injunctive and declaratory relief might then be
appropriate. In such circumstances, the remedy
might be thought to be inadequate.
Id. at 591 n.6 (citations and internal quotation marks omitted).
[6] Plaintiffs also rely on our decision in Patel v. City of
San Bernardino, 310 F.3d 1138 (9th Cir. 2002). In Patel, the
City of San Bernardino continued to collect a transient occu-
pancy tax for several months after a California Court of
Appeal decision invalidated the tax on federal due process
grounds. Id. at 1142. On those facts, we held that a state court
remedy is uncertain and inadequate when a tax continues to
be collected after a state court has determined that the tax vio-
lates the Federal Constitution. Id.
[7] Unlike the situation described in National Private
Truck Council and presented by Patel, this case does not
involve the same issues of law and fact previously adjudicated
by a state court. The Nevada Supreme Court’s decisions in
Bakst and Barta addressed only the Assessor’s 2002 appraisal
of Plaintiffs’ real property. The Assessor’s new, separate 2007
appraisal has never been declared invalid by a Nevada court.
Thus, unlike the city-defendant in Patel, Defendants here did
not continue to collect a tax that a state court previously had
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declared invalid. Consequently, Plaintiffs have not demon-
strated that the state court remedy in this case is uncertain and
therefore not “plain.”1
D. The State Board of Equalization as Adverse
Fact-Finder
Finally, Plaintiffs maintain that the state court cannot afford
them a full and fair hearing because the State Board of Equal-
ization is the primary fact-finder in the state administrative
process and the State Board has been adverse to the taxpayers
in state court cases, some of which remain pending. We are
unpersuaded.
[8] Plaintiffs’ claims of bias do not impeach the adequacy
of the state court remedy, which is the lens through which 28
U.S.C. § 1341 tells us to look. Plaintiffs have not established
that Nevada state courts are incapable of reviewing and, when
appropriate, remedying any bias exhibited by the State Board
in its fact-finding process. We therefore reject Plaintiffs’
argument that the State Board’s allegedly biased fact-finding
1We further note that the dictum in National Private Truck Council and
the holding in Patel concern situations in which a state court declared a
tax invalid under the Federal Constitution. Here, no state court has ruled
that the Assessor’s valuation methods violated the Federal Constitution.
Indeed, the Nevada Supreme Court rulings in Barta and Bakst address
only a provision in the state constitution that is not analogous to any fed-
eral constitutional guarantee. Given that no federal right was directly at
issue in Bakst and Barta, the Act’s underlying policies of federalism and
comity would seem to recommend against federal interference. See Nat’l
Private Truck Council, 515 U.S. at 586 (“[P]rinciples of federalism and
comity generally counsel that courts should adopt a hands-off approach
with respect to state tax administration.”); Rosewell, 450 U.S. at 513-15
(holding that the Act’s exception requires that the state provide a full hear-
ing and judicial determination of any and all federal constitutional objec-
tions). Because the present case involves issues of law and fact not
presented in Bakst and Barta, we need not decide whether the state-law
basis of those holdings further distinguishes Patel and National Private
Truck Council.
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denies Nevada taxpayers a plain, speedy, and efficient remedy
in the state court.
AFFIRMED.
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