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Bayou Vista, LLC v. City of Oxford

United States District Court, N.D. Mississippi, Oxford Division

March 27, 2018




         This cause comes before the court upon the defendant's motion to dismiss for lack of subject matter jurisdiction and for failure to state a claim. Upon due consideration of the motion, response, and applicable authority, the court is ready to rule.

         Factual and Procedural Background

         The plaintiff, Bayou Vista, LLC, (“Bayou”) owns a vacant sixteen-square-foot parcel of property within the limits of the City of Oxford, the defendant in this action. The property previously contained a billboard, but no billboard has existed on the property since approximately a year prior to the plaintiff's acquiring it by virtue of a sheriff's deed dated December 15, 2015. The previous owner of the parcel was Sun South, LLC. The property was originally outside the city limits of Oxford but was annexed in 2006. Bayou brings this action to challenge the constitutionality of a sign ordinance adopted by the City in 2013. Bayou seeks a declaratory judgment, injunctive relief, and damages for alleged violations of its federal and state constitutional rights, asserting that the defendant's actions amount to a taking without just compensation.

         The City enacted an ordinance in 1990 limiting all new billboards to industrial zones. All existing, non-compliant billboards were grandfathered under this ordinance. In 2004, the City amended its Land Development Code to require the removal of non-conforming signs, including billboards, within a five-year amortization period. This period was extended by an additional two years in 2009. After this period expired, Lamar OCI South Corporation (“Lamar”), which is not a party to the present litigation, filed two lawsuits against the City seeking a declaratory judgment that the City's sign ordinance was unconstitutional and seeking damages for the removal of eleven non-compliant billboards Lamar owned and operated within the City.

         Lamar and the City reached an agreement to settle these lawsuits in late 2013 while the cases were pending in federal court. As part of the settlement agreement, the City enacted an ordinance allowing Lamar to place two digital billboards in certain areas of the City under restricted circumstances and parameters. The signs could only be placed on property located on Highway 6 in an area zoned General Business no less than 1000 linear feet apart, nowhere east of County Road 165 on the north side of Highway 6 and nowhere east of Thacker Road on the south side of Highway 6. Any landowner whose property did not meet these conditions was not permitted to erect or maintain a billboard structure. The ordinance further provides as follows:

A total of two back to back digital billboards shall be permitted on Hwy 6 West in an area zoned general business in accordance with the regulations included in this Section and upon issuance of a permit by the City. No. permit for a digital sign shall be issued unless the applicant first demonstrates the removal of no less than four existing non-conforming billboards located within the City of Oxford. A second permit for a digital billboard shall not be issued unless the applicant has demonstrated the removal of four additional existing non-conforming billboards located within the City of Oxford. All non-conforming billboards within the City of Oxford shall be removed within a 12-month period from the adoption of this Section.

         [Doc. 11-4]. At the time this ordinance was passed, a billboard was situated on the subject property and was allegedly generating income. In accordance with the terms of the settlement agreement and the 2013 ordinance, Lamar removed the billboard from this property in 2014.

         The ordinance was read before the public at an open meeting on September 3, 2013. A public hearing on the proposed ordinance was held on September 17, 2013, and the City voted to pass the ordinance in an open meeting on October 15, 2013. The ordinance not only settled the Lamar litigation, it guaranteed a drastic reduction in the number of non-conforming billboards within the City limits. Lamar removed the billboard from the subject property on September 30, 2014, and canceled its lease agreement with Bayou's predecessor in interest on October 1, 2014.

         Standard of Review

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “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.

         “Motions to dismiss under Rule 12(b)(6) are viewed with disfavor and are rarely granted.” Lormand v. U.S. Unwired, Inc., 565 F.3d 228, 232-33 (5th Cir. 2009). A court must accept all well-pleaded facts as true and must draw all reasonable inferences in favor of the plaintiff. Id. But the court is not bound to accept as true legal conclusions couched as factual allegations. Iqbal, 556 U.S. at 678.

         In ruling on a Rule 12(b)(6) motion to dismiss, the court generally may not look beyond the pleadings. Cinel v. Connick, 15 F.3d 1338, 1341 (5th Cir. 1994). Matters of public record and matters of which the court may take judicial notice as well as documents attached to the complaint are exceptions. Id. at 1343 n.6; Lovelace v. Software Spectrum, Inc., 78 F.3d 1015, 1017 (5th Cir. 1996). Further, “[d]ocuments that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in ...

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