other documentation to the DCP and the TA on or about May 5,
1987. Exhibit L to Affirmation of Mario A. Fristachi, filed
April 29, 1991. Plaintiffs and the DCP never exchanged the
information necessary to determine the exact dimensions of the
easement. The parties disagree as to who is responsible for
this failure of communication.
In October 1987, the New York City Board of Estimate
approved an amendment to the Zoning Resolution, by which the
area surrounding plaintiffs' property was down-zoned from R8
to R8B. As pointed out above, the 17-story building proposed
by plaintiffs was no longer permitted under the new
classification. In 1988, plaintiffs sold the property for
approximately $12,000,000. The DCP thereafter formally
terminated the application for easement certification.
Plaintiffs initiated the instant lawsuit on July 28, 1989
and subsequently amended their complaint on September 26,
1990. The Amended Complaint alleges that the DCP and CPC, in
furtherance of a City policy of discouraging mid-block real
estate development in east midtown, adopted a plan designed to
prevent plaintiffs' development project, by illegal or
unconstitutional means if necessary. According to the Amended
Complaint, pursuant to this plan, the DCP determined that it
would claim a transit easement through plaintiffs' proposed
development site, delay the City's action on such easement
administratively and delay issuance of plaintiffs' building
permit, until such time as the area including the site had
been down-zoned so as to make plaintiffs' proposed development
illegal. Plaintiffs claim that defendants' actions violated
their rights to substantive and procedural due process and
equal protection of the laws and amounted to an
unconstitutional taking, in addition to violating their rights
under the New York State constitution. The complaint seeks
compensatory damages in the amount of $26,000,000, for losses
plaintiffs claim they sustained on their investment as well as
for lost profits had the project gone forward as planned.
Plaintiffs also seek reasonable attorneys' fees pursuant to
42 U.S.C. § 1988.
Following the completion of discovery, defendants moved for
summary judgment, claiming that they are entitled to judgment
as a matter of law, or alternatively, that the evidence
produced in discovery reveals that they acted legally at all
times. Plaintiff subsequently cross-moved for partial summary
judgment on the question of liability.
The standards for granting summary judgment in this Circuit
are well-established. A court may grant this extraordinary
remedy only when it is clear both that no genuine issue of
material fact remains to be resolved at trial and that the
movant is entitled to judgment as a matter of law. Rule 56,
Fed.R.Civ.P. In deciding the motion, the Court is not to
resolve disputed issues of fact, but rather, while resolving
ambiguities and drawing reasonable inferences against the
moving party, to assess whether material factual issues remain
for the trier of fact. Knight v. U.S. Fire Ins. Co.,
804 F.2d 9, 11 (2d Cir. 1986) cert. denied, 480 U.S. 932, 107 S.Ct.
1570, 94 L.Ed.2d 762 (1987) (citing Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 247-50, 106 S.Ct. 2505, 2509-11, 91 L.Ed.2d
202 (1986)). Only where the entire record would inevitably lead
a rational trier of fact to find for the moving party is
summary judgment warranted. National Railroad Passenger Corp.
v. City of New York, 882 F.2d 710 (2d Cir. 1989).
While the party seeking summary judgment bears the burden of
demonstrating the lack of material factual issues in dispute,
Schering Corp. v. Home Ins. Co., 712 F.2d 4, 9 (2d Cir. 1983),
"the mere existence of factual issues — where those issues are
not material claims before the court — will not suffice to
defeat a motion for summary judgment." Quarles v. General
Motors Corp. 758 F.2d 839, 840 (2d Cir. 1985) (per curiam).
Although the movant faces a difficult burden to succeed,
motions for summary judgment, properly employed, permit a
court to terminate frivolous claims and defenses, and to
concentrate its resources on meritorious litigation.
Knight v. U.S. Fire Ins. Co., supra, 804 F.2d at 12. The motion
is properly regarded not as a disfavored
procedural shortcut, but rather as an integral
part of the Federal Rules as a whole, which are
designed "to secure the just, speedy and
inexpensive determination of every action."
Fed.Rule Civ.Pro. 1 . . . Rule 56 must be
construed with due regard not only for the rights
of persons asserting claims and defenses that are
adequately based in fact to have those claims and
defenses tried to a jury, but also for the rights
of persons opposing such claims and defenses to
demonstrate in the manner provided by the Rule,
prior to trial, that the claims and defenses have
no factual basis.
Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548,
2555, 91 L.Ed.2d 265 (1986).
A. The Substantive Due Process Claims
In order to state a substantive due process claim, a party
must first establish that he had a valid "property interest"
in a benefit that was entitled to constitutional protection at
the time he was deprived of that benefit. Brady v. Town of
Colchester, 863 F.2d 205, 211-12 (2d Cir. 1988) (citing Board
of Regents v. Roth, 408 U.S. 564, 576-77, 92 S.Ct. 2701,
2708-09, 33 L.Ed.2d 548 (1972)). Since property interests are
not created by the Constitution, federal courts must look
instead to "existing rules or understandings that stem from . .
. state law — rules or understandings that secure certain
benefits and that support claims of entitlement to those
benefits" in deciding whether such a property interest existed.
Board of Regents v. Roth, supra, 408 U.S. at 577, 92 S.Ct. at
In the context of a due process claim involving the failure
of a state administrative agency to issue a permit, this
circuit uses an entitlement analysis to determine whether a
party's interest in the permit's issuance is protectible under
the Fourteenth Amendment. See Natale v. Town of Ridgefield,
927 F.2d 101, 105 (2d Cir. 1991); Greene v. Town of Blooming Grove,
879 F.2d 1061, 1065 (2d Cir. 1989). The entitlement test was
first articulated by the Court of Appeals in Yale Auto Parts,
Inc. v. Johnson, 758 F.2d 54, 59 (2d Cir. 1985):
[T]he question of whether an applicant has a
legitimate claim of entitlement to the issuance
of a license or certificate should depend on
whether, absent the alleged denial of due
process, there is either a certainty or a very
strong likelihood that the application would have
been granted. Otherwise the application would
amount to a mere unilateral expectancy not rising
to the level of a property right guaranteed
against deprivation by the Fourteenth Amendment.
The analysis thus focuses on the extent to which the issuing
authority may exercise its discretion in arriving at a
decision rather than on an estimate of the probability that
the authority will make a specific decision. RRI Realty Corp.
v. Inc. Village of Southampton,