Fairness Hearings Citizen Participation Act

Real Estate and Land Use LitigationLaw Seminars International

March 1, 2012

© 2012 Richard F. Friedman. All rights reserved.

Richard F. FriedmanNeal & Leroy, LLCChicago, Illinois

Fairness Hearings

Singapore Dunes

Singapore Dunes, LLC v. Suagatuk Twp., 1:10-CV-210 W.D. Mich).

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Settlement Factors other than the Public Interest

Considerations other than the public interest may be factors in the settlement:

Cost savings by discontinuing the litigation. Quick exit from the litigation. Avoidance of controversy. Obtaining court “cover” for a result not available

by other means. Lack of information so that the court and parties

can know the wider impact of the settlement.

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What is a fairness hearing?

Public notice of the terms of the potential settlement of litigation.

Opportunity for the public to provide input In writing. And/or in testimony before the court.

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Fairness hearings for settlements involving the government.

Zoning.Environmental.Transportation.Landmarks and other protected

historic resources.

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Fairness hearings for settlements involving only private parties

Public trusts.

Charitable trusts.

Trusts Enforceable by the Attorney General. No requirement for public input. Enforcement discretionary by the A.G.

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No uniform standard for decree approval

"Fair, reasonable, adequate, consistent with applicable law.” Metro. Housing Dev. Corp. v. Vil. Arlington Hts., 616 F.2d 1006 (7th Cir. 1980).

Public interest: "adequately protects and is consistent with the public interest" U.S. v. BP Exploration & Oil Co., 167 F.Supp.2d 1045 (N.D. Ind. 2001); U.S. v County of Muskegon, 298 F.3d 569 (6th Cir. 2002).

No uniform recognition of fairness hearing

No general mechanism or procedure for applying public interest standard.

U.S. v. BP Exploration & Oil Co., 167 F.Supp.2d 1045 (N.D. Ind. 2001) hearing not necessary (but notice published and comments received).

U.S. v. City of Akron, 794 F.Supp.2d 782 (N.D. Ohio 2011) 2-day fairness hearing conducted.

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Fairness hear required—class action settlements

Fed class action settlements - Rule 23(e) notice to class members of proposed

settlement. hearing . finding of “fair, reasonable, and

adequate.“affected class is already before the

court through class representative. Illinois class actions has no similar

law, but courts generally follow Fed. Procedure.

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Federal environmental litigation settlements

28 CFR Sec. 50.7. Proposed settlement must be lodged

with court . U.S. Dept. Justice will receive, consider

and file with the court all written comments.

No provision for hearing or taking testimony.

Illinois land use disputes—limited opportunties for fairness hearings

Notice, hearing and administrative review available for certain Zoning.▪ see Div. 13 of Ill. Munic. Code. 65 ILCS 5/11-13-1

et seq. for notices and hearings. Landmarking. Environmental.

Parties of record (or applicants) appearing before admin. agency are parties in administrative review cases. 735 ILCS 5/3-107.

Illinois land use disputes—limited opportunities for fairness hearings

Limits to public input in land use court settlements. Interested (lay) parties may choose not to

appear in administrative review. Different issues may arise in the proposed

decree. Appearing by counsel is expensive. Appearing members of the public may not be

aware of the settlement negotiations. Affected members of public outside the

geographic limits in the original proceeding.13

Illinois public input in land use disputes—when not required

De novo review of all zoning decisions as legislative action. 65 ILCS 5/11-13-25. Deferential review may exclude pubic

input. Injunction.Mandamus.Declaratory (except certain zoning).

Proposed fairness hearing standard

Prior to approving a settlement agreement affecting the public interest, the court shall hold a fairness hearing.

A matter “affecting the public interest” means substantially modifying a zoning, environmental, landmarking or other land use regulation affecting a particular parcel of property or the terms of a charitable or public trust.

A fairness hearing shall be held no less than 30 days after publishing the proposed settlement in a newspaper of general circulation in the affected community.

An person may submit written comments or testimony at the fairness hearing in accordance with procedures established by the court.

The court shall approve a settlement agreement unless it is not fair, reasonable and adequately protects and is consistent with the public interest.

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Citizen Participation Act

735 ILCS 110/1 et seq.

Effective August 28, 2007.

Immunity nullified by Sandholm v. Kueker, 2012 IL 111443, announced January 20, 2012.

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SLAPP suits

Strategic Lawsuits Against Public Participation

Legislative finding that SLAPPs and threat of SLAPPs significantly chill citizens’ participation in government. Sec. 5.

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Common types of SLAPPs

Defamation. Interference with contract . Interference with prospective

economic advantage. Intentional infliction of emotional

harm.Anti-trust.Conspiracy.

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Immunity for SLAPP defendants “Acts in furtherance of the

constitutional rights to petition, speech, association, and participation in government are immune from liability, regardless of intent or purpose, except when not genuinely aimed at procuring favorable government action, result, or outcome.” 735 ILCS 110/15.

Broader than other states’ SLAPP acts. Hytel Group, Inc. v. Butler, 405 Ill.App.3d 126 (2d Dist. 2010). 19

CPA defense motions expedited

Must be decided by court within 90 days of noticing the motion. 735 ILCS 11/20(a).

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No immunity against legitimate claims

Sandholm v. Kuecker 2012 IL 111433.

Immunity is not total; damages available where plaintiff is “genuinely seeking relief.” “Substantial basis other than petitioning

activities.”Defendant has initial burden of proof

before presumption arises.CPA is properly raised as an other

affirmative matter in a 2-619(a)(9) motion.

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CPA’s chilling effect on legitimate claims

All speech and activities in context of public issues immunized under the terms of CPA, regardless of harm.

Adopts Noerr-Pennington doctrine: “except when not genuinely aimed” at procuring government action. Eastern Railroad Presidents Conference v. Noerr Motor

Freight, Inc., 365 U.S. 127, 135 (1961); United Mine Workers v. Pennington, 381 U.S. 657, 670 (1965).

Presumption for defendant unless plaintiff produces clear and convincing evidence. 735 ILCS 110/20(c). Query, how does plaintiff produce evidence in

response to motion to dismiss?22

Immediate appeal

Sec. 20(a) Purports to permit interlocutory appeal.

Providing for appeal from non-final order exceeds the legislature’s authority. Mund v. Brown, 393 Ill.App.3d 994 (5th

Dist. 2009). Stein v. Krislov, 405 Ill.App.3d 538 (1st

Dist.2010).

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Attorneys fees award

Reasonable attorneys fees and costs awarded to defendant in connection with motion. 735 ILCS 110/25. Note: to moving party, not prevailing

party.Only attorneys fees related to the

motion, not the entire case, may be awared under the CPA. Sandholm v. Kuecker 2012 IL 111433.

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For more information

Richard F. Friedmanattorney at law

203 N. LaSalle St. Suite 2300Chicago, IL 60601

312 641-7144

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