United States District Court, D. Colorado
ORDER
PHILIP
A. BRIMMER, CHIEF JUDGE
This
matter is before the Court on Defendants' Motion to
Dismiss Third Amended Complaint [Docket No. 72]. The Court
has jurisdiction pursuant to 28 U.S.C. § 1331.
I.
BACKGROUND[1]
This
case arises out of claims for income tax credits for
conservation easements pursuant to Colo. Rev. Stat. §
39-22-522. The background of this statutory scheme and of
this case is explained in the Court's order on
defendants' motion to dismiss plaintiff's second
amended complaint. Docket No. 54 at 1-2. Plaintiff is an
advocacy organization that claims the Colorado Department of
Revenue and the Colorado Conservation Easement Oversight
Commission unlawfully administered the conservation easement
tax credit program in violation of its members' rights
under the United States Constitution. Docket No. 67 at 5-6,
¶¶ 10-11.
After
the Court dismissed plaintiff's second amended complaint
on March 17, 2017, plaintiff filed a motion to amend the
complaint. Docket No. 56. On February 28, 2018, the Court
granted in part and denied in part plaintiff's motion to
amend the complaint. Docket No. 66. The Court concluded that
plaintiff had demonstrated organizational standing to sue on
behalf of its aggrieved members. Id. at 5. On March
12, 2018, plaintiff filed its Third Amended Complaint. Docket
No. 67. Plaintiff asserts four causes of action: (1)
deprivation of equal protection under 42 U.S.C. § 1983;
(2) violation of due process under 42 U.S.C. § 1983; (3)
violation of the Takings Clause of the Fifth Amendment to the
United States Constitution; and (4) a request for declaratory
relief. Id. at 15-22. Plaintiff seeks prospective
injunctive relief as well as declaratory relief. Id.
In
their motion to dismiss, defendants argue that: (1)
defendants Marcia Waters, Mark Weston, and Peter Ericson are
immune from suit under the Eleventh Amendment; (2)
plaintiff's claims are barred by the Tax Injunction Act,
28 U.S.C. § 1341; (3) plaintiff's claims are barred
by the comity doctrine; and (4) plaintiff fails to state a
claim for which relief can be granted. Docket No. 72.
On May
29, 2018, Colorado Governor John W. Hickenlooper signed into
law House Bill 18-1291. Docket No. 90-1. The bill repeals the
Division of Real Estate's statutory authority to oversee
the conservation easement tax credit program and vests that
authority in a new Division of Conservation. Id. The
bill also abolishes the nine- member conservation easement
commission that previously existed within the Division of
Real Estate. Id. On September 28, 2018, defendants
filed a notice of supplemental authority, arguing that the
claims against Waters, Weston, and Ericson are moot due to
the enactment of H.B. 18-1291. Docket No. 90.
II.
ANALYSIS
A.
Mootness
Waters,
Weston, and Ericson argue that the claims against them in
their official capacities are now moot due to the enactment
of H.B. 18-1291. Docket No. 90.
A case
is moot when the issues presented are no longer
“live.” Powell v. McCormack, 395 U.S.
486, 496 (1969). A court lacks jurisdiction to consider any
case that has “lost its character as a present, live
controversy.” Hall v. Beals, 396 U.S. 45, 48
(1969). Because the exercise of judicial power under Article
III of the Constitution depends on the existence of a live
controversy, mootness is a jurisdictional issue. Lewis v.
Cont'l Bank Corp., 494 U.S. 472, 477 (1990).
“The hallmark of a moot case or controversy is that the
relief sought can no longer be given or is no longer
needed.” U.Sch. Dist. No. 259, Sedgwick Cty., Kan.
v. Disability Rights Center of Kan., 491 F.3d 1143, 1150
(10th Cir. 2007) (quotations omitted).
Based
upon the enactment of H.B. 18-1291, the Court finds that the
claims against Waters, Weston, and Ericson are moot in that a
live controversy no longer exists. H.B. 18-1291 repeals the
Division of Real Estate's statutory authority to oversee
the conservation easement tax credit program and vests that
authority in a new Division of Conservation. See
Docket No. 90-1. Accordingly Waters, Weston, and Ericson,
whose connection to the conservation easement tax credit
program arose from their official roles within the Division
of Real Estate, no longer have any official duties related to
the conservation easement tax credit program.[2] The Court could
not enter prospective injunctive and declaratory relief
against those defendants that would “have some effect
in the real world.” See U.Sch. Dist. No. 259,
491 F.3d at 1147. Thus, the Court must dismiss the claims
without prejudice for lack of subject matter jurisdiction
against Waters, Weston, and Ericson in their official
capacities.[3]
B.
Tax Injunction Act
Defendants
argue that plaintiff's claim is barred by the Tax
Injunction Act ...