This case stems from a long-running land-use dispute in New Hanover, Pennsylvania, involving a group of real estate companies and investors known as the Developers. They sought to develop approximately 230 acres of property into a mixed-use project. Although they received preliminary approval for one plan in 2007, the projects stalled, leading to various state lawsuits. In March 2024, the Developers filed a federal lawsuit under 42 U.S.C. § 1983 against the Township and its officials. They alleged that the Township engaged in a campaign to obstruct their projects to limit racial diversity, citing onerous ordinances, denied extensions, and arbitrary plan denials. The District Court dismissed these claims, and the Developers appealed to the Third Circuit.
The Third Circuit, in a per curiam opinion by Judge Hardiman, affirmed the dismissal primarily on two grounds. First, the court addressed the statute of limitations. Under Pennsylvania law, § 1983 claims must be filed within two years. The Developers argued that a 'continuing violation doctrine' should toll this deadline, pointing to a June 2022 settlement offer and an October 2023 engineering letter as ongoing unlawful acts. The court rejected this, citing precedent that the continuing violation doctrine does not apply when the plaintiff is aware of the injury when it occurs. Since the Developers were aware of the alleged injuries as far back as 2018 and had engaged in state litigation by 2020, they could have sued earlier. The court characterized the settlement offer and the engineering letter as discrete acts that could not revive time-barred claims. Second, the court evaluated the substantive due process and equal protection claims based on the two recent acts. For substantive due process, the court reiterated that land-use disputes are matters of local concern and only become federal violations if the conduct 'shocks the conscience.' The court found that an engineer's letter referencing an ordinance and a standard settlement offer did not rise to the level of egregious official conduct required. For the equal protection claim, the court noted that the Developers failed to allege they were treated differently from similarly situated developers. The complaint itself admitted that the Township had stopped all major development plans, suggesting a general halt rather than discriminatory targeting. Consequently, the conspiracy claims also failed as they were predicated on the underlying offenses.
The decision reinforces the strict application of the statute of limitations in § 1983 land-use cases, clarifying that the continuing violation doctrine is unavailable to plaintiffs who were aware of their injuries years prior. It also sets a high bar for substantive due process claims in zoning disputes, requiring conduct that 'shocks the conscience' rather than mere procedural delays or standard negotiations. The ruling effectively insulates municipal land-use decisions from federal constitutional challenges unless there is clear evidence of conscience-shocking behavior or discriminatory treatment of similarly situated developers. The case is remanded with instructions to dismiss the complaint, leaving the Developers without a federal forum for their claims.
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