Stevens v. St. Tammany Parish Gov't

17 F.4th 563

Terri Lewis STEVENS; Craig Rivera; Jennifer Rivera, Plaintiffs—Appellants,

v.ST. TAMMANY PARISH GOVERNMENT, Defendant—Appellee.

No. 20-30644

United States Court of Appeals, Fifth Circuit.

FILED November 3, 2021

Louis Roy Koerner, Jr., Koerner Law Firm, New Orleans, LA, for Plaintiffs—Appellants.

James L. Bradford, III, Esq., Donald Stephen Brouillette, Jr., Daigle Fisse & Kessenich, P.L.C., Madisonville, LA, Kirk Norris Aurandt, Esq., Daigle Fisse & Kessenich, Covington, LA, for Defendant—Appellee.

Before King, Higginson, and Wilson, Circuit Judges.

Stephen A. Higginson, Circuit Judge:

This is the second suit in a multi-year litigation between three property owners and the St. Tammany Parish Government ("St. Tammany"). The dispute involves sewage and stormwater that allegedly flows through plaintiffs-appellants’ ("plaintiffs") properties and into various creeks, rivers, and waterways in Louisiana. The first suit was filed in Louisiana state court in 2015. The state trial court entered judgment against plaintiffs in that suit in August 2018. Two years later, plaintiffs filed this suit in federal court, asserting largely the same state law claims plus claims under the federal Clean Water Act ("CWA").

The federal district court dismissed the state law claims as precluded by res judicata, dismissed the CWA claims under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim, and denied plaintiffs’ motions for injunctive relief. It further denied plaintiffs’ subsequent Rule 59(e) motion for reconsideration, which included a request for leave to file a third amended complaint. We AFFIRM.

I.

Plaintiffs Terri Lewis Stevens, Craig Rivera, and Jennifer Rivera live on adjoining properties located on Dove Park Road, in Covington, Louisiana. They complain of various "acts of man" related to the development of Dove Park Road, which began in 1993, and continued with additional development of the nearby Dove Park Subdivision in 2000, 2003, 2011, and 2015. The most recent complained-of project is the 2015 Dove Park road widening, "which widened a portion of the Dove Park Road and required the culverting of roadside ditches."

Plaintiffs allege that "sanitary sewer overflows ... and other pollutants are conveyed by [St. Tammany Parish Government's] drainage ditches to a catch basin" that flows to the Stevens property, then to the Rivera property, and then into various "waters of the United States." They further allege that these discharges increase the storm and sewage burden on plaintiffs’ properties and pose health risks to plaintiffs and others.

Plaintiffs filed their first suit in Louisiana state court on February 18, 2015, in the 22nd Judicial District Court for St. Tammany Parish, Louisiana. As the district court explained, they "sought relief on five different claims: (1) violation of [their] natural servitude; (2) deprivation of rights guaranteed by the U.S. Constitution and the Louisiana Constitution; (3) intentional damage to property and mental anguish; (4) possessory action; and (5) unfair trade practices under La. R.S. 51:1405." Plaintiffs sought both damages and injunctive relief.

After several years of litigation, the state trial court denied all relief and, on August 17, 2018, entered final judgment in favor of St. Tammany and against plaintiffs. Plaintiffs appealed that state court judgment. On April 8, 2021, the Louisiana First Circuit Court of Appeal affirmed. Stevens v. St. Tammany Par. Gov't , 322 So. 3d 1268, 1275 (La. Ct. App. 2021). Plaintiffs then filed an application for a writ of certiorari in the Louisiana Supreme Court, which remains pending.

Before the Louisiana First Circuit Court of Appeal had issued its decision, plaintiffs commenced this suit (the "second suit") in federal court. They again sued St. Tammany, as well as the Louisiana Department of Environmental Quality ("LDEQ"), for claims arising from the same "acts of man" asserted in the state court suit and for the same sewage and storm burden on their properties. Specifically, in federal court, plaintiffs asserted claims against St. Tammany for past and ongoing violations of the CWA, 33 U.S.C. § 1251 et seq. ;¹ violations of the Louisiana Pollution Discharge Elimination System ("LPDES") Permit No. LAR04000; and failure to enforce the permit, the CWA, and applicable state laws.

In these federal proceedings, plaintiffs filed their initial complaint on March 17, 2020 and then a first amended complaint on April 27, 2020. They also moved for preliminary and permanent injunctions against both St. Tammany and LDEQ. St. Tammany and LDEQ separately moved to dismiss the first amended complaint. St. Tammany argued that the complaint both was barred by res judicata and failed to state a claim under Federal Rule of Civil Procedure 12(b)(6), while LDEQ maintained that it was entitled to sovereign immunity under the Eleventh Amendment and, alternatively, that the complaint failed to state a claim. Plaintiffs did not oppose the motions, but instead moved for leave to file a second amended complaint (which both St. Tammany and LDEQ opposed) and otherwise asserted that the motions to dismiss were moot. They subsequently voluntarily dismissed without prejudice defendant LDEQ pursuant to Federal Rule of Civil Procedure Rule 41(A)(1)(a)(i).

On July 23, 2020, with LDEQ no longer a party to the case, the district court granted St. Tammany's motion to dismiss, concluding that that the non-CWA claims were precluded under res judicata by the state court litigation and that the CWA allegations in the first and second amended complaints failed to state a plausible claim. In a separate order, the district court denied the motion for injunctive relief. That same day, the court entered final judgment against plaintiffs.² The court subsequently denied plaintiffs’ Rule 59(e) motion for reconsideration, which included a request for leave to file a third amended complaint. This timely appeal followed.

II.

The district court had subject matter jurisdiction over plaintiffs’ federal claims and supplemental jurisdiction over their state law claims. See 28 U.S.C. §§ 1331, 1367(a). We have jurisdiction to review final judgments of a district court pursuant to 28 U.S.C. § 1291.³

III.

On appeal, plaintiffs challenge (1) the dismissal of their non-CWA claims as barred by res judicata; (2) the dismissal of their CWA allegations for failure to state a claim under Rule 12(b)(6) ; (3) the denial of leave to file a third amended complaint following dismissal of their claims; and (4) the denial of injunctive relief. We address each issue in turn.

A.

"A district court's grant of a motion to dismiss is reviewed de novo." Budhathoki v. Nielsen , 898 F.3d 504, 507 (5th Cir. 2018). Likewise, "[t]he res judicata effect of a prior judgment is a question of law that this court reviews de novo." Test Masters Educ. Servs., Inc. v. Singh , 428 F.3d 559, 571 (5th Cir. 2005).

On appeal, plaintiffs challenge whether it was error for the district court to consider res judicata arguments asserted in a motion to dismiss. Plaintiffs also argue that the state court judgment is not "final," that the causes of action asserted in the second suit did not "exist[ ] at the time" of the state court judgment, and that those causes of action did not arise out of the same transaction or occurrence as the state court litigation.

1.

"The rule of res judicata encompasses two separate but linked preclusive doctrines: (1) true res judicata or claim preclusion and (2) collateral estoppel or issue preclusion." Test Masters , 428 F.3d at 571. This appeal involves only the former. "Claim preclusion, or res judicata, bars the litigation of claims that either have been litigated or should have been raised in an earlier suit." Id.

Louisiana law applies to determine whether the Louisiana state court judgment in plaintiffs’ suit has preclusive effect in federal court. See Lafreniere Park Found. v. Broussard , 221 F.3d 804, 808 (5th Cir. 2000) ("To determine the preclusive effect of a prior Louisiana court judgment, if any, this court must apply Louisiana law."); Weaver v. Texas Cap. Bank N.A. , 660 F.3d 900, 906 (5th Cir. 2011) (per curiam) ("In determining the preclusive effect of an earlier state court judgment, federal courts apply the preclusion law of the state that rendered the judgment.").

Louisiana's res judicata statute states that "a valid and final judgment is conclusive between the same parties, except on appeal or other direct review" if "the judgment is in favor of the defendant, all causes of action existing at the time of final judgment arising out of the transaction or occurrence that is the subject matter of the litigation are extinguished and the judgment bars a subsequent action on those causes of action." LA. REV. STAT. § 13:4231(2). As the Louisiana Supreme Court has explained:

A reading of La. R.S. 13:4231 reveals that a second action is precluded when all of the following are satisfied: (1) the judgment is valid; (2) the judgment is final; (3) the parties are the same; (4) the cause or causes of action asserted in the second suit existed at the time of final judgment in the first litigation; and (5) the cause or causes of action asserted in the second suit arose out of the transaction or occurrence that was the subject matter of the first litigation.

Burguieres v. Pollingue , 843 So. 2d 1049, 1053 (La. 2003).

2.

First, plaintiffs argue that the district court erred in considering res judicata in St. Tammany's motion to dismiss. The district court explained that it considered St. Tammany's res judicata defense in its motion to dismiss because the "res judicata defense is apparent from the face of [p]laintiffs’ complaints and the documents attached to them," which specifically "reference the State Court Litigation in their original and amended complaints."

Res judicata is an affirmative defense principally raised in a party's responsive pleading. See FED. R. CIV. P. 8(c)(1) ("In responding to a...