Discretionary Towing Rotation Lists Do Not Create Due-Process “Property” Without a Binding Source of Entitlement

3.1 Precedents Cited

A. Pleading and review framework

• Ratfield v. U.S. Drug Testing Laboratories, Inc. (de novo review of dismissal on the pleadings) framed the standard of appellate review.
• Yash Venture Holdings, LLC v. Moca Financial, Inc. and Oakland Police & Fire Retirement System v. Mayer Brown, LLP supplied the familiar distinction between factual allegations (accepted as true) and legal conclusions (not accepted), which mattered because Tire Town’s “property interest” assertion was largely conclusory.
• The court’s reference to Fed. R. Civ. P. 10(c) explained why the “Minimum Standards” policy attached to the complaint could be considered at the motion-to-dismiss stage.

B. The constitutional baseline for “property” under procedural due process

• Booker-El v. Superintendent, Indiana State Prison was cited for the threshold requirement: a procedural due process claimant must first allege a protected property interest.
• Board of Regents of State Colleges v. Roth and Perry v. Sindermann provided the canonical formulation: property interests are not limited to tangible ownership but require a “legitimate claim of entitlement,” derived from “existing rules or understandings” independent of the Constitution. The court repeatedly returned to Roth’s distinction between entitlement and a “unilateral expectation.”

C. Unwritten understandings and reliance—recognized, but limited

• Forgue v. City of Chicago supported Tire Town’s general proposition that property interests need not be “codified in writing,” and can arise from “mutually explicit understandings” or “legitimate and reasonable reliance on a promise from the government.”
• Hannon v. Turnage (quoted via Forgue) and Vail v. Board of Education of Paris Union School District No. 95 reinforced that reliance on a governmental promise can, in some contexts, be the “source of property rights.”
• Perry v. Sindermann was used again as an analogy: an “unwritten ‘common law’” of tenure can create protected expectations—if, and only if, it is sufficiently mutual and limiting.
• Despite these authorities, the court found Tire Town’s reliance theory failed because the only “promise-like” source identified—the Minimum Standards policy—expressly preserved broad County discretion.

D. Contract as “property” and why the policy did not qualify

• Malhotra v. University of Illinois and Doe v. Purdue University
• The court distinguished those scenarios because the Minimum Standards policy expressly disavowed contractual status and lacked “bargained-for exchange.” The County did not pay Tire Town, and Tire Town did not perform services directly for the County (it charged vehicle owners), undermining any contractual-entitlement framing.

E. Discretion defeats entitlement

• Town of Castle Rock v. Gonzales (citing Kentucky Dep't of Corrections v. Thompson) supplied the controlling principle: when officials may grant or deny a benefit in their discretion, the benefit is not a protected entitlement.
• FKFJ, Inc. v. Village of Worth provided a closely analogous Seventh Circuit application: no protected property interest in renewal of a business license where renewal was discretionary.

F. The public-employment analogy and the “good cause” contrast

• Gilbert v. Homar and Grant v. Trustees of Indiana University embodied the traditional rule that employees who can be terminated only for “good cause” have a property interest in continued employment.
• The court rejected the analogy: a spot on a tow rotation list is not comparable to a public job, and the policy’s “at any time for any appropriate reason” is materially looser than “cause” limitations.
• Brown v. Michigan City (quoting Colburn v. Trustees of Indiana University) articulated the required degree of constraint: a property interest exists only when discretion is “clearly limited” so the interest can be denied only if “specific conditions are met.”

G. Towing-rotation-list cases and the need for an “independent source”

• O'Hare Truck Service, Inc. v. City of Northlake was the Seventh Circuit’s most directly relevant towing-list precedent. There, the court also rejected a procedural due process claim for lack of a property interest, while observing that some other courts have found such an interest when anchored in a statute or regulation.
• The opinion cited the “distinguishable” cases that did find a property interest because they had an identifiable legal basis: Pritchett v. Alford, Abercrombie v. City of Catoosa, and Gregg v. Lawson.
• It also cited additional towing-list decisions requiring a similar legal anchor: Blackburn v. City of Marshall and Morley's Auto Body, Inc. v. Hunter.
• These authorities supported a consistent theme: towing-rotation participation becomes “property” only when external law (or binding rules) meaningfully limits the government’s power to exclude.

H. “Force of law” and Wisconsin’s Meyers v. Schultz

• Tire Town attempted to leverage language in Meyers v. Schultz to argue that policies can have “force of law,” and thus create property interests.
• The court rejected the analogy as a category mistake: Meyers v. Schultz addressed whether a manufacturer’s assembly instructions could create a “ministerial” duty under Wisconsin tort-immunity doctrine—not whether a county policy creates enforceable entitlement for due process purposes.
• The court also relied on O'Hare Truck Service, Inc. v. City of Northlake’s caveat that internal regulations create property only “when they have the force of law,” and found Tire Town had not identified any authority adopting its proposed expansion.

3.2 Legal Reasoning

The court’s reasoning proceeds in three tight steps, each grounded in Roth’s entitlement framework:

1. Identify an “independent source” of entitlement. The court emphasized that due process “property” must come from outside the Constitution—typically state law, regulations, ordinances, contracts, or binding understandings. Tire Town identified no Wisconsin statute, regulation, or ordinance granting a right to be on the rotation list.
2. Reject contract as the source. Even though contract rights can be property, the Minimum Standards policy explicitly said it was not a contract and lacked hallmarks of a bargained-for exchange: no County payment and no services performed for the County as counterparty. Thus, Tire Town could not plausibly plead a contractual entitlement.
3. Discretion defeats “mutually explicit understanding.” Tire Town’s fallback was that policy circulation and participation created an implied, mutual understanding. The court treated this as an objective inquiry: both sides must reasonably understand that the plaintiff has a legitimate claim of entitlement. But the policy reserved unilateral removal authority (“at any time for any appropriate reason”). Under Town of Castle Rock v. Gonzales and Brown v. Michigan City, such open-ended discretion prevents any entitlement from arising.

Importantly, the opinion draws a line between (a) a government’s promulgation of standards and (b) a government’s surrender of discretion. Standards may guide administration, but unless they meaningfully constrain the government’s ability to deny or terminate the benefit, they do not create a constitutionally protected property interest.

The court also flagged—without deciding—that a different case might exist if removal were for a constitutionally suspect reason (race, religion, perhaps political affiliation). That observation underscores the doctrinal separation between “no property interest” (no procedural due process claim) and other constitutional theories (e.g., equal protection or First Amendment retaliation) that do not require property.

3.3 Impact

A. Effects on towing-rotation disputes in the Seventh Circuit

This decision strengthens (and modernizes) the Seventh Circuit’s skepticism—seen in O'Hare Truck Service, Inc. v. City of Northlake—toward treating rotation-list participation as due-process property absent a clear external entitlement. Plaintiffs challenging removal from tow lists will likely need to plead (and ultimately prove) one of the following:

• A specific Wisconsin statute/regulation/ordinance that guarantees inclusion or constrains removal;
• A true contract with the local government conferring enforceable continuation rights; or
• Binding rules that “clearly limit” discretion (e.g., removal only upon enumerated grounds and after specified procedures).

B. Drafting incentives for local governments

The court’s emphasis on discretion and contract disclaimers will likely influence how counties and municipalities draft towing-rotation policies: explicit non-contract language and broad removal clauses reduce exposure to procedural due process claims premised on property interests. Conversely, governments that want stable vendor participation but also want to avoid due-process entitlements may maintain performance standards while preserving clear discretionary exit authority.

C. Litigation pathway shifts

For businesses, Tire Town Auto LLC v. Wood County suggests that a procedural due process theory will often fail at the threshold unless there is a legally enforceable entitlement. Plaintiffs may instead explore: (i) state-law contract or promissory estoppel (where facts support a promise and reliance), (ii) state administrative-law remedies (if applicable), or (iii) non-property constitutional claims where discriminatory or retaliatory motives are plausibly alleged (subject to their own elements and defenses).

D. Doctrinal clarification: policies vs. entitlements

The opinion reinforces a broader administrative-law lesson: internal standards can regulate participants without conferring constitutional property. This can reduce the risk that every government “program” or “preferred vendor list” becomes constitutionalized merely because it has written criteria.