OPV Partners v. City of Lansing: Non-Payment of Administrative Appeal Fees Bars Federal Due-Process and Takings Claims

Introduction

OPV Partners, LLC owned and operated the 618-unit Autumn Ridge Apartments in Lansing, Michigan, from 2014 to 2024. Lansing’s Housing Code requires a renewable two-year “certificate of compliance” before landlords may lease residential units. After repeated code violations, the City tagged many units and ultimately refused to issue new certificates until violations were cured.

When OPV attempted to appeal the violation notices, City officials insisted that OPV first file standard appeal forms and pay a $200 fee per appeal. OPV never paid the fees, the appeals were never docketed, and the City continued enforcement action. OPV then sued the City and two officials in federal court under 42 U.S.C. § 1983, alleging violations of procedural and substantive due process and an uncompensated taking, plus a state-law breach-of-settlement claim. The district court dismissed all federal claims and declined supplemental jurisdiction over the state claim.

The Sixth Circuit has now affirmed—on the distinct ground that OPV forfeited its constitutional claims by refusing to utilize the City’s available, facially adequate administrative review process. The opinion, although “Not Recommended for Publication,” breaks new analytical ground by explicitly equating non-payment of modest, standard administrative fees with a failure to exhaust remedies for purposes of both due-process and takings analyses. The decision will likely influence how landlords and other regulated property owners navigate local code-enforcement challenges within the Sixth Circuit and beyond.

Summary of the Judgment

The panel (Moore, Griffin, and Kethledge, J.J.; opinion by Kethledge, J.) affirmed dismissal of all federal claims.
Assuming—but not deciding—that OPV held a protected property interest in leasing its apartments, the court concluded that Lansing provided adequate procedures (an appeal to the Building Board of Appeals) and that OPV’s voluntary decision not to pay the required appeal fees defeated both its procedural and substantive due-process claims.
Because OPV failed to pursue the same administrative avenue, its Fifth-Amendment takings claim was likewise “forfeited.”
Qualified immunity for individual defendants was not addressed; once no constitutional violation was shown, the court declared further analysis unnecessary.
The panel affirmed the district court’s decision to decline supplemental jurisdiction over OPV’s state contract claim.

Analysis

1. Precedents Cited

The opinion relies heavily on established Supreme Court and Sixth Circuit doctrine linking exhaustion (or forfeiture) of administrative remedies to constitutional claims:

Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306 (1950) – foundational case on notice and opportunity to be heard.
Parratt v. Taylor, 451 U.S. 527 (1981) – holding that when the state provides a meaningful post-deprivation remedy, no procedural due-process violation occurs if the plaintiff fails to use it.
Hahn v. Star Bank, 190 F.3d 708 (6th Cir. 1999) – elements of a procedural due-process claim.
Pearson v. City of Grand Blanc, 961 F.2d 1211 (6th Cir. 1992) – “arbitrary and capricious” standard for substantive due process in land-use disputes.
McIntosh v. City of Madisonville, 126 F.4th 1141 (6th Cir. 2025) – “shocks the conscience” threshold reaffirmed.
Howard v. Macomb County, 133 F.4th 566 (6th Cir. 2025) – forfeiture of takings claims when administrative remedies ignored.
Pearson v. Callahan, 555 U.S. 223 (2009) – sequential steps in qualified-immunity analysis.
Campanella v. Commercial Exchange Bank, 137 F.3d 885 (6th Cir. 1998) – discretion to decline supplemental jurisdiction.

Collectively, these authorities supplied the doctrinal scaffolding for the panel’s conclusion that OPV’s inaction, not the City’s conduct, caused any alleged deprivation.

2. Legal Reasoning

Adequate State Procedure
• Under Parratt, if a meaningful remedy is available, a procedural due-process claim fails unless the plaintiff uses—and is denied—that remedy.
• The City’s Building Board of Appeals provided a facially neutral, timely hearing mechanism.
• E-mails attached to OPV’s own complaint demonstrated multiple invitations to set hearing dates, conditionally on payment of a standard $200 filing fee—an ordinance-mandated prerequisite.
• Because OPV never paid, the Board never acquired jurisdiction; thus, Lansing did not “refuse” to hear the appeals.
Forfeiture of Takings Claim
• The panel recast “exhaustion” as “forfeiture”—emphasizing that plaintiffs who bypass available state procedures simply lose the claim.
• This framing sidesteps debates after Knick v. Township of Scott, 588 U.S. 180 (2019), about whether administrative exhaustion is still required for takings. The Sixth Circuit views local appeal mechanisms as part of defining the property interest and measuring finality; failure to complete them prevents ripeness and thus amounts to forfeiture.
Substantive Due Process
• OPV alleged City actions (pink/red tags, urging tenants to withhold rent) were “arbitrary.”
• The panel reiterated the “shocks the conscience” standard and found OPV’s pleadings devoid of facts suggesting irrational, malicious, or conscience-shocking conduct—especially given OPV’s non-compliance with code enforcement steps.
Qualified Immunity & Supplemental Jurisdiction
• With no constitutional violation pleaded, individual defendants’ qualified immunity became moot.
• Under § 1367(c)(3), the district court had discretion—and acted within it—to dismiss the state-law breach-of-contract claim.

3. Impact on Future Litigation

Clear Incentive to Pay Small Fees: Plaintiffs challenging municipal actions must meet all procedural prerequisites, including nominal fees, or risk losing federal claims outright.
Expanded “Forfeiture” Language: By styling the failure to pursue local appeals as “forfeiture” instead of “lack of ripeness,” the panel provides defendants a potent Rule 12(b)(6) weapon unconnected to complex jurisdictional doctrines.
Convergence of Due Process and Takings Standards: The decision treats the same administrative remedy as curing both procedural-due-process and takings concerns, streamlining municipal defense strategies.
Persuasive, Though Unpublished: Even as a non-precedential opinion, district courts within the Sixth Circuit frequently cite such dispositions when facts align. Municipal counsel will likely rely on it when landlords skip filing fees or other minor procedural steps.
Practical Guidance for Landlords: Property owners must document that they have actually attempted to invoke local review and been denied, not merely that they disagreed with cost or timing requirements.

Complex Concepts Simplified

Procedural Due Process: The constitutional guarantee that the government cannot deprive you of life, liberty, or property without first giving you notice and an opportunity to be heard before a neutral decision-maker.
Substantive Due Process: Protects individuals from government actions so egregious and arbitrary that they “shock the conscience,” even when some process is offered.
Takings Clause: Part of the Fifth Amendment (applied to states via the Fourteenth) that requires “just compensation” when the government takes private property for public use. Denying a property right—like the right to rent apartments—can be a “regulatory taking.”
Section 1983: A federal statute enabling individuals to sue state or local officials for constitutional violations.
Qualified Immunity: Shields government officials from personal liability unless they violated “clearly established” constitutional rights.
Exhaustion/Forfeiture: The principle that a plaintiff must first use available state remedies; failure to do so usually bars a federal claim.
Pink vs. Red Tags: In Lansing, a pink tag bans new rentals until compliance; a red tag condemns a unit as unsafe.
“Not Recommended for Publication”: Indicates the opinion is non-precedential under Sixth-Circuit rules but may still carry persuasive weight.

Conclusion

OPV Partners v. City of Lansing underscores a straightforward yet often overlooked reality: process matters. By refusing to pay routine appeal fees, OPV deprived itself of the very hearing it claimed was denied, dooming its federal constitutional claims. The Sixth Circuit’s reasoning weaves together exhaustion doctrine, due-process jurisprudence, and takings law to hold that litigants who bypass readily available local remedies cannot seek refuge in federal court. While unpublished, the ruling furnishes municipal defendants with a concise roadmap for defeating similar suits and sends a potent message to property owners: before alleging constitutional deprivation, first comply with the administrative steps—however minor—they seek to challenge.