The Tenth Circuit Court of Appeals published its opinion in Rural Water District No. 4 v. City of Eudora on Monday, July 1, 2013.
This is the second appeal in a dispute involving Rural Water District No. 4 in Douglas County, Kansas and the City of Eudora, Kansas. The water district, Douglas-4, neighbors Eudora and contends Eudora is trying to poach Douglas-4’s customers. Douglas-4 is currently indebted on a USDA-guaranteed loan, so Eudora’s actions potentially violate a federal law that prohibits municipalities from poaching rural water districts’ customers while a USDA-guaranteed loan is in repayment. Douglas-4 therefore sued Eudora under 42 U.S.C. § 1983, claiming Eudora violated Douglas-4’s federal statutory right to be free from poaching. A trial resulted in a jury verdict for Douglas-4. The Tenth Circuit vacated the verdict on the first appeal and remanded for a new trial.
After the first appeal, the state of Kansas amended the statute the first appeal was decided upon. The amendment removed the prohibition on water districts obtaining USDA loan guarantees unless the guarantee was “necessary.” The district court on remand held that the amendment did not apply retroactively and certified the question of retroactivity to the Tenth Circuit. The Tenth Circuit agreed that the amendment did not apply retroactively.
The district court had denied summary judgment to both parties and did not certify that decision to the court. In the interests of judicial economy, the court found it had discretion under 28 U.S.C. § 1292(b) to address whether summary judgment was appropriate. The court affirmed the denial of summary judgment to Douglas-4 but reversed the denial to Eudora.