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Tax Law

Federal Seventh Circuit Finds No “Plain, Speedy or Efficient Remedy”, Allows Taxpayers’ Suit to Proceed in Federal Court over County’s TIA Objections

After nearly a decade of stalled litigation in Illinois state court, the U.S. Court of Appeals for the Seventh Circuit permitted a group of taxpayers to proceed in federal court with their U.S. constitutional challenge to property tax assessments, over Tax Injunction Act and comity objections by Cook County. While the district court held that the TIA barred the federal suit, the Seventh Circuit reversed noting that this is the rare case where there is not a “plain, speedy and efficient remedy” in Illinois courts. And, for similar reasons, the Seventh Circuit rejected the county’s argument that the appeals court should decline jurisdiction on the principle of comity.

Here, the procedural statute at issue, (35 ILCS 200/23-15(b)(3)), solely permits a taxpayer to challenge the correctness of a property assessment, without regard to an assessor’s methods or intent. The taxpayers were able to show the appeals court that the statute limited who the taxpayers could name as a defendant, what evidence they could present, and what arguments they could raise. Therefore, the Seventh Circuit concluded that the governing procedural statute effectively prohibits a taxpayer from raising an Equal Protection Clause challenge in state court because it ignores the assessor’s methods and intent, which are needed to meet the “no rational basis” test to prevail on such a challenge.

A.F. Moore & Associates, Inc., et al v. Maria Pappas, et al., Illinois Court of Appeals Case No. 19-1971 (Jan. 29, 2020).