William J. Lurie v. State of California

The question raised by this appeal is whether the district court erred in dismissing plaintiffs’ complaint on the ground that it reiterated claims presented to the state courts. The district court held the claims barred by res judicata. We hold that plaintiffs effectively failed to reserve their federal claims, and fully and freely litigated them in the state courts. We affirm.

I

Plaintiffs, members of a limited partnership, leased a parcel of land located within a marina owned'by the County of Los Ange-les. On March 6, 1974, pursuant to its authority under the California Coastal Zone Conservation Act of 1972, Cal. Public Resources Code § 27000 (repealed by § 27650) (West 1977), the California Coastal Zone Conservation Commission rejected plaintiffs’ application for a permit to construct a hotel on the leased property. Plaintiffs responded by filing suit in state court on April 23, 1974. Their complaint sought an order permitting the planned construction and damages due to the delay, or alternatively, damages as compensation for the lost value of their leasehold and their development expenditures. On May 6, 1974, they filed an almost identical complaint in United States District…