govinfo:USCOURTS-mdd-1_25-cv-01241-0

1 
 
IN THE UNITED STATES DISTRICT COURT 
FOR THE DISTRICT OF MARYLAND 
 
 * 
CARROLL PLAZA, LLC, * 
 * 
Plaintiff, * 
 * Civ. No. MJM-25-1241 
v. * 
 * 
MAYOR AND COMMON COUNCIL    * 
OF WESTMINSTER, * 
 * 
Defendant. * 
 *     
*   *   *   *   *   *   *   *   *   * 
   
MEMORANDUM OPINION 
 
Carroll Plaza, LLC (“Plaintiff” or the “Plaza”) filed this civil action against the Mayor and 
Common Council of Westminster (“Defendant” or the “City”), alleging constitutional due process 
and takings violations and a state tort claim. See ECF 1. The City filed a motion  to dismiss the 
Complaint or, alternatively, for summary judgment,  ECF 13 , the Plaza filed a response in  
opposition, ECF 18, and the City filed a reply, ECF 22. The Plaza filed a motion for leave to 
file surreply and to submit newly discovered evidence, ECF 23, which the City opposed, ECF 26, 
and the Plaza replied, ECF 27. No hearing is necessary to resolve the p ending motions. See Loc. 
R. 105.6 (D. Md. 2025). For the reasons stated herein, both motions are granted, and the Complaint 
is dismissed without prejudice.  
I. FACTUAL BACKGROUND  
Carroll Plaza, LLC is the owner of commercial retail property commonly known as the 
Carroll Plaza Shopping Center , located in  Carroll County, Maryland. ECF 1 (“Compl.”) ¶ 1 . 
Although the Plaza is adjacent to, and not within, the City of Westminster’s territorial boundaries, 
the Plaza, since its inception nearly sixty years ago, has been served by a municipal public water 
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and sewerage utility operated by the City. Id. ¶¶ 7–8. The City also provides water services to 
properties that neighbor the Plaza. Id. ¶ 8. 
On or about January 31, 2023, a tenant operating a beauty salon in the Plaza vacated its 
rented space, Unit R11. Id. ¶ 11. Until that tenant vacated, the City regularly provided public water 
and sewer services to Unit R11 under the Plaza’s existing connections for water supply and sewage 
services. Id. ¶ 12.  
On or about April 5, 2024, the Plaza executed a lease with International Salon LLC 
(“International”), also a beauty salon operator, to become the new tenant of Unit R11. Id. ¶ 13. On 
or about May 10, 2024, International’s general contractor for its remodel of Unit R11 asked Plaza 
representatives to sign certain documents for a building permit to be filed with the Carroll County 
Bureau of Permits and Inspections, including a Water and Sewer Allocation Application requested 
by the City. Id. ¶ 14. 
To assist International, a Plaza representative contacted the City on or about May 30, 2024, 
to obtain a copy of the City’s allocation application and to schedule an in- person meeting with 
City staff on June 13, 2024. Id.  ¶ 15. At the June 13 meeting, City staff informed the Plaza “for 
the first time of the City’s purported water restrictions for the [Plaza] and its contention that no 
allocation applications had been received for any of the [Plaza] ’s tenants.” Id. ¶ 16. The Plaza’s 
representative asked the City to provide documentation showing that it previously informed the 
Plaza about its water allocation restriction. Id. ¶ 17. No documentation was provided. Id. 
Also at the June 13 meeting, Mark Depo, Director of the City’s Department of Community, 
Planning, and Development, advised Plaza representatives that the City would “ not release the 
permit for International’s buildout of Unit R11 until the Water and Sewer Allocation Application 
was submitted.” Id. ¶ 18. The City requested a floor plan of the Plaza,  a list of all tenants , and 
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square footages for all of the units, and asked that the Plaza’s tenants send or resend allocation 
applications for any tenant that moved into the Plaza after 2019. Id. ¶ 19. 
On or about June 28, 2024, the Plaza  submitted via email a Water and Sewer Allocation 
Application for Unit R11 and asked the City to advise what steps were needed to finalize the 
approval of International’s building permit application. Id. ¶ 20. This email went unanswered. Id.  
The Plaza requested another meeting with the City , which occurred on August 20, 2024 . 
Id. ¶ 21. At the August 20 meeting, Mr. Depo advised Plaza representatives that the City could not 
release the permit because he would not authorize continued public water and sewer service to 
Unit R11 for International, stating that “International was projected to use more water in its 
operation than the prior tenant.” Id. ¶ 22. He did not provide data regarding calculations or methods 
of calculation for the City’s projection. Id. Mr. Depo further advised that , because the Plaza was 
not within the City’s territorial boundaries, the entire Plaza needed to be annexed into the City to 
receive continued public water service to Unit R11. Id. ¶ 23. 
Since the meeting on August 20,  2024, the Plaza has  multiple times requested an 
explanation of the City’s method of calculating International’s projected water usage and the City’s 
capacity to supply that usage. Id. ¶ 24. The Plaza has received “incomplete responses.” Id. ¶ 25. 
The Plaza alleges that the City is purporting to act in accordance with a “Water and Sewer 
Allocations Policy,” which states that “property owners of property located outside the City limits 
but inside the water service area that are eligible for annexation under State law who desire to 
connect to the City’s public water system or require additional allocation must be annexed into the 
City to be eligible to apply for water allocation.” Id. ¶ 30. The Plaza does not wish to be annexed 
into the City, and it contends that its request for continued water service to Unit R11 is not a new 
request for service. Id. ¶ 31. According to the Plaza,  the City is using its  “need for public water 
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authorization as a means of coercing an existing user of the City’s public water service, at a 
location within the City’s existing water and sewer service area, to annex its commercial property 
against its will into the City for purposes of obtaining addit ional property tax revenue from [the 
Plaza].” Id. ¶ 27. The Plaza believes that being annexed into the City would amount to $70,000.00 
per year in additional real estate taxes alone. Id. ¶ 28. 
Due to the City’s refusal to issue a permit, International was unable to complete its remodel 
of Unit R11 and has informed the Plaza that it wishes to terminate its lease. Id. ¶ 33. The Plaza has 
other vacant spaces that it is working to fill with tenants . Id. ¶ 35. The Plaza complains that the 
ongoing water usage controversy will have a chilling effect on prospective tenants interested in 
occupying the vacant spaces. Id. 
II. STANDARD OF REVIEW 
A motion to dismiss under Federal Rules of Civil Procedure Rule 12(b)(6) tests the 
sufficiency of a civil complaint. “To survive a Rule 12(b)(6) motion, a complaint must satisfy the 
pleading standard articulated in [Rule] 8(a)(2), which requires a ‘short and plain statement of the 
claim showing that the pleader is entitled to relief.’” View Point Med. Sys., LLC v. Athena Health, 
Inc., 9 F. Supp. 3d 588, 596 (D. Md. 2014) (citation omitted). A plaintiff must plead enough factual 
allegations “to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 
U.S. 544, 570 (2007). “A claim has facial plausibility when the plaintiffs pleads factual content 
that allows the court to draw the reasonable inference that the defendant is liable for the misconduct 
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 
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Ordinarily, a court “is not to consider matters outside the pleadings or resolve factual 
disputes when ruling on a motion to dismiss.” 1 Bosiger v. U.S. Airways, Inc., 510 F.3d 442, 450 
(4th Cir. 2007). When a movant files a motion to dismiss seeking summary judgment as alternative 
relief and presents matters outside the pleadings , Rule 12(d) permits the court to  consider those 
matters and treat the motion “as one for summary judgment under Rule 56.” Fed. R. Civ. P. 12(d). 
Generally, converting a motion to dismiss to a  summary judgment motion is not 
appropriate “where the parties have not had an opportunity for reasonable discovery.” E.I. du Pont 
de Nemours v. Kolon Indus., Inc. , 637 F3d 435, 448–49 (4th Cir. 2011). At the same time, the 
party opposing summary judgment “cannot complain that summary judgment was granted without 
discovery unless that party had made an attempt to oppose the motion on the grounds that more 
time was needed for discovery.” Harrods Ltd. v. Sixty Internet Domain Names, 302 F.3d 214, 244 
(4th Cir. 2002) (quoting Evans v. Technologies Applications & Service Co., 80 F.3d 954, 961 (4th 
Cir. 1996)). To assert a need for discovery to oppose a summary judgment motion, a non-movant 
is generally required to file an “affidavit or declaration,” pursuant to Rule 56(d), stating that “ it 
cannot present facts essential to justify its opposition[]” to the motion the merits . Fed. R. Civ. P. 
56(d); see also Shaw v. Foreman, 59 F.4th 121, 128 (4th Cir. 2023). Even without such an affidavit, 
however, a district court may not grant summary judgment “when it otherwise has ‘fair notice of . 
. . potential dispute[s] as to the sufficiency of the  summary judgment record.’” Id. (citation 
omitted).  
 
1 When ruling on a Rule 12(b)(6) motion, a court may “consider documents that are explicitly 
incorporated into the complaint by reference” or “document[s] submitted by the movant” that are “integral 
to the complaint[,]” if “there is no dispute about the document’s authenticity.” Goines v. Valley Cmty. Servs. 
Bd., 822 F.3d 159, 165 –66 (4th Cir. 2016) (citations omitted); accord Zak v. Chelsea Therapeutics Int’l, 
Ltd., 780 F.3d 597, 606–07 (4th Cir. 2015). 
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Here, the City styled its motion to dismiss, in the alternative, as one for summary judgment, 
ECF 13, placing the Plaza on notice that the motion may be decided under Rule 56, see Laughlin 
v. Metro Washington Airports Auth., 149 F.3d 253, 261 (4th Cir. 1998). In response, the Plaza filed 
a Rule 56(d) affidavit asserting a need for discovery on a number of factual issues. See ECF 18-4 
(Declaration of William S. Zahler). The Plaza states that it “disputes several of the City’s factual 
assertions but lacks the facts necessary to oppose summary judgment due to the City’s purposeful 
nondisclosure of documents and failure to be forthcoming regarding its determinations.” ECF 18 
at 23. The City disagrees that discovery is necessary, largely citing the 16 exhibits it has provided, 
half of which contain communications between the parties. See ECF 22 at 1–7. Upon consideration 
of the parties’ submissions, the Court is persuaded that the Plaza has articulated its need for an 
opportunity to conduct discovery and finds that it would be improper to treat the City’s motion as 
one for summary judgment at this stage of the case. Accordingly, the Court declines to consider 
any matters outside the Complaint and will decide the City’s motion under a Rule 12(b)(6) 
standard. 
III. ANALYSIS 
A. Constitutional Claims (Counts I through IV) 
Counts I, II, and III of the Complaint assert claims for monetary, injunctive, and declaratory 
relief under 42 U.S.C. § 1983 and 28 U.S.C. § 2201 for alleged violations of the Due Process 
Clause and the Takings Clause of the Fifth Amendment and the Fourteenth Amendment to the 
U.S. Constitution, and Count IV seeks inverse condemnation based on the alleged Takings Clause 
violation. The Court will address, first, Plaintiff’s due process claims and then turn to its takings 
claims. For the reasons explained below, each of Plaintiff’s constitutional claims is subject to 
dismissal. 
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1. Due Process 
Neither 42 U.S.C. § 1983  nor 28 U.S.C. § 2201 is a source of substantive rights; these 
statutes are only remedial, each providing a method for vindicating substantive rights conferred by 
other federal laws. See Brunson v. Stein, 116 F.4th 301, 308 (4th Cir. 2024),  cert. denied, 145 S. 
Ct. 1169, 221 L. Ed. 2d 251 (2025); CGM, LLC v. BellSouth Telecommunications, Inc., 664 F.3d 
46, 55–56 (4th Cir. 2011 ). “To state a claim under § 1983, a plaintiff must allege (1) that a right 
secured by the Constitution or laws of the United States was violated, and (2) that the alleged 
violation was committed by a ‘person acting under the color of state law.’” See Gaines v. Baltimore 
Police Dep’t, 657 F. Supp. 3d 708, 748 (D. Md. 2023) (citations omitted). Under 28 U.S.C. § 2201, 
“upon the filing of an appropriate pleading” articulating an “actual controversy,” a  federal court 
may “declare the rights and other legal relations” of a party in a civil action and determine whether 
further relief could be sought. 28 U.S.C. § 2201(a).  
The Plaza alleges that the City violated substantive r ights to procedural and substantive 
due process conferred by the Due Process Clause of the Fourteenth Amendment. To succeed on a 
due process claim, whether procedural or substantive, “ a [plaintiff] must first show that it had a 
constitutional property interest and that the state deprived it of that interest.” Pulte Home Corp. v. 
Montgomery Cnty., Maryland, 909 F.3d 685, 691–92 (4th Cir. 2018) (quoting Quinn v. Bd. of Cty. 
Comm’rs, 862 F.3d 433, 443 (4th Cir. 2017)). The plaintiff bears the burden to show a protectable 
property interest. See Herman v. Lackey, 309 F. App’ x 778, 783 (4th Cir. 2009)  (unpublished) 
(citing Bd. of Regents v. Roth, 408 U.S. 564, 579 (1972)). 
A plaintiff has  a constitutionally cognizable property interest only if it has a “legitimate 
claim of entitlement,” rather than a mere “abstract need or desire” or “unilateral expectation.” 
Town of Castle Rock v. Gonzalez, 545 U.S. 748, 756 (2005) (internal quotation marks and citation 
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omitted). “Entitlements subject to due process protections are not created by the Fourteenth 
Amendment, but arise from and are defined by independent sources, including state law. ” Pulte 
Home Corp ., 909 F.3d at 692.  The Fourth Circuit has recognized that “ a legitimate claim of 
entitlement to a permit or approval turns on whether, under state and municipal law, the local 
agency lacks all  discretion to deny issuance of the permit or to withhold its approval. Any 
significant discretion conferred upon the local agency defeats the claim of a property interest. ” 
Gardner v. City of Baltimore Mayor & City Council, 969 F.2d 63, 68 (4th Cir. 1992); see also id. 
at 69 (explaining that “this standard appropriately balances the need for local autonomy in a matter 
of paramount local concern with recognition of constitutional protection at the very outer margins 
of municipal behavior,” and recognizing that the Fourteenth Amendment’s Due Process Clause 
“does not function as a general overseer of arbitrariness in state and local land -use decisions”), 
cited with approval in  Md. Reclamation Assocs., Inc. v. Harford Cnty. , 677 A.2d 567, 579 (Md. 
1996). 
Plaintiff identifies what it contends are two property interests at stake in support of its due 
process claims: (1) continued receipt of water services; and (2) business and livelihood. The Court 
will address these claims in turn. 
a. Property Interest in Continued Receipt of Water Services 
The City argues that the Plaza’s due process claims fail because the Plaza lacks a 
cognizable property interest. See ECF 22 at 9. The Plaza responds  that once the City extended 
water service beyond its territorial boundaries to the Plaza, it assumed a duty to continue providing 
that service, and the Plaza acquired a property interest in the City’s provision of water service, 
which the City may not terminate for coercive annexation purposes. ECF 18 at 12. But, according 
to the City, the Plaza has no inherent constitutional right to access the City’s water, and it lacks a 
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“legitimate entitlement” to an approval of its Water and Sewer Allocation Application on behalf 
of International because the City retains significant discretion under its Water and Sewer 
Allocation Policy. See id. at 9–10.  
The Court is unpersuaded by the Plaza’s argument that it has a constitutionally cognizable 
interest in the continued receipt of water service from the City.  Courts have recognized that 
“Maryland law does not create any constitutional right to water or sewer service.” Pulte Home 
Corp., 909 F.3d at 692; accord Neifert v. Dept. of Env., 910 A.2d 1100, 1122 (Md. 2006) (holding 
that property owners’ “right to receive sewer service is not a right created or established by either 
the United States or Maryland Cons titution”); Quinn v. Bd. of Cnty. Commissioners for Queen 
Anne’s Cnty., Maryland, 862 F.3d 433, 439 (4th Cir. 2017) (“Quinn’s Takings Clause claim based 
on his lack of sewer service fails because he never had a property interest in obtaining that 
service.”). In claiming a property interest in water service, the Plaza overstates Maryland law and 
ignores Fourth Circuit precedent. 
First, the Plaza cites Carter v. Suburban Water Co. , 101 A. 771, 772 (Md. 1917), for the 
proposition that because water is a “prime necessity of life,” a municipality may not arbitrarily 
shut off service when a bill is subject to a “just dispute.” In Carter, a landlord who owned 71 rental 
houses—each dependent on a single water utility with no alternative source —disputed a $291 bill, 
claiming he was entitled to offset losses caused by the company’s prior inadequate service. Id. at 
771. Although he offered to pay the amount properly owed, the company refused to negotiate and 
threatened to terminate service unless the full bill was paid. Id. Carter obtained an injunction, 
which the trial court later dissolved on the grounds that he had an adequate remedy at law 
(damages). Id. The Supreme Court of Maryland (then- named the Court of Appeals ) reversed, 
holding that while a water company may shut off service for nonpayment of valid charges, it may 
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not use that power to coerce payment of a bill disputed in good faith. Id. at 772. Because water is 
a “prime necessity,” terminating service would cause immediate and serious harm, justifying 
injunctive relief. Id.  
Carter does not support the Plaza’s position. Carter, unlike this case, involved whether 
equitable relief was available to a landlord of residential homes entangled in a good faith billing 
dispute with his water utility provider. Here, the dispute concerns the conditions of commercial 
water access imposed by a municipal government on a non-municipal property owner . Carter 
simply does not speak to the issues presented here. 
Next, the Plaza cites Mayor & Council of Rockville v. Goldberg, 264 A.2d 113 (Md. 1970), 
to argue it is “axiomatic” under Maryland law that a municipal utility must furnish water “without 
discrimination and at reasonable rates” when the requested service is within the reasonable reach 
of its system. In Goldberg, the owner of 5.9 acres of unincorporated land blocked Rockville’s 
attempt to annex his property and then obtained a writ of mandamus compelling the City to extend 
sewer and water service to the property outside the City limits. Id.  at 113. The Court of Appeals 
reversed. While reaffirming that a public utility has a duty to serve those within its service area, 
Maryland’s high court clarified that “a city cannot be compelled to supply water to anyone outside 
its limits,” even if it provides limited extraterritorial service by special contract, unless it has placed 
itself in the position of serving that broader area as a public utility. Id. at 117 (citing Cumberland 
v. Powles, 258 A.2d 410 (Md. 1969)). Because Goldberg’s property—though near existing lines —
was not located in an area the City of Rockville was already serving, he could not compel the City 
to extend service. Id.  at 117–18; see also Spring v. Bradley , 733 A.2d 1038, 1043 (Md. 1999)  
(applying Goldberg and holding that although the Town of Oxford provided water and sewer 
service to some properties outside its limits through “special” extensions, it had not held itself out 
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as a public utility for the surrounding area and therefore could not be compelled to extend service 
to the plaintiff’s nearby property). 
Goldberg also fails to sup port the Plaza’s claim to a cognizable property interest . While 
Goldberg did concern a public utility ’s relationship with non- residents, the question there was 
when a municipality could be compelled to serve non- residents, which largely turns on how the 
municipality “has treated other properties outside its borders [.]” See Spring, 733 A.2d at 1040.  
Here, there is no dispute that the City provided the Plaza services in the past and that it is willing 
to do so in the future. The ques tion here, therefore, is not about access  to public utility services, 
but whether the Plaza has a property interest in the continued conditions under which the City 
provides that access. Goldberg does not answer that question.  And, as noted supra , courts have 
routinely recognized that “Maryland law does not create any constitutional right to water or sewer 
service.” Pulte Home Corp., 909 F.3d at 692; accord Neifert, 910 A.2d at 1122; Quinn, 862 F.3d 
at 439.  
The Plaza claims that Maryland law is  “no different” than the relevant Tennessee law at 
issue in Memphis Light, Gas & Water Division v. Craft, 436 U.S. 1, 17 (1978), where the Supreme 
Court held that a public utility customer had a property interest in continued service, and the Due 
Process Clause required  notice and “ some administrative procedure  … to afford reasonable 
assurance against erroneous or arbitrary withholding of essential services .” Not so. In Memphis 
Light, the Court determined that residential property owners had a cognizable property interest in 
continued water service because Tennessee law provided that the public utility could terminate 
service only “for cause,” which gave rise to a “‘ legitimate claim of entitlement’  within the 
protection of the Due Process Clause.” Id. at 11–12; cf. Southside Tr. v. Town of Fuquay-Varina, 
69 Fed. Appx. 136, 138 (4th Cir. 2003)  (holding that because, under state law, the municipality 
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was permitted to terminate sewer service to non -residents at will, its breach of its contract with 
plaintiff was not protected by the Due Process Clause). Here, the Plaza does not plead any facts or 
cite any law to establish that it had a legitimate entitlement or that the City lacked discretion to set 
conditions upon its provision of water service. Cf. Maryland Reclamation Associates, 677 A.2d at 
579 (“Clearly, a local government does not lack ‘all discretion’ with regard to the enactment of 
new land -use o rdinances.” (citing Gardner , 969 F.2d at 68)).  Accordingly, Memphis Light  is 
distinguishable. 
In sum, the authorities cited by the Plaza do not demonstrate that it was vested with a 
property interest in, or legitimate entitlemen t to, the continued receipt of water service from the 
City under the same conditions it enjoyed in the past . Instead, the Plaza’s arguments amount to 
claiming a “abstract need or desire” or “unilateral expectation” that it would continue to receive 
water service from the City under past conditions.  Castle Rock, 545 U.S. at 756. Thus, this 
expectation does not give rise to a constitutionally cognizable property interest.2 
b. Business and Livelihood  
Next, the Plaza claims that, apart from its interest in the continued receipt of water services, 
it has  a “separate and distinct constitutionally protected property interest in the business and 
livelihood it generates from the [Plaza] which is dependent on the City’s continued provision of 
water services.” ECF 18 at 12. This argument also fails.  
 
2 The Plaza questions “whether the City’s Policy is truly motivated by an alleged water shortage, 
or rather, by a desire by the City to compel extraterritorial users of its water utility to annex into the City so 
as to create new property tax revenue streams for the City.” See ECF 18 at 17. It is not clear what the Plaza 
believes is the import of its observation. W ithout taking a position on what the City’s “true” motivation 
was, raising revenue is a legitimate legislative purpose. See U.S. v. Carlton, 512 U.S. 26, 40 (1994) (citing 
U.S. Const., Art. I, § 8, cl. 1) (Scalia, J., concurring).  
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The Plaza relies on Johnson v. City of Saginaw, Michigan, 980 F.3d 497 (6th Cir. 2020). 
There, after a gang -related gunfight occurred outside plaintiff Rita Johnson’s restaurant while it 
was being rented for a birthday party, the City of Saginaw suspended water service to the building 
to prevent further events. Id. at 502. Johnson sued under 42 U.S.C. § 1983, alleging violations of 
her procedural and substantive due process rights. Id.  at 502–05. The Sixth Circuit affirmed the 
district court’s conclusion that the City violated Johnson’s procedural due process rights by failing 
to provide adequate pre -deprivation process and violated her substantive due process rights 
through arbitrary state action. Id. at 508–11. 
In addressing Johnson’s property interest, the court stated that “[t]here can be no dispute 
that Johnson was deprived of a property interest,” explaining that “[t]he Supreme Court has held 
repeatedly that the property interest in a person’s means of livelihood is one of the most significant 
that an individual can possess.” Id. at 510 (quoting Ramsey v. Bd. of Educ. of Whitley Cnty. , 844 
F.2d 1268, 1273 (6th Cir. 1988)  (citing Cleveland Board of Education v. Loudermill , 470 U.S. 
532, 543 (1985) )). The court also observed that consumers who rely on utility services become 
dependent on those services for a “prime necessity of business, comfort, health, and even life.” Id. 
(quoting Palmer v. Columbia Gas of Ohio, Inc., 479 F.2d 153, 163–64 (6th Cir. 1973)). It further 
stated that an expectation of utility services may rise to the level of a “legitimate claim of 
entitlement” protected by the Due Process Clause. Id. at 512 (quoting Mansfield Apartment 
Owners Ass’n v. City of Mansfield, 988 F.2d 1469, 1474 (6th Cir. 1993)). 
The Plaza cites no controlling authority recognizing a property interest in a business’s 
“livelihood” based on continued municipal utility service.  The Sixth Circuit’s decision is not 
binding on this Court . And, with respect, this C ourt does not find the reasoning in Johnson 
persuasive. The statement in Ramsey —on which Johnson relies—recognizing a property interest 
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in an individual’s “means of livelihood” cites Cleveland Board of Education v. Loudermill , 470 
U.S. 532 (1985). But Loudermill  concerned a public employee who was terminated without an 
opportunity to respond to allegations that he had falsified his job application. Id.  at 535. The 
Supreme Court held that the employee had a protected property interest because Ohio law entitled 
covered civil service employees to retain their positions “during good behavior” and allowed 
dismissal only for specified causes. Id. at 539. In other words, the property interest arose from state 
law, which “plainly create[d]” an entitlement to continued employment. Id. Plaintiff here does not 
identify any state law that similarly create s for it  an entitlement against any interruption in a 
commercial entity’s “business and livelihood.” ECF 18 at 12.  
Although the Loudermill Court later acknowledged the “severity of depriving a person of 
the means of livelihood,” id. at 543, that observation was made during step one of the three-factor 
Mathews v. Eldridge balancing analysis, which considers the “private interest” at stake only after 
a protected liberty or property interest has been established . See Mathews v. Eldridge , 424 U.S. 
319, 335 (1976) (identifying three factors the “bear[] upon the constitutional adequacy of [given] 
procedures[,]” including, first, “the private interest that will be affected by the  official action”); 
Elhady v. Kable, 993 F.3d 208, 228 (4th Cir. 2021) (stating that the court “need not address 
plaintiffs’ claims as to the adequacy of existing processes[]” when plaintiffs fail to demonstrate 
infringement of constitutional interests); Accident,  Inj. & Rehab., PC v. Azar, 943 F.3d 195, 203 
(4th Cir. 2019) (recognizing that “[t]o prevail on a procedural due process claim,” a plaintiff must 
show deprivation of “a cognizable liberty or property interest;” and “that the procedures employed 
were constitutionally inadequate[;]’” and applying the three- factor Mathews inquiry “[t]o assess 
the constitutional adequacy” of given procedures) ; Bradley v. Colonial Mental Health & 
Retardation Servs. Bd., 856 F.2d 703, 707, 709 (4th Cir. 1988) (finding a public employee had a 
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legitimate claim of entitlement to continued employment based on the employer’s personnel 
manual and then applying the Mathews  balancing test to determine whether due process was 
satisfied). Loudermill does not establish that a commercial entity’s general interest in its “business 
and livelihood,” standing alone, constitutes a property interest protected under the Due Process 
Clause. 
Ultimately, the Plaza does not cite any binding authority to support the notion that it had a 
protected property interest in, or a legitimate claim of entitlement to , continued water services 
provided by a municipality based on commercial interests or business necessity. Cf. Bartoszewski 
v. Town of Hannibal, No. 5:09-CV-1453, 2012 WL 3822014, at *3 n.7 (N.D.N.Y. Sept. 4, 2012) 
(“[T]he Court finds that Plaintiffs have not identified any legitimate property interest in their 
commercial access to municipal water for procedural due process purposes.”); Johnson, 980 F.3d 
at 518 (“Even as access to utilities constitutes an essential resource, Johnson alleges a commercial 
interest in the water, not a residential interest.”) (Sutton, J., concurring).
3 
In sum, Counts I  through III of the  Plaza’s Complaint depend on the existence of a 
sufficiently pled constitutional violation. For the reasons discussed above, the Plaza cannot state a 
claim that the City violated its procedural and substantive due process rights because it cannot 
show first show that it had a constitutionally cognizable property interest  at risk of deprivation. 
Therefore, Counts I through III must be dismissed. 
  
 
3 It is also notable that the defendants in Johnson “conceded that Johnson had a ‘constitutionally 
protected property interest’ in ‘water service to [her] business.” See Johnson, 980 F.3d at 512 n.8; see also 
id. at 517 (“The parties agree that Johnson has a protected interest in the water.”) (Sutton, J., concurring). 
The corresponding issue in the instant case is contested. 
 
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2. Takings 
In addition to seeking damages and injunctive relief for alleged Fourteenth Amendment 
due process violations, Count I seeks the same form of relief for the City’s alleged violation of the 
Takings Clause of the Fifth Amendment, and, in Count IV, the Plaza seeks inverse condemnation 
for the alleged Takings Claus violation. A property own may bring “ an ‘inverse condemnation’ 
action for just compensation[]” when “a government takes property without condemnation 
proceedings or just compensation[.]” D.A. Realestate Inv., LLC v. City of Norfolk, 126 F.4th 309, 
316 (4th Cir. 2025)  (emphasis removed). The Plaza’s Fifth Amendment claim s in Counts I and 
IV—that the City deprived it of private property without just compensation—fail for the same 
reason as its due process claims: the Plaza does not plead a constitutionally cognizable property 
interest.
4 
“The Takings Clause of the Fifth Amendment prohibits the taking of private property 
without just compensation.” Putle Home Corp., 909 F.3d at 695 (citing Lingle v. Chevron U.S.A., 
Inc., 544 U.S. 528, 536 (2005)). Like the Due Process Clause, the Takings Clause protects property 
interests—it does not create it. See Washlefske v. Winston, 234 F.3d 179, 183 (4th Cir. 2000) (citing 
Phillips v. Washington Leg. Found. , 524 U.S. 156, 164 (1998)) . Accordingly, the analysis 
“necessarily begins” with determining whether the government ’s action interfered with property 
rights. Sunrise Corp. of Myrtle Beach v. City of Myrtle Beach, 420 F.3d 322, 330 (4th Cir. 2005). 
Property rights are “determined by reference to ‘existing rules or understandings that stem from 
an independent source such as state law.’” Quinn, 862 F.3d at 439 (citing Phillips v. Wash. Legal 
 
4 “Article III, Section 40 of the Maryland Constitution contains a provision that parallels the Fifth 
Amendment Takings Clause … and is interpreted in pari materia with the federal provision.” McLamb v. 
City of Mt. Rainier, Civ. No. DKC 23-3365, 2024 WL 4108570, at *10 (D. Md. Sept. 6, 2024) (citing Litz 
v. Md. Dep ’t of Env ’t, 131 A.3d 923 , 930 (D. Md. 2016) ). Plaintiff does not argue here that these two 
constitutional provisions should be interpreted differently. See ECF 18 at 20 n.2. Accordingly, the above 
analysis applies equally to both. 
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Found., 524 U.S. 156, 164  (1998) (quoting Bd. of Regents of State Colls. v. Roth , 408 U.S. 564, 
577 (1972))). “The property owner must show more than a mere hope or expectation; ‘h e must, 
instead, have a legitimate claim of entitlement.’” Id. (quoting Roth, 408 U.S. at 577 (cleaned up)). 
If no property rights are interfered with, there is no taking.  See Quinn, 862 F.3d at  439; Sunrise 
Corp. of Myrtle Beach, 420 F.3d at 330. The Plaza does not raise any new argument with respect 
to its property interest in the takings context that it didn’t already make in support of its due process 
claims, which have all been rejected, above. Instead, the Plaza argues that “[d] ue to the water 
restrictions imposed by the Policy, Carroll Plaza will be restricted in its ability to offer its space 
for lease to potential retail tenants; and in fact, it has already lost one tenant, International, due to 
the City’s Policy.” ECF 18 at 19. That may be so . But the Plaza has not shown the City’s action 
interfered with its property right s, so its Takings Clause claims  fail. See supra. Therefore, the 
Plaza’s Fifth Amendment takings claims in Counts I and IV must be dismissed.  
B. Tortious Interference (Count V) 
In Count V of the Complaint, the Plaza asserts a claim for tortious interference with 
economic relations under Maryland law. The Plaza argues that the City, acting in a “ proprietary” 
capacity, is “intentionally and willfully enforcing its unconstitutional water allocation (and 
annexation) Policy against Carroll Plaza” and thereby committing tortious interference with the 
Plaza’s economic relations. ECF 18 at 20 –22; see also Compl. ¶¶ 55–62 (Count V). The City 
responds that the Plaza fails to state a tortious interference claim and, in any event, that the City is 
entitled to governmental immunity. See  ECF 13-1 at 29–31. The Court agrees that the tortious 
interference claim is barred by governmental immunity. 
“Maryland law is well settled that a county (or municipality) generally enjoys immunity 
against common law tort liability arising out of acts that are governmental, as opposed to acts that 
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are private or proprietary.” Clark v. Prince George’s Cnty., 65 A.3d 785, 790 (Md. App. Ct. 2013) 
(citing DiPino v. Davis, 729 A.2d 354 (Md. 1999)). Although there is no bright-line rule, whether 
an entity acts in a governmental or proprietary capacity typically turns on whether the activity is 
intended to “promote the welfare of the whole public” and is devoid of any “priva te interest.” 
Truant v. Persuhn, Civ. No. RDB- 23-00579, 2023 WL 8600552, at *11 (D. Md. Dec. 12, 2023) 
(quoting Austin v. City of Baltimore, 286 Md. 51, 53, 65, 405 A.2d 255 (1979)). Whether the act 
at issue is “sanctioned by legislative authority” is also relevant. E. Eyring & Sons Co. v. City of 
Baltimore, 252 A.2d 824, 825 (Md. 1969). 
Here, there is no dispute that the Mayor and Common Council of Westminster is a 
municipality generally immune from tort liability  under Maryland law . See Local Government, 
M
ARYLAND STATE ARCHIVES, https://perma.cc/QV5E-C44L (last visited March 30, 2026) (listing 
Westminster as a municipality of Carroll County ). Nor is there any dispute that the Plaza’s tort 
claim challenges the City’s legislatively enacted Water and Sewer Allocation Policy. Although the 
Plaza questions the City’s rationale for the policy—including its stated historical water scarcity —
it argues th at the City’s actions are “undeniably proprietary” because the dispute concerns 
“extraterritorial water supply,” which Maryland courts have sometimes described as “proprietary.” 
ECF 18 at 21–22 (citing Bair v. Mayor & City Council of Westminster, 221 A.2d 643 (Md. 1966)). 
The Plaza misunderstands the import of Bair. There, landowners whose property was just 
outside Westminster sought to compel the city to provide water service. Bair , 221 A.2d at 644. 
The case did not involve a tort claim and therefore did not address governmental immunity. 
Although the court used the term “proprietary” while discussing a municipality’s water service 
obligations, id. at 645, the rule that emerged from Bair , as later clarified in Goldberg, is that “a 
city cannot be compelled to supply water to anyone outside its limits,” even if it provides limited 
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extraterritorial service by special contract, unless it has placed itself in the position of serving the 
broader area as a public utility. See Goldberg, 264 A.2d at 117. The Court of Appeals later noted 
in Spring that Bair also supports the corollary rule that “ when a municipality has  undertaken to 
supply water” to a defined area outside its limits, it must do so impartially and may not “pick and 
choose” among similarly situated consumers. Spring,  733 A.2d at  1042 ( citation omitted) 
(emphasis in original). 
In short, Bair addressed when a municipality may be compelled to provide water service; 
it did not involve a tort claim based on a legislative enactment  or governmental immunity. The 
Plaza’s reliance on Bair, therefore, is misplaced. The Plaza fails to establish that the City’s conduct 
here was proprietary  for governmental tort immunity purposes . Rather, the conduct challenged 
here—the adoption and enforcement of a legislatively enacted water and sewer allocation policy—
is a governmental function undertaken for a public purpose.  Because the Plaza’s tortious 
interference claim arises from that governmental action, the City is entitled to governmental 
immunity. Accordingly, Count V must be dismissed. 
IV. CONCLUSION 
For the foregoing reasons, Defendant’s motion to dismiss (ECF 13) is granted, Plaintiff’s 
motion for leave to file a surreply (ECF 23) is granted, and the Complaint is dismissed without 
prejudice. The Clerk shall close the case.  
A separate Order will issue. 
 
  3/31/26      _________________________________ 
Date      Matthew J. Maddox  
      United States District Judge 
 
 
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