United States District Court, N.D. Indiana, Hammond Division
OPINION AND ORDER
T. MOODY UNITED STATES DISTRICT JUDGE
matter is before the court on the cross motions for summary
judgment filed by plaintiffs Christopher Regan and Northwest
Indiana Creative Investors Association, Inc.
(“NICIA”) and defendant City of Hammond, Indiana.
For the reasons identified below, plaintiffs' motion (DE
# 39) will be denied and defendant's motion (DE # 46)
will be granted.
Christopher Regan owns and leases real property in the City
of Hammond. (DE # 1 at 1.) Regan lives in Cook County,
Illinois. (Id.) Plaintiff NICIA is a non-profit
corporation acting as a trade association for real estate
investors who lease real property in Hammond. (Id.
at 2.) In their complaint, plaintiffs allege that sections of
Hammond's municipal code are unconstitutional because the
Code requires Hammond property owners who do not reside in
their property to obtain licenses, or hire licensed
contractors, to complete home repairs, but the Code exempts
homeowners who live in their Hammond homes from this
Hammond municipal code requires persons engaged in “the
business of a building contractor” in Hammond to be
licensed. Hammond Municipal Code § 150.017. However, the
Code specifically exempts resident homeowners from the
(B) Nothing contained in this subchapter shall prohibit the
resident homeowner of a private residence from doing building
contracting in his or her own private home and surrounding
property, providing he or she resides there, is able to
establish proof of residency, and is in compliance with all
requirement tests and regulations provided by law and this
code. Falsification or misidentification of residency is a
violation of this section and is subject to penalty as set
forth in § 150.999. A resident homeowner excluded under
this section acts as his or her own contractor and assumes
all responsibility for work done. All work must be done in a
workmanship manner and there must be compliance with all
codes and laws. If the owner of the property chooses to hire
a contractor, such contractor must be licensed in the city.
Municipal Code § 150.017. The Code definition of
“Building Contractor” for purposes of Section
150.017, includes “[a]ny person or persons who own a
building that they lease or rent;” but excludes
“[i]ndividuals who remodel the single family residence
in which they reside; upon review and inspection(s) by the
Building Commissioner.” Hammond Municipal Code §
allege that these sections of the Code violate the dormant
Commerce Clause by imposing an “improper, unreasonable
burden on interstate commerce by charging higher fees to
non-city owners of Hammond property than to Hammond-domiciled
owners of property.” (DE # 40 at 1.) Plaintiffs also
claim that the Code provisions run afoul of the Equal
Protection Clause of the Fourteenth Amendment because the
provisions are not related to any legitimate government
on the other hand, contends that the ordinance provisions
have no effect on interstate commerce because the provisions
treat all similarly situated persons the same, regardless of
their location. (DE # 46 at 1.) Defendant claims that the
City's regulation of for-profit building contractors and
landlords, but not resident homeowners repairing their
single-family homes, is rationally related to legitimate
governmental interests. (Id. at 1-2.) Thus, the City
argues, the ordinances survive review under both the dormant
Commerce Clause and the Equal Protection Clause.
parties have moved for summary judgment. This matter is fully
briefed and is now ripe for resolution.
Rule of Civil Procedure 56 requires the entry of summary
judgment, after adequate time for discovery, against a party
“who fails to make a showing sufficient to establish
the existence of an element essential to that party's
case, and on which that party will bear the burden of proof
at trial.” Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986). In responding to a motion for summary
judgment, the non-moving party must identify specific facts
establishing that there is a genuine issue of fact for trial.
Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 252 (1986); Palmer v. Marion County, 327 F.3d
588, 595 (7th Cir. 2003). In doing so, the non-moving party
cannot rest on the pleadings alone, but must present fresh
proof in support of its position. Anderson, 477 U.S.
at 248; Donovan v. City of Milwaukee, 17 F.3d 944,
947 (7th Cir. 1994). A dispute about a material fact is
genuine only “if the evidence is such that a reasonable
jury could return a verdict for the nonmoving party.”
Anderson, 477 U.S. at 248. If no reasonable jury
could find for the non-moving party, then there is no
“genuine” dispute. Scott v. Harris, 550
U.S. 372, 380 (2007).
court's role in deciding a summary judgment motion is not
to evaluate the truth of the matter, but instead to determine
whether there is a genuine issue of triable fact.
Anderson, 477 U.S. at 249-50; Doe v. R.R.
Donnelley & Sons Co., 42 F.3d 439, 443 (7th Cir.
1994). In viewing the facts presented on a motion for summary
judgment, a court must construe all facts in a light most
favorable to the non-moving party and draw all legitimate
inferences and resolve all doubts in favor of that party.
NLFC, Inc. v. Devcom Mid-Am., Inc., 45 F.3d 231, 234
(7th Cir. 1995).
Dormant Commerce Clause
Commerce Clause grants Congress the power to ‘regulate
Commerce . . . among the several States,' but the Supreme
Court has long held that a ‘dormant' or
‘negative' component of the Clause implicitly
limits the states from ‘erecting barriers to the free
flow of interstate commerce' even where Congress
hasn't acted.” Park Pet Shop, Inc. v.
City of Chicago, 872 F.3d 495, 501 (7th Cir. 2017)
(internal citations omitted). Modern Commerce Clause
precedents “rest upon two primary principles that mark
the boundaries of a State's authority to regulate
interstate commerce. First, state regulations may not
discriminate against interstate commerce; and second, States
may not impose undue burdens on interstate commerce.”
S. Dakota v. Wayfair, Inc., 138 S.Ct. 2080, 2090-91
or local law may fall into one of three categories, for
purposes of a dormant Commerce Clause analysis: (1) disparate
treatment; (2) disparate impact; and (3) “laws
‘that do not give local firms any competitive advantage
over those located elsewhere.'” Park Pet
Shop, 872 F.3d at 502 (quoting Nat'l Paint &
Coatings Ass'n v. City of Chicago, 45 F.3d 1124,
1131 (7th Cir. 1995)). In the first category are laws that
explicitly discriminate against interstate commerce. These
laws are treated as “presumptively unconstitutional,
” Id. at 501, and are subject to strict
scrutiny review. Legato Vapors, LLC v. Cook, 847
F.3d 825, 830 (7th Cir. 2017).
second category are laws that are neutral on its face, but
have a discriminatory effect in practice. If the law bears so
heavily on interstate commerce that it acts as an
“embargo on interstate commerce without hindering
intrastate sales, ” the law is treated as if it were
facially discriminatory. Park Pet Shop, 872 F.3d at
502. If, however, the law has only a “mild disparate
effect and potential neutral justifications, ” the law
is analyzed under Pike v. Bruce Church, Inc., 397
U.S. 137 (1970), which “established a balancing test
that requires the reviewing court to weigh the burden on
interstate commerce against the nature and strength of the
state or local interest at stake.” Id. If the
law “regulates even-handedly to further a legitimate
local public interest, and the effect on interstate commerce
is merely incidental, the law will be upheld unless the
burden on commerce is “clearly excessive in relation to
the putative local benefits.” Id.
the third category consists of laws that may effect commerce
but do not burden it, and do not give local entities any
competitive advantage over entities located elsewhere.
Id. Laws in this category receive rational-basis
review. Id. As the Seventh Circuit stated:
“‘No disparate treatment, no disparate impact, no
problem under the dormant commerce clause.'”
Id. (quoting Nat'l Paint, 45 F.3d at
The Hammond Ordinances Do Not Receive ...