In the Zone: Court Rejects "Takings" Challenge to City's Rental Assistance Ordinance and more...

In the Zone: Court Rejects "Takings" Challenge to City's Rental Assistance Ordinance

The Seventh Circuit Court of Appeals rejected a "takings" challenge to a city ordinance that protects tenants in residential buildings when ownership is transferred through a foreclosure action. BBLI Edison, LLC v. City of Chicago.

In 2021, the City of Chicago adopted the "Keep Chicago Renting Ordinance." That ordinance requires anyone who obtains a rental property through a foreclosure action to negotiate new leases with existing tenants in good faith and if the tenant declines to renew a lease, pay the tenant $10,600 to assist with relocation expenses. When BBLI took control of a rental property through a sheriff's deed in 2024, BBLI followed the procedures under the ordinance for negotiating new leases, but at least five tenants declined new leases and requested the relocation assistance fee. BBLI filed a lawsuit against the city claiming that the ordinance violated its civil rights because requiring payment of the fee constituted an unconstitutional "takings" under the Fifth Amendment to the U.S. Constitution. The district court dismissed the case, and BBLI appealed to the Seventh Circuit Court of Appeals. The Seventh Circuit uphold the dismissal of the case.

First, the Court found that the city had authority to adopt the ordinance as a regulation of the landlord-tenant relationship.

Second, the Court rejected BBLI's argument that the relocation assistance fee requirement was a "physical" taking because it transfers wealth, finding this ordinance to be similar to rent control regulations which courts have found are not "physical" takings.

Third, the Court did not find a "regulatory" taking because, among other things, the city's ordinance did not interfere with BBLI's "investment-backed expectations" since the ordinance was already in effect when BBLI purchased the property.

Finally, the Court rejected BBLI's "unconstitutional conditions" argument because BBLI was not asking for permission to build or engage in some other lawful activity that the city was withholding or imposing conditions on the issuance. Instead, the ordinance was enacted to further the city's interest in keeping its residents housed.

In short, the Court upheld the dismissal of BBLI's "takings" challenge to the rental assistance ordinance.

PAC Finds Public Body in Violation of OMA Because Agenda Description Was Not Sufficient

In its 7th binding opinion for 2026, the Public Access Counselor for the Illinois Attorney General (PAC) found a public body in violation of the Open Meetings Act by taking final action at a board meeting without setting forth the general subject matter of the item on the meeting agenda. PAC Op. 26-007. The PAC did find the board provided an adequate public recital prior to voting on the matter, however.

A reporter filed a complaint with the PAC alleging that a public body voted on the creation of new employment positions without adequately describing the proposed action on its meeting agenda or providing a sufficient public recital prior to voting. The vote to create the new positions was taken under the agenda item "Approval of Supervisor's Report." The PAC watched the video recording of the meeting and noted that the Supervisor suggested adding five new employment positions during his Supervisor's report, and that a motion was made to approve the necessary hires, the motion seconded, and then a vote taken by the board to approve that motion.

The board defended its actions, stating that no formal action had been taken by the board since these hires were within the Supervisor's authority, and that the board's vote was not final action but "merely a formality." The PAC rejected that argument, stating that the board's vote "resolved the question of whether the Board approved of the creation of those positions," which constituted final action under the OMA. The PAC then determined that the agenda listing did not comply with Section 2.02(c) of the OMA, which requires that a meeting agenda set forth the general subject matter of any ordinance or resolution that will be the subject of final action at a meeting. (Note that the PAC opinion does not state that the action taken by the board even involved the approval of an ordinance or resolution, and instead only references a motion being made, seconded, and voted on at the meeting).

As for the reporter's claim that the board did not provide an adequate public recital prior to taking a vote, the PAC rejected that argument, finding that the Supervisor described each of the positions involved in the motion and detailed the justification for the proposed new hires. The PAC noted that a discussion of the financial impacts of the new hires was not required, and that the discussion prior to the actual vote complied with Section 2(e) of the OMA.

Appeals Court Rules in Favor of City in Challenge to Firefighter's Termination for Social Media Posts

A federal court of appeals upheld the termination of a city firefighter after he posted several racially charged and offensive posts on his personal Facebook account. Inendino v. Nance-Holt.

A firefighter worked for a city fire department for 16 years. Most of his work was at a station in a predominantly Black neighborhood of the city. As an EMT, he had frequent contact with the public and engaged directly with patients. He had a personal Facebook page which was publicly viewable. On his personal Facebook page, he identified himself as a city firefighter, and his profile picture depicted him on the back of a fire truck, wearing his firefighter gear. After the city received multiple complaints about content he posted on Facebook, the city conducted an investigation and prepared a report that found that a number of his Facebook posts were racist and offensive, targeted Black and Asian Americans, and showed a contempt for the residents of the community he served. The report recommended that the city terminate him. Shortly after, he was terminated for violating the city's personnel rules relating to social media and professional conduct. The firefighter filed a grievance under the city's collective bargaining agreement, but the arbitrator ruled against him, finding just cause for his termination.

The firefighter then sued the city, claiming it violated his civil rights in firing him, and challenging the city's policies as unconstitutional. The district court ruled in favor of the city, and he appealed to the Seventh Circuit Court of Appeals.

The Seventh Circuit upheld the city's termination, rejecting the firefighter's constitutional claims. The Court applied what is known as the "Pickering balancing test" which applies when a government employee challenges a negative employment action on First Amendment grounds.

First, the Seventh Circuit accepted for purposes of applying the Pickering balancing that some of his Facebook posts might address matters of public concern. However, the Court rejected the firefighter's argument that the First Amendment protected those posts, finding that (1) he identified himself as a city firefighter on his Facebook page, (2) his Facebook posts were racially offensive, (3) he targeted groups that his position required him to protect, and (4) that the city's interest in ensuring that its fire department succeed in performing its public safety mission outweighed any interest in his posting the offensive content on Facebook.

In sum, the Court upheld the city's termination of the firefighter for his Facebook posts and comments.

Public Comment Policy Overly Broad and Vague Under First Amendment

In Merriott v. City of Bossier City, the Fifth Circuit Court of Appeals held that a city's "decorum" policy for city meetings violated the First Amendment because it was overly broad as well as vague in prohibiting personal, impertinent, and slanderous remarks and "becoming boisterous" during public comment.

An online journalist attended city council meetings where the city clerk read from the city's rules of decorum for public comment. Those rules included restrictions on cell phone usage, imposed time limits on speakers, and required the audience to maintain decorum. At one of the meetings, the city clerk read the following statement:

Any person making personal, impertinent or slanderous remarks or who shall become boisterous while addressing the Council shall be forthwith, by the President Pro-tem, barred from further audience before the Council unless permission to continue by [sic] granted by a majority vote of the Council” (the “Policy”)....All remarks shall be addressed to the Council as a body and not to any member thereof. No questions shall be asked a [sic] Council person or the mayor except through the meeting chair. All other audience members are asked to please observe the meeting quietly. City Council appointed Sergeant at Arms have been instructed to maintain decorum and ask anyone in violation to step out of the meeting. Merriott again “criticiz[ed] the Council for failing to listen to the Mayor and the citizens.

The journalist spoke during public comment at several meetings and criticized the city on a decision relating to term limits. He was interrupted by councilmembers reminding him of the decorum rules. After one of the meetings, the journalist wrote a letter to the city, requesting the council respect his First Amendment rights and not interrupt him during public comment. At the next meeting, he was again interrupted during public comment and threatened with removal. He then sued, alleging violations of the state's open meetings laws and his First Amendment rights. The district court dismissed his case, and he appealed.

The Fifth Circuit Court of Appeals reversed part of the dismissal of his case, finding that the journalist had plausibly alleged in his complaint that the city's public comment policy was unconstitutional. First, the Court found that the policy's prohibition on "personal" remarks was too broad because its enforcement could capture protected free speech, such as criticism of individual councilmembers. Second, the Court found that the prohibition on "impertinent" remarks was also too broad because it allows the city council to decide which comments are permissible at its whim. Third, the Court struck down the policy's ban on "slanderous" remarks, finding that it was too broad because it placed a speaker in doubt about what he or she could say about public officials and public figures. Fourth, the Court found that the policy's ban on persons who "become boisterous" was too broad because it went beyond conduct and would also apply to speech, implicating the First Amendment. The Court also found the policy to be too vague because the terms "personal" and "impertinent" were undefined and, therefore, failed to provide speakers with a "reasonable opportunity to know what conduct is prohibited."

In sum, the Court found that the city's public comment policy was overly broad and too vague, and remanded the case back to the district court for further proceedings. The Court upheld the district court's findings in favor of the city on the journalist's open meetings act and content-based discrimination claims, however.

Although this case is out of the Fifth Circuit (which does not cover Illinois), it is consistent with Illinois Attorney General opinions and court rulings that question public comment policies that go beyond regulating conduct.

Court Sends Social Media Defamation Case Back to Trial Court to Award Compensatory Damages

Although this case does not involve local governments, it is an interesting case involving social media posts and a defamation lawsuit. Sullivan v. Schiman.

A patient posted on a local "updates and information" Facebook page about a doctor she had seen in the emergency room. Her post named the doctor and claimed that he had sexually assaulted her in giving a rectal examination. That Facebook post was then made a "featured post" by the Facebook page's administrator, which meant it was the first post on that Facebook page. When the doctor learned about the post, he filed a complaint against both the patient and the Facebook page's administrator alleging defamation "per se" among other claims. The case went to trial, and testimony by a nurse who was present during the exam contradicted the claims made by the patient in her Facebook post. At the end of the trial, the judge found in favor of the doctor on his defamation claim against both defendants, and awarded him $1.00 in nominal damages from both the poster and the page administrator.

The doctor appealed on two grounds. First, the doctor claimed the trial court erred in awarding only $1.00 in damages. Second, the doctor argued that the trial court should have imposed sanctions against the page administrator and his attorney for providing false answers in discovery.

The Appellate Court agreed with the doctor on both issues. First, the Appellate Court ruled that nominal damages were not reasonable in this case where several thousand people saw the Facebook post accusing him of a violent sexual assault, which, among other things, would support an award of compensatory damages rather than only nominal damages. Defamation "per se" occurs when a false statement is so inherently harmful that the damage to a person's reputation is obvious on its face, meaning the doctor did not need to prove actual monetary or special damages. The Appellate Court also found that the trial court abused its discretion in denying sanctions for the discovery violations. The Appellate Court sent the case back to the trial court to enter an appropriate award of damages and to reevaluate the sanctions request.

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