In the
United States Court of Appeals
For the Seventh Circuit
No. 10-1106
R OCK E NERGY C OOPERATIVE,
Plaintiff-Appellant,
v.
V ILLAGE OF R OCKTON,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of Illinois, Western Division.
No. 09 C 50111—Frederick J. Kapala, Judge.
A RGUED M AY 25, 2010—D ECIDED A UGUST 10, 2010
Before F LAUM, R OVNER, and W OOD , Circuit Judges.
W OOD , Circuit Judge. The Village of Rockton, Illinois, and
the Rock Energy Cooperative are fighting over who
ultimately will own some assets used by the natural gas
and electric utilities in the area. Originally the assets
were the property of Alliant Energy, but Alliant wanted
to sell them. They wound up in Rock Energy’s hands,
but in the meantime the Village passed a referendum
authorizing it to acquire the assets. Although the Village
2 No. 10-1106
has taken no direct steps in that direction (at least as of
the time this case was argued in our court), Rock Energy
is seeking a declaration to the effect that the Village
does not have proper authority to purchase or condemn
the assets. We conclude that this litigation is premature
and thus affirm the district court’s judgment dismissing
the action.
I
Rock Energy is a consumer-owned utility that pro-
vides gas and electricity to its members on a cost-of-
service, nonprofit basis. In 2004, Alliant announced that
it would take bids for the sale of assets held by its sub-
sidiary, South Beloit Water, Gas and Electric Company.
(For simplicity, we will refer to them as the Alliant
assets.) The announcement caught the attention of both
Rock Energy and the Village. Rock Energy submitted a
bid for the Alliant assets, and the Board of Trustees of
Rockton passed an ordinance on January 18, 2005, autho-
rizing the Village to acquire the assets by purchase or
condemnation.
Unfortunately, according to Rock Energy (but vig-
orously disputed by the Village), there was a potential
technical problem with the passage of the ordinance. The
version of the ordinance published for the voters’ review
on March 17, 2005, in a local newspaper, stated that
the Village was to be authorized to spend up to
$35 million to acquire the Alliant assets. But there was
a different version of the ordinance floating around,
under which the Village would be authorized to spend
up to $48 million for the Alliant assets. The two versions
No. 10-1106 3
differed in other respects as well. The $35 million version
referred to and included maps depicting the general
location of the assets and had a lengthy, 28-page
appendix with more details. On March 24, the paper
printed a specimen ballot with the questions, but not the
dollar amount, from the $48 million version. The referen-
dum took place on April 5, 2005. The actual ballot asked
the voters to approve the expenditure of up to $48 million
for the assets, and they did so. It is Rock Energy’s posi-
tion that the discrepancy between the published version
and the version passed by the voters resulted in a viola-
tion of 65 ILCS 5/11-117-3.
At the time the voters approved the ordinance, Rock
Energy was still negotiating with Alliant for the pur-
chase of the assets. A few months later, on June 30, 2005,
the Village and Rock Energy entered into a Memorandum
of Understanding (the “MOU”), in which they expressed
their “mutual intent to explore the feasibility of Rock-
ton[’s] acquiring the local utility assets” from Rock
Energy. In the MOU, Rock Energy agreed to sell the
assets to the Village if certain conditions were satisfied,
including the completion by the Village of a feasibility
analysis addressing topics such as finance, safety, relia-
bility, and operations; the parties also needed to come to
an agreement on the price that the Village would pay.
The next day, Rock Energy entered into a contract with
Alliant to purchase the assets; for reasons that are not
explained, it took another year and a half for that transac-
tion to close. By February 2007, however, Rock Energy
owned the Alliant assets. After that, the Village told
Rock Energy on more than one occasion that it wanted
4 No. 10-1106
to acquire the assets, as contemplated by the MOU. For
example, Rock Energy alleges that the Village wrote to
it on March 29, 2009, stating that “[t]he Village Board made
the decision in 2005 that pursuing this purchase was in
the best interests of the Village, this was confirmed by
over 60% of the voters and has been consistently sup-
ported by the Village Board through multiple election
cycles.” The Village has also threatened to condemn
the assets, using its power of eminent domain.
The March 29 letter was apparently the last straw for
Rock Energy. On May 11, 2009, it filed a complaint in
the district court for the Northern District of Illinois
seeking a declaratory judgment stating that “the Village
of Rockton has not met the requirements of Illinois law
to acquire electric and gas utility assets from Rock
Energy Cooperative.” The complaint asserts that juris-
diction exists under 28 U.S.C. § 1332, because Rock
Energy is a citizen of Wisconsin (incorporated in
Wisconsin and headquartered there) and the Village is a
citizen of Illinois, as it is a non-home-rule municipality
of that state. The Village, in the meantime, filed a com-
plaint in the Circuit Court of Winnebago County, Illinois,
seeking declaratory relief and specific performance of
Rock Energy’s alleged commitment to sell under the MOU.
The district court dismissed Rock Energy’s suit on the
ground that it lacked standing to challenge the Village’s
compliance with Illinois law when it passed the ordi-
nance. To the extent that Rock Energy was attempting to
assert that the Village had failed to satisfy the precondi-
tions outlined in the MOU, the court held that venue
No. 10-1106 5
was improper under the forum selection clause in the
agreement, which said that “any litigation relating to
this MOU will take place exclusively in the Circuit
Court of Winnebago County Illinois.” Turning to the
litigation that the Village had initiated in that court, we
learned through a supplemental filing that on April 29,
2010, Circuit Judge J. Edward Prochaska dismissed the
Village’s action for specific performance with prejudice.
See Village of Rockton v. Rock Energy Cooperative, Case
No. 2009 MR 427 (Ill. Cir. Ct., 17th Jud. Cir.). The state
court held that the MOU was unenforceable as a matter
of law, because the indefinite price term contemplated
future negotiations. Without the essential price term
(or even a formula for arriving at price), the court
found that there was nothing definite enough to be
the subject of an order for specific performance.
II
Before this court on appeal, Rock Energy challenges
both bases of the district court’s ruling. It insists that it
has standing to seek a declaration that the Village lacks
authority to acquire the Alliant assets, arguing that it
faces an actual, imminent injury-in-fact that is concrete
and particularized; that its injury is caused by the
Village’s actions; and that its injury is redressable
through the court’s declaration. See, e.g., Lujan v. Defenders
of Wildlife, 504 U.S. 555, 559-62 (1992). Rock Energy also
urges us to disregard the choice-of-forum clause in the
MOU because, it says, its case is about the Village’s
“fundamental” lack of authority to go forward with the
6 No. 10-1106
acquisition and thus it is not constrained by the MOU.
The Village’s initial response is that diversity jurisdic-
tion is lacking, because Rock Energy has failed to dem-
onstrate that more than $75,000 is at stake. See 28 U.S.C.
§ 1332(a). The record shows, however, that the parties
are fighting over the transfer of approximately $10 mil-
lion in utility assets, and so we are satisfied that our
subject-matter jurisdiction is secure. That conclusion
is not undermined by the possibility, or likelihood, that
the Village will pay fair market value for whatever assets
are transferred. Rock Energy wants the assets, not their
equivalent in dollars, and its effort to keep those assets
out of the Village’s hands suffices to meet the amount-in-
controversy requirement. See America’s MoneyLine, Inc.
v. Coleman, 360 F.3d 782, 786 (7th Cir. 2004) (endorsing
the so-called “either viewpoint” rule).
The Village has also pursued some more promising
avenues in support of the district court’s judgment. There
are only two ways in which Rock Energy could be
forced into selling its assets to the Village: first, through
the Village’s exercise of its power of eminent domain, or
second, through the MOU, if that document were con-
strued to create a contractual obligation on Rock
Energy’s part to sell. We find that neither one of these
possibilities is sufficiently concrete to support Rock En-
ergy’s suit.
Article III of the U.S. Constitution limits the authority
of the federal courts to “cases or controversies.” From
that requirement flow two closely related concepts:
ripeness and standing. Smith v. Wis. Dep’t of Agric., Trade
No. 10-1106 7
and Consumer Prot., 23 F.3d 1134, 1141 (7th Cir. 1994). Both
of these doctrines bar a plaintiff from asserting an
injury that “depend[s] on so many future events that
a judicial opinion would be advice about remote con-
tingencies.” Meridian Sec. Ins. Co. v. Sadowski, 441 F.3d
536, 538 (7th Cir. 2006). Focusing particularly on suits
for declaratory relief, the Supreme Court has explained
that courts must look at “whether the facts alleged, under
all the circumstances, show that there is a substantial
controversy, between parties having adverse legal inter-
ests, of sufficient immediacy and reality to warrant the
issuance of a declaratory judgment.” MedImmune, Inc. v.
Genentech, Inc., 549 U.S. 118, 127 (2007). The application
of these principles is not always easy, as we observed in
Wisconsin Central, Ltd. v. Shannon, 539 F.3d 751, 759 (7th
Cir. 2008) (“[T]he distinction between a ‘controversy’ in
the Article III sense and an abstract question of law is
necessarily one of degree, and it would be difficult, if
it would be possible, to fashion a precise test for deter-
mining in every case whether there is such a controversy.”)
(internal quotation marks and citations omitted).
We begin with Rock Energy’s eminent-domain theory.
The company would like us to believe that its Alliant
assets are likely to be taken by the Village at any mo-
ment. As we held in Shannon, it continues, it is “no bar to
ripeness if the government has only threatened enforce-
ment, rather than actually brought a lawsuit.” 539 F.3d at
760. But this record is startlingly devoid of evidence that
the Village is waiting to pounce with an eminent-
domain action. The ordinance about which Rock Energy
complains was passed five years ago; Rock Energy has
8 No. 10-1106
had a contractual right to own the assets for the same
five years; and it has actually held them for more than
three years. That does not sound like imminence to us.
What Rock Energy does not like is living, as it might put
it, under the Sword of Damocles, knowing that its
property rights can be cut off by the Village’s eminent-
domain power at any moment.
This case does not look like some of the other Illinois
cases on which Rock Energy relies, where the unrealized
threat of eminent domain was well on the road to ful-
fillment. For example, in Davis v. Brown, 827 N.E.2d 508
(Ill. App. Ct. 2005), the state authorities had an elaborate
plan in place to take the plaintiffs’ property, and the
ordinance in question restricted their use of the property
during the lead-up to the taking. Id. at 511-13. In Philip
v. Daley, 790 N.E.2d 961 (Ill. App. Ct. 2003), the city
was in the midst of executing a detailed plan to take
the plaintiffs’ property. Id. at 963-64. As far as this
record shows, during the years since the ordinance was
passed, the Village has done nothing other than write
a letter or two indicating that condemnation was on the
table. The Village’s state-court action was based on the
MOU. We discuss the MOU below; here we note only
that it does not support the hypothesis of an imminent
threat of eminent domain.
Rock Energy also fares badly when we consider the
Supreme Court’s approach to pre-enforcement chal-
lenges to government action. The leading case is Abbott
Laboratories v. Gardner, 387 U.S. 136 (1967). The Court
there explained that the ripeness of a pre-enforcement
No. 10-1106 9
challenge hinges on “the fitness of the issues for judicial
decision and the hardship to the parties of withholding
court consideration.” Id. at 149; see also Metro. Mil-
waukee Ass’n of Commerce v. Milwaukee County, 325 F.3d 879,
881-84 (7th Cir. 2003). We can grant here that the
primary issue Rock Energy wants to raise is a legal one:
whether the procedures the Village used in passing the
2005 ordinance complied with Illinois law. (We offer
no opinion on the question—hotly debated before this
court—whether Rock Energy is a suitable party to raise
this point; here we are merely identifying it as a legal
issue.) But the second part of the Court’s inquiry is not
so easy for Rock Energy. It has not shown how a
decision on its declaratory judgment complaint would
resolve some present hardship. Nothing in this record
indicates that an eminent-domain action is “certain, only
delayed,” nor does the record show how the threat of
future enforcement is having a present concrete, adverse,
and irremediable effect on Rock Energy’s day-to-day
affairs. We note as well that the Anti-Injunction Act, 28
U.S.C. § 2283, would prohibit a federal court from en-
joining a state-court proceeding that has already com-
menced, and any other effort to use the federal courts
to interfere with an ongoing state-court condemnation
case would need to reckon with such cases as Younger
v. Harris, 401 U.S. 37 (1971).
If and when the Village ever initiates eminent-domain
proceedings in the state court, Rock Energy will be able
to assert the same defenses that it has put forward here.
If, for example, it wants to argue that the Village’s action
against it is not authorized by Illinois law, it can present
10 No. 10-1106
that contention to the court and see how it fares. Rock
Energy would also have the opportunity in any such
proceeding to argue that the Village’s estimate of fair
market value for the Alliant assets is too low, if that is
in fact what it thinks. We conclude that the chance of
future eminent-domain proceedings in this case is too
remote to support the claim that Rock Energy is trying
to litigate.
Turning to the MOU, we find that Rock Energy’s case
is equally flawed. We note to begin with that Rock
Energy has firmly disclaimed any intent to rely on
the MOU (presumably because it is trying to avoid the
choice-of-forum clause). If the MOU is really off the
table, then it can neither help nor harm Rock Energy. If
the memorandum continues to have some effect, the
only way that it might make Rock Energy worse off is if
it is a binding agreement that gives the Village a con-
tractual right to acquire the Alliant assets for some
agreed amount of money. But, as the state court pointed
out, there is no agreement on price in the MOU, nor is
there a formula by which the price could be computed.
And by now, we also know that the state court has
found, in litigation between the same parties, that the
agreement is unenforceable. The finding on that issue
is almost certainly entitled to preclusive effect under
Illinois law, see People v. Tenner, 794 N.E.2d 238, 247 (Ill.
2002) (setting out requirements for collateral estoppel
in Illinois), and thus in a federal court as well, see 28
U.S.C. § 1738. Finally, as the district court pointed out, to
the extent that the MOU has a role to play in this case,
it includes a clear choice-of-forum clause directing all
No. 10-1106 11
litigation to the state court. Under Illinois law, which the
parties selected in the MOU, the court will override the
parties’ contractual choice of forum only if that choice
would as a practical matter deprive the plaintiff of its
day in court. See Kawasaki Kisen Kaisha Ltd. v. Regal-Beloit
Corp., 130 S. Ct. 2433, 2448 (2010); see also Abbott Labs. v.
Takeda Pharm. Co., 476 F.3d 421, 423-24 (7th Cir. 2007).
No costs of that kind are imaginable here; the Circuit
Court of Winnebago County sits in Rockford, Illinois, at
400 W. State Street, 0.2 miles away by car from the
U.S. District Court for the Northern District of Illinois,
Western Division, at 211 S. Court Street in Rockford.
Furthermore, the fact that the parties may have sub-
stantive objections to the scope of the contract does
not undermine the forum-selection clause, which is
severable from such questions. See, e.g., Kochert v.
Adagen Med. Int’l, Inc., 491 F.3d 674 (7th Cir. 2007).
The parties have presented additional arguments, but
we have said enough to dispose of this appeal. The
district court correctly recognized that this case was not
an appropriate candidate for a declaratory judgment.
We therefore A FFIRM its judgment dismissing Rock
Energy’s suit.
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