Martinez v. Town of Clarkstown

Background

Emma Martinez sued the Town of Clarkstown, alleging procedural and substantive due process violations, a claim under the Takings Clause, and a claim under New York Civil Practice Law and Rules Article 78. The dispute arose from Clarkstown’s local laws regulating rental properties and short-term rentals. Martinez alleged that she had used her property for short-term rentals, received violations, applied for a permit, and was denied after Clarkstown enacted a law prohibiting rentals for fewer than 29 days in residential districts.

The Town moved to dismiss the amended complaint under Rule 12(b)(6), which tests whether a complaint states a legally sufficient claim. The court had dismissed Martinez’s earlier complaint without prejudice, allowing her to amend it.

Due Process Claims

The court dismissed the procedural and substantive due process claims because Martinez did not plausibly allege that she had a protected property interest in the short-term rental use. Under the court’s analysis, a prior nonconforming use can receive constitutional protection only if the use was lawful before the restrictive regulation took effect. Clarkstown’s 2016 local law required owners who rented their properties to register them. Martinez did not allege that she had registered the property, so the court concluded that she had not adequately alleged a prior lawful use or a protected property interest.

Takings Clause Claim

The court also dismissed the Takings Clause claim. First, Martinez did not plausibly allege a protected property interest. The court further held that the amended complaint did not adequately plead a non-categorical regulatory taking under the three-factor framework commonly associated with Penn Central: the regulation’s economic impact, interference with distinct investment-backed expectations, and the character of the government action.

The amended complaint did not allege rental numbers, rental charges, revenue, profits, or the extent to which longer-term rentals remained possible. It also did not allege that Martinez purchased or invested in the property in reliance on the ability to conduct short-term rentals. The court found that Clarkstown’s laws were enacted to serve public health, safety, and welfare, rather than to create a physical invasion of the property. The court did not consider allegations raised only in Martinez’s opposition brief as additions to the complaint and stated that the claim would fail even if those allegations were considered.

Article 78 Claim

Martinez’s fourth claim challenged the denial of her short-term rental application as arbitrary and capricious. The parties treated that claim as an Article 78 claim under New York law. After dismissing all federal claims, the court declined to exercise supplemental jurisdiction over the Article 78 claim. Supplemental jurisdiction is a federal court’s discretionary authority to hear related state-law claims after federal claims are present in the case.

Disposition

The court granted the Town’s motion to dismiss. Because Martinez had already amended her pleadings twice and had previously been notified of deficiencies, the court did not allow another amendment. The court dismissed Martinez’s claims with prejudice and directed the Clerk to terminate the motion and close the case. Judge Karas signed the order on September 25, 2025.