PALO ALTO (CBS SF) — Attorneys for two landlords trying to retire and close their mobile home park in Palo Alto have filed an appeal of a federal judge’s decision to dismiss a lawsuit challenging the city’s demands for relocation costs to the roughly 400 residents of the park.

Toufic and Eva Jisser, the owners of the Buena Vista Mobile Home Park, have been seeking for years to close the park and sell the land, possibly to a developer.

But the Palo Alto City Council found in 2014 that to do so, they would need to purchase the 104 mobile homes on the roughly 4.5-acre property from the residents and pay them relocation fees, including moving costs, first and last months’ rent and a security deposit. The Jissers estimate the bill at $8 million.

They sued the city in federal court seeking to block the order for payment. But U.S. District Judge Edward Davila dismissed the case on Friday, finding that the Jissers had not exhausted the state-level remedies available to them.

The Jissers filed an appeal of Davila’s decision with the 9th U.S. Circuit Court of Appeals on Monday.

“The crux of the decision is that the Jissers should have litigated all the way through California state courts before bringing their federal constitutional claims to federal court,” the Jisser’s attorney, Larry Salzman of the Pacific Legal Foundation, said in a statement Monday.

“With due respect to the court, it has misapplied a rule that applies only to cases seeking money damages against the government for a taking of private property,” Salzman said.

A solution that would keep the mobile home park open might also be on the horizon. The governments of Palo Alto and Santa Clara County have each set aside $14.5 million to purchase the property and the county Housing Authority has pledged to fund the remainder of the purchase price, depending on the appraisal.

But for that plan to move forward, the land still needs to be appraised, the governments and the current owners would need to agree on the price, and the Housing Authority would need to find a company to operate the park.