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November 16, 1973

900 G.C. AFFILIATES, INC., and Joseph Caspi, Plaintiffs,
The CITY OF NEW YORK et al., Defendants

Tenney, District Judge.

The opinion of the court was delivered by: TENNEY


TENNEY, District Judge.

 Defendants *fn1" have moved for judgment on the pleadings dismissing the complaint pursuant to Rule 12 of the Federal Rules of Civil Procedure. Because the Court has been supplied with affidavits and other materials outside of the pleadings, both sides have been informed that defendants' motion shall be treated as one for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. Plaintiffs have moved for an order staying revocation of their New York City Department of Consumer Affairs cabaret license number 551859. For the reasons discussed below, defendants' motion is granted and plaintiffs' motion is denied.


 The pleadings and affidavits filed by both sides indicate that there is no genuine issue as to any material fact. The facts, as disclosed by the papers, will therefore be summarized before the motions are disposed of on the merits.

 Plaintiff Joseph Caspi owns the Concourse Plaza Hotel, which is located in the Bronx. He owns 100% of the stock of plaintiff 900 G.C. Affiliates, Inc., a New York corporation which manages the Hotel. The Hotel is located in a part of New York City which is undergoing racial change from white to black. Within the Hotel is situated a discotheque named The Tunnel, which is frequented by blacks. Apparently, residents of the neighborhood have been complaining for some time that The Tunnel is a public nuisance because those who frequent it have harassed and annoyed residents and passersby on several occaions.

 In October 1972, the New York City Department of Consumer Affairs ("the Department") issued to plaintiffs a one-year cabaret license number 551859 permitting plaintiffs to conduct The Tunnel as a cabaret so long as plaintiffs complied with the laws of the State of New York, the rules and regulations of the Department, and the rules and regulations of all other New York State and New York City agencies. *fn2"

 On or about November 29, 1972, a resident of the community, Mrs. Natalie Cass, wrote to defendant Bess Myerson, who was at that time Commissioner of the Department, asking that The Tunnel's license be revoked and that it be permanently closed. Apparently, the Department took no further action until January 1973, when it sent inspectors to the premises of The Tunnel on three occasions. The inspectors noted what they thought to be violations of the City's Administrative Code. In accordance with Department procedures, the Department sent written notice to plaintiff 900 G.C. Affiliates, Inc. on January 31, 1973, indicating that a hearing would be held on February 7, 1973 regarding certain listed charges against the Tunnel in order to determine whether The Tunnel's license should be suspended or revoked.

 Nine of the listed charges are what plaintiffs have termed "technical violations": use of unlicensed rooms for discotheque purposes; failure to post at the licensed premises a sign informing the public that they may report complaints to the Department; and failure to keep a personnel roster containing a record of each employee, his address, occupation and dates of employment. The tenth charge, apparently based on Mrs. Cass' complaint, stated:

"[that] the licensee has operated and maintained and continues to operate and maintain the premises in a manner causing annoyance, abuse and harassment of residents of the neighborhood and of persons using the public walks at and near the premises, by causing large numbers of persons to congregate in, at and by the premises and immediately at the entrance thereto, knowing that and having reason to know that persons attracted to the premises and resorting thereto, would annoy, harass and abuse residents and sojourners in the area."

 Hearings were held before defendant Richard Haimowitz on February 7, 15, 28 and March 15, 1973. At the first hearing, Mr. Leon Liner, counsel for plaintiffs at the hearing, appeared and immediately requested an adjournment, stating that he had not had sufficient time to prepare for the hearings. Mr. Liner admitted, however, that his client had received proper notice. Defendant Haimowitz agreed to grant a continuance as to the first nine charges but refused to grant a continuance as to the tenth charge because it would greatly inconvenience many representatives of the community who had come to the hearing for the purpose of testifying on that charge. At that point, Mr. Liner left the hearing. Thereupon, defendant Haimowitz proceeded to hear the testimony of nine witnesses, including Mrs. Cass, a party to the Department's complaint, and defendants Abrams and Salman. All of the witnesses who gave testimony on the tenth charge were white.

 At the second date of the hearings, February 15, 1973, Mr. Liner appeared, asked for certain files, and indicated to defendant Haimowitz that he would need more time to prepare his case. The hearing examiner agreed to adjourn the proceedings, but indicated that the plaintiffs could have no more adjournments.

 At the third date of the hearings, February 28, 1973, Mr. Liner appeared and actively participated in the proceedings. This portion of the hearings was devoted to the first nine charges. The hearing was adjourned before any additional evidence on the tenth charge was taken.

 At the final hearing on March 15, 1973, a representative from Mr. Liner's firm presented himself to defendant Haimowitz, and handed him an affidavit which indicated that, because Mr. Liner had to attend a funeral, an additional adjournment would be necessary. Defendant Haimowitz, stating that he had earlier announced that there would be no more adjournments, refused to grant Mr. Liner's request. He noted that Mr. Liner was a member of a firm with a large number of lawyers so that someone else could have taken Mr. Liner's place at the hearings. At that point, Mr. Liner's representative left the hearing room. The hearing on the tenth charge proceeded. It should ...

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