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HOTEL ST. GEORGE ASSOCS. v. BENJIA

April 20, 1993

HOTEL ST. GEORGE ASSOCIATES, A Partnership, Plaintiff,
v.
BENJIA MORGENSTERN, JOAN HARRIS, WILLIAM A. ROOS and JULIA H. STANTON, Defendants.



The opinion of the court was delivered by: CONSTANCE BAKER MOTLEY

 Defendants move for judgment on the pleadings pursuant to Rule 12(c) of the Federal Rules of Civil Procedure. Plaintiff moves for the voluntary dismissal of the entire action pursuant to Rule 41(a)(2). Defendants' move for sanctions pursuant to Rule 11 or the inherent power of the court. Defendants' motion for judgment on the pleadings, which this court treated as a motion for summary judgment, is granted. Plaintiff's motion for voluntary dismissal is denied. Defendants' motion for sanctions is denied.

 I. BACKGROUND

 This case arises out of a dispute between plaintiff, Hotel St. George Associates, and defendants Benjia Morgenstern, Joan Harris, William Roos, and Julia Stanton, individual members of the Brooklyn Heights Association, Inc. (the "BHA"), concerning the housing of homeless HIV positive individuals and AIDS victims at the Hotel St. George (the "Hotel").

 At one time, the Hotel St. George was the largest hotel in New York City. Located in downtown Brooklyn, the Hotel was once patronized by the famous and elite who kept society within its elegant trappings. Since its glory in the 1940s, the clientele of the Hotel St. George has changed. The Hotel now primarily houses the elderly, people who are HIV positive, and people with AIDS. The Hotel has 371 rooms, 300 of which it has offered to the Mayor's Office of Homelessness and SRO Housing (the "Mayor's Office") to contract for and house the homeless and in particular, AIDS homeless. Indeed, the Mayor's Office has recognized that the Hotel is conveniently located and that the charge per room to the City by the Hotel is less expensive than that of comparable hotels which are also providing accommodations for the homeless in other areas of the City. See Complaint, Letter of William Roos, March 8, 1991.

 The BHA is also a part of Brooklyn history. Founded in 1910, it is the oldest and largest community organization in New York City. The organization regularly presents some of the views of the Brooklyn Heights community to public officials. Led by a board of 30 governors, the BHA has worked with state and city officials and members of the community on such issues as land use, parks, safety, homelessness, sanitation, and traffic.

 Plaintiff has named individual members of the BHA as defendants in this suit. Benjia Morgenstern has been a member of the BHA board of governors since 1990. Joan Harris has served as a member of the BHA board of governors since 1985. William Roos, BHA president from mid-1990 to mid 1992, is currently on the BHA advisory board. Julia Stanton served on the BHA board of governors form 1983 to 1988, at which time she resigned her position to become a member of the BHA staff. She is currently the BHA's Executive Director, and as such is responsible for implementing BHA board policy, representing the BHA in discussions with city officials and managing the BHA office.

 In the summer of 1990, the New York City Human Resources Administration (the "HRA") began placing homeless HIV positive and AIDS patients at the Hotel on a temporary basis. At this time, the Mayor's Office set a cap of 65 patients for the Hotel. The HRA paid (and continues to pay) the Hotel approximately $ 840 a month for each AIDS patient housed at the Hotel, which also rents space to the elderly and others, but is largely vacant.

 In November 1990, representatives of the BHA met with Ruth Jacobsen, manager of the Hotel, then Councilperson Gereges and his staff, three members of the Brooklyn Heights community, and representatives of the HRA and the 84th precinct. At the meeting, the HRA discussed the services (including case managers) it was providing to its clients at the Hotel, and the policy of the Mayor's office of setting "caps" to maximize the welfare of HRA and to minimize impact on the community.

 The BHA contacted the Brooklyn AIDS Task Force in early 1991 to request that they provide services to the patients at the Hotel. At the same time, the BHA pressed the HRA for an increase in services to the HRA clients at the Hotel. In reliance on the advice of local AIDS care organizations, on March 8, 1991, defendant Roos, who was then president of the BHA, sent a letter to the HRA urging that it take steps to provide two on-site case managers and an on-site supervisor, and to require additional security at the Hotel. Complaint, Letter of William Roos, March 8, 1991.

 In mid-March 1991 the HRA made an unannounced visit to the Hotel and, apparently disturbed by the condition of the patients and the Hotel, froze further patient placements there. In late March, citing concern for its volunteers, the Brooklyn Chapter of the American Red Cross discontinued its meal delivery program at the Hotel, and citing the poor condition of the Hotel, discontinued its referral of displaced families to the Hotel.

 In the spring of 1991, Stanton, Executive Director of the BHA, participated in the preparation of the "Report on the St. George," an insert to the BHA newsletter, which discussed the possibility of conversion of the Hotel to permanent residential housing, the placement of HRA clients at the Hotel, and the increase in crimes within the Hotel as reported by the 84th Precinct.

 In June 1991, the HRA assigned two on-site case managers to the AIDS patients living at the Hotel. In response, on July 8, 1991, defendants Harris and Morgenstern sent a letter to the HRA thanking it for providing the case managers and informing the HRA of the existence of a Brooklyn Heights coalition aimed at augmenting the HRA's program. Complaint, Letter of Joan Harris and Benjia Morgenstern, July 8, 1991.

 In the fall of 1991, defendants Harris and Morgenstern wrote to members of the clergy in Brooklyn Heights to urge them and their parishioners to participate in the provision of services to the HRA clients at the Hotel. As a result of defendants' efforts, holiday meals and a food and clothing pantry were established for the HRA clients. Defendants also enlisted the support of the Brooklyn AIDS Task Force which agreed to provide counseling services to the HIV positive and AIDS patients living at the Hotel.

 Throughout the fall of 1991, defendants, the BHA, members of the community, and other community groups met to discuss ways to increase security within the Hotel and to explore various development options for the Hotel that would include space for AIDS patients and the elderly.

 In February 1992, the HRA case managers in the Hotel complained to the BHA of the failure of the HRA to provide necessary phone service to the managers and that the easy access to drugs for the HRA clients at the Hotel frustrated the case managers' efforts to persuade clients to move from the Hotel to permanent housing. On March 2, 1992, Morgenstern and Harris sent a letter to the HRA relaying the case managers' concerns.

 On February 25, 1992, Barbara Sabol, Administrator and Commissioner of the HRA, wrote to Councilmember Fisher's office to notify him that because of emergency demands for housing, the HRA had exceeded its cap of 65 patients, as set by the Mayor's Office, and had temporarily housed up to 69 patients at the Hotel. Sabol noted that the Mayor's Office had approved exceeding the cap in that instance, and that the HRA would not exceed it in the future. Finally, Sabol noted her appreciation of Fisher's work with the HRA's Division of AIDS Services ("DA"), "the [BHA], the Brooklyn AIDS Task Force, God's Love We Deliver [food service] and other community organizations to provide a range of social and support services to AIDS clients [at the Hotel]." Defendants' Memorandum of Law in Support of their Motion for Judgment on the Pleadings, App. B, Letter of Barbara Sabol, Feb. 25, 1992.

 The HRA has acknowledged that in July 1992, there were as many as 150 HRA clients housed at the Hotel. There are currently approximately 100 patients housed at the Hotel.

 On August 3, 1992, Morgenstern sent a letter to the HRA Division of AIDS Services inquiring as to the status of the case managers and asking whether or not the HRA had a contract for 65 clients with the Hotel. Complaint, Letter of Benjia Morgenstern, Aug. 3, 1992.

 II. Procedural History and Present Status of the Case

 On September 3, 1992 the Hotel St. George Associates filed suit in New York state court against defendants in response to their efforts to limit the number of HIV positive individuals and AIDS victims housed at the Hotel St. George and to affect the residents' living conditions. Only two defendants, William Roos and Julia Stanton, were served.

 Plaintiff brings this action pursuant to the Civil Rights Act of 1866, 42 U.S.C. Section 1981, 1982, 1985, 1985(3) and 1988; the Fair Housing Act of 1968, 42 U.S.C. §§ 3601, et seq; the New York Executive Law §§ 296 and 297; New York General Business Law 340 ...


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