The opinion of the court was delivered by: Lawrence M. McKenna, Usdj
Plaintiffs Kshel Realty Corporation ("Kshel")*fn1 and Stardial Communications Corporation d/b/a Irreplaceable Artifacts ("Stardial")*fn2 (collectively, "Plaintiffs"), on its own behalf and as "agent for consignors, secured parties and title holders of personalty," bring this action against the City of New York, the Department of Buildings of the City of New York (the "DOB"), the Department of Housing Preservation and Development of the City of New York (the "HPD"), various individuals who are employed by the City*fn3 (collectively, "the City"), Gateway Demolition Corporation ("Gateway") (a private contractor), Krzysztof Noga ("Noga") (a foreman of Gateway), and John Does 1-X*fn4 (all, collectively "Defendants").
Kshel is the deed owner of the real property and premises located at 14 Second Avenue in New York City, including a building which was once located on the property ("the Building"). (Compl.¶ 8.) Stardial, which is a commercial dealer of artifacts, was a tenant in the building, and maintained an art collection there of irreplaceable artifacts worth approximately twelve million dollars (Id. ¶¶ 9, 29, 30), including artifacts owned by certain consignors (Id. ¶ 29).
On July 13, 2000, a portion of the building's facade fell into a vacant area adjoining the building. (Id. ¶ 25.) That same day, the individual City defendants allegedly ordered the demolition of the building by Gateway without providing notice to plaintiffs. (Id. ¶ 26.) The demolition work was concluded on July 17, 2000. (Id. ¶ 62.) After or during the demolition, Plaintiffs allege that Gateway, Noga, and the individual City defendants looted the premises of its artifacts and sales and marketing information, and then sold many of those artifacts to Plaintiffs' business competitors. (Id. ¶¶ 34, 63-65.) Plaintiffs claim that the individual City defendants destroyed the Building to enrich the private contractors who own Gateway and to loot the subject premises of its valuables. (Id. ¶ 67.)
Plaintiffs now move for summary judgment, seeking a declaratory judgment that the City of New York's immediate emergency demolition procedures are unconstitutional. Defendants cross-move for summary judgment dismissing all counts in the Complaint.*fn5
A. Summary Judgment Standard
Summary judgment should be granted only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A dispute regarding a material fact is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
Once the moving party establishes a prima facie case demonstrating the absence of a genuine issue of material fact, the nonmoving party has the burden of presenting "specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). A court must accept as true all allegations of the nonmoving party that are supported by admissible evidence and draw all reasonable inferences in its favor. Kulak v. City of New York, 88 F.3d 63, 71 (2d Cir.1996)
While circumstantial evidence is considered, see Gayle v. Gonyea, 313 F.3d 677, 684 (2d Cir. 2002), mere speculation and conjecture are insufficient to defeat such a motion. Harlen Assocs. v. Inc. Vill. of Mineola, 273 F.3d 494, 499 (2d Cir. 2001); Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986) (citations omitted) (holding that the nonmoving party must "do more than simply show that there is some metaphysical doubt as to the material facts"); Scotto v. Alemenas, 143 F.3d 105, 114 (2d Cir. 1998) (citations omitted) (holding that the nonmoving party "may not rely on conclusory allegations or unsubstantiated speculation"). The issue ultimately is whether a fair-minded jury could return a verdict for the non-movant on all of the evidence. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986).
In general, "a municipality may demolish a building without providing notice and an opportunity to be heard if there are exigent circumstances which require immediate demolition of the building to protect the public from imminent danger." Wantanabe Realty Corp. v. City of N.Y., 315 F. Supp. 2d 375, 380 (S.D.N.Y. 2003); Calamusa v. Town of Brookhaven, 272 A.D.2d 426, 427 (N.Y. App. Div. 2d Dep't 2000).
Article 8 of the New York City Administrative Code delineates procedures for removing or repairing unsafe structures ("Unsafe Building Procedure" or "UBP"). N.Y.C. Admin. Code § 26-235 to 26-243. While the UBP does not specifically authorize the City to demolish a building without obtaining a precept from a New York Supreme Court, even in the event of an imminent threat to life or safety, the City's position is that it may do so. DOB Operations Policy and Procedure Notice # 16/93 ("OPPN") creates a two-tiered procedure for demolition of dangerous structures: 1) Where a building has suffered "life threatening structural damage" or "is in imminent danger of collapse," the DOB may issue a so-called Immediate Emergency Declaration pursuant to which it expects work to "begin by the day after the declaration;" 2) Where a building has "serious structural damage" or is in "a deteriorating condition when a collapse or failure is expected in the very near future," the DOB may issue an Emergency Declaration pursuant to which it expects demolition to begin within thirty to sixty days. (OPPN, Kurland Decl. Ex. G). Under both procedures, the DOB sends a notice to the owner, although it does not commence a UBP proceeding or seek a precept. Id.
Prior to the collapse of the Building on July 13, 2000, the DOB issued multiple Notices of Violation against Plaintiffs for unsafe improvements and maintenance. (City Defs.' 56.1 Stmt. ¶¶ 20-32 ("City Stmt.").) Defendants argue that Plaintiffs' reckless acts caused the collapse on July 13, 2000. (City Defs.' Mem. & Opp'n 1 ("City Mem.").) Plaintiffs argue that the cause of the collapse is unknown, and there was no emergency that justified the immediate demolition of the Building. (Pls.' Opp'n 1-2.)
On July 13, 2000, it is undisputed that there was a partial wall failure. (See City Stmt. ¶ 33; Pls.' Mem. 3.) The extent of the collapse is disputed. Plaintiffs claim that there was "a partial wall failure of the south wall of Plaintiffs' building" and that "[l]ess than 8% of the entire wall area of the building failed." (Pls.' Mem. 3 (citing Compl. ¶ 25).) Plaintiffs' expert, Beasley, stated that the partial wall failure created an opening 20 feet wide, but that the majority of the building was unaffected by the failure at the south wall, and the Building could have been preserved by shoring. (Beasley Decl. ¶¶ 19, 22-23.) Defendants claim that the collapse was much more extensive: A "bell shaped hole, approximately three-stories high, and 35 feet wide at the bottom, [had developed] in the south wall" (City Stmt. ¶ 75); "floors at the second and third floor levels had collapsed onto the ground level . . . the resulting debris had spilled out of the subject premises," "the remnants of the floors at the second and third floor levels . . . tilted downward, and [were] in great structural distress" (Id. ¶ 76); the "subject premises was loaded down with heavy load of storage of artifacts and antiques . . . the south wall was now collapsed and three or more floors had lost their structural support" (Id. ¶ 78); there were "dislodged and hanging structural beams [and] collapsed floors" (Id. ¶ 80); "floor slabs [were] sagging in large amounts, [and] the floor slabs were shifting and sloping downwards" (Id. ¶ 81); and the Building was too dangerous to allow personnel inside for shoring (Id. ¶ 89). (See also id. ¶ 77, 79, 82-92 (citing similar concerns and observations made by the New York City Fire Department).)
After the Department of Housing Preservation & Development and the DOB arrived at the scene, at least four DOB officials examined and inspected the Building: Am Islam, the Assistant Chief Inspector for DOB (City Stmt. ¶ 74, 99); James Cheng, an architect (Id. ¶ 73); Ronny Livian, an engineer and Borough Commissioner of Manhattan (Id. ¶¶ 70-71, 93-95); and Richard Visconti, an architect and Acting Commissioner of DOB (Id. ¶¶ 68-69). After making the above observations about the condition of the Building, Ronny Livian, who had the primary responsibility of making the determination that the Building needed to be demolished, verbally authorized the Immediate Emergency Declaration. (Id. ¶¶ 93, 95-97.) On July 13, 2000, DOB Manhattan Deputy Superintendent Manher Shah approved and signed the Immediate Emergency Declaration Form in the office, pursuant to a finding that the Building was in imminent danger of collapse. (City Stmt. ¶¶ 101-02; Pls.' Mem. 7.) Am Islam and James Cheng both wrote reports detailing the Building collapse; Cheng submitted his final report the following morning, July 14, 2000. (Id. ¶¶ 99-100; Pls.' Mem. 6.) The City did not obtain a precept from the Supreme Court or file an Unsafe Building Proceeding. (Id. 7.) The City did mail a notice to Plaintiffs, dated July 13, 2000 and postmarked July 14, 2000, stating that the Building had been declared in imminent peril and that it was Plaintiffs' responsibility to repair or demolish the Building.*fn7 (City Stmt. ¶ 18; Pls.' 56.1 Stmt. ¶ 10.) Plaintiffs and their attorney were present before and during the demolition.*fn8
The City then awarded the "emergency demolition" contract to Gateway Demolition Corporation on a non-competitive basis. (Pls.' 56.1 Stmt. ¶ 4; City Stmt. ¶ 122.) Demolition equipment arrived one hour later and demolition began immediately. During the demolition, some of Stardial's artifacts and customer contact lists were stolen; Plaintiffs discovered a number of the stolen artifacts in a warehouse belonging to Kevin Browne, their main competitor. (Pls.' 56.1 Stmt. ¶¶ 19-20.) Browne testified that he contracted to buy artifacts from Noga after Noga called Browne from the Building to report the demolition. (Browne Dep., Dec. 18, 2002, 11-52.) Browne testified that he visited the site during the demolition, paid Noga $2,700 cash, and picked up the artifacts a few blocks away from the Building. (Id.)
Stardial sought and obtained a temporary stay of the demolition through an Order to Show Cause on July 17, 2000. (Kurland Decl., Ex. DD.) On July 20, 2000, a court hearing in New York State Supreme Court resulted in a stipulation allowing the emergency shoring to continue (id. Ex. EE) and leaving the remainder of the demolition for Kshel to finish (City Stmt. ¶ 136).
III. Plaintiffs' Summary Judgment Motion
A. Constitutionality of the City's Interpretation of the Administrative Code in the OPPN
Plaintiffs move for summary judgment on their first cause of action (Count 1, Compl. ¶¶ 74-109), in which they seek a declaratory judgment that the DOB's immediate emergency procedure as stated in the OPPN is an unconstitutional interpretation of the Administrative Code.*fn9 (Pls.' Mem. 1-2.) Plaintiffs do not argue that the OPPN was unconstitutional as applied to them (Defendants seek summary judgment on that issue below), but rather they argue that the City's interpretation of the UBP in the OPPN is unconstitutional. Plaintiffs claim that the City's Immediate Emergency procedures are unconstitutional because the OPPN fails to consider minimum procedural safeguards (i.e. no predeprivation hearing, insufficient notice), fails to consider temporary measures, fails to preserve evidence for post-deprivation review, exercises police power unreasonably, and is too vague. Defendants argue that emergency procedures are broadly defined by the Supreme Court, see Hodel v. Va. Surface Mining & Reclamation Assoc., Inc., 452 U.S. 264, 298 (1981), and a predeprivation hearing and notice are not required in exigent circumstances, see Wantanabe Realty Corp. v. City of N.Y., 315 F. Supp. 2d. 375, 380 (S.D.N.Y. 2003). Defendants contend that a post-deprivation hearing before a state court is sufficient to meet the requirements of Constitutional due process.
The Court agrees with Defendants. It is uncontested that the City's Immediate Emergency procedures laid out in the OPPN are different than the UBP followed in non-emergencies. (City Stmt ¶ 42.) See also Wantanabe, 315 F. Supp. 2d at 390-91. The City admits the OPPN does not follow the UBP provisions in the Administrative Code. However, a local procedure's failure to satisfy the requirements of the Administrative Code, does not, by itself, constitute a deprivation of Constitutional due process. McDarby v. Dinkins, 907 F.2d 1334, 1337 (2d Cir. 1990). The Second Circuit has followed other Circuits in holding that "[a] breach of procedural requirements does not create a [federal] due process violation unless an individual was denied a fair forum for protecting his state rights." Id. (citations and quotations omitted.) As reasoned in McDarby, "a contrary rule would bring within the scope of section 1983 myriad claimed violations of local laws, thus confusing the separate provinces of state and national laws that are central to our federal system. . . . '[I]t is difficult to think of a greater intrusion on state sovereignty than when a federal court instructs state officials on how to conform their conduct to state law.'" Id. (citing Pennhurst State School & Hosp. v. Halderman, 465 U.S. 89, 106 (1984)).
The question, then, is whether the OPPN's Immediate Emergency procedures meet the basic notice and hearing requirements of procedural due process. First, the OPPN instructs the City to send a "Notice to Owners" -- "a letter . . . must be sent to the owner listed" on file. (OPPN, Kurland Decl. Ex G.) The notice is to be given to the "Inspector's Office by close of business the day after such emergency is declared." Id. As noted by Judge Kaplan in Wantanabe, as a practical matter, sending a letter even the same day would not give the owner notice before the demolition took place, because a letter presumably would not be received within twenty-four hours. Wantanabe, 315 F. Supp. 2d at 390, n. 90. However, such notice is sufficient ...