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Obsession Sports Bar & Grill, Inc. v. City of Rochester

United States District Court, W.D. New York

February 17, 2017

OBSESSION SPORTS BAR & GRILL, INC. and JOAN C. ORTIZ, Plaintiffs,
v.
THE CITY OF ROCHESTER, a municipal corporation, Defendant.

          For Plaintiffs: Michael A. Burger Katharine M. Felluca Santiago Burger LLP

          For Defendant: John M. Campolieto City of Rochester Law Department

          DECISION AND ORDER

          CHARLES J. SIRAGUSA United States District Judge

         INTRODUCTION

         Plaintiffs brought this action pursuant to 42 U.S.C. § 1983, alleging that the City of Rochester violated their federal constitutional rights by restricting the hours of operation of their restaurant and bar in a manner that was inconsistent with New York State law. Now before the Court are Plaintiffs' motion for partial summary judgment (Docket No. [#14]) and Defendant's cross-motion [#19] to dismiss the Amended Complaint for failure to state a claim. Plaintiffs' application is denied, Defendant's application is granted, and this action is dismissed.

         BACKGROUND

         On March 27, 2015, Plaintiffs filed the Amended Complaint [#4], which is the operative pleading in this action. The Amended Complaint alleges that Defendant “violated the Due Process clauses of the Fifth and Fourteenth Amendments to the United States Constitution by unlawfully preventing Plaintiffs from operating their lawful business[, Obsession Bar and Grill (“Obsession”), ] during all state-sanctioned hours of operation.” In particular, the Amended Complaint alleges that the City of Rochester improperly restricted Obsession's hours of operation, based upon a provision of the Rochester Municipal Code (Section 120-34(O)) that was “null and void, ” because it was “an impermissible exercise of municipal zoning power” insofar as it conflicted with the “New York State Alcoholic Beverages Control Law” (“ABC Law”), which regulates the hours that taverns may operate.[1]

         On August 24, 2011, the New York State Liquor Authority issued a liquor license to Plaintiffs, authorizing the retail sale of alcoholic beverages for on-premises consumption at Obsession. Thereafter, at all relevant times Plaintiffs operated Obsession in the City of Rochester. Pursuant to the ABC Law, as amended by Monroe County, New York, persons holding liquor licenses are permitted to sell alcohol from 8:00 a.m. until 2:00 a.m. on all days except Sunday, when they can sell alcohol from Noon until 2:00 a.m.. Additionally, the ABC Law permits such establishments to remain open until 2:30 a.m. to allow customers to consume their drinks.

         However, Obsession is located in Rochester's C-1 zoning district, which, according to the Rochester Municipal Code, “provides for small-scale commercial uses offering primarily convenience shopping and services for adjacent residential areas.” Significantly, at all relevant times the Municipal Code restricted the hours of operation for restaurants and bars in the C-1 district. Specifically, Code § § 120-35(H) & (I), which were later replaced by § 120-34(O), allowed bars and restaurants to remain open between 6:00 a.m. and 11:00 p.m.. Consequently, bars in the C-1 district were required to close at 11:00 p.m., while bars in other zoning districts were presumably permitted to remain open until 2:30 a.m.

         Plaintiffs applied for a variance, to allow Obsession to remain open until 2:00 a.m., Monday through Saturday. However, Defendant granted the application only in part, allowing Obsession to remain open until Midnight, from Monday through Thursday, and until 2:00 a.m. on Friday and Saturday. (Plaintiffs chose to keep Obsession closed on Sundays). Consequently, even with the variance, the City of Rochester required Obsession to close earlier than Obsession was required to do under the ABC Law on all days, and restricted Obsession from selling alcohol between Midnight and 2:00 a.m., as Obsession was permitted to do under the ABC Law, on all days except Fridays and Saturdays.

         On November 21, 2012, Plaintiffs filed an Article 78 Proceeding in New York State Supreme Court, Monroe County, alleging, inter alia, that Municipal Code § 120-34(O) was preempted by the ABC Law. Defendant argued that the ordinance was not preempted by the ABC Law, since it did “not concern itself directly with sale or consumption of alcoholic beverages.” However, Supreme Court agreed with Plaintiffs and held that § 120-34(O) was “an impermissible exercise of municipal zoning power, which [could] not stand in the face of conflicting and pre-emptive provisions of the ABC Law.” Supreme Court stated that the zoning provision was “null and void, ” as “being in derogation of the ABC Law.” This determination was affirmed on appeal by the New York State Supreme Court, Appellate Division Fourth Department.

         On March 17, 2015, Plaintiffs commenced the instant action pursuant to 42 U.S.C. § 1983, alleging that Municipal Code § 120-34(O) effected a due process violation by restricting Obsession's hours of operation below those permitted by the ABC Law. On May 21, 2016, Plaintiffs filed the subject motion for partial summary judgment as to liability. Plaintiffs contend therein that Defendant violated their substantive due process rights as a matter of law. In that regard, Plaintiffs contend that by enacting § 120-34(O), Defendant acted under color of state law to harm Plaintiffs' property interest in Obsession's Liquor License. Plaintiffs further contend that Defendant acted arbitrarily and capriciously by enacting a municipal zoning provision that was preempted by the ABC Law. In that regard, Plaintiffs allege that § 120-34(O) was “illegal, ” and that Defendant therefore acted “ultra vires.” See, Pl. Memo of Law [#14-2] at p. 1 (“[T]he City acted ultra vires, and thus arbitrarily, in depriving Plaintiffs of their vested property interest.”).

         Defendant opposes Plaintiffs' motion and has cross-moved to dismiss the Amended Complaint for failure to state a claim. In doing so, some aspects of Defendant's papers miss the mark. For example, Defendant misconstrues Plaintiffs' claim as being that they were improperly denied a variance. Defendant also mis-characterizes Plaintiffs' papers as raising claims of both substantive- and procedural due process. Nevertheless, Defendant contends, in pertinent part, that the Amended Complaint fails to plead a substantive due process claim because it does not allege any arbitrary or irrational conduct by the City of Rochester. Rather, Defendant maintains that it had a legitimate reason for enacting § 120- 34(O), which was to preserve the quality of life in the C-1 zoning district, which was largely residential, by reducing late-night noise and loitering around commercial establishments.

         On July 28, 2016, counsel for the parties appeared before the undersigned for oral argument. After carefully considering all of the parties' submissions, the Court concludes that Plaintiffs' substantive due process claim lacks merit as a matter of law, for the reasons discussed below.

         ANALYSIS

         Rule ...


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