differently from anyone else who both had problems with alcohol and had been arrested.) The Court grants Defendants' Motion to Dismiss Count I of Plaintiffs' Complaint.
Count II - Due Process
Although many of the of the cases Plaintiffs cite, in support of Count II, address claims of procedural due process, Plaintiffs persist that Count II states a claim of substantive due process. (Plaintiff's Memorandum in Opposition to Defendants' Motion to Dismiss at 9-10.)
In determining whether the Plaintiffs have stated a claim for violation of their substantive due process rights, the Court must first decide whether Plaintiffs' claimed interest is a protected property or liberty interest under the Fourteenth Amendment. Polenz v. Parrott, 883 F.2d 551, 555 (7th Cir. 1989). In Reed v. Village of Shorewood, 704 F.2d 943, 948 (7th Cir. 1983), the Seventh Circuit held that, in deciding whether a liquor license was a property interest under the Fourteenth Amendment, the court must look beyond the Illinois Liquor Control Act, which described a liquor license as a personal privilege, and assess whether the license was property in the functional sense. The Reed court stated, "when viewed functionally, property is what is securely and durably yours, under state law, as distinct from what you hold subject to so many conditions as to make your interest meager, transitory or uncertain." Id. The Reed court stated further that, under Illinois law, a liquor license is securely and durably the licensee's because it is good for a year and because the criteria for renewal are not demanding which suggests that the Illinois legislature expected most licenses to be renewed as a matter of course. Id. at 948-49. Finally, because the safeguards against arbitrary revocation have been applied to prevent arbitrary non-renewal, the Reed court concluded that a licensee's interest in renewal is a property right for purposes of the Fourteenth Amendment. Id. at 949. But see, Black Knight Restaurant v. City of Oak Forest, 159 Ill. App. 3d 1016, 513 N.E.2d 109, 111 Ill. Dec. 863. (rejecting Reed and holding that a license to sell liquor is not a property right and thus not subject to due process protections.) Although there appears to be some dispute as to whether a liquor license is a property right under Illinois law, under the Seventh Circuit's holding in Reed, the Plaintiffs clearly have a property interest in the renewal of their liquor license for the Bailey Street store.
Whether Plaintiffs have a property interest in their liquor license application for Route 59 store cannot be determined at this time. The Court assumes that the City of Naperville has an ordinance which governs the issuance of liquor licenses. However, the parties have not provided the Court with a copy of or a citation to such ordinance. If the City of Naperville's ordinance contains substantive criteria which govern the issuance of liquor licenses, then Plaintiffs, assuming they met the substantive criteria, have a property interest because their right to a liquor license is vested by virtue of their mere application. See Wilcox v. Miller, 1990 U.S. Dist. LEXIS 19172, No. 89 C 20053, 1990 WL 304268 *3 (N.D. Ill. November 6, 1990). If, on the other hand, the Naperville ordinance governing the issuance of liquor licenses does not contain objective criteria, then Plaintiffs' interest is uncertain and transitory and not protected by the due process clause. Id.
Yet, even assuming Plaintiffs do have a property interest in both their renewal and their application for the liquor licenses, this Court must nevertheless dismiss Plaintiffs' substantive due process claim. The Seventh Circuit has expressed disapproval and reservations concerning the application of a substantive due process analysis to a claim based on a state created property interest. Polenz, 883 F.2d at 557 (citations omitted). Thus, in Polenz, the Seventh Circuit held that, where a plaintiff bases a substantive due process claim on a state created property interest, the plaintiff, in addition to attacking a decision of local zoning officials as arbitrary and irrational, must claim either a violation of some other substantive constitutional right or that the state law remedies are inadequate. Id. at 558-59. See Kauth v. Hartford Ins. Co. of Illinois, 852 F.2d 951, 956-58 (7th Cir. 1988)
Plaintiffs have certainly alleged that the decision of the liquor control commissioner was arbitrary and irrational. However, like the plaintiff in Polenz, Plaintiffs have not shown either a separate constitutional violation or the inadequacy of state law remedies. Accordingly, Plaintiffs' substantive due process claim must be dismissed.
The Court declines to exercise pendant jurisdiction over Plaintiffs' state law claim. Although a federal court may exercise pendant jurisdiction, this Court is mindful of the Supreme Court's admonition that, if the federal claims are dismissed before trial, then the state claims should be dismissed. United Mine Workers v. Gibbs, 383 U.S. 715, 726, 16 L. Ed. 2d 218, 86 S. Ct. 1130 (1972).
For the foregoing reasons, Defendants' Motion to Dismiss Plaintiffs' Complaint is granted.
JOHN A. NORDBERG
United States District Judge
DATED: August 25, 1994