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PELFRESNE v. VILLAGE OF ROSEMONT

February 3, 1997

D. PELFRESNE, Trustee and S. EISENBERG, Plaintiffs,
v.
THE VILLAGE OF ROSEMONT, et al., Defendants.



The opinion of the court was delivered by: GETTLEMAN

 Plaintiffs, D. Pelfresne ("Pelfresne") and S. Eisenberg ("Eisenberg"), have filed a complaint against defendants, The Village of Rosemont ("Village"); Donald E. Stephens ("Stephens"), individually and as Village President; Lorraine Clemmensen ("Clemmensen"), John Dorgan ("Dorgan"), Anthony Esposito ("Esposito"), Jack Hasselberger ("Hasselberger"), Emmett Michaels ("Michaels"), Bradley Stephens ("Stephens"), individually and as members of Village Board of Trustees ("Board of Trustees"); Vito Corriero ("Corriero"), individually and as Director of Public Works; August Sansone ("Sansone"), individually and as Director of Purchasing and Commercial Leasing, alleging violations of Sections 1 and 2 of the Sherman Act (Counts I - V), 15 U.S.C. §§ 1 and 2, for which they request injunctive relief pursuant to Section 16 of the Clayton Act, 15 U.S.C. § 26, and attorneys' fees and costs. Plaintiffs also bring state law claims for breach of contract (Count VI), and misrepresentation and fraud (Count VII), for which they request permanent injunctive relief, damages, attorneys' fees, and costs. Defendants have filed the instant motion to dismiss all counts of the complaint pursuant to Fed.R.Civ.P. 12(b). For the reasons set forth below, defendants' motion is granted.

 FACTS1

 Pelfresne, as trustee, is legal title holder of a tract of land within the Village consisting of approximately 12.5 acres at the northwest corner of Higgins Road and River Road ("Parcel A"). Eisenberg, as trustee, is legal title holder of a tract of land within the Village known as 6250 N. River Road ("Parcel B") on which a masonry restaurant building stands. Both parcels are zoned DD Commercial use. On September 24, 1990, the Village, by and through Village President Stephens, entered into an agreement with plaintiffs' predecessor in title, which provided for the uninterrupted continuation of DD Commercial zoning and use and enjoyment of Parcels A and B, including the right to develop, for a term of not less than 15 years.

 Parcel A is presently devoted to agricultural use. Pelfresne has well-known intentions to develop Parcel A for one or more of the following uses: (a) Class A commercial office; (b) hotel; (c) retail; (d) gambling or casino; (e) restaurant. Pelfresne contends that the Village and the individually named defendants are his direct competitors in the acquisition, development, and operation of large commercial properties in interstate commerce within the Village.

 Eisenberg is in the business of owning, leasing, and operating restaurants in interstate commerce. Eisenberg and her predecessors in title have regularly leased Parcel B to food service operating tenants. Parcel B is zoned for restaurants and, according to plaintiffs, does not require a special use permit. Defendants, nevertheless, have denied permits and approvals to Eisenberg's prospective tenants. For example, on May 14, 1996, defendant Corriero, director of public works for the Village, refused to process Eisenberg's permit application for operating an International House of Pancakes restaurant on Parcel B on the grounds that a special use permit was required and that no action could be taken on the project until a hearing was held before the Zoning Board of Appeals.

 The Village contains eight street access restaurants in the moderate price range. Plaintiffs allege, on information and belief, that seven are owned by or located on land owned by the Village. Plaintiffs also contend that several of the named individual defendants and/or their close relatives hold financial interests in the eight restaurants. Plaintiffs further contend that the Village and several of the individually named defendants are owners/lessors of restaurants and, as such, are direct competitors of Eisenberg.

 On July 17, 1996, defendant Village of Rosemont caused a Notice of Proposed "Acquisition by the Village of Rosemont" to be sent to the plaintiffs' predecessor in title and submitted a precondemnation letter, stating in part that the Village intended to file an eminent domain action to acquire Parcels A and B as "public parks and open space." On July 29, 1996, plaintiffs filed a complaint in this court, alleging that defendants' denial of special use permits and institution of eminent domain proceedings constituted violations of federal antitrust statutes and various state laws. On August 20, 1996, the Village initiated eminent domain proceedings pursuant to which it seeks to acquire the plaintiffs' property. *fn2"

 In Count I of their complaint before this court, plaintiffs allege that the Village and the individually named defendants conspired to fix, control, raise and stabilize arbitrarily, unlawfully, unreasonably, and knowingly the rental price of restaurant operations in interstate commerce in the Village and to restrain trade in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1. In Count II, plaintiffs allege that the defendants' acquisition and control of Village restaurants was done in attempt to monopolize the ownership, leasing and operation of street access restaurants in the Village in violation of Section 2 of the Sherman Act, 15 U.S.C. § 2. In Count III, plaintiffs assert that defendants have restrained and monopolized the development of all large tracts of land, including Parcel A, in violation of Section 1 of Sherman Act. In Counts IV and V, plaintiffs allege that defendants have entered into a conspiracy to acquire Parcels A and B by a sham eminent domain proceeding in order to restrain and monopolize development in interstate commerce of tracts within the Village suitable for a casino gambling site in violation of Sections 1 (Count IV) and 2 (Count V) of the Sherman Act. In Counts VI and VII, plaintiffs assert state law claims for breach of contract and misrepresentation and fraud based on the 1990 agreement.

 Plaintiffs request the court to enter a permanent injunction pursuant to Section 16 of the Clayton Act, 15 U.S.C. § 26, compelling defendants to issue all permits required for restaurant use and cease all efforts to devalue or to acquire plaintiff's property. Plaintiffs also request reasonable attorneys' fees and costs. For their state law claims, plaintiffs request compensatory and punitive damages in excess of $ 64 million.

 Defendants have filed the instant motion to dismiss Counts I through V on the following grounds: (1) the Younger abstention doctrine; (2) the Anti-Injunction Act, 28 U.S.C. § 2283; and (3) state action immunity. Defendants also contend that the court should dismiss Counts VI and VII for lack of pendent jurisdiction. Because this court's decision is based on Younger abstention and the Anti-Injunction Act, it need not address defendants' arguments on state action immunity.

 DISCUSSION

 I. Standard

 Under Rule 12(b)(6), a court may dismiss a case "for failure to state a claim upon which relief may be granted." Fed.R.Civ.P. 12(b)(6). The motion is based on the sufficiency of the complaint, not the merits of the case. Triad Assocs., Inc. v. Chicago Housing Authority, 892 F.2d 583, 586 (7th Cir. 1989), cert. denied, 498 U.S. 845, 112 L. Ed. 2d 97, 111 S. Ct. 129 (1990). All well-pleaded facts will be taken as true, and all inferences are made in favor of the plaintiff. Montgomery Ward v. Warehouse Mail Order, Office, Technical and Professional Employees Union, 911 F. Supp. 1094, 1099 (N.D. Ill. 1995). Dismissal is proper only if it appears beyond doubt that the ...


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