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LaBella Winnetka, Inc. v. Village of Winnetka

March 18, 2009

LABELLA WINNETKA, INC. PLAINTIFF,
v.
THE VILLAGE OF WINNETKA AND DOUGLAS WILLIAMS, DEFENDANTS.



The opinion of the court was delivered by: Virginia M. Kendall, United States District Judge Northern District of Illinois

Judge Virginia M. Kendall

MEMORANDUM OPINION AND ORDER

Plaintiff LaBella Winnetka, Inc. ("LaBella" or "Plaintiff") filed suit against Defendants Village of Winnetka (the "Village") and Douglas Williams ("Williams") (collectively "Defendants") alleging various claims related to the enforcement of Village ordinances and codes in Winnetka. The Court previously dismissed LaBella's claims without prejudice, allowing LaBella to replead its claims. In its Amended Complaint, LaBella asserts three federal claims (Counts I-III) and one state law claim (CountIV): 1) violation of its equal protection rights under 42 U.S.C. § 1983 and the Fourteenth Amendment; 2) violation of its substantive due process rights under 42 U.S.C. § 1983 and the Fourteenth Amendment for deprivation of its property interest in its lease and restaurant business; 3) violation of its due process rights under 42 U.S.C. § 1983 and the Fourteenth Amendment for deprivation of its food and liquor licenses; and 4) intentional interference with its lease and its prospective business expectancy. Defendants move to dismiss the Amended Complaint pursuant to Fed. R. Civ. P. 12(b)(6). For the reasons stated, Defendants' Motion to Dismiss is granted.

PLAINTIFF'S ALLEGATIONS

The following allegations are taken as true, as the Court is required to do at the motion to dismiss stage. See Murphy v. Walker, 51 F.3d 714, 717 (7th Cir. 1995). LaBella operates an Italian restaurant in Winnetka, Illinois. (Compl. ¶ 2.)*fn1 The Village Council of Winnetka governs the Village, a municipal corporation located in Cook County, Illinois. (Compl. ¶ 3.) Williams, the Village Manager of Winnetka, directs and controls the business affairs of the Village, including the enforcement of Village ordinances and building codes, under the authority of the Village Council, Illinois statutes and Village ordinances. (Compl. ¶ 4.)

Since 1993, LaBella has leased property in Winnetka from a private party ("the Landlord") pursuant to an agreement that remained in effect until July 31, 2008 ("the Lease). (Compl. ¶ 8.) LaBella has fostered a broad customer base, earned a reputation for excellent Italian dining and expended large sums of money for its kitchen and dining areas as well as its operating equipment. (Compl. ¶¶ 10-11.) Additionally, LaBella obtained a restaurant license, a liquor license and other licenses and permits for its restaurant. (Compl. ¶ 13.)

On numerous occasions beginning in 2006, LaBella informed the Defendants that the Landlord failed to maintain the restaurant's roof, resulting in a defective roof that allowed water to pour into the restaurant through holes. (Compl. ¶ 18.) Although LaBella provided the Village with specific information regarding the roof's defective condition, Defendants did not require the Landlord to bring the roof into compliance with Village ordinances. (Compl. ¶¶ 18-19.) Ultimately, the Landlord retained roofers who attempted to repair the roof using hot tar, torches and other flammable materials. (Compl. ¶¶ 16-17.) The Village did not require the roofers to obtain work or building permits. (Compl. ¶ 16.) In spite of LaBella's complaints to the Village, Defendants did not enforce compliance with the Village's building code and safety requirements and they did not stop the Landlord from performing roof work that created the potential for fire hazards. (Compl. ¶¶ 16-17.) Nor did they inspect the roofers' work. (Compl. ¶ 17.)

On February 28, 2007, LaBella again informed Defendants of the unsupervised roof work, the roofers' use of flammable materials and the Landlord's failure to obtain a building permit. (Compl. ¶ 20.) Neither the Village nor Wiliams responded to LaBella's complaint. (Compl. ¶ 21.) That same day, the roof work caused a major fire that resulted in major damage to LaBella's roof. (Id.) The damage from the fire forced LaBella to close its restaurant. (Compl. ¶ 22.)

When LaBella applied for permits to repair the fire damage to its restaurant's interior, Defendants refused to issue the permits until the Landlord replaced the roof. (Compl. ¶¶ 22, 24(f).) In addition, Defendants refused to allow Labella to partially reopen the restaurant until and unless the Landlord replaced the restaurant's roof in compliance with the Village's codes, even after LaBella proposed partitioning off the portion of the restaurant that would be under repair. (Compl. ¶¶ 22, 27(c)(I).) Defendants knew or should have known that the Landlord did not attempt to replace the roof and that their refusal to allow LaBella to partially reopen its restaurant before completion of the roof repairs would force LaBella to remain closed without income or any projected date of reopening. (Compl. ¶ 24.) While LaBella was closed, Defendants met with representatives from competing restaurants housed within the same building as LaBella, such as Corner Cooks and Jerry's Restaurant. (Compl. ¶ 25.) At these meetings, Defendants approved permits and designs for those competing restaurants to occupy portions of the building that LaBella leased from the Landlord, including the bar area that LaBella had asked to reopen before the Landlord completed replacing the roof. (Id.)

Defendants engaged in selective enforcement of the Village's ordinances and codes to deprive LaBella of its "right" to keep its restaurant business and to force it out of business while simultaneously favoring other restaurants and businesses. (Compl. ¶¶ 26-27.) Defendants enforced Village ordinances, building codes, health and sanitation standards, liquor license requirements and safety requirements to the benefit of certain favored restaurants, including Corner Cooks, Jerry's Restaurant and O'Neil's Restaurant. (Compl. ¶ 27). Village employees referred to these favored restaurants as "Friends of Doug [Williams]." (Id.) LaBella was not a favored restaurant. (Id.)

With respect to the "selective enforcement" of village ordinances and building codes, Defendants: 1) intentionally ignored Corner Cooks' non-compliance with exhaust system requirements (Compl. ¶ 28(b)(ii)); 2) permitted Corner Cooks to open Jerry's Restaurant and approved permits and designs that would allow Corner Cooks and Jerry's restaurant to occupy a portion of LaBella's leased premises (Compl. ¶ 27(b)(iii)); and 3) permitted O'Neil's Restaurant to continue its cooking operations even though a portion of its restaurant is partitioned off for building renovations (Compl. ¶ 27(c)(ii)). In addition, LaBella claims that Defendants issued liquor licenses and special use ordinances to Corner Cooks to accommodate its non-complaint activities and failed to require that Corner Cooks comply with the standard evaluation procedure that LaBella underwent. (Compl. ¶ 27(b)(I).)

STANDARD OF REVIEW

When considering a motion to dismiss under Rule 12(b)(6), a court must accept as true all facts alleged in the complaint and construe all reasonable inferences in favor of the plaintiff. See Murphy, 51 F.3d at 717. To state a claim upon which relief can be granted, a complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). A plaintiff need not allege all facts involved in the claim. See Sanjuan v. Am. Bd. of Psychiatry & Neurology, Inc., 40 F.3d 247, 251 (7th Cir. 1994). However, in order to survive a motion to dismiss for failure to state a claim, the claim must be supported by facts that, if taken as true, at least plausibly suggest that the plaintiff is entitled to ...


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