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Labella Winnetka, Inc v. Thevillage of Winnetka and Douglas Williams

December 29, 2010

LABELLA WINNETKA, INC., PLAINTIFF-APPELLANT,
v.
THEVILLAGE OF WINNETKA AND DOUGLAS WILLIAMS, DEFENDANTS-APPELLEES.



Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 07 C 6633-Virginia M. Kendall, Judge.

The opinion of the court was delivered by: Flaum, Circuit Judge.

ARGUED OCTOBER 26, 2010

Before POSNER, FLAUM, and SYKES, Circuit Judges.

On February 28, 2007, a roof fire broke out at the Italian restaurant operated by LaBella Winnetka, Inc. in the Village of Winnetka, Illinois. The restaurant's doors have remained closed since that date. LaBella blames the Village and its manager, Douglas Williams, for preventing it from reopening the restaurant. LaBella appeals the district court's dismissal of its equal protection, substantive due process, procedural due process, and state law claims against the Village and Williams.

For the following reasons, we affirm the district court's judgment.

I. Background

LaBella opened its restaurant in the Village in 1993. The restaurant was located in a space LaBella leased from a private party ("the Landlord"). The lease was extended from time to time, with the last extension running through July 31, 2008. Also in 1993, LaBella applied for and received a Retail Liquor License from the Village. Each year between 1993 and 2007, the Village sent LaBella a liquor license renewal form, and renewed LaBella's license after LaBella submitted the completed form.

In February 2007, the Landlord hired roofers to do construction work on the roof above LaBella's restaurant. The Village and Williams (collectively "defendants") did not require the Landlord to obtain a building permit to perform the work. On February 28, 2007, LaBella informed defendants that the roofing contractor was using flammable materials to repair the roof, which might cause damage to the roof or building. Neither the Village nor Williams responded to LaBella's complaint. Later that day, the roof work caused a fire that damaged the roof over LaBella's main dining room, forcing LaBella to close. LaBella's kitchen, bar, and outdoor patio sustained no damaged from the fire.

LaBella applied for permits to repair the fire damage to its restaurant's interior, but defendants refused to issue any permits until the Landlord replaced the roof. Defendants also refused to allow LaBella to partition off the portion of the restaurant in need of repair and to reopen in the undamaged bar and outdoor patio areas.

Another restaurant-Corner Cooks-operated out of the same building as LaBella. Corner Cooks was permitted by defendants to reopen immediately after the fire. While LaBella was closed, defendants approved permits and designs for Corner Cooks to open Jerry's Restaurant in portions of the building that were still leased to LaBella, including the bar area in which defendants had refused to allow LaBella to reopen. LaBella contends that Corner Cooks and Jerry's Restaurant received special treatment because they were what Village employees referred to as "Friends of Doug," meaning businesses favored by Village Manager Williams. LaBella was not a Friend of Doug.

Another Friend of Doug is O'Neil's Restaurant. Between March 18, 2008 and June 16, 2009, defendants allowed O'Neil's Restaurant to remain open for business while a portion of its restaurant was partitioned-off for building repairs.

As noted above, LaBella held a Retail Liquor License issued by the Village; that license was set to expire on March 31, 2008. LaBella alleged that the Village and Williams "terminate[d]" LaBella's liquor license by not sending the annual renewal form to LaBella, as they routinely had done the previous fourteen years. Amended Cmplt. at ¶ 51B. The Village and Williams also allegedly approved "the issuance of a Class A-1 liquor license to Corner Cooks and Jerry's Restaurant at the same address as LaBella, and after doing so, . . . cancelled LaBella's Retail Liquor License-without cause, notice or a hearing." Id.

LaBella filed suit against the Village and Williams on November 26, 2007. In an amended complaint filed on April 3, 2008, LaBella asserted four claims against defendants: (1) a claim for violation of its equal protection rights under 42 U.S.C. § 1983 and the Fourteenth Amendment; (2) a claim for 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) a claim for 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) a claim for intentional interference with its lease and its prospective business expectancy.

Defendants filed a motion to dismiss the amended complaint, which the district court granted on March 18, 2009. LaBella filed a Rule 59(e) motion to alter or amend the judgment, which the ...


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