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Kole v. Village of Norridge

United States District Court, N.D. Illinois

April 19, 2013

Tony Kole, et al., Plaintiffs,
Village of Norridge, et al., Defendants

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For Tony Kole, individually and as president and Manager of Ghost Industries, LLC, Plaintiff: Walter Peter Maksym, Jr., Attorney at Law, Chicago, IL.

For Village of Norridge, an Illinois municipal corporation, Defendant: Brent O. Denzin, Daniel Joseph Bolin, Thomas George DiCianni, Ancel, Glink, Diamond, Bush, DiCianni & Krafthefer, P.C., Chicago, IL.

For Ronald A. Oppedisano, individually and as President of the Village of Norridge, Ursula A. Kucharski, Dennis H. Stefanowicz, Dominic Sulimowski, Jacqueline Gregorio, Robert Martwick, individually and as Trustee of the Village of the Norridge, Defendants: Thomas George DiCianni, LEAD ATTORNEY, Brent O. Denzin, Ancel, Glink, Diamond, Bush, DiCianni & Krafthefer, P.C., Chicago, IL.

For Dominic S. Falagario, Defendant: Brent O. Denzin, Thomas George DiCianni, Ancel, Glink, Diamond, Bush, DiCianni & Krafthefer, P.C., Chicago, IL.


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Memorandum Opinion and Order

Honorable Thomas M. Durkin, United States District Judge.

Plaintiffs Tony Kole and Ghost Industries, LLC sued the Village of Norridge (the " Village" ) and various Village officials for allegedly impeding Plaintiffs' attempts to open and operate a gun store in the Village. Presently before the Court is Defendants' Motion to Dismiss Plaintiffs' Amended Complaint. R. 13. On March 22 and 28, 2012, the Court (Judge Norgle) issued orders (i) dismissing all claims against Village Police Chief James Jobe and Village Clerk Judith Bernardi and all individual-capacity claims against Village Attorney Mark Chester, R. 55, and (ii) dismissing all individual-capacity claims against the remaining Village officials. R. 54. This Order now addresses Plaintiffs' claims against the Village itself and the remaining official-capacity claims against the individual defendants. For the reasons explained below, Defendants' motion to dismiss is granted in part and denied in part. [1]

Legal Standard

A Rule 12(b)(6) motion challenges the sufficiency of the complaint. See, e.g.,

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Hallinan v. Fraternal Order of Police of Chicago Lodge No. 7, 570 F.3d 811, 820 (7th Cir. 2009). A complaint must include " a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). Under notice pleading standards, a plaintiff's " factual allegations must be enough to raise a right to relief above the speculative level." Bell Atlantic v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Put differently, a " complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Twombly, 550 U.S. at 570). " In evaluating the sufficiency of the complaint, [courts] view it in the light most favorable to the plaintiff, taking as true all well-pleaded factual allegations and making all possible inferences from the allegations in the plaintiff's favor." AnchorBank, FSB v. Hofer, 649 F.3d 610, 614 (7th Cir. 2011). Courts also " consider documents attached to the complaint as part of the complaint itself." Reger Dev., LLC v. Nat'l City Bank, 592 F.3d 759, 764 (7th Cir. 2010). The following background is a summary of Plaintiffs' allegations, viewed in the light most favorable to Plaintiffs.


On November 16, 2010, Plaintiffs applied to the Village for a weapons dealer business license. They wanted to open a gun store in the Village at 7601 West Montrose Avenue, Suite 2. At the time, a Village ordinance (the " Ordinance" ) provided that it was unlawful to sell firearms without a license from the Village. See Village of Norridge Code of Ordinances § 22-361 (1972). Plaintiffs executed a lease for the premises while they were waiting for the Village to issue the weapons dealer business license and for the Bureau of Alcohol, Tobacco, Firearms, and Explosives (" ATF" ) to issue their Federal Firearms License.

The ATF arranged an inspection of the premises as part of the Federal Firearms License application process. [2] But the ATF cancelled the inspection after the Village refused to give an approval to proceed and told the ATF that Plaintiffs would not be allowed to transfer firearms on the premises.

Shortly thereafter, the Village informed Plaintiffs that it was reluctant to issue them a license because " God forbid something should ever happen." Although the Ordinance generally allowed licensed gun stores, there were no gun stores in the Village. The Village originally enacted the Ordinance to accommodate K-Mart, but by 2010, K-Mart had voluntarily stopped selling firearms.

On November 30, 2010, Plaintiffs--under economic duress, they allege-- ultimately entered into an agreement with the Village (the " Agreement" ). The Agreement provides that the Village would issue Plaintiffs a weapons dealer business license, but subject to strict terms and conditions. Taken together, the terms and conditions require Plaintiffs to sell guns over the Internet and by mail, instead of through in-person retail sales. Those terms and conditions include:

o Plaintiffs may not deliver firearms or ammunition to any recipient at the premises;
o All deliveries from the premises must be sent in unmarked packaging

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for used firearms and in the original packaging for new firearms;
o Plaintiffs cannot store firearms or ammunition on the premises overnight or for more than 12 hours a day, and any inventory must be disabled by a locking device or secured in a locked cabinet;
o Plaintiffs cannot maintain a sales or retail display of firearms or ammunition on the premises;
o Plaintiffs cannot post exterior signage advertising their location to the public or indicating that they sell firearms and must comply with limits on interior signage;
o Plaintiffs' officers and employees must submit to fingerprinting and annual criminal background checks, at the Village's expense;
o Plaintiffs must install and maintain a video surveillance system;
o Plaintiffs must abide by monthly limits on the quantity of firearms and ammunition received at the premises and a limit on the quantity of firearms and ammunition that may be on the premises at any one time; and
o Plaintiffs must allow one random and two scheduled inspections of the premises per month.

In addition to the terms and conditions in the Agreement, the Ordinance itself also requires Plaintiffs to provide daily reports of their firearm sales to the Village Police Chief. See Village of Norridge Code of Ordinances § 22-362 (1972).

Under the Agreement, Plaintiffs' license was for an initial one-year term, subject to renewal for two additional one-year terms as long as Plaintiffs complied with the terms of the Agreement. The Agreement also exempts Plaintiffs from any changes made to the Ordinance during that three-year time period, including if the Village later repealed the Ordinance and banned gun stores outright.

With the Agreement in place, Plaintiffs moved forward. The ATF conducted its inspection and issued Plaintiffs a Federal Firearms License on January 18, 2011. Plaintiffs then began to operate their business out of the premises.

Shortly thereafter, on February 9, 2011, the Village amended its ordinance (the " Revised Ordinance" ) as the parties apparently anticipated. The Revised Ordinance limits the number of weapons dealer business licenses to one ( e.g., the license issued to Plaintiffs) through April 30, 2013. As of April 30, 2013, the Revised Ordinance terminates that type of license altogether and bans gun stores from the Village. As a result, once the Agreement and its three-year exemption from the Revised Ordinance expires on November 30, 2013, Plaintiffs may be forced to close up shop, or at least relocate their business outside the Village.

On February 14, 2011, Village Trustee Dominic Falagario told the Norridge Harwood Heights News--falsely, according to Plaintiffs--that " the one current Village weapons dealer licensee has agreed that it will cease doing business in the village no later than April 30, 2013."

On June 7, 2011, Plaintiffs filed this lawsuit against the Village, Village President Ronald Oppedisano, Village Trustees Ursula Kucharski, Dennis Stefanowicz, Dominic Sulimoski, Dominic Falagario, Jacqueline Gregorio, and Robert Martwick, Village Police Chief James Jobe, Village Clerk Judith Bernardi, and Village Attorney Mark Chester. The 73-page Amended Complaint is divided into 18 counts with 9 federal and 9 pendant state law claims (as discussed below, because many of the counts combine multiple theories into a single count, Plaintiffs actually assert well over 18 legal theories). In

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short, Plaintiffs allege injuries related to (1) the review process while the Village was considering their license application, (2) the terms and conditions imposed by the Agreement, and (3) the Revised Ordinance's upcoming ban on gun stores. Plaintiffs seek various remedies, including compensatory damages and injunctive and declaratory relief.


Count I: 42 U.S.C. § 1983 -- U.S. Const. Amends. I, II, IV, V & XIV

Count I contains a hodgepodge of constitutional claims pursuant to 42 U.S.C. § 1983, which provides a cause of action against " [e]very person who, under color of [law], subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws." In Count I, Plaintiffs allege violations of the First, Second, Fourth, and Fifth Amendments (incorporated against local governments under the Fourteenth Amendment). Plaintiffs' Second Amendment claim broadly attacks the Agreement's terms and conditions and the Revised Ordinance's upcoming ban on gun stores. Plaintiffs' other claims are less clear and are often only explained, if at all, in Plaintiffs' response to Defendants' motion to dismiss. Plaintiffs' First Amendment claim is based on the Agreement's restrictions on retail displays and exterior signage and also alleges that the Agreement and Revised Ordinance are unlawful prior restraints. Plaintiffs' Fourth Amendment claim is based on the Agreement's provision allowing the Village to conduct monthly inspections of the premises and the Ordinance's requirement that Plaintiffs report gun sales to the Village Police Chief. Plaintiffs' Fifth Amendment claim appears to raise due process and potentially takings issues related to the review process for Plaintiffs' license application and the Village's decision not to renew their license after the Agreement expires in November 2013.

As noted above, Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain " a short and plain statement of the claim showing that the pleader is entitled to relief." Rule 8(d)(1) similarly requires that " [e]ach allegation must be simple, concise, and direct." Fed.R.Civ.P. 8(d)(1). And Rule 10(b) requires that " each claim founded on a separate transaction or occurrence . . . must be stated in a separate count" if " doing so would promote clarity." Fed.R.Civ.P. 10(b).

As the court explained Rule 10(b) in Second Amendment Arms v. City of Chicago, 2012 WL 4464900, at *9 (N.D. Ill. Sept. 25, 2012): [3]

Requiring separate counts serves two purposes: (1) it gives fair notice to the defendants of the claims against them; and (2) it enables the court to grant relief on an entire count, not just part of a count. See Livingston v. Vill. of Dolton, 2003 WL 1463635, at *6 (N.D. Ill. Mar. 20, 2003). As another court in this district has recently explained, " The [lode]star of Rule 10 is intelligibility, good organization, and basic coherence." Awalt v. Marketti, 2012 WL 1161500, at *10 (N.D. Ill. Apr. 9, 2012).

Moreover, although " [o]ne set of facts producing one injury" generally " creates one claim to relief, no matter how many laws the deeds violate," multiple legal theories, if they are " sufficiently distinct that they call for proof of substantially different

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facts[,] may be separate 'claims.'" NAACP v. Am. Family Mut. Ins. Co., 978 F.2d 287, 292 (7th Cir. 1992); see also Alioto v. Town of Lisbon, 651 F.3d 715, 721 (7th Cir. 2011) (" [A] court may require that allegations be grouped into logical counts for claims that are 'founded on' separate transactions or occurrences." ).

Count I fails to comply with Rules 8(a)(2), 8(d)(1), and 10(b). It fails to provide Defendants with even basic notice of the grounds for each constitutional claim, particularly because it lumps together four or five different constitutional amendments with little explanation of how Defendants allegedly violated each amendment. See, e.g., Stanard v. Nygren, 658 F.3d 792, 800 (7th Cir. 2011) (criticizing a similar § 1983 count that alleged " in a wholly conclusory fashion that the defendants had violated [the plaintiff's] First, Fourth, Fifth, Eighth, and Fourteenth Amendment rights" without specifying the basis for the alleged violation of each amendment). Plaintiffs' response to Defendants' motion to dismiss does not help matters, as it too blends its discussion of these constitutional issues over the course of 22 pages addressing Count I. R. 36 at 5-27. Although all of the theories may be based on the same general events--the Agreement, Revised Ordinance, and surrounding circumstances--each constitutional claim naturally has a different focus and will involve, at least in part, proof of different facts.

Defendants' motion to dismiss Count I is therefore granted, with leave for Plaintiffs to amend their complaint to comply with Rules 8(a)(2), 8(d)(1), and 10(b). In particular, Plaintiffs should separate their various constitutional claims into individual counts--one count for each constitutional amendment at issue setting forth a short and plain statement of how Defendants violated the amendment should suffice. In splitting up Count I, Plaintiffs should also take care to avoid duplicative pleading. For example, although Count I makes some general references to the First Amendment, Plaintiffs already assert more specific First Amendment claims in Count III. If Count I adds nothing new on those First Amendment issues, Plaintiffs should leave the First Amendment issues to Count III.

Normally, the Court would stop there on Count I. However, Defendants' motion to dismiss has been pending for some time, and the parties have extensively briefed at least some of these constitutional issues. Based on the current briefing, the Court can and will address Plaintiffs' Second and Fourth Amendment claims-- at least for purposes of a motion to dismiss--in order to avoid requiring the parties to brief these issues again after Plaintiffs amend their complaint. [4]

Second Amendment

In their motion to dismiss, Defendants argue that Plaintiffs fail to state a plausible claim for relief under the Second Amendment because there is no constitutional right to sell firearms. Defendants further argue that under the Supreme Court's decisions in District of Columbia v. Heller, 554 U.S. 570, 626-27, 128 S.Ct. 2783, 171 L.Ed.2d 637 & n.26 (2008), and McDonald v. City of Chicago, 130 S.Ct. 3020, 3047,

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177 L.Ed.2d 894 (2010), " laws imposing conditions and qualifications on the commercial sale of arms" are " presumptively lawful regulatory measures." Defendants therefore reason that " [w]hat little justification is required to support any of the Village's regulatory efforts here is clearly met on the face of the Complaint." R. 40 at 9.

Plaintiffs may or may not prevail on their Second Amendment claim, but the Court cannot resolve the merits of the claim on a motion to dismiss. As Judge Hamilton recently observed in dissenting from the denial of rehearing en banc in Moore v. Madigan, 708 F.3d 901, 904-05 (7th Cir. 2013), " where courts will need to weigh both Second Amendment rights and state interests justifying some restrictions on those rights, actual evidence on the burdens, consequences, and governmental interests will be vital for sound judgment" ; " a trial court can do a great service by ensuring the development of a thorough and complete record that provides a reliable, accurate factual foundation for constitutional adjudication." This deliberate approach is fully warranted here--the Second Amendment issues in this case are not as simple as Defendants suggest.

In Heller, 554 U.S. at 635, the Supreme Court struck down the District of Columbia's ban on the possession of handguns. Heller 's " central holding" is " that the Second Amendment protects a personal right to keep and bear arms for lawful purposes, most notably for self-defense within the home." McDonald, 130 S.Ct. at 3044. The Supreme Court also confirmed that " [l]ike most rights, the right secured by the Second Amendment is not unlimited." Heller, 554 U.S. at 626. Thus, the Supreme Court explained that " nothing in our opinion should be taken to cast doubt on longstanding prohibitions on the possession of firearms by felons and the mentally ill, or laws forbidding the carrying of firearms in sensitive places such as schools and government buildings, or laws imposing conditions and qualifications on the commercial sale of arms." Id. at 626-27. In a footnote, the Supreme Court described these measures as " presumptively lawful," id. at 627 n. 26, and " repeat[ed] those assurances" in McDonald, 130 S.Ct. at 3047.

Although the Supreme Court explained that laws regulating the commercial sale of firearms are " presumptively lawful," it did not purport to exempt those laws from constitutional scrutiny. To the contrary, the Supreme Court made clear that the standard of review must be more exacting than rational basis review: " If all that was required to overcome the right to keep and bear arms was a rational basis, the Second Amendment would be redundant with the separate constitutional prohibitions on irrational laws, and would have no effect." Heller, 554 U.S. at 629 n. 27. See also Ezell v. City of Chicago, 651 F.3d 684, 701 (7th Cir. 2011) (explaining that Heller " specifically excluded rational-basis review" ); United States v. Skoien, 614 F.3d 638, 641 (7th Cir. 2010) (" We do not mean that a categorical limit on the possession of firearms can be justified under the rational-basis test, which deems a law valid if any justification for it may be imagined. If a rational basis were enough, the Second Amendment would not do anything." ) (citations omitted).

The Seventh Circuit's analysis in United States v. Williams, 616 F.3d 685 (7th Cir. 2010), is particularly instructive. Williams involved 18 U.S.C. § 922(g)(1)'s ban on the possession of firearms by felons--one of the other " presumptively lawful" regulatory measures specifically identified in Heller. Nonetheless, the Seventh Circuit explained that " the government does not get a free pass" ; " it still must prove that the ban is constitutional, a mandate

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that flows from Heller itself" ; and " putting the government through its paces in proving the constitutionality of § 922(g)(1) is only proper." Williams, 616 F.3d at 692. The Seventh Circuit ultimately applied a form of intermediate scrutiny and upheld § 922(g)(1). Id. at 692-93. [5]

As a result, although Heller and McDonald described certain laws as " presumptively lawful," the Supreme Court did not create an actual presumption that a plaintiff is required to " rebut," as Defendants appear to suggest. R. 40 at 10. Defendants are still required to establish that their regulatory efforts are constitutional. And in any event, at least with respect to the Revised Ordinance, the Village is seemingly doing more than just " imposing conditions and qualifications on the commercial sale of arms" --it is trying to ban gun stores outright.

To resolve the Second Amendment issues present in this case, the Court will need to follow the two-part framework established in Ezell, 651 F.3d at 701-03, 708-09. " First, the threshold inquiry . . . will be a 'scope' question: Is the restricted activity protected by the Second Amendment in the first place?" Id. at 701. As the Seventh Circuit explained, the answer to this question " requires a textual and historical inquiry into the Second Amendment's original meaning." Id. Second, if the regulated activity is not outside the scope of the Second Amendment, " then there must be a[n] . . . inquiry into the strength of the government's justification for restricting or regulating the exercise of Second Amendment rights." Id. at 703. " [T]he rigor of this judicial review will depend on how close the law comes to the core Second Amendment right and the severity of the law's burden on the right." Id. As the Seventh Circuit explained:

First, a severe burden on the core Second Amendment right of armed self-defense will require an extremely strong public-interest justification and a close fit between the government's means and its end. Second, laws restricting activity lying closer to the margins of the Second Amendment right, laws that merely regulate rather than restrict, and modest burdens on the right may be more easily justified. How much more easily depends on the relative severity of the burden and its proximity to the core of the right.

Id. at 708.

The threshold scope inquiry here involves two separate issues. The first is whether Plaintiffs have a Second Amendment right to sell firearms. The Second Amendment does not expressly address a right to sell firearms (" the right of the people to keep and bear Arms, shall not be infringed" ); Heller and McDonald each only address a personal right to keep and bear arms; and, as Defendants note, some courts have suggested that there is no right sell firearms. United States v. Chafin, 423 Fed.Appx. 342, 344 (4th Cir. 2011) (unpublished); United States v. Conrad, 923 F.Supp.2d 843, 2013 WL 546373, at *7-8 (W.D. Va. Feb. 13, 2013); Montana Shooting Sports Ass'n v. Holder, 2010 WL 3926029, at *21 & n.17 (D. Mont. Aug. 31, 2010).

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The Court does not need to resolve that issue now, however, because even if the Second Amendment does not protect the sale of firearms directly, Plaintiffs can still pursue a claim that the Agreement and Revised Ordinance infringe their customers' personal right to keep and bear arms. Surprisingly, although the parties argue at length about whether Plaintiffs have standing on behalf of their customers, no one discusses Ezell, which addressed this very issue. Ezell involved a challenge to Chicago's firing range ban. One of the plaintiffs in that case was Action Target, a firing range operator. As the Seventh Circuit held, " Action Target, as a supplier of firing-range facilities, is harmed by the firing-range ban and is also permitted to 'act[] as [an] advocate[] of the rights of third parties who seek access to' its services." Ezell, 651 F.3d at 696 (quoting Craig v. Boren, 429 U.S. 190, 195, 97 S.Ct. 451, 50 L.Ed.2d 397 (1976), and citing Pierce v. Soc'y of Sisters, 268 U.S. 510, 536, 45 S.Ct. 571, 69 L.Ed. 1070 (1925), and MainStreet.Org of Realtors v. Calumet City, 505 F.3d 742, 746-47 (7th Cir. 2007)). Defendants have not offered any basis to distinguish Ezell. This Court is obligated to follow it and finds that Plaintiffs have standing to advocate on behalf of their customers.

Threshold issues aside, the Court will then need to analyze the strength of Defendants' justifications for the Agreement and Revised Ordinance. Defendants ask the Court to uphold their actions based largely on a statement in the Revised Ordinance's preamble that " the amendments set forth herein . . . improve the health, safety and welfare of the Village." R. 40 at 9-10; Am. Compl., Ex. D. But this conclusory statement likely would not satisfy even rational basis review, let alone the heightened scrutiny required under the Second Amendment. At this stage, the Court does not need to decide how heavily the Agreement and Revised Ordinance burden the Second Amendment right to keep and bear arms--including what the Seventh Circuit has described as a " corresponding right to acquire" firearms, Ezell, 651 F.3d at 704--or how strong of a justification Defendants will need to establish in order to uphold their actions in this case. Under any standard, Defendants' motion to dismiss falls short. As in Williams, the Court must " put[] the government through its paces" to justify its regulatory efforts.

Defendants offer two other arguments related to Plaintiffs' Second Amendment claim. Defendants argue that the Agreement exempts Plaintiffs from the Revised Ordinance and that as a result, Plaintiffs' professed " fear" that the Revised Ordinance will be applied against them is not an actionable injury. But Plaintiffs' concern is hardly speculative. Although the Agreement does exempt Plaintiffs from the Revised Ordinance, that exemption will expire with the Agreement on November 30, 2013. And by eliminating the one remaining weapons dealer business license, the Revised Ordinance clearly targets Plaintiffs. In Ezell, 651 F.3d at 695-96, the Seventh Circuit explained that " [i]t is well-established that pre-enforcement challenges . . . are within Article III" and that " [t]he very existence of a statute implies a threat to prosecute, so pre-enforcement challenges are proper, because a probability of future injury counts as 'injury' for the purpose of standing." (Citations omitted.) The same is true here. The threat that Plaintiffs will soon have to close their business is a sufficient injury to confer standing.

Defendants also argue that Plaintiffs cannot maintain a claim related to the Agreement because they voluntarily agreed to its terms. In response, Plaintiffs rely on the " unconstitutional conditions" doctrine, which generally " prevents

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the government from awarding or withholding a public benefit for the purpose of coercing the beneficiary to give up a constitutional right or to penalize his exercise of a constitutional right." Planned Parenthood of Ind., Inc. v. Comm'r of Ind. State Dep't of Health, 699 F.3d 962, 986 (7th Cir. 2012). " Understood at its most basic level, the doctrine aims to prevent the government from achieving indirectly what the Constitution prevents it from achieving directly." Id. Defendants do not directly address this issue in their reply. As a result, at least for purposes of this motion to dismiss, Defendants have not shown that Plaintiffs fail to state a plausible Second Amendment claim related to the Agreement's terms and conditions. The Court expresses no opinion at this stage as to whether Plaintiffs were in fact coerced into signing the Agreement or whether the unconstitutional conditions doctrine ultimately applies in ...

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