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Harrington v. City of Lincoln

United States District Court, D. Nebraska

September 23, 2015

SHANE HARRINGTON and KALI RECORDS, LLC, Plaintiff,
v.
CITY OF LINCOLN, NEBRASKA, a municipal corporation, and TOM CASADY, JIM PESCHONG, and RUSSELL FOSLER, individually and in their official capacities as employees of the City of Lincoln and the State of Nebraska, Defendants.

MEMORANDUM AND ORDER

LYLE E. STROM, SENIOR JUDGE.

This matter is before the Court on the motion of defendants, City of Lincoln, Nebraska, a municipal corporation, Tom Casady, Jim Peschong, and Russell Fosler, individually, and in their official capacities as employees of the City of Lincoln (collectively “defendants”) to dismiss (Filing No. 60) the Third Amended Complaint (Filing No. 57) pursuant to Federal Rule of Civil Procedure 12(b)(6). The matter has been fully briefed by the parties. See Filing Nos. 62, 66, 69. After review of the motion, briefs, and relevant case law, the Court finds as follows.

BACKGROUND

In this action, plaintiff Shane Harrington and his business, Kali Records, LLC (herein after referred to as “plaintiff” singular) allege various constitutional and state law violations against defendants. Plaintiff’s claims arise from the denial of his liquor license.[1] Following the filing and amending of his initial complaint, defendants sought dismissal under Federal Rule of Civil Procedure 12(b)(6). Filing No. 15. Instead of responding to defendants’ motion, plaintiff sought to amend his complaint a second time. Filing No. 17. The Court denied plaintiff’s motion to amend. Filing No. 24 at 17. Following the Court’s order on February 6, 2015, granting in part and denying in part defendants’ motion to dismiss (Filing No. 15) in which certain parties and causes of action were removed, the plaintiff sought again to amend their complaint. Filing No. 34. The Court granted plaintiff’s motion to amend on May 13, 2015. In the Third Amended Complaint, [2] plaintiff brings causes of action under 42 U.S.C. § 1983 for (1) First Amendment Violations; (2) Fourteenth Amendment Due Process Violations; (3) Fourteenth Amendment Equal Protection Violations; (4) Privacy Violations under the Fourth, Ninth, and Fourteenth Amendments; (5) Negligent Hiring, Training and Supervision; and lastly (6) a state law claim for Tortious Interference with Business Relationships. Defendants again seek dismissal under Federal Rule of Civil Procedure 12(b)(6). Defendants argue the complaint ought to be dismissed against the officers based on qualified immunity, and ought to be dismissed against the City of Lincoln because the plaintiff “fails to show that the alleged constitutional violations were the result of an unconstitutional policy or custom of the City.” (Filing No. 62 at 5-6).

MOTION TO DISMISS STANDARD

Determining whether a complaint states a plausible claim for relief is “a context-specific task” that requires a court “to draw on its judicial experience and common sense.” Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 677-78, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). Federal Rule of Civil Procedure 8 requires a complaint to present “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). “[A] complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Braden, 588 F.3d at 594 (quoting Iqbal, 556 U.S. at 677-78) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678.

When considering a motion to dismiss under Rule 12(b)(6), well-pled allegations are considered to be true and are viewed in the light most favorable to the plaintiff. Braden, 588 F.3d at 591, 595. In viewing the facts in this light, the Court must determine whether the complaint states any valid claim for relief. Jackson Sawmill Co. v. United States, 580 F.2d 302, 306 (8th Cir. 1978). Recitations of elements of a cause of action with mere conclusory statements fail to meet Rule 8’s pleading requirements. Iqbal, 556 U.S. at 678. However, plaintiff may use legal conclusions to provide the framework of a complaint, so long as factual allegations support those legal conclusions. Id. at 678-79. Thus, a dismissal is likely “only in the unusual case in which a plaintiff includes allegations which show on the face of the complaint that there is some insuperable bar to relief.” Jackson Sawmill, 589 F.2d at 306.

DISCUSSION

1. PLAINTIFF’S SECOND AND FIFTH CAUSES OF ACTION

Plaintiff’s Third Amended Complaint asserts six causes of action, presumably against each of the four defendants. The Court concludes that plaintiff’s Second Cause of Action for Violations of Due Process under the Fourteenth Amendment and Fifth Cause of Action for Tortious Interference with Business Relationships should be dismissed as to all defendants under Federal Rule of Civil Procedure 12(b)(6) as discussed below.

A. PLAINTIFF’S SECOND CAUSE OF ACTION

Plaintiff’s second cause of action alleges “Fourteenth Amendment Due Process Violations.” (Filing No. 57 at 25). The Fourteenth Amendment provides that no state shall “deprive any person of life, liberty, or property without due process of law . . . .” U.S. Const. amend. XIV § 1. Plaintiff argues he was denied due process based on the lack of a “full and fair” hearing when he was denied his liquor license, and that the denial itself was not “reasonable and founded on a rational basis.” (Filing No. 57 at 26). Although a reading of the Third Amended Complaint would likely lead the Court to conclude that plaintiff’s claim is one of procedural and not substantive due process, the Court need not make this determination as the first requirement for either a substantive or procedural due process claim is the establishment of a protected liberty or property interest. See Filing No. 57 at 25-26. See also Richardson v. Nebraska State Patrol, No. 8:08CV211, 2008 WL 3823716 at *1 (D. Neb. Aug. 11, 2008) (citing Singleton v. Cecil, 176 F.3d 419, 424-25, 425 n.7 (8th Cir. 1999) (en banc)).

“‘To establish a violation of procedural due process, a plaintiff must show that he has been deprived of a constitutionally protected life, liberty, or property interest.’” Mulvenon v. Greenwood, 643 F.3d 653, 657 (8th Cir. 2011) (quoting Davenport v. Univ. of Ark. Bd. of Trs., 553 F.3d 1110, 1114 (8th Cir. 2009)); see also Richardson, 2008 WL 3823716 at *1 (explaining “claims regarding the right to either procedural or substantive due process must begin with identification of a protected liberty or property interest.”) (emphasis added). Nothing within the Third Amended Complaint reveals that plaintiff is claiming a depravation of either life or liberty. Plaintiff must therefore show he was deprived of a constitutionally protected property interest. When a constitutionally protected property interest is lacking, a due process violation cannot be established. See Mulvenon, 643 F.3d at 657. Protected property interests are “‘determined with reference to state law.’” Brian v. Westside Community School District, No. 8:05CV484, 2006 WL 2375482 at *6 (D. Neb. Aug. 14, 2006) (quoting Bishop v. Wood, 426 U.S. 341, 344, 96 S.Ct. 2074, 48 L.Ed.2d 684 (1976)); see also Board of Regents v. Roth, 408 U.S. 564, 577, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972) (“Property interests, of course, are not created by the Constitution. Rather, they are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law rules or understandings that secure certain benefits and that support claims of entitlement to those benefits.”).

Turning then to the issue of whether a liquor license creates a protected property interest under Nebraska state law, the Nebraska Supreme Court has conclusively held that “a liquor license is a purely personal privilege, does not constitute property, and vests no property rights in a licensee.” Bali Hai’, Inc. v. Nebraska Liquor Control Commission, 236 N.W.2d 614, 618 (Neb. 1975), see also Neb. Rev. St. ยง 53-149 (2015). Thus, Nebraska law leaves plaintiff without an argument concerning a property interest in a liquor license. Because plaintiff cannot ...


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