Cottom v. Town of Seven Devils ( 2002 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
LEONARD COTTOM; KASEY COTTOM; 
SKI HAWKSNEST, INCORPORATED;
HAWKSNEST FOOD & BEVERAGE,
INCORPORATED,
Plaintiffs-Appellants,
v.
THE TOWN OF SEVEN DEVILS; YARDY
WILLIAMS, in his official capacity;  No. 01-1875
JOE BUCHANAN, SR., in his official
and individual capacities,
Defendants-Appellees,
and
JOE BUCHANAN, JR., in his official
and individual capacities,
Defendant.

Appeal from the United States District Court
for the Western District of North Carolina, at Asheville.
Lacy H. Thornburg, District Judge.
(CA-00-89)
Argued: January 25, 2002
Decided: March 8, 2002
Before WILKINSON, Chief Judge, and WILKINS and
MICHAEL, Circuit Judges.
Affirmed by unpublished per curiam opinion.
2 COTTOM v. TOWN OF SEVEN DEVILS
COUNSEL
ARGUED: Samuel Ranchor Harris, III, WILSON & ISEMAN,
L.L.P., Winston-Salem, North Carolina, for Appellants. Andrew
James Santaniello, FRANK J. CONTRIVO, P.A., Asheville, North
Carolina, for Appellees. ON BRIEF: Grover Gray Wilson, WILSON
& ISEMAN, L.L.P., Winston-Salem, North Carolina, for Appellants.
Frank J. Contrivo, FRANK J. CONTRIVO, P.A., Asheville, North
Carolina; Rick Queen, Asheville, North Carolina, for Appellees.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
Plaintiffs Ski Hawksnest, Inc. and Hawksnest Food and Beverage,
Inc. (collectively "plaintiffs" or "Hawksnest") claim that the Town of
Seven Devils, the Town police chief, and the Town mayor (collec-
tively "the Town") retaliated against them in response to the exercise
of their First Amendment rights and violated their substantive due
process rights. Plaintiffs brought this action under 42 U.S.C. § 1983seeking damages for the allegedly unconstitutional conduct of the
Town’s police force. The district court granted summary judgment for
the Town. Because plaintiffs have failed to offer sufficient evidence
to establish any genuine issues of material fact, we affirm the judg-
ment of the district court.
I.
On April 26, 1997, a charity event known as the Spring Thaw Out
Party, organized by fraternity members from Appalachian State Uni-
versity, was held at the Hawksnest resort in the Town of Seven Dev-
ils, North Carolina. Prior to the party, Leonard and Kasey Cottom, the
operators and principal shareholders of Hawksnest, met with the
COTTOM v. TOWN OF SEVEN DEVILS 3
1
Town police chief and others to discuss security. This meeting was
held in part because prior Spring Thaw parties at another location had
led to community complaints regarding the rowdy and drunken
behavior of attendees. At this meeting, plaintiffs and the Town agreed
that undercover agents from the North Carolina Alcohol Law
Enforcement Division ("ALE") would be present at the party. How-
ever, the parties disagree over whether they decided that uniformed
Town police would also be present. Regardless, Town police attended
the party where at least six kegs of beer and assorted canned beer was
provided by plaintiffs for sale. Plaintiffs allege that the police caused
a disruption by, inter alia, interrogating and ticketing partygoers, con-
ducting foot patrols, inspecting beverages, and harassing women cus-
tomers. The party ended after ALE officers issued plaintiffs three
citations for, among other things, serving an intoxicated person and
selling alcohol to an underage guest.
Then, before a New Year’s Eve party in 1999, the Town police
chief requested that a fire marshal inspect Hawksnest. The chief
stated under oath that he requested the inspection because he had
learned that Hawksnest did not have an occupancy rating and he was
worried that if anything happened at a crowded New Year’s party, the
Town might be liable for not having properly inspected the building.
The fire marshal did not find any code violations and the party was
held as planned. Yet plaintiffs allege that at the party, the Town police
harassed them by conducting excessive patrols of the premises, shov-
ing Leonard Cottom aside, positioning themselves in a "riot line" in
the lounge, and departing suddenly, knocking over two unidentified
guests and creating alarm among the other guests in the process.
Plaintiffs claim that after the police left abruptly, the guests left too
and many vowed not to return to Hawksnest because the party had
been ruined by the police.
On January 3, 2000, the Cottoms, on behalf of Hawksnest, issued
a press release complaining about the police officers’ conduct at the
1
Leonard and Kasey Cottom were originally plaintiffs in this action.
However, the district court dismissed the Cottoms because only corpo-
rate entities, not individual shareholders, can sue on behalf of corpora-
tions. Plaintiffs did not appeal the Cottoms’ dismissal, so we need not
address this issue.
4 COTTOM v. TOWN OF SEVEN DEVILS
New Year’s party. Shortly thereafter on January 13, the Cottoms met
with Town officials, including the mayor and police chief, to discuss
the party. Plaintiffs allege that at this meeting, the mayor criticized
them for issuing the press release and stated that he would not apolo-
gize for the police action. And the police chief maintained that the
officers’ presence at the party constituted "routine patrol." After this
meeting, the Cottoms issued another press release, filed a complaint
with the Town, and Leonard Cottom spoke at a Town meeting regard-
ing the police behavior.
Plaintiffs claim on information and belief that after the Cottoms
began complaining, the Town police harassed them and their guests
by, inter alia, intensifying patrols of Hawksnest’s parking lot, increas-
ing the stops of guests and employees on their way to or from Hawks-
nest, issuing more than 500 warning tickets to travelers on the only
road into or out of the resort, following vehicles leaving Hawksnest
at close distances, and stopping the vehicles to conduct searches and
sobriety tests without probable cause. Plaintiffs assert that they lost
business because of this police conduct and guests’ fears that they
would be subject to police scrutiny if they visited Hawksnest.
On April 26, 2000, plaintiffs initiated this action, alleging that the
Town had retaliated against them in response to activities protected
by the First Amendment and had violated their substantive due pro-
cess rights by chilling their right to hold and promote large events at
Hawksnest.2 The district court granted summary judgment to the
Town with respect to all of plaintiffs’ claims. The court held that
plaintiffs’ First Amendment claim failed because, although plaintiffs
had engaged in activities protected by the First Amendment, plaintiffs
had not shown that the Town had taken "any actions against them in
response to the exercise of their First Amendment rights." The district
court found that plaintiffs’ substantive due process claim was best
understood as an allegation that the Town police violated their Fourth
Amendment rights to be free from unreasonable searches during the
2
Plaintiffs also claimed that the Town violated their equal protection
rights and that there was an unlawful conspiracy to deprive plaintiffs of
their constitutional rights. The district court granted summary judgment
to the Town with respect to these claims and plaintiffs have abandoned
them on appeal. Therefore, we do not address these issues.
COTTOM v. TOWN OF SEVEN DEVILS 5
Spring Thaw and New Year’s Eve parties. The court concluded that
this claim failed because plaintiffs had failed to produce "even a scin-
tilla" of admissible evidence demonstrating that the police officers’
actions were objectively unreasonable.3 Plaintiffs appeal.
II.
A.
Summary judgment is appropriate if there is no genuine issue as to
any material fact and the moving party is entitled to judgment as a
matter of law. Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477
U.S. 317, 322 (1986). A genuine issue exists when there is sufficient
evidence "such that a reasonable jury could return a verdict for the
nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248 (1986). And a party opposing a properly supported summary
judgment motion bears the burden of establishing the existence of a
genuine issue of material fact. See, e.g., id. at 248-49.
The Supreme Court has stressed that Rule 56 mandates the entry
of summary judgment "against a party who fails to make a showing
sufficient to establish the existence of an element essential to that
party’s case, and on which that party will bear the burden of proof at
trial." Celotex, 477 U.S. at 322. The Court has made clear that a prin-
cipal purpose of summary judgment "is to isolate and dispose of fac-
tually unsupported claims." Id. at 323-24. Yet in reviewing a grant of
summary judgment, we view the evidence in the light most favorable
to the nonmoving party. See, e.g., Cox v. County of Prince William,
249 F.3d 295, 299 (4th Cir. 2001).
However, a nonmoving party may not meet its burden by resting
upon mere allegations or bald assertions in the pleadings. Instead, the
"party’s response, by affidavits or as otherwise provided in [Rule 56],
must set forth specific facts showing that there is a genuine issue for
trial." Fed. R. Civ. P. 56(e); see also Celotex, 477 U.S. at 324; Ander-
3
The district court alternately concluded that the individual defendants
were entitled to qualified immunity on plaintiffs’ substantive due process
claim. Because we find that all of plaintiffs’ claims fail as an evidentiary
matter, we do not address qualified immunity.
6 COTTOM v. TOWN OF SEVEN DEVILS
son, 477 U.S. at 252. Rule 56 requires that a nonmoving party’s sup-
porting affidavits be based on personal knowledge and set forth facts
that would be admissible in evidence at a trial. Fed. R. Civ. P. 56(e).
Therefore, statements based solely on information and belief do not
satisfy the requirements of Rule 56. See, e.g., Toro Co. v. Krouse,
Kern & Co., 827 F.2d 155, 162 & n.3 (7th Cir. 1987); Minn. Mining
& Mfg. Co. v. Unites States Rubber Co., 279 F.2d 409, 415 (4th Cir.
1960). Likewise, hearsay statements, which would be inadmissible,
do not meet Rule 56’s standards. And "[m]ere speculation by the non-
moving party cannot create a genuine issue of material fact" sufficient
to survive a motion for summary judgment. Cox, 249 F.3d at 299.
B.
In order to prove a claim for First Amendment retaliation, plaintiffs
must establish three elements: (1) that their speech was protected by
the First Amendment; (2) that the defendants’ "alleged retaliatory
action adversely affected [their] constitutionally protected speech;"
and (3) "that a causal relationship exists between [their] speech and
the [defendants’] retaliatory action." Suarez Corp. v. McGraw, 202
F.3d 676, 685-86 (4th Cir. 2000). To satisfy this standard, it is essen-
tial that plaintiffs demonstrate that they "suffered some adversity in
response to [the] exercise of protected rights." ACLU v. Wicomico
County, 999 F.2d 780, 785 (4th Cir. 1993).
Plaintiffs have failed to meet their evidentiary burden. There is no
dispute that plaintiffs, through the Cottoms, engaged in protected First
Amendment activity when they issued press releases, filed a com-
plaint with the Town, and spoke at a Town meeting after the 1999
New Year’s Eve party. However, plaintiffs have failed to create a
genuine issue of material fact as to an essential element of their retali-
ation claim — they have not offered sufficient evidence from which
a reasonable jury could conclude that they suffered adversity in
response to the exercise of their rights. In fact, plaintiffs have failed
to demonstrate that the Town took any actions against them at all in
response to their complaints. Instead, plaintiffs have offered only alle-
gations and speculations to support their claim.
For example, plaintiffs allege on information and belief that the
Town police intensified patrols of Hawksnest’s parking lot following
COTTOM v. TOWN OF SEVEN DEVILS 7
the exercise of their First Amendment rights. To support this, plain-
tiffs rely on Leonard Cottom’s affidavit. However, his affidavit fails
to raise a genuine issue of material fact because it fails to provide any
admissible evidence. It simply states in a conclusory fashion, repeat-
ing plaintiffs’ complaint almost verbatim, that the police intensified
patrols. Such conclusory affidavits are insufficient to survive a motion
for summary judgment. See, e.g., Evans v. Techs. Applications &
Serv. Co., 80 F.3d 954, 962 (4th Cir. 1996).
Next, plaintiffs allege that the police increased the stops of Hawks-
nest guests and employees traveling to and from the resort. And plain-
tiffs contend that the police followed vehicles leaving Hawksnest at
close distances, only to stop the vehicles to conduct searches and
sobriety tests without probable cause. To support these claims, the
Cottoms have stated in affidavits and depositions that they received
complaints from guests and employees regarding the police activity.
However, as the district court noted, "[t]his is bare hearsay" which
does not raise a material issue of fact or add weight to plaintiffs’ posi-
tion. Notably, plaintiffs have failed to provide even one affidavit from
a patron or employee setting forth their personal knowledge of the
stops or stating that they stayed away from Hawksnest out of fear of
the police. In fact, plaintiffs have not even produced the full names
of any of the complaining citizens.
Plaintiffs also allege on information and belief that the Town police
issued more than 500 warning tickets to travelers on Skyland Drive,
the only road into or out of Hawksnest, and that the majority of these
tickets were issued to Hawksnest guests. Once again plaintiffs have
failed to provide any evidence to support this allegation. And more
importantly, plaintiffs have not established a baseline of the number
of citations issued before plaintiffs exercised their First Amendment
rights. Therefore, plaintiffs have not produced sufficient evidence
from which a reasonable jury could conclude that the police issued an
excessive number of tickets in retaliation for plaintiffs exercising their
First Amendment rights, or that police activity even increased in
response to plaintiffs’ exercise of their rights. Such a demonstration
is essential for plaintiffs to meet their burden of showing that they
suffered some adversity at the hands of the Town.
Plaintiffs claim that the Cottoms’ testimony regarding the police
activity they witnessed, their perceptions that the police activity
8 COTTOM v. TOWN OF SEVEN DEVILS
increased after their complaints, and their observations that Hawksn-
est’s business decreased following their comments are sufficient to
raise a disputed issue of material fact and survive summary judgment.
We disagree. As the district court noted, while Leonard Cottom stated
that he personally witnessed the police stopping Hawksnest guests,
"he neither identifies the dates of such occurrences nor alleges that he
has personal knowledge of the police increasing said stops after
[p]laintiffs exercised their First Amendment rights." Likewise, Kasey
Cottom’s assumptions and subjective perceptions regarding police
stops and searches of Hawksnest’s customers and employees are
insufficient to establish that the police increased the number of stops
or searches. Furthermore, the police stopping Hawksnest patrons must
be considered in light of the undisputed evidence that, both before and
after the Cottoms became owners of the resort, the police routinely
patrolled Hawksnest by conducting walk-throughs, inspecting the
parking lot, and setting up check points. Plaintiffs have simply failed
to offer evidence showing that the Town police increased or intensi-
fied their usual patrol activities in response to plaintiffs’ exercise of
their First Amendment rights. Therefore, plaintiffs cannot demon-
strate that any fall off in their business was a result of police conduct.
Plaintiffs also claim that the opinion of their expert, Gerald
Hotopp, serves as sufficient evidence to survive summary judgment.
We are similarly unpersuaded by this argument. As the district court
concluded, Hotopp’s opinion "adds nothing" to plaintiffs’ retaliation
claim. Hotopp simply assumed the truth of plaintiffs’ allegations and
concluded that the police conduct was improper. However, a party
cannot assure itself of a trial "merely by trotting out . . . [an] expert’s
naked conclusion about the ultimate issue" in the case. Weigel v. Tar-
get Stores, 122 F.3d 461, 469 (7th Cir. 1997) (internal quotation omit-
ted); see also, e.g., Alevromagiros v. Hechinger Co., 993 F.2d 417,
421 (4th Cir. 1993).
C.
We next turn to plaintiffs’ substantive due process claim. Like the
district court, we conclude that this claim is best understood as an
allegation that the Town police violated plaintiffs’ Fourth Amend-
ment rights to be free from unreasonable searches during the Spring
Thaw party in 1997 and the New Year’s Eve party in 1999. In the
COTTOM v. TOWN OF SEVEN DEVILS 9
context of a business such as Hawksnest, which is closely regulated
due to its license to serve alcoholic beverages, warrantless administra-
tive searches may be reasonable for Fourth Amendment purposes. See
New York v. Burger, 482 U.S. 691, 702 (1987). Indeed, it is undis-
puted that Hawksnest is subject to random searches by ALE agents
and local law enforcement officers because the resort holds a North
Carolina Alcoholic Beverage Control Commission ("ABC") permit.
See N.C. Gen. Stat. § 18B-502. In order for such an administrative
search to be reasonable under the Fourth Amendment, it must be con-
ducted with certainty, regularity, and neutrality. See Burger, 482 U.S.
at 703; see also Turner v. Dammon, 848 F.2d 440, 446-47 (4th Cir.
1988), abrogated on other grounds, Johnson v. Jones, 515 U.S. 304(1995). Nevertheless, the "burden on law enforcement officials in
conforming their conduct to Fourth Amendment standards is not great
in the area of traditionally regulated industries." Turner, 848 F.2d at
447. Therefore, plaintiffs must establish the existence of a genuine
issue of material fact as to the reasonableness of the Town police offi-
cers’ actions at the parties.
Plaintiffs have again failed to meet their evidentiary burden. We
agree with the district court that, even assuming the truth of plaintiffs’
allegations concerning the police conduct at the Spring Thaw and
New Year’s parties, plaintiffs have not produced "even a scintilla of
evidence" demonstrating the objective unreasonableness of the police
officers’ conduct. Instead, the undisputed facts indicate that there was
a legitimate need for the Town to exercise its law enforcement powers
at Hawksnest.
The Spring Thaw party was organized by local fraternity members
and, when it was previously held at another location, had been
plagued by community complaints regarding the rowdy and drunken
behavior of attendees. Such a history of violations and complaints is
a legitimate ground for increased police attention. See, e.g., Turner,
848 F.2d at 447. And plaintiffs have failed to produce evidence show-
ing the unreasonableness of the police activity at the party given the
police department’s knowledge of the complaints that had arisen in
previous years and the obvious potential for problems at the plaintiffs’
Spring Thaw party. The police knew that a substantial amount of
alcohol would again be served. In fact, there were at least six kegs of
beer in addition to assorted canned beer provided by plaintiffs for sale
10 COTTOM v. TOWN OF SEVEN DEVILS
and approximately 1,500 people were expected to attend. As it turned
out, plaintiffs received three citations from ALE officers at the party
for, inter alia, serving an intoxicated person and selling alcohol to an
underage guest.
Likewise, plaintiffs have failed to raise a genuine issue regarding
the reasonableness of the police conduct at the New Year’s Eve party
in 1999. It is undisputed that alcohol would be served. And there was
no lodging at Hawksnest, so the police knew that people would have
to drive following the party. On their face, these circumstances rea-
sonably justify police supervision, especially in light of Hawksnest’s
indisputable history of ABC violations. Plaintiffs’ allegation, based
only on information and belief, that the Town police chief requested
a fire inspection prior to the party out of some sinister desire to put
plaintiffs out of business is insufficient to create a genuine issue of
fact. See, e.g., Toro, 827 F.2d at 162 & n.3. Furthermore, plaintiffs
have failed to offer even one affidavit from a customer or employee
who claims they were harassed by the police at the New Year’s party.
And the police officers’ sudden departure from the party did not vio-
late plaintiffs’ constitutional rights — it is undisputed that the police
were responding to a call to assist a fellow officer engaged in a vehi-
cle chase approaching Hawksnest. Moreover, plaintiffs cannot iden-
tify the guests who were allegedly shoved to the ground in the course
of the exit and the Cottoms did not personally witness anyone being
knocked down. Likewise, plaintiffs have failed to produce any admis-
sible evidence that the guests were so alarmed by the police officers’
departure that they vowed to not return to Hawksnest.
The infirmity in this case is not that the plaintiffs’ claims could not
have been proven, but that the plaintiffs have failed to create a genu-
ine issue as to any material fact. Their evidence is simply not of suffi-
cient quality to reach a jury.
III.
For the foregoing reasons, we affirm the judgment of the district
court.
AFFIRMED