Aida Food & Liquor, Inc. v. City of Chicago

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 05-2059
AIDA FOOD AND LIQUOR, INC., and EASSA FAKHOURY,
Plaintiffs-Appellants,
v.
CITY OF CHICAGO, a municipal corporation,
JOHN ROBERSON, individually and in his capacity
as Department of Buildings Commissioner,
TIMOTHY HUTCHISON, individually and in his
capacity as Department of Buildings Assistant
Commissioner, DON GIBSON, individually and
in his capacity as Department of Buildings
Inspector, CECILE COFFMAN, individually and
in her capacity as Department of Public Health
Inspector, and LATASHA R. THOMAS, individually
and in her capacity as Alderman of the 17th Ward,
Defendants-Appellees.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 03 C 4341—David H. Coar, Judge.
____________
ARGUED JANUARY 20, 2006—DECIDED MARCH 3, 2006
____________
Before FLAUM, Chief Judge, and BAUER and RIPPLE,
Circuit Judges.
2 No. 05-2059
FLAUM, Chief Judge. The Plaintiffs allege a scheme by
City of Chicago (“City”) officials to close Aida Food and
Liquor and replace it with a retailer such as CVS or
Walgreens. Plaintiffs filed a claim under 42 U.S.C. § 1983,
alleging that various departments of the City wrongfully
inspected Aida Food and Liquor multiple times, interfered
with the store’s liquor license, and refused to sell the vacant
lot next to the business to plaintiff Eassa Fakhoury.
Plaintiffs claim that this conduct violated their Fourteenth
Amendment right to equal protection. The plaintiffs also
argue that their Fourth Amendment rights were violated by
two particular inspections because the investigator did not
have valid consent to search, a search warrant, or probable
cause to search. The district court granted summary
judgment for the defendants. For the following reasons, we
now affirm.
I. Background
Plaintiff Aida Food and Liquor (“Aida”) is a family-run
convenience store located at 7923 S. Halsted St. in Chicago.
It is owned by plaintiff Eassa Fakhoury. In June 2000,
Fakhoury received a letter from the City of Chicago Depart-
ment of Planning and Development, which indicated that
the department intended to take his property by eminent
domain as part of a redevelopment project along 79th
Street. After receiving that letter, Fakhoury heard nothing
more about the matter.
The City conducted inspections of Aida several times
in 2001 and 2002. The City claims that the inspections were
only as frequent as necessary to ensure that public health
standards were met. Plaintiffs claim that these frequent
inspections of both his store and the Chinese restaurant
that was a tenant in his building were an attempt to cause
one or both of the stores to go out of business. This would
force Fakhoury (or his creditors) to sell the property at a
reduced price. Plaintiffs also claim that defendant Chicago
No. 05-2059 3
Alderman Latasha R. Thomas would like the property sold
to Walgreens or CVS, which Fakhoury believes is the
overall goal of the scheme.
The first documented inspections of Aida were con-
ducted by Cecile Coffman, an inspector for the City’s
Department of Public Health. Plaintiffs have shown
evidence that she inspected Aida five times between
January 2001 and December 2002. The inspections occurred
approximately every six months, as required by the Chicago
Municipal Code in § 7-42-010. The record also reflects that
there were follow-up inspections after visits where citations
were issued. Such follow-up inspections are required by the
rules and regulations of the Chicago Board of Health.
In early 2002, the Mayor’s Office requested that the
Department of Buildings conduct an area survey of all
buildings on Halsted Street from 55th to 95th Streets. Aida
was within this survey area. On February 22, 2002, Depart-
ment of Buildings Inspector Kevin Callahan conducted an
inspection of Aida as part of this survey. Inspector Callahan
discovered a number of building code violations and issued
citations. He did not conduct a complete electrical inspec-
tion of the property because he was not an electrician;
however, some of his citations concerned the electrical
conditions inside the store.
The City sued Plaintiffs in state court based on those
citations. On August 16, 2002, an Illinois circuit judge
entered an order requiring Plaintiffs to schedule and be
present for an interior inspection of the premises with the
Department of Buildings. The order also continued the
matter until October 11.1
1
Although Aida claims that the order states that Plaintiffs
were not required to make repairs until October 11, the record
reflects that the order merely continued the matter until October
11. The order is silent as to when repairs must be made.
4 No. 05-2059
On August 22, 2002, Commissioner John Roberson
ordered an electrical inspection at Aida, according to his
deposition, because he had received a citizen complaint
about unsafe electrical conditions in the building.
Donald Gibson, a Department of Buildings Inspector, was
dispatched to Aida, found Fakhoury, and revealed that he
was an inspector for the City. He stated that he wished to
perform an electrical inspection of the store and asked for
permission to do so. According to Fakhoury’s own deposi-
tion, he consented to the search, and asked one of his
employees to take Gibson to the back of the building.
Gibson observed dangerous open electrical boxes, and he
told Fakhoury that the power would need to be shut off.
Inspector Gibson did not have the authority to shut
off the power himself and needed approval from one of
his superiors. Milton Patterson, the Assistant Commis-
sioner of the Department of Buildings, reviewed Gibson’s
report and agreed with Gibson that dangerous conditions
existed at the site. Patterson contacted Commonwealth
Edison (“ComEd”), Aida’s electric company. Patterson asked
ComEd to perform an independent inspection of
the property with Gibson.
On August 28, Gibson returned to Aida, accompanied by
two individuals from ComEd.2 Plaintiffs’ complaint and
Fakhoury and Gibson’s deposition testimony are silent as to
the circumstances surrounding Gibson’s entry into the store
that day. Once Gibson and the two ComEd inspectors were
inside, the ComEd inspectors believed that there
was evidence of theft of electrical service and that
2
Plaintiffs dispute ComEd’s involvement in the second inspec-
tion. As the district court noted, Fakhoury’s own deposition
testimony contradicts the argument. In any event, the issue is
irrelevant to our holding today.
No. 05-2059 5
unsafe conditions existed. The ComEd inspectors turned off
Aida’s power supply.
It is also undisputed that at some point during these
two encounters, Gibson called the police and asked them to
come to the store. Fakhoury, in his deposition, claims that
this occurred on August 28, approximately twenty minutes
after Gibson entered the store. Gibson testified at his
deposition that he contacted the police on August 22 to
ensure that Fakhoury complied with Gibson’s order not to
allow members of the public into the store until the electri-
cal conditions were repaired.
Fakhoury had problems getting the necessary permits
to allow him to repair Aida’s electrical problems. On
September 24, an Illinois circuit judge granted Fakhoury
the right to begin electrical work on his store. The city
never issued an official permit for the work, which Plaintiffs
argue directly violated that order. The record shows that
the order allowed the work to go forward without a permit,
however, and did not require that the City issue one.
Plaintiffs also allege that the City caused Aida’s liquor
license to be revoked. The records of the Mayor’s Licens-
ing Commission indicate that Aida’s liquor license is in good
standing and that the City has not sought revocation.
Plaintiffs claim that the license is listed as “not in good
standing” and Aida must go through additional administra-
tive procedures two times per year to maintain its tempo-
rary liquor license. Plaintiffs concede that Aida’s liquor
sales have continued uninterrupted.
Plaintiffs also allege that they have made attempts to
purchase an empty lot next to Aida, which is owned by
the City, and have not been allowed to do so. Before sell-
ing property to a particular buyer, the City looks to the
alderman of the ward in which the property is located for a
recommendation on which buyer would be most preferable.
Fakhoury contends that he has contacted Alderman Thomas
6 No. 05-2059
about the lot, but the City has not yet sold it to Fakhoury or
anyone else. Fakhoury contends that Alderman Thomas
wishes to sell the property to a large retailer and thus will
not allow him to buy it.
Plaintiffs sued under 42 U.S.C. § 1983 for Fourth Amend-
ment violations, Fifth Amendment procedural due process
violations, and a “class of one” equal protection claim. The
district court granted summary judgment to the defendants.
The court found that the inspections were not outside of the
scope of the statute and were not excessive. The court also
found that because Fakhoury consented to the August 22,
2002, search, no Fourth Amendment violation occurred. The
court ruled against plaintiffs on the procedural due process
claims, pointing out that the plaintiffs could, and did,
receive review of the City’s actions in state court. Finally,
the district court granted summary judgment on the “class
of one” claims, noting that Plaintiffs had not supported
their assertions of animus with any evidence, or shown that
the City had treated similarly situated stores in a different
manner.
Plaintiffs have appealed the summary judgment rul-
ings on the Fourth Amendment claims related to the
inspections on August 22 and 28, 2002, and the equal
protection claims related to the liquor license and the
vacant lot.
II. Discussion
A. Fourth Amendment Claims
Plaintiffs complain that the district court did not properly
address whether Fakhoury’s consent was valid during
Inspector Gibson’s August 22, 2002, inspection, and did not
address the August 28, 2002, inspection at all. The City
argues in response that Fakhoury’s consent for the August
22 search was valid. The City also claims that the plaintiffs
No. 05-2059 7
have waived the argument concerning the August 28
inspection because they did not raise it below. Even if the
issue was not waived, the City contends, Fakhoury con-
sented to the August 28 inspection.
Plaintiffs argue, first, that under the totality of the
circumstances, it was apparent that Gibson was not there
to perform a “legitimate inspection” on August 22; therefore
he exceeded the scope of Fakhoury’s consent, which was
only for a “legitimate inspection.” This argument fails for
several reasons, one of which is that Fakhoury has not
created a genuine issue of fact that Gibson’s inspection was
not “legitimate.”
The City has produced evidence, in the form of Commis-
sioner Roberson’s deposition testimony, that Gibson’s
investigation was the result of a citizen complaint, while
Fakhoury has produced only vague allegations otherwise.
Fakhoury’s only evidence that the search was illegitimate
was his deposition testimony that Gibson stated during
the search that he intended to shut down the store. The
evidence, including Gibson and Fakhoury’s depositions,
shows that Gibson said this after he had observed the
electrical violations. The statement was not a threat—it
was made to inform Fakhoury that his power supply
was about to be terminated. The Plaintiffs’ evidence is
insufficient to support the notion that Gibson’s inspec-
tion was not “legitimate.” The district court was correct
when it ruled that Fakhoury’s consent to inspect on August
22 eliminated any Fourth Amendment claim for that
incident.
Plaintiffs also argue that the district court erred be-
cause its ruling did not address the August 28 inspection. It
is true that the district court did not address the argument,
but we believe that this is because the argument was not
adequately raised before that court. Nowhere in Fakhoury’s
complaint is the August 28 inspection mentioned. Two
8 No. 05-2059
paragraphs in the complaint discuss the August 22 search,
but none refer to Gibson’s follow-up visit on August 28.
Plaintiffs argue that their complaint did address the
August 28 inspection, because the complaint alleged that
“Defendants deprived Plaintiffs of their Fourth Amendment
rights . . . by inspecting their store since the Fall of 2000
and by shutting down the store.” This allegation is too
broad to alert either the district court or the opposing party
to the current claim regarding the August 28 inspection.
Plaintiffs’ reference to “shutting down the store,” is easily
interpreted as referring to the consequence of the electrical
inspection and not the inspection itself. Plaintiffs also argue
that the August 28 search was mentioned in passing in the
plaintiffs’ response to defendants’ motion for summary
judgment. Even assuming that this passing reference plead
the incident with particularity, which it does not, a re-
sponse to summary judgment is hardly a timely filing in
which to raise an issue.
The argument is waived. Appellate courts will not hear
issues that were not clearly raised in the trial courts, so
as to give all litigants the opportunity to develop the
relevant facts during discovery. Boggs v. West, 188 F.3d
1335, 1337-38 (Fed. Cir. 1999). At best, this argument
was raised in so perfunctory a fashion that the district
judge was entitled to disregard it. Nat’l Metalcrafters v.
McNeil, 784 F.2d 817, 825 (7th Cir. 1986). The City was not
given an adequate chance to develop its factual case with
respect to the August 28 inspection. This is evidenced, for
example, in Fakhoury’s deposition, where he was ques-
tioned extensively about the circumstances of Gibson’s entry
to the store on August 22, but was not asked about whether
Fakhoury gave Gibson permission to enter on August 28.
This is an illustration of the reason that claims must be
properly raised in the initial pleadings.
No. 05-2059 9
Plaintiffs also argue that, at the least, the district court
should have allowed them to amend their complaint. We
disagree. Plaintiffs have not shown that they ever moved to
amend the complaint, and we can hardly expect the district
court to grant such leave sua sponte.
B. “Class of one” claim
Plaintiffs also assert a “class of one” claim based on the
frequent inspections of the store, its liquor license status,
and the City’s refusal to sell Fakhoury the empty lot next to
the store. In order to bring a successful claim under this
theory, a plaintiff must show that he or she was (1) inten-
tionally treated differently from others similarly situated
and that there is no rational basis for that treatment, or (2)
that the government is treating similarly situated individu-
als differently because of a “totally illegitimate animus” for
the plaintiff. Nevel v. Vill. of Schaumburg, 297 F.3d 673,
681 (7th Cir. 2002) (citing Albiero v. City of Kankakee, 246
F.3d 927, 932 (7th Cir. 2001)).
Addressing the latter prong first, Plaintiffs have produced
no evidence of animus, save Fakhoury’s deposition testi-
mony that many people in the community have told him
that Alderman Thomas has “ill will” toward himself and his
store. That testimony is inadmissible hearsay insufficient
to create a genuine issue of fact.
“Class of one” claims can also be asserted if a plaintiff
can show that he or she is being treated differently than
those similarly situated. Plaintiffs have shown no evi-
dence that they are treated differently than any other
establishment. The only evidence produced demonstrates
lawful inspections that adhere to the City’s regulations. The
City has not sold the vacant lot to anyone, so clearly no
other potential buyer has been treated more favorably than
the plaintiffs. And even assuming, arguendo, that Aida’s
liquor license has been listed as “not in good standing,” the
10 No. 05-2059
plaintiff has made no showing that the City has actually
prevented him from selling liquor. The district court
properly dismissed Plaintiffs’ class of one claim.
III. Conclusion
For the foregoing reasons, the judgment of the district
court is AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—3-3-06