Establishment Has A Property Interest In Liquor License Actually Issued

PRO'S SPORTS BAR & GRILL v. CITY OF COUNTRY CLUB HILLS (December 16, 2009)

Pro's Sports Bar & Grill is located in Country Club Hills, Illinois. Pro's submitted an application for a liquor license. Pursuant to local procedure, the City Council considered an ordinance on November 26, 2007 for the granting of that license. There is significant dispute about what happened at the council meeting. At a minimum, there is confusion about the formalities undertaken. There certainly was discussion about granting a license with limited hours. In any event, at the end of the meeting, an ordinance granting the license was approved. A Class A license with regular hours was issued. Shortly thereafter, however, the license was reissued as a Class A-1 license (a category of license not even defined in the municipal code). The local police began enforcing the license as if it had the limited hours which were discussed in the earlier council meeting. In 2008, when Pro's applied for a reissuance of the license, it was issued with limited hours, even though the normal practice is to be issued a license on its original terms and conditions. Pro's filed suit pursuant to § 1983, alleging a violation of its procedural due process rights. The court granted a preliminary injunction prohibiting the enforcement of the limited hours. The City of Country Club Hills appeals.

In their opinion, Judges Flaum, Manion and Wood affirmed. The Court started with its two-part test for approaching a procedural due process claim. It first identifies whether there is a protected liberty or property interest and then asks whether a party was deprived of its interest without due process. The principal issue in dispute was whether the original license contained the limited hours. If it did, the renewal did not result in any deprivation. If it did not, the renewal restrictions would have resulted in a deprivation. The bare language of the original ordinance granted an unrestricted license. The Court found the language of the ordinance unambiguous and rejected the defendants' argument that it should be interpreted otherwise because of either the intent of the City Council or because it was a scrivener's error. Having found a deprivation of the property interest, there was little dispute about the City's failure to provide adequate process -- since it provided none. Finally, the Court found no error in the lower court's balancing of the preliminary injunction factors.
 

Court Considers Effect Of Permitted And Non-Permitted Uses On Government Goals In Considering RLUIPA Violation

RIVER OF LIFE KINGDOM MINISTRIES v. HAZEL CREST (October 27, 2009)

River of Life Kingdom Ministries ("Ministries") is a small religious organization that does not occupy its own facility. Instead, it shares space with two other religious organizations in a dirty warehouse. The Ministries decided to purchase a new facility where it could better promote its community goals. It purchased property in Hazel Crest, even though the village had zoned the area for economic redevelopment. The ordinances allowed general commercial and retail uses but did not allow religious services. After its application for a special-use exception was denied, the Ministries filed a complaint and motions for a temporary restraining order and preliminary injunction. The complaint alleged that the ordinance violated the Equal Terms provision of the Religious Land Use and Institutionalized Persons Act ("RLUIPA"). While the motion for a preliminary injunction was pending, the village amended the ordinance to exclude meeting halls, public schools, community centers and other uses in an effort to ensure the ordinance's compliance with RLUIPA. The court denied the preliminary injunction. The Ministries appeal.

In their opinion, Judges Cudahy, Manion and Williams affirmed. The Court first stated the burden for obtaining a primary injunction: a reasonable likelihood of success on the merits, irreparable harm and a balancing of the harms based on the likelihood of success. With respect to its likelihood of success on the merits, the Court concluded that the Ministries was unlikely to succeed. The Equal Terms provision of the Act prohibits land-use regulations that treat religious assemblies on "less than equal terms" with non-religious assemblies. The Court discussed and critiqued the approaches of the Eleventh and Third Circuits. The Court preferred the Third Circuit approach, which allows a court to compare the effects of the allowed and disallowed uses on the local government's goals. Here, Hazel Crest's goal was to create a tax-generating commercial district. All of the "assemblies" that were allowed by the ordinance were commercial ventures. The Court concluded that the village's exclusion of non-commercial uses, including religious assemblies, was not likely to violate the RLUIPA. Although the Court then concluded that the relocation was instrumental to the Ministries' mission and could be considered irreparable harm, it did not believe that that harm significantly outweighed the harm to Hazel Crest.

Railway Labor Act Suit Is Timely When It Alleges Conduct That Began More Than Six Months Before Filing But Which Continued To Occur And Continued To Cause New Harm

UNITED AIR LINES, INC. v. AIR LINE PILOTS ASSOCIATION (March 9, 2009)

United Air Lines, Inc. ("United") and the Air Line Pilots Association ("ALPA"), the collective bargaining representative for the pilots, have a long and contentious history of labor negotiations. The events of September 11, 2001 put additional pressure on that relationship. Their current collective bargaining agreement was negotiated in 2003 and amended in 2004 and 2005. In late 2006, ALPA attempted to reopen contract negotiations. According to United, ALPA took a number of coordinated measures in an attempt to pressure United. United sued ALPA in July of 2008 under Section 2, First of the Railway Labor Act (“RLA”). Shortly thereafter, ALPA agreed to direct its members not to engage in the disruptive activities. The district court, after an evidentiary hearing, granted United's request for a preliminary injunction. ALPA appeals.

In their opinion, Judges Rovner, Wood and Sykes affirmed. The Court addressed the four main issues on appeal: a) that the claim was barred by the six-month statute of limitations, b) that ALPA had made reasonable efforts under the RLA, c) that United failed to satisfy the requirements of Section 6 of the Norris-LaGuardia Act ("NLGA"), and d) that United failed to satisfy the requirements of Section 7 of the NLGA. With respect to the statute of limitations, the Court noted that the RLA borrows the six-month statute of limitations from the National Labor Relations Act. Although the court agreed that the conduct of ALPA began long before the suit was filed, it concluded that the action was not time-barred. ALPA engaged in unlawful action both before and during the six-month period and their actions created new injuries within the six-month period. The Court found no merit in ALPA'S argument that it made reasonable efforts to halt its members’ unlawful conduct. It relied on the district court's thorough findings of fact and accorded them substantial deference. With respect to the Section 6 requirement -- that United is required to prove that ALPA participated in or ratified the unlawful conduct -- the Court again relied heavily on the thorough findings of fact by the district court. It concluded that United’s statistical evidence, in combination with ALPA's coded communications, were sufficient to meet its burden. Finally, the Court rejected ALPA’s argument that the injunction was not necessary to prevent a violation of Section 2, First of the RLA. The Court conceded the general prohibition in the NLGA barring injunctions against labor unions, but noted an exception when there is a specific violation of a provision of the RLA. Even though ALPA had entered into an agreement to voluntarily cease its wrongful conduct, the district court found that it's conduct was inconsistent with its agreement. The Court concluded that the lower court was within its discretion to find that an injunction was the only way to ensure compliance with the RLA.

Local Girl Scout Council is a "Dealer" Under the Wisconsin Fair Dealership Law and Entitled to Presumption of Irreparable Harm

GIRL SCOUTS OF MANITOU COUNCIL v. GIRL SCOUTS OF THE UNITED STATES OF AMERICA (December 15, 2008)

Juliette Low founded the Girl Scouts of the United States of America (“GSUSA”) in 1912. GSUSA is run by a national council and its board of directors. In its almost 100 years of existence, GSUSA has developed a large network of local girl scout councils. GSUSA first chartered Girl Scouts of Manitou (“Manitou”) as a council in 1950. As of 2005, there were over 300 local councils. Each council has a charter issued by GSUSA that defines the relationship between the two and grants the council the right to maintain scouting throughout its jurisdiction. In 2005, GSUSA announced a plan to consolidate councils. It planned to reduce the number of councils to just over one hundred. Each council would be larger and, GSUSA hoped, more efficient. The plan would have required Manitou to merge 60% of its territory with six other nearby councils and cede 40% of its territory to two other councils. Manitou decided not to go along. It filed suit in February 2008 against GSUSA. It alleged breach of contract, tortious interference and a violation of the Wisconsin Fair Dealership Law. It sought to permanently enjoin GSUSA from altering its territory. The district court denied Manitou’s request for a preliminary injunction without a hearing. The court held that Manitou had failed to demonstrate that it would suffer irreparable harm in the absence of the injunction. Manitou appeals.

In their opinion, Judges Posner, Kanne and Tinder reversed and entered the requested order enjoining GSUSA. The Court led off with the familiar two-phase test for a preliminary injunction. A movant must demonstrate: a) irreparable harm, b) inadequate legal remedy, and c) a likelihood of success. The movant who succeeds in that first phase enters a second phase in which the court balances the injury to the plaintiff, its likelihood of success, the possible injury to the defendant if the injunction issues, and the public interest. The court uses a balancing test in which the greater the plaintiff’s likelihood of success, the less the balance of harm needs to be in its favor. Applying that test, the Court first addressed irreparable harm, the only of the first-phase factors addressed by the district court. The Court disagreed with the court below. It found that Manitou’s loss of jurisdiction would severely affect its ability to generate revenue and harm its goodwill. That harm would not be rectified if a final judgment were entered in its favor and the loss of jurisdiction reversed. The Court also disagreed with the court below on the application of the Wisconsin Fair Dealership Law, under which a “dealer” in Manitou’s circumstances enjoys a statutory presumption of irreparable harm. The Court found that Manitou fit within the statutory definition of “dealer” in the act.

Having found that Manitou established irreparable harm and also noting that the record contained sufficient information to address the rest of the two-phase analysis without remand, the Court proceeded to do so. The Court found that the timing of and difficulty in calculating a damages award established that Manitou’s legal remedies were inadequate. On the likelihood of success factor, the Court noted that it only had to find a “better than negligible” chance of success to satisfy this prong. The Court evaluated only the Wisconsin Fair Dealership Law claim and found that Manitou satisfied that minimal standard.

In addressing the balancing portion of the test, the Court found a “drastic imbalance” in favor of Manitou. The Court noted that the national GSUSA program to consolidate regions was not even scheduled to be completed for a year. Any delay in the Wisconsin part of that plan would not lead to any harm to GSUSA. In addition, any harm to GSUSA could be rectified later. The Court did not feel the need to conduct a deeper analysis of Manitou’s likelihood to succeed given the imbalance of the harm.

Sierra Club Has Standing to Challenge Construction of Power Plant - Construction Enjoined

SIERRA CLUB V. FRANKLIN COUNTY POWER (October 27, 2008)

In August of 2000, Franklin County Power of Illinois (“FCPI”) applied to the Illinois EPA (“IEPA”) for a Prevention of Significant Deterioration permit in order to construct a power plant. The IEPA issued the permit on July 3, 2001. The permit provided that it would become invalid if FCPI: a) did not begin construction of the plant’s boilers within eighteen months, or b) discontinued construction for eighteen months, or c) failed to complete construction within a reasonable time. On December 2, 2002, FCPI contracted with an engineering and construction company to work with it exclusively to negotiate a construction contract. On December 18, FCPI arranged for excavation to begin. Excavation equipment was delivered to the site on January 3, 2003. Although the contractor began the excavation on January 8, it terminated its work in February because of a dispute. The landlord filled in the excavation in July. FCPI began the excavation anew in September of 2004. Shortly afterward, the IEPA determined that construction had commenced. In November, the IEPA made a preliminary determination that the permit had expired. The determination was appealed and the appeal is still pending. In May of 2005, the Sierra Club filed suit under the citizen suit provision of the Clean Air Act (“CAA”). FCPI moved to dismiss and for summary judgment on the grounds that the permit was valid and that Sierra Club lacked standing. The district court denied the motion. Instead, it entered summary judgment for Sierra Club and permanently enjoined FCPI from building the power plant until it obtained a permit.

In their opinion, Judges Bauer, Ripple, and Williams affirmed. The Court first addressed Sierra Club’s standing. An organization has standing only if: a) one of its members has standing, b) the interests at stake in the litigation are germane to the organization’s purpose, and c) an individual’s participation is not required. FCPI challenged only the first prong. Sierra Club relied on its member Barbara McKasson. In order to prevail on summary judgment, Sierra Club had to submit evidence to establish that: a) she suffered an actual or imminent, concrete injury, b) the injury is traceable to the actions complained of, and c) a favorable decision would likely redress the injury. McKasson stated that she and her family have regularly traveled to within three miles of the proposed plant site and there engaged in such activities as camping, fishing, and kayaking. The Court found that Sierra Club satisfied the individual standing test: a) McKasson will either be exposed to pollutants if she continues her trips or will have to forego the trips, either of which is sufficient injury, b) the injury is actual even though the plant is not yet built, c) the injury is traceable to the plant, even if the plant reduces its emissions, and d) an injunction will redress the harm for some period of time, even if FCPI eventually obtains a new permit.

The Court next addressed FCPI’s claim that Sierra Club’s action is not ripe until IEPA issues a decision on the permit appeal. The Court said that the plain language of the CAA allows a citizen suit against a person who is alleged to be in violation of a permit or who proposes to construct without a permit. The Court found that FCPI was either in violation of the permit because it failed to commence construction in time or, if the expired permit is akin to no permit, it is proposing to build one without one. Either way, the Court found that the suit was proper under the CAA.

On the issue of whether FCPI “commenced” construction, the Court stated that FCPI could commence construction in either of two ways.  It could begin “ a continuous program of physical on-site construction” or it could enter into binding contracts to complete construction within a reasonable tim.  To qualify, the contracts could not be canceled without a substantial penalty.  FCPI argued that there were genuine issues of fact regarding this test, precluding summary judgment. The Court had little trouble concluding that FCPI could not meet the continuous construction test. The only work it did was to excavate a hole. Even that was not permanent, since it was later filled in. The Court also found that FCPI lapsed in its construction activities for over eighteen months, even if it did begin on time. The Court also rejected FCPI’s argument that it’s binding contract meant that it had “commenced construction.” The contract was merely an agreement to negotiate in good faith in an attempt to reach an agreement on a construction contract. The fact that it contained a penalty clause was not enough to make it a qualifying contract.

Finally, FCPI argued that the district court had no authority to enter an injunction or, in the alternative, that it erred in not applying the traditional four-part analysis for injunctive relief. The Court relied on the plain language of the CAA to reject FCPI’s lack of authority argument. Although the Court was a little more troubled by the second argument, it also resolved it in Sierra Club’s favor. It first found that the lower court’s merits decision that FCPI did not have a valid permit accomplished essentially the same thing as an injunction - it required FCPI to get a permit. The Court’s also conducted its own analysis of the four factors and found that they favored Sierra Club. 

"Clear Hostility" Toward Union Leads to Entry of Preliminary Injunction; Broad Injunction Limited to Violations Similar to Those Already Committed is Acceptable

LINEBACK v. SPURLINO MATERIALS  (October 8, 2008)

Spurlino Materials (“Spurlino”) produces and sells concrete. In 2005, several employees began a union representation effort. Spurlino management allegedly campaigned heavily against the union. Notwithstanding those efforts, the company employees voted to be represented by the union. The NLRB certified the union and it began negotiating its first contract with Spurlino in early 2006. The parties continued to negotiate through early 2007, but were unable to agree on contract terms (and apparently still have not). Attendance at union meetings declined during this period, possibly because of fears of retaliation by Spurlino. Spurlino management allegedly continued an intense harassment campaign against the union.

Spurlino historically used a seniority-based dispatch procedure. Spurlino sent out each of its drivers in order of seniority until each had been given one assignment. The rest of the assignments for each day were dispatched in order of each driver’s return from his or her original assignment.  In December of 2005, Spurlino was awarded a large contract to provide concrete for the construction of a new football stadium for the Indianapolis Colts. A separate labor agreement covered the stadium project. Stadium contractors paid higher wages under the separate agreement than Spurlino normally paid its employees. Thus, Spurlino drivers preferred the stadium work over other Spurlino assignments. The union alleges that Spurlino used the opportunities provided by the stadium contract to retaliate and discriminate against the leaders of the union movement. It claims that Spurlino a) manipulated the seniority dispatch system to keep the union leaders from the preferred jobs at the stadium, b) changed the way work was assigned when it built a temporary, portable plant, and c) instituted a thirteen-factor performance review to discriminate against union leaders. In August of 2006, the union filed a series of unfair labor practice charges against Spurlino. They were consolidated into an NLRB complaint that alleged that Spurlino: a) discriminated against union leaders because of their activities, b) changed pre-existing work assignment policies without negotiation, and c) implemented an evaluation procedure without negotiation. The ALJ commenced a hearing. During a hearing recess, in May of 2007, the NLRB requested injunctive relief from the district court pending a final Board decision. In June, the court entered an order enjoining Spurlino from a) retaliating against union members, b) acting unilaterally to change the terms and conditions of employment, c) refusing to bargain in good faith, and d) interfering with employees’ exercise of their rights. Spurlino appeals. Shortly after Spurlino’s appeal, the ALJ issued its order. It concluded that Spurlino had discriminated against union leaders and had unilaterally changed the terms and conditions of employment. That order is on appeal before the NLRB.

In their opinion, Judges Bauer, Ripple, and Manion (concurring) affirmed. The Court noted that the National Labor Relations Act authorizes injunctive relief, pending resolution of an NLRB claim, in “just and proper” circumstances. The factors are the same as those that apply to injunctive relief in other contexts: a) no adequate remedy at law, b) irreparable harm that outweighs harm to the employer, c) the public interest, and d) likelihood of success on the merits. The Court addressed each in turn. NLRB proceedings are frequently slow, potentially allowing time for employers to “chill” union activities. Especially in the case of new union representation, there is a risk that no remedy at law will adequately address the harm. On the issue of irreparable harm, the lower court had clear evidence of Spurlino’s hostility toward the union and continued discrimination toward the union and its leaders. The public interest was served by an order prohibiting an unfair labor practice. The district court had found “strong showings” of likelihood of success on the discrimination and unilateral changes in the terms of employment charges and “at least a substantial showing” on the good faith bargaining charge. The Court concluded that the district court considered the right factors and it found no error in its evaluation of them. It did not abuse its discretion.

The Court next addressed the scope of the injunction entered by the district court. Spurlino argued that each of the four paragraphs of the injunction was overbroad. The Court addressed each paragraph in turn under the FRCP 65(d) requirement that injunctions be specific and “describe in reasonable detail” the acts enjoined. The Court also noted that a court may enjoin acts a) which are similar to acts it has found to be unlawful and b) whose commission, if not enjoined, can fairly be anticipated from the defendant’s past conduct. Spurlino argued that paragraphs 1 and 2 were overbroad. Paragraph 1 enjoins retaliation against “all” union members, even though the complaint alleges retaliation against a few named leaders. Paragraph 2 enjoins “all” unilateral actions to change terms and conditions of employment, though the complaint’s allegations were less broad. The Court relied on the district court’s finding of a “continuous and deliberate” effort by Spurlino to undermine the union in holding that these paragraphs were not overbroad. Paragraph 3 enjoins Spurlino from refusing to bargain in good faith. The complaint’s allegation of refusal to bargain was limited to the portable plant. The Court also upheld this paragraph, relying on the district court’s finding that Spurlino engaged in a pattern of refusals to bargain and that further refusals were likely to occur, if not enjoined. Paragraph 4 of the injunction broadly enjoined Spurlino from “in any like manner interfering with, restraining, or coercing employees’ exercise of their rights.” The Court observed that the provision was similar to a provision struck by the Supreme Court in NLRB v. Express Pub. Co.. However, it relied on the addition of the word “like,” not present in the Express injunction, to uphold the paragraph as within the power of the court to enjoin related unlawful acts.

Judge Manion concurred. He wrote separately to emphasize that the injunction against refusing to bargain in good faith does not enjoin “any” refusals to bargain. It only enjoins refusals that are similar to the refusals alleged by the NLRB and found by the district court.