This case was last updated from Los Angeles County Superior Courts on 06/23/2022 at 23:24:01 (UTC).

CITY OF BURBANK, A MUNICIPAL CORPORATION, ET AL. VS BARFLY, INC., A CALIFORNIA CORPORATION, ET AL.

Case Summary

On 03/01/2021 CITY OF BURBANK, A MUNICIPAL CORPORATION, filed an Other lawsuit against BARFLY, INC , A CALIFORNIA CORPORATION,. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The Judges overseeing this case are JAMES C. CHALFANT, MITCHELL L. BECKLOFF, BARBARA M. SCHEPER and ARMEN TAMZARIAN. The case status is Pending - Other Pending.
Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    *******7923

  • Filing Date:

    03/01/2021

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Other

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judges

JAMES C. CHALFANT

MITCHELL L. BECKLOFF

BARBARA M. SCHEPER

ARMEN TAMZARIAN

 

Party Details

Cross Defendants and Plaintiffs

CITY OF BURBANK A MUNICIPAL CORPORATION

THE PEOPLE OF THE STATE OF CALIFORNIA BY AND THROUGH AMELIA ANN ALBANO CITY ATTORNEY FOR THE CITY OF BURBANK

ALBANO AMELIA ANN

Defendants and Cross Plaintiffs

LEPEJIAN LUCAS

LEPEJIAN TALYA

BARFLY INC. A CALIFORNIA CORPORATION

LEPEJIAN ISABELLE

LEPEJIAN BARET

Attorney/Law Firm Details

Plaintiff Attorneys

LEE MICHAEL

VANDERBORGHT JILL ALICIA

Cross Plaintiff Attorney

GERAGOS MARK JOHN

Cross Defendant Attorneys

ALBANO AMELIA ANN

CLARK ASHLEE PARKER

MCEWEN STEPHEN ANTHONY

 

Court Documents

Notice Re: Continuance of Hearing and Order

6/20/2022: Notice Re: Continuance of Hearing and Order

Request for Dismissal

6/22/2022: Request for Dismissal

Answer - ANSWER TO THIRD AMENDED CROSS-COMPLAINT

6/23/2022: Answer - ANSWER TO THIRD AMENDED CROSS-COMPLAINT

Unknown - THIRD AMENDED CROSS-COMPLAINT

5/23/2022: Unknown - THIRD AMENDED CROSS-COMPLAINT

Order - ORDER REGARDING CROSS-DEFENDANTS DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

5/3/2022: Order - ORDER REGARDING CROSS-DEFENDANTS DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITHOUT MOTION TO STRIKE)

5/3/2022: Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITHOUT MOTION TO STRIKE)

Request for Judicial Notice - REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF OPPOSITION TO CROSS-DEFENDANTS DEMURRER TO SECOND AMENDED CROSS- COMPLAINT

4/20/2022: Request for Judicial Notice - REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF OPPOSITION TO CROSS-DEFENDANTS DEMURRER TO SECOND AMENDED CROSS- COMPLAINT

Opposition - OPPOSITION TO CROSS-DEFENDANTS' DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

4/20/2022: Opposition - OPPOSITION TO CROSS-DEFENDANTS' DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

Reply - REPLY PLAINTIFFSCROSS-DEFENDANTS REPLY TO OPPOSITION TO DEMURRER TO SECOND AMENDED CROSS-COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF

4/26/2022: Reply - REPLY PLAINTIFFSCROSS-DEFENDANTS REPLY TO OPPOSITION TO DEMURRER TO SECOND AMENDED CROSS-COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF

Declaration - DECLARATION OF ASHLEE P. CLARK REGARDING MEET AND CONFER ON DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

4/1/2022: Declaration - DECLARATION OF ASHLEE P. CLARK REGARDING MEET AND CONFER ON DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

Demurrer - without Motion to Strike

4/1/2022: Demurrer - without Motion to Strike

Request for Judicial Notice

4/1/2022: Request for Judicial Notice

Unknown - DECLARATION OF DEMURRING PARTY IN SUPPORT OF AUTOMATIC EXTENSION

3/2/2022: Unknown - DECLARATION OF DEMURRING PARTY IN SUPPORT OF AUTOMATIC EXTENSION

Unknown - AMENDED CROSS-COMPLAINT (2ND)

2/1/2022: Unknown - AMENDED CROSS-COMPLAINT (2ND)

Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITHOUT MOTION TO STRIKE; CASE MANAGEME...)

1/11/2022: Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITHOUT MOTION TO STRIKE; CASE MANAGEME...)

Certificate of Mailing for - CERTIFICATE OF MAILING FOR (RULING ON SUBMITTED MATTER) OF 01/12/2022, ORDER REGARDING CROSS-DEFENDANTS DEMURRER

1/12/2022: Certificate of Mailing for - CERTIFICATE OF MAILING FOR (RULING ON SUBMITTED MATTER) OF 01/12/2022, ORDER REGARDING CROSS-DEFENDANTS DEMURRER

Minute Order - MINUTE ORDER (RULING ON SUBMITTED MATTER)

1/12/2022: Minute Order - MINUTE ORDER (RULING ON SUBMITTED MATTER)

Order - ORDER REGARDING CROSS-DEFENDANTS DEMURRER

1/12/2022: Order - ORDER REGARDING CROSS-DEFENDANTS DEMURRER

139 More Documents Available

 

Docket Entries

  • 08/09/2022
  • Hearing08/09/2022 at 09:00 AM in Department 52 at 111 North Hill Street, Los Angeles, CA 90012; Case Management Conference

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  • 06/20/2022
  • DocketNotice Re: Continuance of Hearing and Order; Filed by Clerk

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  • 05/23/2022
  • DocketThird Amended Cross-Complaint; Filed by Baret Lepejian (Cross-Complainant); Lucas Lepejian (Cross-Complainant); Barfly, Inc., a California Corporation (Cross-Complainant) et al.

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  • 05/03/2022
  • Docketat 09:00 AM in Department 52, Armen Tamzarian, Presiding; Hearing on Demurrer - without Motion to Strike - Held - Motion Granted

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  • 05/03/2022
  • DocketMinute Order ( (Hearing on Demurrer - without Motion to Strike)); Filed by Clerk

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  • 05/03/2022
  • DocketOrder Regarding Cross-Defendants? Demurrer to Second Amended Cross-Complaint; Filed by Clerk

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  • 04/26/2022
  • DocketReply (PLAINTIFFSCROSS-DEFENDANTS REPLY TO OPPOSITION TO DEMURRER TO SECOND AMENDED CROSS-COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF); Filed by City of Burbank, a municipal corporation (Cross-Defendant); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Cross-Defendant)

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  • 04/20/2022
  • DocketOpposition (to Cross-Defendants' Demurrer to Second Amended Cross-Complaint); Filed by Barfly, Inc., a California Corporation (Cross-Complainant)

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  • 04/20/2022
  • DocketRequest for Judicial Notice (IN SUPPORT OF OPPOSITION TO CROSS-DEFENDANTS? DEMURRER TO SECOND AMENDED CROSS- COMPLAINT); Filed by Barfly, Inc., a California Corporation (Cross-Complainant)

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  • 04/14/2022
  • Docketat 09:00 AM in Department 52; Hearing on Demurrer - without Motion to Strike - Not Held - Rescheduled by Party

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161 More Docket Entries
  • 03/03/2021
  • DocketDeclaration in Support of Ex Parte Application; Filed by City of Burbank, a municipal corporation (Plaintiff); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Plaintiff)

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  • 03/03/2021
  • DocketChallenge To Judicial Officer - Peremptory (170.6); Filed by City of Burbank, a municipal corporation (Plaintiff)

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  • 03/03/2021
  • DocketMinute Order ( (Court Order)); Filed by Clerk

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  • 03/03/2021
  • DocketCertificate of Mailing for ((Court Order) of 03/03/2021); Filed by Clerk

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  • 03/03/2021
  • DocketEx Parte Application (PLAINTIFFS? EX PARTE APPLICATION FOR TEMPORARY RESTRAINING ORDER AND ORDER TO SHOW CAUSE RE PRELIMINARY INJUNCTION; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF); Filed by City of Burbank, a municipal corporation (Plaintiff); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Plaintiff)

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  • 03/03/2021
  • DocketDeclaration in Support of Ex Parte Application; Filed by City of Burbank, a municipal corporation (Plaintiff); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Plaintiff)

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  • 03/01/2021
  • DocketComplaint; Filed by City of Burbank, a municipal corporation (Plaintiff); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Plaintiff)

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  • 03/01/2021
  • DocketNotice of Case Assignment - Unlimited Civil Case; Filed by Clerk

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  • 03/01/2021
  • DocketCivil Case Cover Sheet; Filed by City of Burbank, a municipal corporation (Plaintiff); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Plaintiff)

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  • 03/01/2021
  • DocketSummons (on Complaint); Filed by City of Burbank, a municipal corporation (Plaintiff); The People of the State of California, by and through Amelia Ann Albano, City Attorney for the City of Burbank (Plaintiff)

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Tentative Rulings

Case Number: *******7923 Hearing Date: August 22, 2022 Dept: 52

Tentative Rulings:

Plaintiffs/Cross-Defendants City of Burbank and the People of the State of California’s Motion for Judgment on the Pleadings

Requests for Judicial Notice

Plaintiffs/cross-defendants City of Burbank and the People of the State of California, by and through Joseph H. McDougall, City Attorney for the City of Burbank, make 27 requests for judicial notice with their moving papers and three additional requests with their reply.

Though the records are subject to judicial notice under Evidence Code section 452(c) as official acts of the government or under section 452(d)(1) as court records, none of the records are relevant or necessary to the court’s analysis. (See Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 748, fn. 6; Appel v. Superior Court (2013) 214 Cal.App.4th 329, 342, fn. 6.)

All requests for judicial notice are denied.

Judgment on the Pleadings

Plaintiffs/cross-defendants City of Burbank and the People of the State of California, by and through Joseph H. McDougall, City Attorney for the City of Burbank, move for judgment on the pleadings on the third amended cross-complaint of cross-complainants Barfly, Inc., Baret Lepejian, Lucas Lepejian, and Tayla Lepejian.

Cross-complainants requested dismissal of several causes of action in the third amended cross-complaint. The sole remaining cause of action is the third cause of action for violation of the First Amendment freedom of assembly clause. (TACC, pp. 18-20.)

Procedural Defect

This motion is procedurally defective. Ordinarily, a party cannot move for judgment on the pleadings on the same grounds as its prior unsuccessful demurrer. (CCP 438(g)(1).) A party can only do so “provided that there has been a material change in applicable case law or statute since the ruling on the demurrer.” (Ibid.)

Cross-defendants already demurred on the same basis for which they now move for judgment on the pleadings. On April 1, 2022, cross-defendants demurred to the second amended cross-complaint, including a general demurrer to the fifth cause of action for violation of the First Amendment’s freedom of assembly clause. On May 3, 2022, the court found that the second amended cross-complaint alleged sufficient facts for that cause of action and overruled the demurrer to the fifth cause of action.

Cross-defendants now demur to the same cause of action, which is the third cause of action in the third amended cross-complaint, on the same grounds. They do not assert or show any material change in applicable case law or statute since the court’s ruling on the demurrer on May 3, 2022. Cross-complainants’ opposition raised this issue, but cross-defendants’ reply did not address it.

Substantive Analysis

The motion for judgment on the pleadings also fails on the merits. The third amended cross-complaint alleges sufficient facts for its third cause of action for violation of the First Amendment’s freedom of assembly clause.

A plaintiff may bring a Section 1983 claim alleging that public officials, acting in their official capacity, took action with the intent to retaliate against, obstruct, or chill the plaintiff’s First Amendment rights. [Citation.] To bring a First Amendment retaliation claim, the plaintiff must allege that (1) it engaged in constitutionally protected activity; (2) the defendant’s actions would “chill a person of ordinary firmness” from continuing to engage in the protected activity; and (3) the protected activity was a substantial motivating factor in the defendant’s conduct—i.e., that there was a nexus between the defendant’s actions and an intent to chill speech. [Citations.] Further, to prevail on such a claim, a plaintiff need only show that the defendant “intended to interfere” with the plaintiff’s First Amendment rights and that it suffered some injury as a result; the plaintiff is not required to demonstrate that its speech was actually suppressed or inhibited.

(Arizona Students’ Association v. Arizona Board of Regents (9th Cir. 2016) 824 F.3d 858, 867.)

Cross-complainants allege each element. First, they allege, “In an exercise of its First Amendment right to freedom of speech and assembly, Barfly publicly expressed its political views opposing the shutdown orders.” (TACC, 21.) Publicly expressing political views is constitutionally protected activity.

Second, cross-complainants allege the City took actions that would chill a person of ordinary firmness from continuing to engage in protected activity. They allege the City revoked Barfly’s CUP (TACC, 33-36), “shut off the restaurant’s power” (TACC, 42), and “block[ed] off the restaurant” by building a wall around it (TACC, 50-51). Shutting down one’s business would chill a person of ordinary fitness from continuing to speak.

Third, cross-complainants allege the City acted with intent to chill their speech. They allege, “The City, by and through its health officer and agents, arbitrarily enforced the very same COVID-19 shutdown orders they publically opposed using its Burbank Municipal Code specifically against Barfly, but not other similarly situated restaurants. Upon information and belief, the City issued Barfly citations for remaining open—while allowing other restaurants to conduct the same services without penalty—because the City’s underlying intent was to silence and punish Barfly for expressing its beliefs.” (TACC, 22.)

They further allege “the City intentionally tarnished Tin Horn’s reputation in the community, labeling Barfly’s restaurant as a threat to the public, in retaliation against Barfly’s public opposition to the shutdown orders.” (TACC, 26.) Finally, they allege the City “singled out Barfly for strict enforcement of the COVID-19 shutdown orders through the Burbank Municipal Code because the City’s underlying intent was to silence and punish Barfly for expressing its beliefs.” (TACC, 57.)

Cross-defendants rely on Nieves v. Bartlett (2019) 139 S.Ct. 1715 for the proposition that a First Amendment retaliation claim fails where the government had probable cause for its actions. There, the plaintiff alleged he was arrested in retaliation for protected speech. (Id. at p. 1723.) The Supreme Court held, “The plaintiff pressing a retaliatory arrest claim must plead and prove the absence of probable cause for the arrest” (id. at p. 1724), with one exception. “[T]he no-probable-cause requirement should not apply when a plaintiff presents objective evidence that he was arrested when otherwise similarly situated individuals not engaged in the same sort of protected speech had not been.” (Id. at p. 1727.)

Assuming Nieves v. Bartlett applies to retaliation claims based on government acts other than arrest, cross-complainants allege sufficient facts to invoke the exception. The third amended cross-complaint alleges the City enforced the COVID rules “specifically against Barfly, but not other similarly situated restaurants” and “issued Barfly citations for remaining open—while allowing other restaurants to conduct the same services without penalty.” (TACC, 22)

Cross-defendants argue this allegation is conclusory and therefore insufficient. “The plaintiff is required to plead only ultimate facts, not evidentiary facts.” (C. W. Johnson & Sons, Inc. v. Carpenter (2020) 53 Cal.App.5th 165, 169.) Evidentiary facts would include, for example, which other restaurants were similarly situated but not cited for violating the same rules. The cross-complainants do not have to allege such details in their pleadings.

The allegation that the City enforced rules against Barfly but not other similarly situated restaurants is a sufficient allegation of ultimate fact. If true, that allegation can be proven by objective evidence. Whether that allegation of objective fact is true cannot be resolved on the pleadings.

Cross-defendants’ reliance on Stewart v. Justice (S.D.W. Va. 2021) 518 F.Supp.3d 911 is misplaced. There, a United States District Court granted a motion to dismiss a First Amendment retaliation claim based on similar facts. That case, however, was decided under the Federal Rules of Civil Procedure, which have a higher standard of pleading: “a complaint must contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face.” (Id. at p. 915, internal quotes omitted, italics added.) The court reasoned, “Plaintiffs insist that dismissal is precluded by their allegation that [defendant’s] sole motivating factor was the [protected activity]. However, courts need not accept allegations that are not plausible.” (Stewart, supra, 518 F.Supp.3d at p. 921.)

California civil procedure has no such plausibility requirement for complaints. The court must accept factual allegations as true regardless of whether the court finds them plausible. (Hacker v. Homeward Residential, Inc. (2018) 26 Cal.App.5th 270, 280 [on demurrer, “the facts alleged in the pleading are deemed to be true, however improbable they may be”].)

Disposition

The motion is denied.



Case Number: *******7923 Hearing Date: May 3, 2022 Dept: 52

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

City of Burbank, a municipal corporation, et al.

Plaintiffs,

v.

Barfly, Inc., a California corporation, et al.

Defendants.

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Case No. *******7923

ORDER REGARDING CROSS-DEFENDANTS’ DEMURRER TO SECOND AMENDED CROSS-COMPLAINT

Hearing: May 3, 2022

Barfly, Inc., a California corporation, et al.

Cross-Complainants,

v.

City of Burbank, a municipal corporation, et al.

Cross-Defendants.

)

)

)

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Plaintiffs/cross-defendants City of Burbank (City) and the People of the State of California, by and through City Attorney Joseph H. McDougall, generally demur to the second amended cross-complaint (SACC) filed by cross-complainants Barfly, Inc. (Barfly), Baret Lepejian, Lucas Lepejian, and Tayla Lepejian.

Barfly operates a restaurant known as Tin Horn Flats Saloon & Grill in Burbank. Baret, Lucas, and Tayla Lepejian are agents of Barfly. Operating the restaurant requires a conditional use permit issued by the City.

On December 12, 2020, the City suspended Barfly’s conditional use permit (CUP) for allowing outdoor dining in violation of the County of Los Angeles’s order closing restaurants due to the COVID-19 pandemic. The City stated it did so because allowing outdoor dining poses a health and safety risk to the community. Barfly requested a revocation hearing. After holding the hearing, the City did not reinstate Barfly’s CUP.

On March 1, 2021, the City filed its complaint in this case alleging that defendants continued to operate the restaurant. On March 8, the court granted a temporary restraining order requiring Barfly to close the restaurant and authorizing the City to disconnect electrical service and padlock the restaurant’s doors. On April 9, 2021, the court issued a preliminary injunction continuing the order to close the restaurant but declining to “authorize” additional enforcement mechanisms the City requested.

The next day, the City began to build a wall around the restaurant. The City has also arrested Lucas Lepejian three times for “violating a lawful court order.”

Cross-complainants allege that the City’s suspension of the Barfly’s conditional use permit and related actions violated their constitutional rights. The second amended cross-complaint (SACC) alleges nine causes of action for violations of:

(1) Due Process Clauses of Fifth and Fourteenth Amendments to U.S. Constitution (42 U.S.C. 1983);

(2) Equal Protection Clause of Fourteenth Amendment to U.S. Constitution (42 U.S.C. 1983);

(3) Due Process Clause of Fifth and Fourteenth Amendment to U.S. Constitution (42 U.S.C. 1983);

(4) Excessive Fines / Cruel and Unusual Punishment (42 U.S.C. 1983);

(5) First Amendment Freedom of Assembly Clause (42 U.S.C. 1983);

(6) Takings Clause of the Fifth Amendment;

(7) California Constitution Right to Liberty (Cal. Const. Art. 1, 19);

(8) Contracts Clause of the U.S. Constitution (U.S. Const. Art. 1, 10); and

(9) Bane Civil Rights Act (Cal. Civ. Code. 52.1).

REQUESTS FOR JUDICIAL NOTICE

The City requests judicial notice of 21 exhibits: various federal, State, and County of Los Angeles publications about the COVID-19 pandemic (Exs. 1-4, 9-10), executive orders regarding the pandemic by the State of California (Exs. 5, 8, 11), County of Los Angeles (Exs. 6, 12-13) and City of Burbank (Ex. 7), several records of this Superior Court (Exs. 14-18,), a notice of violation issued by the City of Burbank to defendant/cross-complainant Barfly, Inc. (Ex. 19), a notice of enforcement of eviction by the Los Angeles County Sheriff’s Department in Case No. 1PDUD00357 (Ex. 20), and citations issued by the City to Baret Lepejian, Lucas Lepejian, and Talya Lepejian (Ex. 21).

The executive orders, government publications, notice of violation and citations, and notice of enforcement of eviction are subject to judicial notice as “[o]fficial acts of the legislative, executive, and judicial departments of the United States and of any state of the United States.” (Evid. Code, 452(c).) The court records are subject to judicial notice under Evidence Code section 452, subdivision (d)(1). The court takes judicial notice of the existence of all 21 exhibits, their contents, and their legal effects, but not the truth of the facts stated therein. (See In re Vicks (2013) 56 Cal.4th 274, 314.)

The City’s requests for judicial notice are granted.

Cross-complainants request judicial notice of three exhibits[1]:

(1) the City’s resolution No. 20-29,203;

(2) the City’s staff report dated February 22, 2021; and

(3) the press release by the County Department of Public Health dated March 30, 2021.

The three exhibits are official government acts subject to judicial notice for their existence, contents, and legal effects.

Cross-complainant’s requests for judicial notice are granted.

ANALYSIS

1. First cause of action for violation of substantive due process

The second amended cross-complaint fails to allege sufficient facts to constitute this cause of action. The threshold issue is the standard of review. “In a substantive due process analysis, we must first consider whether the statute in question abridges a fundamental right. . . . If not, the statute need only bear a ‘reasonable relation to a legitimate state interest to justify the action.’ ” (U.S. v. Juvenile Male (9th Cir. 2012) 670 F.3d 999, 1012 (Juvenile).)

The rational basis standard applies because cross-complainants do not allege violation of any fundamental right. County of Los Angeles Department of Public Health v. Superior Court of Los Angeles County (2021) 61 Cal.App.5th 478 (LADPH) held that rational basis review applied to restaurants’ challenge of regulations and restrictions prompted by the pandemic. (Id. at pp. 488-490; see Juvenile, supra, 670 F.3d at p. 1012 [fundamental “ rights are few, and include the right to marry, to have children, to direct the education and upbringing of one's children, to marital privacy. . .”].)

There is an “extremely deferential standard of review applicable to emergency exercises of governmental authority during a public health emergency.” (Id. at pp. 488-489, citing Jacobson v. Massachusetts (1905) 197 U.S. 11, 39 (Jacobson).) Though “Jacobson predates the tiers of scrutiny used in modern constitutional law” (LADPH, at p. 488), LADPH held that restaurants’ substantive due process claims about pandemic-related closures “are analyzed in essentially the same way under Jacobson or employing modern rational basis review.” (Id. at p. 489.)

Under the rational basis standard, conduct is constitutional “if there is any reasonably conceivable state of facts that could provide a rational basis for” it. (F.C.C. v. Beach Communications, Inc. (1993) 508 U.S. 307, 313 (F.C.C.)].) “A substantive due process violation requires more than ‘ordinary government error,’ and the ‘arbitrary and capricious’ standard applicable in other contexts is a lower threshold than that required to establish a substantive due process violation. [Citation.] A substantive due process violation requires some form of outrageous or egregious conduct constituting ‘a true abuse of power.’ ” (Las Lomas Land Co., LLC v. City of Los Angeles (2009) 177 Cal.App.4th 837, 855–856 (Las Lomas).) “[R]ational basis review allows for decisions ‘based on rational speculation unsupported by evidence or empirical data.’ ” (U.S. v. Navarro (9th Cir. 2015) 800 F.3d 1104, 1114, citing F.C.C., supra, 508 U.S. at p. 315; see also Las Lomas, supra, 177 Cal.App.4th at p. 857.)

LADPH applied the rational basis standard in reviewing a trial court’s injunction prohibiting the County from enforcing the same restaurant closure order implemented by the City until the County conducted an additional “risk-benefit analysis.” (LADPH, supra,61 Cal.App.5th at p. 493.) The court stated that “the core issue is whether the County’s temporary suspension of outdoor restaurant dining is rationally related to a legitimate state interest, i.e., limiting the spread of COVID-19.” (Id. at p. 491.) LADPH held that “the court’s appropriate role” was solely to determine whether the agency’s action was arbitrary. (Id. at p. 493.) The court concluded, “Because the Restaurateurs failed to satisfy their burden of demonstrating the Order is arbitrary, capricious, or without rational basis, we conclude they cannot ultimately succeed on the merits of their [substantive due process] claims.” (Id. at p. 495.)

The second amended cross-complaint alleges:

54. The Regional and County shutdown orders and Cross-Defendants’ enforcement thereof through their local emergency orders violate the Due Process Clauses of the Fifth and Fourteenth Amendments, both facially and as-applied to Cross-Complainants.

[ ]

56. [The City’s] implementation and enforcement of the [State and County] Orders have had a disparate impact on Cross-Complainants and have unfairly targeted Cross-Complainants’ business, specifically their ability to earn a living by conducting outdoor dining, despite the total lack of scientific evidence or data to support the implementation of the Orders as applied to Cross-Complainants.

57. Cross-Defendants’ basis that their emergency orders are to “protect the public health” is merely a cloak of immunity to evade judicial review. Allowing exemptions to Cross-Defendants’ emergency orders, i.e., non-restaurant businesses conducting outdoor dining, while forcing specifically restaurants to shut down is arbitrary government action Cross-Complainants are protected against under the U.S. Constitution.

(SACC, 54, 56-57.)

Assuming the City can be liable under 42 U.S.C. section 1983 for enforcing the County’s or State’s orders,[2] these allegations fail to state a cause of action for violation of substantive due process against the City. Just as in LADPH, there is a rational basis for the City to enforce State and County orders prohibiting outdoor dining: to protect the public from contagious disease by minimizing close contact between people. Eating at a restaurant results in close contact between people, including unrelated people who otherwise would not encounter one another. It is rational that doing so increases transmission of the virus, while prohibiting that reduces transmission.

Unlike other businesses that incidentally “conduct[] outdoor dining,” restaurants exist to serve food to diners. That means different groups of people coming and going with a substantial rate of turnover, which widens the circles of contact between people and therefore likely contributes to transmitting a contagious airborne virus. Furthermore, there is a preexisting system of monitoring and enforcing rules and regulations regarding health and safety at restaurants.

Although LADPH reviewed an order issuing a preliminary injunction and considered the evidence, the same conclusion is appropriate on demurrer. It makes no difference whether outdoor dining truly poses a danger to public health and that revoking Tin Horn Flats’ conditional use permit truly protects the public. Even if the government is wrong on the science and empirical evidence on how outdoor dining affects the spread of COVID-19, prohibiting outdoor dining is not an abuse of power. The only question is if there is a rational basis for the government to believe so—and there is.

2. Second cause of action for violation of equal protection

The second amended cross-complaint fails to allege sufficient facts to state this cause of action against the City for the same reason as the substantive due process claim. “‘The first prerequisite to a meritorious claim under the equal protection clause is a showing that the state has adopted a classification that affects two or more similarly situated groups in an unequal manner.’ [Citations.] This initial inquiry is not whether persons are similarly situated for all purposes, but ‘whether they are similarly situated for purposes of the law challenged.’ [Citation.]” (Cooley v. Superior Court (2002) 29 Cal.4th 228, 253.)

The second question is “whether disparate treatment of the groups is justified.” (Landau v. Superior Court (2019) 32 Cal.App.5th 1072, 1085.) A “classification neither involving fundamental rights nor proceeding along suspect lines . . . cannot run afoul of the Equal Protection Clause if there is a rational relationship between disparity of treatment and some legitimate governmental purpose.” (Central State Univ. v. Am. Assn. of Univ. Professors (1999) 526 U.S. 124, 127-128.) The rational basis standard applies to “economic and social welfare legislation in which there is a ‘discrimination’ or differentiation of treatment between classes or individuals.” (Hernandez v. City of Hanford (2007) 41 Cal.4th 279, 298, quoting Warden v. State Bar (1999) 21 Cal.4th 628, 640-641 [zoning ordinance prohibited selling furniture except by stores with 50,000 square feet of floor space].)

The second amended cross-complaint alleges the government “discriminatorily label[ed] restaurants as ‘non-essential’.” (SACC, 74.) Again, it does not allege the City itself did that. Assuming the City is liable for the classification, cross-complainants fail to state sufficient facts to constitute a violation of equal protection.

Assuming the groups are similarly situated, there is a rational basis for different treatment as discussed above. “The rational basis test is used for both equal protection analysis involving economic legislation [citations] and substantive due process analysis [citations].” (Morning Star Co. v. Board of Equalization (2011) 201 Cal.App.4th 737, 756.) Again, there is no need for evidence showing that the rational basis is empirically correct. “A court must reject an equal protection challenge to government action ‘if there is any reasonably conceivable state of facts that could provide a rational basis for the’ ” classification. (Las Lomas, supra, 177 Cal.App.4th at p. 858, quoting F.C.C., supra, 508 U.S. at p. 313; see also Collins v. Thurmond (2019) 41 Cal.App.5th 879, 896 [“appellants have failed to state a claim under the federal equal protection clause”].)

This cause of action also fails as a “class of one” claim.

[A] “class of one” equal protection claim is sufficient if the plaintiff alleges that (1) the plaintiff was treated differently from other similarly situated persons, (2) the difference in treatment was intentional, and (3) there was no rational basis for the difference in treatment. The third element is essentially the same rational basis test typically applied in some other types of equal protection cases.

“The rational basis test is extremely deferential and does not allow inquiry into the wisdom of government action. A court must reject an equal protection challenge to government action “if there is any reasonably conceivable state of facts that could provide a rational basis for the [difference in treatment].” “Where there are ‘plausible reasons' for [the] action, ‘our inquiry is at an end.’ ” “Under the rational basis test, courts must presume the constitutionality of government action if it is plausible that there were legitimate reasons for the action. In other words, the plaintiff must show that the difference in treatment was “so unrelated to the achievement of any combination of legitimate purposes that we can only conclude that the [government’s] actions were irrational.”

(Las Lomas, supra, 177 Cal.App.4th at pp. 858–859, citations omitted.)

As the United States Supreme Court stated, “There are some forms of state action … which by their nature involve discretionary decisionmaking based on a vast array of subjective, individualized assessments. In such cases the rule that people should be ‘treated alike, under like circumstances and conditions’ is not violated when one person is treated differently from others, because treating like individuals differently is an accepted consequence of the discretion granted. In such situations, allowing a challenge based on the arbitrary singling out of a particular person would undermine the very discretion that such state officials are entrusted to exercise.” (Engquist v. Oregon Dept. of Agr. (2008) 553 U.S. 591, 603 (Engquist).)

Cross-complainants allege the City targeted them, rather than other restaurants and restaurateurs, because “Barfly publicly expressed its political views opposing the shutdown orders.” (SACC, 59.) They further allege “the City’s underlying intent was to silence and punish Barfly for expressing its beliefs.” (SACC, 60.) But they also allege their expression of political views “promoted congregations at Tin Horn of likeminded individuals.” (SACC, 59.) That Tin Horn hosted “congregations” of people is a rational basis for enforcing the State’s and County’s shutdown orders.

These allegations also cannot constitute an equal protection violation because they are not based on a discriminatory classification. “[A]n allegation that [citations] are given out on the basis of race or sex would state an equal protection claim, because such discriminatory classifications implicate basic equal protection concerns.” (Engquist, supra, 553 U.S. at p. 604.) Classifications based on race or sex are subject to heightened scrutiny, not rational basis review.

Cross-complainants’ reliance on Lockary v. Kayfetz (9th Cir. 1990) 917 F.2d 1150 is misplaced. The court applied the rule that “the rational relation test will not sustain conduct by state officials that is malicious, irrational or plainly arbitrary.” (Id. at p. 1155.) The plaintiffs alleged a public utility district arbitrarily refused to issue water hookups to their properties. (Ibid.) The utility district’s stated reason for its action was that a water shortage justified a moratorium on new water hookups. (Ibid.) The court reversed an order granting summary judgment because the plaintiffs “raised triable issues of fact surrounding the very existence of a water shortage.” (Ibid.)

Here, by contrast, cross-complainants do not allege the pandemic does not exist. The second amended cross-complaint acknowledges that “the COVID-19 pandemic hit California in March of 2020.” (SACC, 13.) Rather than an imaginary pretext for arbitrary state action, cross-complainants allege the pandemic did not justify the City’s actions. As discussed above, the City had a rational basis for its conduct.

3. Third cause of action for violation of procedural due process

The second amended cross-complaint fails to allege sufficient facts to state this cause of action against the City. Cross-complainants allege various things violated their right to procedural due process, only one of which is an action by the City. The City did not make “[t]he Regional and County orders.” (SACC, 85.) The City had no part in the Los Angeles County of Department of Public Health revoking the restaurant’s public health permit. (SACC, 29-32.) Cross-complainants also allege the City violated procedural due process by violating the Administrative Procedures Act (SACC, 87), but the Act only applies to state agencies, not municipalities. (Nightlife Partners v. City of Beverly Hills (2003) 108 Cal.App.4th 81, 91.)

There is only one action by the City that could ostensibly deprive cross-complainants of protected liberty or property interests without due process of law: revoking the restaurant’s conditional use permit. (SACC, 23-25, 34-37.) Under the due process clause, one who has acquired a permit generally has a protectible property interest in it. (Trans-Oceanic Oil Corp. v. City of Santa Barbara (1948) 85 Cal.App.2d 776, 783-784.) “In revoking a permit lawfully granted, due process requires that [the municipality] act only upon notice to the permittee, upon a hearing, and upon evidence substantially supporting a finding of revocation.” (Id. at p. 795.) “A compelling public necessity warranting the revocation of a use permit for a lawful business may exist if the conduct of a business as a matter of fact constitutes a nuisance and the permittee refuses to comply with reasonable conditions to abate the nuisance. In these circumstances a municipality has the authority to remove such a business under its police power to prohibit and enjoin nuisances.” (Korean American Legal Advocacy Foundation v. City of Los Angeles (1994) 23 Cal.App.4th 376, 393, fn. 5.)

The second amended cross-complaint does not allege lack of notice, hearing, or substantial evidence supporting the revocation. Instead, it alleges that at the revocation hearing, the restaurant asserted “there was a valid dispute as to whether the Health Order both Burbank and LACPDH base Tin Horn’s violations off of was in fact ‘lawful’.” (SACC, 34.) The City “concluded the hearing with the ruling revoking Tin Horn’s CUP with no consideration of the perfunctory question as to whether their decision was based on a valid law, in clear violation yet again of Tin Horn’s procedural due process rights.” (SACC, 37.)

In other words, the purported violation of procedural due process is that the hearing failed to determine whether the restaurant closure orders by the State and County were lawful. That is beyond the scope of the revocation hearing. The hearing’s scope is limited to determining if the permit: (1) “was obtained by fraud or misrepresentation,” (2) “has been exercised contrary to the terms or conditions of approval, or in violation of any statute, ordinance, law or regulation not excused by the Conditional Use Permit,” or (3) “the conditional use is being or has been so exercised as to be detrimental to the public health or safety or so as to constitute a nuisance.” (Burbank Mun. Code, 10-1-1952.) The right to procedural due process does not require the City Council to independently evaluate the lawfulness of orders by the State and County.

Cross-complainants also allege “Barfly was subjected to actual bias by the City during” the revocation hearing. (SACC, 36.) “When due process requires a hearing, the adjudicator must be impartial.” (Haas v. County of San Bernardino (2002) 27 Cal.4th 1017, 1025 (Haas).) When a party accuses an administrative hearing officer of bias arising from the hearing officer’s “personal or political views,” the party must show actual bias, not merely perceived bias. (Id. at p. 1033.)

To disqualify a hearing officer, “[a] party must allege concrete facts that demonstrate the challenged [decisionmaker] is contaminated with bias or prejudice. ‘Bias and prejudice are never implied and must be established by clear averments.’ [Citation.] Indeed, a party’s unilateral perception of an appearance of bias cannot be a ground for disqualification unless we are ready to tolerate a system in which disgruntled or dilatory litigants can wreak havoc with the orderly administration of dispute-resolving tribunals.” (Andrews v. Agricultural Labor Relations Bd. (1981) 28 Cal.3d 781, 792 (Andrews) [interpreting former Code of Civil Procedure section 170, subdivision (5)]; but see Haas, supra, 27 Cal.4th at p. 1032-1033 [bias “arising from financial interest” may be implied].)

Courts have recognized bias based on a decisionmaker’s “personal financial interest” or “prior personal animosity” to a party (Breakzone Billiards v. City of Torrance (2000) 81 Cal.App.4th 1205, 1238) and when the hearing involves “overlapping of advocacy and decision-making roles” (Nightlife Partners v. City of Beverly Hills (2003) 108 Cal.App.4th 81, 95 (Nightlife)).

Cross-complainants do not allege any concrete facts showing bias. They allege:

“Throughout the hearing, one of the City’s decisionmakers, Counselman Konstantine Anthony, expressed his bias against Barfly. One example was when he shockingly stated that he did not care what a judge had say about any judge’s rulings on whether the order was lawful:

Konstantine Anthony: I don’t think any of my questions are about the scientific analysis or any of the judge’s ruling. I’m just asking about what we have on the books right now.

Alexandra Kazarian: And what you have on the books is that they have to follow a lawful order and right now we don’t know if the order is lawful.

Konstantine Anthony: Sure. Sure, okay.”

(SACC 34.)

Cross-complainants further allege:

“[Anthony] made it clear that he prejudged the specific facts of Barfly’s case, depriving Barfly of due process: ‘You know, Rosa Parks actually had to sit in jail after she was taken off the bus. She did her time!’

“Upon information and belief, Barfly was subjected to actual bias by the City during its CUP hearing that deprived Barfly of due process.”

(SACC, 35-36.)

These allegations do not approach concrete facts showing bias. They show only a unilateral perception of bias. “[A] councilperson has a right to state views or concerns on matters of community policy without having his vote impeached.” (Cohan v. City of Thousand Oaks (1994) 30 Cal.App.4th 547, 558.)

Furthermore, in considering plaintiffs’ allegation that a decisionmaker “prejudged the specific facts of Barfly’s case” (SACC, 35), the court notes the relevant facts were undisputed. The disputed facts were limited to the scientific conclusions used to justify the regulations on restaurants. As discussed, above, that was beyond the scope of the hearing. Barfly did not dispute the relevant facts—that it continued to operate after the County revoked its public health permit. (SACC, 29-32.)

In the opposition, cross-complainants rely on facts not alleged in the second amended cross-complaint: that “the Chief Assistant City Attorney who was acting Burbank’s advocate at the hearing wrote the Staff Report and its attached proposed Resolution (suggesting CUP revocation) provided to the Burbank City Council prior to the revocation hearing, both of which were silent as to considering any arguments or evidence Barfly raised during the actual hearing.” (Opp, p. 7, citing Opp. RJN, Ex. 2.)

Even if the second amended cross-complaint included these factual allegations, they would be insufficient. “The mere fact that the decision-maker or its staff is a more active participant in the factfinding process—similar to the judge in European civil law systems—will not render an administrative procedure unconstitutional.” (Howitt v. Superior Court (1992) 3 Cal.App.4th 1575, 1581.) But “to permit an advocate for one party to act as the legal advisor for the decision-maker creates a substantial risk that the advice given to the decision-maker will be skewed [citation], particularly when the prosecutor serves as the decision-maker’s advisor in the same or a related proceeding.” (Nightlife, supra 108 Cal.App.4th at p. 93.)

That an attorney gave a recommendation and wrote a report after the hearing does not deprive cross-complainants of a fair hearing. In Nightlife, the attorney “acted as both advocate for the initial denial of the renewal application, and then as advisor to the decision-maker on the appeal of the decision for which he had advocated.” (108 Cal.App.4th at p. 96.) Nothing in the second amended cross-complaint, the opposition, or the documents subject to judicial notice show that the City’s attorney acted as an advocate at any time.

4. Fourth cause of action for excessive fines

The second amended cross-complaint fails to allege sufficient facts for this cause of action. A “civil penalty” with a “partially punitive purpose, is a fine for purposes of the constitutional protection.” (City and County of San Francisco v. Sainez (2000) 77 Cal.App.4th 1302, 1321.) “The touchstone of the constitutional inquiry under the Excessive Fines Clause is the principle of proportionality: The amount of the forfeiture must bear some relationship to the gravity of the offense that it is designed to punish.” (U.S. v. Bajakajian (1998) 524 U.S. 321, 334.) “[A] punitive forfeiture violates the Excessive Fines Clause if it is grossly disproportional to the gravity of a defendant’s offense.” (Ibid.) The key considerations in this analysis are: “(1) the defendant’s culpability; (2) the relationship between the harm and the penalty; (3) the penalties imposed in similar statutes; and (4) the defendant’s ability to pay.” (People ex rel. Lockyer v. R.J. Reynolds Tobacco Co. (2005) 37 Cal.4th 707, 728.)

The second amended cross-complaint alleges the City issued “citations totaling upwards of $50,000” to cross-complainants. (SACC, 52.) Exhibit 21 to the City’s request for judicial notice shows the City issued 11 citations to Lucas Lepejian, Baret Lepejian, and Tayla Lepejian in escalating amounts totaling $3,700. (RJN, Ex. 21.) The fines totaled $100 to Tayla Lepejian, $1,800 to Lucas Lepejian, and $1,800 to Baret Lepejian. (Ibid.) The opposition concedes that “Burbank fined Barfly a total of $3,700 for remaining open.” (Opp., p. 8.)

These fines were not excessive in consideration of four key factors. First, the cross-complainants are highly culpable. They admit violating the law. They engaged in “continuing offenses” and repeated “disobedience of the City’s ordinances.” (People v. Braum (2020) 49 Cal.App.5th 342, 361.) Second, the harms were a public nuisance, namely operation of a bar and restaurant without the necessary permit, and the potential of increasing the spread of a contagious virus. The penalties for these harms are minimal. Third, cross-complainants do not argue the relevant ordinances, per se, impose excessive fines. They challenge the basis for revoking the conditional use permit, which resulted in the bar’s operation becoming a public nuisance. These same fines apply to any bar operating without a permit. Fourth, cross-complainants do not allege they are unable to pay the $3,700 in fines.

5. Fifth cause of action for violation of the First Amendment

The second amended cross-complaint alleges sufficient facts for this cause of action. “A plaintiff may bring a Section 1983 claim alleging that public officials, acting in their official capacity, took action with the intent to retaliate against, obstruct, or chill the plaintiff’s First Amendment rights. [Citation.] To bring a First Amendment retaliation claim, the plaintiff must allege that (1) it engaged in constitutionally protected activity; (2) the defendant’s actions would “chill a person of ordinary firmness” from continuing to engage in the protected activity; and (3) the protected activity was a substantial motivating factor in the defendant’s conduct—i.e., that there was a nexus between the defendant’s actions and an intent to chill speech. [Citations.] Further, to prevail on such a claim, a plaintiff need only show that the defendant ‘intended to interfere’ with the plaintiff’s First Amendment rights and that it suffered some injury as a result; the plaintiff is not required to demonstrate that its speech was actually suppressed or inhibited.” (Arizona Students’ Association v. Arizona Board of Regents (9th Cir. 2016) 824 F.3d 858, 867.)

Cross-complainants allege each element. First, they allege, “In an exercise of its First Amendment right to freedom of speech and assembly, Barfly publicly expressed its political views opposing the shutdown orders.” Publicly expressing political views is constitutionally protected activity.[3]

Second, they allege the City took actions that chill a person of ordinary firmness from continuing to engage in protected activity. They allege the City revoked Barfly’s CUP (SACC, 34-37), “shut off the restaurant’s power” (SACC, 42), and “block[ed] off the restaurant” by building a wall around it (SACC, 50-51). Shutting down one’s business would chill a person of ordinary fitness from continuing to speak.

Third, cross-complainants allege the City acted with intent to chill their speech. “The City arbitrarily enforced the rules specifically against Barfly, but not other Restaurants. . . because the City’s underlying intent was to silence and punish Barfly for expressing its beliefs.” (SACC, 16-17.)

The City argues it cannot be liable under Monell v. Department of Social Services of City of New York (1978) 436 U.S. 658 (Monell). The second amended cross-complaint does not seek to hold the City vicariously liable for “an injury inflicted solely by its employees or agents.” (Id. at p. 694.) “Local governing bodies. . . can be sued directly under 1983” when “the action that is alleged to be unconstitutional implements or executes a policy statement, ordinance, regulation, or decision officially adopted and promulgated by that body’s officers.” (Id. at p. 690.) “Where the ultimate decision-making authority itself has committed the unlawful act . . . the plaintiff need not also prove that there was a continuing custom or practice of that particular deprivation.” (Felton v. Board of Com'rs of County of Greene (7th Cir. 1993) 5 F.3d 198, 203 [plaintiff alleged County’s governing body denied him reappointment to a job because of his political affiliation]; accord Trevino v. Gates (9th Cir. 1996) 99 F.3d 911, 918.)

Cross-complainants allege the City retaliated against them via official acts: revoking Barfly’s conditional use permit via resolution No. 21-29,211 of the City Council (SACC, 34-37; Opp. RJN, Ex. 1) and by filing this lawsuit.

6. Sixth and seventh causes of action for federal and California takings clauses

The sixth and seventh causes of action require the same analysis. The second amended cross-complaint labels the seventh cause of action violation of the “right to liberty” under article 1, section 19 of the California Constitution. That section is the California takings clause. “California courts generally construe the federal and California takings clauses congruently.” (Small Property Owners of San Francisco v. City and County of San Francisco (2006) 141 Cal.App.4th 1388, 1395–1396.) Under the takings clause, a plaintiff “must establish (1) it has a protectable property interest, (2) there has been a taking of the property, and (3) the taking was for a public purpose.” (Bronco Wine Co. v. Jolly (2005) 129 Cal.App.4th 988, 1030.) Either federal or state law may establish a protectable property interest. (Ibid.)

The second amended cross-complaint fails to allege sufficient facts to constitute taking of a protectable property interest. Code of Civil Procedure “section 1263.510 authorized compensation for the loss of business goodwill.” (Inglewood Redevelopment Agency v. Aklilu (2007) 153 Cal.App.4th 1095, 1107.) Under that section, “the business owner has the initial burden of showing entitlement to compensation for lost goodwill” which requires showing “the loss cannot reasonably be prevented by relocating the business or otherwise mitigating damages.” (Ibid.)

The second amended cross-complaint alleges that “the City intentionally tarnished Tin Horn’s reputation in the community” and “effectively eliminated the good will of Barfly’s business in its entirety.” (SACC, 146-147.) It fails, however, to allege “[t]he loss cannot reasonably be prevented by a relocation of the business or by taking steps and adopting procedures that a reasonably prudent person would take and adopt in preserving the goodwill.” (Code Civ. Proc., 1263.510, subd. (a)(2).)

Even if cross-complainants alleged they could not mitigate their loss of business goodwill, they still fail to allege sufficient facts. For a non-categorical regulatory taking under Penn Central Transportation Company. v. New York City (1978) 438 U.S. 104 (Penn Central), courts generally conduct “ad hoc, factual inquiries into the circumstances of each particular case.” (Connolly v. Pension Ben. Guar. Corp. (1986) 475 U.S. 211, 224–225 (Connolly).) Penn Central “identified three factors which have ‘particular significance’: (1) ‘the economic impact of the regulation on the claimant’; (2) ‘the extent to which the regulation has interfered with distinct investment-backed expectations’; and (3) ‘the character of the governmental action.’ ” (Connolly, at pp. 224–225, citing Penn Central, at p. 124.)

This analysis does not, however, always require factual inquiries—particularly when the character of the governmental action is an exercise of its police power. In Farmers Ins. Exchange v. State of California (1985) 175 Cal.App.3d 494 (Farmers), the court addressed this question. In 1980, the Governor declared a state of emergency due to a medfly infestation. (Id. at p. 499.) The State then conducted “wide-scale aerial spraying with the insecticide malathion,” which resulted in damage to automobile paint. (Id. at pp. 500-501.) Plaintiff insurance companies “were obliged to pay numerous claims of their policy holders for costs of new paint jobs.” (Id. at p. 498.) The Court of Appeal held:

The point is made that it is a question of fact whether the exercise of the police power is reasonable or proper under the circumstances, a matter which therefore cannot be resolved at the pleading stage. This may be so in those cases where it is unclear whether the public agency is exercising a regulatory police power or an eminent domain power constituting a taking. [Citations.] Where there exists an obvious emergent public interest, however, such analysis is unnecessary. “In such cases calling for immediate action the emergency constitutes full justification for the measures taken to control the menacing condition, and private interests must be held wholly subservient to the right of the state to proceed in such manner as it deems appropriate for the protection of the public health or safety.” [Citation.] Among the types of emergencies which justify police action without calling for compensation are “the demolition of all or parts of buildings to prevent the spread of conflagration, or the destruction of diseased animals, of rotten fruit, or infected trees where life or health is jeopardized.” [Citation.]

In our view there is no question but that the case at bar falls squarely within the police power exception to the just compensation rule stated in California Constitution Article I, section 19. Thus the State and its agents are afforded complete immunity from liability on this theory.

(Id. at pp. 501-502.)

In Farmers, there was no need to consider evidence on the extent of the threat caused by medflies or whether the spraying of insecticide was justified. The Court of Appeal found an infestation of medflies—an agricultural pest—was an obvious emergent public interest. Likewise, in the present case, the coronavirus pandemic is an obvious a public interest emergency justifying the use of the exercise of police power in prohibiting dining at restaurants and shuttering those that refuse to comply.

As the United States Supreme Court stated, “[W]here an owner possesses a full ‘bundle’ of property rights, the destruction of one ‘strand’ of the bundle is not a taking, because the aggregate must be viewed in its entirety.” (Andrus v. Allard (1979) 444 U.S. 51, 65–66.) At most, the City has destroyed one strand in cross-complainants’ bundle of rights.

7. Eighth cause of action for violation of Contracts Clause

Cross-complainants fail to allege sufficient facts to constitute a violation of the Contracts Clause of the United States Constitution (Art. I, 10). “The threshold inquiry is ‘whether the state law has, in fact, operated as a substantial impairment of a contractual relationship.’ [Citation.]” (Energy Reserves Group, Inc. v. Kansas Power and Light Co. (1983) 459 U.S. 400, 411.) “If the state regulation constitutes a substantial impairment, the State, in justification, must have a significant and legitimate public purpose behind the regulation, [citation] such as the remedying of a broad and general social or economic problem.” (Id. at pp. 411-412.) Finally, the court determines “whether the adjustment of ‘the rights and responsibilities of contracting parties [is based] upon reasonable conditions and [is] of a character appropriate to the public purpose justifying’ ” the impairment of the contract. (Id. at p. 412.) For contracts between private parties, “courts properly defer to legislative judgment as to the necessity and reasonableness of a particular measure.” (U.S. Trust Co. of New York v. New Jersey (1977) 431 U.S. 1, 23.)

The second amended cross-complaint alleges, “The Shutdown Orders and Cross-Defendants’ arbitrary and capricious enforcement of them through Cross-Defendants’ local orders fundamentally upend the contractual bargains struck between Cross-Complainant employers and their employees by effectively terminating contracted-for employment without any recourse for a period of time.” (SACC, 163.)

Assuming the City’s conduct substantially impaired these contractual relationships, the legitimate public purpose is to protect the public from the spread of a deadly virus. The final question, whether that purpose justifies the impairment, is parallel to the rational basis test used for substantive due process and equal protection. Prohibiting in-person dining at restaurants and revoking the restaurant’s conditional use permit for not complying are reasonable means to further that legitimate public purpose.

8. Ninth cause of action for violation of Bane Civil Rights Act

The second amended cross-complaint fails to allege sufficient facts for this cause of action. A violation requires: “(1) intentional interference or attempted interference with a state or federal constitutional or legal right, and (2) the interference or attempted interference was by threats, intimidation or coercion.” (Allen v. City of Sacramento (2015) 234 Cal.App.4th 41, 67.) “The word ‘interferes’ as used in the Bane Act means ‘violates.’ [Citations.] The essence of a Bane Act claim is that the defendant, by the specified improper means (i.e., ‘threats, intimidation or coercion’), tried to or did prevent the plaintiff from doing something he or she had the right to do under the law or to force the plaintiff to do something that he or she was not required to do under the law.” (Austin B. v. Escondido Union School Dist. (2007) 149 Cal.App.4th 860, 883.)

This cause of action fails because cross-complainants do not allege any attempted or completed interference with their rights via threats, intimidation, or coercion. The only cause of action sufficiently alleged is a First Amendment retaliation claim under 42 U.S.C. section 1983. Cross-complainants allege retaliation via the City’s official acts: revoking Barfly’s conditional use permit, issuing citations, and filing this lawsuit. Using nonviolent formal legal procedures does not constitute threats, intimidation, or coercion.

In addition, cross-complainants fail to allege they complied with the Tort Claims Act or an excuse for not complying. Under the Tort Claims Act, plaintiffs must “submit a timely claim for money or damages to a public entity in order to maintain an action against that entity.” (State of California v. Superior Court (2004) 32 Cal.4th 1234, 1243.) “[A] plaintiff must allege facts demonstrating or excusing compliance with the claim presentation requirement.” (Ibid.) The Bane Civil Rights Act does not abrogate statutory immunities under the Government Code. (Towery v. State of California (2017) 14 Cal.App.5th 226, 233-237.)

DISPOSITION

Cross-defendants’ demurrer to the first through fourth causes of action and sixth through ninth causes of action is sustained with 20 days’ leave to amend. Cross-defendants’ demurrer to the fifth cause of action is overruled.


[1] The exhibits attached to the request for judicial notice are mislabeled. The court numbers them as described in the body of the request for judicial notice.

[2] There is persuasive authority to the contrary. (See Surplus Store and Exchange, Inc. v. City of Delphi (7th Cir. 1991) 928 F.2d 788, 791, fn. 4 [This argument would render meaningless the entire body of precedent… that requires culpability on the part of a municipality and/or its policymakers before the municipality can be held liable under 1983, and would allow municipalities to be nothing more than convenient receptacles of liability for violations caused entirely by state actors”].)

[3] The City’s demurrer does not address these allegations. Instead, the City argues generalized “social association” involved in meeting for food and drinks is not protected under the First Amendment. (Dem., p. 26.)



Case Number: *******7923 Hearing Date: January 11, 2022 Dept: 52

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

City of Burbank, a municipal corporation, et al.

Plaintiffs,

v.

Barfly, Inc., a California corporation, et al.

Defendants.

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Case No. *******7923

[TENTATIVE] ORDER REGARDING CROSS-DEFENDANTS’ DEMURRER

Hearing: January 11, 2022

Barfly, Inc., a California corporation, et al.

Cross-Complainants,

v.

City of Burbank, a municipal corporation, et al.

Cross-Defendants.

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Plaintiffs/cPlaintiffs/cross-defendants City of Burbank (City) and the People of the State of California, by and through Joseph H. McDougall, City Attorney for the City of Burbank generally demur to the first amended cross-complaint filed by cross-complainants Barfly, Inc. (Barfly), Baret Lepejian, Lucas Lepejian, and Tayla Lepejian.

Barfly operates as Tin Horn Flats Saloon & Grill in Burbank. Baret, Lucas, and Tayla Lepejian are agents of Barfly. Operating the restaurant requires a conditional use permit issued by the City.

On December 12, 2020, the City suspended Barfly’s conditional use permit for allowing outdoor dining despite the County of Los Angeles’s order closing restaurants due to the COVID-19 pandemic. The City stated it did so because allowing outdoor dining poses a health and safety risk to the community. Barfly requested a revocation hearing. The City held the hearing and did not reinstate Barfly’s conditional use permit.

On March 1, 2021, the City filed its complaint in this case alleging that defendants continued to operate the restaurant. On March 8, the court granted a temporary restraining order requiring Barfly to close the restaurant and authorizing the City to disconnect electrical service and padlock the restaurant’s doors. On April 9, 2021, the court issued a preliminary injunction continuing the order to close the restaurant but declining to “authorize” additional enforcement mechanisms the City requested.

The next day, the City began to build a wall around the restaurant. The City has also arrested Lucas Lepejian three times for “violating a lawful court order.”

Cross-complainants allege that the City’s suspension of the Barfly’s conditional use permit and related actions violated their constitutional rights. The first amended cross-complaint (FACC) alleges nine causes of action for violations of:

(1) Due Process Clauses of Fifth and Fourteenth Amendments to U.S. Constitution (42 U.S.C. 1983);

(2) Equal Protection Clause of Fourteenth Amendment to U.S. Constitution (42 U.S.C. 1983);

(3) Due Process Clause of Fifth and Fourteenth Amendment to U.S. Constitution (42 U.S.C. 1983);

(4) Excessive Fines / Cruel and Unusual Punishment (42 U.S.C. 1983);

(5) First Amendment Freedom of Assembly Clause (42 U.S.C. 1983);

(6) Takings Clause of the Fifth Amendment;

(7) California Constitution Right to Liberty (Cal. Const. Art. 1, 19);

(8) Contracts Clause of the United States Constitution (U.S. Const. Art. 1, 10); and

(9) Bane Civil Rights Act (Cal. Civ. Code. 52.1)

ANALYSIS

1. Substantive Due Process

The first amended cross-complaint fails to allege sufficient facts to constitute this cause of action. The threshold issue is the standard of review. County of Los Angeles Department of Public Health v. Superior Court of Los Angeles County (2021) 61 Cal.App.5th 478 (LADPH) stated there is an “extremely deferential standard of review applicable to emergency exercises of governmental authority during a public health emergency.” (Id. at pp. 488-489, citing Jacobson v. Massachusetts (1905) 197 U.S. 11, 39 (Jacobson).) Though “Jacobson predates the tiers of scrutiny used in modern constitutional law” (LADPH, at p. 488), LADPH held that restaurants’ substantive due process claims about pandemic-related closures “are analyzed in essentially the same way under Jacobson or employing modern rational basis review.” (Id. at p. 489.)

Under the rational basis standard, conduct is constitutional “if there is any reasonably conceivable state of facts that could provide a rational basis for” it. (F.C.C. v. Beach Communications, Inc. (1993) 508 U.S. 307, 313 (F.C.C.)].) “A substantive due process violation requires more than ‘ordinary government error,’ and the ‘arbitrary and capricious’ standard applicable in other contexts is a lower threshold than that required to establish a substantive due process violation. [Citation.] A substantive due process violation requires some form of outrageous or egregious conduct constituting ‘a true abuse of power.’ ” (Las Lomas Land Co., LLC v. City of Los Angeles (2009) 177 Cal.App.4th 837, 855–856 (Las Lomas).)

LADPH applied the rational basis standard in reviewing a trial court’s injunction prohibiting the County from enforcing the same restaurant closure order implemented by the City until the County conducted an additional “risk-benefit analysis.” (61 Cal.App.5th at p. 493.) The court stated that “the core issue is whether the County’s temporary suspension of outdoor restaurant dining is rationally related to a legitimate state interest, i.e., limiting the spread of COVID-19.” (LADPH, supra, 61 Cal.App.5th at p. 491.) LADPH held that “the court’s appropriate role” was solely to determine whether the agency’s action was arbitrary. (Id. at p. 493.) The court concluded, “Because the Restaurateurs failed to satisfy their burden of demonstrating the Order is arbitrary, capricious, or without rational basis, we conclude they cannot ultimately succeed on the merits of their [substantive due process] claims.” (Id. at p. 495.)

The first amended cross-complaint alleges:

48. The Regional and County shutdown orders and Cross-Defendants’ enforcement thereof through their local emergency orders violate the Due Process Clauses of the Fifth and Fourteenth Amendments, both facially and as-applied to Cross-Complainants.

[ ]

50. [The City’s] implementation and enforcement of the [State and County] Orders have had a disparate impact on Cross-Complainants and have unfairly targeted Cross-Complainants’ business, specifically their ability to earn a living by conducting outdoor dining, despite the total lack of scientific evidence or data to support the implementation of the Orders as applied to Cross-Complainants.

51. Cross-Defendants’ basis that their emergency orders are to “protect the public health” is merely a cloak of immunity to evade judicial review. Allowing exemptions to Cross-Defendants’ emergency orders, i.e., non-restaurant businesses conducting outdoor dining, while forcing specifically restaurants to shut down is arbitrary government action Cross-Complainants are protected against under the U.S. Constitution.

(FACC, 48, 50-51.)

Assuming the City can be liable under 42 U.S.C. section 1983 for enforcing the County’s or State’s orders,[1] these allegations fail to state a cause of action for violation of substantive due process against the City. Just as in LADPH, there is a rational basis for the City to enforce State and County orders prohibiting outdoor dining: to protect the public from contagious disease by minimizing close contact between people. Eating at a restaurant results in close contact between people, including unrelated people who otherwise would not encounter one another. It is rational that doing so increases transmission of the virus, while prohibiting that reduces transmission.

Unlike other businesses that incidentally “conduct[] outdoor dining,” restaurants exist to serve food to diners. That means different groups of people coming and going with a substantial rate of turnover, which widens the circles of contact between people and therefore likely contributes to transmitting a contagious airborne virus. Furthermore, there is a preexisting system of monitoring and enforcing rules and regulations regarding health and safety at restaurants.

Though the first amended cross-complaint alleges the City violated the due process clause “both facially and as-applied” (FACC, 48), it does not allege the City arbitrarily enforced the rules specifically against Barfly, but not other restaurants. The only factual allegation of a violation as applied is “disparate impact” or being “unfairly targeted” (FACC, 50) because the City allowed exemptions to “non-restaurant businesses conducting outdoor dining, while forcing specifically restaurants to shut down.” (FACC, 51.) That is a facial challenge to the County’s orders, not an applied challenge to the City’s conduct. The Revised Temporary Targeted Safer at Home Health Officer Order for control of COVID-19, issued by the County of Los Angeles Department of Public Health on December 9, 2020, requires all restaurants to close for indoor or outdoor dining. (RJN, Ex. 12, 5.e., 8.n.) The revised order issued on December 30, 2020 does the same. (RJN, Ex. 13, 5.e., 8.n.) Any distinction between restaurants and other businesses with outdoor dining comes from those County orders.

Cross-complainants argue that this cause of action cannot be resolved on the pleadings and can only be done based on the evidence. The court disagrees. “[R]ational basis review allows for decisions ‘based on rational speculation unsupported by evidence or empirical data.’ ” (U.S. v. Navarro (9th Cir. 2015) 800 F.3d 1104, 1114, citing F.C.C., supra, 508 U.S. at p. 315; see also Las Lomas, supra, 177 Cal.App.4th at p. 857.) Although LADPH reviewed an order issuing a preliminary injunction and considered the evidence, the same conclusion is appropriate on demurrer. It makes no difference whether outdoor dining truly poses a danger to public health and that revoking Tin Horn Flats’ conditional use permit truly protects the public. Even if the government is wrong on the science and empirical evidence on how outdoor dining affects the spread of COVID-19, prohibiting outdoor dining is not an abuse of power. The only question is if there is a rational basis for the government to believe so—and there is.

2. Equal Protection

The first amended cross-complaint fails to allege sufficient facts to state this cause of action against the City for the same reason as the substantive due process claim. “‘The first prerequisite to a meritorious claim under the equal protection clause is a showing that the state has adopted a classification that affects two or more similarly situated groups in an unequal manner.’ [Citations.] This initial inquiry is not whether persons are similarly situated for all purposes, but ‘whether they are similarly situated for purposes of the law challenged.’ [Citation.]” (Cooley v. Superior Court (2002) 29 Cal.4th 228, 253.)

The second question is “whether disparate treatment of the groups is justified.” (Landau v. Superior Court (2019) 32 Cal.App.5th 1072, 1085.) A “classification neither involving fundamental rights nor proceeding along suspect lines . . . cannot run afoul of the Equal Protection Clause if there is a rational relationship between disparity of treatment and some legitimate governmental purpose.” (Central State Univ. v. Am. Assn. of Univ. Professors (1999) 526 U.S. 124, 127-128.) The rational basis standard applies to “economic and social welfare legislation in which there is a ‘discrimination’ or differentiation of treatment between classes or individuals.” (Hernandez v. City of Hanford (2007) 41 Cal.4th 279, 298, quoting Warden v. State Bar (1999) 21 Cal.4th 628, 640-641 [zoning ordinance prohibited selling furniture except by stores with 50,000 square feet of floor space].)

The first amended cross-complaint alleges the government “discriminatorily label[ed] restaurants as ‘non-essential’.” (FACC, 62.) Again, it does not allege the City itself did that. Assuming the City is liable for the classification, cross-complainants fail to state sufficient facts to constitute a violation of equal protection.

First, the City does not argue that restaurants are not similarly situated as other businesses. The court therefore does not address the question.

Second, assuming the groups are similarly situated, there is a rational basis for different treatment as discussed above. “The rational basis test is used for both equal protection analysis involving economic legislation [citations] and substantive due process analysis [citations].” (Morning Star Co. v. Board of Equalization (2011) 201 Cal.App.4th 737, 756.) Again, there is no need for evidence showing that the rational basis is empirically correct. “A court must reject an equal protection challenge to government action ‘if there is any reasonably conceivable state of facts that could provide a rational basis for the’ ” classification. (Las Lomas, supra, 177 Cal.App.4th at p. 858, quoting F.C.C., supra, 508 U.S. at p. 313; see also Collins v. Thurmond (2019) 41 Cal.App.5th 879, 896 [“appellants have failed to state a claim under the federal equal protection clause”].)

3. Procedural Due Process

The first amended cross-complaint fails to allege sufficient facts to state this cause of action against the City. The first issue is determining which allegations can support this cause of action against the City itself. Cross-complainants allege various things violated their right to procedural due process, only one of which is an action by the City. The City did not make “[t]he Regional and County orders.” (FACC, 68.) The City had no part in the Los Angeles County of Department of Public Health revoking the restaurant’s public health permit. (FACC, 26-29.) Cross-complainants also allege the City violated procedural due process by violating the Administrative Procedures Act (FACC, 73), but the Act only applies to state agencies, not municipalities. (Nightlife Partners v. City of Beverly Hills (2003) 108 Cal.App.4th 81, 91.)

There is only one action by the City that could ostensibly deprive cross-complainants of protected liberty or property interests without due process of law: revoking the restaurant’s conditional use permit. (FACC, 21, 25, 30-31.) Under the due process clause, one who has acquired a permit generally has a protectible property interest in it. (Trans-Oceanic Oil Corp. v. City of Santa Barbara (1948) 85 Cal.App.2d 776, 783-784.) “In revoking a permit lawfully granted, due process requires that [the municipality] act only upon notice to the permittee, upon a hearing, and upon evidence substantially supporting a finding of revocation.” (Id. at p. 795.) “A compelling public necessity warranting the revocation of a use permit for a lawful business may exist if the conduct of a business as a matter of fact constitutes a nuisance and the permittee refuses to comply with reasonable conditions to abate the nuisance. In these circumstances a municipality has the authority to remove such a business under its police power to prohibit and enjoin nuisances.” (Korean American Legal Advocacy Foundation v. City of Los Angeles (1994) 23 Cal.App.4th 376, 393, fn. 5.)

The first amended cross-complaint does not allege lack of notice, hearing, or substantial evidence supporting the revocation. Instead, it alleges that at the revocation hearing, the restaurant asserted “there was a valid dispute as to whether the Health Order both Burbank and LACPDH base Tin Horn’s violations off of was in fact ‘lawful’.” (FACC, 30.) The City “concluded the hearing with the ruling revoking Tin Horn’s CUP with no consideration of the perfunctory question as to whether their decision was based on a valid law, in clear violation yet again of Tin Horn’s procedural due process rights.” (FACC, 31.)

In other words, the purported violation of procedural due process is that the hearing failed to determine whether the restaurant closure orders by the State and County were lawful. That is beyond the scope of the revocation hearing. The hearing’s scope is limited to determining if the permit: (1) “was obtained by fraud or misrepresentation,” (2) “has been exercised contrary to the terms or conditions of approval, or in violation of any statute, ordinance, law or regulation not excused by the Conditional Use Permit,” or (3) “the conditional use is being or has been so exercised as to be detrimental to the public health or safety or so as to constitute a nuisance.” (Burbank Mun. Code, 10-1-1952.) The right to procedural due process does not require the City Council to independently evaluate the lawfulness of orders by the State and County.

4. Excessive Fines

The first amended cross-complaint fails to allege sufficient facts for this cause of action. A “civil penalty” with a “partially punitive purpose, is a fine for purposes of the constitutional protection.” (City and County of San Francisco v. Sainez (2000) 77 Cal.App.4th 1302, 1321.) “The touchstone of the constitutional inquiry under the Excessive Fines Clause is the principle of proportionality: The amount of the forfeiture must bear some relationship to the gravity of the offense that it is designed to punish.” (U.S. v. Bajakajian (1998) 524 U.S. 321, 334.) “[A] punitive forfeiture violates the Excessive Fines Clause if it is grossly disproportional to the gravity of a defendant’s offense.” (Ibid.) The key considerations in this analysis are: “(1) the defendant's culpability; (2) the relationship between the harm and the penalty; (3) the penalties imposed in similar statutes; and (4) the defendant’s ability to pay.” (People ex rel. Lockyer v. R.J. Reynolds Tobacco Co. (2005) 37 Cal.4th 707, 728.)

The first amended cross-complaint does not clearly state whether the City has, in fact, imposed excessive fines on cross-complainants and, if so, facts supporting such an allegation. The Eighth Amendment does not apply “until after [the government] has secured a formal adjudication of guilt.” (Ingraham v. Wright (1977) 430 U.S. 651, 671, fn. 40.) Cross-complainants allege, “It is unconscionable that Cross-Complainants and their employees and independent contractors could, in perpetuity, (as the Regional, County, and Local Orders have no sunset), face ruinous fines and months of incarceration.” (FACC, 99.) Potential fines or incarceration in the future, however, cannot state a present cause of action for violating the Eighth Amendment.

The first amended cross-complaint also alleges, “Cross-Defendants have used arbitrary and capricious outdoor dining shutdown orders, that have no relation to limiting the spread of Covid-19, to impose excessive civil penalties such as the underlying lawsuit Cross-Complainants are Defendants in, and to criminally fine, and even illegally arrest one of Cross-Complainants.” (FACC, 102.) This lawsuit cannot constitute a “fine” at this stage. Not only is it still pending, meaning no fine has been imposed yet, but also the City does not seek a civil penalty or even damages. (Comp., Prayer, p. 17:1-7.) Similarly, arresting someone is not a formal adjudication of guilt.

The only potential violation of the Eighth Amendment is that the City “used … outdoor dining shutdown orders … to criminally fine” cross-complainants. (FACC, 102.) But the first amended cross-complaint does not allege the amount of the fines, who was fined, or for what crime. These conclusory allegations fail to state a cause of action for imposing grossly disproportional fines.

5. Freedom of Assembly

The first amended cross-complaint fails to allege sufficient facts for this cause of action. LADPH addressed the same issue:

The First Amendment guarantees that “Congress shall make no law ... abridging ... the right of the people to peaceably assemble.”’ (U.S. Const. 1st Amend.) Constitutional rights, however, “may at times, under the pressure of great dangers” be restricted “as the safety of the general public may demand.” [Citation.] Specifically, states may impose reasonable restrictions on the time, place, and manner of protected speech and assembly provided the restrictions “ ‘are justified without reference to the content of the regulated speech, that they are narrowly tailored to serve a significant governmental interest, and that they leave open ample alternative channels for communication of the information.’ [Citations.]” … The Order meets this standard.

First, the Order does not regulate assembly based on the expressive content of the assembly. Instead, it prohibits all outdoor dining at restaurants, breweries, wineries, and bars irrespective of the purpose of the gathering or type of speech the patrons may wish to express.

Second, as stated above, it is undisputed limiting the spread of COVID-19 is a legitimate and substantial government interest. Banning outdoor dining, where people from different households gather in close proximity for extended periods without masks, is narrowly tailored to limiting the spread of COVID-19. [Citation.]

Third, the Order leaves open alternative channels for assembling, i.e., videoconference or in-person socially distant gatherings with face coverings. [Citation.] We therefore conclude the Order does not violate [the restaurant’s] purported First Amendment right to freedom of assembly or that of its patrons.

(LADPH, supra, 61 Cal.App.5th 478, 496.)

The situation in this case is identical. The same reasoning applies.

6. Federal Takings Clause; 7. California Takings Clause

The sixth and seventh causes of action require the same analysis. The first amended cross-complaint labels the seventh cause of action violation of the “right to liberty” under article 1, section 19 of the California Constitution. That section is the California takings clause. “California courts generally construe the federal and California takings clauses congruently.” (Small Property Owners of San Francisco v. City and County of San Francisco (2006) 141 Cal.App.4th 1388, 1395–1396.)

The first amended cross-complaint does not allege that cross-defendants have taken any tangible property from cross-complainants. “[T]akings cases almost universally involve governmental action that affects ownership rights in real property.” (Broad v. Sealaska Corp. (9th Cir. 1996) 85 F.3d 422, 430 [holding corporate equity is not property subject to the takings clause].) Tangible personal property can also be subject to the takings clause. (See, e.g., Andrus v. Allard (1979) 444 U.S. 51, 64 (Andrus) [bald eagle feathers].) But the Court of Appeal has held there is no property interest in a permit when the “permit was not only revocable, but also conditional.” (Belmont County Water Dist. v. State of California (1976) 65 Cal.App.3d 13, 20.) Instead of taking tangible property, the first amended cross-complaint alleges the “Regional and County shutdown orders . . . completely and unconstitutionally deprived Cross-Complainants of all economically beneficial use of its businesses without just compensation.” (FACC, 119, italics added.) If the first amended cross-complaint attempts to allege taking of real property at the restaurant’s location, the court notes that cross-complainant Baret Lepejian was evicted from the property on June 3, 2021. (RJN, Ex. 20.)

Assuming a “business” can be subject to a taking claim, the first amended cross-complaint fails to allege sufficient facts to constitute a taking. “The paradigmatic taking requiring just compensation is a direct government appropriation or physical invasion of private property.” (Lingle v. Chevron U.S.A., Inc. (2005) 544 U.S. 528, 537 (Lingle).) But “government regulation of private property may, in some instances, be so onerous that its effect is tantamount to a direct appropriation or ouster—and ... such ‘regulatory takings’ may be compensable.” (Ibid.) There are two types of per se takings: “First, where government requires an owner to suffer a permanent physical invasion of her property—however minor—it must provide just compensation.” (Id. at p. 538.) “A second categorical rule applies to regulations that completely deprive an owner of ‘all economically beneficial us[e]’ of her property.” (Ibid.)

Cross-complainants fail to allege sufficient facts for these three types of taking. They do not allege the City has directly appropriated or physically invaded their property. They allege the government has prevented them from serving diners at the restaurant and that the City revoked the restaurant’s conditional use permit. That did not deprive the owners of all economically beneficial uses of the property. The government merely limited one specific type of economically beneficial use. And until the City revoked the restaurant’s conditional use permit, it could have continued to operate as a restaurant for takeout and delivery.

The only potential claim is for a non-categorical regulatory taking under Penn Central Transportation Company. v. New York City (1978) 438 U.S. 104 (Penn Central). Rather than a “set formula,” courts generally conduct “ad hoc, factual inquiries into the circumstances of each particular case.” (Connolly v. Pension Ben. Guar. Corp. (1986) 475 U.S. 211, 224–225 (Connolly).) Penn Central “identified three factors which have ‘particular significance’: (1) ‘the economic impact of the regulation on the claimant’; (2) ‘the extent to which the regulation has interfered with distinct investment-backed expectations’; and (3) ‘the character of the governmental action.’ ” (Connolly, at pp. 224–225, citing Penn Central, at p. 124.)

This analysis does not, however, always require factual inquiries—particularly when the character of the governmental action is an exercise of its police power. In Farmers Ins. Exchange v. State of California (1985) 175 Cal.App.3d 494 (Farmers), the court addressed this question. In 1980, the Governor declared a state of emergency due to a medfly infestation. (Id. at p. 499.) The State then conducted “wide-scale aerial spraying with the insecticide malathion,” which resulted in damage to automobile paint. (Id. at pp. 500-501.) Plaintiff insurance companies “were obliged to pay numerous claims of their policy holders for costs of new paint jobs.” (Id. at p. 498.) The Court of Appeal held:

The point is made that it is a question of fact whether the exercise of the police power is reasonable or proper under the circumstances, a matter which therefore cannot be resolved at the pleading stage. This may be so in those cases where it is unclear whether the public agency is exercising a regulatory police power or an eminent domain power constituting a taking. [Citations.] Where there exists an obvious emergent public interest, however, such analysis is unnecessary. “In such cases calling for immediate action the emergency constitutes full justification for the measures taken to control the menacing condition, and private interests must be held wholly subservient to the right of the state to proceed in such manner as it deems appropriate for the protection of the public health or safety.” [Citation.] Among the types of emergencies which justify police action without calling for compensation are “the demolition of all or parts of buildings to prevent the spread of conflagration, or the destruction of diseased animals, of rotten fruit, or infected trees where life or health is jeopardized.” [Citation.]

In our view there is no question but that the case at bar falls squarely within the police power exception to the just compensation rule stated in California Constitution Article I, section 19. Thus the State and its agents are afforded complete immunity from liability on this theory.

(Id. at pp. 501-502.)

In Farmers, there was no need to consider evidence on the extent of the threat caused by medflies or whether the spraying of insecticide was justified. The Court of Appeal found an infestation of medflies—an agricultural pest—was an obvious emergent public interest. Likewise, in the present case, the coronavirus pandemic is an obvious a public interest emergency justifying the use of the exercise of police power in prohibiting dining at restaurants and shuttering those that refuse to comply.

As the United States Supreme Court stated, “[W]here an owner possesses a full ‘bundle’ of property rights, the destruction of one ‘strand’ of the bundle is not a taking, because the aggregate must be viewed in its entirety.” (Andrus v. Allard (1979) 444 U.S. 51, 65–66.) For whatever property cross-complainants allege was taken, the government has not even destroyed one complete strand in the bundle of property rights. The only limit was that cross-complainants could not have indoor or outdoor dining at the restaurant. Cross-complainants can use their property for any other purpose. There is no factual scenario in which such a minor limit on cross-complainants’ rights for the purpose of protecting public health during a pandemic can constitute a taking requiring compensation.

8. Contract Clause

Cross-complainants fail to allege sufficient facts to constitute a violation of either the federal or California Contract Clause. “The threshold inquiry is ‘whether the state law has, in fact, operated as a substantial impairment of a contractual relationship.’ [Citation.]” (Energy Reserves Group, Inc. v. Kansas Power and Light Co. (1983) 459 U.S. 400, 411.) “If the state regulation constitutes a substantial impairment, the State, in justification, must have a significant and legitimate public purpose behind the regulation, [citation] such as the remedying of a broad and general social or economic problem.” (Id. at pp. 411-412.) Finally, the court determines “whether the adjustment of ‘the rights and responsibilities of contracting parties [is based] upon reasonable conditions and [is] of a character appropriate to the public purpose justifying’ ” the impairment of the contract. (Id. at p. 412.) For contracts between private parties, “courts properly defer to legislative judgment as to the necessity and reasonableness of a particular measure.” (U.S. Trust Co. of New York v. New Jersey (1977) 431 U.S. 1, 23.)

The first amended cross-complaint alleges, “The Shutdown Orders and Cross-Defendants’ arbitrary and capricious enforcement of them through Cross-Defendants’ local orders fundamentally upend the contractual bargains struck between Cross-Complainant employers and their employees by effectively terminating contracted-for employment without any recourse for a period of time.” (FACC, 139.)

Assuming the City’s conduct substantially impaired these contractual relationships, the legitimate public purpose is to protect the public from the spread of a deadly virus. The final question, whether that purpose justifies the impairment, is parallel to the rational basis test used for substantive due process and equal protection. Prohibiting in-person dining at restaurants and revoking the restaurant’s conditional use permit for not complying are reasonable means to further that legitimate public purpose.

9. Bane Civil Rights Act

The first amended cross-complaint fails to allege sufficient facts for this cause of action. A violation requires: “(1) intentional interference or attempted interference with a state or federal constitutional or legal right, and (2) the interference or attempted interference was by threats, intimidation or coercion.” (Allen v. City of Sacramento (2015) 234 Cal.App.4th 41, 67.) “The word ‘interferes’ as used in the Bane Act means ‘violates.’ [Citations.] The essence of a Bane Act claim is that the defendant, by the specified improper means (i.e., ‘threats, intimidation or coercion’), tried to or did prevent the plaintiff from doing something he or she had the right to do under the law or to force the plaintiff to do something that he or she was not required to do under the law.” (Austin B. v. Escondido Union School Dist. (2007) 149 Cal.App.4th 860, 883.)

This cause of action fails because cross-complainants do not allege any attempted or completed interference to prevent them from something they had the right to do. The only rights they allege interference with are those in the first eight causes of action—all of which fail on the pleadings. Nothing the City allegedly did prevented cross-complainants from doing anything they had the right to do or required them to do something they were not required to do under the law.

DISPOSITION

Cross-defendants’ demurrer is SUSTAINED with 15 days’ leave to amend.


[1] There is persuasive authority to the contrary. (See Surplus Store and Exchange, Inc. v. City of Delphi (7th Cir. 1991) 928 F.2d 788, 791, fn. 4 [This argument would render meaningless the entire body of precedent… that requires culpability on the part of a municipality and/or its policymakers before the municipality can be held liable under 1983, and would allow municipalities to be nothing more than convenient receptacles of liability for violations caused entirely by state actors”].)



Case Number: *******7923    Hearing Date: March 26, 2021    Dept: 86

CITY OF BURBANK v. BARFLY, INC. et al.

Case Number: *******7923

Hearing Date: March 26, 2021

[Tentative] ORDER GRANTING PRELIMINARY INJUNCTION

[Tentative] ORDER IMPOSING SANCTIONS PURSUANT TO CODE OF CIVIL PROCEDURE SECTION 177.5


Plaintiff, the City of Burbank (City),[1] moves for a preliminary injunction enjoining Defendants, Barfly, Inc., Baret Lepejian, Lucas Lepejian, Talya Lepejian and Isabelle Lepejian, from serving any customers or patrons at Tin Horn Flats Saloon/Bar & Grill (Tin Horn Flats), located at 2623 West Magnolia Boulevard in the City until Defendants obtain all valid and legally required permits to operate Tin Horn Flats.[2]

In addition, on March 12 and then again on March 16, 2021, at ex parte hearings, the court ordered Barfly to show cause why it should not be sanctioned for violating the TRO pursuant to Code of Civil Procedure section 177.5. Thus, two orders to show cause re sanctions are before the court for hearing.

Barfly opposes the City’s request for a preliminary injunction. Barfly also opposes any imposition of sanctions.

Barfly filed two briefs on the issues before the court. The first brief (consisting of three pages), as the court reads it, is in the nature of an objection to the proceedings in their entirety. Barfly posits the court’s initial TRO “is illegal,” the court’s March 12 and March 16 orders were “illegal and unconstitutional,” the City’s actions have deprived “its citizens’ procedural and substantive due process rights,” and the City engaged in “gamesmanship” in which this court has participated “unwillingly” or “unknowingly.” Barfly asserts the City’s actions: “violate procedural due process, substantive due process, the First Amendment right to assembly and association, and the takings clause of the Fifth and Fourteenth Amendments to the U.S. Constitution.” (9:51 a.m. Opposition.)

Barfly’s second brief is a fulsome opposition. The City contends the court should disregard Barfly’s second brief for reasons that are not entirely clear to the court. It appears the City contends Barfly’s first brief (with no legal citations, authorities or any direct reference to the underlying facts/allegations) constitutes Barfly’s opposition. The City also may contend Barfly’s second brief was untimely as it was filed four minutes later than the court’s deadline. While Barfly’s two brief opposition is unusual, the court cannot find Barfly’s second brief should be disregarded.

The individual defendants have not filed any opposition to the City’s request.[3]

Importantly, Barfly has submitted no evidence in support of its opposition. It has submitted argument only.[4]

The City’s request for a preliminary injunction is GRANTED against Barfly only. The City’s request for court authority to employ additional enforcement mechanisms is denied.

The court imposes sanctions pursuant to Code of Civil Procedure section 177.5 upon Barfly for violations of its prior orders.

The City’s RJNs are granted.

Preliminary Injunction

LEGAL STANDARD

The standards governing a preliminary injunction are well known. “[A] court will deny a preliminary injunction unless there is a reasonable probability that the plaintiff will be successful on the merits, but the granting of a preliminary injunction does not amount to an adjudication of the merits.” (Beehan v. Lido Isle Community Assn. (1977) 70 Cal.App.3d 858, 866.) “The function of a preliminary injunction is the preservation of the status quo until a final determination of the merits.” (Ibid.)

As the parties recognize, “Trial courts traditionally consider and weigh two factors in determining whether to issue a preliminary injunction. They are (1) how likely it is that the moving party will prevail on the merits, and (2) the relative harm the parties will suffer in the interim due to the issuance or nonissuance of the injunction.” (Dodge, Warren & Peters Ins. Services, Inc. v. Riley (2003) 105 Cal.App.4th 1414, 1420.) “[T]he greater the ... showing on one, the less must be shown on the other to support an injunction.” (Ibid. [quoting Butt v. State of California, (1992) 4 Cal.4th 668, 678].) The burden of proof is on the plaintiff as the moving party “to show all elements necessary to support issuance of a preliminary injunction.” (O'Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1481.)

Preliminary injunctive relief requires the use of competent evidence to create a sufficient factual showing on the grounds for relief. (See e.g., Ancora-Citronelle Corp. v. Green (1974) 41 Cal.App.3d 146, 150.) A plaintiff seeking injunctive relief must also show the absence of adequate damages remedy at law. (Code Civ. Proc. ; 526, subd. (a)(4).)

A preliminary injunction ordinarily cannot take effect unless and until the plaintiff provides an undertaking for damages which the enjoined defendant may sustain by reason of the injunction if the court finally decides that the plaintiff was not entitled to the injunction. (See Code Civ. Proc. ; 529, subd. (a); City of South San Francisco v. Cypress Lawn Cemetery Ass’n. (1992) 11 Cal. App. 4th 916, 920.) A municipality that obtains a preliminary injunction, however, is not required to post an undertaking.

ANALYSIS

The City’s complaint alleges three causes of action—violation of Burbank Municipal Code (BMC) section 4-1-101-1 (8.04.932), violation of BMC section 10-1-501 and abatement of a public nuisance. The City asserts all three causes of action against all Defendants.

BMC section 4-1-101-1 (8.04.932), alleged in the complaint’s first cause of action, provides:

“No person shall engage in, conduct, manage or carry on any business or other activity for which a license or permit is required by this chapter [concerning public health licenses] . . . [i]f such license or permit has expired, been suspended, revoked, or denied.” (3/3/21 City’s RJN Ex. 1 [BMC ; 4-1-101].)

BMC sections 10-1-501 and 10-1-502, alleged in the complaint’s second cause of action, provide “restaurant/drinking establishments” within the “MPC-3 Magnolia Park General Business” zone are required to hold a conditional use permit (CUP) to operate within the City. (3/3/21 Prescott Decl., ¶ 12; City RJN Ex. 1 [BMC ; 10-1-501].)

The BMC also requires full restaurant service without alcohol to hold an administrative use permit (AUP). (3/3/21 Prescott Decl., ¶ 12; City RJN Ex. 4 [BMC ; 10-1-502].).)

BMC section 1-1-108, alleged in the complaint’s third cause of action, provides “any condition caused or permitted to exist in violation of any provisions of [the BMC] shall be deemed a public nuisance and may be, by this City, summarily abated as such . . . .” (3/3/21 City’s RJN, Ex. 5 [BMC ; 1-1-108].) Similarly, the BMC provides that “[a]ny property, building or structure used . . . in violation of the Zoning Ordinance is declared to be a public nuisance.” (3/3/21 City’s RJN, Ex. 5 [BMC ; 10-1-409].)

Likelihood of Success on the Merits:

Barfly owns and operates Tin Horn Flats, a restaurant/drinking establishment located in the City within the “MPC-3 Magnolia Park General Business” zone in the City. (3/3/21 City’s RJN Ex. 10; 3/3/21 Prescott Decl., ¶ 12.) The City originally approved Barfly’s CUP to operate Tin Horn Flats with 35 conditions of approval in June 2011. Barfly is required to comply with all of the conditions attached to the CUP to lawfully operate Tin Horn Flats. (3/3/21 Prescott Decl., ¶ 13, Ex. 1.)

CUP condition 31 requires Barfly to comply with all federal, state and local laws. The condition admonishes: “Violation or conviction of any of those laws in connection with the use will be cause for revocation of the permit.” (3/3/21 Prescott Decl. ¶ 14, Ex. 1.) CUP condition 32 provides the CUP “may be modified or revoked by the City should it be determined that the use or conditions under which they were permitted are detrimental to public health, welfare, or materially injurious to property or improvements in the vicinity or if the use is maintained so as to constitute a public nuisance.” (3/3/21 Prescott Decl. ¶ 14, Ex. 1.)

On December 10, 2020, inspectors from the Los Angeles County Department of Public Health (DPH) inspected Tin Horn Flats and found Barfly was operating the restaurant illegally and in violation of the County Health Officer’s order concerning COVID-19 (County Health Order). (3/3/21 McShane Decl., ¶¶ 3, 8-11, Exs. 1-3.) The DPH made similar inspections and repeated violation findings between December 12, 2020 and January 24, 2021. (3/3/21 McShane Decl. ¶¶ 12-39, Exs. 4-24; 3/3/21 Midtlyng Decl., ¶¶ 8-35 & Exs. 1-21; 3/3/21 Harutyunyan Decl., ¶¶ 8-20 & Exs. 1-9; Grigoryan Decl., ¶¶ 8-19, Exs. 1-9; 3/3/21 Derhartounian Decl., ¶¶ 8- 19, Exs. 1-9; 3/3/21 Ter-Oganesyan Decl., ¶¶ 8-15, Exs. 1-6; 3/3/21 Lindsey Decl., ¶¶ 8-15, Exs. 1-6.)

After an administrative hearing on January 20, 2021, the DPH revoked the County’s public health permit for Tin Horn Flats on January 27, 2021. (Keshishian Decl., ¶ 9, Ex. 1.) Despite Tin Horn Flat’s lack of a public health permit, Barfly has continued its operation of Tin Horn Flats. (Midtlyng Decl. ¶¶ 36-39 & Exs. 22-24; Harutyunyan Decl. ¶¶ 21-28 & Exs. 10-15; 3/3/21 Grigoryan Decl. ¶¶ 20-23 & Exs. 10-12; Derhartounian Decl. ¶¶ 20-23 & Exs. 10-12; 3/3/21 Andreasyan Decl., ¶¶ 8- 11, Exs. 1-3; Midtlyng Supp. Decl. ¶¶ 7-10 & Exs. 1-3; 3/3/21 Supp. Derhartounian ¶¶ 7-10, Exs. 1-2; McShane Supp. Decl. ¶¶ 7-30 & Exs. 1-18.) DPH has issued multiple citations to Barfly and fined it in excess of $28,000; Barfly has neither paid the fines nor appealed any of the citations. (Keshishian Decl., ¶¶ 6-8.)

On January 8, 2021, the City sent Barfly and Defendant Baret Lepejian a notice of violation. The notice advised them the City intended to hold a public hearing on February 22, 2021 to consider revocation, suspension, or modification of Barfly’s CUP (No. 11-0000126). (Prescott Decl. ¶ 16 & Ex. 2.) The notice advised Barfly and Defendant Baret Lepejian of CUP conditions 31 and 32. (Prescott Decl. ¶ 16 & Ex. 2.)

On February 22, 2021, the City Council held a four-and-a-half hour public hearing to consider revocation, suspension, or modification of Barfly’s CUP. (3/3/21 Prescott Decl. ¶ 19; 3/3/21 Frutos Decl. ¶ 5.) At the conclusion of the hearing, the five-member City Council unanimously voted to adopt a resolution to revoke Barfly’s CUP based on its violation of CUP conditions 31 and 32. The City Council also revoked Barfly’s CUP finding Barfly created a public nuisance under BMC section 10-1-1952 (3).[5] (3/3/21 Prescott Decl. ¶ 19; 3/3/21 Frutos Decl. ¶ 5 & Ex. 1.) The City Council’s decision revoking Barfly’s CUP was immediately effective. (3/3/21 Prescott Decl. ¶ 19; 3/3/21 Frutos Decl. ¶ 5, Ex. 1.)

Despite the revocation of both its County public health permit and its CUP after administrative proceedings, Defendants have continued to operate Tin Horn Flats. (McShane Supp. Decl. ¶¶ 27-30 & Exs. 16-18; 3/3/21 Ogle Decl., ¶¶ 5-8.)

Based on the foregoing facts, the City contends it is likely to prevail on the merits of this action because the evidence will show Barfly has been operating its restaurant unlawfully, without a public health permit since December 12, 2020, and without a CUP since February 23, 2021. The City argues Barfly’s actions (and those of the other Defendants who actually operate Tin Horn Flats) are in violation of BMC sections 4-1-101-1 (8.04.932) (first cause of action), 10-1-501 (second cause of action), 1-1-108 and 10-1-409 (third cause of action).

Barfly does not dispute it is operating Tin Horn Flats in violation of the BMC. Barfly also concedes its continues to operate the restaurant to this day without a County-issued public health permit and City-issued CUP. Thus, Barfly acknowledges it is not lawfully operating.

Barfly contends, however, it continues to operate the restaurant “in exercise of its fundamental liberties protected by the United States Constitution.” That is, without regard to state law,[6] the Los Angeles County Code or the BMC, Barfly asserts its operation of Tin Horn Flats is a constitutionally protected fundamental liberty interest. Barfly asserts the administrative actions—the revocation proceedings conducted by the County (as to the public health permit) and the City (as to the CUP)—denied Barfly due process; the permits “were . . . unconstitutionally taken” from Barfly. Therefore, Barfly reasons, “invalidating the alleged ‘per se’ violation” means the City cannot prevail on the merits of its claims. (Opposition 13:10-13.)

As a preliminary matter, assuming Barfly’s collateral attack on the administrative proceedings could properly be considered by the court as a defense to this action, Barfly has submitted no evidence upon which the court could find the County and/or the City denied Barfly due process. Without evidence, Barfly’s constitutional challenge has no traction. It is nothing more than unsupported argument.

Barfly recognizes the County suspended its health permit because Tin Horn Flats provided outdoor dining for customers during a time when such outdoor dining was forbidden by the County Health Order. Barfly acknowledges the City found the violation of the County’s Health Order placed the health and safety of the public at risk. (Opposition 8:5-7.)

Barfly provides its justification for servicing its customers outdoors in violation of the County Health Order—Judge James Chalfant’s December 8, 2021 decision “enjoining the County from enforcing or enacting any County ban on outdoor dining after December 16, 2020, unless and until its public health officers ‘conduct[] an appropriate risk-benefit analysis and articulate it for the public to see.’ ” (County of Los Angeles Department of Public Health v. Superior Court of Los Angeles County [LADPH] (Cal. Ct. App., Mar. 1, 2021, No. B309416) 2021 WL 777699, at *9.) Judge Chalfant issued the order, according to Barfly, because the County’s Health Order “lack[ed] any scientific, rational or logical foundation . . . .” (Opposition 8:8.) Barfly reasons Judge Chalfant’s finding demonstrates Tin Horn Flats did not put the public health and safety at risk, and therefore, the County had insufficient grounds to revoke Barfly’s health permit. (Opposition 8:5-9.)

After DPH suspended Barfly’s heath permit on December 12, 2020, Barfly requested an administrative hearing. Barfly contended it had a valid defense to the County’s suspension of its health permit “on the basis that the Health Order imposing the restaurant shutdowns was unconstitutional or at the very least, its legality was in dispute following Judge Chalfant’s December” 8, 2021 ruling. (Opposition 8:12-14.) The County revoked Barfly’s health permit after a hearing on January 20, 2021.[7]

Barfly’s justification is unpersuasive. First, Judge Chalfant made no ruling on December 8, 2020. Judge Chalfant did not sign an order in the LADPH matter until December 15, 2020. While Judge Chalfant issued a tentative decision and heard argument in LACPH on December 8, at the conclusion of the hearing on December 8, he took the matter under submission. Judge Chalfant did not decide the matter and did not issue his order until December 15, 2020. Thus, the DPH citations issued to Barfly on December 10, December 12 and December 13, 2020 all occurred before Judge Chalfant issued any order. Moreover, on December 18, 2020, the Court of Appeal stayed Judge Chalfant’s order. Thus, as Judge Chalfant did not issue his order until December 15, 2020, Barfly could not have been operating under any confusion on December 10, 12 or 13, 2020. Accordingly, when the County suspended Barfly’s health permit, Barfly had no justification based on Judge Chalfant’s order—the order did not yet exist.

Barfly argues the City’ revocation of its CUP, which prevents it from conducting lawful business in the state—despite other compliance measures Barfly has elected to take to satisfy public health and safety interests—violates its liberty under the California Constitution and constitutes a “taking.” Barfly asserts its fundamental and substantial rights—the right to freely operate a lawful business to earn a living—was stripped away by an unelected bureaucrat, the Acting State Health Officer, without any opportunity for a hearing.

The revocation actions by the County and City are not directly before the court. That is, this action cannot reverse those administrative decisions; this action will not result in an order reinstating Barfly’s County health permit or CUP. To the extent the administrative proceedings of the County or City may have infected this matter or undermine the City’s position on the substance of its claims, Barfly has submitted no evidence upon which this court could evaluate Barfly’s constitutional claims. Thus, Barfly has given the court no evidentiary basis to find either the County or the City violated its due process.

Moreover, based on LADPH, supra, 2021 WL 777699, Barfly’s arguments are not persuasive. Curiously, Barfly has elected not to address LADPH. LADPH rejected similar (if not identical) arguments made by the California Restaurant Association, Inc. and a restaurant, Mark’s Engine Company No. 28 (collectively, the Restaurants), concerning the County’s Health Order’s prohibition on outdoor dining. In LADPH, the plaintiffs/petitioners argued the prohibition on outdoor dining violated substantive due process and equal protection, was an abuse of government emergency powers and violated first amendment rights of assembly. (Id. at *2.)

The Court of Appeal rejected the Restaurants’ challenge. The Court found the Restaurants could not succeed on the merits of their claims because they had not demonstrated the County Health Order was “arbitrary, capricious, or without rational basis.” (Id. at *9.) The Court also specifically rejected the Restaurants’ First Amendment rights of assembly violation claim. (Id. at *10.) The Court noted it was not “unsympathetic to the plight of restaurant owners and their employees, or to those in so many other sectors who have had their livelihoods taken away and personal finances decimated by the pandemic. Far from it.” (Id. at *2.) Nonetheless, the Court recognized the County’s Health Order in the context of the Restaurants’ claims were subject to “modern rational basis review.” (Id. at *5.)

Barfly’s undeveloped “takings” claim fares no better. The “doctrine of necessity” applies where there is an imminent danger and an actual emergency. A taking in the face of actual necessity in an emergency obviates the need for compensation under the takings clause. (United States v. Caltex (Philippines), Inc. (1952) 344 U.S. 149, 154;[8] Bowditch v. City of Boston (1880) 101 U.S. 16, 16-19; see also Patrick v. Riley (1930) 209 Cal. 350, 354.) The City sufficiently argues—given Barfly’s generalized argument—the COVID-19 global pandemic satisfies the “necessity” doctrine.

Barfly also suggests the County’s Health Order limiting restaurant services was made “at the whim of an unelected bureaucrat” which constitutes government overreach by arbitrarily banning Barfly’s right to operate a lawful business. Further, Barfly argues its right to operate its business was “stripped away before any opportunity to a hearing by the unelected bureaucrat, the Acting State Health Officer.”

However, as stated by the United States Supreme Court more than 100 years ago in Jacobson v. Massachusetts (1905) 197 U.S. 11 (relied upon by the Court of Appeal in LADPH), government action that “purport[s] to . . . protect the public health” in an emergency will be upheld, unless it “has no real or substantial relation” to the object of public health or is “beyond all question, a plain, palpable invasion of rights secured by the fundamental law[.]” (Id. at 31; LADPH, supra, 2021 WL 777699, at *4.) Here, like the Restaurants in LADPH, Barfly had the burden of demonstrating that, under the circumstances, the County’s health order was arbitrary, capricious, or without rational basis in order show a probability of prevailing on its due process defenses. With absolutely no evidence submitted to the court and only generalized constitutional legal argument, Barfly has failed to carry its burden on any defense against the City’s claims.

Moreover, even if the court were to credit Barfly’s arguments as having some merit, Barfly’s arguments and showing are insufficient to demonstrate the City has no probability of prevailing on the merits of its claims. As noted earlier, the court today does not make a final determination of the merits of the City’s claims. Instead, the court weighs the relative merits of the parties’ positions (argument and evidence) to consider whether to issue a preliminary injunction—an injunction that will be in effect until trial unless otherwise modified or terminated.

Based on the foregoing on this record, the court finds the City has a strong probability of prevailing on the merits of its claims against Barfly.

Balancing the Harms:

The second part of the preliminary injunction analysis requires the court to evaluate the harm the plaintiff is likely to sustain if the preliminary injunction is denied compared to the harm the defendant is likely to suffer if the injunction is issued. (IT Corp. v. County of Imperial (1983) 35 Cal.3d 63, 69-70.) “However, ‘[a] trial court may not grant a preliminary injunction, regardless of the balance of interim harm, unless there is some possibility that the plaintiff would ultimately prevail on the merits of the claim.’ ” (Law School Admission Council, Inc. v. State of California (2014) 222 Cal.App.4th 1265, 1280 [quoting Butt v. State of California (1992) 4 Cal.4th at 678].)

The City argues a preliminary injunction is necessary to protect the health and safety of its residents and to restore public trust in the local government.

The City submits evidence that a restaurant, such as Tin Horn Flats, operating without a public health permit or CUP has the potential to lead to increased public health hazards and the failure to abide by proper hygienic and sanitary practices and potentially fatal food-borne illnesses. (See Keshishian Decl. ¶¶ 11- 15; see also Prescott Decl., ¶ 9.) With respect to public trust, the City submits evidence Barfly’s actions of publicly ignoring public health orders and permit requirements could erode the public trust in the City’s ability to enforce its laws and have a “detrimental domino effect” encouraging others to similarly disobey established rules and regulations meant to promote public health and safety; enforcement of these rules are necessary to ensure trust in the government’s ability to protect the public and enforce it laws. (Keshishian Decl. ¶¶ 14-15; Frutos Decl. ¶¶ 7-13.)

The City also relies on legal authority establishing “[w]here a public entity seeks an injunction, the trial court presumes the harm to the public outweighs the harm to the defendant if the public entity shows a likelihood of success.” (People ex rel. Brown v. Black Hawk Tobacco, Inc. (2011) 197 Cal.App.4th 1561, 1571.)

In opposition, Barfly suggests it will suffer grave or irreparable harm from the issuance of a preliminary injunction. Barfly fails to offer any specific facts or evidence to substantiate its argument. In reality, any harm Barfly has suffered is related to the loss of its health permit and CUP after administrative hearings. A preliminary injunction in this action merely seeks to ensure Barfly complies with the law. (Of course, the City has submitted evidence suggesting Barfly has no intentions of complying with the law.) A preliminary injunction imposes no new obligations on Barfly.

After considering the arguments and evidence, the court finds the balance of harms clearly weighs in favor of the City.

CONCLUSION

Based on the court’s balance of the City’s likelihood of success on the merits and the parties’ competing harms, the court finds the City is entitled to a preliminary injunction during the pendency of the litigation. Therefore, the request for a preliminary injunction is granted.

The court is inclined, however, to issue the preliminary injunction against Barfly and its agents only. Preliminary injunctive relief as to the individual Defendants appears duplicative and unnecessary given the scope of the preliminary injunction.

Under the circumstances here, the court is also not inclined to “authorize” the City to use additional enforcement mechanisms to preclude Barfly from doing business such as termination of water and natural gas service. Undoubtedly, based on the evidence presented—as with the electrical power—Barfly will merely obtain alternative sources. The premises already operates combustion generators because electrical service has been terminated. (See Tachco Decl., ¶ 2.) The court questions the wisdom of creating a situation where Barfly’s agents add water and propane tanks to the mix. Moreover, the City’s request to barricade the premises, in the court’s view, leads to concerns about emergency responder access and the potential for entrapment. At some point, the City’s suggested enforcement mechanisms present their own public health and safety risk—not only to Barfly and its patrons but to the surrounding neighborhood, as well.

The City has plenty of other non-physical enforcement mechanisms available to it—the court has no evidence of what other enforcement efforts, if any, the City has made since the court issued the TRO. The City does not need another court order providing for more authority.

No bond is required. (Code Civ. Proc. ; 529, subd. (b).)

Code of Civil Procedure section 177.5 Sanctions

On March 8, 2021 the court issued its TRO. The TRO enjoined and prohibited:

“Barfly, Inc., and its agents, employees, representatives, and all persons acting under, in concert with or for it, from operating, being open for business, and/or serving any customers or patrons at Tin Horn Flats . . . until Defendant obtains all valid and legally required permits to operate Tin Horn Flats.” (TRO 3:22-28.)

The City thereafter caused the TRO to be served upon Barfly’s agent for service of process, Defendant Baret Lepejian and Barfly’s counsel the following day.

The following day, March 9, 2021, Juan Carlos Murillo called Tin Horn Flats and “place[d] an order for take out.” (Murillo Decl., ¶ 4.) Murillo then went to the restaurant and “paid the cashier $13.23 in cash.” (Murillo Decl., ¶ 4.) While Murillo waited for his order he “observed over ten customers sitting in the rear patio, all of whom were eating, drinking, and/or ordering food.” (Murillo Decl., ¶ 4.) Murillo observed “two servers and two cooks working behind the

bar . . . .” (Murillo Decl., ¶ 4.) Murillo’s receipt corroborates his purchase of food at Tin Horn Flats on March 9. (Murillo Decl., ¶ 4, Ex. 1.)

On March 12, 2021, based on the evidence Barfly had violated the court’s TRO, at the City’s request, the court set a hearing and ordered Barfly to show cause why it should not be sanctioned pursuant to Code of Civil Procedure section 177.5 for violating the court’s TRO. At the hearing, the court provided Barfly’s counsel with the date to file any opposition to the order to show cause.

Two days later, on March 14, 2021, Michael Tachco went to the restaurant and placed a takeout order. (Tachco Decl., ¶ 2.) A food server took Tachco’s order. (Tachco Decl., ¶ 2.) While Tachco waited for his food, he saw “customers who were in various stages of eating, drinking, and/or ordering.” (Tachco Decl., ¶ 3.) Eventually, “a server brought [his] takeout order to [him], along with a receipt for [his] order.” (Tachco Decl., ¶ 4.) Tachco paid for the food and left Tin Horn Flats. (Tachco Decl., ¶ 4.) Like Murillo, Tachco obtained a receipt showing his purchase. (Tachco Decl., ¶ 4, Ex. 1.)

On March 16, 2021, based on the evidence Barfly had again violated the court’s TRO, at the City’s request, the court set a hearing and ordered Barfly to show cause why it should not be sanctioned pursuant to Code of Civil Procedure section 177.5 for violating the court’s TRO. At the hearing, the court provided Barfly’s counsel with the date to file any opposition to the order to show cause.

Based on the evidence, it is clear Barfly violated the court’s TRO by “serving . . . customers or patrons at Tin Horn Flats” without “all valid and legally required permits to operate Tin Horn Flats.” (TRO 3:25-28.)

Code of Civil Procedure section 177.5  is intended to “punish and deter violations of lawful court orders [citation], and to compensate the judicial system for the cost of unnecessary hearings.” (People v. Landers (2019) 31 Cal.App.5th, 288, 303.) The statute “does not require that the offending act be ‘willful,’ but only that it be committed without good cause or substantial justification” that is, “without a valid excuse.” (People v. Muhammad (2003) 108 Cal.App.4th 313, 324; People v. Kareem A. (2020) 46 Cal.App.5th 58, 78.)

“The ‘imposition of sanctions, monetary or otherwise, is within the discretion of the trial court. That discretion must be exercised in a reasonable manner with one of the statutorily authorized purposes in mind and must be guided by existing legal standards as adapted to current circumstances.’” (In re Woodham (2001) 95 Cal.App.4th 438, 443; In re Marriage of Eustice (2015) 242 Cal.App.4th 1291, 1309. [“The trial court has broad discretion to impose sanctions for violations of court orders . . . subject to reversal only for arbitrary or capricious action.”].)

Barfly admits “it continued its business operations in light of the Court’s orders” but argues it was justified in doing so. (Opposition 17:5-7.) Barfly contends the County’s Health Order is “an illegal health order” and it was deprived “of procedural due process in challenging its permit revocations.” (Opposition 17:9-10.)

Given the Court of Appeal’s decision in LADPH, supra, 2021 WL 777699, filed March 3, 2021—five days before this court issued its TRO—the court rejects Barfly’s claim it was substantially justified based on an “illegal health order.” The court also cannot find on this record the administrative proceedings before the County or City violated its procedural due process.

The court finds when Barfly violated the TRO, it did so without good cause or substantial justification.

Based on Barfly’s violation of the TRO on March 9, 2021, the court imposes a sanction of $500 on Barfly payable to the court within 30 days.

Based on Barfly’s violation of the TRO on March 14, 2021, the court imposes a sanction of $650 on Barfly payable to the court within 30 days.

CONCLUSION

Based on the foregoing, Barfly shall pay to the court as and for sanctions pursuant to Code of Civil Procedure section 177.5 a total of $1,150 within 30 days.

IT IS SO ORDERED.

March 26, 2021 ________________________________

Hon. Mitchell Beckloff

Judge of the Superior Court


[1] There are three Plaintiffs in this action—the City, the People of the State of California and the City’s Attorney, Amelia Ann Albano. For ease of reference, the court refers to all Plaintiffs as the City.

[2] The City also requests additional relief related to enforcement. After the court issued its Order Granting Plaintiffs’ Ex Parte Application for Temporary Restraining Order and Order to Show Cause Re Preliminary Injunction (TRO) on March 8, 2021 against Barfly, the City twice requested modifications of the TRO—an order authorizing the City to terminate Barfly’s electrical service and an order allowing the City to padlock Barfly’s doors. The court ordered the requested modifications. In reply, the City seeks additional orders from the court to assist it with enforcement of any preliminary injunction ordered.

[3] Defendant Baret Lepejian is the President and Chief Executive Officer of Barfly. (3/3/21 City’s Request for Judicial Notice (RJN), Ex. 10.) Defendant Isabelle Lepejian is the record title owner of the property where Tin Horn Flats is located. (3/3/21 City’s RJN, Ex. 11.) Defendants Lucas Lepejian and Talya Lepejian are the children of Baret Lepejian and they hold themselves out to be owners, managers, employees, and/or agents for Tin Horn Flats. (3/3/21 Lee Decl., Exs. 1, 2, 8, 13, 31, 32.) These facts are undisputed.

[4] At 2:27 p.m., the day before the hearing in this matter, Barfly filed a declaration from one of its counsel on the status of an administrative appeal of the County’s revocation of its public health permit. The court elects to disregard the late filed evidence.

[5] The City Council’s resolution found Tin Horn Flat’s ongoing operation without a public health permit was “detrimental to the public health and welfare, [was] materially injurious to the property and to the adjacent neighborhood, and thus constitutes a public nuisance and justification for the revocation of Tin Horn Flats [CUP] under” the BMC. (3/3/21 Frutos Decl. ¶ 5, Ex. 1.)

[6] Health and Safety Code section 114381, subdivision (a) provides: “A food facility shall not be open for business without a valid permit.”

[7] Barfly concedes it has not administratively challenged the City’s decision to revoke its CUP. The City “claims that Barfly did not appeal or provide a response before the City of Burbank held a public permit revocation hearing in regard to Tin Horn’s CUP and as such, was provided an adequate opportunity to be heard. However, it was made abundantly clear that any efforts by Barfly to receive a fair, neutral hearing would be futile, and thus, was denied due process whether they appealed or sent a response pre-hearing.” (Opposition 13:14-18.) The court has no evidence upon which to judge Barfly’s claims of an unfair administrative proceeding.

[8] In United States v. Caltex (1952) 344 U.S. 149, compensation under the Takings Clause was denied for an oil terminal facility in Manila that the United States Army destroyed immediately prior to the Japanese invasion of the Philippine Islands to deprive the enemy “of a valuable logistic weapon.” (Id. at p. 151.)



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