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Icky Rottens Investment Group, Inc., A California Corporation v. City of Coronado

November 27, 2012


The opinion of the court was delivered by: Jeffrey T. Miller United U United States District District Judge States Judge



Plaintiff Nicky Rottens Investment Group ("NRIG") filed a complaint against the City of Coronado (the "City") and City Manager Blair King (together "Defendants") on September 4, 2012 alleging that Coronado violated its constitutional rights to equal protection under the Fourteenth Amendment and substantive due process under the Fifth Amendment. NRIG filed this action in federal court under 42 U.S.C. § 1983, the Federal Civil Rights Act. Defendants now move to dismiss NRIG's complaint for failure to state a claim. For the reasons that follow, this court grants the Defendants' motion to dismiss NRIG's complaint with leave to amend as set forth below.


A. The Permits

Around July 2010, NRIG purchased a real property located at 100-104 Orange Avenue, Coronado, California 92118 (the "premises"). Compl. ¶ 3. The premises previously consisted of a blighted bar named "Island Sports" and a Laundromat. Id. ¶ 8. NRIG wanted to convert the premises into "a world-class, family-friendly, neighborhood [r]estaurant which caters to and serves the residents, guests and tourists of the City of Coronado, San Diego County, California, the United States, and the world" (the "Restaurant"). Id. ¶ 11.

To achieve this vision, in September 2010, NRIG submitted applications to the City for an Encroachment Permit, which would allow NRIG to install railings defining an outdoor dining area, and a Use of City Property for Commercial Activity Permit ("Commercial Use Permit"), which would permit NRIG to use the outdoor area to serve food and drinks (together the "Permits"). Id. ¶ 5. Along with the premises, NRIG also purchased the Island Sports' liquor type "48" license, which it sought to downgrade to a type "47" license that would permit it to serve families and minors in the same establishment.1 Id. ¶ 4.

Prior to the City Council's requisite meeting to approve the permits, NRIG met with nearby condominium complex residents to discuss any concerns based on previous problems with Island Sports. Id. ¶ 23. NRIG claims that it "agreed to consider the homeowners' association's speculative concerns about the alleged impact that the Restaurant might possibly have on the neighborhood." Id.

At its January 18, 2011 meeting, the City Council took up NRIG's application for the Permits, along with three similar Encroachment Permit applications submitted by Saiko Sushi ("Saiko"), Sapori, and Coronado Firehouse Restaurant ("Coronado Firehouse"). Id. ¶ 18.

Establishments with type "48" licenses may not permit minors to enter the premises.

Saiko, Sapori, and Coronado Firehouse are similar to the Restaurant, include full bar service, and were already operating at the time of this hearing. Id. The Restaurant was not yet in operation. Id. ¶ 27. Saiko and Sapori had previously been granted temporary Encroachment Permits in December 2009. Coronado Firehouse had also previously been granted a temporary Encroachment Permit in June 2010. Id. All had previously received these Encroachment Permits subject to annual review. Id. ¶ 36. The City Council granted these establishments renewed permits for twelve months without imposing any conditions at the meeting. Id. ¶ 27. To date, the City has not placed any conditions on permits issued to Saiko, Sapori, Coronado Firehouse, or three other restaurants located in the immediate vicinity.2 Id. ¶ 15.

NRIG's approval process did not go nearly as smoothly. At this meeting, the City's Director of Engineering and Project Development, Ed Walton, brought forth a list of the nearby condominium complex residents' concerns that NRIG had agreed to consider and a list of conditions to address these concerns.3 Id. ¶ 25. Coronado resident Marilyn Field had drafted both lists and emailed them to the City. Id. Walton inserted most of Field's recommendations

The other restaurants are: The Little Club located at 132 Orange Avenue; Coronado Brewing Company located at 170 Orange Avenue; and Tartine located across the street from the Restaurant at 1106 1st Street. Compl. ¶ 15.

These concessions include:

1. Triple pane noise controlling windows and skylight closed.

2. Outdoor diner will close at 10:00 p.m. and the windows will be closed.

3. Last call for drinks will be well in advance of 1:30 a.m. with patrons leaving the bar before 2 a.m.

4. Security guard patrolling the surrounding area from 10:00 p.m. until after closing.

5. Outside smoking to be limited to small area on South end of patio.

6. Trash, garbage, and bottle collection system to be indoors in a ventilated room and the trash will be picked up by Waste Management. No trash outside on street.

7. No sports TVs outside.

8. Indoor sports TVs shall be positioned away from patio dining and shall not be audible on the patio. Windows [are] to be ...

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