FOR THE EIGHTH CIRCUIT
Frank J. Steinhauser, III, et al.,
Appellants,
v.
City of St. Paul, et al.,
Appellees.
Sandra Harrilal, et al.,
Appellants,
v.
Steve Magner, et al.,
Appellees.
Thomas J. Gallagher, et al.,
Appellants,
v.
Steve Magner, et al.,
Appellees.
An Appeal from the United States District Court
for the District of Minnesota in Civil File Nos. 0:04-cv-02632 JNE/SRN;
0:05-cv-00461 JNE/SRN and 0:05-cv-01348 JNE/SRN
________________________________
APPELLEES’ BRIEF
_____________________________
JOHN J. CHOI
Saint Paul City Attorney
LOUISE TOSCANO SEEBA (#292047)
Assistant City Attorney
750 City Hall and Courthouse
15 West Kellogg Boulevard
St. Paul, MN 55102
(651) 266-8770
Attorneys for Appellees
STATEMENT OF THE CASE
These are civil cases alleging numerous causes of action: The federal Fair
Housing Act, the RICO Act, federal antitrust laws, 42 U.S.C. §§ 1981, 1982, 1983,
1985, and various state law causes of action. The Steinhauser Appellants filed
their lawsuit on May 5, 2004. The Harrilal Appellants filed their lawsuit on March
3, 2005. The Gallagher Appellants filed their lawsuit on July 6, 2005.
(Hereinafter, the Landowners). All three cases were filed in the United States
District Court in the District of Minnesota and were assigned to Judge Joan N.
Ericksen and referred to Magistrate Judge Susan Richard Nelson. The cases were
consolidated, and throughout the litigation all motions were identical, heard on the
same date, and issued the same orders.
On June 15, 2007, the Landowners wrote an informal letter brief to
Magistrate Nelson requesting that the City1 be compelled to disclose employee
Magner’s personal records (tax filings, bank statements, and personal cell phone
records). On July 16, 2007, Magistrate Nelson denied the Landowners’ motion.
Brief continued said... Appellees have used “City” to designate 1 all Defendants: the City, Mayor, and City employees, unless otherwise noted.
The Landowners filed objections to the Magistrate’s Order. Judge Ericksen affirmed Magistrate Nelson’s denial of the Landowners’ motion to compel and
entered judgment on August 20, 2007.
On June 20, 2007, the Landowners filed a motion for sanctions against the City. On November 13, 2007, Magistrate Nelson denied the Landowners’ motion for sanctions. The Landowners filed objections to the Magistrate’s Order. Judge
Ericksen affirmed that ruling and entered judgment denying the Landowners’ motion for sanctions on January 3, 2008.
On February 25, 2008, the Landowners filed a renewed motion for sanctions against the City. On April 23, 2008, Magistrate Nelson denied the Landowners’ renewed motion for sanctions. An amended order denying the Landowners’
renewed motion for sanctions was signed by Magistrate Nelson on May 8, 2008.
The Landowners filed objections to the Magistrate’s Order. Judge Ericksen affirmed Magistrate Nelson’s denial of Landowners’ renewed motion for sanctions
and entered judgment on June 12, 2008.
On March 11, 2008, the City filed a motion for summary judgment. The
motion was continued until the Landowners’ renewed motion for sanctions was
decided. On September 12, 2008, the district court heard the City’s motion for summary judgment. In a fifty-three-page, December 18, 2008, Order, the district court granted the City’s motion for summary judgment.
The Landowners appeal the district court’s Orders affirming the Magistrate Judge’s rulings on their motion to compel, motion for sanctions, and renewed
motion for sanctions. The Landowners also seek review of the district court’s
Order granting the City’s motion for summary judgment.
STATEMENT OF FACTS
I. CITY OF ST. PAUL HOUSING CODE AND ENFORCEMENT OF
THE CODE
Chapter 34 of the St. Paul Legislative Code (housing code) sets forth the
minimum property maintenance standards for all structures occupied or intended
to be occupied for residential purposes in the City. St. Paul, Minn., Code §§
34.01, 34.03 (1993). APP 001190-001191. The stated purpose of the housing code is to “protect the public health, safety and welfare in all structures and on all
premises.” Id. § 34.01. It “[e]stablishes minimum maintenance standards for all structures and premises for basic equipment and facilities for light, ventilation,
heating and sanitation; for safety from fire; for crime prevention; for space, use and location; and for safe and sanitary maintenance of all structures and
premises.” Id.
Brief continued said... In 2003, the City established DNHPI (Department of Neighborhood
Housing and Property Improvement) as an executive department responsible for
administering and enforcing the housing code. A 1-4.2 Randy Kelly, who was the Mayor at the time, appointed Andy Dawkins as the director of DNHPI. A 10. The
responsibilities of DNHPI included inspecting all buildings and properties as
required by the City codes; administering and enforcing laws regulating the
maintenance of residential property, including the City’s vacant building program
and the City’s rental registration program; and enforcing violations of the City’s
codes related to property maintenance. A 4. According to the DNHPI website,
DNHPI’s mission was to “keep the city clean, keep its housing habitable, and
make [its] neighborhoods the safest and most livable [of] anywhere in Minnesota.”
A 17. The DNHPI website identified closing down “problem properties” as one of
DNHPI’s priorities. Id. The DNHPI website described a “problem property” as
“[i]f you live next door to a problem property[,] you know it!” A 18. “Constant
calls to get rid of the junk, intolerable behavior by occupants, and guests, etc.” Id.
Problem properties included both rental and owner-occupied properties. Id.
During Dawkins’s tenure as Director, DNHPI enforced the housing code by
conducting proactive sweeps requested by City District Councils and responding
to citizen complaints. A 8, 9, 12, 14. According to the DNHPI website, to
respond to a citizen complaint, a housing inspector visited the subject property and
determined if a violation existed. A 20. If the complaint was founded, DNHPI
mailed a correction or an abatement order to the occupant and the property owner.
Dawkins created written rules and procedures for DNHPI, which were
publicly available from the DNHPI website. APP 001179-001188. These rules
stated that DNHPI’s goal was consistent application of the rules, but noted that
“universal application of the housing code” was not possible due to DNHPI’s
limited resources. APP 001180. Housing inspectors, therefore, had discretion in
their application of the rules, in their prioritization of cases, to determine which
problems received the closest scrutiny, and to achieve compliance through a
conversation with the property owner rather than issuing a work order or
misdemeanor tag. Id. To aid housing inspectors in exercising their discretion the
rules established the following priorities: serious health and safety cases, problem
properties, garbage and nuisance violations, falling down/dilapidated structures,
interior habitability cases, and structures with multiple violations. Id.
Brief continued said... Enforcement tools available to housing inspectors included orders to correct
or abate conditions, condemnation and vacant building registration, criminal
charges, and fees for excessive consumption of City services. A 19. In addition,
rental properties were subject to revocation of rental registration, evictions
initiated by the City Attorney, and City-initiated Tenant Remedies Actions
pursuant to Minn. Stat. § 504B.395, subd. 1(4) (2006). Id. At times, properties
not in compliance with the housing code were required to undergo a “code
compliance” inspection by the City’s Office of License, Inspections, and
7
Environmental Protection, which would evaluate the building’s structure,
plumbing, electrical condition, and mechanical condition. A 24-27.
A. Saint Paul Public Housing Agency
The St. Paul Public Housing Agency (PHA), a governmental entity separate
and distinct from the City, owns and manages 4300 units of public housing in the
City. A 30, 64. The United States Department of Housing and Urban
Development (HUD) funds PHA’s public housing program through an operating
subsidy and capital improvement funds. A 30-31. PHA’s public housing includes
high-rise properties, family townhome developments, and scattered site properties,
which are single family or duplex properties located throughout the City. A 29,
35. The Landowners claim these scattered site properties are similar to their rental
properties. Steinhauser Third Amended Complaint ¶ 26; Harrilal Third Amended
Complaint ¶ 26; Gallagher Second Amended Complaint ¶ 28. According to PHA
documents, the scattered site properties’ tenant base is about 32% African-
American and 58% Asian/Pacific Islander. A 66.
PHA also operates the Section 8/Housing Choice Voucher program (HCV
program) for the City. A 31. HUD funds the HCV program. Id. PHA pays HCV
program funds directly to Landowners on behalf of households participating in the
HCV program. Id.
Brief continued said... According to Jon Gutzmann, Executive Director of PHA, there is a shortage
of affordable housing in the City. A 40-41. About 6000 households are on the
waiting list for PHA public housing. A 41. Approximately 3000 households are
on the HCV program’s waiting list, which is closed. A 42-43. Although the
record does not reflect the demographic breakdown for the City, it is undisputed
that non-whites make up a disproportionate percentage of these waiting lists.
Gallagher ADD 000006.
PHA properties are subject to the federal Uniform Physical Condition
Standard (UPCS). A 45, 50-51. Properties owned by PHA also are subject to the
City’s codes, including the housing code. A 44, 52, 59, 64. According to Henry
Petro, Director of Maintenance for PHA, the City sends code enforcement orders
to a single contact person at PHA, who then forwards the order to the appropriate
PHA department. A 69-70. City housing inspectors have ordered repairs on PHA
homes, primarily for exterior deficiencies. A 73. The City rarely, if ever,
condemns a PHA scattered site property, declares a PHA scattered site property a
vacant building, or subjects a PHA scattered site property to a code compliance
inspection. A 61-63, 71-72, 74-75. The City has, however, condemned nonscattered
site PHA properties, including apartments in PHA high-rises. A 71.
HUD inspects a subset of PHA properties every two years. A 53-54. HUD
consistently rates PHA as a “high performer” in overall operations. A 76-82.
9
Between 2002 and 2005, PHA received scores between 88% and 90% for the
physical condition of its properties. A 79, 82. A score over 80% results in HUD
inspecting PHA properties every other year rather than every year. A 53-54.
In addition to undergoing HUD inspections, PHA properties are subject to
frequent inspections by the PHA itself. A 46. According to Al Hester, Housing
Policy Director for PHA, every PHA unit is subject to an annual preventative
maintenance inspection and an annual housekeeping inspection. A 55, 56-57.
PHA conducts yard-care and building-condition inspections of its scattered site
properties five times a year. A 47. PHA also conducts pest-control inspections of
its properties. A 58. Petro testified that PHA’s maintenance department employs
ninety-eight people. A 68. Seventy-seven of the maintenance department
employees are maintenance line workers. Id. PHA documents indicate that in
2002, PHA completed 28,577 non-emergency work orders and 6,573 emergency
work orders. A 84. PHA makes routine repairs in approximately 3.6 days and
emergency repairs within 24 hours. Id. In the last couple of years the PHA has
sold 18 of its scattered site housing units to raise funds necessary for capital
improvements on the other housing units in its portfolio. A 36-39.
Private-sector properties rented to HCV program tenants must meet the
federal Housing Quality Standards (HQS) set forth in 24 C.F.R. § 982.401 (2008),
as well as the City’s housing code. According to Hester, the HQS is a lower
Brief continued said... standard than the UPCS. A 51. In 1995, the City Fire Department compared the
City’s housing code to the HQS and concluded that the housing code was stricter
than the HQS for seventy-seven of the ninety-four items compared, or 82% of the
items. APP 000109. The housing code was as strict as the HQS for twelve items,
and the housing code was less strict than the HQS for three items. Id.
B. Landowners
The Landowners are current or former owners of residential rental
properties in the City. Of the sixteen Landowners, three are non-whites. Harrilal
Third Amended Complaint ¶ 92. The Landowners describe Sandra Harrilal as
“Black American” and Bee and Lamena Vue as Asian-American.3 Id. ¶ 92, ¶ 94.
According to the Landowners, a majority of their tenant base is African-American.
APP 000118, 000136, 000461, 000659, 000829, 000838.
Throughout their Complaints, the Landowners allege the City committed
multiple acts of wrongdoing. See generally, Steinhauser Third Amended
Complaint; Harrilal Third Amended Complaint, Gallagher Second Amended
Complaint. They challenge the legitimacy of code enforcement orders they
received and claim that neighboring properties also had code violations but did not
receive code enforcement orders. Id. They claim City housing inspectors and law
enforcement personnel conducted unconstitutional searches or inspections of their
11
rental properties. Id. The Landowners challenge the designation of certain
properties as vacant buildings and the legality of code compliance inspections. Id.
They contend that PHA received preferential treatment from the City with respect
to housing code enforcement while the City took a “heavy enforcement” and “code
to the max” approach with the Landowners. Id. In addition, they claim the City
targeted them for code enforcement because they rented to protected classes. Id.
Finally, the Landowners claim the City intentionally delayed mailings or
intentionally sent mailings containing code enforcement orders to wrong addresses
to prevent them from responding before a deadline expired. Id.
C. Landowners’ Statement of Facts
The Landowners’ statement of facts is rife with misstatements, taking
testimony out of context, recitation of irrelevant facts, and blatant disregard of the
actual facts. For example, in Gallagher’s and Steinhauser/Harrilal’s briefs they
continuously claim the phrases “force ownership change strategy” and “eviction
strategy” are evidence of discrimination. Gallagher Br. and Steinhauser/Harrilal
Br. throughout. The Landowners simply string these phrases together from Andy
Dawkins’ deposition exhibits (his handwritten notes) and pass them off as a
strategy of discrimination. It is particularly troubling that the Landowners skip the
portion of Andy Dawkins’ deposition where he explains what his handwritten
notes regarding these phrases mean. Gallagher ADD 000086 and 000087 skipping
Brief continued said... pages 562, 563, 564 and 565 of Dawkins’ deposition. In his deposition, while
going through his handwritten notes, Dawkins explained that ‘the force
responsible ownership strategy I have said several times was to make sure that we
stay with the property, to either get the property owner to get it into compliance, or
get the property owner to sell the property to someone who could get the property
into compliance.” A 15. The “eviction strategy” that the Landowners claim is
evidence of discrimination is the Minnesota law that allows a landlord who is
intimidated by a particular problem tenant to assign the eviction to the City. A 6-
7, 13. The “force responsible ownership change strategy” is not evidence of
discrimination, but rather efforts by the City to make sure that landlords are
responsible owners who keep their properties in safe condition for renters. The
“eviction strategy” is merely a law that allows landlords who need help evicting
problem tenants the ability to assign those evictions to the City. The Landowners
throughout their brief continue to use the terms “force ownership change strategy”
and “eviction strategy” as evidence of discrimination. The facts do not support
this and nothing could be further from the truth.
The Landowners also ignore Dawkins’ explanation that code enforcement
must be “consistent” and, in contradiction to this, claim that code enforcement was
inconsistent. Gallagher Br. pp. 7, 8. The Landowners take issue with factual
bulletins that simply reiterate the law. See Gallagher Br. pp. 9, 17 and 18 (an
13
administrative search warrant could lead to a condemnation, civil law has a lower
standard of proof then criminal law). The Landowners also cite a number of
deposition transcripts that have absolutely nothing to do with race. See e.g.,
Gallagher Br. pp. 10, 11.
With regard to testimony of code inspection officer Steve Schiller, Schiller
stated he was told to do a thorough inspection and that the orders that he wrote up
are only unfair from the standpoint that the homeowner was in very poor health.
Gallagher Br. p. 13. There is absolutely no evidence that code enforcement had
anything to do with anything other than the condition of the property.
The Landowners continue to cite documents that do not assist their
argument and are taken completely out of context. For example, the Landowners
cite an email wherein Jane Prince alleges that a neighbor may be using the
complaint-based system unfairly. See Gallagher Br. p. 15. There is no evidence
that the City was using the code enforcement unfairly which is the heart of the
Landowners’ allegations. Likewise, the Landowners cite a Dawkins’ memo which
he circulated to brainstorm with his department on how any parts of City
government may be susceptible to racism and unfair practices and what they could
do to fix it. APP 000008. The Landowners, in an amazing twist and complete
contradiction to the memo, rely on it in order to support their arguments that the
Brief continued said... City was condoning actions that would negatively affect minorities. See Gallagher
Br. p. 16.
The Landowners improperly state that Dean Koehnen was sent out to a
property because of his size. See Gallagher Br. p. 19. The email correspondence
Landowners cite clearly states that “The latest update might involve code.
Apparently the dogs at the property have been pooping on the main floor porch
which is raised off the back at the address and garbage has been piling up in the
yard.” APP 000016. As the email correspondence states, but Gallagher
Landowners completely ignore, this information involves code enforcement and
that is why it was forwarded to code enforcement. Furthermore, there is no
evidence that Dean Koehnen was ever used to intimidate anyone. To support this
allegation the Landowners rely on an email regarding someone named “Pam” in
Crime Prevention who allegedly said something to code enforcement officer
Jackie Girling. Ms. Girling then stated in an email that what Pam said sounded to
Girling like Pam was hoping that Koehnen could strong arm someone. Gallagher
Br. p. 19. At best this is hearsay from someone named Pam who was never
identified and never deposed. Likewise, Girling was never deposed. Furthermore,
that Pam hoped Koehnen would strong-arm someone is not evidence that Koehnen
actually did.
15
The Landowners rely on the opinion of the expert Don Hedquist that
Defendants were in violation of State law in removing grandfathering protections
for existing building through the “Code Compliance Certification process” in
support of their argument that the district court erred when it granted the City
summary judgment. Steinhauser Br. pp. 7-8, 35. A district court performs the
same role at the summary judgment phase as at trial; “an expert’s report is not
talisman against summary judgment.” Raskin v. Wyatt Co., 125 F.3d 55, 66 (2d
Cir. 1997). The district court functions as a gatekeeper who “separates expert
opinion evidence based on ‘good grounds’ from subjective speculation that
masquerades as scientific knowledge.” Presley v. Lakewood Eng’g & Mfg. Co.,
553 F.3d 638 (8th Cir. 2009) (quoting Glastetter v. Novartis Pharm. Corp., 252
F.3d 986, 989 (8th Cir. 2001)).
Even on a motion for summary judgment, “an expert’s opinion is not a
substitute for a plaintiff's obligation to provide evidence of facts that support the
applicability of the expert's opinion to the case.” Concord Boat Corp. v.
Brunswick Corp., 207 F.3d 1039, 1057 (8th Cir. 2000) (quoting Virgin Atl.
Airways Ltd. v. British Airways PLC, 69 F. Supp. 2d 571, 580 (S.D.N.Y. 1999)).
Speculative expert testimony is not competent proof and contributes “nothing to a
‘legally sufficient evidentiary basis.’” Weisgram v. Marley Co., 528 U.S. 440, 454
(2000) (citing Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509
Brief continued said... U.S. 209, 242 (1993)). “An expert’s opinions that are without factual basis and
are based on speculation or conjecture are . . . inappropriate material for
consideration on a motion for summary judgment.” Major League Baseball
Props., Inc. v. Salvino, Inc., 542 F.3d 290, 311 (2d Cir. 2008). “[S]ummary
judgment may be appropriate if an expert opinion is fundamentally unsupported
and therefore of no assistance to the trier of fact.” Eckelkamp v. Beste, 315 F.3d
863, 868 (8th Cir. 2002); see also Viterbo v. Dow Chem. Co., 826 F.2d 420, 422
(5th Cir. 1987) (stating that although the federal rules of evidence “expanded the
acceptable basis for expert opinion [,] . . . this expansion does not extend to ‘make
summary judgment impossible whenever a party has produced an expert to support
its position’”) (quoting Merit Motors, Inc. v. Chrysler Corp., 569 F.2d 666, 673
(D.C. Cir. 1977) (citation omitted)).
Don Hedquist's opinions are not the facts in the case, nor are they helpful in
determining any issue in the case. In considering the City’s motion for summary
judgment, the district court relied on the facts. On summary judgment, the district
court was presented with and considered Hedquist’s report. The court was under
no obligation to take Hedquist’s opinions as fact. In fact, it was up to the court to
determine whether Hedquist’s opinion was based on “good grounds,” such as
reliability and relevance, or mere speculation. Furthermore, Hedquist’s opinion
cannot act as a substitute for the Landowners’ obligation to provide evidentiary
17
facts supporting Hedquist’s opinion. None of the facts presented by Landowners
support Hedquist’s opinion. Without such factual basis, Hedquist’s opinion is
inappropriate material for consideration on a summary judgment motion.
Hedquist’s opinion does not contribute to any legally sufficient evidentiary basis
to overcome a motion for summary judgment. Therefore, Hedquist’s expert
opinion is incapable of supporting the Landowner’s argument that the district
court erred when it granted the City summary judgment.
STATEMENT OF THE STANDARD OF REVIEW
I. SUMMARY JUDGMENT IS REVIEWED DE NOVO
The district court’s grant of summary judgment is reviewed de novo. Barge
v. Anheuser Busch, Inc., 87 F.3d 256, 258 (8th Cir. 1996).
II. DISCOVERY RULINGS ARE REVIEWED FOR AN ABUSE OF
DISCRETION
The district court’s discovery orders are reviewed very narrowly and will be
upheld, unless there was a gross abuse of discretion. Derby v. Godfather’s Pizza,
45 F.3d 1212, 1215 (8th Cir. 1995).
The district court’s decision to issue [or not issue] sanctions for discovery
abuse is reviewed using the “abuse of discretion” standard. Baker v. Gen. Motors
Corp., 86 F.3d 811, 816 (8th Cir. 1996).
Brief continued said... SUMMARY OF THE ARGUMENT
The Landowners are or were owners of residential rental properties in the
City. Like any property owner with substandard housing in violation of City
codes, the Landowners were subject to the City’s lawful code enforcement. The
Landowners claim that the City enforced its codes against them in a manner that
violated state and federal laws. The Landowners claim that the City violated the
Fair Housing Act; 42 U.S.C. §§ 1981, 1982, 1983; and civil RICO laws through its
enforcement actions. The Gallagher Landowners claim the City violated 42
U.S.C. § 1985 and violated various state laws.4 The Gallagher Landowners claim
that Chapters 34, 43, 45, and 51 of the City’s Legislative Code are
unconstitutionally vague.
The Landowners have not provided any evidence to substantiate their
causes of action and avoid the City’s request for summary judgment. Therefore,
the district court Order should be affirmed.
The Landowners also request that this Court reverse the district court’s
ruling on the Landowners’ motion to compel and the original and renewed
motions for sanctions. The district court did not abuse its discretion when ruling
on these motions. Accordingly, the district court’s Orders should be affirmed.
19
ARGUMENT
I. IT WAS PROPER FOR THE DISTRICT COURT TO GRANT
SUMMARY JUDGMENT IN THE CITY’S FAVOR WHEN THE
EVIDENCE PRESENTED NO GENUINE ISSUES OF MATERIAL
FACT FOR TRIAL
A. Fair Housing Act
Section 3604 of the Fair Housing Act (“FHA”) makes it unlawful to refuse
to sell or rent to any person or discriminate in the terms, conditions, or privileges
of sale or rental of a building on the basis of race, color, religion, sex, familial
status, or national origin. 42 U.S.C. § 3604(a)-(b). The FHA also makes it
“unlawful to coerce, intimidate, threaten, or interfere with any persons in the
exercise or enjoyment of, or on account of his having exercised or enjoyed, or on
account of his having aided or encouraged any other person in the exercise or
enjoyment of, any right granted or protected by” § 3604. 42 U.S.C. § 3617.
The Landowners claim that they rent to a higher percentage of African-
Americans than the PHA does and that this difference is the key to their FHA
claims. Gallagher ADD 000010, A 260.
1. Disparate Impact
To succeed on their disparate impact claim, the Landowners must show the
facially-neutral policy results in, or can be predicted to result in, a disparate impact
on protected classes compared to a relevant population. See Darst-Webbe Tenant
Ass’n. Bd. v. St. Louis Hous. Auth., 417 F.3d 898, 902 (8th Cir. 2005) [hereinafter
Brief continued said... Darst-Webbe]. If the Landowners make such a showing, the City must
demonstrate that the objected to policy has a “manifest relationship” to legitimate,
non-discriminatory policy objectives and “is justifiable on the ground that it is
necessary to” the attainment of those objectives. Id. If the City makes that
showing, the burden shifts back to the Landowners to show that a viable
alternative means is available to achieve the legitimate policy objectives without
discriminatory effects. Id. at 902-03.
The Steinhauser and Harrilal Landowners failed to identify in writing the
facially-neutral policy with which Steinhauser and Harrilal Landowners take issue.
Steinhauser/ Harrilal Br. pp. 26-32. Therefore, the City analyzes Steinhauser and
Harrilal Landowners’ claim on appeal assuming that the facially-neutral policy is
that which they identified for the first time at oral argument - - the City’s
enforcement of the City’s housing code instead of enforcing the federal HQS.
Gallagher ADD 000011. In order to support their claim, Steinhauser and Harrilal
Landowners allege, in sum and substance, that since African-Americans make up a
disproportionate percentage of low-income tenants, and compliance with the
City’s housing code increases the cost of low-income housing, that they have
shown that there is a disparate impact on African-Americans. However,
Steinhauser and Harrilal Landowners must do more than show that the housing
code increases the cost of low-income housing and that African-Americans tend to
The Landowners 5 only include a selection of the document in their
Appendix (APP 001442-001447) and one page that the Landowners specifically
cite is heavily redacted. The City, in its effort to uncover the document in the
exchanged discovery, actually found that the document with the same bates
21
have lower incomes. See Reinhart v. Lincoln County, 482 F.3d 1225, 1230 (10th
Cir. 2007) (“It is not enough for the [plaintiffs] to show that (1) a regulation would
increase housing costs and (2) members of a protected group tend to be less
wealthy than others. It is essential to compare who could afford the housing
before the new regulations with who could afford it afterwards.”). To make a
prima facie case of disparate impact, Steinhauser and Harrilal Landowners need to
offer evidence establishing the different costs of rent for African-Americans under
the City’s housing code and federal HQS and the percentages of African-
Americans who could not afford the rent because the City enforced the housing
code in lieu of enforcing federal HQS. The Steinhauser and Harrilal Landowners
provided no comparison and no such evidence to support this claim.
On pages 29 and 30 of Steinhauser and Harrilal Landowners’ brief, the
Landowners claim that the City made admissions of disparate impact. The
Landowners cite page 23 of a City of St. Paul 2000 Consolidated Plan and
Submission, and an unnumbered and heavily redacted page of what appears to be
from the same document. Nothing in this document supports the Landowners’
contention that the City admits that its code enforcement has a disparate impact on
African-Americans.5 The statement upon which Steinhauser and Harrilal
number was a different document altogether. Therefore, it is unclear to the City if
this is a document exchanged during discovery, or something new upon which the
Landowners have chosen to rely. In any event, it does not further their claim that
the City’s code enforcement had a disparate impact on African-Americans. A 261.
22
Brief continued said... Landowners rely on in order to show disparate impact states that the City does not
have data related to the race or ethnicity of households with housing needs. See
Steinhauser/Harrilal Br. p. 29. It therefore appears that the Steinhauser and
Harrilal Landowners are now relying on the lack of data in order to support their
disparate impact claim, when it is undisputed that the claim needs data and
evidence to support it. Likewise, the 2000 Consolidated Plan that states that new
immigrants oftentimes are heavily concentrated in central cities does not provide
the statistical comparison or evidence that Steinhauser and Harrilal Landowners
need in order to sustain a disparate impact claim.
Even if Steinhauser and Harrilal Landowners could show a disparate impact
in the City’s application of its codes versus the federal HQS, the next
determination would be whether the City could satisfy its burden to prove that any
disparate impact was justifiable as necessary to achieve legitimate policy
objectives. See Darst-Webbe, 417 F.3d at 901 (citing Oti Kaga, Inc. v. S.D. Hous.
Dev. Auth., 342 F.3d 871, 833 (8th Cir. 2003)) (applying a burden shifting
analysis to a FHA disparate impact claim in finding a public fund allocation
decision “justifiable on the ground it is necessary to [the defendant’s] exercise of its funding responsibilities”). The City identified numerous legitimate policy
objectives to support its code enforcement including: providing minimum property
maintenance standards, keeping the City clean and housing habitable, and making
the City’s neighborhoods the safest and most livable anywhere in America.
Steinhauser and Harrilal Landowners never dispute that these objectives are
legitimate and nondiscriminatory, that the enforcement of the housing code has a
manifest relationship to these objectives, or that the enforcement of housing code
is necessary to achieve those objectives.
Furthermore, Steinhauser and Harrilal Landowners can only prevail on their
disparate impact claim by showing a viable alternative exists that would allow the
City to achieve the same objectives without discriminatory effect. See Darst-
Webbe, 417 F.3d at 903. Steinhauser and Harrilal Landowners provide no such
alternative and, therefore, their disparate impact claim fails.6
The Gallagher Landowners flat out disagree with the Reinhart, 482 F.3d
1225, holding and claim that the analysis of difference in rents under the federal
HQS and the City’s housing code is “nearly impossible.” Gallagher Br. pp. 30-31.
Brief continued said... To the extent that Plaintiffs 6 are relying upon Gallagher Landowners’
argument that the Problem Property 2000 program is a viable alternative, the City
relies upon and incorporates by reference the arguments relating to Problem
Property 2000 below.
Gallagher Landowners make no attempts with statistical data or any other sort of
analysis in order to support their disparate impact claim.
To prove a fair housing disparate impact claim statistics or some other
analytical method is invariably used. Andrews v. City of New York, No. CV-01-
7333, 2004 U.S. Dist. LEXIS 30290 (E.D.N.Y. Nov. 22, 2004) (citing
Tsombanidis v. W. Haven Fire Dep’t, 352 F.3d 565, 575 (2nd Cir. 2003)). A 85-
97. In addition, Gallagher Landowners must also use the appropriate comparison
groups and first identify members of a protected group that are affected by the
neutral policy and then similarly situated persons who are not affected by the
policy. Id.; see also Brown v. Omaha Hous. Auth., No. 8:05-CV-423, 2007 U.S.
Dist. LEXIS 53308 (D. Neb. July 20, 2007) (disparate impact claim generally
proved with statistical evidence). A 98-99. In the present case, however,
Gallagher Landowners provide no statistical proof or any other sort of analytical
method demonstrating the City enforced the housing code more aggressively
against them as compared to other landowners who have nonprotected class
tenants. In fact, the record reflects quite the opposite.
Had Gallagher Landowners attempted to support their claims with statistical
or analytical evidence, they would have discovered that there was no illegal
targeting. The record simply falls short of supporting Gallagher Landowners’
contention that the City maintained a policy which had a significant adverse
25
impact on a protected class and, therefore, Gallagher Landowners’ disparate
impact claim should be dismissed.
Gallagher Landowners also claim that Problem Property 2000 (PP2000) is a
viable alternative to the City enforcing its codes. See Gallagher Br. p. 36.
Gallagher Landowners do nothing more than argue that the program was
successful and do not put forth any evidence showing that PP2000 would
accomplish any different results concerning code enforcement’s impact on
protected class tenants. Gallagher Landowners cite to evidence indicating selected
City employees thought PP2000 worked well, but this evidence does not establish
how PP2000 ended the alleged affects on African-American tenants. As a result,
Gallagher Landowners do not successfully identify an alternative policy the City
should have used and, therefore, cannot maintain their disparate impact claim.
The district court properly dismissed all Landowners’ disparate impact claims as a
matter of law.
2. Disparate Treatment
The Landowners claim they have presented evidence of disparate treatment
due to City’s alleged violations of the Fair Housing Act. In their briefs, the
Landowners claim there was considerable evidence going to intentional
discrimination to meet the summary judgment standard.
Brief continued said... Disparate treatment, which occurs when some people are treated less
favorably than others because of their race, color, religion, sex, or national origin,
“is the most easily understood type of discrimination.” Int’l Bhd. of Teamsters v.
U.S., 431 U.S. 324, 335 n.15 (1975). Proof of discriminatory motive is crucial to a
disparate treatment claim. Id. To survive summary judgment on a disparate
treatment claim, a party must present either “direct evidence” of discrimination or
create “the requisite inference of unlawful discrimination” under the framework
set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802-03 (1973). See
Griffith v. City of Des Moines, 387 F.3d 733, 736 (8th Cir. 2004); East-Miller v.
Lake County Highway Dep’t, 421 F.3d 558, 563 (7th Cir. 2005) (distinguishing
between “direct evidence” and McDonnell Douglas framework in FHA context).
“[D]irect evidence is ‘showing a specific link between the alleged
discriminatory animus and the challenged decision, sufficient to support a finding
by a reasonable fact finder that an illegitimate criterion actually motivated’” the
adverse action. Griffith, 387 F.3d at 736 (quoting Thomas v. First Nat’l Bank of
Wynne, 111 F.3d 64, 66 (8th Cir. 1997)). “Direct evidence does not include stray
remarks, statements by nondecisionmakers, or statements by decisionmakers
unrelated to the decisional process itself.” Twymon v. Wells Fargo & Co., 462
F.3d 925, 933 (8th Cir. 2006) (quotation marks and citations omitted). See also
27
Harris v. Itzhaki, 183 F.3d 1043, 1055 (9th Cir. 1999) (applying direct evidence
exclusions in FHA context).
A party with direct evidence that illegal discrimination motivated the
adverse action does not need the three-part McDonnell Douglas analysis to survive
summary judgment, even if the strong evidence is circumstantial. See Griffith,
387 F.3d at 736. A party who lacks evidence that clearly points to the presence of
an illegal motive, however, can only avoid summary judgment by creating the
requisite inference of unlawful discrimination under the McDonnell Douglas
framework. Id. Under the McDonnell Douglas framework, once the plaintiff
establishes a prima facie case of discrimination, the burden shifts to the defendant
to articulate a legitimate, nondiscriminatory reason for its actions. See Gilbert v.
Des Moines Area Cmty. Coll., 495 F.3d 906, 914 (8th Cir. 2007). If the defendant
offers a legitimate, nondiscriminatory reason, the burden shifts back to the
plaintiff to put forth evidence showing the defendant’s proffered explanation is a
pretext for unlawful discrimination. Id.
The Landowners in this case did not base their disparate treatment argument
on the McDonnell Douglas framework. Therefore, the district court was correct in
considering whether the Landowners have offered evidence showing a specific
link between the alleged discriminatory animus and the challenged decision that is
sufficient to support a finding by a reasonable fact finder that an illegitimate
28
criterion actually motivated the adverse action. The Landowners have
Brief continued said... failed to
offer any such evidence. Alternatively, should this Court determine that the
Landowners did in fact argue their disparate treatment claim under the McDonnell
Douglas framework, the Landowners have still failed to establish the requisite
inference of unlawful discrimination. The district court was correct in dismissing
the Landowners’ disparate treatment claim.
The Landowners claim that an email from Jane Prince, a legislative aide to
former City Council member Jay Benanav, in December of 2005 demonstrates that
the City knew its code enforcement targeted minorities yet dismissed the
discriminatory effect and took no remedial action. Prince’s email, however,
related to a call from a City resident who was concerned that her neighbors were
calling in housing complaints against her because she was a person of color. In
the email, Prince stated that there was a “very real possibility that people of color
are unfairly targeted by the city’s complaint[-]based system” and that a block
meeting would be set up to discuss the concern with neighbors. APP 000007.
What this email demonstrates is that the resident was concerned about the
neighbors targeting her on the basis of race. What this email does not demonstrate
is the resident’s concern that the City was targeting her on the basis of her race.
Prince’s email makes clear that the City took the resident’s concerns seriously and
wanted to solve the issue. As the district court correctly decided, the Prince email
29
is not evidence of discriminatory animus on the part of the City. Nor does the
Prince email establish the requisite inference of unlawful discrimination under the
McDonnell Douglas framework.
The Landowners claim that a statement Dawkins made to Bill Cullen, a real
estate investor, is direct evidence of discrimination. It is the Landowners’
contention that Dawkins suggested to landlords that maybe the solution for the
City was to try to increase the quality of properties to the point that the lower tier
of less qualified tenants would have no places to rent. Cullen testified that
Dawkins asked a group of landlords how the landlords would like it if they didn’t
have to deal with tenants on the bottom of the market – “if all those tenants that
are at the bottom . . . were no longer in St. Paul.” Steinhauser/Harrilal Br. p. 37.
Although Dawkins’ statement was racially neutral on its face, the Landowners
contend that the statement reveals a racially discriminatory mind set. The context
of Dawkins’ statement, however, exposes the fatal flaw in the Landowners’
assertion.
According to Cullen’s testimony, Dawkins made the statement in question
during a meeting regarding improving conditions in the City’s Payne/Phalen
neighborhood. One suggestion as to how to improve the neighborhood was that
landlords screen their tenants. The suggestion prompted a discussion of the
attributes of low-income tenants. To illustrate, Cullen drew a box with the best
Brief continued said... tenants, those with high income, the best credit and the least criminal histories, at
the top. The worst tenants, those with poor credit scores, criminal records, poor
rental histories and low income, were at the bottom of the box. Race was not one
of the factors discussed related to either type of tenant. Even assuming Dawkins
did want to get rid of “bottom of the box” tenants, his statement was race-neutral
and reveals no discriminatory animus. See Twymon, 462 F.3d at 934 (finding that
race-neutral statements, without more, do not demonstrate racial animus). To
draw an inference of discriminatory intent would be to resort to speculation, which
a court must not do. See id.
The Landowners also point to a statement Dawkins made to Sara Anderson,
a housing advocate, as evidence of Dawkins’ racial animus. According to
Anderson, Dawkins stated that City officials and employees “don’t want lowincome
people renting in the City.” Steinhauser/Harrilal Br. p. 37. However,
Anderson also testified that she never heard Dawkins make any other negative
statements about low-income tenants. In addition, Anderson testified that she has
never heard any other City employee say he or she did not want low-income
people renting in the City. As the district court correctly concluded, there is no
evidence to suggest that Dawkins’ facially race-neutral statement arose from racial
animus on the part of Dawkins.
31
The Landowners further point to the deposition testimony of former Legal
Aid attorney Perry DeStefano as direct evidence of discrimination. In 2004,
DeStefano wrote to the City Council in order to notify the City that he believed
neighbors were making false allegations to police due to his client’s, a tenant,
protected class status. Discriminatory animus on the part of the neighbors is not
evidence of discriminatory animus on the part of the City. DeStefano also testified
that he thought the City used housing code enforcement and other tactics to evict
protected class members. These tactics included failing to mail corrective orders,
“backdating” housing inspection reports and delayed mailings. None of these
actions taken by the City indicates intentional discrimination on the basis of race.
The corrective orders were properly mailed to the building owner, a resident of
Georgia. The City’s decision to mail correction orders to the property owner in
accordance with the St. Paul Legislative Code § 40.06 is not direct evidence of
intentional discrimination. As to the backdating of letters, the Landowners
presented no evidence to suggest that any letter was in fact backdated instead of
merely delayed. Further, no evidence suggests that any delay in mailing letters
was intentional, motivated by race of the tenants, or anything other than clerical
error.
Appellants also point to statements housing code inspectors Lisa Martin and
Dean Koehnen allegedly made to Steve Johnson. Johnson alleges that when asked
Brief continued said... why they were issuing so many orders on his rental properties, Martin and
Koehnen replied by describing Johnson's tenants as “trouble makers,” “out of
towners,” “low life tenants,” “bottom of the barrel,” “undesirable tenants” and “the
black plague come like roaches.” Harrilal Br. p. 38; Steinhauser Br. p. 37. There
is no evidence to suggest that Martin and Koehnen's statements arose from the
racial animus of either inspector.
Similarly, Caty Royce testified that the City has a history of discriminatory
demolition of protected class housing. A bald accusation without supporting facts
does not lead to the conclusion that the City’s practices were indeed driven by
racial animus. In addition, Royce pointed to the neighbor’s use of code
enforcement to “get rid of her Black tenants.” Harrilal Br. p. 39; Steinhauser Br.
p. 38. Again, discriminatory animus by the neighbors is not evidence of
discriminatory animus by the City. Nor is Royce’s opinion direct evidence of
discriminatory animus by the City.
The Landowners also argue that the City’s decision to terminate the PP2000
Program, through which the City worked with landlords to achieve their
compliance with the housing code, is direct evidence of discrimination.
Steinhauser/Harrilal Br. p. 39. The Landowners contrast the City’s decision to
terminate the PP2000 Program with the City’s working relationship with the PHA.
Id. The Landowners do not explain how the City’s working relationship with the
Brief continued said... PHA furthers the Landowners’ claim that the City had a discriminatory animus
which motivated it to terminate the PP2000 Program. The Landowners’ entire
argument regarding PP2000 seems to be that since there are individuals who
thought the program worked well, the City’s decision to discontinue the program
must be evidence of discriminatory animus. However, lacking in this conclusory
statement is any actual evidence of discrimination. Furthermore, the PHA has a
working relationship with the City where it pays the City for community policing
which is above and beyond regular police service provided to the PHA and all
other properties. A 32-34. The City is not providing this service to the PHA free
of charge.
The Landowners also claim that they did not receive any financial help from
the City or the federal government to assist them in renovations of their older
properties. Steinhauser/Harrilal Br. p. 39. The Landowners do not explain how
the fact that they were not provided government aid in order to run their business
furthers their claim that the City had a discriminatory intent. As I am sure even
the Landowners would agree, the City or the federal government are not obligated
to provide private business financial resources.
8th Cir_RICO said... Here's a link for 8th Cir. Cases
for your research
http://www.ca8.uscourts.gov/opns/opFrame.html
Brief continued said... B. Constitutional Claims
1. § 1981, § 1982 Claims
The Landowners challenge the district court’s dismissal of their claims
under 42 U.S.C. § 1981 and § 1982. The Landowners are required to show
discriminatory intent in order to prevail on their claims under 42 U.S.C. § 1981, §
1982. Dirden v. HUD, 86 F.3d 112, 114 (8th Cir. 1996). On appeal, in an effort
to present evidence of discriminatory intent, the Landowners rely on 2922
Sherman Ave. Tenants’ Ass’n v. D.C., 444 F.3d 673 (D.C. Cir. 2006).
In 2922 Sherman, the court found that there was evidence that defendant
District of Columbia intentionally discriminated against tenants on the basis of
race when at first 75 buildings evenly distributed throughout the city were
recommended for a property list that may end in closure of the buildings. Id. at
682. Thereafter, the list was narrowed to 27 buildings that were in an area where
Hispanic residents were 4.1 times as great as the percentage of Hispanics in the
city as a whole. Id. Ultimately, 5 buildings were closed in an area that had an
average of Hispanics 4.4 times greater than the percentage of Hispanics in the city.
Id.
The Landowners rely on maps they have attached to their affidavits to liken
their case to 2922 Sherman. However, the Landowners’ random selection of maps
does not further their cause. In 2922 Sherman, the tenants were able to identify a
35
list of evenly distributed properties that were first put on the property list. Id. The
tenants were then able to identify a second list that narrowed the properties down
to those that were 4.1 times more populated with Hispanic residents. Id. And
then, further, were able to show a list of 5 properties that were closed in an area
that had 4.4 times more Hispanic residents. Id. The maps produced by the
Landowners in the case at bar make absolutely no comparison at all. The
Landowners have no evidence that other properties in similar condition to their
properties underwent any less code enforcement because of the race of the tenants.
The Landowners completely fail to connect code enforcement to race. At best, the
Landowners’ maps only show the neighborhoods in which they claim to have
owned properties, and that no matter where they owned properties or what the race
of the tenant, they could be subject to the City’s lawful code enforcement.
The Landowners also claim that “the City’s discriminatory environment and
attitude in housing code enforcement, force ownership change strategy and
eviction strategy were known by the City to eliminate affordable housing and to
have a disproportionate impact on protected class members.” Gallagher Br. at p.
48. This statement does not show any discriminatory intent on behalf of the City
and instead is conclusory and without evidentiary support.
Landowners rely on their claim that the City had an “animus toward rental
properties (Andy Dawkins’ own statements).” Steinhauser/Harrilal Br. p. 54;
Brief continued said... Gallagher Br. p. 49. The Landowners did not identify any statements to support
this claim and, in any event, the Landowners are alleging an animus towards rental
property, not anything that relates to race at all.
The Landowners also claim that there is “a complaint-based code
enforcement system that has a problem with targeting people of color (Jane
Prince’s email and Dawkins’ memo), and getting rid of the bottom tier of tenants
and low-income people in the City (Cullen’s and Anderson’s testimony).”
Steinhauser/Harrilal Br. p. 54; Gallagher Br. p. 49. First, the complaint-based
system of which Landowners Steinhauser and Harrilal rely upon and Prince’s
email concerning it, provide absolutely no evidence to support the Landowners’
claims that the City had discriminatory intent. The email is clearly regarding
neighbors’ possible discriminatory motives, not the City’s. Furthermore, the
Landowners rely on a statement regarding “bottom tier of tenants” and “lowincome
people.” On their face, those statements have nothing to do with race and
there is no evidence to support Landowners’ § 1981 and § 1982 claims.
Therefore, the district court properly dismissed Landowners’ § 1981 and § 1982
claims.
2. § 1983 Claims
The Landowners make claims under 42 U.S.C. § 1983 for alleged violations
of their constitutional rights under the 14th and 5th Amendments to the
The Landowners abandoned 7 their claims under the 4th Amendment to
the Constitution.
37
Constitution.7 Success on a § 1983 claim requires a showing of: “(1) [a] violation
of a constitutional right, (2) committed by a state actor, (3) who acted with the
requisite culpability and causation to violate the constitutional right.” Shrum v.
Kluck, 249 F.3d 773, 777 (8th Cir. 2001).
3. 14th Amendment
The Landowners allege violations of their 14th Amendment right to equal
protection as a result of the City’s code enforcement policies. The equal
protection clause of the 14th Amendment requires state actors to treat similarly
situated people alike and permits state actors to treat dissimilarly situated people
dissimilarly. Gamely v. Minneapolis Park & Rec. Bd., 491 F.3d 743, 747 (8th Cir.
2007). As a threshold matter, the Landowners must establish that the City treated
them differently from similarly situated landowners. Id. In addition to unequal
treatment, the Landowners must also show intentional or purposeful
discrimination. See Lewis v. Jacks, 486 F.3d 1025, 1028 (8th Cir. 2007).
The Landowners simply put forth no evidence showing intentional
discrimination on behalf of the City. The Landowners continue to cite “force
ownership change strategy and eviction strategy” as if stringing together words
from Andy Dawkins’ notes, without more, is enough to provide evidence of
Brief continued said... intentional discrimination. Gallagher Br. at pp. 44, 45 and Steinhauser/Harrilal
Br. p. 52. These phrases are not evidence of intentional discrimination, but what
Andy Dawkins had in his notes to explain his strategy to make sure that those who
owned rental properties were those who had the ability and desire to keep the
property safe for its renters. The City has the legal right to take over evictions for
landlords when the landlord could not or did not want to follow through with an
eviction proceeding because of the tenants they had. Therefore, these phrases are
not evidence of intentional discrimination and the Landowner’ equal protection
claim based on race fails. See id.
The Landowners make a “class-of-one” equal protection argument based on
what they describe as the City’s preferential treatment of the PHA. The purpose of
a class-of-one equal protection claim is “to secure every person within the state’s
jurisdiction against intentional and arbitrary discrimination, whether occasioned
by express terms of a statute or by its improper execution through duly-constituted
agents.” Vill. of Willowbrook v. Olech, 528 U.S. 562, 564 (2000). In order to
prevail on their class-of-one claim, the Landowners must show they have been
“intentionally treated differently from others similarly situated and that there is no
rational basis for the difference in treatment.” Id.; see also, Costello v. Mitchell
Pub. Sch. Dist. 79, 266 F.3d 916, 921 (8th Cir. 2001).
39
The Landowners have provided no evidence to support the claim that they
have been intentionally treated differently from others similarly situated and that
there is no rational basis for that treatment. Therefore, the Landowners’ class-ofone
claim fails.
Even if the Landowners could show that the PHA properties received
preferential treatment from the City, the Landowners would still be required to
show there is no rational basis for the difference in treatment between the
Landowners and the PHA to prevail on the class-of-one equal protection claim.
See id. The PHA is an organization with a comprehensive inspection schedule,
staff dedicated to maintenance, and a demonstrated record for maintaining its
properties. A 84. The Landowners simply have not put forth any evidence
showing that the PHA properties are in poor condition or that the PHA fails to
make repairs or correct situations after receiving notification of a violation of the
housing code.
On the contrary, the record indicates that the PHA responds appropriately to
DNHPI correction orders and makes repairs in a timely manner. A 84. Given the
City’s limited resources and PHA’s record of maintaining its properties, had the
Landowners been able to show that the PHA received preferential treatment in
code enforcement, the City would certainly have a rationale basis for permitting
PHA different treatment from the Landowners.
Brief continued said... 4. Substantive Due Process
The Landowners contend that the City’s enforcement of the housing code
violated their substantive due process rights. The Landowners must show that a
governmental power was exercised arbitrarily and oppressively to succeed on their
substantive due process claims. See Roseman v. City of Columbia Heights, 268
F.3d 588, 593 (8th Cir. 2001). The government action must be arbitrary in the
constitutional sense. Id. “[T]he theory of substantive due process is properly
reserved for those truly egregious and extraordinary cases.” Id. The Gallagher
Landowners claim that they have provided sufficient evidence to withstand
summary judgment on this theory.8 In order to support this theory, Gallagher
Landowners once again cite this force ownership change strategy and eviction
strategies as their evidence. Once again, this is not evidence, but merely stringing
together words from Dawkins’ handwritten notes without recognizing that the
eviction strategy is only a reiteration of the law which allows the City to step in for
a landlord and effectuate an eviction. The force ownership change strategy is only
the City’s hope to have the possession of rental property in the hands of those who
will maintain them in a safe and lawful manner. This is not evidence of a violation
of the Landowners’ substantive due process. Therefore, this claims fails.
The Steinhauser 8 and Harrilal Landowners do not discuss substantive
due process in their brief and, therefore, appear to have abandoned this theory.
5. § 1985
Gallagher Landowners claim on appeal that the district court erred when it
dismissed their § 1985 claims.9 To prove the existence of the civil rights
conspiracy under § 1985(3), Gallagher Landowners must prove that: (1) that
defendants did conspire, (2) for the purpose of depriving, either directly or
indirectly, any person or class of persons of equal protection of the laws, or equal
privileges and immunities under the laws, (3) that one or more of the conspirators
did, or cause to be done, any act in furtherance of the object of the conspiracy, and
(4) that another person was injured in his person or property or deprived of having
and exercising any right or privilege of a citizen of the United States. Larson by
Larson v. Miller, 76 F.3d 1446, 1454 (8th Cir. 1996) (quotations omitted). The
“purpose” element of the conspiracy requires Gallagher Landowners to prove a
class-based “invidiously discriminatory animus.” See id. Gallagher Landowners
must allege with particularity and specifically demonstrate with material facts that
the City or its Appellee employees reached an agreement, for example, by pointing
to at least some facts which would suggest the City or its Appellee employees
reached an understanding to violate the Gallagher Landowners’ civil rights or their
tenants’ civil rights. See id. In order to meet this prong, the Gallagher
9 Steinhauser and Harrilal Landowners have not challenged the district
court’s dismissal of their § 1985 claims.
41
Brief continued said... Landowners simply state that they have “alleged with particularity and specificity
the City’s understanding of the impact of their discriminatory environment and
attitude in housing code enforcement, force owner change strategy and eviction
strategy.” See Gallagher Br. p. 49. Conspicuously absent from this conclusory
statement is any actual evidence supporting that the City and its employees
reached an agreement to violate the Landowners’ or their tenants’ civil rights.
Next, the Landowners claim that Dawkins had meetings with Chief Judge Mott
and City Attorney Cervantes to get “‘buy-in’ to [Dawkins’] aggressive force
ownership change and eviction strategies.” See Gallagher Br. p. 50. However,
nowhere within this statement is any evidence to support Gallagher Landowners’
claims that the City or its employees conspired to violate the Landowners’ or their
tenants’ civil rights. The Gallagher Landowners simply string together words
from Dawkins’ handwritten notes and then attempt to package it as evidence of
discrimination. The Gallagher Landowners fall far short of showing any
conspiracy to deny the Landowners’ or their tenants’ civil rights. Therefore,
Gallagher Landowners’ § 1985 claims were properly dismissed by the district
court.
6. Void for Vagueness
The Gallagher Landowners contend that certain terms are unconstitutionally
void for vagueness. Gallagher Landowners specifically identify the terms “vacant
43
building,” “code compliance,” problem properties,” and “legal occupancy.”
Landowner Allison offered evidence relating to a property located at 1522/1524
Carroll Avenue in support of his argument regarding the term “vacant building.”
This property is an upstairs/downstairs duplex and one of seven properties owned
by Landowner Allison which he purchased from the Landowner Dadders Entities.
“The void-for-vagueness doctrine is embodied in the due process clauses of
the fifth and fourteenth amendments.” Woodis v. Westark Cmty. Coll., 160 F.3d
435, 438 (8th Cir.1998). A vague regulation violates the Constitution because it
fails (1) to define the offense with sufficient definiteness that ordinary people can
understand prohibited conduct and (2) to establish standards to permit
enforcement of the law in a non-arbitrary, non-discriminatory manner. Id. “In a
facial vagueness challenge, an enactment reaching a substantial amount of
constitutionally protected conduct may withstand constitutional scrutiny only if it
incorporates a high level of definiteness. An enactment imposing criminal
sanctions or implicating constitutionally protected rights demands more
definiteness than one which regulates the economic behavior of businesses.” Id.
(citations omitted).
The Court must first “determine whether the enactment reaches a substantial
amount of constitutionally protected conduct.” Id. Where the enactment does not
reach constitutionally protected conduct, a plaintiff may succeed in a vagueness
Brief continued said... challenge “only if the enactment is impermissibly vague in all of its applications.”
Id. (quotation marks and citations omitted). For these reasons, the Court must
“examine the [plaintiff’s] conduct before analyzing other hypothetical applications
of the law, because a plaintiff who engages in some conduct that is clearly
proscribed cannot complain of the vagueness of the law as applied to . . . others.”
Id. (quotation marks and citations omitted).
The St. Paul Legislative Code defines “vacant building” as:
A building or portion of a building which is:
a. Unoccupied and unsecured;
b. Unoccupied and secured by other than normal means;
c. Unoccupied and a dangerous structure;
d. Unoccupied and condemned;
e. Unoccupied and has multiple housing or building code
violations;
f. Condemned and illegally occupied; or
g. Unoccupied for a period of time over three hundred sixty-five
(365) days and during which time the enforcement officer has
issued an order to correct nuisance conditions.
St. Paul, Minn., Code § 43.02(7). There is no suggestion that the definition of
“vacant building,” which rests on the occupancy of a building, whether it is secure
from entry, and the condition of the building, reaches constitutionally protected
conduct. The district court, therefore, correctly examined the Gallagher
Landowners’ arguments regarding the vagueness of “vacant building” in light of
the those Landowners’ conduct. See Woodis, 160 F.3d at 438.
45
The Gallagher Landowners’ challenge focuses on the meaning of
“unoccupied” as used in the definition of “vacant building.” The St. Paul
Legislative Code defines “unoccupied” as “[a] building which is not being used
for a legal occupancy as defined in the Saint Paul Legislative Code.” St. Paul,
Minn., Code § 43.03(5). The St. Paul Legislative Code does not define “legal
occupancy,” but does define “residential occupancy” as “[o]ccupancy in a building
or portion thereof, for residential purposes, used or intended to be used for living,
sleeping, and/or cooking or eating purposes.” Id.
During his deposition, Landowner Allison testified that the downstairs
tenant had moved out shortly before Allison purchased 1522/1524 Carroll Avenue.
A 101. Allison also testified that the downstairs unit was “vacant” when he
purchased the property and when the City declared the property a vacant building.
A 101-102. Thus, Allison does not dispute that the downstairs unit was
unoccupied when the City declared the property vacant. Further, Allison does not
dispute that the property had housing code violations. A 103-105. A unit that is
unoccupied and has multiple housing code violations, as the downstairs unit of
1522/1524 Carroll Avenue did, falls within the definition of a vacant building, see
§ 43.02(7)(e), and is clearly proscribed. Allison lacks standing to challenge the
term “vacant building” on the grounds that it is unconstitutionally vague “because
a plaintiff who engages in some conduct that is clearly proscribed cannot complain
Brief continued said... of the vagueness of the law as applied to . . . others.” See Woodis, 160 F.3d at 438
(quotation marks and citations omitted).10
The Gallagher Landowners also cite to testimony from Dawkins and Dick
Lippert, the former head of DNHPI’s problem property unit, that they did not have
a definition for “problem property,” “code compliance,” “legal occupancy,” or
“vacant building.” Because the Gallagher Landowners have set forth no facts
establishing their standing to raise void for vagueness claims as to these terms, this
testimony is unavailing. The district court, therefore, properly dismissed the
Gallagher Landowners’ void for vagueness claims.
Even if Gallagher Landowners had established facts to support their
standing to raise void for vagueness claims, their claims still fail. Gallagher
Landowners fail to cite any evidence which demonstrates the code had failed to
put them on notice of certain proscribed conduct and how they were damaged by
such failure. Merely categorizing phrases commonly used in the housing arena as
vague does not satisfy the strict standard Gallagher Landowners need to establish
The Gallagher 10 Landowners also base their void for vagueness
challenge on the fact that a tenant was living in the upstairs unit of 1522/1524
Carroll Avenue when the inspector declared the building vacant. The inspector
based his decision to declare the entire building vacant on the vacancy of the
lower unit and his observation of the second story while standing on the ground.
While the decision to declare the entire building vacant may have been incorrect,
this does not make the term “vacant building” unconstitutionally vague. In fact,
the definition of “vacant building” permits the designation of a “portion of a
building” as a vacant building. St. Paul, Minn., Code § 43.02(7).
for a void for vagueness claim. For example, the phrase “problem properties” is
not a phrase used in the code nor is it a phrase meant to notify a landowner or
property owner of certain conduct that is required or prohibited and, therefore, it is
not a concept that is subject to a void for vagueness claim. The phrase has been
used to identify properties that have had numerous violations of the code - but the
phrase itself does not encompass conduct in which Gallagher Landowners needed
to comply with in order to follow the code. Gallagher Landowners reference
testimony from Dawkins demonstrating that he did not have the code memorized
with respect to how vacant buildings were classified as Category 1, 2 or 3 (a task
that Dawkins himself did not conduct as the Director of DNHPI). This does not
further Gallagher Landowners’ argument that the code itself was vague. Also, the
testimony from Lippert that he did not use the phrase “problem property” does not
assist their argument that the code is vague as that is not even a phrase set forth in
the code. Because Gallagher Landowners do not have standing in order to make a
void for vagueness claim, and, if they had standing, do not put forth evidence to
support their claim, it was properly dismissed by the district court as a matter of
law.
Brief continued said... C. RICO Claims
The Landowners claim that the City employees 11 in their individual
capacity violated federal RICO laws in violation of 18 U.S.C. § 1962(c)(d). A
plaintiff who brings suit under 18 U.S.C. § 1962(c) must prove that a defendant
engaged in (1) conduct; (2) of an enterprise; (3) through a pattern; (4) of
racketeering activity. Handeen v. Lemaier, 112 F.3d at 1347. To establish their
conspiracy claim under 18 U.S.C. § 1962(d), the Landowners must first prove a
violation of 18 U.S.C. § 1962(c). U.S v. Darden, 70 F.3d 1507, 1518 (8th Cir.
1995). Then Landowners must prove that a second defendant “objectively
manifested an agreement to participate directly, or indirectly, in the affairs of [the]
enterprise through the commission of two or more predicate crimes.” Handeen,
112 F.3d at 1355 (quoting U.S. v. Bennett, 44 F.3d 1364, 1372 (8th Cir. 1995))
(quotation omitted).
Racketeering Activity is defined in 18 U.S.C. § 1961(1). That section lists
as predicate acts certain state law crimes, conduct that is “indictable” under
11 Steinhauser Landowners stipulated that the RICO allegations were
not against the City or the individual defendants in their official capacity. Doc.
No. 12 in Steinhauser v. City of St. Paul, Civ. No. 04-2632.
Although stipulations were not signed regarding the later filed cases,
Harrilal and Gallagher, the City submits that the City and its employees in their
official capacity are not capable of forming the criminal intent necessary to
support a predicate act necessary for a RICO violation. Sanville v. McCaughtry,
266 F.3d 724, 732-733 (7th Cir. 2001); Lancaster Cmty. Hosp. v. Antelope Valley
Hosp. Dist., 940 F.2d 397, 404 (9th Cir. 1991), cert. denied, 502 U.S. 1094 (1992).
various federal provisions, and numerous other offenses. Handeen, 112 F.3d at
1353. In their complaints, the Landowners base their RICO allegations on seven
predicate acts: mail fraud, bank fraud, wire fraud, the Hobbs Act, tampering,
bribery, and interstate travel or transportation in aid of racketeering. In their
papers before the district court, the Landowners identified their RICO claims as
alleged false claims of housing code violations, the City’s use of its housing code
rather than the HQS, misrepresentations of code compliance inspections, and
extortion. In their briefs before this Court, the Landowners rely on the same
alleged RICO violations as set forth before the district court. Steinhauser and
Harrilal Landowners add claims that the City intentionally sent important notices
to the wrong addresses and delayed mail in order to prejudice the Landowners.
See Steinhauser/Harrilal Br. pp. 56 and 57 and c.f. Steinhauser Doc. 255, pp. 69-
76. Steinhauser and Harrilal Landowners also identify illegally removing
grandfathering protections and applying present codes to the Landowners’
properties, intentionally condemning buildings without a basis in City codes or
state law. These allegations were identified by Steinhauser and Harrilal
Landowners before the district court as misrepresentation of code compliance
inspections and alleged false claims of housing code violations.
The first prong the Landowners must prove in order to sustain a RICO cause
of action is that the City employees engaged in conduct of an enterprise. Handeen,
Brief continued said... 112 F.3d at 1347. The City may constitute an “enterprise” within the meaning of
RICO. See U.S. v. Clark, 646 F.2d 1259, 1263 (8th Cir. 1981). However, the
Landowners must have evidence that the City employees were engaged in conduct
of the enterprise (the City) and not simply conducting their own affairs. The
Landowners put forth absolutely no evidence that showed that any City employee
was doing anything more than conducting his or her own affairs. See Reeves v.
Ernst & Young, 507 U.S. 170, 185 (1993) (“Liability depends on showing that the
defendants conducted or participated in the conduct of the ‘enterprise’s affairs’
not just their own affairs”) (emphasis in original); Bennett v. Berg, 710 F.2d 1361,
1364 (8th Cir. 1983) (“Mere participation in the predicate offenses listed in RICO,
even in conjunction with the RICO enterprise, may be insufficient to support a
RICO cause of action.”). Therefore, the Landowners fail to show that the City
employees engaged in conduct of an enterprise.
Landowners claim that City employees violated RICO by making false
claims of housing code violations, intentionally condemned buildings without a
basis in City codes or state laws, illegally condemned homes on “trumped up
charges of code violations.” See Steinhauser/Harrilal Br. pp. 54, 58; Gallagher Br.
p. 54. However, the Landowners do not provide any evidence that the City
intentionally falsified code violations. To the contrary, the Landowners admit
many times that the code violations existed, but claim that the City was being
51
nitpicky or taking the opportunity to write the landlord up on every possible
violation. A 100-258. The Landowners do, however, challenge certain code
violations by claiming that the violation never existed. However, the Landowners
never put forth any evidence to support their claim that the City intentionally
falsified any of its code enforcement orders setting forth the Landowner’s housing
code violations.
The Landowners claim that the City somehow concealed differences
between its housing code and the HQS is also unavailing. The City’s housing
codes are readily available and public as are the Federal Housing Quality
Standards. In any event, the Landowners do not identify if such concealment
existed, how it would be a predicate act necessary to sustain a RICO cause of
action.
At the district court, Landowner Meysembourg claimed that the City
engaged in racketeering by misrepresenting the nature of code compliance
inspection by describing a TRA that the City filed against him and ultimately
settled. Landowner Meysembourg complained that the City Attorney Maureen
Dolan set forth on the record that he was not required to bring his property up to
the 2003 code, but when Meysembourg contacted the City’s Office of License,
Inspection, Environmental Protection (LIEP) to schedule his inspection, he was
told that there was no such thing as an “as-built” code compliance inspection. The
Brief continued said... LIEP inspector offered to talk to his supervisor about the situation and
Meysembourg did not pursue the matter further. There is no evidence that
Assistant City Attorney Maureen Dolan had entered into the settlement with
Meysembourg intentionally misrepresenting the nature of the code compliance in
which Meysembourg agreed to go through. Even if she had intentionally
misrepresented it, Meysembourg would still have to show that that conduct
constituted a predicate act giving rise to RICO liability. Generic allegations of
common law fraud do not constitute racketeering activity. See Giuliano v. Falton,
399 F.3d 381, 388 (1st Cir. 2005). Furthermore, Meysembourg has not put forth
any evidence showing that Dolan’s conduct used the U.S. mail or wires. There is
no evidence to support a claim that Dolan’s conduct would be extortion or
attempted extortion because she certainly did not seek any property from
Meysembourg. See Scheidler v. NOW, Inc., 537 U.S. 393, 405 (2003) (holding
that shutting down abortion clinics was not extortion because protesters “neither
pursued nor received ‘something of value from’ respondents that they could
exercise, transfer or sell”). Therefore, even if Dolan had intentionally misled
Meysembourg, Landowner Meysembourg has not established that her conduct
constituted a predicate act.
The remaining Landowners do not identify any facts specific to them that
would support their allegation that code compliances by the City were
53
administered in such a way that it was a predicate act enumerated as a racketeering
activity as defined by statute.
In order to support their RICO allegations against Magner, the Landowners
rely on affidavits of Nancy Osterman, Julian Jayasuriya, and Lois Jacobs which
were previously filed with the district court on June 15, 2007. APP 000435-
000442, 000457-000459. In Osterman’s affidavit, she claims that Magner
instructed her to sell her home to “someone” and was presented the purchase price
of $40,000. APP 000436 at ¶ 8. Osterman ultimately sold her home to Julian
Jayasuriya for $90,000. Id. at ¶ 10. Julian Jayasuriya alleges that Osterman told
him that she was told by Magner to sell her home to someone of Magner’s
choosing at a price drastically below fair market value. APP 000439. He also
complains that he expressed disagreement with Magner’s methods of code
enforcement or ethics. Id. at ¶ 7. Lois Jacobs alleges that Magner offered to buy
her home for $50,000 cash. APP 000458. She also alleges that Magner threatened
to have her grandson taken to jail because her grandson was breaking the law by
living in her condemned home. Id. at ¶ 6.
The Landowners cannot sustain a civil RICO claim against Magner, as they
do not have standing. 18 U.S.C. § 1964(c) confers standing on any individual who
has experienced injury to his or her business or property that occurred by reason of
a RICO violation. Bowman v. W. Auto Supply Co., 985 F.2d 383, 384 (8th Cir.
Brief continued said... 1993). The Landowners have not shown any injury to their business or property
based on the alleged conversations that Magner had with non-plaintiffs Osterman
or Jacobs. In fact, even if Osterman or Jacobs were parties to this lawsuit, and
also making RICO allegations, their allegations could not survive summary
judgment. By their own admissions, they have not suffered any economic injury
because of the alleged conversations with Magner. Even Osterman and Jacobs
admit that Magner did not compel them to sell him their properties at a rate below
fair market value or extort anything from them. Jayasuriya has not even claimed
that Magner offered to buy the property at below market value, but rather
reiterates a story told to him by Osterman. Certainly, the Landowners’ RICO
allegations against Magner were properly dismissed on summary judgment. Not
only do they show absolutely no economic injury because of Magner’s alleged
conversations with Osterman and Jacobs, but Osterman and Jacobs likewise did
not have any economic injury.
Furthermore, the allegations made by Osterman and Jacobs do not rise to the
level of a predicate act. 18 U.S.C. § 1951(b)(2) (extortion means obtaining the
property of another). Neither Magner nor anyone affiliated with him ever obtained
Osterman’s or Jacob’s property.
Magner’s alleged offer to buy property from Osterman and alleged offer to
buy property from Jacobs does not establish a “pattern.” “[T]o prove a pattern of
55
racketeering activity a plaintiff or prosecutor must show that the racketeering
predicates are related, and that they amount to or pose a threat of continued
criminal activity.” H. J., Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 239 (1989); see
Sedima v. Imrex Co., 473 U.S. 479, 497 (1987); Diamonds Plus, Inc. v. Kolber,
960 F.2d 765, 769 (8th Cir. 1992). Assuming that the actions described in the
affidavits were predicate acts, evidence that Osterman was offered below market
value for her home by Magner in August of 2003 and that Jacobs was offered
below market value for her home by Magner at an unidentified time is not enough
to establish a pattern. APP 000436.
Even if this Court assumes the facts described in the affidavits of nonparties
constitute a predicate act of extortion, the affidavits, without more, are
insufficient to permit a jury to reasonably find that Magner’s attempts at extortion
were a regular way of conducting the City’s business. “The mere existence of a
scintilla of evidence in support of the plaintiff’s position will be insufficient; there
must be evidence on which the jury could reasonably find for the plaintiff.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). Landowners’ RICO
claims fail because they have not put forth evidence that raises a genuine issue of
material fact as to whether Magner engaged in “conduct of an enterprise.”
Finally, the Landowners have put forth no evidence that any City employee
entered into a requisite agreement to participate directly or indirectly, in the affairs
Brief continued said... of an enterprise through the commission of two or more predicate crimes.
Bennett, 44 F.3d at 1374. Therefore, the Landowners’ RICO conspiracy claim
fails and, therefore, was correctly dismissed by the district court.
D. State Law Claims
Gallagher Landowners alleged that the district court erred when it granted
the City’s motion for summary judgment regarding Gallagher Landowners’ state
law claims. Steinhauser and Harrilal Landowners have not challenged the district
court’s decision to dismiss their state law claims. See Steinhauser/Harrilal Br. p.
2. Therefore, the City only responds to Gallagher’s Landowners’ appeal of the
district court’s dismissal of state law claims.
Gallagher Landowners made three state law claims: (1) abuse of process, (2)
tortious interference with contract; and (3) tortious interference with plaintiff’s
business expectancy. The City agrees with Gallagher Landowners’ reiteration of
the elements of each of the state law cause of action. Gallagher Br. pp. 56, 57.
However, Gallagher Landowners have offered no evidence in support of their state
law claims other than the conclusory statement that the City’s actions are “exactly
the type of evidence plaintiffs rely on in support of their state law claims.”
Gallagher Br. p. 57. Since Gallagher Landowners did not provide evidence in
support of any of their state law claims to the district court, nor do Gallagher
Landowners take this opportunity on appeal to provide any evidence to support
12 Steinhauser and Harrilal Landowners have not appealed the district
court’s Order denying the Landowners’ motion to compel City employee Steve
Magner’s personal records.
57
their state law claims, the district court properly dismissed their claim and its
decision should be affirmed.
II. THE DISTRICT COURT DID NOT ABUSE ITS DISCRETION
WHEN IT RULED ON THE LANDOWNERS’ NONDISPOSITIVE
MOTIONS AND THEREFORE THE COURT’S ORDERS SHOULD
BE AFFIRMED
The Landowners claim that the district court abused its discretion when it
denied their motion to compel and their motion (and renewed motion) for
sanctions. Such decisions should only be reversed on appeal if there is evidence
that the district court abused its discretion. Since the district court did not abuse
its discretion, its decisions should be affirmed.
A. Motion to Compel
The Gallagher Landowners allege that the district court erred when it denied
their motion to compel City employee Steve Magner’s personal records.
Gallagher’s Br. pp. 59-63.12 The district court’s Order denying Gallagher
Landowners’ motion to compel is reviewed very narrowly and should be upheld,
unless there was a gross abuse of discretion. Derby, 45 F.3d at 1215. Gallagher
Landowners claim that they need City employee Magner’s personal records as
further evidence that he committed a RICO predicate act of “attempted extortion”
Brief continued said... and “extortion.” Throughout many years of discovery, Gallagher Landowners had
every opportunity to gather information to support their claim that City employee
Magner had engaged in “attempted extortion” or “extortion” in violation of the
RICO Act. Gallagher Landowners’ complete lack of evidence provided ample
reason for Magistrate Judge Susan Richard Nelson to find that the “plaintiffs have
produced absolutely no evidence that [Magner] has derived any income from the
alleged pattern of “racketeering.” Gallagher ADD 000081.
There is absolutely no evidence that Magner received any income from any
source (Plaintiff or non-Plaintiff) as Gallagher Landowners allege. Furthermore,
to the extent that Gallagher Landowners claim that they needed bank records in an
effort to support a claim of “attempted extortion,” the City submits that any
attempt to gain funds would not be reflected in bank records. Therefore, there was
no gross abuse of discretion when the court denied Gallagher Landowners’ motion
to compel. Gallagher ADD 000079 - 000083.
B. Motions for Sanctions and Renewed Motions for Sanctions
In an Order dated November 13, 2007, the Honorable Susan Richard
Nelson, denied the Landowners’ motion for sanctions against the City. Gallagher
ADD 000077. The Landowners objected to that Order and on January 3, 2008, the
district court affirmed the Magistrate Judge’s decision. Gallagher ADD 000077-
000078. The Landowners renewed their motion for sanctions and in a May 8,
Brief continued said... 2008, Order, Magistrate Judge Susan Richard Nelson denied the Landowners’
renewed motion for sanctions. Gallagher ADD 000055. The Landowners
objected to that Order and on June 12, 2008, the district court affirmed the
Magistrate Judge’s decision. Gallagher ADD 000065.
The district court’s decision to issue [or not issue] sanctions for discovery
abuse is reviewed using the “abuse of discretion standard.” Baker, 86 F.3d at 816.
The district court did not abuse its discretion when it denied the Landowners’
motions for sanctions. Sanctions for spoliation may not be imposed “until the
moving party can demonstrate they have suffered prejudice as a result of the
spoliation.” E*trade Secs. LLC v. Deutsche Bank AG,, 230 F.R.D. 589, 592 (D.
Minn. 2005) (citing Stevenson v. Union Pac. R.R. Co., 354 F.3d 739, 748 (8th Cir.
2004) (“There must be a finding of prejudice to the opposing party before
imposing sanction for destruction of evidence.”)).
The district court correctly found that the Landowners did not show the
destruction or failure to produce TISH reports had prejudiced them. The
Landowners did not request the reports until 2007, and in response to that request,
the City produced all of the reports in its possession to Landowners.13 Gallagher
It is important to no 13 te that the TISH reports are not City documents
but documents created by TISH evaluators, who are not City employees. The City
only holds the documents for a set time period because it is the licensing agency
for the TISH evaluators. The City’s code enforcement has nothing to do with the
private TISH evaluators or the reports that they create.
ADD 000064. The Landowners requested sanctions based on the destruction of
earlier reports that were destroyed pursuant to the City’s valid document retention
policy. However, the City provided the Landowners all the information the
Landowners needed to obtain the missing TISH reports directly from the TISH
evaluators (who are not City employees). The Landowners are the ones who
independently decided they did not need the reports. The district court correctly
found that the Landowners simply did not show prejudice based on the City’s
destruction of TISH. Because the district court did not abuse its discretion in
denying Landowners’ motion for sanctions regarding the TISH reports, the district
court’s decision should be upheld.
The Landowners also resurrect their allegations that the City should be
sanctioned for failing to disclose emails.14 Gallagher Landowners’ Br. p. 59 and
Steinhauser and Harrilal Br. p. 59. Again, the Landowners provided no evidence
to support that they were prejudiced by the City’s disclosure of emails. Regarding
the individual email counts of which the Landowners complained: Susan
Kimberly, Kathy Lantry and Andy Dawkins, the Landowners provided no
evidence other than mere speculation claiming that more emails should exist.
Brief conclusion said... The City disclosed over 1 million email files throughout discovery. 14
When the City was unable to retrieve email files due to technical constraints, it
hired national data recovery firm Kroll Ontrack to retrieve those emails and
produce them to the Landowners.
Steinhauser/Harrilal ADD 000066 and 000067. Furthermore, the Landowners did
not provide any evidence that allegedly deleted emails would have information
favorable to their case.
With respect to the Landowners’ claim that the City should be sanctioned
for not retaining more pre-December 2005, emails, the district court correctly
found that the Landowners did not provide any evidence of being prejudiced by
any destruction of emails. In an effort to show prejudice, the Landowners made
only conclusory assertions which were no more than mere speculation that
destroyed emails would have contained evidence to their claims. Steinhauser and
Gallagher ADD at 000067. The district court correctly found that the
Landowners’ conclusory statements do not satisfy the requirements that the
Landowners show prejudice. The district court did not abuse its discretion in
denying the Landowners’ motion for sanctions (and renewed motion for sanctions)
and, therefore, the district court’s decisions should be affirmed.
62
CONCLUSION
For the above reasons, the City respectfully requests this Court to affirm the
district court’s decisions granting the City summary judgment and denying the
Landowners’ non-dispositive motions.
Date: July 14, 2009 JOHN J. CHOI
Saint Paul City Attorney
By: _______________________________
LOUISE TOSCANO SEEBA, #292047
Assistant City Attorney
750 City Hall and Courthouse
15 West Kellogg Boulevard
St. Paul, MN 55102
(651) 266-8772
Attorneys for Appellees
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