Bellino Fireworks, Inc. v. City of Ankeny
Bellino Fireworks, Inc. v. City of Ankeny
Opinion of the Court
I. INTRODUCTION
In May 2017, Iowa enacted legislation permitting the sale and use of consumer fireworks for two designated periods each year. Shortly thereafter, several Iowa cities enacted various ordinances regulating firework sales. A Nebraska corporation in the business of selling fireworks, Bellino Fireworks, Inc., brings this lawsuit against four cities requesting declaratory judgments that their ordinances are preempted by Iowa law, alleging the ordinances violate
*1078The City of Ankeny, the City of Boone, the City of Johnston, and the City of Pleasant Hill
As further explained below, the Court grants the Cities' motions for summary judgment, and denies Bellino's Motion for Partial Summary Judgment and the Cities' Motion to Continue or Bifurcate. The Cities' Ordinances are not preempted and summary judgment in the Cities' favor as to the declaratory judgment counts is thus appropriate. Bellino lacks standing to challenge the miscellaneous portions of the Cities' codes because it has not alleged it was injured by these provisions and fails to present an actual controversy. There are no genuine issues of material fact as to whether the Cities committed any substantive due process violations. Additionally, summary judgment in the Cities' favor on the tortious inference with contract and tortious interference with prospective business relationship claims is appropriate because the Cities' interference was not improper and, alternatively, the Cities are entitled to immunity under the discretionary function exception. Because the Court rules in the Cities' favor as to all claims, it does not consider the arguments regarding punitive damages and finds the Cities' motions to continue or bifurcate the trial are moot.
II. SUMMARY OF RELEVANT FACTS
The Court set forth the relevant facts in its Order granting in part and denying in part Bellino's Motion for a Preliminary Injunction. ECF No. 23 at 2-5. Since that time, the Cities' Ordinances have been amended, the Senate File has been codified, and Bellino has amended its complaint. Accordingly, the Court recites the relevant facts at this juncture. In large part, the parties agree there are no material facts in dispute.
On May 9, 2017, the Governor of Iowa signed into law Senate File 489 (SF 489), amending the Iowa Code to allow for the possession, sale, transfer, purchase, and use of consumer fireworks in the State of Iowa. 2017 Iowa Legis. Serv. Ch. 115 (S.F. 489) (West) (codified at
Sales are permitted only during two specific time periods-June 1 to July 8, and December 10 to January 3.
On May 26, 2017, and as directed by the legislature in SF 489, the state fire marshal adopted emergency rules to regulate fireworks in Iowa. ECF No. 56-3 at App. 18-35 (the Emergency Rules); see also
Bellino contends the Ordinances are not only preempted by SF 489, but also by House File 295 (HF 295). See Am. Compl. ¶ 1, ECF No. 45; 2017 Iowa Legis. Serv. H.F. 295 (West). Enacted March 30, 2017, HF 295 restricts counties' and cities' regulation of "consumer merchandise." ECF No. 45 ¶¶ 17-19. It is not fireworks-specific. House File 295 provides in pertinent part: "A city [or county] shall not adopt an ordinance, motion, resolution, or amendment that sets standards or requirements regarding the sale or marketing of consumer merchandise that are different from, or in addition to, any requirement established by state law." HF 295 § 3 (codified at
Senate File 489 provides Iowa cities "may by ordinance or resolution prohibit or limit the use of consumer fireworks, display fireworks, or novelties." SF 489 § 8 (codified at
Ankeny's Ordinance 1925-which amended Ordinance 1917-is currently in effect and "governs fireworks sales." Ankeny & Pleasant Hill's Ans. to Am. Compl. ¶ 36, ECF No. 50; Bellino's Statement Undisputed Material Facts Supp. Bellino's Mot. Partial Summ. J. ¶ 59, ECF No. 56-1 (acknowledging the City of Ankeny passed Ordinance 1925 in October 2017); see also Bellino's Ex. 7 Supp. Am. Compl., ECF No. 45-7 (setting forth Ordinance 1917). Ordinance 1925 limits fireworks sales to heavy industrial (M-2) districts. See Ankeny & Pleasant Hill's Ex. A Supp. Ans. to Am. Compl., ECF No. 50-1 (setting forth Ordinance 1925).
Boone's Ordinance 2237 eliminates the prior total ban on fireworks sales. Compare ECF No. 56-3 at App. 64-65, with Bellino's Ex. 9 Supp. Compl., ECF No. 1-10 (setting forth the prior version of Boone City Code § 41.12, which stated "[i]t is unlawful for any person to offer for sale, *1080expose for sale, sell at retail, or use or explode any fireworks"). The parties do not dispute Boone's current ordinance limits the sale of fireworks to industrial and commercial zones. Bellino's Resp. Boone & Johnston's Statement Undisputed Material Facts ¶ 36, ECF No. 74-2 (agreeing "Boone has allowed state-licensed consumer firework retailers to operate in industrial or commercial zones" but responding Boone only allowed Bellino to operate for a few days during the summer 2017 selling season).
Johnston Ordinance 979 amends the Johnston City Code and eliminates Johnston's prior total ban on fireworks sales. See Boone & Johnston's Statement Undisputed Material Facts Supp. Boone & Johnston's Mot. Summ. J. ¶ 26, ECF No. 57-1; ECF No. 74-2 ¶ 26; see also Boone & Johnston's Second Suppl. App. Supp. Resist. Bellino's Mot. Partial Summ. J. 001-002, ECF No. 80-2 (setting forth the prior version of Johnston City Code § 41.12). Ordinance 979 states it is "unlawful without a state issued license and a city issued Certificate of Zoning Compliance for any person to offer for sale, consumer fireworks within the corporate limits of the city." ECF No. 56-3 at App. 99. The procedure for obtaining a Certificate of Zoning Compliance is set forth in Johnston Code section 166.05.
Pleasant Hill's Ordinance 836 limits "[t]he sale or display of fireworks" to "[industrial] zoning districts." Ankeny & Pleasant Hill's App. Supp. Ankeny & Pleasant Hill's Mot. Summ. J. APHA 46, ECF No. 54-2. The Ordinance amends a prior ordinance banning the sale of fireworks. Compare ECF No. 54-2 at APHA 42-44 (Ordinance 827), and Bellino's Ex. 22 Supp. Am. Compl., ECF No. 45-22 (Ordinance 833), with ECF No. 54-2 at APHA 45-47 (Ordinance 836).
Soon after SF 489's passage in May 2017, Bellino Fireworks, Inc., applied for *1081licenses to sell consumer fireworks during the 2017 Fourth of July season. ECF No. 45 ¶ 3. Bellino is a Nebraska corporation in the business of retail fireworks sales.
Four days after filing this suit, Bellino requested a preliminary injunction against the Cities. ECF No. 8. After a hearing, the Court denied in part and granted in part Bellino's motion. ECF No. 23. The Court granted the injunction as to Ankeny's requirement for a special use permit, Boone's temporary structures ban, Johnston's temporary use permit, and Pleasant Hill's temporary structures ban, special sales permit requirement, and additional insurance coverage requirements.
The parties have filed cross-motions for summary judgment. ECF Nos. 54, 56, 57. These motions came before the Court for hearing on January 25, 2018. Hr'g Mins. Mots. Summ. J., ECF No. 91. Attorneys Hugh Cain and Eric Updegraff appeared on behalf of Ankeny and Pleasant Hill.
III. SUMMARY JUDGMENT STANDARD
Under Federal Rule of Civil Procedure 56(c), the Court must grant a party's motion for summary judgment if there are no genuine issues of material fact in dispute and the moving party is entitled to judgment as a matter of law. Celotex Corp. v. Catrett ,
To defeat a motion for summary judgment, the non-moving party "may not rest upon the mere allegations or denials of his pleading, but ... must set forth specific facts showing that there is a genuine issue for trial." Anderson , 477 U.S. at 248,
IV. DISCUSSION
Bellino requests partial summary judgment in its favor on its declaratory judgment claims. ECF No. 56. The Cities request summary judgment in their favor as to all claims. ECF Nos. 54, 57. The Court first addresses the parties' arguments as to the declaratory judgment claims. The Court concludes there are no material facts in dispute as to the declaratory judgment claims and judgment in the Cities' favor is appropriate. The Cities' Ordinances currently in effect are not preempted by state law. Additionally, Bellino lacks standing to challenge the other provisions of the Cities' codes because it does not allege an actual controversy for the Court to resolve. Second, the Court addresses Bellino's § 1983 claims against the Cities. The Court concludes the § 1983 claims fail because Bellino does not allege a substantive due process violation sufficient to support such claims. Lastly, the Court concludes there are no material facts in dispute supporting Bellino's tortious interference claims because the Cities' actions were not improper and, alternatively, the Cities are immune. Because the Court resolves these claims in the Cities' favor, Bellino's punitive damages claims are moot. The Cities' motions to continue or bifurcate the trial are also moot.
A. Declaratory Judgment Claims (Counts I, V, IX, XIII)
All parties request summary judgment as to Bellino's declaratory judgment claims. Bellino asserts the Cities' Ordinances impermissibly regulate the sale of consumer fireworks because state law preempts the Ordinances. ECF No. 45 ¶¶ 83-86, 107-110, 131-34, 155-58. The Cities argue state law does not preempt their Ordinances. Ankeny & Pleasant Hill's Br. Supp. Ankeny & Pleasant Hill's Mot. Summ. J. 8-18, ECF No. 63; Boone & Johnston's Br. Supp. Boone & Johnston's Mot. Summ. J. 23-29, ECF No. 64; Ankeny & Pleasant Hill's Br. Supp. Resist. Bellino's Mot. Partial Summ. J. 5-24, ECF No. 71-1; Boone & Johnston Br. Resist. Bellino's Mot. Partial Summ. J. 5-19, ECF No. 72.
In 1968, Iowa amended its constitution to recognize the concept of legislative "home rule." Madden v. City of Iowa City ,
Municipal corporations are granted home rule power and authority, not inconsistent with the laws of the general assembly, to determine their local affairs and government .... The rule or proposition *1083that a municipal corporation possesses and can exercise only those powers granted in express words is not a part of the law of this state.
Iowa Const. art. III, § 38A ; see also
The Iowa Supreme Court has recognized different forms of preemption: express preemption and implied preemption, which includes conflict preemption and field preemption. Mall Real Estate ,
For conflict preemption to apply, an "ordinance must be 'irreconcilable' with state law." Madden ,
Preemption under the doctrine of field preemption "occurs when the legislature has 'so covered a subject by statute as to demonstrate a legislative intent that regulation in the field is preempted by state law.' " Hensler ,
In ruling on Bellino's motion for a preliminary injunction, the Court considered whether SF 489 and HF 295 preempt the Cities' Ordinances under the likelihood of success on the merits prong. ECF No. 23 at 6-34. The Court concluded Bellino was likely to succeed as to its claims challenging:
*1084"1) Boone's and Pleasant Hill's temporary-structures bans, 2) Ankeny's, Johnston's, and Pleasant Hill's additional permit requirements, and 3) Pleasant Hill's insurance requirements." Id. at 33. The Court found these ordinances were likely expressly preempted under HF 295 or preempted by the doctrine of conflict preemption. Id. at 16-24. The Court also concluded "Bellino [was] unlikely to succeed on the merits of its claim field preemption prohibits the cities from regulating consumer merchandise or fireworks." Id. at 15. Additionally, the Court held Bellino was "unlikely to succeed on the merits of its claims challenging Ankeny's and Pleasant Hill's zoning ordinances." Id. at 33. The Court emphasized these findings were not binding. Id. at 34 (citing Univ. of Tex. v. Camenisch ,
The Court addresses the declaratory judgment claim for each of the Cities individually and concludes the Ordinances are not preempted and thus the Cities are entitled to summary judgment in their favor on those counts. The Court also holds Bellino does not have standing to challenge the miscellaneous portions of the Cities' Ordinances as Bellino does not present an actual controversy based on any concrete injury.
1. Ankeny (Count I)
The Court first notes any challenges to Ankeny's Ordinance 1917 are moot because Ordinance 1925 repealed Ordinance 1917. Ankeny & Pleasant Hill's Statement Undisputed Material Facts Supp. Ankeny & Pleasant Hill's Mot. Summ. J. ¶¶ 4-7, ECF No. 54-1; Bellino's Resp. Ankeny & Pleasant Hill's Statement Undisputed Material Facts ¶¶ 4-7, ECF No. 74-1 (admitting Ordinance 1925 amended Ordinance 1917); see also ECF No. 45-7 (Ordinance 1917). Ankeny's Ordinance 1925 limits fireworks sales to heavy industrial (M-2) districts. See ECF No. 50-1. Sales are allowed in M-2 districts "outright and without approval of a Special Use Permit." ECF No. 63 at 4 (quoting Jensen Aff., ECF No. 54-2 at APHA 49-52 (quoting in part Ankeny Code § 192.13) ). The Court first considers the zoning portion of Ankeny's Ordinances limiting the sale of fireworks to M-2 districts and then turns to the other portions of Ankeny's Ordinances.
a. Zoning requirement
Bellino challenges Ankeny's Ordinance as it relates to zoning. It asks to Court to find "[a]ll municipal regulation of the sale of consumer fireworks is preempted by State law." Bellino's Br. Supp. Mot. Partial Summ. J. 4, ECF No. 56-2 (emphasis removed). Bellino states even zoning laws "set[ ] standards or requirements regarding the sale or marketing of consumer merchandise that are different from, or in addition to, any requirement established by state law," and therefore are expressly preempted. Id. at 6 (quoting HF 295 (codified at
The Court holds Ankeny's Ordinance allowing the sale of fireworks only in heavy industrial zones is not preempted by SF 489 or HF 295. As there are no material facts in dispute, this legal question is appropriately resolved on summary judgment. Fed. R. Civ. P. 56(a) (stating summary judgment is appropriately grated when "the movant is entitled to judgment as a matter of law"); Anderson , 477 U.S. at 248,
i. Express preemption
As the Court preliminarily concluded, by their terms, neither SF 489 nor HF 295 expressly preempt Ankeny's Ordinance. Zoning is a well-established municipal function. See Iowa Code ch. 414; accord Residential & Agric. Advisory Comm., LLC v. Dyersville City Council ,
ii. Conflict preemption
In support of its conflict preemption argument, Bellino cites its expert's report concluding the Ordinances "are more restrictive than [National Fire Protection Association standard] 1124" and "exceed the regulations adopted by the State of Iowa and are not necessary to provide a reasonable level of fire and life safety for buildings and structures in which consumer fireworks are sold, including temporary structures." Bellino's Suppl. Sealed App. Supp. Bellino's Mot. Partial Summ. J. at Supp. App. 24, ECF No. 75. Bellino also argues the National Fire Protection Association standard 1124 is incorporated into the state fire marshal's rules and that standard 1124 itself allows sales broadly in "mercantile occupancies." ECF No. 56-2 at 9-10 (quoting language from the standard which states "[r]etail sales of consumer fireworks shall be limited to mercantile occupancies" defined as "[a]n occupancy used for the display and sale of merchandise"); see also ECF No. 56-3 at App. 249-319 (setting forth National Fire Protection Association standard 1124). Bellino concludes the incorporation of standard 1124 into the Iowa Code and the broad language of standard 1124 demonstrates the legislature's desire to allow the sale of consumer fireworks "without limitation on location" and that the issuance of a license "shall allow the licensee to sell"
*1086consumer fireworks in Iowa. ECF No. 56-2 at 10 (quoting in part
Neither SF 489 nor HF 295 conflict with Ankeny's Ordinance as it relates to zoning. Ankeny's Ordinance is not " 'irreconcilable' with state law." Madden ,
iii. Field preemption
Finally, the Court finds Ankeny's Ordinance is not preempted under the doctrine of field preemption. ECF No. 23 at 13-15. The Court finds no "persuasive concrete evidence of an intent to preempt the field in the language that the legislature actually chose to employ." Seymour ,
b. Other requirements
Bellino additionally challenges other provisions of Ankeny's City Code:
*1087the site plan requirement, occupancy permit requirements, parking and loading requirements, nuisance abatement, additional setbacks, regulations of the storage of supplies, and area and size regulations. ECF No. 45 ¶¶ 37-38 (citing Ankeny Code §§ 192.02, 192.13(2)(A)-(C), 192.13(3)-(4), ECF No. 56-3 at App. 60-62); ECF No. 56-2 at 13 (citing Ankeny Code §§ 192.02, 192.13(1), 192.13(2)(C), 192.13(4) ). Ankeny argues Bellino lacks standing to challenge these other provisions of Ankeny's City Code because Bellino does not raise an actual controversy. ECF No. 63 at 20-24.
Declaratory judgment actions require an "actual controversy" between "interested" parties.
In the context of standing, Ankeny frames Bellino's challenge as a facial, rather than an as-applied, challenge and concludes it is too speculative. ECF No. 63 at 21-23. Ankeny contends Bellino cannot bring an as-applied challenge because Bellino has not "experience[d] a direct injury or will [not] soon sustain a direct injury."
*1088Id. at 22 (first alteration in original) (quoting Dolls, Inc. ,
The parties' arguments converge when focusing on Bellino's injury. In arguing Bellino brings a facial challenge against these provisions, Ankeny essentially alleges Bellino lacks an injury sufficient to bring a declaratory judgment claim. As stated above, declaratory judgment actions do not eliminate Article III requirements; there must be an actual controversy for this Court to adjudicate a claim.
Here, Bellino has not shown there is an actual controversy for the Court to resolve. Bellino does not allege any of the miscellaneous provisions it challenges-the site plan, the occupancy permit, the parking and loading requirements, the setback requirement-have caused it any injury. Bellino presents no evidence these other portions of Ankeny's City Code have been applied to it. Bellino argues these "other provisions of Ankeny Code appear to apply to consumer firework sales." ECF No. 74-1 ¶¶ 7, 10-11 (emphasis added); see also id. ¶¶ 21, 28, 37 (stating "other provisions [in] Pleasant Hill Code appear to apply to [the sale of] consumer fireworks" (citing ECF No. 56-1 ¶¶ 99-108) ); ECF No. 74-2 ¶ 23 (stating the same as to Johnston's other provisions); id. ¶ 42 (arguing other provisions may be applicable to Bellino's current Boone location). This response further demonstrates that Bellino fails to present an actual controversy as to these miscellaneous provisions.
Additionally, Bellino affirms it is not raising a constitutional challenge to these provisions and thus the Court need not analyze whether the challenged provisions of Ankeny's City Code are facially invalid or have been selectively enforced. See ECF No. 74 at 7 ("Bellino is not challenging the constitutionality of the Cities' ordinances as part of its declaratory judgment claims. To the contrary, Bellino's declaratory judgment claims are focused on the extent to which the Cities' requirements are preempted under Iowa State law." (emphasis in original) ); see, e.g., City of Chicago v. Morales ,
Furthermore, even assuming Bellino has standing, the specific municipal provisions Bellino seeks to challenge are not " 'irreconcilable' with state law," Madden ,
2. Boone (Count V)
Boone's Ordinance limits the sale of fireworks to commercial or industrial zones. See ECF No. 56-3 at App. 64; ECF No. 74-2 ¶ 36; see also Boone & Johnston's App. Supp. Boone & Johnston's Mot. Summ. J. at. App. 109, Skare Aff. ¶ 6, ECF No. 58. Bellino also challenges the provisions of Boone's City Code allowing for temporary structures, requiring the submission of a site plan, banning of certain outdoor displays, and requiring height, yard depth and width, parking, and construction compliance. ECF No. 45 ¶ 49; see also ECF No. 56-3 at App. 66-96 (setting forth selected portions of Boone's City Code Chapter 175).
a. Zoning requirement
For the reasons the Court explained in analyzing Ankeny's zoning requirement, Boone's Ordinance as it relates to zoning is *1090not preempted by state law under express, conflict, or field preemption. See supra IV.A.1.a. The Court finds there is no language in SF 489 or HF 295 prohibiting or limiting Boone's zoning power. Boone's zoning ordinance is not irreconcilable with state law. The legislature did not use language indicating an intent to occupy the entire field of consumer merchandise or consumer fireworks. Therefore, as a matter of law, the Court grants summary judgment in Boone's favor as to its zoning ordinance.
b. Temporary structures requirements
Bellino states Boone City Code sections 175.16(1)(A), 175.17(1)(B), and 175.18(1)(B) prohibit sales from temporary structures. ECF No. 45 ¶ 49. These sections set forth permitted uses in C-1, C-2, and C-3 districts and permit retail business in these districts "provided that all goods offered for sale shall be kept or stored within a fully enclosed building." ECF No. 56-3 at App. 66, 70, 74 (setting forth Boone City Code §§ 175.16(1)(A), 175.17(1)(B), 175.18(1)(B) ). Boone states temporary use structures are permitted in the C-3 zoning district. ECF No. 57-1 ¶ 34; ECF No. 74-2 ¶ 34 (acknowledging Bellino "was able to open a temporary structure ... for several days in 2017"); see also ECF No. 56-3 at App. 74, 77 (setting forth Boone City Code § 175.18(1)(B), (11) ).
Boone has not changed its Ordinance since the Court's Order enjoining its temporary structures ban. Compare Bellino's Ex. 13 Supp. Compl., ECF No. 1-13, with Bellino's Ex. 18 Supp. Am. Compl., ECF No. 45-18; see also ECF No. 64 at 7 n.2 (asserting Boone has adopted new interpretations of its Ordinance since the Court's preliminary injunction order). It is undisputed Bellino is required to submit a temporary use permit application and pay the associated $50 fee in order to operate out of a temporary structure in Boone. See Sanders Aff. ¶ 17, ECF No. 58 at App. 054-055. It is also undisputed Boone allows temporary structures in the C-3 zoning district. ECF No. 57-1 ¶ 34; ECF No. 74-2 ¶ 34.
The Court finds Boone's temporary structures requirement is not preempted under state law. When the Court issued its Order granting in part and denying in part the preliminary injunction, Boone did not (or the Court did not understand it to) have any sort of zoning ordinance related to the sale of fireworks. Boone now allows the sale of fireworks in commercial or industrial zones. See ECF No. 45-18; ECF No. 74-2 ¶ 36. It is undisputed temporary structures are allowed in Boone in at least one of the commercial zones (C-3). ECF No. 56-3 at App. 74, 77 (setting forth Boone City Code § 175.18(1)(B), (11) ); ECF No. 57-1 ¶ 34; ECF No. 74-2 ¶ 34. Thus, Boone does not prohibit consumer fireworks retailers from operating out of temporary structures. Cf. ECF No. 23 at 16-19. Boone's temporary structures ordinance is no longer irreconcilable with Iowa law and conflict preemption does not apply to bar its application. See id. at 2 (noting a court's findings of facts and conclusions of law in determining whether to grant an *1091injunction are not binding as they are based on "procedures that are less formal and evidence that is less complete than in a trial on the merits" (quoting Camenisch ,
c. Other requirements
As to the other provisions of Boone's City Code Bellino challenges-the site plan, the ban on outdoor displays, and the height, yard, parking, and construction requirements-Bellino has not demonstrated these provisions of Boone's City Code have been applied to it and does not allege an actual controversy for the Court to resolve. See ECF No. 45 ¶ 49; ECF No. 56-3 at App. 66-96 (setting forth selected portions of Boone's Code of Ordinances including the standards for special commercial, limited commercial, and mixed use districts). As with the Court's analysis of Bellino's challenge to other provisions of Ankeny's City Code, Bellino does not allege any of the miscellaneous provisions of Boone's City Code have caused it any injury and presents no evidence these provisions have been applied to it. See supra IV.A.1.b. Even assuming Belino has standing to challenge these laws, Bellino has not demonstrated a genuine dispute exists that these provisions are " 'irreconcilable' with state law," Madden ,
3. Johnston (Count IX)
Johnston's Ordinance does not contain any zoning ordinances pertaining to fireworks. ECF No. 56-3 at App. 97-99. Instead, Bellino challenges Johnston's requirement that retailers obtain a Certificate of Zoning Compliance and a temporary use permit. Bellino also challenges other provisions of Johnston's City Code, including "yard, open space, parking,[ ] loading space" lighting, landscaping, height, lot, temporary sign, and paved surfaces requirements, and requirements regarding "the outdoor display of merchandise," among others. ECF No. 45 ¶ 60.
a. Certificate of Zoning Compliance
Johnston affirms it requires "a state issued license and a city issued Certificate of Zoning Compliance for any person to offer for sale[ ] consumer fireworks within the corporate limits of the city." ECF No. 56-3 at App. 99;
No land shall be occupied or used, and no building hereafter erected or structurally altered shall be occupied or used in whole or in part for any purpose whatsoever, until there is a zoning certificate issued by the Zoning Administrator, stating that the use of the building and the site improvements comply with the provisions of this ordinance.
Johnston's requirement to obtain a Certificate of Zoning Compliance is not expressly preempted. Johnston's Certificate of Zoning Compliance is not a "standard[ ] or requirement[ ] regarding the sale or marketing of consumer merchandise that are different from, or in addition to" those provided under the state law. HF 295; cf. ECF No. 23 at 19-23 (stating Ankeny, Johnston, and Pleasant Hill's additional permit requirements were likely expressly preempted where the Cities "require Bellino, as a consumer fireworks retailer, to acquire additional city-issued permits to sell fireworks"); id. at 23-24 (concluding Pleasant Hill's insurance-requirements ordinance were likely expressly preempted by HF 295). Much like the Court's conclusion as to the Cities' zoning ordinances, *1092a zoning compliance certificate does not concern "the sale or marketing of consumer merchandise" but is instead a permit for the use of a building. See ECF No. 23 at 28. Under the doctrine of conflict preemption, Johnston's Certificate of Zoning Compliance is not " 'irreconcilable' with state law." Madden ,
b. Temporary use permit
Bellino also challenges Johnston's requirement that retailers obtain a permit to operate out of a temporary structure within city limits. Temporary uses are permitted in Johnston in "all non-residential zoning districts." Bellino's Ex. 21 Supp. Am. Compl. § 173.05(1), ECF No. 45-21; accord ECF No. 57-1 ¶ 17; ECF No. 74-2 ¶ 17 (stating "Johnston has taken the position that a temporary use permit is required in [the commercial zoning] district-an approval process taking six weeks with multiple levels of approval required"). Johnston City Code section 173.02 states a temporary use is "[a]ny sales in any nonresidential district including, but not limited to the sales of fresh fruits/vegetables, baked goods, and hand crafted items." ECF No. 45-21 § 173.02(1). Temporary structures are defined as:
Any constructed or erected structure, including but not limited to a shed, building, vehicle, trailer, tent or enclosure of any kind used for commercial or business purposes which any person or business intends to place on the same lot with or on any lot adjacent to, any permanent structure used for business or commercial purposes.
The Johnston City Code Chapter entitled "Zoning-Temporary Uses" is not fireworks-specific. ECF No. 57-1 ¶ 18; ECF No. 74-2 ¶ 18. It does not mention any restrictions or rules relating to the sale of fireworks out of temporary structures. See generally ECF No. 45-21 at 108-12. Bellino has not requested a temporary use permit from Johnston, but Bellino has obtained a lease for a property in Johnston where temporary structures are permitted. ECF No. 57-1 ¶¶ 15-17, 24; ECF No. 74-2 *1093¶¶ 15-17, 24; see also Boone & Johnston's Sealed App. Supp. Boone & Johnston's Resist. Bellino's Mot. Partial Summ. J. at Supp. Summ. J. App. 004, ECF No. 73 (setting forth a diagram of the lease property in Johnston showing a tent).
Johnston's temporary use permit process is not expressly preempted under state law. See
Johnston's temporary use permit requirement is also not preempted under the doctrine of conflict preemption. Johnston's temporary structures permit process does not "prohibit[ ] what [the] state statute allows." Seymour ,
Johnston's temporary use permit requirement is likewise not preempted under the doctrine of field preemption. House File 295 does not indicate the legislature intended to so cover the field of "consumer *1094merchandise"-or in SF 489, consumer fireworks-as to preempt the field of regulation over this subject. Because Johnston's temporary use permit process is not preempted by state law, the Court grants summary judgment in Johnston's favor as to this Ordinance.
c. Other requirements
As to the other challenged provisions of Johnston's City Code, Bellino has not demonstrated these other provisions have been applied to it and does not allege an actual controversy for the Court to resolve. See ECF No. 45 ¶ 60 (setting forth challenges to selected portions of Johnston's City Code, including yard, open space, parking, loading, lighting, landscaping, height, lot, temporary sign, and paved surfaces requirements); ECF No. 56-3 at App. 97-212 (setting forth selected portions of Johnston's Code of Ordinances including the standards for zoning, sign regulations, site plan requirements, and temporary uses). As the Court concludes for the challenges Bellino brings to Ankeny's City Code, Bellino presents no evidence it has been injured by these provisions of Johnston's City Code. See supra IV.A.1.b. The Court grants summary judgment in Boone's favor as to the declaratory judgment count.
4. Pleasant Hill (Count XIII)
Similarly to Ankeny and Boone's ordinances, Pleasant Hill's Ordinance limits fireworks sales to industrial zoning districts. ECF No. 54-2 at APHA 46. As stated in the analysis above, such a zoning ordinance is not preempted by state law. See supra IV.A.1.a. Pleasant Hill's zoning ordinance does not concern "the sale or marketing of consumer merchandise that are different from, or in addition to, any requirement established by state law." HF 295. Pleasant Hill's ordinance is not irreconcilable with state law, nor is the ordinance preempted under the doctrine of field preemption.
Bellino has not demonstrated it has suffered any injury as a result of the other provisions of Pleasant Hill's City Code it challenges. See ECF No. 45 ¶ 72 (challenging provisions including "a required certificate issued by the Zoning Administrator,"
5. Conclusion
For the reasons set forth above, the Court grants summary judgment in favor of the Cities as to each declaratory judgment count. There are no genuine issues of material fact Bellino can point to showing the Cities' zoning ordinances are preempted. State law also does not preempt Boone's temporary structures requirements, *1095Johnston's Certificate of Zoning Compliance, or Johnston's temporary use permit requirement. Bellino present no actual controversy for the Court to resolve as to the Cities' other regulations.
The Court next considers Bellino's other claims against the Cities alleging: section § 1983 due process violations, tortious interference with contract, and tortious interference with prospective business relationships. The Court then considers Bellino's punitive damages request and the Cities' motions to continue or bifurcate.
B. Section 1983 Due Process Claims (Counts II, VI, X, XIV)
Bellino brings § 1983 substantive due process claims against the Cities. Bellino alleges the Cities denied it due process during the 2017 summer selling season by depriving Bellino the use of its licenses. ECF No. 45 ¶¶ 93-94, 117-118, 141-142, 165-166. The essential elements of a § 1983 due process claim are the deprivation of a constitutionally protected due process right by a defendant acting under color of state law. See Schmidt v. City of Bella Villa ,
A substantive due process claim is subject to a high burden. See Azam v. City of Columbia Heights ,
*1096
Bellino alleges the Cities violated its due process rights by: "denying Bellino's use of [licenses] from June 15, 2017, through [early July] 2017"; and enacting ordinances "not rationally related to a legitimate government interest" by setting "standards or requirements that are different from, or in addition to, those established by State law." ECF No. 45 ¶¶ 93, 94, 117, 118, 141, 142, 165, 166. In support of its position, Bellino cites its expert's report and conclusions that the Cities' Ordinances and regulations are more restrictive than those set forth by the National Fire Protection Association Code. ECF No. 74 at 10. Because Bellino alleges it was denied due process during the 2017 summer selling season, the Court must examine the ordinances in effect at the time of Bellino's alleged deprivation. The Court also examines the Ordinances currently in effect as Bellino generally challenges the Cities' enactment of ordinances preempted by state law. See ECF No. 45 ¶¶ 94, 118, 142, 166.
Assuming Bellino has a cognizable property interest, there are no material facts in dispute that the ordinances in effect during the 2017 summer selling seasons were truly irrational. Even when Boone and Johnston banned fireworks sales, see ECF No. 23 at 15-16, their ordinances did not shock the conscience, nor, under a lesser standard, were they arbitrary or capricious. Cf. Hensler ,
Furthermore, there are rational bases for the Cities' ordinances-both those in effect during the 2017 summer selling season and those currently in effect. See, e.g., PPC Enters. v. Texas City ,
C. Tortious Interference Claims (Counts III, IV, VII, VIII, XI, XII, XV, XVI)
The parties agree the Court should analyze Bellino's claims for tortious interference with contract and tortious interference with prospective business relationships jointly. See ECF No. 64 at 15-18; ECF No. 74 at 16. In order to demonstrate a prima facie case for tortious (intentional) interference with contract, Bellino must prove:
(1) plaintiff had a contract with a third-party; (2) defendant knew of the contract; (3) defendant intentionally and improperly interfered with the contract; (4) the interference caused the third-party not to perform, or made performance more burdensome or expensive; and (5) damage to the plaintiff resulted.
Green v. Racing Ass'n of Cent. Iowa ,
(a) the nature of the actor's conduct,
(b) the actor's motive,
(c) the interests of the other with which the actor's conduct interferes,
(d) the interests sought to be advanced by the actor,
(e) the social interests in protecting the freedom of action of the actor and the contractual interests of the other,
(f) the proximity or remoteness of the actor's conduct to the interference and
(g) the relations between the parties.
Restatement (Second) of Torts § 767 ;
The Cities make a variety of arguments regarding these claims. The Cities allege they are immune. ECF No. 63 at 29-30 (citing
The Court holds summary judgment on the tortious interference with contract and tortious interference with prospective business relationships claims is appropriate as a matter of law. The improper interference factors weigh in favor of judgment for the Cities and demonstrate their interference was not improper. Several of the Cities passed zoning ordinances, or ordinances akin to zoning ordinances. Zoning is a well-established municipal function. See Iowa Code ch. 414; accord Residential & Agric. Advisory Comm., LLC ,
The Court alternatively finds the Cities' actions in passing the Ordinances-both those currently and those previously in effect-are afforded immunity under Iowa's discretionary function immunity exception. See
*1099City of Cedar Falls v. Cedar Falls Cmty. Sch. Dist. ,
The Cities' action of passing ordinances related to zoning for the sale of consumer fireworks is a discretionary function and thus provides immunity to the Cities under the Iowa Code. Decisions such as passing an ordinance are the types of discretionary functions this exception is designed to protect. See Berkovitz ,
D. Punitive Damages
The Cities also argue punitive damages are unavailable against municipalities. ECF No. 63 at 35-36 (citing
E. Defendants' Motion to Bifurcate or Continue Trial
Finally, Ankeny and Pleasant Hill request the court continue the trial, or in the alternative bifurcate the trial. ECF No. 85. Boone and Johnston join in this request. ECF No. 87. The Cities request bifurcation of the merits and damages portions of the trial. ECF No. 85 ¶¶ 23-25; ECF No. 87. Because the Court rules in the Cities' favor as to all counts at summary judgment, the Cities' motions are moot and the Court need not address this issue.
F. Effect of the Court's Summary Judgment Ruling on the Preliminary Injunction and Bond
Having found summary judgment in Defendant Cities' favor as to all counts is appropriate, the Court must now determine the effect of the Court's ruling on the preliminary injunction and the $5000 bond Bellino posted. See ECF Nos. 23, 24. "When a law has been amended or repealed, actions seeking declaratory or injunctive relief for earlier versions are generally moot unless the problems are 'capable of repetition yet evad[ing] review.' " Phelps-Roper v. City of Manchester ,
As set forth in Federal Rule of Civil Procedure 65(c), the Court may, and did here, require a bond upon the issuance of a preliminary injunction for the payment of "costs and damages sustained by any party found to have been wrongfully enjoined." See also ECF Nos. 23, 24. None of the Cities request any amount of the bond. See ECF No. 54; ECF No. 57. Moreover, the Court does not find any party was wrongfully enjoined. Thus, the Court directs the Clerk to return the $5000 bond to Bellino.
*1101V. CONCLUSION
The Court concludes summary judgment is warranted in the Cities' favor as to all claims against them. Declaratory judgment in the Cities' favor is appropriate because the Ordinances are not preempted by SF 489 or HF 295 under the doctrines of express, conflict, or field preemption. Bellino lacks standing to assert challenges against other miscellaneous provisions of the Cities' codes because Bellino does not present an actual controversy for the Court's resolution and does not allege it sustained any injury as a result of these provisions. Summary judgment is also appropriate in favor of the Cities as to Bellino's § 1983 due process claims because there are no material facts in dispute that the ordinances violate Bellino's substantive due process rights. The same is true regarding Bellino's tortious interference with contract and prospective business relationships claims. Judgment as a matter of law is appropriate as to Bellino's tortious interference with contract and prospective business relationships claims because there are no allegations the Cities' interference was improper and, alternatively, the Cities actions are afforded discretionary function immunity. Lastly, the Court need not consider whether punitive damages are warranted or appropriate because the Court rules in the Cities' favor as to all counts. Because the Court resolves the claims on summary judgment, the Cities' request to continue or bifurcate trial is moot. The preliminary injunction is also moot and the bond shall be returned to Bellino.
IT IS SO ORDERED that Defendants' Motions for Summary Judgment, ECF Nos. 54 and 57, are GRANTED and Plaintiff's Motion for Partial Summary Judgment, ECF No. 56, is DENIED . Defendants' Motions to Continue or Bifurcate Trial, ECF Nos. 85 and 87, are DENIED .
Each party is responsible for its own costs. The $5000 bond previously paid by Plaintiff Bellino shall be returned to Plaintiff as the preliminary injunction is moot. See ECF Nos. 23, 24. The Clerk is directed to terminate this case in favor of the Defendants City of Ankeny, City of Boone, City of Johnston, and City of Pleasant Hill.
The Court refers to the City of Ankeny, the City of Boone, the City of Johnston, and the City of Pleasant Hill-all cities located in the Southern District of Iowa-collectively as "the Cities."
Because SF 489 (and HF 295) have been codified in scattered sections, the Court cites SF 489 and HF 295.
The parties do not point the Court to the exact language of the Boone Ordinance setting forth this limitation. However, the parties do not dispute Boone's Ordinance is limited to these zones. Boone & Johnston's Statement Undisputed Material Facts Supp. Boone & Johnston's Mot. Summ. J. ¶ 36, ECF No. 57-1; ECF No. 74-2 ¶ 36. Boone contends it has adopted new interpretations of its Ordinance following the Court's preliminary injunction order. Boone & Johnston's Br. Supp. Boone & Johnston's Mot. Summ. J. 7 n.2, ECF No. 64 (citing ECF No. 57-1 ¶ 36 (stating Boone allows "state-licensed consumer firework retailers to operate in industrial or commercial zones"); id. ¶ 37 (stating "Boone allows Bellino's temporary use pursuant to Boone Code sections 175.18(1)(B) and 175.18(11)"); id. ¶ 39 ("If a consumer firework retailer has obtained a state fireworks license, Boone will not require the retailer to obtain any other permit, certificate, or pay any fee to the City of Boone.") ). Thus, the Court treats this fact as undisputed.
There are remaining references in the materials to Pleasant Hill Ordinance 833. ECF No. 45 ¶¶ 70-71 (naming Ordinance 833); Ankeny & Pleasant Hill's Statement Undisputed Material Facts Supp. Ankeny & Pleasant Hill's Mot. Summ. J. ¶ 21, ECF No. 54-1 (same). However, the parties appear to agree Ordinance 836 is the "sole source of regulation on the sale of consumer fireworks in Pleasant Hill's Municipal Code." Bellino's Resp. Ankeny & Pleasant Hill's Statement Undisputed Material Facts ¶ 21, ECF No. 74-1 (quoting Sturms Aff., ECF No. 54-2 at APHA 54); Ankeny & Pleasant Hill's Reply Bellino's Resp. Statement Undisputed Material Facts ¶ 21, ECF No. 78-1; see also ECF No. 54-2 at APHA 46 ("All Ordinances or parts of Ordinances in conflict with the provisions of this Ordinance are hereby repealed.").
Because the parties make cross-motions for summary judgment as to the declaratory judgment counts, the Court considers the materials both in support of and in resistance to Bellino's Motion for Partial Summary Judgment, ECF No. 56, and the Cities' Motions for Summary Judgment, ECF Nos. 54, 57. Ankeny and Pleasant Hill submitted joint materials. Boone and Johnston submitted joint materials.
For the reasons stated in its order regarding the preliminary injunction, the Court declines to rely upon the legislative history in reaching its conclusion that Ankeny's (and the Cities') zoning ordinances are not preempted under the doctrine of conflict preemption. ECF No. 23 at 30; see also ECF No. 63 at 14-16 (setting forth quotations from floor debates on SF 489). The Court instead looks to the text of the statutes to determine legislative intent. ECF No. 23 at 30 (citing Mall Real Estate ,
Moreover, in responding to the Cities' arguments regarding the § 1983 claims, Bellino asserts "it is a disputed issue of material fact regarding which laws the Cities used or will use to prevent Bellino from selling consumer fireworks in accordance with State law." ECF No. 74 at 12. This further supports the finding Bellino does not have standing to challenge these other provisions. Such allegations are "conjectural" and inappropriate for the Court's judgment. See Susan B. Anthony List ,
While Bellino maintains "[t]here is nothing in Boone Code that purports to limit the applicability of the [C-1, C-2, and mixed use code sections] to Bellino's operations at the [C-3] location," the Court finds this assertion does not create a genuine issue of material fact. ECF No. 74-2 ¶ 42; see also Anda v. Wickes Furniture Co. ,
The Court notes that while Bellino has not obtained a temporary use permit, ECF No. 74-2 ¶ 24, it has demonstrated a "substantial risk that [a] harm will occur" sufficient to confer standing-here a lease to operate in a nonresidential zone at a location with a permanent structure, subject to the temporary use permit. Susan B. Anthony List ,
To the extent this is a separate required certificate, the Court finds Pleasant Hill's ordinance is akin to Johnston's Certificate of Zoning Compliance and is not preempted. See supra IV.A.3.a.
Bellino's complaint contends the Cities' Ordinances are "not rationally related to a legitimate government interest," nodding to the facial challenge standard. See ECF No. 45 ¶¶ 94, 118, 142, 166; see also Ankeny & Pleasant Hill's Reply Br. Supp. Mot. Supp. J. 4, ECF No. 84 (challenging Bellino's failure "to address the 'truly irrational' standard applied in rational basis analysis").
The Court reemphasizes that while the language of Boone's Ordinance has not changed, the parties agree the interpretation of Boone's Ordinance is to allow the sale of fireworks in industrial and commercial zones and that temporary structures are allowed in the C-3 zoning district. ECF No. 57-1 ¶¶ 34, 36; ECF No. 74-2 ¶¶ 34, 36; see also ECF No. 56-3 at App. 74, 77 (setting forth Boone City Code § 175.18(1)(B), (11) ).
Reference
- Full Case Name
- BELLINO FIREWORKS, INC. v. CITY OF ANKENY, IOWA, City of Boone, Iowa, City of Johnston, Iowa, and City of Pleasant Hill, Iowa
- Cited By
- 3 cases
- Status
- Published