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Pacific Community Resource Center v. City of Glendale

United States District Court, D. Oregon

August 3, 2017

PACIFIC COMMUNITY RESOURCE CENTER, Plaintiffs,
v.
CITY OF GLENDALE, OREGON, Defendants.

          OPINION AND ORDER

          Michael J. McShane United States District Judge

         Plaintiffs Michael Cassidy and Anthony Schlauch operated a seventeen room motel in the City of Glendale's commercial zone as long-term multi-family residential housing. They have done so without obtaining an R-2 Certificate of Occupancy or a Conditional Use Permit as required by city ordinance. As a consequence, the City assessed civil penalties on the motel's property owner, Cow Creek Properties, LLC. In turn, Cow Creek Properties brought an eviction complaint (Commercial FED) against Pacific Community Resource Center.

         Plaintiffs Michael Cassidy, Anthony Schlauch and Pacific Community Resource Center now bring this lawsuit alleging a violation of their due process rights and improper taking of property. Plaintiffs have named as defendants: (1) the City of Glendale and fifteen current and former city officials to include the mayor, council members, and city's compliance officer; (2) Ryan Kirchoff, the attorney who represented Cow Creek Properties in the underlying eviction proceeding; and (3) three sitting Douglas County Circuit Court judges, Douglas County, and State of Oregon for their actions in adjudicating over the multiple state proceedings.

         Before this Court are four motions: Plaintiffs' Motion for Summary Judgment (ECF No. 34); Defendants Larry Caldwell and Allen King's Motion for Summary Judgment (ECF No. 19 & 20); Defendants Douglas County Circuit Court Judges, Courts and State of Oregon's Motion to Dismiss (ECF No. 12); and Defendant Ryan Kirchoff's Motion to Dismiss (ECF No. 46).

         Because plaintiffs' Motion for Summary Judgment fails to demonstrate how specific facts entitle them to judgment as a matter of law, plaintiff's motion is DENIED.

         Because the Rooker-Feldman doctrine precludes a federal district court from reviewing either the constitutionality or legal correctness of a state court decision, Defendants Larry Caldwell and Allen King's Motion for Summary is GRANTED as is the Motion to Dismiss filed by the State, the judges, and the courts. Judges and Courts are also entitled to Eleventh Amendment and judicial immunity.

         Because plaintiffs' claims against defendant Ryan Kirchoff fall within the ORS 31.150(2) anti-SLAPP provision, Defendant Ryan Kirchoff's Motion to Dismiss is GRANTED and those claims are stricken and dismissed. Kirchoff is awarded his attorney fees and costs pursuant to ORS 31.152(3).

         Because the Rooker-Feldman doctrine applies equally to the claims asserted against the remaining defendants who have not yet been served or appeared, all remaining claims are DISMISSED sua sponte without leave to amend.

         FACTUAL BACKGROUND

         In 2009 Pacific Community Resource Center entered in a performance contract to purchase a motel located in the City of Glendale's commercial zone at 127 Pacific Ave., Glendale, Oregon from Gary Martin and Cow Creek Properties, LLC. 2d Am. Compl. 5-7, ECF No. 10. Shortly thereafter, plaintiff Cassidy approached the City of Glendale to obtain permission to rent rooms to small businesses. The City agreed but did not require Pacific Community to affect a change in the use and occupancy classification with the Douglas County Building Department.

         On or about September 11, 2011, plaintiff Cassidy approached the City with regard to operating the motel as multi-family residential housing. Opinion and Order 3; ECF No. 108, Pacific Community Resource Center, v. City of Glendale, Oregon, , Case No. 6:13-cv-1272-MC. He learned that to operate as multi-family residential housing it would be necessary for the motel to obtain an R-2 Certificate of Occupancy or a Conditional Use Permit. Plaintiffs alleged that the City responded by telling them that an R-2 certificate was not available to them and that the City did not want their “kind of people” in town.

         On or about October 21, 2011, the City sent a letter to Pacific Community indicating that Pacific Community was in potential violation of ordinances regarding residential use in a commercial zone. Pacific Community communicated with the City Council multiple times to discuss zoning compliance alternatives, but the two parties were unable to reach an agreement.

         On or about December 3, 2011, plaintiff Cassidy received notice for a zoning ordinance violation from the City of Glendale. Cassidy contested this violation but was ultimately convicted at trial before a state circuit court judge on or about May 10, 2012, for operating the motel as multi-family residential housing without first obtaining an R-2 Certificate of Occupancy or a Conditional Use Permit.

         Pacific Community then attempted to obtain an R-2 Certificate of Occupancy by initiating a series of inspections with the State Fire Marshall. The first inspection (February 24, 2012), resulted in a report identifying eleven deficiencies. A subsequent inspection on May 10, 2012, resulted in a report showing that ten deficiencies were resolved and that the only remaining deficiency “was failure to obtain a certificate of occupancy” (COO). On May 11, 2012, Pacific Community approached the City to acquire a COO sign-off. City officials refused to provide plaintiffs with this sign-off. As a result, Douglas County did not issue the R-2 COO to plaintiffs.

         On April 9, 2012 while Pacific Community was working to obtain an R-2 Certificate of Occupancy, the City Council unanimously adopted ordinance GMO 03-2012 which removed multi-family residential housing from the permitted uses in the City's commercial zone. 2d Am. Compl. 6, ECF No. 10. Plaintiffs unsuccessfully challenged the removal of “multi-family housing” under GMO 03-2012 through the Land Use Board of Appeals. See Cassidy v. City of Glendale, Or. Land Use Bd. of App. No. 2012-033 (Oct. 10, 2012), available at http://www.oregon.gov/luba/pages/2012opinions.aspx.

         Between May 11, 2012, and January 21, 2013, plaintiffs unsuccessfully sought a COO through Douglas County. On January 21, 2013, the City of Glendale issued plaintiffs a notice of building code civil penalty for violation of Oregon Structural Specialty Code (OSSC) § 111.1 Use and occupancy. On August 22, 2013, Cow Creek received an invoice stating the civil penalties balance amounted to $30, 000. By September 16, 2013, this balance had increased to $65, 000.

         Prior federal court litigation against City of Glendale

         This is the second federal lawsuit that plaintiffs Pacific Community Resource Center and Michael Cassidy have filed against the City of Glendale. The first lawsuit is styled: Pacific Community Resource Center, v. City of Glendale, Oregon, , Case No. 6:13-cv-1272-MC. The prior lawsuit, filed July 25, 2013, also named as defendants: Fred Jensen acting as Mayor; Betty Stanfil acting as City Manager; and the six individual City Council Members.

         In the prior federal lawsuit, the plaintiffs alleged violation of federal and state fair housing laws, and violations of plaintiffs' Fourteenth Amendment “substantive due process” rights and Fourteenth Amendment “equal protection” rights. The claims were based on the City of Glendale's alleged discriminatory obstruction of Pacific Community's efforts to obtain a conditional use permit, selective enforcement of certificate of occupancy requirements, and the City's adoption of ordinance GMO 03-2012. Opinion and Order 2-5; ECF No. 108, 6:13-cv-1272-MC. Because of the gravity of the factual allegations against the city regarding discriminatory intent, the court provided pro bono counsel for plaintiffs. Those factual allegations were not born out at trial.

         On February 5, 2015, at a hearing on defendants' motion for summary judgment, the plaintiffs withdrew their due process claim. Subsequently, there was a five-day jury trial where judgment was entered in favor of all defendants on the remaining claims. Judgment on the jury verdict was entered on March 23, 2015. Plaintiffs appealed the jury verdict to the 9th Circuit Court of Appeals where the appeal is pending as of the time of this Opinion and Order.

         City of Glendale sues to foreclose in state court

         After the conclusion of the federal trial, on April 9, 2015, the City of Glendale brought an action in Douglas County Circuit Court, State of Oregon, to foreclose on a lien. City of Glendale v. Cow Creek Properties, LLC, , 15-CV-08731. City's MSJ 3-4; ECF No 19. In that action, plaintiff Michael Cassidy (who was not a party to that state action) filed 12 motions, to include a Motion to Intervene, all of which were denied by the Douglas County Circuit Court. City's MSJ, Ex. 7; ECF No. 19. Plaintiffs Cassidy, Schlauch, and “All Other Occupants” appealed to the Oregon Court of Appeals, citing in part a ...


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