Opinion
No. 850 C.D. 2011
04-23-2012
White House Café, Inc., Appellant v. Pennsylvania Liquor Control Board
BEFORE: HONORABLE DAN PELLEGRINI, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE MARY HANNAH LEAVITT, Judge
This case was assigned to the opinion writer before January 7, 2012, when Judge Pellegrini became President Judge.
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE SIMPSON
This appeal involves an application for renewal of a liquor license. The Pennsylvania Liquor Control Board (PLCB) refused White House Café's application for renewal under the Liquor Code, based on criminal incidents involving assaults with weapons resulting in serious injury and death in or around the licensed premises. White House Café (Licensee) appealed the PLCB's non-renewal to the Court of Common Pleas of Luzerne County (trial court), which denied Licensee's appeal. We affirm the trial court.
Act of April 12, 1951, P.L. 90, as amended, 47 P.S. §§1-101-8-803.
Senior Judge Jerome P. Cheslock of the Monroe County Court of Common Pleas sat by designation.
Background
Licensee submitted an application to renew its liquor license No. R-5255 (License) for operation of a restaurant at 198 Hazle Street, Wilkes-Barre (Premises) for the two-year period effective September 1, 2006, and ending August 31, 2008. The Premises is located in a high-crime area referred to by police as the "Iron Triangle." Notes of Testimony (N.T.), 7/27/07 at 50; Bd. Finding of Fact (F.F.) No. 23. Shootings occur in the area even when the Premises are closed. Licensee has a capacity for approximately 150 patrons and 20 outdoor parking spaces.
Licensee is a family-owned business operating at this location for over 70 years. The current owners, Lisa and Lou Ruzzi (Owners), took over from Ms. Ruzzi's grandmother when she became ill after an arson attempt at the Premises in October 2004. They officially took over the License when her grandmother died shortly thereafter. Ms. Ruzzi is a school guidance counselor, and her father is a judge for Luzerne County.
Upon receiving the renewal application, the PLCB's Bureau of Licensing (Licensing Bureau) notified Licensee of its objections by letter, indicating a hearing would be conducted. The Licensing Bureau alleged that Licensee abused its licensing privilege based upon one adjudicated citation and two incidents "of disturbance," including "shootings at or near the Premises." See Licensing Bureau Notice of Objections, 8/21/06.
Licensee received Citation No. 06-0189 for violation of the PLCB's regulations in selling an indefinite amount of alcohol at a fixed price. The citation stated that on November 3 and 17, 2005, during a "Ladies Night" special, Licensee sold unlimited draft beers and mixed drinks for the fixed price of $10.00. Licensee admitted the violation and paid a $250.00 fine.
Licensee received another citation, Citation No. 06-2759, adjudicated since the date of the hearing, for sales to a minor. The PLCB did not consider this citation because it was unadjudicated at the time of the PLCB's decision. Bd. Op. at 37.
The two incidents of criminal activity were assaults with weapons resulting in serious injury and death in or around the Premises. The first assault occurred on March 9, 2005 (2005 Assault). The 2005 Assault involved two masked-men entering the Premises with weapons, opening fire, and leaving. Victims were found by police inside and outside the Premises. The second assault occurred less than 11 months later, on January 30, 2006 (2006 Homicide), involving a shooting outside the Premises in which one of the victims died.
After formal notice of the PLCB's initial objections, and while proceedings were pending, an on-Premises brawl and third assault resulting in serious injury and death occurred on July 17, 2007 (2007 Homicide). The PLCB amended its objection letter to include the new Homicide, and sent it certified mail to Licensee. The amended objection letter, dated July 17, 2007, notified Licensee of a hearing date on July 27, 2007.
The certified mail was returned unclaimed, and Licensee challenged proper notice of the 2007 Homicide. Licensee also objected to testimony regarding the 2007 Homicide.
A hearing examiner conducted hearings on July 27, 2007, and September 24, 2007, at which the parties presented testimony regarding all three assaults.
Summary of Relevant Testimony
Sergeant Matthew Stash, a veteran with 13 years of police experience in the area, testified regarding the 2005 Assault. He testified that it is not common for bars in the Wilkes-Barre area to have video surveillance and noted that the video Licensee offered was a key piece of evidence to the police investigation. Sergeant Stash testified the shooting was not predictable and that he was not aware that it related to Licensee's operation.
Officer John Majikes, a veteran with eight years of experience, responded to the call about the shooting in the 2006 Homicide. Specifically, he testified as to the call he received from dispatch on January 30, 2006: "reports of shots fired at the café, persons injured." N.T., 7/27/07, at 57. Officer Majikes admitted he did not respond directly to the Premises and did not visit the Premises that night. Rather, he traveled to several other area bars looking for a certain vehicle and suspect. Officer Majikes did not know where the victim was shot and could not comment on how the bar operated.
Detective George Hudock, a veteran with 24 years of experience, testified regarding the 2007 Homicide. He testified that the three victims, (two shooting and one stabbing) were not at the scene by the time he arrived. One shooting victim died. He noted the largest pool of blood was across the two-lane street from the Premises, about 20 feet east, where police found the knife. In total, from the door of the Premises, the closest pool of blood was across the street and sidewalk about 60 to 70 feet away, and that "it could be [as far as] 80" feet away. N.T., 9/24/07, at 25. Detective Hudock described the street as two-lanes, permitting two-way vehicular travel with parallel parking along both sides. The crime scene did not include inside the Premises.
Detective Hudock testified Licensee cooperated with his investigation and provided him video surveillance showing both inside and outside the Premises. He testified the video showed that a large fight broke out inside the Premises, with punching, shoving and breaking of glass bottles and at least one chair thrown. From viewing the video, Detective Hudock was able to determine that the victims were involved in the fracas inside the Premises. He testified he also picked out the later-identified suspect inside the Premises during the fight.
Detective Hudock testified it is not "normal" for area bars to have surveillance cameras like Licensee does. N.T., 9/24/07, at 21. He also testified that most bars do not have metal detectors, which are used for prevention. He testified that Licensee and its employees did not do anything to precipitate the fight inside the Premises, and he agreed the bouncers took immediate and appropriate action once the fight began.
Owner Ms. Ruzzi testified about the security measures Licensee undertook and the criminal activity in the area. At the time of the 2005 Assault, Licensee had "24-7" real-time video camera surveillance operating throughout the Premises which Owners accessed via website. Owners, who live in Philadelphia, personally monitor the Premises on weekends.
After the 2005 Assault, Licensee employed a full-time doorperson, installed a buzzer at the side door, installed new doors, instituted a policy permitting only one person in the bathroom at a time, added outdoor lighting and instructed employees to call the police "no matter what." N.T., 9/24/07, at 54. Ms. Ruzzi also requested police presence, which was unavailable. Ms. Ruzzi testified that after the 2005 Assault, she learned more about the crime in the area and saw that her mailman had to wear a bullet-proof vest.
With regard to the 2006 Homicide, Ms. Ruzzi testified that the shooting occurred after patrons exited the Premises. Specifically, she testified:
[t]here was no evidence of a fight whatsoever taking place. Cameras showed—because the detectives looked at the cameras. Cameras showed people walking outside, no scuffle, no argument, nothing inside the bar, and then the incident taking place outside the bar. I just want to make that clear, because I didn't think it was very clear when the officers were testifying before.N.T., 9/24/07, at 55 (emphasis added). Ms. Ruzzi noted if someone caused any trouble inside the Premises, employees removed him or her. Significant for our analysis, she explained that sometimes employees would remove one or both individuals, sometimes the police were called, and sometimes employees kept individuals inside until the police arrived. She testified Owners have a zero-tolerance policy for any illegal activity ("no drugs, no knives, no guns, call the police, cooperate with the police, no underagers") and advised their security expert of this policy. N.T., 9/24/07, at 61.
After the 2006 Homicide, Owners added two cameras outside, installed metal detectors, increased outdoor lighting, changed the type of music played and hired another person to patrol the parking lot. Ms. Ruzzi also offered the police department complete 24-hour access to the Premises and the surveillance system for police work. Owners also hired Victor Vega as a security expert.
Vega, hired in July or August 2006 for security, also is a manager. Vega is certified by the State of New York in security, and in New York clubs he managed security teams from three to 32 people. He is Act 235 certified to carry a firearm and has training and certification in use of batons, handcuff methods of restraint and self-defense. Vega worked the door searching patrons and got to know the clientele. Vega kept a list of banned patrons in his head, and with the addition of more security personnel, he created a written list. Security personnel viewed the tapes to match a face with a name on the banned list. Two security personnel escort banned patrons from the Premises. Vega monitored the Premises via the website even when he was not on-site and alerted personnel to anyone on the banned list. He reported few attempted re-entries since enforcing the banned list.
Act of October 10, 1974, P.L. 705, as amended, 22 P.S. §§41-50, known as the "Lethal Weapons Training Act."
On Vega's recommendation, Owners hired additional security staff. On busier nights, like Fridays and Saturdays, Licensee had five or six security personnel and on less busy nights, had at least two security personnel. Security personnel wore t-shirts with the word "Security" on both front and back. The person working the front door was armed with a weapon, whereas another person working the door used the metal detector wand. The armed-person verified identification while the other person physically searched patrons. Vega hired a female bouncer to search female patrons. When she was not available, they used a metal detector wand. Vega also instituted a dress code to discourage criminal activity: "baseball caps only, no jeans, no sneakers, no [gang] colors." N.T., 9/24/07, at 113. On July 13, 2007, four days before the 2007 Homicide, Owners learned they could hire off-duty police officers. However, they would need to hire at least four officers for at least four hours per shift for $35 an hour. F.F. No. 130.
Vega was on-duty and armed during the 2007 Homicide, along with the armed door person. He believed Licensee could not have prevented the fight.
The hearing examiner issued a recommendation to renew the License. The PLCB disagreed, and it declined to renew the license.
PLCB Opinion
The PLCB issued its opinion after Licensee appealed non-renewal. The PLCB concluded Licensee accrued one adjudicated citation and experienced three incidents of criminal activity in a two and a half-year period. The PLCB determined Licensee knew or should have known of the pattern of criminal activity, and it failed to take substantial, successful affirmative measures to prevent continuous criminal activity on or near the Premises since February 2005.
The PLCB noted that had it been only for the single adjudicated citation, it would have been inclined to renew the License. However, it was concerned about the three armed assaults since February 2005. Bd. Op. at 37.
With regard to the 2005 Assault, the PLCB found no relationship between the criminal activity and Licensee. The PLCB stated, "The Board is hard-pressed to hold Licensee responsible for the first shooting incident, which was the result of masked men running into the bar, opening fire and leaving." Bd. Op. at 41.
As to the 2006 Homicide, however, the PLCB found a relationship between a fight inside the Premises and the altercation outside that resulted in a fatal shooting. Bd. Op. at 38, 42.
With regard to the 2007 Homicide, the PLCB stated, "It is not clear where the persons involved in the third incident had their weapons on them while they were in the premises. Perhaps better use could have been made of the metal detection devices. Perhaps Licensee's new owners should have been physically present during the week." Bd. Op. at 42. Nevertheless, the fighting patrons were escorted out of the bar by employees, and three to five minutes later the shootings and stabbing occurred. Id. The PLCB reasoned, "Licensee cannot put its problems out on the street and then wash its hands of those problems." Id. at 43.
The PLCB acknowledged Licensee called the police regarding the Assault and Homicides, cooperates with police and "has taken a multitude of steps to prevent criminal activity inside the premises, and seems sincere in its efforts to avoid all criminal activity at the bar." Bd. Op. at 42. However, the PLCB noted Licensee attracts the types of patrons who solve their disputes with violence. The PLCB found that, given the violence inside and outside the Premises, steps Licensee took to curb such activity were not substantial or successful enough to renew the License.
Appeal to Trial Court
The parties submitted the matter to the trial court based on the administrative record; the trial court took no additional evidence. Based upon the evidence submitted to the PLCB and numerous proposed findings of fact, the trial court found it undisputed that "numerous acts of violence took place both inside and directly outside of the licensed premises, which included multiple stabbings and two deaths." Tr. Ct., Slip Op. at 1. The trial court noted that the Premises are located in a very high-crime area, and that "[t]he area involved, coupled with the consumption of alcohol, produced an extremely dangerous environment." Id. at 2. The trial court found the steps taken by Licensee "were not substantial or successful enough for the liquor license to be renewed." Id. The trial court affirmed the PLCB, concluding "[i]t is this Court's opinion that no licensed establishment can operate at that location in a safe manner." Id.
A trial court reviewing a decision of the PLCB not to renew a liquor license hears the matter de novo, and may sustain, alter, modify, or amend the PLCB's order even when it is based upon the same evidence presented before the PLCB. First Ward Republican Club of Phila. v. Pennsylvania Liquor Control Bd., 11 A.3d 38 (Pa. Cmwlth. 2010).
Licensee appealed the non-renewal of its License to this Court.
Our review in a liquor license renewal case is limited to a determination of whether the trial court's findings of fact are supported by substantial evidence, whether it abused its discretion, or whether it committed an error of law. In re License Renewal Application of the Quippan Club, 806 A.2d 491 (Pa. Cmwlth. 2002).
Discussion
Under the Liquor Code, renewal of a liquor license is not automatic. Section 470 of the Liquor Code, 47 P.S. §4-470, provides the PLCB may, in its discretion, refuse to renew a liquor license for many reasons. Section 470(a.1) of the Liquor Code, provides in pertinent part:
Added by the Act of December 21, 1998, P.L. 1202.
(a.1) The Director of the Bureau of Licensing may object to and the board may refuse a properly filed license application:47 P.S. §4-470(a.1)(emphasis added).
(2) if the licensee [or its agents, employees...] ha[s] one or more adjudicated citations under this or any other license issued by the board ...
(4) due to the manner in which this or another licensed premises was operated while the licensee, its shareholders, directors, officers, association members, servants, agents or employes were involved with that license. When considering the manner in which this or another licensed premises was being operated, the board may consider activity that occurred on or about the licensed premises or in areas under the licensee's control if the activity occurred when the premises was open for operation and if there was a relationship between the activity outside the premises and the manner in which the licensed premises was operated. The board may take into consideration whether any substantial steps were taken to address the activity occurring on or about the premises.
Licensees are held strictly liable for violations of the Liquor Code that occur on the licensed premises. Pennsylvania Liquor Control Bd. v. TLK, Inc., 518 Pa. 500, 544 A.2d 931 (1988). This Court upholds the PLCB's exercise of its discretion under Section 470 of the Liquor Code to find that even one past citation or violation is sufficient to support a decision refusing a renewal application. Hyland Enters., Inc., Pennsylvania Liquor Control Bd., 631 A.2d 789 (Pa. Cmwlth. 1983).
Here, there is no dispute that Licensee has an adjudicated citation. However, the PLCB candidly stated that had the citation been the only issue with Licensee's operation it would have renewed the License. Bd. Op. at 37. Thus, while the law permits the PLCB to refuse renewal based on a single citation, the PLCB clearly stated the citation did not form the basis for non-renewal. Further, the trial court did not address the citation in its opinion.
Denial of the renewal application is predicated upon three assaults with weapons that resulted in serious injury and death within a two-and-a-half year period. We focus our attention on the Assault and Homicides.
Licensee argues it should not be held liable for the criminal activity comprised of the 2005 Assault and 2006 and 2007 Homicides because Licensee did not cause the criminal activity and invested substantial funds and undertook substantial affirmative efforts to prevent criminal activity on or near the Premises. The trial court erred, Licensee asserts, in holding Licensee strictly liable for its unfortunate location in a high-crime area where shootings occur that are wholly unrelated to Licensee's operations or employees.
The PLCB argues that substantial evidence supports the trial court's conclusion that numerous acts of violence occurred, including the Assault and two Homicides. The PLCB asserts Licensee should have known about the criminal activity, and failed to take substantial steps to address it. Specifically with regard to the 2007 Homicide, the PLCB argues:
[A] decision was made to rush all parties out of the bar and leave them alone outside. There was apparently no attempt to keep the parties separated long enough for a cooling off period to occur. Other than pushing the parties out of the licensed premises, there was no evidence to suggest that any of the security guards on duty ... remained outside in order to maintain a safe disbursement of patrons onto [Licensee's] parking lot and the public sidewalk. Within minutes of the entire group being put out of the licensed premises, gunfire erupted immediately outside the premises.Appellee's Br. at 19, n.1. The PLCB also submits the trial court did not abuse its discretion in refusing to renew the license given the serious nature of the crimes and the lack of timely corrective measures.
1. Relationship between Criminal Activity and Operations
Licensee denies any relationship between the Assault and two Homicides and its operations. Consistent with the Liquor Code, a relationship between the criminal activities and operations must exist to warrant non-renewal. See 47 P.S. §4-470(a.1).
The 2005 Assault occurred inside the Premises. The PLCB did not find fault with Licensee and found no relationship between the criminal activity and Licensee's operations. Nevertheless, the 2005 Assault put Licensee on notice that the business attracted persons who resolve disputes with weapons, resulting in serious injury. The severity of the injuries to Licensee's patrons during the 2005 Assault justifies urgency and significant additional security measures.
After the 2005 Assault, Licensee made some security changes, and Ms. Ruzzi became more knowledgeable about crime in the area. The changes and increased knowledge, however, were not sufficient to deter future serious assaults from recurring. The 2006 Homicide occurred directly outside the Premises as patrons left the bar. In this regard, we reference Ms. Ruzzi's testimony that the security cameras showed patrons leaving the bar "and then the incident taking place outside the bar." N.T., 9/24/07, at 55. Given the use of a deadly weapon so soon after patrons left and so near as to be captured by security cameras, the record is sufficient to support a determination that a relationship existed between the 2006 Homicide and inadequate security for patrons coming and going.
After the 2006 Homicide, Licensee was on notice that the bar continued to attract patrons who solve their disputes with weapons, resulting in serious injury and death. Licensee was also on notice that its security failed to protect patrons as they left the bar.
Dispelling any ambiguity, the Licensing Bureau formally objected to license renewal in August 2006, specifically referencing the 2005 Assault and the 2006 Homicide. At this point, Licensee had actual knowledge of a challenge to the sufficiency of its security, and that the License may not be renewed.
Despite this foreknowledge, Licensee's efforts were still inadequate to prevent further bloodshed to patrons leaving the bar. With regard to the 2007 Homicide, the suspect and victims participated in a brawl inside the Premises. Then, the fight moved outside, and within three to five minutes escalated to shooting and stabbing, resulting in injury and a second death. Given the use of deadly weapons so soon after expulsion and so near to the bar, and given the inadequate efforts to separate the feuding patrons, there is sufficient evidence to support a determination that there was a relationship between the 2007 Homicide and Licensee's operation of the Premises. The failure to separate and monitor the fighters is all the more remarkable given Ms. Ruzzi's testimony that sometimes her employees kept individuals inside until police arrived. On this point we agree with the PLCB that Licensee cannot put its problems out on the street and then wash its hands of those problems.
The PLCB and trial court properly considered the 2007 Homicide, which occurred subsequent to the renewal date and initially scheduled hearings. See Quippan Club. We note Licensee received notice 10 days before the hearing as to the 2007 Homicide.
In sum, we conclude there is sufficient evidence to support a finding of a relationship between the two Homicides and Licensee's operations.
2. Scienter and Substantial Affirmative Measures
Licensee contends the trial court erred in holding that it did not undertake substantial and affirmative steps to prevent criminal activities in and around the Premises. Essentially, Licensee argues the trial court required Licensee to eradicate all criminal activity to avoid liability, evident by its statement that "no one" could safely operate an establishment at that location. Tr. Ct., Slip Op. at 2.
The PLCB asserts the trial court committed no error because the 2005 Assault put Licensee on notice of the criminal activities throughout the high-crime area in which the Premises is located. Further, the PLCB argues that Licensee's remedial measures are not sufficient or substantial. Specifically, the PLCB argues that hiring a security expert six months after the 2006 Homicide is not a timely remedial measure.
For non-Liquor Code related violations of law, including the Crimes Code, the PLCB may refuse to renew a license where the licensee "(1) knows or should have known of ongoing criminal activities; and (2) [] failed to take substantial affirmative steps to prevent such activities." TLK, 518 Pa. at 504, 544 A.2d at 933. As a two-pronged conjunctive standard, both elements must be present for a third-party crime to form the basis of non-renewal of a license. TLK; Rosing, Inc. v. Pennsylvania Liquor Control Bd., 690 A.2d 758 (Pa. Cmwlth. 1997) (holding a licensee need not do everything possible to prevent criminal activities, just to take substantial affirmative measures to prevent misconduct).
Regarding scienter, it is sufficient to look at Owners' admissions and the clearly substantiated facts here. There is no dispute that the Premises are located in a high-crime area. Further, Ms. Ruzzi admitted that her mailman wears a bullet-proof vest and that she learned of that in response to the 2005 Assault. Ms. Ruzzi also testified about the several steps undertaken to increase security in order to ensure additional shootings did not occur outside the Premises. Licensee's sensitivity to the high crime and prevalence of possible shootings is established. Thus, as explained more fully above, knowledge is properly imputed to Licensee.
As the PLCB established scienter, the burden shifts to Licensee to show it took steps to guard against a "known pattern of illegal activities" with "substantial and affirmative" efforts. TLK, 518 Pa. at 504-05, 544 A.2d at 933.
Licensee instituted a number of remedial measures based on Vega's recommendations in the summer of 2006: hiring additional security staff; using armed doormen; implementing a dress code and banned patron list; requiring a security uniform of t-shirts clearly marked "Security;" issuing and using a metal detector wand at the door; patrolling and monitoring outside, including the parking area; and, installing additional outdoor cameras and lighting. Licensee contends these measures were both substantial and affirmative given our decision in Rosing.
In Rosing, the PLCB refused renewal because over a two-year period, police made several arrests for criminal activity at or adjacent to the licensed premises. The trial court in Rosing reversed the PLCB, finding the criminal activity at the premises was due to location in a high-crime area rather than fault of the owners or their operations. The Rosing trial court held the owners took substantial steps to prevent criminal activity and cooperate with the police based upon efforts that largely mirror those undertaken by Licensee here. Licensee contends the trial court's opinion directly conflicts with this Court's holding in Rosing that a licensee cannot be held responsible for stopping all unlawful activity.
We do not agree that the trial court here required Licensee to stop all unlawful activity. This case is not about disorderly conduct, loitering, harassment, criminal mischief, theft or even simple assault. Rather, the trial court understood that some of the most catastrophic criminal acts were at issue, shootings and stabbings, and it properly addressed those.
Licensees are required to take substantial affirmative measures to discourage violence resulting in serious injury and death to their patrons. As discussed at length above, Licensee's efforts repeatedly failed to protect their exiting patrons. Clearly, additional outdoor cameras and lighting were not substantial in relation to the gravity of the risk involved. Indeed, these steps did not deter the 2006 and 2007 Homicides. Also, while Owners claimed to have increased outdoor patrolling and monitoring, the trial court was not compelled to find these steps substantial in lieu of evidence that they were utilized during the 2006 and 2007 Homicides. In fact, it appears that these steps were not utilized when needed most, after the on-Premises brawl preceding the 2007 Homicide. Accordingly, we conclude the trial court committed no error in finding Licensee's efforts did not qualify as "substantial."
Further, whether measures are deemed "substantial and affirmative" depends in part on when the measures are instituted. Remedial measures must be taken at a time when the licensee knows or should know that illicit activity is occurring on its premises. I.B.P.O.E. of West Mount Vernon Lodge 151 v. Pennsylvania Liquor Control Bd., 969 A.2d 642 (Pa. Cmwlth. 2009) (finding remedial measures, to include a metal detector, shirts with security written on them, and additional security, taken only a couple weeks before the hearing before the trial court are too late). Thus, timeliness is calculated from the time the licensee "should have known of the illegal activity." Pennsylvania Liquor Control Bd. v. Can, Inc., 651 A.2d 1160, 1166 (Pa. Cmwlth. 1994) (emphasis in original).
The record evidence substantiates that Licensee knew that shootings occurred on the Premises as of the 2005 Assault. Therefore, we calculate the timeliness of Licensee's remedial measures from the date of the 2005 Assault.
Based on the undisputed facts, Licensee did not hire Vega as its security expert until July or August of 2006, over 16 months after the 2005 Assault and over six months after the 2006 Homicide. This timeline is inadequate given the severity of the 2005 Assault and related injuries, and it is obviously inadequate to address the 2006 Homicide.
In short, given the magnitude of the risk, the repetition of death and serious bodily injury, and the inadequacy of remedial measures, the record supports a determination that the efforts were not substantial enough to deter further bloodshed.
Concluding the trial court's opinion is in accordance with applicable law and supported by substantial evidence, we affirm.
/s/_________
ROBERT SIMPSON, Judge ORDER
AND NOW, this 23rd day of April, 2012, the order of the Court of Common Pleas of Luzerne County is AFFIRMED.
/s/_________
ROBERT SIMPSON, Judge BEFORE: HONORABLE DAN PELLEGRINI, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE MARY HANNAH LEAVITT, Judge
This case was assigned to the opinion writer prior to January 7, 2012, when Judge Pellegrini became President Judge.
OPINION NOT REPORTED
DISSENTING OPINION BY JUDGE LEAVITT
In affirming the Liquor Control Board's non-renewal of White House Café's liquor license under the Liquor Code, the trial court held that the café's crime prevention measures were not "substantial or successful enough" to prevent crimes from taking place outside the café and that "no licensed establishment can operate at that location in a safe manner." Trial Court Opinion at 2. This is not the statutory standard. Licensees cannot, and are not expected to, institute measures to prevent crime in their neighborhoods. For this reason, I must respectfully dissent from the majority's decision to affirm the trial court.
Act of April 12, 1951, P.L. 90, as amended, 47 P.S. §§1-101 - 10-1001.
Section 464 of the Liquor Code provides, in relevant part:
The court shall hear the application de novo on questions of fact, administrative discretion and such other matters as are involved, at such time as it shall fix, of which notice shall be given to the board. The court shall either sustain or over-rule the action of the board and either order or deny the issuance of a new license or the renewal or transfer of the license ... to the applicant.47 P.S. §4-464. Our Supreme Court has held that this de novo review permits the trial court to "sustain, alter, change, modify or amend the board's action whether or not it makes findings which are materially different from those found by the board." Pennsylvania State Police, Bureau of Liquor Control Enforcement v. Cantina Gloria's Lounge, Inc., 536 Pa. 254, 265, 639 A.2d 14, 19-20 (1994). The trial court's opinion is less than two pages long. Although not express, it appears to adopt the Board's findings of fact and conclusions of law, applying a deferential standard of review.
The Board may refuse to issue a license or renew an existing license where the licensee, its officers, employees or agents "have violated any of the laws of this Commonwealth or any of the regulations of the board ...." Section 470(a.1)(1) of the Liquor Code, 47 P.S. §4-470(a.1)(1). It may also non-renew a license "due to the manner in which this or another licensed premises was operated ...." Section 470(a.1)(4) of the Liquor Code, 47 P.S. §4-470(a.1)(4). In implementing this standard, the Board may consider
activity that occurred on or about the licensed premises or in areas under the licensee's control if the activity occurred when the premises was open for operation and if there was a relationship between the activity outside the premises and the manner in which the licensed premises was operated. The board may take into consideration whether any substantial steps were taken to address the activity occurring on or about the premises.Id. To non-renew a license for activities that take place outside the licensed premises, there must be a relationship between those activities and "the manner in which the licensed premises was operated." Id. In its non-renewal decision, the Board considered three incidents that took place "on or about" the White House Café.
The first crime took place in 2005 when masked gunmen entered the café, shot at patrons, and left. Police testified that thanks to the cooperation of the café and its employees as well as the café's security videotapes, the gunmen were arrested and convicted. The Board did not find the incident relevant to its non-renewal decision, except to note that this crime put the café on notice that the neighborhood was dangerous.
The second crime took place in 2006, when a patron, who had just left the café, was fatally shot across the street. In its opinion, the Board stated that "[w]itnesses stated (and videotape verified) that the deceased victim and the shooter were arguing inside the bar, went or were escorted outside, and then the shootings occurred." Board Decision at 38. The record does not support this finding. No witness testified about a confrontation inside the bar or that anyone escorted the two patrons outside. To the contrary, Lisa Ruzzi, owner of the café, testified that:
There was no evidence of a fight whatsoever taking place. Cameras showed-because the detectives looked at the cameras. Cameras showed people walking outside, no scuffle, no argument, nothing inside the bar, and then the incident taking place outside the bar. I just want to make that clear because I didn't think it was very clear when the officers were testifying before.Notes of Testimony, 9/24/07, at 55-56 (emphasis added). Notably, in its brief filed with this Court, the Board does not claim that the shooting related to an argument that started in the café.
The third crime took place in 2007. A fight began between two patrons inside the café, and the bartender responded by immediately calling 9-1-1. As the bouncers attempted to break up the fight, other patrons became involved, using beer bottles as weapons and punching and shoving one another. Bouncers removed one group of patrons and kept others inside, in an effort to quell the disturbance. George Hudock, a police detective with 24 years of experience, testified that the bouncers took appropriate steps to control the situation. Approximately five minutes after the last patron left the café, shots were fired outside resulting in a homicide. A second victim was stabbed some 60-70 feet away from the café. The café made a second call to 9-1-1. Surveillance video did not record any weapons inside the café, and there was time for the criminal to retrieve a weapon from a car or from another location.
Random acts of violence occurred at or near the café. However, any liquor establishment may be visited by a violent, criminally-inclined patron. This is a universal risk. For criminal activity to justify a license non-renewal, there must be a connection between that activity and the manner of the licensed establishment's operation. Here, the Board did not make the express finding that the manner in which the café was operated bore a causal relationship to crimes committed outside. More importantly, the record shows that the café took "substantial steps to address the activity" at issue, which the Board dismissed because they were not successful.
Precedent on Section 470(a.1)(4) non-renewals relates almost entirely to drug offenses. In Pennsylvania State Police, Bureau of Liquor Control Enforcement v. Can, Inc., 651 A.2d 1160 (Pa. Cmwlth. 1994), for example, drug dealing and use was evidenced by patrons' repeated short trips to the bathroom, repeated trips in and out of the establishment and drug-related conversation in the presence of employees. The owners permitted the establishment to be used as a safe harbor and, thereby, abused their licensing privilege. Their license was non-renewed for "abetting or engaging in drug-related activities both on and contiguous to the licensed premises." Can, Inc., 651 A.2d at 1162. Likewise, in Pennsylvania Liquor Control Board v. TLK, Inc., 518 Pa. 500, 544 A.2d 931 (1988), the Supreme Court upheld a license non-renewal for drug trafficking. It reasoned:
Due to the pervasive nature of this illicit activity, it may be said that the licensee should have known of the misconduct of his employee. That being the case, he is deemed to have permitted or acquiesced in the misconduct unless he proved that he took substantial affirmative measures to prevent it.Id. at 506, 544 A.2d at 934 (emphasis added).
Here, there was nothing "pervasive" about the three crimes that took place at or near the café. They were three unrelated and isolated events that did not involve employee participation. The crimes cannot be causally connected to the manner in which the café was operated, and there is zero evidence of the owners' acquiescence in these crimes. To the contrary, the owners took "substantial affirmative measures" to prevent such crimes in the future.
In I.B.P.O.E of West Mount Vernon Lodge 151 v. Pennsylvania Liquor Control Board, 969 A.2d 642 (Pa. Cmwlth. 2009), we questioned whether "three serious incidents" consisting of assaults, a shooting, and a gun brought into the bar over an 18-month time span constituted a "pattern of illicit activity." Id. at 650 n.9. The licensee did not assert that three serious incidents were not attributable to the manner in which the premises operated. Here, the licensee does challenge that point.
In determining whether a licensee has taken substantial affirmative measures to prevent illicit activity, our precedent is clear. A liquor licensee is "not required to do everything possible to prevent criminal activity on the premises, act as their own police force, or close their business." Rosing, Inc. v. Pennsylvania Liquor Control Board, 690 A.2d 758, 762-63 (Pa. Cmwlth. 1997), overruled on other grounds by Pennsylvania Liquor Control Board v. Richard E. Craft American Legion Home Corp., 553 Pa. 99, 103, 718 A.2d 276, 278 (1998). In Rosing, the Board non-renewed a liquor license after finding that the licensee did not take substantial steps to prevent criminal activity that had taken place at or near the licensed premises. The trial court reversed the Board because the criminal activity in question related to the licensee's location in a high-crime area, not to the actions of the licensee. The Board appealed, and we affirmed the trial court.
We applied a two-part analysis. First, we held that the licensee must be on notice of criminal activity. Second, once on notice, the licensee must take steps to address that criminal activity. The licensee in Rosing was on notice of the criminal activities, so we looked to see if it had taken substantial affirmative measures in response. In holding that the licensee had taken substantial affirmative measures, we explained that:
Owners here took substantial affirmative measures because they made a zealous effort and incurred a financial burden to prevent drug-related activities on the premises while maintaining a reasonable zone of safety for themselves and their personnel.Rosing, 690 A.2d at 762 (emphasis added). We did not require that the measures be successful.
White House Café took numerous substantial affirmative steps to prevent criminal activity at a cost in excess of $100,000. It hired a full-time, armed doorman; requested police presence; installed a buzzer on the side door; installed new security doors; established a one-person bathroom policy; increased the outdoor lighting; established a "call police no matter what" policy; installed 24/7 indoor/outdoor online-linked security cameras; installed metal detectors; hired bouncers, of both gender, to do pat-downs; instituted parking lot patrols; hired additional security personnel; and kept a "banned-persons" list. Several police officers testified that the café's cooperation and video surveillance directly contributed to the arrest and successful prosecution of the perpetrators of each of the three incidents. The café took many of these measures on the advice, for which it paid dearly, of an experienced and certified security expert.
By stating that no establishment can safely operate at the café's location, the trial court expressed the belief that no substantial measures by the café would suffice. This effectively holds the café strictly liable for non-Liquor Code violations perpetrated by third parties. However, in TLK, Inc., our Supreme Court cautioned against a strict liability standard, stating:
We decline, however, to apply the rigid standard of strict liability when the subject conduct does not violate the liquor laws, but instead involves conduct prohibited by the Crimes Code, the Controlled Substance, Drug, Device and Cosmetic Act, or other penal legislation. In the latter cases, some element of scienter on the part of the licensee is required to endanger the liquor license.TLK, Inc., 518 Pa. at 504, 544 A.2d at 933 (emphasis added). No element of scienter on the part of the owners of the café was alleged or shown.
The majority is critical of the measures taken by the café. It claims that outdoor cameras and lighting were not substantial steps, given the gravity of the crimes, and that the measures taken must not have been "substantial" because they were in place during the 2006 and 2007 incidents. Finally, it notes that the café did not hire their security expert until July or August of 2006, 16 months after the 2005 incident. Whether the steps were substantial cannot be judged by their success in reducing the "activity about the licensed premises."
The licensee took a sequence of affirmative measures in response to each incident. After the 2005 incident, the café installed a buzzer and a security door, hired a doorman and requested a police presence. After the 2006 incident, the café installed more outdoor lighting, added outdoor cameras and metal detectors, and instituted parking lot patrols. Six months later, it hired a security expert, who instituted numerous other security measures. Each measure was reasonable and proportional to the perceived threat, and it is not clear what else could have been done.
The Board suggested that the owners should be on site during the week and use metal detectors more effectively. There is no requirement that owners be present during operating hours and, contrary to the Board's supposition, it appears that the metal detectors were being used effectively inasmuch as no weapons entered the premises after the 2005 incident. --------
Section 611 of the Liquor Code, 47 P.S. §6-611, permits, inter alia, the local district attorney to close a liquor establishment where it presents a public nuisance. See, e.g., City of Allentown v. Down Low Nightclub, 993 A.2d 331 (Pa. Cmwlth. 2010); Commonwealth v. Sal-Mar Amusements, Inc., 630 A.2d 1269 (Pa. Super. 1993). If the Board felt that the café was a nuisance to the safety, health, and welfare of this neighborhood, it should have referred the matter to the district attorney. However, a perceived nuisance is not a basis for a license non-renewal by the Board, and the record before the Board did not address nuisance but, rather, the specific standard in Section 470(a.1)(4) of the Liquor Code.
The Board's evidence did not prove a "relationship between the activity outside the premises and the manner in which the [White House Café] was operated." 47 P.S. §4-470 (a.1)(4). Accordingly, I would reverse the trial court.
/s/_________
MARY HANNAH LEAVITT, Judge