Spinelli v. City of New York, No. 07-1237 (2d Cir. 2009)

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07-1237-cv Spinelli v. City of New York 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term 2008 (Argued: January 22, 2009 Decided: August 7, 2009) Docket No. 07-1237-cv ----------------------------------------------------x ANGELA SPINELLI and OLINVILLE ARMS, INC., Plaintiffs-Appellants, -- v. -CITY OF NEW YORK and PASQUALE CARABELLA, New York City Police Sergeant, Defendants-Appellees. -----------------------------------------------------x B e f o r e : 24 WALKER and CALABRESI, Circuit Judges.* Appeal by Plaintiffs from a judgment entered in the United 25 States District Court for the Southern District of New York 26 (Richard C. Casey, Judge), granting Defendants motion for 27 summary judgment and dismissing Plaintiffs due process, Fourth 28 Amendment, and tortious interference with business relations 29 claims. 30 Plaintiffs Fourth Amendment claim. 31 dismissal of the due process claim is REVERSED, and the case is 1 2 3 4 5 On appeal, we AFFIRM the district court s dismissal of * The district court s The Honorable Sonia Sotomayor, originally a member of the panel, was elevated to the Supreme Court on August 6, 2009. The two remaining members of the panel, who are in agreement, have determined the matter. See 28 U.S.C. § 46(d); Local Rule 0.14(2); United States v. Desimone, 140 F.3d 457 (2d Cir. 1998). -1- 1 REMANDED for the district court to enter summary judgment in 2 favor of Plaintiffs and to calculate damages on that claim. 3 dismissal of the tortious interference claim is VACATED and 4 REMANDED for further consideration. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 The SANFORD F. YOUNG, Law Offices of Sanford F. Young, (Laura Colatrella, on the brief), New York, N.Y., and David Zelman, Law Offices of David A. Zelman, Brooklyn, N.Y., for Plaintiffs-Appellants. ANN E. SCHERZER, Assistant Corporation Counsel, (Kristin M. Helmers, Mark Muschenheim, Of Counsel), for Michael A. Cardozo, Corporation Counsel of the City of New York, New York, N.Y., for DefendantsAppellees. JOHN M. WALKER, JR., Circuit Judge: Plaintiffs-Appellants Angela Spinelli and Olinville Arms, 23 Inc. (collectively Spinelli ) appeal from a judgment of the 24 district court (Richard C. Casey, Judge), granting summary 25 judgment to Defendants-Appellees City of New York and New York 26 City Police Sergeant Pasquale Carabella (collectively the City ) 27 dismissing Plaintiffs Fourth Amendment, due process, and 28 tortious interference with business relations claims that were 29 based on the City s confiscation of Spinelli s firearms inventory 30 and suspension of her dealer s license. 31 argues that the existence of material issues of fact on the 32 Fourth Amendment and due process claims preclude summary -2- On appeal, Spinelli 1 judgment, and that the district court should have exercised 2 supplemental jurisdiction over her state-law tortious 3 interference claim. 4 We conclude that the district court properly dismissed 5 Spinelli s Fourth Amendment claim because the City s warrantless 6 search of Olinville Arms was objectively reasonable and performed 7 pursuant to established regulations. 8 due process by denying Spinelli constitutionally sufficient 9 notice and the opportunity for a post-deprivation hearing. However, the City violated 10 Therefore, we reverse the grant of summary judgment in favor of 11 the City on the due process claim, and remand to the district 12 court to enter summary judgment in favor of Spinelli and 13 determine damages on that claim. 14 consideration of Plaintiffs tortious interference claim. 15 16 We also remand for further BACKGROUND Olinville Arms, Inc. ( Olinville ) is a gun shop, shooting 17 range, and travel agency located in Bronx County, New York, owned 18 and operated by Angela Spinelli. 19 by the New York City Police Department ( NYPD ) License Division 20 (the License Division or the Division ). 21 conditioned upon compliance with regulations under Title 38 of 22 the Rules of the City of New York ( Rules ) that require gun 23 dealers to adhere to certain security restrictions and provide 24 that the licensee s premises and firearms[] shall be subject to Olinville s license was issued -3- The license is 1 inspection at all times by members of the Police Department. 2 See 38 RCNY § 4-06(a)(3). 3 the Rules, the Division may suspend or revoke the dealer s 4 license for good cause by the issuance of a Notice of 5 Determination Letter to the licensee, which shall state in brief 6 the grounds for the suspension or revocation and notify the 7 licensee of the opportunity for a hearing. 8 9 If a gun dealer fails to comply with 38 RCNY § 4-04(l). In the wake of the September 11, 2001 terrorist attacks, the 47th Precinct of the NYPD was tasked with providing enhanced 10 security to sensitive locations within its boundaries, known as 11 Omega posts or Omega watches. 12 extended through October 2001, and Olinville was an Omega post. 13 The Omega post program On October 8, 2001, Captain Charles McSherry, an officer 14 from the 47th Precinct, entered Olinville under the Omega post 15 program without a warrant or Spinelli s permission and searched 16 the premises. 17 be grossly inadequate. 18 counter area, a large hole in Olinville s backyard fence, and two 19 unlocked safes. The search revealed the security at Olinville to Security issues included an unwatched 20 On October 9, 2001, the License Division advised Spinelli by 21 letter that, as a result of failure to provide adequate security 22 for [Olinville], her dealer s license was suspended. 23 directed Spinelli to surrender all firearms pending the 24 conclusion of the [License Division s] investigation, which -4- The letter 1 would determine whether Olinville s license would be continued, 2 suspended, or revoked. 3 Michael Kaplon was assigned to her case and provided Kaplon s 4 contact number, but did not notify Spinelli of the opportunity 5 for a hearing, as required by the Rules. 6 Officers from the 47th Precinct seized approximately 300 weapons 7 from Olinville, many of which, according to Spinelli, had already 8 been sold to customers who later demanded a refund. The letter told Spinelli that Sergeant See 38 RCNY § 1-04(f). 9 Spinelli hired attorney John Chambers, who had experience in 10 gun licensing matters, to help retrieve her license and firearms. 11 According to Chief Inspector Benjamin Petrofsky of the License 12 Division, [a dealer s] license [is] . . . normally suspended for 13 the duration of the investigation. 14 requesting a formal hearing, which Chambers believed could take 15 months to years to decide, Chambers contacted members of the 16 License Division on an informal basis through negotiations and 17 conversations that included letters to the Division requesting 18 the immediate return of Spinelli s property.1 19 imminently prepared to file a lawsuit against the Police 1 2 3 4 5 6 7 8 1 That s the norm. Instead of Chambers also was In one letter to the Division, Chambers alleges that Sergeant Pasquale Carabella, a police officer in the 47th Precinct and an individual defendant named in the underlying action, plan[ned] to go into business selling firearms in the Bronx, and therefore, directed the suspension of Olinville s permit to put his competition out of business. This allegation, based on Chambers good and reliable authority, is not supported by any other evidence in the record. -5- 1 2 Department to retrieve Spinelli s property. After retaining Chambers, Spinelli received a second letter 3 from the License Division, dated October 19, 2001, that suspended 4 Olinville s shooting range license pending investigation of the 5 October 8 incident report. 6 License Division, and argued that there were no sufficient stay 7 or security issues that [he] saw, vis-Ã -vis [the] gun range. 8 One day later, the shooting range license was reinstated. Chambers promptly met with the 9 On November 7, 2001, Sergeant Kaplon re-inspected Olinville, 10 but found that there was nothing done to repair the deficiencies 11 with the lack of security within the store. 12 Kaplon, Olinville exhibited total disregard for the rules and 13 regulations of maintaining a Gun Dealer License. 14 day, Chambers sent a letter to the License Division, informing 15 the Division of planned security improvements at Olinville. 16 These improvements were tailored to remedy McSherry s specific 17 complaints, and they included assurances by Spinelli that she 18 would restore the fences in the backyard area, install video 19 surveillance in the store, renovate Olinville s counter area, and 20 build a large concrete room where her gun safes are housed. 21 According to On the same On November 16, 2001, Chief Inspector Petrofsky recommended 22 the reinstatement of Olinville s license. 23 that, [c]onsidering Olinville has been in business for over 30 24 years, it was in the best interests of fairness to return -6- Petrofsky concluded 1 Spinelli s property immediately and allow her thirty days to make 2 the required security improvements. 3 License Division Deputy Inspector Thomas Galati concurred in 4 recommending the return of Olinville s license and firearms. 5 December 5, 2001, the Division sent Spinelli a letter advising 6 her of the license reinstatement, thereby permitting her to 7 reopen her gun shop. 8 resulted in Plaintiffs loss of approximately two months of sales 9 and profits that included the unexplained time lag between the On November 20, 2001, On According to Spinelli, Defendants actions 10 recommendation of license reinstatement on November 20 and the 11 official notice of reinstatement on December 5. 12 On November 8, 2002, Spinelli filed the instant suit against 13 the City pursuant to 42 U.S.C. § 1983. Spinelli alleged that 14 Defendants confiscation of Plaintiffs licenses and weapons was 15 illegal and violated Plaintiffs due process and Fourth 16 Amendment rights. 17 had violated due process by seizing Olinville s weapons and 18 suspending its license without providing the required notice or 19 hearing, and the Fourth Amendment by performing a search of 20 Olinville s premises without probable cause or justification. 21 Spinelli also claimed that [b]y reason of their acts and 22 omissions, Defendants . . . intentionally interfered with 23 Plaintiffs business relationships in violation of New York 24 state law. Specifically, Spinelli alleged that Defendants -7- 1 After both parties moved for summary judgment, the district 2 court granted the City s motion. 3 concluded that the City s search of Olinville s premises, seizure 4 of the firearms, and suspension of Olinville s license were 5 reasonable due to the apparent security lapses at Olinville, 6 and therefore did not violate the Fourth Amendment, which 7 prohibits only unreasonable . . . seizures. 8 First, the district court With respect to Spinelli s due process claim, the district 9 court, citing Sanitation & Recycling Industries v. City of New 10 York, 107 F.3d 985, 995 (2d Cir. 1997), concluded that Spinelli 11 did not have a protectable property interest in her gun dealer 12 license. 13 event, Spinelli had received all the process that was due 14 through notice and an opportunity to be heard, despite, as the 15 court noted, the absence of a formal hearing and the failure of 16 the City s letters to explain what rules and regulations 17 Olinville had violated. 18 Spinelli had a protected property interest in the seized 19 firearms, it concluded that, under the balancing test articulated 20 in Mathews v. Eldridge, 424 U.S. 319, 335 (1976), there was no 21 due process violation in light of the opportunity to be heard 22 and exigent circumstances. 23 constitutional claims, the district court declined to exercise 24 supplemental jurisdiction over Spinelli s tortious interference The district court further determined that, in any Although the district court found that Finally, having dismissed Spinelli s -8- 1 state law claim.2 2 Spinelli appealed to this court. 3 DISCUSSION 4 I. 5 Legal Standards On appeal, we review the district court s grant of summary 6 judgment de novo. Golden Pac. Bancorp v. FDIC, 375 F.3d 196, 200 7 (2d Cir. 2004). 8 only if the pleadings, the discovery and disclosure materials on 9 file, and any affidavits show that there is no genuine issue as The district court may grant summary judgment 10 to any material fact and that the movant is entitled to a 11 judgment as a matter of law. 12 material if it might affect the outcome of the suit under the 13 governing law. 14 248 (1986). Fed. R. Civ. P. 56(c). A fact is Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 15 This standard requires that courts resolve all ambiguities, 16 and credit all factual inferences that could rationally be drawn, 17 in favor of the party opposing summary judgment. 18 Henderson, 257 F.3d 246, 251 (2d Cir. 2001) (internal quotation 19 marks and citation omitted). 20 that there are no genuine issues of material fact, the nonmoving 21 party must come forth with evidence sufficient to allow a 22 reasonable jury to find in [its] favor. 1 2 3 Brown v. Once the moving party demonstrates 2 Id. at 252 (internal The district court also rejected Spinelli s substantive due process claim to the extent that it was alleged in the complaint, a conclusion that Spinelli does not challenge on appeal. -9- 1 citation omitted). 2 judgment motion only by coming forward with evidence that would 3 be sufficient, if all reasonable inferences were drawn in [its] 4 favor, to establish the existence of [an] element at trial. 5 Grain Traders, Inc. v. Citibank, N.A., 160 F.3d 97, 100 (2d Cir. 6 1998) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 7 (1986) and Fed. R. Civ. P. 56(c)). 8 II. 9 Thus, a nonmoving party can defeat a summary The Fourth Amendment Claim First, Spinelli claims that the October 8 warrantless search 10 of Olinville s premises by Captain McSherry violated the Fourth 11 Amendment.3 12 searches and seizures. 13 have established that the Fourth Amendment s prohibition against 14 unreasonable searches applies to administrative inspections of 15 private commercial property. 16 478, 483 (2d Cir. 1981) (internal quotation marks omitted). 17 However, in the case of a closely regulated industry, such as 18 gun dealerships, the traditional Fourth Amendment standard of 19 reasonableness for a government search lessens as the privacy 20 interests of the owner are weakened and the government interests 21 in regulating particular businesses are concomitantly heightened 1 2 3 4 The Fourth Amendment prohibits unreasonable U.S. Const. amend IV. Our prior cases United States v. Gordon, 655 F.2d 3 Spinelli does not argue that the seizure of her suspension of her dealer s license also violated the Amendment. Accordingly, any such argument is waived See Norton v. Sam s Club, 145 F.3d 114, 117 (2d Cir. -10- firearms or Fourth on appeal. 1998). 1 . . . . Palmieri v. Lynch, 392 F.3d 73, 80 (2d Cir. 2004) 2 (quoting New York v. Burger, 482 U.S. 691, 702 (1987)). 3 warrantless inspection[s] of commercial premises may well be 4 reasonable within the meaning of the Fourth Amendment. 5 baseline test for all Fourth Amendment claims is one of 6 objective reasonableness. 7 F.3d 128, 136 (2d Cir. 2005) (quoting Graham v. Connor, 490 U.S. 8 386, 399 (1989)). Thus, Id. The Bryant v. City of New York, 404 9 Here, Spinelli alleges that the October 8 search of 10 Olinville s premises was objective[ly] [un]reasonable[], and 11 thus violated the Fourth Amendment. 12 search was unreasonable because Officer McSherry only conducted 13 it in order to find an excuse to shut down [Olinville] so as to 14 reduce the Precinct s staffing burdens imposed by the month-long, 15 citywide Omega Watch program, and because Officer Carabella, 16 who planned to open his own gun shop, wanted to eliminate the 17 competition. 18 motivation (for which there is no record support), it would be of 19 no moment. 20 actions are objectively reasonable in light of the facts and 21 circumstances confronting them, without regard to their 22 underlying intent or motivation. 23 Bryant, 404 F.3d at 136 (extending Graham, an excessive force 24 case, to pretrial detentions following warrantless arrests); Spinelli says that the Even if we were to assume such a malicious The relevant inquiry is whether the officers -11- Graham, 490 U.S. at 397; see 1 Kerman v. City of New York, 261 F.3d 229, 235 (2d Cir. 2001) 2 (same, as to warrantless searches). 3 motivations of the individual officers . . . ha[ve] no bearing on 4 whether a particular seizure is unreasonable under the Fourth 5 Amendment. 6 intentions will not make a Fourth Amendment violation out of . . 7 . objectively reasonable conduct, nor will an officer s good 8 intentions make . . . objectively unreasonable . . . [conduct] 9 constitutional. Graham, 490 U.S. at 397. [T]he subjective An officer s evil Id.; see also Scott v. United States, 436 U.S. 10 128, 138 n.12 (1978) (collecting cases). 11 one or more officers had an ulterior motive for the search is 12 irrelevant to the issue of whether the search itself violated the 13 Fourth Amendment. 14 Spinelli s claim that Spinelli also argues that because the search was warrantless 15 and not conducted pursuant to established regulations, it was 16 necessarily unreasonable. 17 applicable regulation that permits the police to search a gun 18 store s premises in New York City is 38 RCNY § 1-06(i), which 19 creates a cooperative inspection program whereby gun store 20 owners can set up a time for a voluntary police inspection. 21 Spinelli, however, overlooks a separate provision of the 22 applicable regulations, 38 RCNY § 4-06(a)(3), that provides that 23 the gun dealer s premises and firearms[] shall be subject to 24 inspection at all times by members of the Police Department. Spinelli claims that the only -12- 1 (Emphasis added). Spinelli s allegations that the Regulations 2 make no provision for warrantless searches, and that McSherry 3 ignored the available procedure, are belied by § 4-06(a)(3). 4 Nor does the warrantless search authority created by § 4- 5 06(a)(3) violate the Fourth Amendment. The Supreme Court has 6 held that warrantless administrative searches are justified 7 where the burden of obtaining a warrant [would be] likely to 8 frustrate the governmental purpose behind the search. 9 Mun. Ct. of San Fran., 387 U.S. 523, 533 (1967). Camara v. Under certain 10 circumstances, like those presented here, an effective inspection 11 of a gun dealer s premises requires that searches be unannounced 12 in order to discover potential security infractions. 13 States v. Biswell, 406 U.S. 311, 316 (1972); see also id. ( When 14 a dealer chooses to engage in this pervasively regulated business 15 and to accept a federal license, he does so with the knowledge 16 that his business records, firearms, and ammunition will be 17 subject to effective inspection. ); United States v. Streifel, 18 665 F.2d 414, 419 n.8 (2d Cir. 1981) (concluding that gun dealers 19 have a greatly reduced expectation of privacy because they know 20 that they are subject to a full arsenal of governmental 21 regulation ) (quoting Marshall v. Barlow s Inc., 436 U.S. 307, 22 313 (1978)). 23 store, conducted pursuant to established regulatory authority, 24 was objectively reasonable and did not violate the Fourth See United We hold that the warrantless search of Spinelli s -13- 1 Amendment. 2 III. The Due Process Claim 3 Spinelli also alleges that, contrary to the district court s 4 conclusion, the City s conduct did not provide her with the 5 process that was due. 6 advising her that Olinville s license had been suspended for 7 failure to provide adequate security, did not adequately 8 apprise her of the grounds for the suspension, and that simply 9 providing her with the contact information for the investigating 10 officer was insufficient to afford her a meaningful opportunity 11 to be heard. 12 13 A. 14 To succeed on a claim of procedural due process deprivation Spinelli argues that the City s letters, Did Spinelli Have A Protected Property Interest In Her Gun Dealer License? 15 under the Fourteenth Amendment -- that is, a lack of adequate 16 notice and a meaningful opportunity to be heard -- a plaintiff 17 must first establish that state action deprived him of a 18 protected property interest. 19 Property interests that are protected by the Due Process Clause 20 of the Fourteenth Amendment are not created by that amendment; 21 they are defined by existing rules or understandings that stem 22 from an independent source such as state law. 23 Roth, 408 U.S. 564, 577 (1972). 24 interest in a public benefit, the plaintiff must show a 25 legitimate claim of entitlement to such interest that is Sanitation, 107 F.3d at 995. Bd. of Regents v. When alleging a property -14- 1 grounded in established law. Id. 2 The district court believed that, because the City had 3 broad discretion over whether to grant or deny Olinville s gun 4 dealership license, Spinelli had no protected property interest 5 in the license, and thus her due process claim could not succeed. 6 We do not agree. 7 interest in a possible future [business] license, Sanitation, 8 107 F.3d at 995, the situation changes once the license is 9 obtained, see Dwyer v. Regan, 777 F.2d 825, 830-31 (2d Cir. While a person does not have a protected 10 1985). 11 speculative property interest, once the government has granted a 12 business license to an individual, the government cannot 13 depriv[e] [the individual of] such an interest . . . without 14 appropriate procedural safeguards. 15 134, 167 (1974) (Powell, J., concurring in part). 16 Burson, 402 U.S. 535, 539 (1971) ( Once licenses are issued, . . 17 . their continued possession may become essential in the pursuit 18 of a livelihood. ). 19 While a possible future license involves a purely Arnett v. Kennedy, 416 U.S. See Bell v. Although there may be no protected property interest where 20 the licensor has broad discretion to revoke the license, see Bach 21 v. Pataki, 408 F.3d 75, 80-81 (2d Cir. 2005), here, such 22 discretion was carefully constrained. 23 provided that, under specific circumstances, the City could 24 revoke or suspend Spinelli s gun dealer license, 38 RCNY § 4- -15- The relevant regulations 1 04(l), but the City did not have unfettered discretion to do so. 2 Unlike the gun carrier permits in the cases cited by the district 3 court, see Bach, 408 F.3d 75; Potts v. City of Phila., 224 F. 4 Supp. 2d 919 (E.D. Pa. 2002), over which the government had 5 considerable discretion to suspend or revoke a license, Bach, 6 408 F.3d at 79, the City s discretion in this case was cabined by 7 the regulations good cause requirement, see 38 RCNY § 4-04(l). 8 See, e.g., Dwyer, 777 F.2d at 827 (plaintiff s employment could 9 only be terminated for incompeten[ce] or misconduct ). Where 10 a license can be suspended only upon a satisfactory showing of 11 misconduct, the licensee has a property interest in his license 12 sufficient to invoke the protection of the Due Process Clause. 13 Barry v. Barchi, 443 U.S. 55, 64 (1979); see Richardson v. Town 14 of Eastover, 922 F.2d 1152, 1157 (4th Cir. 1991) ( [A] state- 15 issued license for the continued pursuit of the licensee s 16 livelihood, renewable periodically on the payment of a fee and 17 revocable only for cause, creates a property interest in the 18 licensee. ). 19 Spinelli did not have a property interest in her gun dealer 20 license that could be protected by the Due Process Clause. Thus, the district court erred in holding that 21 B. Was Spinelli Denied Due Process? 22 The district court also concluded that Spinelli received 23 all the process that was due when the City deprived her of her 24 gun dealer license and firearms. The touchstone of due process, -16- 1 of course, is the requirement that a person in jeopardy of 2 serious loss (be given) notice of the case against him and 3 opportunity to meet it. 4 Joint Anti-Fascist Comm. v. McGrath, 341 U.S. 123, 171-72 (1951) 5 (Frankfurter, J., concurring)); see also Goldberg v. Kelly, 397 6 U.S. 254, 267 (1970) (requiring an opportunity to be heard . . . 7 at a meaningful time and in a meaningful manner ) (internal 8 quotation marks and citations omitted). 9 flexible and calls for such procedural protections as the Mathews, 424 U.S. at 348-49 (quoting However, due process is 10 particular situation demands. 11 471, 481 (1972). 12 will depend on appropriate accommodation of the competing 13 interests involved. 14 Cir. 2002) (quoting Logan v. Zimmerman Brush Co., 455 U.S. 422, 15 434 (1982)). 16 must weigh (1) the private interest affected, (2) the risk of 17 erroneous deprivation through the procedures used and the value 18 of other safeguards, and (3) the government s interest. 19 424 U.S. at 335. 20 Morrissey v. Brewer, 408 U.S. The timing and nature of the required hearing Krimstock v. Kelly, 306 F.3d 40, 51-52 (2d In determining how much process is due, a court Mathews, Applying the Mathews test to this case, the district court 21 found that although Spinelli had some private interest in the 22 vouchered guns taken by the City, the City gave Spinelli an 23 adequate notice and opportunity to be heard by negotiating with 24 her counsel over the deprivation, which resulted in the -17- 1 reinstatement of her license and return of her firearms. 2 district court also found that there were exigent 3 circumstances justifying the City s conduct, which argued 4 strong[ly] in favor of the public interest. 5 court concluded that the Mathews factors weighed in favor of the 6 City, and dismissed Spinelli s due process claim. 7 The Thus, the district On appeal, Spinelli challenges the district court s Mathews 8 analysis, arguing that (1) she had a strong interest in retaining 9 her license and firearms, (2) there was a high risk of erroneous 10 deprivation because the City provided her with neither a 11 meaningful opportunity for a hearing nor adequate notice of the 12 grounds for her suspension, and (3) the City s claim of an 13 urgent need to seize the firearms and suspend her license was 14 insufficient to justify denying her a pre-deprivation hearing, 15 much less a post-deprivation one. 16 17 18 1. Pre-Deprivation Due Process We disagree with Spinelli s contention that she was entitled 19 to pre-deprivation due process. [A]lthough notice and a pre[-] 20 deprivation hearing are generally required, in certain 21 circumstances, the lack of such pre[-]deprivation process will 22 not offend the constitutional guarantee of due process, provided 23 there is sufficient post[-]deprivation process. 24 Weiden, 188 F.3d 56, 61 (2d Cir. 1999). 25 action by the State or the impracticality of providing any -18- Catanzaro v. [N]ecessity of quick 1 meaningful pre[-]deprivation process, when coupled with the 2 availability of some meaningful means by which to assess the 3 propriety of the State s action at some time after the initial 4 taking, can satisfy the requirements of procedural due process. 5 Id. (internal quotation marks and citation omitted). 6 Here, exigent circumstances necessitating very prompt 7 action on the part of the City were sufficient to justify the 8 City s failure to provide Spinelli with pre-deprivation notice or 9 a hearing. United States v. All Assets of Statewide Auto Parts, 10 Inc., 971 F.2d 896, 903 (2d Cir. 1992) (citing Fuentes, 407 U.S. 11 at 91-92). 12 ensuring the security of gun shops, which was heightened further 13 in the days immediately following the September 11th terrorist 14 attacks, when the dimensions of the terrorist threat were 15 unknown. 16 pursuant to the City s regulatory authority; the search was 17 conducted pursuant to 38 RCNY § 4-06(a)(3), and the suspension 18 was authorized by 38 RCNY § 1-04(f). 19 903. 20 The City and the public have a strong interest in Additionally, the search and the suspension were taken See All Assets, 971 F.2d at The record demonstrates that the City had sufficient cause 21 to take prompt action to address the security infractions at 22 Olinville observed by Officer McSherry. 23 downplaying these infractions, has never disputed them, and 24 indeed, took strong measures to remedy them. -19- Spinelli, while Were we to conclude 1 that prompt action was not required, we would tie the hands of 2 police faced with obvious security lapses at gun stores until a 3 hearing could be held, and thereby substantially undermine the 4 state interest in public safety. 5 18 (1979). 6 October 8, the City was not required to provide Spinelli with 7 pre-deprivation due process before suspending her license and 8 seizing her firearms. 9 10 11 2. Mackey v. Montrym, 443 U.S. 1, Under the circumstances presented to the police on However, our inquiry does not end there. Post-Deprivation Due Process Spinelli s primary argument on appeal is that the City never 12 provided her with the opportunity for a meaningful post- 13 deprivation notice and hearing despite her entitlement to one 14 under the City s own regulations. 15 the City essentially concedes, that in practice the City does not 16 provide licensees with notice or an opportunity for a formal 17 hearing until after the police investigation is completed, which 18 the City acknowledges can take months or years. 19 to the Mathews factors, now in the post-deprivation context. a. 20 21 Spinelli further alleges, and Again, we turn The First Mathews Factor First, the private interest implicated in this case is 22 strong. Spinelli s private interest is the interest in 23 operating a business and, stated more broadly, pursuing a 24 particular livelihood. 25 97-4144, 1999 WL 74020, at *3 (10th Cir. Feb. 17, 1999) (citing See Tanasse v. City of St. George, No. -20- 1 Dixon v. Love, 431 U.S. 105, 113 (1977)). The Supreme Court has 2 repeatedly recognized the severity of depriving someone of his 3 or her livelihood. 4 Moreover, [b]ecause of the nature of this interest, a licensee 5 erroneously deprived of a license cannot be made whole simply by 6 reinstating the license. 7 fact, the interim period between erroneous deprivation and 8 reinstatement can be financially devastating to the licensee. 9 Id. FDIC v. Mallen, 486 U.S. 230, 243 (1988). Tanasse, 1999 WL 74020, at *3. In The district court s conclusion that the extent of 10 [Spinelli s] interest [in her deprived property] is not entirely 11 clear to the Court, led it to erroneously discount Spinelli s 12 interest in both her gun dealer license and her seized firearms. 13 Without firearms to sell, Spinelli could not do business as a gun 14 dealer at all, whether or not she had a dealer license. 15 first Mathews factor favors Spinelli. b. 16 The The Second Mathews Factor 17 Next, we consider the risk of an erroneous deprivation 18 under the procedures used by the City, along with the probable 19 value, if any, of additional or substitute procedural 20 safeguards. 21 post-deprivation procedures used by the City did not adequately 22 afford her due process because they failed to provide either 23 adequate notice or a meaningful opportunity to be heard in a 24 sufficiently timely manner. Mathews, 424 U.S. at 335. We agree. -21- Spinelli argues that the i. 1 2 Notice Notice, to comply with due process requirements, . . . must 3 set forth the alleged misconduct with particularity. In re 4 Gault, 387 U.S. 1, 33 (1967) (internal quotation marks omitted). 5 The particularity with which alleged misconduct must be described 6 varies with the facts and circumstances of the individual case; 7 however, due process notice contemplates specifications of acts 8 or patterns of conduct, not general, conclusory charges 9 unsupported by specific factual allegations. The degree of 10 required specificity also increases with the significance of the 11 interests at stake. 12 practice of one s chosen profession, Galvin v. N.Y. Racing 13 Ass n, 70 F. Supp. 2d 163, 176 (E.D.N.Y. 1998), are 14 substantial, Barry, 443 U.S. at 64. 15 Here, these interests, implicating the The notice actually provided in this case was 16 constitutionally inadequate. The regulations specified that a 17 license suspension will result in the issuance of a Notice of 18 Determination Letter to the licensee, which shall state in brief 19 the grounds for the suspension or revocation and notify the 20 licensee of the opportunity for a hearing. 21 Had this regulation been complied with, the notice might have 22 been sufficient, depending on the specificity of the grounds 23 provided and the promptness of the hearing. 24 sent to Spinelli, however, only informed her of the license -22- 38 RCNY § 1-04(f). The cursory letters 1 suspension and the status of the investigation. 2 conclusory statement that security at Olinville was inadequate, 3 there was no specificity as to the actual infractions. 4 was left to guess at the security breaches to which the letters 5 referred. 6 reasonably . . . convey the required information that would 7 permit her to present [her] objections to the City. 8 Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950). 9 Beyond the Spinelli The notice given to Spinelli plainly failed to Mullane v. The City relies on the fact that Chambers, Spinelli s able 10 counsel, through successful investigation, was able to determine 11 the factual nature of the charges. 12 of more than not obstructing a lawyer s investigation. 13 that Spinelli s counsel eventually learned of the specific nature 14 of the charges after meeting on various occasions with the City 15 does not obviate the City s failure to provide adequate notice of 16 those charges. 17 not immediately providing Spinelli with the information she 18 needed to prepare meaningful objections or a meaningful defense.4 19 Notifying Spinelli of the specific security breaches at Olinville 20 would have entailed little or no administrative inconvenience to 21 the City; indeed, simply attaching Officer McSherry s report to 1 2 3 4 But adequate notice consists The fact The City has advanced no legitimate reason for 4 Spinelli s claim of purposeful inadequacy of notice based on the malicious intent of certain members of the 47th Precinct to close Olinville for their benefit, as previously noted, is without support in the record. -23- 1 the letters would have sufficed. 2 case was scarcely more than a gesture on the City s part, see 3 Luessenhop v. Clinton County, N.Y., 466 F.3d 259, 269 (2d Cir. 4 2006), and was not constitutionally adequate. ii. 5 The notice provided in this Opportunity To Be Heard 6 Despite the inadequate notice, Spinelli, with counsel s 7 assistance, was able to reinstate her gun dealer license 58 days 8 after its suspension. 9 able to have her license suspension lifted and to retrieve her The City argues that, because Spinelli was 10 property in less than two months, her due process rights were not 11 violated. 12 did not result from the City s affording her due process, but 13 despite its absence. 14 This is a non-sequitur. Spinelli s eventual success The City contends that because Spinelli voluntarily opted 15 not to pursue a formal hearing through the administrative 16 process, and instead chose to have her attorney negotiate with 17 the City, she cannot challenge the City s process, which she 18 never utilized. 19 into self-help by the inadequacy of process can bar her from 20 pressing this claim. 21 is that Spinelli could have received a prompt hearing if she had 22 wanted one. 23 hearing process was not available to Spinelli during the City s 24 pending investigation into McSherry s report. We do not think that Spinelli s being forced The unstated premise of the City s argument In fact, the contrary is true. -24- The administrative Both Sergeant 1 Kaplon, the officer in charge of the investigation, and Margaret 2 Shields, a hearing officer in the License Division, testified 3 that Spinelli would not have been entitled to a hearing until the 4 completion of the investigation into McSherry s report, which 5 Shields conceded could take months to . . . years to decide. 6 Furthermore, although due process may tolerate some period 7 of delay between a deprivation of property and a hearing, there 8 is no justification for indeterminately delaying a hearing for a 9 person in Spinelli s circumstances while the investigation runs 10 its course. In Mallen, the Supreme Court held that, 11 12 13 14 15 16 17 18 19 20 486 U.S. at 242; see id. (noting that the significance of such a 21 delay [on due process] cannot be evaluated in a vacuum ). 22 [i]n determining how long a delay is justified in affording a post-suspension hearing and decision, it is appropriate to examine the importance of the private interest and the harm to this interest occasioned by delay; the justification offered by the Government for delay and its relation to the underlying governmental interest; and the likelihood that the interim decision may have been mistaken. Here, the City s blanket policy of only providing a hearing 23 after the investigation is completed cannot be squared with due 24 process. 25 strong, and the City s delay in providing Spinelli with a prompt 26 hearing while her business was closed threatened significant 27 financial loss over an extended period. 28 that an investigation can take months to years to decide, 29 negates any claim that Spinelli s investigation could be As we have noted, in this case the private interest was -25- The City s concession 1 completed in a reasonable amount of time. 2 proposition, where livelihoods may be at stake and the timing is 3 subject to the competences of varying investigators, the holding 4 of a hearing possibly years after a license suspension cannot 5 amount to a justif[iable] . . . delay. 6 McQueen, 580 F.2d 1001, 1006 (9th Cir. 1978) (plaintiff s due 7 process rights violated where school district delayed formal 8 hearing for two years); Brown v. Bathke, 566 F.2d 588, 593 (8th 9 Cir. 1977) (same). 10 As a blanket Id. See Cain v. Nor does such a delay serve any important underlying 11 governmental interest. 12 believe the contrary to be true: 13 promptly join issue with the grounds for the investigation and to 14 present her views advances the City s understanding of the 15 situation while facilitating prompt remediation, all in the 16 public interest. 17 exemplified by the instant case -- had Spinelli not been able to 18 afford an attorney, the City would have incurred significant 19 costs by investigating the Olinville security lapses, only to 20 determine months or years later that Spinelli could have remedied 21 the situation with a few basic improvements to Olinville. 22 meantime, the delay would have wiped out Spinelli s livelihood. 23 We have no doubt that the delay conceded by the City would 24 Mallen, 486 U.S. at 242. In fact, we Permitting a licensee both to The usefulness of a prompt hearing is have violated Spinelli s due process rights. -26- In the But what about the 1 actual delay in this case that was limited to fifty-eight days 2 due to Spinelli s self-help? 3 did not take years for the City to restore Spinelli s license and 4 return her firearms, we conclude that the delay Spinelli actually 5 experienced still exceeded the bounds of due process. 6 Notwithstanding that ultimately it [E]ven a brief and provisional deprivation of property 7 pending judgment is of constitutional importance. Krimstock, 8 306 F.3d at 51-52; see Fuentes, 407 U.S. at 84-85 ( [I]t is now 9 well settled that a temporary, non[-]final deprivation of 10 property is nonetheless a deprivation in the terms of the 11 Fourteenth Amendment. ); see also United States v. Monsanto, 924 12 F.2d 1186, 1192 (2d Cir. 1991) (en banc) (noting that a 13 temporary and non[-]final removal of a defendant s assets, 14 pursuant to a federal criminal forfeiture statute and pending 15 resolution of the criminal case, is, nonetheless, a deprivation 16 of property subject to the constraints of due process ) 17 (quotation marks omitted). 18 of Spinelli s property pending investigation, it was incumbent 19 upon the City to provide a prompt hearing. 20 Spinelli was able to retain an attorney familiar with the 21 licensing system does not cure the City s failure to provide 22 constitutionally adequate process by which Spinelli could be 23 heard. 24 Thus, once the City took possession The fact that In sum, nothing about the process employed by the City in -27- 1 this case provided any safeguards [against] an unacceptable risk 2 of arbitrary and erroneous deprivations of personal liberties. 3 Town of Castle Rock, Colo. v. Gonzales, 545 U.S. 748, 793 (2005) 4 (Stevens, J., dissenting) (internal quotation marks and 5 alterations omitted). 6 the period of her deprivation was reduced to fifty-eight days 7 neither cures the constitutional infirmity, nor erases the risk 8 of erroneous deprivation inherent in the City s policy. 9 the second Mathews factor also favors Spinelli. c. 10 The fact that through Spinelli s efforts Thus, The Third Mathews Factor 11 The third Mathews factor examines the Government s 12 interest, including the function involved and the fiscal and 13 administrative burdens that the additional or substitute 14 procedural requirement would entail. 15 The district court concluded that the third Mathews factor 16 weighed in the City s favor because, in the post-September 11th 17 environment, the City had to act quickly in response to the 18 perceived security lapses. 19 seizure of the guns was necessary to secure an important public 20 interest, [and] there was a need for prompt action [by the 21 NYPD]. Mathews, 424 U.S. at 335. According to the district court, the 22 The district court, however, applied the third Mathews 23 factor by weighing the City s interest only with respect to pre- 24 deprivation due process, not post-deprivation due process. -28- In 1 the latter context, the existence of exigent circumstances 2 warranting a deprivation before holding a hearing is irrelevant. 3 The relevant inquiry is whether the City had a legitimate 4 interest in not providing Spinelli with meaningful post- 5 deprivation due process. 6 Our decision in Krimstock v. Kelly is instructive. The 7 Krimstock plaintiffs challenged a City statute that permitted the 8 City to hold motor vehicles that were seized as a result of DWI 9 offenses, but had not yet been subject to an actual forfeiture 10 proceeding (i.e., post-seizure, pre-judgment vehicles). 306 11 F.3d at 48. 12 argued that drivers should not be permitted to challenge the 13 validity of the City s retention of their vehicles prior to final 14 judgment, because (1) the drivers could sell the vehicles prior 15 to the forfeiture proceedings, id. at 64-65, and (2) the 16 possibility existed that the drivers might commit another DWI, 17 creating an executive urgency, id. at 66. 18 there were other means of ensuring that the vehicles would not be 19 sold prior to forfeiture, id. at 65, and that the urgency that 20 permitted the City to seize the vehicles without a pre- 21 deprivation hearing did not extend to the post-deprivation 22 context, because by that time the drivers would have regained 23 their sobriety, thereby eliminating the executive urgency, id. 24 at 66. In assessing the third Mathews factor, the City We concluded that We held that, promptly after their vehicles are seized . -29- 1 . . as alleged instrumentalities of crime, plaintiffs must be 2 given an opportunity to test the probable validity of the City s 3 deprivation of the vehicles. 4 Id. at 70. Here, the City s asserted reasons for denying Spinelli a 5 prompt post-deprivation hearing are similar to those it advanced 6 in Krimstock, namely, that the urgent security situation in post- 7 September 11th New York City required the suspension of 8 Spinelli s license and seizure of her firearms without providing 9 due process. But this logic only explains the absence of a pre- 10 deprivation hearing; it does not explain why Spinelli should not 11 be allowed to promptly challenge the City s actions after the 12 suspension and seizure. 13 such as Spinelli her livelihood for an indeterminate period, 14 possibly years, even if the circumstances that led to the City s 15 action have been remedied or never existed at all. 16 there no benefit to the City from such a hearing delay pending 17 investigation, but the unnecessary deprivation of the citizen s 18 livelihood actually incrementally threatens to harm the City, 19 which is deprived of sales taxes, while increasing the likelihood 20 of the administrative and fiscal burdens of an unnecessary 21 investigation. The City s policy is to deny a dealer Not only is Thus, the third Mathews factor favors Spinelli. 22 23 C. 24 Although Spinelli s license has been reinstated and her 25 Summary Judgment Should Be Entered In Favor Of Spinelli On Her Due Process Claim. firearms returned, her due process claim nevertheless remains a -30- 1 live controversy. 2 she was due, [D]efendants must still answer for any damages they 3 may have caused with their [suspension of] [her] license without 4 due process. 5 (D.P.R. 2006). 6 her damages, by computing the loss from the time the City should 7 have provided a prompt post-deprivation hearing until December 5, 8 2001, when the suspension was lifted and the firearms were 9 returned.5 10 IV. 11 Because she never received the process that Ginorio v. Contreras, 409 F. Supp. 2d 101, 108 The district court must permit Spinelli to prove The Tortious Interference Claim The district court dismissed Spinelli s state-law tortious 12 interference claim for lack of supplemental jurisdiction. 13 Reversal of Spinelli s due process claim also reinstates the 14 district court s supplemental jurisdiction over her state law 15 claim. 16 F.3d 61, 79 (2d Cir. 2003). 17 is resolved promptly, the district court should then consider 18 whether to retain or dismiss without prejudice Spinelli s 19 tortious interference claim. If the aforementioned damages issue CONCLUSION 20 21 1 2 3 4 5 See 28 U.S.C. § 1367; Zheng v. Liberty Apparel Co., 355 For the foregoing reasons, the district court s judgment is 5 The question of when a prompt post-deprivation hearing should have been held, and hence the time during which damages would accrue, we leave up to the district court to determine after briefing and in light of the particular circumstances of this case and opinion. -31- 1 AFFIRMED with respect to the appellants Fourth Amendment claim. 2 The district court s judgment is REVERSED with respect to the 3 appellants due process claim, and the case is REMANDED to the 4 district court to enter summary judgment in favor of the 5 appellants on their due process claim and for the calculation of 6 damages to be awarded to the appellants on that claim. 7 district court s judgment dismissing the appellants tortious 8 interference claim is also VACATED, and the cause is REMANDED to 9 the district court for further proceedings consistent with this 10 opinion. -32- The

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