Empire Transit Mix, Inc. v. Giuliani

37 F. Supp. 2d 331, 1999 U.S. Dist. LEXIS 4855, 1999 WL 212696
CourtDistrict Court, S.D. New York
DecidedApril 9, 1999
Docket99 CIV. 2348 DB
StatusPublished
Cited by10 cases

This text of 37 F. Supp. 2d 331 (Empire Transit Mix, Inc. v. Giuliani) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Empire Transit Mix, Inc. v. Giuliani, 37 F. Supp. 2d 331, 1999 U.S. Dist. LEXIS 4855, 1999 WL 212696 (S.D.N.Y. 1999).

Opinion

MEMORANDUM OPINION

KAPLAN, District Judge.

Empire Transit Mix, Inc. (“Empire”) brings this action for an injunction compelling the City of New York (the “City”) to revoke its prohibition on allowing plaintiff to supply concrete to contractors working on City construction projects. The matter is before the Court on Empire’s motion for *333 a preliminary injunction and the defendants’ motion to dismiss.

Facts

Empire is a New York corporation in the business of supplying transit-mix concrete to construction projects. 1 Approximately forty percent of its gross sales comes from contractors working under contract with the City on various City projects. 2 Of special pertinence to the present dispute are several City construction projects for the City’s Departments of Parks & Recreation (the “DPR”) and Design & Construction (the “DDC”). 3

On or about October 3, 1997, Empire entered into an arrangement with Excel Group, Inc. (“Excel”), a subcontractor 4 on the DPR’s Foley Square reconstruction project, to supply transit-mix concrete for installation. On January 20, 1999, it entered into an arrangement with Cobar Industries, Inc., also a subcontractor, to do the same on the DPR’s City Hall Park project. 5 Empire alleges also that at the end of March it was supplying concrete to contractors on three DDC projects — a Fire Department building, 6 the reconstruction of McGuiness Boulevard, 7 and the construction of sanitary sewers on Parsons Boulevard. 8

Defendants allege that some time in March 1999, the City obtained “significant negative information” concerning Empire 9 through its Vendor Information Exchange System database (“VENDEX”). 10 This information appears to have been the subject of an article that was being prepared by the New York Times regarding Empire’s alleged affiliation with the Laquila Construction Company, a firm with a somewhat checkered past. 11

Plaintiff claims that on or about March 19, 1999 the DPR directed the prime contractor on the City Hall Park project to stop using Empire concrete and to submit two new concrete suppliers for DPR approval. 12 Three days later, the DPR allegedly gave the same message to the prime contractor on the Foley Square project. 13 At a March 23 meeting, the DPR informed Empire that the Mayor’s Office had directed that Empire be removed as a concrete supplier on the City Hall and Foley Square projects because of the above mentioned New York Times article which appeared that day. 14

On March 24, Empire was notified by the DDC that it no longer would permit Empire concrete on its construction projects. 15 It allegedly directed the prime *334 contractors on its contracts to cease using Empire as a supplier shortly thereafter. 16

On March 30, Empire sought a temporary restraining order from this Court enjoining the City from continuing the ban on Empire’s participation in City projects, claiming that defendants’ de facto debarment of Empire from supplying concrete on those projects without a pre-deprivation hearing violated its rights to due process and equal protection of the laws. 17 This Court denied a temporary restraining order and scheduled a hearing on the motion for a preliminary injunction for April 7.

Discussion

The Preliminary Injunction Standard

“In order to justify the award of a preliminary injunction, the moving party must first demonstrate that it is likely to suffer irreparable harm in the absence of the requested relief.” 18 The threat of irreparable injury must be imminent or certain, not a matter of speculation. 19 Once the likelihood of irreparable harm has been demonstrated, a movant ordinarily is entitled to relief if it demonstrates “either (1) ‘a likelihood of success on the merits’ or (2) ‘sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly’ in the movant’s favor.” 20 Where, however, a movant seeks to enjoin “government action taken in the public interest pursuant to a statutory or regulatory scheme,” it may succeed only by demonstrating a likelihood of success on the merits in addition to irreparable harm. 21

While it perhaps is arguable that Empire is subject to the heightened standard applicable where a litigant seeks to enjoin certain types of governmental action, the City does not so assert. 22 Rather, it assumes that the motion is governed by the usual two pronged standard applicable in this Circuit. The Court therefore proceeds on that basis.

Irreparable Injury

As the Court held in denying Empire’s application for a temporary restraining order, it plainly has an adequate remedy at law with respect to the loss of sales on its existing arrangements. The contractors or subcontractors with whom it was dealing, given the City’s action, will purchase concrete from other suppliers. The amount of sales thus diverted from Empire will be determinable to the last cubic yard. In consequence, the economic loss to Empire as a result of the City’s action, should it ultimately be held unlawful, will be readily determinable. But the arrangements in respect of existing contracts are not the whole story.

The City’s action probably will prevent contractors from considering Empire in sourcing their concrete requirements on future City contracts. As one could not determine the extent to which Empire would have obtained such supply contracts, absent the City’s recent action, proof of a damage claim with respect to such lost business would be impossible. Moreover, in view of Empire’s unrebutted claim that forty percent of its gross sales have been on City construction projects, the likeli *335 hood of such losses is sufficiently substantial to conclude that Empire is threatened with irreparable injury by the City’s action.

The Procedural Due Process Claim

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Cite This Page — Counsel Stack

Bluebook (online)
37 F. Supp. 2d 331, 1999 U.S. Dist. LEXIS 4855, 1999 WL 212696, Counsel Stack Legal Research, https://law.counselstack.com/opinion/empire-transit-mix-inc-v-giuliani-nysd-1999.