Flying Dog Brewery, LLLP v. Michigan Liquor Control Commission

870 F. Supp. 2d 477, 2012 U.S. Dist. LEXIS 90076, 2012 WL 2512935
CourtDistrict Court, W.D. Michigan
DecidedJune 28, 2012
DocketCase No. 1:11-CV-307
StatusPublished
Cited by4 cases

This text of 870 F. Supp. 2d 477 (Flying Dog Brewery, LLLP v. Michigan Liquor Control Commission) is published on Counsel Stack Legal Research, covering District Court, W.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Flying Dog Brewery, LLLP v. Michigan Liquor Control Commission, 870 F. Supp. 2d 477, 2012 U.S. Dist. LEXIS 90076, 2012 WL 2512935 (W.D. Mich. 2012).

Opinion

OPINION AND ORDER

ROBERT J. JONKER, District Judge.

This case arises out of Defendant Michigan Liquor Control Commission’s (the “Commission”) initial denial of Plaintiffs application for a license to sell its “Raging Bitch” beer in Michigan. The Commission initially determined that Plaintiffs label was “detrimental to the health, safety, or welfare of the general public,” in violation of Mich. Admin. Code R. 436.1611(l)(c). Plaintiff sued under 42 U.S.C. § 1983 for both injunctive relief against the Commission, and for damages against the five commissioners (the “Commissioners”) in office when Plaintiffs licensing application was denied. The Commission later issued an administrative order reversing its previous orders, rescinding the beer-labeling rule underpinning their earlier decision, and granting Plaintiffs request for a license to sell Raging Bitch beer in Michigan. (docket # 33-2.) The Commission’s action mooted Plaintiffs request for injunctive relief, (docket # 43.) All that remains are Plaintiffs claims for damages against the Commissioners in their individual capacities. Before the Court is Defendants’ Motion to Dismiss the claims against the Commissioners based on absolute quasi-judicial immunity, or in the alternative, qualified immunity (docket # 53), and Plaintiffs Motion for Partial Summary Judgment Regarding Liability (docket # 56). After reviewing all matters of record, the Court GRANTS Defendants’ Motion, and DENIES Plaintiffs Motion.

BACKGROUND

Under Michigan law, the Commission has the “sole right, power, and duty to [480]*480control the alcoholic beverage traffic” within the State, including regulating the sale of alcoholic beverages such as beer, wine, and liquor. Mich. Comp. L. § 436.1201(2). The Commission is comprised of five members. Three of the members- — the Administrative Commissioners — have the responsibility for decisions “relating to licensing ... merchandising, and distribution.” Id. § 436.1209(2). The other two members— the Hearing Commissioners — -have no role in the licensing process, but rather hear and decide violation cases relating to existing rules and regulations promulgated by the State legislature and the Commissioners. (Id.) At all times relevant to this litigation, Defendants Nida Simona, Patrick Gagliardi, and Donald Weatherspoon served as Administrative Commissioners, and Defendants Colleen Pobur and Edward Gaffney served as Hearing Commissioners. (Compl., docket # 1, at ¶ 18.)

Before beer can be sold in Michigan, it must receive Commission approval. Mich. Admin. Code R. 436.1611(1)(c). On September 17, 2009, Plaintiff applied for a license to sell “Raging Bitch” beer, a Belgian-style India Pale Ale. On November 18, 2009, the three Administrative Commissioners denied Plaintiffs application, reasoning that the label contained material that was “detrimental to the health, safety, or welfare of the general public.” (docket # 11-2.) The denial was made under the beer-labeling rule in effect at the time, which granted the Commission the authority to “disapprove any beer label submitted for registration that is deemed to promote violence, racism, sexism, intemperance, or intoxication or to be detrimental to the health, safety, or welfare of the general public.” Mich. Admin. Code R. 436.1611(l)(c)(before the amendment effective October 19, 2011). Plaintiff requested an appeal hearing, which a two-member majority of the Administrative Commissioners conducted, (docket # 11-3.) After the hearing, the Administrative Commissioner’s original decision was affirmed for substantially the same reasons, (docket # 11-4.) At no time were the two Hearing Commissioners involved in the decision to deny Plaintiff its license to sell.

On March 25, 2011, Plaintiff filed this action against Defendants, alleging the Commission’s decision violated Plaintiffs First Amendment rights, (docket #1.) The Complaint sought injunctive relief preventing the enforcement of Rule 436.1611(l)(c) against Plaintiff and compensatory damages against the Commissioners in then-individual capacities. (Id.) While this case was pending, the Administrative Commissioners revised their prior decision in light of Sorrell v. IMS, — U.S.-, 131 S.Ct. 2653, 180 L.Ed.2d 544 (2011). (docket # 54, at 11.) Following this review, the Administrative Commissioners decided to approve the “Raging Bitch” label for use in connection with Michigan beer sales and to rescind Rule 436.1611(l)(c), as well as the analogous rules that applied to labeling wine and spirits, (docket ## 39-1, 39-2.) As a result of Defendants’ actions, Plaintiff withdrew its then-pending Motion for a Preliminary Injunction. The parties agree that Plaintiffs claims for damages against the Commissioners in their individual capacities are the only claims that remain in dispute, and are the subject of the Motions currently before the Court.

ANALYSIS

Defendants argue that they are immune from Plaintiffs claims for damages. The Administrative Commissioners argue that they were acting in a quasi-judicial role when they denied the application based on Rule 436.1611(l)(c), and are therefore entitled to absolute immunity from Plaintiffs claims against them. Alternatively, the Administrative Commissioners assert that qualified immunity requires dismissal of Plaintiffs claims, because their actions [481]*481were not prohibited by any clearly established law. The Hearing Commissioners argue that they too are entitled to quasi-judicial or qualified immunity, but that the claims against them also fail on the merits because they were not in any way involved in the licensing decision at issue. Plaintiff counters that neither immunity doctrine applies to shield the Commissioners from liability, and that because all of the Commissioners are involved in what Plaintiff views as an unconstitutional licensing procedure, they must all be held personally liable for their actions. The Court addresses each Motion below.

A. Standard of Review

Defendants argue dismissal of Plaintiffs claims is appropriate under Fed.R.Civ.P. 12(b), 12(c), and 56. With respect to the applicable standard of review, Plaintiff argues that the Court must confine its analysis to the Rule 56 standard of review because Defendant’s Motion relies in part on affidavits from both Hearing Commissioners in arguing for dismissal, which incorporate facts into the record that would be outside the proper scope of Rule 12(b)(6) and 12(c). As a practical matter, the standard of review will not materially impact the analysis, given that the parties agree on the facts germane to the Court’s Opinion. In an abundance of caution, however, the Court will treat Defendant’s Motion as a motion for summary judgment under Rule 56, so as to consider all evidence of record. Of course, Plaintiffs Motion for Summary Judgment implicates the same standard.

Summary judgment is appropriate when there are genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Jones v. Potter, 488 F.3d 397, 402 (6th Cir.2007); Fed. R.CrvP. 56. A genuine issue of material fact exists “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

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Bluebook (online)
870 F. Supp. 2d 477, 2012 U.S. Dist. LEXIS 90076, 2012 WL 2512935, Counsel Stack Legal Research, https://law.counselstack.com/opinion/flying-dog-brewery-lllp-v-michigan-liquor-control-commission-miwd-2012.