Harvey v. State

183 So. 3d 684, 2015 WL 9256676
CourtLouisiana Court of Appeal
DecidedDecember 16, 2015
DocketNos. 2014-C-0035, 2014-CA-0156, 2014-CA-9977, 2014-CA-0978, 2014-CA-0979
StatusPublished
Cited by12 cases

This text of 183 So. 3d 684 (Harvey v. State) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harvey v. State, 183 So. 3d 684, 2015 WL 9256676 (La. Ct. App. 2015).

Opinion

JOY COSSICH LOBRANO, Judge.

hln this case, the State of Louisiana, Department of Revenue, Office of Alcohol and Tobacco Control, and Troy Hebert, individually and in his capacity as Commissioner of the Office of Alcohol and Tobacco Control (hereinafter collectively “State”), appeal the following two judgments granting preliminary injunctions in favor of Robert G. Harvey, Sr. (“Harvey”), in his capacity as managing member/sole owner of Wagner’s Chef, L.L.C., Aberta, Inc. (d/ b/a Chicken Box Cafeteria & Market), and B-Xpress Elysian Fields, L.L.C.: (1) the December 30, 2013 judgment prohibiting the State from enforcing the State’s September 11, 2013 order suspending alcohol permits at Harvey’s three businesses (“First Injunction”); and (2) the June 20, 2014 amended judgment mandating the State to issue renewal alcohol, beer, and tobacco permits and licenses to Harvey’s three businesses (“Second Injunction”) and holding the State in contempt for violating the First Injunction.

These appeals have been consolidated with the State’s initial writ application, in which the State seeks review of the December 30, 2013 judgment overruling its exceptions of no cause of action, no right of action, and failure to join indispensable parties. In addition, because the instant contempt order does not|2impose sanctions or disciplinary action, it is an interlocutory ruling and not a final, appealable judgment; 1 thus, we have converted that portion of the second appeal challenging the contempt order to an application for supervisory writs.2

For the reasons which follow, we hold the following: (1) the judgments granting the First and Second Injunctions are reversed; (2) the State’s first writ is denied in part and granted in part, affirming the district court’s overruling of the exceptions of no right of action and failure to join indispensable parties and reversing the district court’s overruling of the exception of no cause of action; and (3) the State’s second (converted) writ is granted, reversing the district court’s contempt ruling against the State.

[690]*690 FACTUAL BACKGROUND

These consolidated matters stem from the revocation of alcohol permits at three New Orleans gas station/convenience stores: Chicken Box Cafeteria & Market,3 B-Xpress, and Wagner’s Chef. In June 2012, the State, through its Office of Alcohol and Tobacco Control (“ATC”), investigated a complaint that the Chicken Box store was being operated by Omar Ham-dan (“Mr, Hamdan”), who | ¡¡was not a registered owner and who had previously been convicted of a felony. As a convicted felon, Mr. Hamdan is disqualified from holding an alcohol permit under La R.S. 26:80(A)(5).4 '

State records reflect that the stores were'owned by FHH Properties, L.L.C., whose sole member was Fatmah Hamdan (“Mrs. Hamdan”), the spouse of Omar Hamdan. Louisiana Revised Statute 26:80(A)(11) disqualifies the spouse of a convicted felon, from holding an alcohol sales permit, and in Mrs. Hamdan’s application she denied having any spouse. Investigation by the State revealed that management and operation of the stores was carried out by Mr. Hamdan, and that Mr. and .Mrs. Hamdan were married, filed their taxes as a married couple, and that based upon their marriage Mrs. Hamdan had been able to get a United States visa as the spouse of a U.S. citizen. The investigation also revealed that the Wagner’s Chef and B-Xpress stores were also solely owned by Mrs. Hamdan, and suffered from the same deficiencies as Chicken Box— namely, they were owned by a disqualified spouse of a convicted felon. The ATC issued administrative citations to all three entities. In response, and notwithstanding her defense through counsel that because her marriage had taken place outside of the U.S. she was not married for purposes of U.S. and Louisiana law, on April 11, 2013 Mrs. Hamdan appeared with counsel before the ATC and agreed to sell all three businesses. The ATC ordered her to have no interest in any business with an alcohol permit.

| ¿Four days later, on April 15,2013, Mrs. Hamdan filed a petition for divorce. Also shortly following the appearance, Mrs. Hamdan sold the stores to her husband’s 'nephew, Fady Abusaud (“Mr. Abusaud”), who worked as a clerk at the store, under terms that left her'with a significant financial interest in the businesses. The Ham-dans’ attorney, plaintiff Harvey, loaned Mr. Abusaud $50,000.00 for the down payment on the businesses.

The ATC issued a second round of citations to the three businesses, and on May 31, 2013, held a second administrative hearing with Mr. Abusaud present. At that hearing, Mr. Abusaud could not discuss the financial situation of any of the three businesses, and testified that he did not have control, over the bank accounts, which were still in Mrs. Hamdan’s name. Concerned that Mr. Abusaud was not a bona fide owner, the ATC Commissioner ordered him to reten in five days with financial records confirming he was the true owner of the businesses, suspending the alcohol permits in the interim.

[691]*691Before the five days had elapsed, on June 4, 2013, Mrs. Hamdan re-sold the stores to the Hamdans’ attorney, plaintiff Harvey, in consideration for his offsetting a $500,000.00 debt they owed him for legal fees. On June 6, 2013, Harvey provided the ATC with documents required to transfer the applicable licenses to himself. On June 10, 2013, Harvey appeared before the ATC Commissioner and testified that he was the sole owner of the businesses, that the Hamdans had no further involvement with the businesses, and that Harvey was seeking an ethics opinion establishing that his purchase of the businesses was in good faith. Based on this, the ATC Commissioner reinstated the permits for all three businesses.

| ¿However, in July 2013, the ATC again investigated a complaint that Mrs. Ham-dan, a disqualified individual, continued to have an interest in Aberta, Inc., contrary to the 'ATC Commissioner’s prior order. It was then discovered that the Hamdans were continuing to run the Chicken Box, and that the purchase arrangement between Mrs. Hamdan and Harvey involved the creation of two classes of Aberta, Inc. stock: Class A, which purported to own real estate, and was owned 100% by Mrs. Hamdan; and Class B, which purported to own the Chicken Box store and its assets, including the alcohol permit, and which was owned 100% by Harvey. After this arrangement was deemed unacceptable to the ATC, at some point in July or August, Mrs. Hamdan sold 95% of her stock to Harvey, retaining a 5% ownership interest. Because this arrangement still gave Mrs. Hamdan a- financial stake, it was deemed non-compliant, and on August 23, 2013, a violation citation was issued to Aberta Inc., for “failure to maintain qualifications/spouse is- a convicted felon/permits revoked for 2 years.” The citation stated that an ATC administrative hearing on thé matter would be held on September 4, 2013.5 At Harvey’s request, the hearing date was later changed to September 10, 2013.6 At the hearing, which lasted nearly ten hours, Mrs. Hamdan testified that Mr. Hamdan,ran the businesses, and that while she testified that she had divorced Mr. Hamdan in an effort to retain the alcohol permits, she still lived in the same home and referred to him as her husband. Mr. Hamdan testified that he believes he still owns |fithe stores, and two former employees testified that Mr. Hamdan still ran the businesses.

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183 So. 3d 684, 2015 WL 9256676, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harvey-v-state-lactapp-2015.