Stepnes v. Ritschel

771 F. Supp. 2d 1019, 39 Media L. Rep. (BNA) 1429, 2011 U.S. Dist. LEXIS 3027, 2011 WL 97983
CourtDistrict Court, D. Minnesota
DecidedJanuary 12, 2011
DocketCivil 08-5296 ADM/JJK
StatusPublished
Cited by1 cases

This text of 771 F. Supp. 2d 1019 (Stepnes v. Ritschel) is published on Counsel Stack Legal Research, covering District Court, D. Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stepnes v. Ritschel, 771 F. Supp. 2d 1019, 39 Media L. Rep. (BNA) 1429, 2011 U.S. Dist. LEXIS 3027, 2011 WL 97983 (mnd 2011).

Opinion

*1025 MEMORANDUM OPINION AND ORDER

ANN D. MONTGOMERY, District Judge.

I. INTRODUCTION

On October 20, 2010, the undersigned United States District Judge heard oral argument on Plaintiff Paul C. Stepnes’ (“Stepnes”) Motion for Partial Summary Judgment [Docket No. 309], Defendants Peter Ritschel and City of Minneapolis’ (collectively, “City Defendants”) Motion for Summary Judgment [Docket No. 312], and Defendants CBS Broadcasting, Inc. and Esme Murphy’s (“Murphy”) (collectively, “CBS Defendants”) Motion for Summary Judgment [Docket No. 315]. For the reasons set forth below, the City Defendants and CBS Defendants’ motions are granted. Plaintiff Stepnes’s motion is denied.

II. BACKGROUND 1

In an effort to redeem a house he built called the “Irving House,” Stepnes, a real estate developer, devised a “home giveaway” contest. Shortly after the contest began in May 2008, Sergeant Peter Rit-schel (“Ritschel”) of the Minneapolis Police Department (“MPD”) arrested Stepnes for illegal gambling and searched the Irving House for evidence of an unlawful lottery. On July 15, 2008, the CBS Defendants aired a newscast that reported on the home giveaway contest and Stepnes’s arrest for gambling law violations.

Stepnes has advanced multiple claims against the City Defendants 2 under 42 U.S.C. § 1983 for failure to conduct a non-neutral investigation, false arrest, excessive force, illegal search and seizure, and conspiracy to violate Stepnes’s constitutional rights. Additionally, Stepnes has brought a defamation claim against the CBS Defendants, alleging that the broadcast included numerous defamatory statements and that the overall broadcast portrayed Stepnes as a criminal.

A. Irving House

Stepnes is a real estate developer who purchases, restores and resells homes. 1st Am. Compl. (“Compl.”) [Docket No. 2] ¶ 10; Sullivan Decl. [Docket No. 321] Ex. 1 (“Stepnes Dep.”) at 34-35. Stepnes built a “new old home,” equipped with modern amenities yet architecturally designed to blend with the older homes in the neighborhood, at 2857 Irving Avenue South in Minneapolis, Minnesota (the “Irving House”). Compl. at ¶ 10-11. Stepnes financed the Irving House through a number of loans. Compl. at ¶ 8; Sullivan Decl. Ex. 2 (“1st Stepnes Aff.”) ¶ 9. He attempted to sell the Irving House in 2005 for $2,250,000. 1st Stepnes Aff. ¶ 7. Stepnes declined a purchase offer of $1.8 million. Compl. ¶ 12. Ultimately, he was unable to sell the Irving House for its sought-after price, and the house went into foreclosure. Compl. ¶¶ 12-13; Sullivan Decl. Ex. 7 at 2.

B. Contest 1

In an effort to raise money to redeem the Irving House and pay creditors, Step-nes designed a “Big Dream House Giveaway” contest. Compl. ¶¶ 15, 18-25; Clark Decl. [Docket No. 327] Ex. 22. A website promoting the contest stated that a goal of the contest was to aid the homeless by paying off the mortgage of a shel *1026 ter for homeless women and children. Compl. ¶ 18; Clark Decl. Ex. 22.

The contest rules provided that contestants pay $20 for an opportunity to guess the number of nails, bolts, and screws (collectively, “fasteners”) contained in a large antique chest (“Contest 1”). Compl. ¶ 25; Moore Deck [Docket No. 324] Ex. 1 at 2. Stepnes sought to collect $5 million in entry fees. Compl. ¶ 26. The contestant guessing the closest number of items in the chest without going over would be the winner of the contest. Moore Deck Ex. 1 at 2. If over 250,000 entries were sold, the winner could choose either the Irving House or $1 million. Moore Deck, Ex. 1 at 7. If less than 250,000 entries were sold, the winner was entitled to 50% of “the balance of the funds left after paying all prizes, all contest expenses, and all expenses for the [Irving] House.” Id. Contest 1 also included weekly drawings “for an additional prize.” Id. at 1. If the contest did not result in sufficient income to redeem the Irving House by the redemption date, Stepnes alleges he had arranged for an anonymous benefactor to “to step in.” Compl. ¶ 15.

In April 2008, prior to launching Contest 1, Stepnes sought advice regarding state gambling regulations from Tom Barrett, the Executive Director of the Minnesota Gambling Control Board (“MGCB”). Compl. ¶ 22; Moore Deck Ex. 6 (“Stepnes Dep.”) at 249-52; Id. Ex. 11 (“Barrett Dep.”) at 70-72. At the meeting, Barrett explained to Stepnes that Minnesota law defines gambling as the presence of three elements: consideration, chance, and a prize. Compl. ¶ 22. Barrett advised Step-nes that “one way to remove the element of ‘chance’ was to host a game of skill.” Id. He told Stepnes that because a guessing contest requires analytical skill, the element of chance is removed from the contest. Barrett Dep. at 27-31. Barrett “gave the green light to the concept of having a container filled with nuts and bolts to be used as the determining factor” in the contest. Id. at 84-85. Stepnes did not request and did not receive a formal written opinion from Barrett. Compl. ¶ 22; Barrett Dep. at 84. Stepnes recalls informing Barrett that the contest would include a weekly drawing for a prize, but that no consideration would be required to enter the weekly drawing. Stepnes Dep. at 251-52. Bai-rett does not recall discussing a weekly drawing and remembers being surprised to learn after the meeting that Contest 1 included a drawing. Barrett Dep. at 32-33.

Stepnes implemented Contest 1 by borrowing an antique chest and filling it with different nuts, bolts, screws, nails, and other fasteners. Stepnes Dep. at 80-84. Before pouring the hardware into the chest, he placed a plastic drop cloth into the chest to protect it from damage. Stepnes Dep. at 85; Moore Deck Ex. 12 (“Kwiecien Dep.”) at 24-25. To stabilize and disburse its contents, Stepnes placed a cardboard box into the middle of the chest, underneath the plastic. Stepnes Dep. at 85-86; Kwiecien Dep. at 25. The cardboard box was larger than a shoe box and was partially filled with spools of nails. Stepnes Dep. at 85-86; Kwiecien Dep. at 25. Step-nes did not count the number of items he poured into the chest. Moore Supplemental Deck Ex. 4 (Clark Supplemental Aff.) at 1-2.

Stepnes promoted Contest 1 by: hiring a media consultant, purchasing advertising, seeking media coverage, hiring a website designer to create a website, posting a sign in the Irving House yard advertising Contest 1, and posting a sign on the door of the Irving House that stated:

$20 FEE GAINS YOU ENTRY INTO THE HOUSE AND CONTEST, YOU WILL BE AUTOMATICALLY REGIS *1027 TERED FOR OUR WEEKLY PRIZES.
YOUR PARTICIPATION WILL HELP FUND THE CHESTER-HOUSE FOUNDATION. OUR GOAL IS TO RAISE $1.5 MILLION TO HELP FUND ORGANIZATIONS THAT HELP HOMELESS PEOPLE. IF YOU WISH TO SEE THE HOUSE BEFORE PAYING THE ENTRY FEE, PEASE VISIT OUR WEBSITE 2857IRVING.COM RING BELL FOR ENTRY!

Sullivan Decl. Ex. 21; Moore Decl. Ex.

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771 F. Supp. 2d 1019, 39 Media L. Rep. (BNA) 1429, 2011 U.S. Dist. LEXIS 3027, 2011 WL 97983, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stepnes-v-ritschel-mnd-2011.