Diversified Numismatics, Inc. v. City of Orlando, Fla.

• Decision Date: 06 September 1990
• Docket Number: No. 89-357-CIV-ORL-18.,89-357-CIV-ORL-18.
• Court: U.S. District Court — Middle District of Florida
• Parties: DIVERSIFIED NUMISMATICS, INC., & Richard Eargle, Plaintiffs, v. CITY OF ORLANDO, FLORIDA, Bill Frederick, individually and as Mayor of Orlando, & Dan Wilson, individually and as Orlando Chief of Police, Defendants.

783 F. Supp. 1337

DIVERSIFIED NUMISMATICS, INC., & Richard Eargle, Plaintiffs, v. CITY OF ORLANDO, FLORIDA, Bill Frederick, individually and as Mayor of Orlando, & Dan Wilson, individually and as Orlando Chief of Police, Defendants.

No. 89-357-CIV-ORL-18.

United States District Court, M.D. Florida, Orlando Division.

September 6, 1990.

COPYRIGHT MATERIAL OMITTED

Gabe Kaimowitz, Winter Park, Fla., for plaintiffs.

Robert E. Bonner, Eubanks, Hilyard, Rumbley, Meier and Lengauer, P.A., Orlando, Fla., for defendants.

ORDER

G. KENDALL SHARP, District Judge.

Plaintiffs challenge the constitutionality of the Orlando precious metals ordinance, Orlando City Code §§ 43.54-.59 (Supp. 1989). Defendants have filed four motions for summary judgment, which plaintiffs have opposed. Based on a review of the ordinance, the case file, and the relevant law, the court grants all motions.

I. FACTS

Plaintiff Diversified Numismatics, Inc., is a Florida corporation that has its principal place of business in Orlando, Florida. It engages in the sale and purchase of numismatic coins as well as items that contain gold, silver, and other precious metals. Plaintiff Richard Eargle is an officer and employee of Diversified. In 1982, plaintiffs initiated a lawsuit alleging that the Orlando precious metals ordinance in effect at that time restricted their ability to sell and buy articles that contained precious metals. In Diversified Numismatics, Inc. v. City of Orlando, 615 F.Supp. 141 (M.D.Fla.1985), this court ruled that the ordinance was unconstitutionally vague, because it failed to specify any penalty for a violation, it failed to define clearly either a precious metal or a precious metal dealer, and it failed to specify the length of time a dealer had to maintain a register of sales or the times during the day when the police could inspect that register. Id. at 146-48. To cure the constitutional infirmities, the court suggested that the City modify its ordinance to conform with the Florida precious metals statute, Fla.Stat. §§ 538.01.021, repealed by Laws of 1989, ch. 89-533, (4). Id. at 149. In October 1985, the City changed its ordinance to reflect the language of the Florida statute.

In 1989, plaintiffs brought this lawsuit to challenge the amended ordinance. Along with suing the City of Orlando, plaintiffs are suing Mayor Bill Frederick because he took part in the promulgation and alleged enforcement of the amended ordinance.¹ Plaintiffs are also suing Police Chief Dan Wilson, because the police department is responsible for the alleged enforcement of the amended ordinance.

Despite the changes to the precious metals ordinance, plaintiffs claim the ordinance is still unconstitutionally vague and overbroad. Plaintiffs also claim defendants subjected them to "surreptitious investigation," "entrapment measures," "harassment," and "unwarranted intrusions ... into their ordinary business practices" in an attempt to enforce the ordinance. Consequently, plaintiffs allege that defendants have violated their fifth and fourteenth amendment rights to be free from an ordinance that does not state with specificity the parties and acts to be restrained, their fifth and fourteenth amendment rights to be free from unbridled police discretion in the enforcement of the ordinance, their fourth and fourteenth amendment rights to be free from warrantless searches, their fifth and fourteenth amendment rights to be free from having their property taken without just compensation, and their ninth amendment right to be free from invasions of privacy while operating a legitimate business. Because plaintiffs maintain that their rights have been deprived, they want this court to declare the amended ordinance unconstitutional, to enjoin defendants from enforcing it, and to award plaintiffs damages for the injuries they have suffered.

Defendants deny having participated in any illegal activity and assert that the amended ordinance is constitutional. In their motions for summary judgment, defendants contend that plaintiffs have not satisfied the constitutional "case or controversy" requirement, that plaintiffs have not stated a claim under 42 U.S.C. § 1983 (1988), that plaintiffs have not satisfied the notice requirements under Florida law to bring their pendent state claim for tortious interference with their business relationships, and that plaintiffs cannot receive punitive damages from defendants.

II. LEGAL DISCUSSION

A. Standard for Summary Judgment

Summary judgment is authorized if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). Summary judgment is appropriate only in circumstances where "the evidence is such that a reasonable jury could not return a verdict for the nonmoving party." Id. at 248, 106 S.Ct. at 2510; accord Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986).

The moving party bears the burden of proving that no genuine issue of material fact exists. See Anderson, 477 U.S. at 248-50, 106 S.Ct. at 2510-11; Celotex, 477 U.S. at 324-25, 106 S.Ct. at 2553. "The substantive law will identify which facts are material. Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Anderson, 477 U.S. at 248, 106 S.Ct. at 2510. In determining whether the moving party has satisfied its burden, all inferences drawn from the underlying facts are considered in a light most favorable to the party opposing the motion, and all reasonable doubts are resolved against the moving party. Id. at 255, 106 S.Ct. at 2513; see Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-88, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986).

As the United States Supreme Court has stated, "at the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 249, 106 S.Ct. at 2511. In order for a triable issue to surface, enough evidence must appear in favor of the non-moving party to cause a jury to return a verdict for that party. Id. at 249-50, 106 S.Ct. at 2511. Summary judgment is mandated "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.... The moving party is, therefore, `entitled to a judgment as a matter of law'...." Celotex, 477 U.S. at 322-23, 106 S.Ct. at 2552 (quoting Anderson, 477 U.S. at 250, 106 S.Ct. at 2511).

B. Justiciability and Standing

To show a "case or controversy," plaintiffs must demonstrate that they have personally "suffered some actual or threatened injury as a result of the putatively illegal conduct of the defendants." Gladstone, Realtors v. Village of Bellwood, 441 U.S. 91, 99, 99 S.Ct. 1601, 1608, 60 L.Ed.2d 66 (1979). "Abstract injury is not enough. It must be alleged that the plaintiff `has sustained or is immediately in danger of sustaining some direct injury' as a result of the challenged statute or official conduct." O'Shea v. Littleton, 414 U.S. 488, 494, 94 S.Ct. 669, 675, 38 L.Ed.2d 674 (1974) (quoting Massachusetts v. Mellon, 262 U.S. 447, 488, 43 S.Ct. 597, 601, 67 L.Ed. 1078 (1923)); accord Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 273, 61 S.Ct. 510, 512, 85 L.Ed. 826 (1941). "The injury or threat of injury must be both `real and immediate,' not `conjectural' or `hypothetical.'" O'Shea, 414 U.S. at 494, 94 S.Ct. at 675 (citations omitted). Plaintiffs must also show that the injury is traceable to defendants and "is likely to be redressed by a favorable decision." Simon v. Eastern Ky. Welfare Rights Org., 426 U.S. 26, 38, 96 S.Ct. 1917, 1924, 48 L.Ed.2d 450 (1976). The "case or controversy" requirement applies to actions brought under the Declaratory Judgment Act, 28 U.S.C. §§ 2201-2202 (1988). Steffel v. Thompson, 415 U.S. 452, 458, 94 S.Ct. 1209, 1215, 39 L.Ed.2d 505 (1974); Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240-41, 57 S.Ct. 461, 463-64, 81 L.Ed. 617 (1937). Under the Declaratory Judgment Act, plaintiffs may challenge the constitutionality of the amended ordinance before they have been exposed to actual arrest or prosecution. Steffel, 415 U.S. at 459, 94 S.Ct. at 1216.

1. Actual Injury.

Plaintiffs have shown some actual injury as a result of an alleged investigation of them by defendants. Plaintiff Richard Eargle claims that in 1989, Ronald Barnes, a local pawnbroker, told Steven Stilliker, a Diversified employee, that the Orlando Police Department was secretly investigating Diversified to determine whether it was violating the amended ordinance. Mr. Barnes told Mr. Stilliker that the police had fitted Steven Sidelinger with a hidden microphone and transmitter and then sent him into Diversified to gain information that the police could use to prove that Diversified was involved in illegal activity.

Mr. Eargle later confronted Mr. Sidelinger to confirm the validity of Mr. Barnes's story. Mr. Sidelinger, a regular seller of dental gold to Diversified, denied working with the police on the alleged undercover operation. But, Mr. Sidelinger thought his friend, Drew Hargraves, was impersonating him and could have been involved in the investigation of Diversified. As a consequence of the alleged undercover operation, Diversified claims to have lost business. Arletta Rogers, a Diversified employee, refused certain precious metal transactions for fear of being arrested, and Mr. Eargle has...