Johnson v. City of Saginaw

• Decision Date: 13 November 2020
• Docket Number: No. 19-1208,19-1208
• Citation: 980 F.3d 497
• Parties: Rita R. JOHNSON, Plaintiff-Appellee, v. CITY OF SAGINAW, MICHIGAN, Defendant, Jason Cabello; John Stemple, Defendants-Appellants
• Court: U.S. Court of Appeals — Sixth Circuit

980 F.3d 497

Rita R. JOHNSON, Plaintiff-Appellee,

v. CITY OF SAGINAW, MICHIGAN, Defendant,Jason Cabello; John Stemple, Defendants-Appellants,

No. 19-1208

United States Court of Appeals, Sixth Circuit.

Decided and Filed: November 13, 2020

HELENE N. WHITE, Circuit Judge.

In the early hours of Saturday, May 6, 2017, a gunfight broke out in front of Plaintiff-Appellee Rita Johnson's restaurant in Saginaw, Michigan. At the time, Johnson was renting out the space for a large birthday party. An initial police investigation concluded that a gang-related fight began inside Johnson's building and then moved into the street. Later that day, Defendant-Appellant John Stemple directed Defendant-Appellant Jason Cabello to suspend water service to Johnson's building in an effort to prevent her from hosting further events. Johnson later filed this lawsuit, alleging Defendants violated her procedural and substantive due process rights by shutting off her water without notice and a hearing and without a rational basis. The parties filed cross-motions for summary judgment. The district court denied qualified immunity to Cabello and Stemple and granted Johnson's summary judgment motion as to them.¹ Cabello and Stemple appeal. We affirm in part, reverse in part, and remand for further proceedings.

I. Background

Johnson owned and operated a restaurant in Saginaw called Rita's Southern Soul Café (the Café). Johnson also owned the building. She rented out the restaurant to organizations and individuals for various events, including birthday parties, wedding receptions, baby showers, fashion shows, dance classes, charitable events, and holiday gatherings.

Johnson rented the Café for the night of Friday, May 5, 2017, to Andrick Pruitt for his birthday party. Pruitt invited a rapper to perform at the event and hired a security company. By one account, 400 people attended, although Johnson stated the building's capacity was 315 and claimed 400 people could not fit in the space. Around 1:30 AM, Johnson was in the kitchen cooking when she saw the guests running, ducking, and hiding. According to Johnson, she was told that someone across the street was shooting at her building. In her declaration, Johnson stated that the shooters were not connected to her and she did not believe them to be connected to the event that night. Johnson had another party scheduled for Saturday night but canceled it due to the damage from the shooting.

On Saturday, May 6, City officials suspended Johnson's water service. John Stemple, who served as the chief inspector for the City, made the decision to shut off the water without consulting any other City employee. Stemple reached this decision after receiving information about the shooting from the Saginaw Police Department. According to Stemple, during the party at the Café, there was a "confrontation that occurred between par[t]ies, which moved out into the street. And there was significant gunfire that happened in the middle of Washington Avenue." R. 74-4, PID 1345. Stemple "considered that an emergency situation" and decided to discontinue water service "to protect the health, safety and welfare of the citizens of Saginaw" and "to deter any further activity of that type from occurring until such time that a hearing and investigation [could] occur." Id. at PID 1344-45. Stemple relied on Michigan Building Code 112.3 and the City's adoption of that code for his authority to shut off the water to the Café.

Through local ordinance, the City opted to be a local enforcing agency of the Michigan Building Code. That code states in relevant part:

The building official shall have the authority to authorize disconnection of utility service to the building, structure or system regulated by this code and the referenced codes and standards set forth in Section 101.4 in case of emergency where necessary to eliminate an immediate hazard to life or property or when such utility connection has been made without the approval required by Section 112.1 or 112.2. The building official shall notify the serving utility, and wherever possible the owner and occupant of the building, structure, or service system of the decision to disconnect prior to taking such action. If not notified prior to disconnecting, the owner or occupant of the building, structure or service system shall be notified in writing, as soon as practical thereafter.

Mich. Building Code § 112.3.

Joseph Gough served as the City's utility foreman. Gough testified that he received a call from Stemple requesting that he turn off the water to the building in response to a shooting. Gough then directed Cabello, a utility inspector for the City, to complete the shut off. Cabello did not know why Gough directed him to turn off the water. According to Cabello, he was told, " ‘Inspections wants this water turned off,’ and that's it." R. 74-6, PID 1407. Cabello shut off the water around 7:30 PM. Cabello was never advised by the City that there had been no hearing or that notice or hearing were required before shutting off water to a building.

Although Stemple acknowledged that he did not provide Johnson with a notice regarding her water before or after the shutoff, he testified that the City provided Johnson "an opportunity for a hearing related to the closure or suspension of her business activities ... within five days, as required by the ordinance." R. 74-4, PID 1346. Stemple testified that he did not receive training or education regarding his "constitutional obligations as to potable water delivery as a property right, as a constitutional right." Id. He also stated that he has shut off water to other businesses in response to shootings in the past. In each instance, Stemple did not provide pre-deprivation notice and, he stated, the "[p]ractice and policy has been consistent throughout." Id. at 1348-49. In Stemple's view, "the notice of the suspension of the business license covers [water shutoffs] even though it doesn't mention it within the body of the document." Id. at PID 1349.

Johnson received a notice on her door regarding the suspension of her business. The notice did not mention the water shutoff. The notice, signed by City Manager Timothy Morales and dated May 8, 2017, stated in part:

PLEASE BE ADVISED THAT PURSUANT TO THE CITY OF SAGINAW ("CITY") CODE OF ORDINANCE, ALL ACTIVITY RELATED TO THE USE AND/OR OPERATION OF THE PROPERTY LOCATED AT 110 N. WASHINGTON AVENUE, SAGINAW, MI 48601, ALSO KNOWN AS "RITA'S SOUTHERN SOUL CAFE" ("ESTABLISHMENT")

IS HEREBY SUSPENDED, EFFECTIVE MAY 8, 2017 .

THE IMMEDIATE SUSPENSION OF BUSINESS ACTIVITY HAS BEEN ISSUED PURSUANT TO ORDINANCE 0-1, § 110.06(F), WHICH PROVIDES THAT THE CITY MANAGER MAY IMMEDIATELY SUSPEND ANY LICENSE OR PERMIT ISSUED BY THE CITY OF SAGINAW UPON A DETERMINATION THAT SUCH A SUSPENSION IS NECESSARY "IN THE INTEREST OF THE PUBLIC HEALTH, MORALS, SAFETY, OR WELFARE."

R. 74-8, PID 1429-30. The notice further advised that a hearing would be held on May 11, 2017. At that hearing, the hearing officer explained, "It is my understanding that this show-cause administrative hearing ... is in regard to ... a notice for the immediate suspension of the business activity of Rita's Southern Soul Café." R. 74-3, PID 1317.

The City's police chief, Robert Ruth, testified that he first met Johnson around 2015, when another party hosted at the Café ended in a similar shooting: "[I]t ended up being a lot of gang members from Saginaw were there at the party, ended up spilling out into the front street, there was a huge fight, and then guns were pulled and there were shots being fired up and down Washington Avenue." Id. at PID 1334. Ruth also testified about the ongoing investigation into the shooting at issue:

The investigation shows that there was a fight inside of Rita's. The security, which was very heavily armed, broke the fight up and pushed everybody outside. The people that were fighting went to their vehicles, retrieved guns, and started shooting back and forth at each other. One of the security guards, the one that was—that had an AK-47 style rifle strapped around his neck, pulled the gun up outside of Rita's and fired off five or six shots into the air. That scared everybody enough to run and go in their own direction. And the shooting stopped at that point.

Id. at PID 1335. Sixty shell casings were found in the area, at least one of which was found in the doorway of the Café. Ruth further testified that the investigation showed the incident was gang related. The water-service suspension came up only once during the hearing, when Johnson stated, "My water's off. I don't know why. Maybe somebody here can tell me. I have no idea. I go into my building, my water bill's paid, but the water's off. So I don't know if that's the way of helping to shut me down." Id. at PID 1340.

In her deposition, Johnson testified that after her water was turned off, she had issues with the toilets, which "became heavily stained" due to the lack of water for flushing and cleaning. R. 74-2, PID 1307. Johnson also had a pest-control service spray for "sewer flies" which the service advised would come up through the drains due to the lack of water. Id. A plumber quoted Johnson $6,000 for repairs. Johnson testified that she continued to make water-bill payments although she was not receiving service. And because her business license was revoked and her water service was discontinued, Johnson had to turn away potential renters. She estimated that she incurred over $80,000 in lost revenue.

Johnson testified that she went to the billing department "about twice" to request that her water service be restored but a representative told her no information regarding the shutoff could be provided. Id. at PID 1312. Stemple testified that he did not have knowledge of these visits. The water to the building was turned back on in October of 2017 in response to the request of Johnson's attorney. When asked how he decided to turn the water on, Stemple responded, "[T]he owner...