RCI Entm't (San Antonio), Inc. v. City of San Antonio

• Decision Date: 08 April 2021
• Docket Number: Case No. SA-21-CV-0194-JKP
• Parties: RCI ENTERTAINMENT (SAN ANTONIO), INC., d/b/a XTC CABARET, Plaintiff, v. THE CITY OF SAN ANTONIO, et al., Defendants.
• Court: U.S. District Court — Western District of Texas

RCI ENTERTAINMENT (SAN ANTONIO), INC.,d/b/a XTC CABARET, Plaintiff, v. THE CITY OF SAN ANTONIO, et al., Defendants.

Case No. SA-21-CV-0194-JKP

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION

April 8, 2021

THIRD ORDER DENYING INJUNCTIVE RELIEF

Before the Court is Plaintiff's Application for Temporary Restraining Order (ECF No. 29). The City of San Antonio has filed a response (ECF No. 32) and the Court has held a hearing on the motion. The motion is ripe for ruling. After considering the motion, briefing, and applicable law, the Court denies the motion.

The Federal Rules of Civil Procedure specifically govern preliminary injunctions and temporary restraining orders. See Fed. R. Civ. P. 65. Plaintiff seeks a temporary restraining order ("TRO") against defendants. Because the City has responded and the Court has conducted a hearing on the matter, the Court considers the motion to be one for preliminary injunction.

"A preliminary injunction is an extraordinary remedy and should only be granted if the [movant has] clearly carried the burden of persuasion on all four requirements." Nichols v. Alcatel USA, Inc., 532 F.3d 364, 372 (5th Cir. 2008) (internal quotation marks omitted). Granting such "injunction is to be treated as the exception rather than the rule." Healthpoint, Ltd. v. Stratus Pharm., Inc., 273 F. Supp. 2d 769, 777 (W.D. Tex. 2001). Courts do not award such an extraordinary remedy "as of right." Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 24 (2008).

To obtain a preliminary injunction or TRO, the movant must demonstrate the following equitable factors: "(1) a substantial likelihood of success on the merits, (2) a substantial threat of irreparable injury if the injunction is not issued, (3) the threatened injury if the injunction is denied outweighs any harm that will result if the injunction is granted, and (4) the grant of the injunction will not disserve the public interest." Janvey v. Alguire, 647 F.3d 585, 595 (5th Cir. 2011) (citing Byrum v. Landreth, 566 F.3d 442, 445 (5th Cir. 2009)); accord Jackson Women's Health Org. v. Currier, 760 F.3d 448, 452 (5th Cir. 2014). Stated differently, a movant "seeking a preliminary injunction must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest." Winter, 555 U.S. at 20. And for purposes of issuing a preliminary injunction, the irreparable injury must occur "during the pendency of the litigation." Justin Indus., Inc. v. Choctaw Secs., L.P., 920 F.2d 262, 268 n.7 (5th Cir. 1990).

Each case requires the courts to "balance the competing claims of injury and . . . consider the effect on each party of the granting or withholding of the requested relief." Winter, 555 U.S. at 24 (citation omitted). Whether to grant or deny a preliminary injunction lies within the sound discretion of the district courts. Weinberger v. Romero-Barcelo, 456 U.S. 305, 320 (1982). And when, "exercising their sound discretion, courts of equity should pay particular regard for the public consequences in employing the extraordinary remedy of injunction." Winter, 555 U.S. at 24 (citation omitted).

"The purpose of a preliminary injunction [(or TRO)] is merely to preserve the relative positions of the parties until a trial on the merits can be held." Univ. of Tex. v. Camenisch, 451 U.S. 390, 395 (1981). But as the Fifth Circuit long ago cautioned, "[i]t must not be thought, however, that there is any particular magic in the phrase 'status quo,'" because "[t]he purpose of a prelim-inary injunction is always to prevent irreparable injury so as to preserve the court's ability to render a meaningful decision on the merits." Canal Auth. of the State of Fla. v. Callaway, 489 F.2d 567, 576 (5th Cir.1974). Courts recognize two types of injunctions, mandatory and prohibitory. See, e.g., Meghrig v. KFC W., Inc., 516 U.S. 479, 484 (1996) (recognizing mandatory and prohibitory injunctions); In re Bahadur, 441 F. Supp. 3d 467, 473 (W.D. Tex. 2020) (same).

It is well settled that the issuance of a prohibitory injunction freezes the status quo, and is intended "to preserve the relative positions of the parties until a trial on the merits can be held." Preliminary injunctions commonly favor the status quo and seek to maintain things in their initial condition so far as possible until after a full hearing permits final relief to be fashioned.

Wenner v. Tex. Lottery Comm'n, 123 F.3d 321, 326 (5th Cir. 1997) (quoting Camenisch, 451 U.S. at 395); accord Meghrig, 516 U.S. at 484 (defining a prohibitory injunction as "one that 'restrains'" action). A mandatory injunction, on the other hand, "compels defendants to promptly and affirmatively act in a specific and extremely extensive manner." U.S. v. Texas, 601 F.3d 354, 362 (5th Cir. 2010); accord Meghrig, 516 U.S. at 484 (defining a mandatory injunction as "one that orders a responsible party to 'take action'"). These injunctions are labeled as mandatory because they mandate rather than enjoin action.

Although courts may appropriately issue a mandatory injunction when "the currently existing status quo is causing a party to suffer irreparable injury," Canal Auth., 489 F.2d at 576, "[m]andatory preliminary relief, which goes well beyond simply maintaining the status quo pendente lite, is particularly disfavored, and should not be issued unless the facts and law clearly favor the moving party," Martinez v. Mathews, 544 F.2d 1233, 1243 (5th Cir. 1976); accord Exhibitors Poster Exch., Inc. v. Nat'l Screen Serv. Corp., 441 F.2d 560, 561 (5th Cir. 1971) (per curiam) (describing the exception as "rare instances in which the facts and law are clearly in favor of the moving party").

The instant motion concerns events that occurred on April 3 and 4, 2021. Shortly after 9:00p.m. on Saturday, April 3, 2021, multiple officers from the San Antonio Police Department arrived at Plaintiff's establishment to execute a search warrant. The warrant expressly incorporates a supporting affidavit and directs officers

to enter and search said location for the following items found therein, including, but not limited to . . . [a]ny devices on, in, or around the property which provides power, electricity, water, or any type of elements of comfort which would allow a person or persons to occupy a place, use the place in any manner, or allow a place to be used for a business . . .. Also to be searched are papers, currency, schedules, or electronic devices which allow for any type of business transaction to occur, further the business of a location or record transactions of a business. Any electronic devices used for entertainment of the patrons, employees, or any person or which also furthers the business of the location or it's employees such as speakers, DJ equipment, lights, etc.

Ex. E (attached to Application). The City has provided the affidavit, which sets out probable cause for the search warrant based upon an alleged Certificate of Occupancy Violation in violation of Section 10-12 of the City Ordinance Code 2018-06-21-0493. See Ex. B (attached to Resp.). According to a Receipt for Property, the officers seized a water pump, employee records and miscellaneous paperwork, and more than $48,000 in cash. Ex. D (attached to Application). Officers also had a third-party generator removed from the premises and arrested a club manager, Giselle Hernandez.

Plaintiff seeks a five-pronged TRO. It seeks to (1) enjoin Defendants from prosecuting Ms. Hernandez on the issued citation; (2) enjoin Defendants from arresting or detaining any employee or representative of Plaintiff for operating; (3) require Defendants to return all seized property; (4) requiring Defendants to notify Plaintiff of the whereabouts of the third-party electricity generator and if impounded, secure its release; and (5) required Defendants to notify any third party involved in the removal of the generator of any issued temporary restraining order. Much of the requested injunctive relief goes beyond merely maintaining the status quo by seeking compel defendants to take certain action.

At the outset, the Court notes that the injunctive relief currently sought goes well beyond anything at issue in the original complaint filed on March 2, 2021. See Compl. (ECF No. 1) (seeking relief from unlawful revocation of Plaintiff's Certificate of Occupancy). To properly present these issues to the Court requires the filing of an amended or supplemental pleading. See Fed. R. Civ. P. 15(a) and (d). A party has no substantial likelihood of success for claims not properly before the Court.

Plaintiff, furthermore, merely states that it "has valid causes of actions against Defendants and a probable right to the relief sought." It provides little insight into the precise claims raised by the recent events but asserts that Defendants acted without legal basis under the color of law enforcement. However, that assertion is based on an erroneous view of the law. First, Plaintiff does not take into consideration that Texas defines "search warrant" as "a written order, issued by a magistrate and directed to a peace officer, commanding him to search for any property or thing and to seize the same and bring it before such magistrate." Tex. Code Crim. Proc. art. 18.01(a). Thus, based on the issued search warrant, the officers had probable cause to search for and seize property identified in the warrant.

Second, subject to an exemption under Subsection 10-6(d) that is inapplicable on the facts, Subsection 10-12(a) of the City Ordinance Code requires issuance of a certificate of occupancy before anyone may use or occupy any building or structure. Relying on Subsection 10-15(e) of the City Ordinance Code, Plaintiff takes the position that non-compliance with the certificate-of-occupancy requirement merely subjects violators to a $500 fine. Section...