Steinhauser v. City of St. Paul

Decision Date18 December 2008
Docket NumberNo. 05-461 (JNE/SRN).,No. 04-2632 (JNE/SRN).,No. 05-1348 (JNE/SRN).,04-2632 (JNE/SRN).,05-461 (JNE/SRN).,05-1348 (JNE/SRN).
Citation595 F.Supp.2d 987
PartiesFrank J. STEINHAUSER, III, et al., Plaintiffs, v. CITY OF ST. PAUL et al., Defendants. Sandra Harrilal et al., Plaintiffs, v. City of St. Paul et al., Defendants. Thomas J. Gallagher et al., Plaintiffs, v. City of St. Paul et al., Defendants.
CourtU.S. District Court — District of Minnesota

John R. Shoemaker, Esq., Shoemaker & Shoemaker, PLLC, appeared for Plaintiffs Frank J. Steinhauser, III, Mark E. Meysembourg, Kelly G. Brisson, Sandra Harrilal, and Steven R. Johnson d/b/a Market Group and Properties.

Matthew A. Engel, Esq., Aase, Engel & Kirscher, PLLC, appeared for Plaintiffs Thomas J. Gallagher, Joseph J. Collins, Sr., Dadder's Properties, LLC, Dadder's Estates, LLC, Dadder's Enterprises, LLC, Dadder's Holdings, LLC, Troy Allison, Jeff Kubitschek, and Sara Kubitschek.

Plaintiffs Bee Vue and Lamena Vue did not appear.

Louise Toscano Seeba, Esq., St. Paul City Attorney's Office, appeared for Defendants City of St. Paul, Randy Kelly, Andy Dawkins, Lisa Martin, Steve Magner, Dean Koehnen, Michael Kalis, Dick Lippert, Kelly Booker, Jack Reardon, Paula Seeley, Mike Cassidy, Joel Essling, Steve Schiller, Joe Yannarelly, Dennis Senty, Michael Urmann, Rich Singerhouse, John Doe, Jane Doe, and Jane Roe.

ORDER

JOAN N. ERICKSEN, District Judge.

These three related cases are before the Court on Defendants' motions for summary judgment.1 The cases are unwieldy because each of the sixteen separate plaintiffs makes different factual allegations about his, her, or its treatment by some subset of the eighteen named defendants. The number of claims asserted by Plaintiffs compounds the unwieldiness of the cases. As foreshadowed by the previous two sentences, resolution of Plaintiffs' claims requires lengthy explanation.

Some commonalities exist between Plaintiffs. Plaintiffs are or were private owners of residential rental properties in the City of St. Paul (City). Plaintiffs rented the properties to low-income households. Plaintiffs, as landlords, received multiple code enforcement orders for conditions existing at their rental properties. In many cases, the code enforcement orders cited between ten and twenty-five violations for conditions including rodent infestation, missing dead-bolt locks, inadequate sanitation facilities, inadequate heat, inoperable smoke detectors, broken or missing doors and screens, and broken or missing guardrails and handrails. In some cases, Plaintiffs' properties were condemned as unfit for habitation.

Plaintiffs claim Defendants enforced the City's minimum residential property maintenance standards against them in a manner that violated state and federal law because Plaintiffs are "private landlords" and because they rented to protected classes. More specifically, Plaintiffs claim the City, former City Mayor Randy Kelly, the former Director of the City's Department of Neighborhood Housing and Property Improvement (DNHPI) Andy Dawkins, DNHPI supervisor Steve Magner, and other City employees violated Title VIII of the Civil Rights Act of 1968, as amended by the Fair Housing Act Amendments of 1988 (Fair Housing Act), 42 U.S.C. §§ 3601-3619 (2000); 42 U.S.C. §§ 1981, 1982, 1983, 1985 (2000); and the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961-1968 (2000), through their enforcement actions. Plaintiffs also make claims under Minnesota law for abuse of process, tortious interference with contract, and tortious interference with business expectancy. In addition, plaintiffs Thomas J. Gallagher, Joseph J. Collins, Troy Allison, Jeff and Sara Kubitschek, Dadder's Properties, LLC, Dadder's Estates, LLC, Dadder's Enterprises, LLC, and Dadder's Holdings, LLC (collectively, Gallagher plaintiffs) assert an antitrust claim under 15 U.S.C. §§ 1, 2, 13, 18 (2000), and claim that chapters 34, 43, 45, and 51 of the St. Paul Legislative Code are unconstitutionally vague. For the reasons set forth below, the Court grants Defendants' motions for summary judgment and dismisses all three cases.2

I. BACKGROUND
A. City of St. Paul Housing Code and Enforcement

Chapter 34 of the St. Paul Legislative Code (housing code) sets forth the minimum property maintenance standards for all structures occupied or intended to be occupied for residential purposes in the City. St. Paul, Minn., Code §§ 34.01, 34.03 (1993). The stated purpose of the housing code is to "protect the public health, safety and welfare in all structures and on all premises." Id. § 34.01. It "[e]stablishes minimum maintenance standards for all structures and premises for basic equipment and facilities for light, ventilation, heating and sanitation; for safety from fire; for crime prevention; for space, use and location; and for safe and sanitary maintenance of all structures and premises." Id.

In 2003, the City established DNHPI as an executive department responsible for administering and enforcing the housing code. Id. § 14A.01 (repealed 2008). Randy Kelly, who was the City Mayor at the time, appointed Andy Dawkins as the director of DNHPI. The responsibilities of DNHPI included inspecting all buildings and properties as required by the City codes; administering and enforcing laws regulating the maintenance of residential property, including the City's vacant building program and the City's rental registration program; and enforcing violations of the City's codes related to property maintenance. Id. § 14A.01(b). According to the DNHPI website, DNHPI's mission was to "keep the city clean, keep its housing habitable, and make [its] neighborhoods the safest and most livable [of] anywhere in Minnesota." The DNHPI website identified closing down "problem properties" as one of DNHPI's priorities. The DNHPI website described a "problem property" as "[i]f you live next door to a problem property[,] you know it! Constant calls to get rid of the junk, intolerable behavior by occupants, and guests, etc." Problem properties included both rental and owner-occupied properties.

During Dawkins's tenure as director, DNHPI enforced the housing code by conducting proactive sweeps requested by City District Councils and responding to citizen complaints. According to the DNHPI website, to respond to a citizen complaint, a housing inspector visited the subject property and determined if a violation existed. If the complaint was founded, DNHPI mailed a correction or an abatement order to the occupant and the property owner.

Dawkins created written rules and procedures for DNHPI, which were publicly available from the DNHPI website. These rules stated that DNHPI's goal was consistent application of the rules, but noted that "universal application of the housing code" was not possible due to DNHPI's limited resources. Housing inspectors therefore had discretion in their application of the rules, in their prioritization of cases, to determine which problems received the closest scrutiny, and to achieve compliance through a conversation with the property owner rather than issuing a work order or misdemeanor tag. To aid housing inspectors in exercising their discretion, the rules established the following priorities: serious health and safety cases, problem properties, garbage and nuisance violations, falling down/dilapidated structures, interior habitability cases, and structures with multiple violations.

Enforcement tools available to housing inspectors included orders to correct or abate conditions, condemnation and vacant building registration, criminal charges, and fees for excessive consumption of City services. In addition, rental properties were subject to revocation of rental registration, evictions initiated by the City Attorney, and City-initiated Tenant Remedies Actions pursuant to Minn.Stat. § 504B.395, subd. 1(4) (2006). At times, properties not in compliance with the housing code were required to undergo a "code compliance" inspection by the City's Office of License, Inspections, and Environmental Protection, which would evaluate the building's structure, plumbing, electrical condition, and mechanical condition.

B. St. Paul Public Housing Agency

The St. Paul Public Housing Agency (PHA), a governmental entity separate and distinct from the City, owns and manages 4300 units of public housing in the City. The United States Department of Housing and Urban Development (HUD) funds PHA's public housing program through an operating subsidy and capital improvement funds. PHA's public housing includes high-rise properties, family townhome developments, and 450 "scattered site" properties, which are single family or duplex properties located throughout the City. Plaintiffs claim these scattered site properties are similar to their rental properties. According to PHA documents, the scattered site properties' tenant base is about 32% African-American and 58% Asian/Pacific Islander.

PHA also operates the Section 8/Housing Choice Voucher program (HCV program) for the City. HUD funds the HCV program. PHA pays HCV program funds directly to landlords on behalf of households participating in the HCV program.

According to Jon Gutzmann, Executive Director of PHA, there is a shortage of affordable housing in the City. About 6000 households are on the waiting list for PHA public housing. Approximately 3000 households are on the HCV program's waiting list, which is closed. Although the record does not reflect the demographic breakdown for the City, it is undisputed that non-whites make up a disproportionate percentage of these waiting lists.

PHA properties are subject to the federal Uniform Physical Condition Standard (UPCS). Properties owned by PHA also are subject to the City's codes, including the housing code. According to Henry Petro, Director of Maintenance for PHA, the City sends code enforcement orders to a single contact person at...

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    ...lived there, and plaintiff's "ownership alone d[id] not create a reasonable expectation of privacy"); Steinhauser v. City of St. Paul, 595 F.Supp.2d 987, 1006-07 (D.Minn.2008) (landlords did not have reasonable expectation of privacy in their tenants' apartments, and therefore lacked standi......
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