Toussie v. Cnty. of Suffolk

• Citation: 806 F.Supp.2d 558
• Decision Date: 02 August 2011
• Docket Number: Nos. 01–CV–6716 (JS)(ARL),05–CV–1814 (JS)(ARL).,s. 01–CV–6716 (JS)(ARL)
• Parties: Robert I. TOUSSIE and Chandler Property, Inc., Plaintiffs, v. COUNTY OF SUFFOLK, Robert J. Gaffney, individually, and in his official capacity as Suffolk County Executive, Allen Grecco, and Peerless Abstract Corp., Defendants.Robert I. Toussie, Laura Toussie, Elizabeth Toussie, Michael I. Toussie, Prand Corp. f/k/a Chandler Property, Inc., Arthur A. Arnstein Corp., Toussie Land Acquisition & Sales Corp., and Toussie Development Corp., Plaintiffs, v. County of Suffolk, Paul Sabatino, II, Patricia B. Sielinski and Thomas A. Isles, Defendants.
• Court: U.S. District Court — Eastern District of New York

806 F.Supp.2d 558

Robert I. TOUSSIE and Chandler Property, Inc., Plaintiffs,
v.
COUNTY OF SUFFOLK, Robert J. Gaffney, individually, and in his official capacity as Suffolk County Executive, Allen Grecco, and Peerless Abstract Corp., Defendants.Robert I. Toussie, Laura Toussie, Elizabeth Toussie, Michael I. Toussie, Prand Corp. f/k/a Chandler Property, Inc., Arthur A. Arnstein Corp., Toussie Land Acquisition & Sales Corp., and Toussie Development Corp., Plaintiffs,
v.
County of Suffolk, Paul Sabatino, II, Patricia B. Sielinski and Thomas A. Isles, Defendants.

Nos. 01–CV–6716 (JS)(ARL)

05–CV–1814 (JS)(ARL).

United States District Court, E.D. New York.

Aug. 2, 2011.

[806 F.Supp.2d 567]

Abbe David Lowell, Esq., Chadbourne & Parke, LLP, Washington, DC, Scott S. Balber, Esq., Emily Abrahams, Esq., Jeffrey Carson Pulley, Esq., Chadbourne & Parke LLP, New York, NY, for Plaintiffs.

Arlene S. Zwilling, Esq., John Richard Petrowski, Esq., Chris P. Termini, Esq., William G. Holst, Esq., Suffolk County Attorney's Office, Hauppauge, NY, for Defendants, County of Suffolk; Robert J. Gaffney, Individually and in his official capacity as Suffolk County Executive; Patricia B. Sielinski; and Thomas A. Isles.

Anton J. Borovina, Esq., Law Office of Anton J. Borovina, Melville, NY, for Defendant Paul Sabatino, II.MEMORANDUM & ORDER SEYBERT, District Judge:

Plaintiffs, Robert I Toussie (“Toussie”) and Chandler Property, Inc., began this action (01–CV–6716) in October 2001, asserting that their civil rights had been violated when the Defendants, Suffolk County and Robert J. Gaffney (“Gaffney”), denied them the opportunity to purchase thirty-one parcels of real estate at the 2001 Suffolk County Surplus Auction. (2001 Am. Compl. [Doc. No. 45].) In April 2005, those plaintiffs, joined by Laura Toussie, Elizabeth Toussie, Michael I. Toussie, Prand Corp. f/k/a Chandler Property, Inc., Arthur A. Arnstein Corp., Toussie Land Acquisition and Sales Corp., and Toussie Development Corp. (collectively “Plaintiffs” or “Toussies”), commenced a second action (05–CV–1814) asserting similar claims under 42 U.S.C. § 1983. (2005 Compl. [Doc. No. 1].) The 2005 Complaint alleged that the Defendants, Suffolk County, Paul Sabatino, II (“Sabatino”), Patricia B. Zielinski (“Zielinski”) ¹, and Thomas A. Isles (“Isles”), violated Plaintiffs' civil rights when they blocked the sale of sixteen parcels in 2002 and barred Plaintiffs' attendance from public auctions in 2004. As they had in the 2001 Amended Complaint, Plaintiffs also asserted several state law claims including, among other things, breach of contract, unjust enrichment, and defamation. On May 18, 2007, the Court consolidated the 2001 and 2005 actions in the interest of judicial economy. [Doc. No. 182]. Pending before the Court is Defendants' motion for summary judgment. For the following reasons, Defendants' motion is GRANTED IN PART and DENIED IN PART.

[806 F.Supp.2d 568]

BACKGROUND ²

Defendant Suffolk County (“Suffolk County” or “the County”) regularly auctions real property that it has acquired as a result of non-payment of real estate taxes. (Pls.' 56.1 Stmt. ¶ 6.) The terms and conditions governing the auctions are set forth in an auction booklet, which is passed as legislation pursuant to County law and distributed in advance of the auction. ( Id. ¶ 32; Pls.' 56.1 Supp. ¶ 36; Defs.' 56.1 Stmt. ¶ 3.)

The County held an auction on May 23–24, 2001 ³ (“2001 Auction”), where Plaintiff Toussie was the highest bidder on four parcels, and Plaintiff Chandler Property, Inc. was the highest bidder on twenty-seven parcels. (Pls.' 56.1 Stmt. ¶¶ 5, 12.) Pursuant to the terms and conditions of the 2001 Auction, Plaintiffs entered into memoranda of sale for each parcel and tendered the required 20% down payment and auction fee for each of the thirty-one properties. (Pls.' 56.1 Stmt. ¶ 5.) All auction sales, however, were conditioned upon approval by the Suffolk County Legislature (“Legislature”). (Defs.' 56.1 Stmt. ¶ 4.) ⁴ The Legislature's discretion to approve or disapprove the sales was not limited in the auction booklet, the Suffolk County Administrative Code, or Terms and Conditions of Sale.

The Legislature's approval of the sales was sought on an expedited basis, ⁵ meaning that the resolution would be submitted to the full Legislature, rather than to the Ways & Means Committee (“Committee”) for initial approval. ( Id. ¶ 12.) On recommendation of Defendant Sabatino, counsel to the Legislature, the resolution approving the 2001 Auction sales was split into two bills: Introductory Resolution 1676–01 (“IR 1676–01”), which proposed authorization of the sale of parcels to Plaintiffs, and Introductory Resolution 1675–01 (“IR 1675–01”), which proposed authorization for the sale of parcels to all other buyers. (Defs.' 56.1 Stmt. ¶ 13.) The County had never before split auction sales into two separate resolutions.

IR 1675–01 was expedited and submitted to the full Legislature on June 26, 2001; it was approved by a vote of 17–1. IR 1676–01, on the other hand, was submitted to the Committee on July 30, 2001 and was tabled.⁶ On August 7, 2001, the

[806 F.Supp.2d 569]

full Legislature considered a motion to discharge IR 1676–01 from Committee. Present were members of the community who objected to the properties ever being sold to Toussie or any company affiliated with him. The motion was defeated. (Pls.' 56.1 Stmt. ¶ 17; Defs.' 56.1 Stmt. ¶ 17.) The Committee again considered IR 1676–01 on August 20, 2001 and this time unanimously defeated it. Counsel for Toussie as well as members of the community again appeared to testify regarding the sale. (Defs.' 56.1 Stmt. ¶¶ 18–20.) In response to complaints from community-members, Toussie's attorney stated that Toussie would agree that neither he nor his son would develop the property. (Pls.' 56.1 Supp. ¶ 16; Pls.' 56.1 Stmt. ¶ 19.) Despite these assurances, on August 28, 2001, after again hearing testimony from community members in opposition to the sales, the Legislature affirmed the Committee's action. (Pls.' 56.1 Stmt. ¶ 21; Defs.' 56.1 Stmt. ¶ 21.) Plaintiffs allege that the Legislature had no legitimate reason for defeating IR 1676–01, but did so to pander to their constituents for political gain. (Pls.' 56.1 Stmt. ¶ 25.) Defendants assert that the County's decision was based on their legitimate concerns regarding Toussie's business practices.⁷ On October 11, 2001, Toussie and Chandler Property, Inc. commenced one of the two actions consolidated herein challenging the Legislature's failure to approve these sales.

On March 18, 2002, Toussie wrote a letter to the County asking “that the County advise [him] as soon as possible if it intend[ed] to prohibit [him] from purchasing property at the May 2002 Auction.” (Pls.' 56.1 Supp. ¶ 21.) The County responded stating that “the failure of the Suffolk County Legislature to approve the conditional sales for the May 2001 auction, did not include a directive barring him from future actions,” but also cautioning that “participation does not carry with it a guarantee of success” because “sales are conditioned upon the discretionary approval of the Suffolk County Legislature.” (Pls.' 56.1 Stmt. Ex. 47.)

The County held another auction on May 15–16, 2002 (“2002 Auction”). The auction booklet and Terms and Conditions of Sale were identical to those in the 2001 Auction. Toussie, his company, Prand Corp., his wife, Laura Toussie, her company, Arthur A. Arnstein Corp., his daughter, Elizabeth Toussie, his brother, Michael Toussie, and companies bearing the Toussie name but not owned or operated by the family, Toussie Land Acquisition & Sales Corp. and Toussie Development Corp. were the winning bidders on sixteen properties. (Pls.' 56.1 Stmt. ¶ 33.) They again signed memoranda of sale and tendered the required 20% down payment and

[806 F.Supp.2d 570]

auction fee for each of the sixteen properties. ( Id.)

On June 11, 2002, IR 1730–2002, which proposed the approval of the sale of parcels to the high bidders at the 2002 Auction, was presented to the Legislature. The resolution was assigned to the Committee, which voted unanimously on June 17, 2002 to table IR 1730–2002 so that separate resolutions segregating the Toussie-related parcels could be drafted and introduced. (Defs.' 56.1 Stmt. ¶ 35 & Ex. X.) ⁸

On June 25, 2002, two resolutions, IR 1800–2002, which proposed approval of the sales to Plaintiffs, and IR 1801–2002, which proposed approval of the remaining sales, were introduced and assigned to the Committee. (Defs.' 56.1 Stmt. ¶ 36.) On July 29, 2002, IR 1801–2002 was discharged from Committee, and on August 6, 2002, it was approved by the Legislature. ( Id. ¶¶ 37–38.) IR 1800–2002, on the other hand, was tabled then retabled three times by the Committee. (Defs.' 56.1 Stmt. ¶¶ 39–48.) At the November 15, 2002 Committee meeting, Plaintiffs' counsel, Richard Hamburger, again stated that Plaintiffs were willing to enter into a binding agreement that would preclude any residential development of the parcels and Isaac's involvement with the land in any manner. (Pls.' 56.1 Stmt. ¶ 42.) Nevertheless, at the December 9, 2002 Committee meeting, IR 1800–2002 was defeated. ( Id. ¶ 48; Defs.' 56.1 Stmt. ¶ 48.) IR 1800–2002 was never voted on by the full Legislature, and it died in Committee.

On or about April 25, 2003, Plaintiffs filed an Article 78 proceeding in the Supreme Court of Suffolk County challenging the Legislature's disapproval of their sales in the 2002 Auction. See Toussie v. County of Suffolk, No. 03–9048 (N.Y. Sup.Ct. Suffolk Cnty. Sept. 23, 2003) (Defs.' 56.1 Stmt. Ex. OO.). The Supreme Court found in favor of Defendants, holding that (1) no valid contract existed, (2) in disapproving the sale, the Legislature was acting “within the clear letter of th[e] contract language,” and (3) the Legislature's decision was not arbitrary or capricious. Id. The Appellate Division affirmed, see Toussie v. Cnty. of Suffolk, 26 A.D.3d 506...