OAH 58-6020-18008-3

 

 

STATE OF MINNESOTA

OFFICE OF ADMINISTRATIVE HEARINGS

 

FOR THE ST. PAUL CITY COUNCIL

 

 

In the Matter of Adverse Action Against All Licenses Held by DRJ, Inc., d/b/a Diva’s Overtime Lounge

FINDINGS OF FACT, CONCLUSIONS OF LAW,AND RECOMMENDATION

 

 

The above matter came on for hearing before Administrative Law Judge Linda F. Close on May 7, 2007, at City Hall in St. Paul, Minnesota.  The record closed on May 11, 2007, upon receipt from counsel of a Stipulation about a videotape described in testimony during the May 7th hearing.

Rachel Gunderson, Assistant City Attorney, 400 City Hall, 15 West Kellogg Blvd., St. Paul, Minnesota 55102, appeared on behalf of the Office of License, Inspections and Environmental Protection (LIEP) of the City of St. Paul (the City).  Andrew J. Dawkins, Of Counsel to Mansfield, Tanick & Cohen, P.A., 220 South Sixth Street, Suite 1700, Minneapolis, MN  55402-4511, appeared on behalf of DRJ, Inc., d/b/a Diva’s Overtime Lounge (the Licensee).

This report is a recommendation, not a final decision.  The St. Paul City Council will make the final decision after a review of the record and may adopt, reject or modify the Findings of Fact, Conclusions, and Recommendation.  Under St. Paul Legislative Code § 310.05(c-1), the City Council shall provide the Licensee an opportunity to present oral or written arguments alleging error in the application of the law or the interpretation of the facts and to present argument related to the recommended adverse action contained in this Report.  Parties should contact Rachel Gunderson at the address above to learn the procedure for filing exceptions or presenting argument.

STATEMENT OF ISSUES

1.          Did the Licensee violate Minn. Stat. § 340A.502 and St. Paul Legislative Code § 310.06(6)(a) by furnishing alcohol to an obviously intoxicated person?

2.               Did the Licensee violate St. Paul Legislative Code § 310.06(b)(5) by failing to comply with a condition of its license that requires it to maintain videotapes and make them immediately available to the St. Paul Police and LIEP?

Based upon all the proceedings herein, the Administrative Law Judge makes the following:

FINDINGS OF FACT

1.               The Licensee has held an on-sale liquor license from the City since October of 2005.  When the City first licensed the Licensee, it authorized a 2:00 a.m. closing time.  Effective October 4, 2006, the City revoked that authority and required the Licensee to close at 1:00 a.m.[1]  

2.               LIEP requires some licensees to maintain video systems to record events on the licensed premises.[2]  When the Licensee received its license in October of 2005, condition number four on the license was the following:

The licensee must provide working video surveillance cameras and recorders on the premise [sic] to provide documentation of activities on the interior and exterior of the establishment.  This equipment must be in operation during all business hours.  Tapes must be maintained for thirty (30) days and must be immediately available to the Saint Paul Police Department and the Office of License, Inspections and Environmental Protection, upon request.[3]

3.               The Licensee, through its owner Debra Johnson, agreed to the above condition at the time of the issuance of the license.[4]  The Licensee has seven or eight cameras which is the number required to show the entire interior of the establishment as well as its exterior.[5]  At some point in time, City officials adjusted the camera angles.[6]

4.               At 1:17 a.m. on March 3, 2007, two St. Paul Police Department officers were on patrol near the Licensee’s establishment.  They saw a small group of people outside the bar.  One of the group, who was later identified as Martin Johnson, was yelling at a security guard and waving his arms in the air.  As the officers approached, Martin Johnson ran at the security guard and began trying to hit him.  After announcing themselves as officers and ordering Martin Johnson to stop the assault, the officers interceded.  When Martin Johnson continued his attack, one of the officers used a Taser device to stun him.  At that point, Martin Johnson fell to the ground.[7]

5.               One of the officers spoke with the Licensee’s security guard, Pedro Grijalva.  Grijalva reported that he had removed Martin Johnson from the licensed premises because Martin Johnson was too intoxicated and had acted inappropriately inside the bar.  The officers arrived shortly after Grijalva had ejected Martin Johnson from the bar.[8]  

6.               The arresting officers observed that Martin Johnson smelled of alcohol and his speech was slurred.  Due to Martin Johnson’s intoxicated state, the officers had to drag him to the squad car.  They had difficulty getting him into the squad car because of his condition.  They arrested Martin Johnson for disorderly conduct and took him to the Law Enforcement Center.  Once there, Martin Johnson admitted he was “drunk.”[9] 

7.               The police prepared a report about the March 3rd incident and forwarded it to LIEP.[10]  Upon review of the report, LIEP deputy director Christine Rozek wrote a letter to the Licensee requesting the establishment’s videotapes from the evening of March 2-3.  Rozek requested all tapes from all cameras inside and outside the establishment.  The letter, dated March 5, 2007, gave the Licensee until Friday March 16, 2007, to produce the tapes.[11]  Rozek made the request because she was concerned that the Licensee may have served Martin Johnson when he was intoxicated.[12]

8.               On March 7, 2007, Debra Johnson, the Licensee’s owner, called Rozek, asking for more specific information about the time frame for the tapes.  Rozek returned the call, leaving a message that she wanted all tapes from 9:00 to midnight on March 2nd and midnight to 1:30 a.m. on March 3rd.[13]

9.               On the morning of March 19, 2007, Rozek received a videotape from the Licensee.  Upon review of the videotape, Rozek discovered that it did not show camera angles from outside the establishment.  The videotape revealed only about one-fourth of the service area inside.  There was a clear view of security checking patrons as they entered the bar.  Although the videotape did show Martin Johnson entering the establishment, the viewer could not see whether he was served.[14] 

10.           Kristina Schweinler is the senior license inspector with LEIP.  She viewed the tape with Rozek.  Upon review, she saw that the tape switched between one date and another and switched from black and white to color.  In some shots, patrons wore shorts and short sleeves, although the tape was to have recorded March 2nd, when the whether was cold.  In other shots, patrons were smoking, indicating that the video could not have been from March 2, 2007, by which date smoking had been banned entirely from bars. The portion of the tape from March was recorded at 16 times normal speed at points.  Schweinler found that the tape was useless for determining whether the Licensee had served Martin Johnson when he was intoxicated.[15]  The videotape did not include video from all cameras both inside and outside of the establishment for the requisite hours and dates.[16]

11.           On April 12, 2007, the Assistant City Attorney for the LIEP Office issued a Notice of Violation relating to the above events.  The cited violations included the Licensee’s failure to comply with the deadline set for producing the videotape and failure to provide videotapes of all cameras and camera angles.  The Notice gave the Licensee three options for disposing of this matter.  First, the Licensee could pay a fine of $1,000.00.[17]  Second, the Licensee could admit the facts and refer the matter to the City Council, where it would be combined with a pending adverse action against the Licensee in which LEIP would recommend license revocation.  Third, the Licensee could request a hearing before an Administrative Law Judge.[18]

12.           On April 23, 2007, Licensee’s counsel notified the Assistant City Attorney for the LIEP Office that the Licensee was requesting a hearing before an Administrative Law Judge.[19]

13.           On April 25, 2007, the Assistant City Attorney for the LIEP Office issued an Amended Notice of Violation and Notice of Administrative Hearing.  The Notice stated the time and place for the May 7th hearing and amended the charges to include violation of Minn. Stat. § 340A.502, furnishing alcoholic beverages to an obviously intoxicated person.[20]

14.           At the May 7, 2007, hearing, the Licensee’s bartender, Clint Kaufenberg; Pedro Grijalva, the security person; and the owner’s husband, Jeffrey Johnson, all testified about Martin Johnson’s condition on the night of March 2nd and the early morning hours of March 3rd. 

15.           Kaufenberg served Martin Johnson with two drinks after Martin Johnson came into the bar between 11:00 and 11:30.  Kaufenberg observed nothing unusual about Martin Johnson’s behavior at that time.  Martin Johnson left the bar and returned later.  When it was past serving time,[21] Martin Johnson ordered another drink, but Kaufenberg refused to serve him because of the hour.  Martin Johnson thereupon threw money at Kaufenberg and then threw his watch against the wall.[22]

16.           Grijalva first saw Martin Johnson in the bar between 11:00 and midnight.  When Martin Johnson entered the bar he acted fine, but his demeanor changed later.  Grijalva saw him throw the watch against the wall.  At that point, Grijalva approached Martin Johnson and then escorted him from the bar.  Once outside, Martin Johnson began attacking Grijalva.[23]

17.           Jeffrey Johnson helps with the Licensee’s bookkeeping.  He arrived at the bar around 11:30 p.m. on March 2nd.  He saw Martin Johnson playing pull tabs at the bar, but he saw nothing unusual about Martin Johnson’s conduct.  Martin Johnson did not appear to be intoxicated at the time.  Jeffrey Johnson went outside to check the parking lot and then returned to the bar.  Around 12:30 or quarter to one, Jeffrey Johnson saw Martin Johnson throw the money.[24]

Based upon the above Findings of Fact, the Administrative Law Judge makes the following:

CONCLUSIONS OF LAW

                  1.                 The Administrative Law Judge and the St. Paul City Council have jurisdiction to hear this matter pursuant to St. Paul Legislative Code §§ 310.05-06.

                  2.                 LEIP gave proper notice of the hearing and has fulfilled all relevant substantive and procedural requirements of law and rule.

                  3.                 As the party proposing that certain action be taken, LEIP has the burden of proving facts at issue by a preponderance of the evidence.

                  4.                 Minn. Stat. § 340A.502 prohibits the sale of alcoholic beverages to a person who is “obviously intoxicated.”  Pursuant to this authority, the St. Paul Legislative Code further permits the City to impose license sanctions, including license revocation, upon a licensee who serves alcohol to a person who is obviously intoxicated.[25] 

                  5.                 LEIP has shown, by a preponderance of the evidence, that the Licensee served alcoholic beverages to a person who was obviously intoxicated.

                  6.                 St. Paul Legislative Code § 310.06 (b) authorizes the Council to take adverse action against a licensee who violates a condition of the license.  Adverse action includes a variety of disciplinary actions ranging from fines to license revocation.[26]

                  7.                 LEIP has shown, by a preponderance of the evidence, that the Licensee violated a condition of her license by failing to provide requested videotapes in a timely manner.

                  8.                 LEIP has shown, by a preponderance of the evidence, that the Licensee violated a condition of her license by failing to provide all videotapes requested by LEIP.

Based upon the above Conclusions of Law, the Administrative Law Judge makes the following: 

RECOMMENDATION

IT IS HEREBY RECOMMENDED that the St. Paul City Council take appropriate action against the licenses of DRJ, Inc., d/b/a Diva’s Overtime Lounge.

Dated:  May 30, 2007

                                                                      s/Linda F. Close

LINDA F. CLOSE

Administrative Law Judge

 

Reported:  Tape recorded (three tapes)

 

NOTICE

The St. Paul City Council is requested to serve notice of its final decision upon each party and the Administrative Law Judge by first-class mail.

MEMORANDUM

The only doubtful issue in this case is whether the Licensee served alcohol to an obviously intoxicated person.  Three persons with close ties to the Licensee—the owner’s husband, the bartender and the security person—all testified that signs of Martin Johnson’s intoxication did not emerge until closing time at the bar.  In addition, the owner testified that Martin Johnson did not appear to be intoxicated until late in the evening.

          For many reasons, the ALJ has discounted this testimony.  Here, actions truly speak louder than words.  Foremost is the owner’s destruction of the very evidence that would have shown Martin Johnson’s condition when the bartender admittedly served him.  The purpose of requiring a licensee to maintain and turn over videotapes is to deter illegal behavior by the licensee and to prove a case of violation when the licensee does violate the law.[27]  The Licensee did not maintain the tapes as required and, in fact, tampered with them in an effort to avoid prosecution for the violation that occurred on the evening of March 2nd.  The evidence tampering was blatant—video from the summer months was spliced into tape of an early March evening.  Tape from the pre-smoking ban time period was also spliced in.  Black and white tape from the outdoor cameras was combined with tape from the color, interior tape.  The incident of Martin Johnson throwing money and his watch was not on the tape at all, apparently.[28]

          In addition to the owner’s actions, the actions of Martin Johnson speak to whether he was served at a time when he was intoxicated.  His violent behavior in the bar led to his expulsion from the bar. The police arrived very soon after closing.  Martin Johnson was so intoxicated that he did not even respond to the presence of the police when they ordered him to stop attacking the security officer.  The officers had to stun him to deter his attack on the security officer.  Because of his condition, the officers could barely get Martin Johnson into the squad car.  From this, it can be inferred that Martin Johnson had been intoxicated for a significant period of time, during which time he was in the bar.  Based on all the circumstances, the likely scenario is that the Licensee served Martin Johnson alcohol and continued to serve him when he was already intoxicated.

          The ALJ also rejects the testimony of the Licensee’s witnesses for additional reasons.  The owner’s testimony was replete with inconsistencies.  In particular, she steadfastly maintained that the videotapes were complete and accurate when she reviewed them.  Obviously, only she had access to tape that was spliced in from times predating the March 2-3 events.  Her testimony about Martin Johnson’s character was also inconsistent—at one point, she implied that Martin Johnson was known for being a troublemaker who had to be watched in the bar.  Later, she denied that.  The owner’s testimony simply cannot be credited.

          The bartender’s testimony is discounted because of his obvious self-interest in this matter and because his testimony about serving Martin Johnson was inconsistent.  He testified at one time that he refused to serve Martin Johnson at 12:15 or 12:30 because he thought Martin Johnson had had enough.  Later, the bartender said service was refused after bar closing time.  Moreover, although Martin Johnson apparently left the bar, the evidence is that he left only to smoke outside.  There is no evidence that he went elsewhere to consume alcohol.  The testimony of the owner’s husband and the security guard was credible, but it shed no light on Martin Johnson’s condition or on how much he was served before closing. 

          Whether the Licensee violated a condition of her license by failing to provide complete videotapes in a timely manner also cannot be seriously debated.  The Licensee argues that her failure to provide the videotape by the close of business on Friday, March 16, 2007, is inconsequential, given that a tape was provided to LEIP on Monday morning, March 19th.[29]  While the time lapse by itself might be overlooked in other circumstances, when it is placed in the context of the larger picture, the failure to timely comply with LEIP’s directive is significant.  The larger picture includes the owner’s deliberate alteration of the tapes to eliminate evidence of the Licensee’s violation of the prohibition on serving alcohol to an obviously intoxicated person.

          The City’s legislative code includes a matrix of presumptive penalties.[30]  The City Council may deviate from the matrix if there are “substantial and compelling reasons making it appropriate to do so.”  In this case, there is no evidence to support a downward departure from the matrix.  On the contrary, the evidence may support an upward departure.  In any event, the evidence supports adverse action as to the license.

L. F. C.


[1] Testimony of Christine Rozek; Ex. 1.

[2] Test. of C. Rozek.

[3] Ex. 2.

[4] Test. of C. Rozek; Ex. 2.

[5] Testimony of Kristina Schweinler.

[6] Testimony of Debra Johnson.

[7] Testimony of Officer Eric Skog; Ex. 3.

[8]  Test. of E. Skog; Ex. 3.

[9]  Test. of E. Skog; Ex. 3.

[10] Test. of E. Skog; Ex. 3.

[11] Ex. 4.

[12] Test. of C. Rozek.

[13] Test. of C. Rozek; Ex. 4

[14] Test. of C. Rozek

[15] Test. of K. Schweinler.

[16] Stipulation of the Parties dated May 10, 2007.

[17] Since this was a second violation, the penalty was set at $1,000.00 pursuant to the penalty matrix.  Ex. 5-2.

[18] Ex. 5-2.

[19] Ex. 6.

[20] Ex. 7.

[21] The Licensee quits serving alcohol at 12:45.  Testimony of Clint Kaufenberg.

[22] Test. of C. Kaufenberg.

[23] Testimony of Pedro Grijalva.

[24] Testimony of Jeffrey Johnson.

[25] St. Paul Legislative Code § 409.26 (b) (4).

[26] St. Paul Legislative Code § 310.01.

[27] Test. of K. Schweinler.

[28] The smoking ban became effective on March 31, 2006, so the video of patrons smoking and of ash trays placed about the establishment obviously predated the March 2, 2007 incidents.  The tape included footage of Debra Johnson talking with customers as they smoked.  Test. of K. Schweinler.

[29] Debra Johnson testified that she arrived at the LEIP offices just after closing on Friday, March16th.  In preparation for a licensure action scheduled to begin the following week, she had been serving subpoenas on police officers that afternoon and ran out of time.  Test. of D. Johnson.   Jeffrey Johnson testified that he dropped the videotape off the following Monday morning.  Test. of J. Johnson.

[30] See St. Paul Legislative Code § 301.05 (m)