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OAH 61-6020-21226-3 |
STATE OF
OFFICE OF ADMINISTRATIVE
HEARINGS
FOR THE CITY OF
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In
the Matter of Adverse Action Against All Licenses Held By Moonlight Magic,
Inc., d/b/a Moonlight |
FINDINGS OF FACT, CONCLUSIONS ANDRECOMMENDATION |
This matter came on for hearing before Administrative Law
Judge M.
Virginia D. Palmer, Assistant St. Paul City Attorney,
STATEMENT OF THE ISSUES
1.
Did the City prove by a preponderance of the evidence that Moonlight
served alcohol to underage persons on December 17, 2009?
Yes, the ALJ finds that the City did meet its burden of proof on this
issue.
2.
Did the City prove by a preponderance of the evidence that, on
December 31, 2009, Moonlight violated the conditions of its license by
failing to check the identification of all patrons entering the establishment?
Yes, the ALJ finds that the City did meet its burden of proof on this
issue.
3.
If so, is revocation the appropriate licensing sanction based on the
Licensee’s history of violations?
For the reasons set for the below, the Administrative Law Judge concludes that a licensing sanction other than revocation is warranted on this record.
Based on the
evidence in the hearing record, the Administrative Law Judge makes the
following:
FINDINGS OF FACT
Factual Background
1.
Mr. Moua Yang is the owner of Moonlight Magic, Inc. d/b/a Moonlight,
and the property, which is located at
2.
On October 12, 2005, Moonlight first received its liquor license.[2] Moonlight’s current liquor and other licenses
contain fourteen conditions. Condition
number four states:
Security at the entrance (or bar staff if no security is present) shall
verify the age of all patrons entering the establishment by checking state or
federally issued identification cards (no picture I.D., no entrance). Patrons re-entering the establishment shall be
subject to the same security measures as patrons entering the establishment for
the first time.[3]
3.
The Licensee operates separate venues, with two separate entrances,
under these licenses. The lower level,
known as Moonlight, contains a bar and restaurant. Moonlight caters to an Asian clientele.[4] The upper level is a well-known blues club
started in 1979 known as Wilebski’s Blues Saloon (“Wilebski’s”).[5] Wilebski’s caters to a black and white
clientele.[6]
4.
The son of Thaddeus Wilebski, II, operates the Wilebski’s venue under
an agreement with Moonlight. Mr.
Thaddeus Wilebski II acts as a consultant to his son and occasionally works at
the venue. He is also a prior owner of
the property.[7]
5.
Mr. Wilebski’s nephews provide security for the Wilebski’s venue. The Wilebskis and the nephews have been orally
advised of the license conditions but have not received or viewed the 14
conditions as written.[8]
6.
Patrons enter to the Wilebski’s venue through a stairwell that has a
landing approximately halfway to the top. Security personnel check patrons’
identification at the midway landing. At
the top of the stairs is another landing where employees collect cover-charge
monies from patrons. After payment of
the cover charge, patrons are permitted to enter the bar and entertainment
area.[9]
Serving Alcohol to Underage Persons on December 17, 2009
7.
Sergeant David Schoen has been a police officer for more than 22 years
and has been attached to the City Police Department Vice Unit for the past 10
years. For approximately the past five
years, Sergeant Schoen has been the principal liaison to the Department of
Safety and Inspections (DSI), where he maintains an office.[10]
8.
As he routinely does, on December 17, 2009, Sergeant Schoen was
conducting a series of undercover checks of bars for liquor, tobacco, and
license condition compliance.[11]
9.
The compliance checks on December 17, 2009, included the use of three
minors to check whether licensees would serve them alcoholic beverages or sell
them tobacco. One 17-year-old minor
would attempt to purchase cigarettes. The
other two “checkers,” one 18 and one 19, would go in together and attempt to
purchase and be served alcohol. Payment
for attempted purchases of alcohol would be made with a marked twenty-dollar
bill.[12]
10.
Moonlight passed the tobacco check because the tobacco checker reported
that Moonlight does not sell cigarettes.[13]
11.
Both of the alcohol checkers are sons of police officers and have prior
experience in conducting compliance checks. One of them is the son of Sergeant Schoen. Sergeant Schoen personally trained both
checkers. Among the rules that the checkers
learn and follow are that they: must go directly to the bar and order alcohol;
must be truthful if asked for their identification; must be polite and
courteous; may not engage in deceit; and must call Sergeant Schoen immediately
if served alcohol.[14]
12.
The two minor alcohol checkers entered Moonlight at approximately
7:50 p.m. and ordered two Bud Light beers from the sole bartender, Nu Chi
Lee. Within a minute and a half of their
entrance into the bar, Ms. Lee had served each of the checkers a bottle of Bud
Light beer, accepted the marked twenty-dollar bill and placed the change on the
bar. Ms. Lee, who had been bartending
for two months, did not ask either checker for their identification prior to
their purchase. Upon being sold the
beers, Sergeant Schoen’s son called him, and advised him that they had been
served alcohol.[15]
13.
Sergeant Schoen and Sergeant John Bandemer then entered Moonlight and
identified themselves to Ms. Lee and asked her if she had served the checkers
the two Bud Light beers that were sitting on the bar in front of them. Ms. Lee declined to answer and asked to get
her manager. Sergeants Schoen and
Bandemer photographed Ms. Lee and the two beers. Ms. Lee provided her
14.
Sergeant Schoen completed a report of the December 17, 2009, compliance
check at Moonlight the next day, December 18, 2009. Sergeant Schoen’s report
was forwarded to DSI.[17]
Failure to Check Identification of Patrons on December 31, 2009
15.
On December 31, 2009, two of Mr. Wilebski’s nephews were wearing
Wilebski Blues Saloon Security shirts and performing the security functions on
the midway landing leading up to the Wilebski’s venue. Mr. Wilebski and his girlfriend were at the
upper landing collecting the $20.00 cover charge.[18]
16.
Undercover Sergeants Schoen and Sandell parked their unmarked vehicle[19] near Moonlight at
approximately 10:45 p.m. They observed
several patrons outside smoking in front of the door leading upstairs to the
Wilebski’s venue. They observed many
patrons coming and going from that door. It was busy with many cars on the street as
well as the patrons coming and going.[20] One of the smoking patrons recognized one or
both of the sergeants as police officers and went up the stairs and advised the
two security personnel that the police were coming into the establishment.[21]
17.
Sergeants Schoen and Sandell went up the stairs to the landing where
one of the security personnel was checking identification. Sergeant Schoen observed that:
It appeared he was doing a good job of checking people under the age of
30. Sgt. Sandell and I were able to go
by unchecked.[22]
18.
Sergeants Schoen and Sandell continued up the stairs to the upper
landing where they were greeted by Mr. Wilebski and his girlfriend, who asked
them for the $20.00 cover charge.[23] Mr. Wilebski’s girlfriend recognized Sergeant
Sandell from a previous encounter. Both
Mr. Wilebski and his girlfriend were very friendly. After Sergeants Schoen and Sandell declined to
pay the $20.00 cover charge since they said they were there for “just one,” Mr.
Wilebski’s girlfriend told them to please come back another time.[24] It was very busy inside the bar with
approximately 150 mostly white patrons, averaging 40 years of age, drinking and
talking. Patrons were lined up at the
bar waiting to be served. The band was
preparing to play at the rear corner stage of the bar.[25]
Procedural Findings
19.
On July 15, 2009, the City Council imposed a $2,000.00 fine and
suspended the licenses of Moonlight for 30 days beginning August 5, 2009
through September 3, 2009, for violations of license conditions on four dates. Violations were insufficient security personnel,
failure to maintain security videos, failure to wand and check identification,
and failure to clear out patrons by the required time.[26]
20.
On August 5, 2009, the City Council suspended the licenses of Moonlight
for 30 days beginning September 4, 2009 through October 3, 2009, for violations
of license conditions on July 5, 2009. Violations
were insufficient security personnel, failure to wand, and service of liquor
after the time permitted.[27]
21.
On December 23, 2009, DSI sent a request for adverse action to the City
Attorney’s Office related to the December 17, 2009, incident.[28]
22.
On January 6, 2010, the City sent a Notice of Intent to Revoke Licenses
to Moonlight, because of the December 17, 2009, incident, incorrectly stating
in the Notice that it was notice of a fourth appearance before the City
Council.[29]
23.
On January 8, 2010, the City sent an Amended Notice of Intent to Revoke
Licenses to Moonlight, because of the December 17, 2009, and December 31, 2009,
incidents, stating in the notice that these were the third and fourth
violations.[30]
24.
On January 15, 2010, Moonlight, through its attorney, requested a
hearing in connection with the alleged violations.[31]
25.
On April 12, 2010, the City issued a Notice of Administrative Hearing
to Moonlight to be held on May 12, 2010.[32]
Based on these Findings of Fact, the Administrative Law Judge makes the following:
CONCLUSIONS
1.
The Administrative Law Judge and the St. Paul City Council have
authority to hear this matter pursuant to St. Paul Legislative Code §
310.05(c).
2.
The hearing in this matter was conducted in accordance with the
applicable procedures set forth in section 310.05 of the St. Paul Legislative
Code.
3.
The City gave proper notice of the hearing in this matter and has
fulfilled all procedural requirements of rule or law.
4.
The City has the burden of proving by a preponderance of the evidence
that adverse action is warranted against the licenses held by Moonlight Magic,
Inc.
5.
The St. Paul Legislative Code prohibits any licensee, or agent or
employee thereof, from serving or dispensing any intoxicating liquor to any
minor; “nor shall such licensee, agent or employee permit any minor to be
furnished with or to consume any such liquor on the licensed premises; nor
shall such licensee, agent or employee permit any minor to be delivered any
such liquor.”[33] Licensees are responsible for insuring that
any individual under the age of 21, other than an employee, who enters the
establishment is present only for the purpose of consuming a meal or attending
a social function open to the public held in a portion of the establishment
where liquor is not sold, consumed, served or displayed.[34]
6.
The City demonstrated by a preponderance of the evidence that on
December 17, 2009, the Licensee furnished and/or delivered liquor to minors on
the premises in violation of § 409.08(2)(a) of the St. Paul Legislative Code.
7.
The City demonstrated by a preponderance of the evidence that on
December 31, 2009, Licensee failed to comply with Condition #4 of its licenses
requiring it to “verify the age of all patrons entering the establishment by
checking state or federally issued identification cards (no picture I.D., no
entrance).”
8.
Section 310.05(m) of the St. Paul Legislative Code contains a penalty
matrix applicable to all license types, “except that in the case of a violation
involving a liquor license § 409.26 shall apply where a specific violation is
listed.” The penalty matrix in §
310.05(m) sets out presumptive penalties for violations of conditions placed on
a license and violation of provisions of the legislative code relating to the
licensed activity. These penalties are
presumed to be appropriate for every case; however, the Council may deviate
from the presumptive penalty in an individual case where the Council finds and
determines that there exist substantial and compelling reasons making it more
appropriate to do so. When deviating
from these standards, the Council shall provide written reasons that specify
why the penalty selected was more appropriate.[35]
9.
Pursuant to § 310.05(m) of the St. Paul Legislative Code, this would be
the Licensee’s third appearance within 18 months, for which the presumptive
penalty is a $2,000.00 fine and a 10-day license suspension.[36]
10.
Section 409.26 of the St. Paul Legislative Code, applicable to liquor
licenses, contains a different penalty matrix that sets out presumptive
penalties for specific offenses in connection with the sale of intoxicating
liquor, including after hours display or consumption of alcohol and sale of
alcoholic beverages to underage persons.[37] The purpose of this section is to establish a
standard by which the City Council determines the length of license suspensions
and the propriety of revocations, and it applies to all on-sale and off-sale
licensed premises for intoxicating liquor and nonintoxicating liquor. The penalties in the matrix are presumed to
be appropriate for every case; however, the Council may deviate therefrom in an
individual case where the Council finds and determines that there exist
substantial and compelling reasons making it more appropriate to do so. When deviating from these standards, the
Council shall provide written reasons that specify why the penalty selected was
more appropriate.[38] The occurrence of multiple violations shall
be grounds for departure from such penalties in the council’s discretion.[39]
11.
Pursuant to § 409.26(b) of the St. Paul Legislative Code, this would be
the Licensee’s third appearance within 18 months, for which the presumptive
penalty is a license suspension of up to 18 days.[40]
12.
The City’s recommendation to revoke all licenses would require a
deviation from the penalty matrix contained in § 409.26. Except for a June 12, 2009, failure to check
identification, Licensee’s prior appearances before the Council have not
involved the specific offenses that are the subject of this matter. The prior violations involved violations of
other licensing conditions: lack of required security; failure to provide
required security video; patrons in the bar after hours; failure to wand
patrons; and serving liquor beyond the time set in a license condition.
13.
There are not substantial and compelling reasons to impose the sanction
of revocation in lieu of a fine and suspension of a license.
14.
The ALJ adopts as Conclusions any Findings that are more appropriately
described as Conclusions, and as Findings any Conclusions that are more
appropriately described as Findings.
15.
The Memorandum that follows below explains the reasons for these
Conclusions. To the extent that the
Memorandum includes matters that are more appropriately described as Conclusions,
the Administrative Law Judge incorporates those items into these Conclusions.
Based upon these Conclusions, and for the reasons explained
in the accompanying Memorandum, the Administrative Law Judge makes the
following:
RECOMMENDATION
Based upon these Conclusions, the Administrative Law Judge
respectfully recommends that the St. Paul City Council take adverse action
against the licenses held by Moonlight Magic, Inc.
Dated: June 11, 2010
s/M.
|
M.
KEVIN SNELL Administrative
Law Judge |
Reported: Digitally Recorded
NOTICE
This report is a recommendation, not a final decision. The St. Paul City Council will make the final
decision after reviewing the record and may adopt, reject or modify the
Findings of Fact, Conclusions and Recommendation contained herein. Pursuant to Section 310.05 of the St. Paul
Legislative Code, the City Council’s final decision shall not be made until
this Report has been made available to the parties to the proceeding and
Moonlight has been provided an opportunity to present oral or written arguments
alleging error on the part of the Administrative Law Judge in the application
of the law or the interpretation of the facts and an opportunity to present
argument relating to any recommended adverse action. Moonlight and any interested parties should
contact Shari Moore, Saint Paul City Clerk, 290 City Hall,
MEMORANDUM
There
are two contested issues in this matter. First is whether or not Moonlight failed to
comply with condition number four of its licenses on December 31, 2009. The Administrative Law Judge concluded that
Moonlight did so fail. The second is the
appropriate sanction for both the December 17 and 31, 2009, violations. Moonlight does not dispute its December 17,
2009, violation of law in serving alcohol to minors.
The
contested testimony revolved around the specific issue of whether or not the
Wilebski nephews who were performing the security functions on the mid-level
landing on the evening of December 31, 2009, checked the identification of
Sergeants Schoen and Sandell. Moonlight
relied on the hearsay testimony of Mr. Wilebski. He testified that the nephews told him that
they were first alerted by a patron that police officers were on their way up. This portion of the hearsay testimony is
believable in light of the testimony by Sergeant Schoen. He acknowledged that, notwithstanding the fact
that they were not in uniform, he and Sergeant Sandell could have been
recognized by patrons because they have been
Mr. Wilebski also testified
that the nephews also told him that the officers displayed their badges at the
landing and were allowed to pass on. This
testimony is not credible for several reasons. First, Sergeant Schoen’s testimony was
unwavering that neither he nor Sergeant Sandell displayed their badges to the
nephews at the landing. This testimony
was not disputed by direct evidence. Second,
the statements alleging the display of badges to the nephews is not supported
by any direct evidence.
Third, common sense dictates
that the statements regarding badge display at the landing cannot be given any
weight. The purpose of the compliance
checks is to determine whether or not all
patrons entering are being checked for identification. It is simply not believable that a police
officer would thwart the purpose of the exercise by displaying a badge before
being asked for identification. The
hearsay statements attributed to the nephews regarding the display of badges
were not subject to cross examination and were given no weight by the
Administrative Law Judge.
The proposed license revocation
raises important questions as to the overall proportionality of the sanction. Revocation of a
DIS argues that revocation
is the appropriate sanction because of the number of violations within a single
six month period. However, the evidence
suggests that the two prior suspensions served their remedial purpose in
eliminating Moonlights prior problems with complying with four of the fourteen
license conditions: having the required number of security personnel at the
appropriate times; availability of reliable security videos; patrons leaving
the premises by the required time; and service of alcohol after last call. The one repeat violation was for condition
number four, requiring the identification of all patrons prior to entry.
In the view of the
Administrative Law Judge, applying a set of other sanctions and regulatory
controls,[43] short of revocation, would
yield a better and more just result.
Conclusion
Because
the City did show by a preponderance of the evidence that Moonlight served
alcohol to minors on December 17, 2010, and failed to check the identification
of Sergeants Schoen and Sandell the evening of December 31, 2009, the
Administrative Law Judge recommends that the City affirm these violations and impose
an appropriate fine and a reasonable suspension of licenses.
M. K. S.
[1] Testimony of Moua Yang and Christine Rozek, Deputy Director, St. Paul Department of Safety and Inspections (DSI); Exhibit 2-1.
[2] Ex. 1-2; Test of C. Rozek.
[3] Ex. 2-1.
[4] Test. of Moua Yang.
[5] Testimony of Thaddeus Wilebski II, and Sergeant David Schoen, St. Paul Police Department.
[6] Test of M. Yang.
[7]
[8]
[9] Test. of T. Wilebski and D. Schoen.
[10] Test. of D. Schoen.
[11]
[12]
[13] Testimony of Sergeant John Bandemer.
[14] Test. of D. Schoen.
[15]
[16]
[17] Ex. 3; Test. of C. Rozek and D. Schoen.
[18] Test. of T. Wilebski and D. Schoen; Ex. 6-2.
[19] Sgt. Schoen testified that the unmarked vehicle was either a red pick-up truck or a black Chevrolet Monte Carlo.
[20] Ex. 6-2; Test. of D. Schoen.
[21] Test. of T. Wilebski.
[22] Ex. 6-2; Test. of D. Schoen.
[23]
[24] Test. of D. Schoen.
[25] Ex. 6-3.
[26] Ex. 1.
[27] Ex. 1-1.
[28]
[29] Ex. 5.
[30] Ex. 7.
[31] Ex. 8.
[32] Ex. 9.
[33]
[34]
[35]
[36]
[37]
[38]
[39]
[40]
[41] See,
[42] See generally In re Revocation of Family Child Care License of Burke, 666 N.W.2d 724, 728 (Minn. App. 2003); In re Ins. Licenses of Kane, 473 N.W.2d 869, 874 (Minn. App. 1991).
[43] See generally Saint Paul Legislative Code § 409.10. It would be reasonable to expand Moonlight’s condition number 12 to include periodic documentation of training of all employees and contractors with regard to all license conditions.