Joglo Realties, Inc. v. Seggos

JOGLO REALTIES, INC., and ROBERT TOUSSIE, Plaintiffs, v. BASIL SEGGOS, ACTING COMMISSIONEROF THE NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATIONin his official capacity; and UDO DRESCHER in his individual capacity, Defendants.

16-CV-1666 (ARR)(CLP)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

August 23, 2016

NOT FOR ELECTRONIC OR PRINT PUBLICATION

OPINION AND ORDER

ROSS, United States District Judge:

Plaintiffs, Robert Toussie and Joglo Realties, Inc.,¹ bring this action against the acting commissioner of the New York State Department of Environmental Conservation ("DEC") in his official capacity, and Udo Drescher, an attorney employed by the DEC, in his individual capacity. This case concerns a pending administrative action initiated by the DEC, with Drescher as its lead attorney, alleging that plaintiffs committed various environmental violations while repairing damage to their beachfront property following Hurricane Sandy. Plaintiffs allege that, through this administrative proceeding and other coercive conduct, Drescher has abused his power as an agent of the DEC to harass plaintiffs in an attempt to force them to surrender their private property to the public. Plaintiffs raise four claims pursuant to 42 U.S.C. § 1983 and seek a preliminary injunction to prevent the administrative proceeding from going forward. Defendants havemoved to dismiss plaintiffs' amended complaint, and urge the court to deny their motion for a preliminary injunction. For the reasons set forth below, defendants' motion to dismiss is granted and plaintiffs' motion for a preliminary injunction is denied.

BACKGROUND²

In 1977, plaintiffs purchased "the Esplanade," a 40 foot by 1,062 foot strip of oceanfront property located on top of the seawall protecting the southern end of Manhattan Beach, Brooklyn. Am. Compl. ¶ 9. The Esplanade is located a few feet south of six homes owned by plaintiff Toussie's family, and plaintiffs have spent millions of dollars maintaining and improving it over their forty years of ownership. Id.

On October 29, 2012, Hurricane Sandy ravaged Manhattan Beach, causing extensive damage to the seawall, the Esplanade, and Toussie's homes. Id. ¶ 10. Following the hurricane, plaintiffs sought emergency assistance from the DEC, the Army Corps of Engineers, and other New York City Agencies. Id. ¶ 13. Plaintiffs received "general permits" from the DEC, which authorized repairs to and reconstruction of their property damaged by the hurricane. Id. ¶ 15. During the next two years, plaintiffs performed numerous repairs to the seawall and the Esplanade. Id. ¶ 16. Plaintiffs contend that the newly repaired seawall is "the highest quality and most protective post-Sandy seawall in the area," id., and that, throughout the course of the reconstruction, the Army Corps of Engineers complimented their work as "sound, restorative, and very protective," id. ¶ 14.

Plaintiffs allege that, beginning in August 2013, defendant Drescher "embarked on a plan to take advantage of the work necessitated by Hurricane Sandy in order toextort Plaintiffs into relinquishing their ownership rights in the Esplanade." Id. ¶ 17. Plaintiffs believe that this scheme to coerce them into relinquishing their property has manifested in three ways.

First, plaintiffs allege they were baselessly threatened with criminal prosecution as a result of their repairs. On August 11, 2013, Drescher left a voicemail for plaintiff Toussie's lawyer threatening Toussie with criminal arrest as a result of purportedly unlawful construction work occurring at the Esplanade. Id. ¶ 21. Despite this threat, Toussie was not arrested or otherwise criminally sanctioned for any work performed on his property. Id.

Second, plaintiffs contend that Drescher collaborated with plaintiffs' neighbors to undermine plaintiffs' property rights. Id. ¶ 22. This allegation is based on statements made in filings in two lawsuits between Toussie and his neighbors. In these lawsuits, both of plaintiffs' neighbors stated that they had been "advised by the New York State Department of Environmental Conservation that Plaintiffs do not own the land or under water lands located seaward of the [Esplanade] at the end of Ocean Avenue," land that plaintiffs assert is unquestionably their private property. Id. ¶ 23. Another member of the DEC, George Stadnik, acknowledged to plaintiffs' counsel that the DEC provided this information in response to complaints from the Toussies' neighbors who wished to use the Esplanade. Id.

Third, and most importantly, Drescher signed an administrative complaint against plaintiffs, and, plaintiffs allege, has used the pending proceeding as leverage in his efforts to force plaintiffs to allow public access to the Esplanade. Id. ¶¶ 17, 24.

The administrative complaint, DEC File No. R2-20130724-348, was filed on July 8, 2014, and asserts twenty-six causes of action resulting from plaintiffs' repairs from early 2013 to the present. See id. ¶¶ 24-25; DEC Administrative Compl. ("DEC Compl.") Ex. A to Decl. of Jessica Albin in Supp. of Defs.' Mot. to Dismiss, Dkt. #34-1 ¶¶ 55-164.³ Although the administrative complaint at one point refers to plaintiffs' deed to the Esplanade as their "purported deed," DEC Compl. ¶ 15, the complaint does not contest plaintiffs' private ownership of the property or allege that the property should be made available for public access. See generally DEC Compl. ¶¶ 55-164 (alleging numerousviolations but making no allegation that plaintiffs do not actually own the Esplanade or cannot exclude the public from their property). As a result of the administrative complaint, however, plaintiffs have had to suspend their work on the Esplanade. Id. ¶ 41. Plaintiffs have been "repeatedly" burglarized and vandalized during this time, which they contend is a result of their inability to "properly secure the Esplanade" while the complaint against them is pending. Id.

Approximately one month after the administrative complaint was filed, plaintiffs' then-attorney met with Drescher and another representative of the DEC to discuss a potential settlement of the administrative action.⁴ Am. Compl. ¶ 26. During this meeting, Drescher stated that there is an area of the Esplanade that plaintiffs do not own and that their deed to the land was fraudulently obtained. Id. ¶¶ 27-28.

When the parties began to discuss a potential settlement, Drescher made his first direct demand that plaintiffs relinquish their ownership rights to the Esplanade. Drescher stated that the lack of public access to the Esplanade was the "biggest issue" for the DEC and that having the Esplanade "restored for public access" under the control of the City Parks Department was "what the DEC is looking for" in order to reach a settlement with plaintiffs. Id. ¶¶ 28, 30. When plaintiffs' counsel responded that any ownership issue wasirrelevant to the environmental proceeding, that Drescher was interfering with plaintiffs' property rights, and that Drescher was asking for concessions from plaintiffs that he could not receive in the context of an administrative hearing, Drescher "expressed no disagreement." Id. ¶¶ 27, 31, 33. Lastly, Drescher informed plaintiffs that while they could build an east-west fence protecting their immediate backyard, the DEC would not allow them to build a fence anywhere "in the Esplanade." Id. ¶ 31. When plaintiffs' counsel inquired as to whether this meant plaintiffs could not prevent members of the public from using the entire length of the Esplanade, Drescher "shrugged." Id.

Following this meeting, the parties agreed to stay the administrative proceeding in order to engage in further settlement discussions. Id. ¶ 39. During these discussions, Drescher maintained his position that "the ownership issues" are a problem and the parties were not able to reach an agreement.⁵ Id. ¶ 40. On May 4, 2016, the DEC refused to extend the stay as a result of this lawsuit, and the administrative proceeding became active for the first time since September 2014. Id. ¶ 39.

After the stay was dissolved, plaintiffs filed their answer to the administrative complaint on June 20, 2016. See Pls.' Answer to DEC Compl. ("Pls.' Answer"), Ex. B to Decl. of Jessica Albin in Supp. of Defs.' Mot. to Dismiss, Dkt. #34-2, at 27. The answer denied some of the conduct alleged in the complaint, but also admitted to much of theconduct, instead maintaining that many of plaintiffs' repairs were either authorized under a DEC permit or were outside the DEC's jurisdiction.⁶ See id. ¶¶ 55-206.

Lastly, plaintiffs allege that regardless of whether they have committed the environmental violations of which they are accused, they have been improperly singled out by the DEC. Id. ¶ 34. Plaintiffs state that their repair efforts following Hurricane Sandy are "more protective and more legally compliant" than that of many other private landowners in Manhattan Beach, and that other property owners rebuilt their seawalls without the appropriate permits. Id. ¶¶ 35, 38. Plaintiffs specifically compare themselves to fellow Manhattan Beach residents Kingsborough Community College ("Kingsborough") and the Menorah Center for Rehabilitation and Nursing Care ("Menorah Center"). Id. ¶¶ 36-37. Plaintiffs assert that Kingsborough's seawall is shorter than plaintiffs' wall, uses smaller stones, and uses a "vastly inferior" material, while the Menorah Center's seawall was built with construction debris and refuse, making it "less protective" than plaintiffs' wall. Id. Despite their inferior seawalls, neither Kingsborough, nor the Menorah Center, nor the private residences with which plaintiff alleges familiarity have been cited for environmental violations by the DEC. Id. ¶¶ 34-38.

Plaintiffs' amended complaint states four causes of action under Section 1983. Plaintiffs allege that their rights to substantive due process, procedural due process, and equal protection under the law (under two different constitutional theories) have been...