Opinion
401548/2010.
Decided May 27, 2011.
Michael A. Cardozo, Corporation Counsel, New York, New York, for Plaintiff.
Siegle Sims, LLP, New York, New York, for Defendants.
The Defendants, Harlems Shop Mart, Inc. and Bandar A. Kalid cross-move to dismiss for failure to state a cause of action under CPLR 3211(a)(7) Plaintiff's Nuisance Abatement proceeding brought under Sections 7-704(a) and 7-706(a) of the New York City Administrative Code. For reasons set forth below, Defendants' cross-motion to dismiss is denied in part and granted in part.
BACKGROUND
Harlem Shop Mart (the "Premises") rests on the real property which is the subject of this action, 250 Bradhurst Avenue, Tax Block 2047, Tax Lot 44, New York, New York. Defendant B250 Holding LLC is the owner of that real property. Defendant Harlems Shop Mart Inc. is the operator of the Premises and Defendant Bandar A. Kalid is its principal.
The Premises has been the site of four controlled "buy" operations by the New York City Police Department. On June 17, 2009, the confidential informant (the "CI") entered the Premises and purchased numerous zip lock bags for twenty dollars. Again, on August 4, 2009, January 6, 2010 and January 12, 2010, the CI entered the Premises and on each occasion purchased numerous zip lock bags in exchange for thirty dollars.
On January 20, 2010, Detective Angus MacKenzie (the "Detective") participated in the execution of a search warrant at the Premises. On a shelf behind the counter, the Detective recovered: (1) four bags each containing numerous small green zip lock bags; and (2) three cartons and thirty-five packs of cigarettes that lacked the required tax stamps. The police arrested three individuals inside the establishment. The individuals were charged with aiding, abetting and acting in concert for Criminally Using Drug Paraphernalia in the Second Degree in violation of NYS Penal Law § 220.50(2) and Unlawful Possession, Transportation and Sale of Untaxed Cigarettes in violation of NYS Tax Law § 1814(b).
On March 24, 2010, Judge Mandelbaum of the Criminal Court dismissed the charges brought pursuant to New York State Tax Law § 1814(b) and NYS Penal Law § 220.50(2), as "legally insufficient" against the three individuals arrested at the Premises.
On June 14, 2010, the City commenced this proceeding pursuant to §§ 704(a) and 706(a) of the Nuisance Abatement Law, seeking closure of the Premises, as well as payment of a penalty.
On June 15, 2010, the City made an ex-parte application for a temporary closing order and a temporary restraining order. This Court held a hearing on the preliminary injunction on June 17, 2010 and granted the interim order only to the extent that the defendants are enjoined from using the Premises for criminal sale or possession of drug paraphernalia. It vacated that part of the order to show cause that closed the Premises.
Discussion
CPLR 3211(a)(7) allows a party to move to dismiss one or more actions asserted against it on the ground that the pleading fails to state a cause of action. In considering a CPLR 3211(a)(7) motion to dismiss, "the court will accept the facts as alleged in the complaint as true, accord plaintiffs the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory.'" Nonnon v. City of New York , 9 NY3d 825 , 827 (2007) (quoting Leon v. Martinez, 84 NY2d 83, 87-88 (1994)). The court may "freely consider" Plaintiff's affidavits "to remedy any defects in the complaint." Leon, 84 NY2d at 88. "[T]he criterion is whether the proponent of the pleading has a cause of action, not whether he has stated one.'" Id. (quoting Guggenheimer v. Ginzburg, 43 NY2d 268, 275 (1977); Rovello v. Orofino Realty Co, 40 NY2d 633, 635 (1976)).
Here, the City's complaint alleges that a public nuisance exists at the Premises pursuant to two sections of the Nuisance Abatement Law. Specifically, it alleges that the controlled "buys" of ziplock bags and the ziplock bags found during execution of the search warrant of the Premises establish a public nuisance under section 7-703(g). It also contends that the possession of untaxed cigarettes, which were found during the search warrant execution, constitutes a nuisance under section 7-703(l) of the Nuisance Abatement Law.
The court will discuss whether the City has stated a cause of action under each of these sections of the Nuisance Abatement Law separately .
1. Section 7-703(g)
Under section 7-703(g), a public nuisance is defined as:
(g) Any building, erection or place, including one-or two-family dwellings, wherein, within the period of one year prior to the commencement of an action under this chapter, there have occurred three or more violations of any of the provisions of article two hundred twenty, two hundred twenty-one or two hundred twenty-five of the penal law and Nuisance Abatement Law.
(Emphasis added).
A "violation" in the context of Section 7-703(g), means the "existence of the prohibited conduct set out in the Penal Law Sections 220, 221 and 225 and does not require criminal prosecution or conviction." City of New York v. Castro, 160 AD2d 651, 652 (1st Dept. 1990). A proceeding under this section is "civil in nature" and jurisdiction is "in rem." Id.
Under Penal Law 220.50(2):
A person is guilty of criminally using drug paraphernalia in the second degree when he knowingly possesses or sells:
. . .
2. Gelatine capsules, glassine envelopes, vials, capsules or any other material suitable for the packaging of individual quantities of narcotic drugs or stimulants under circumstances evincing an intent to use, or under circumstances evincing knowledge that some person intends to use, the same for the purpose of unlawfully manufacturing, packaging or dispensing of any narcotic drug or stimulant.
(Emphasis added).
The City alleges that the ziplock bags sold on the Premises on June 17 and August 4, 2009 and on January 6th and 12th, 2010 and those found during execution of the search warrant on January 20, 2010 constitute five violations of Penal Law 220.50(2) and, therefore, are more than enough to show that a public nuisance, as defined under section 7-703(g), existed.
Defendants argue that the City has failed to state a cause of action because the sale of ziplock bags alone, without a showing of intent or knowledge of another's intent to use these baggies "for the purpose of unlawfully manufacturing, packaging or dispensing of any narcotic drug or stimulant" is not enough to establish a violation of section 220.50(2).
It is true that mere sale or possession of ziplock bags without more does not establish a violation of section 220.50(2) of the Penal code. Because such bags have an "innocent" purpose, when considering cases brought under section 225.50 courts look to the "presence of surrounding circumstances or conduct to establish that the possessor of items covered by Penal Law § 225.50 has knowledge that the articles will be used in the course of illegal narcotics activity." People v. Maass, 10 Misc 3d 1051(A) (NY City Crim. Ct. 2005) (finding that a criminal information was insufficient where defendant possessed 63 clear ziplock bags but there were no surrounding circumstances to establish knowledge of narcotics use); see People v. Ray, 51 NY2d 594, 604 (1980); People v. Johnson, 23 Misc 3d 1130(A) (NY City Crim. Ct. 2009). "Such circumstances may include an exchange of currency for the glassine envelope, furtive or evasive behavior or possession of such an envelope in a drug-prone area." People v. Maass, 10 Misc 3d 1051(A).
The court believes that this same standard should apply when reviewing the sufficiency of a complaint brought under Penal Code 225.50(2). Here, the court must find that the City not only alleged the possession of drug paraphernalia (in this case ziplock bags), but also that the City has described circumstances which, when giving the City the benefit of a positive inference, makes out a prima facie showing that defendant intended to use, or had knowledge that some person intends to use the envelopes "for the purpose of unlawfully manufacturing, packaging or dispensing of any narcotic drug." People v. Maass, 10 Misc 3d 1051(A).
Although it is a close call, the Court finds that the City has stated a cause of action under section 7-703(g) of the Nuisance Abatement Law. The complaint catalogues four controlled "buy" operations by the New York City Police Department, from June 17, 2009 to January 12, 2010, where money was exchanged for ziplock bags, which under Penal Code section 225.50(2) may be considered "drug paraphernalia." Moreover, the City has alleged surrounding circumstances which point to the possibility that the sales person had knowledge that the ziplock bags were intended for the manufacturing, packaging or sale of narcotics.
The City has included the affidavit of Detective MacKenzie who is trained in the "identification of controlled substances" and is "fully familiar with the drug paraphernalia associated with and/or used for the packaging, selling, ingesting and/or manufacturing of illegal drugs." The Detective states that the Premises is one that is "known to the Police Department as a place in which the sale of drug paraphernalia occurs." Moreover, the City not only alleged that money was exchanged during the four controlled "buys," but describes furtive and evasive behavior of the person behind the counter who left the store to retrieve the ziplock bags requested by the Detective.
Accepting "the facts as alleged in the complaint as true" and according the City "the benefit of every possible favorable inference" the court finds the allegations sufficient to deny Defendants' motion to dismiss for failure to state a cause of action under CPLR 3211(a)(7) with regard to the Section 703(g) nuisance claim, thus allowing the case to proceed to a hearing on this issue. It should be noted, however, that if the City plans to move forward, it will be required to prove its case by clear and convincing evidence. See N.Y.C. Administrative Code § 7-709 (a). 2. Section 7-703(l)
Defendants also argue that res judicata mandates that the ziplock bags found on January 20, 2010 cannot be used to show a violation of Penal law section 220.5(2) because the criminal complaint stemming from the execution of the search warrant was dismissed as "legally insufficient." Defendants sight no case law to support this proposition. At any rate, the court need not decide this issue because, as discussed above, the four "buys" as described in Detective's affidavit are sufficient to state a claim here.
The Defendants suggest that the court treat its CPLR 3211(a)(7) motion as a summary judgment motion as allowed under CPLR 3211(c). As this decision is discretionary, the court declines to do so.
Under Nuisance Abatement Law section 7-703(l) a public nuisance exists in:
Any building, erection or place, including one-or two-family dwellings, wherein there is occurring a criminal nuisance as defined in section 240.45 of the penal law.
Criminal nuisance in the second degree under Section 240.45(2) occurs when a person "knowingly conducts or maintains any premise, place or resort where persons gather for purposes of engaging in unlawful conduct." (Emphasis added).
The City contends that the existence of the unstamped cigarettes found during the execution of its search warrant constitutes a public nuisance because possession of these cigarettes is unlawful conduct under New York State Tax Law § 1814(b). This law states:
(b) Any person, other than an agent licensed by the commissioner, who possesses or transports for the purpose of sale any unstamped or unlawfully stamped packages of cigarettes subject to tax imposed by section four hundred seventy-one of this chapter . . . shall be guilty of a misdemeanor.
Defendants argue that the city fails to state a cause of action here because there is no showing that the cigarettes found were "for the purpose of sale" and it is not a crime simply to possess such cigarettes if they are not intended for sale.
The court agrees that the City has failed to state a cause of action under the exclusion. First, as in City of New York v. Land and Building Known as 283 Ralph Avenue, this court finds that a violation of section 1814 of the Tax Law is not "unlawful conduct" under Penal Law section 240.45(2). 17 Misc 3d 1004 (Sup. Ct. 2007).
In 283 Ralph Avenue, the court considered an application by the City of New York pursuant to Nuisance Abatement Law section 7-703(l) for a temporary restraining order and temporary closing order against a grocery where there had been "two isolated sales of a single pack of untaxed' cigarettes" and the confiscation pursuant to execution of a search warrant of 12 packs of unstamped cigarettes. Id. at 1006. The court found that "neither the retail sale of unstamped cigarettes, nor the possession of unstamped cigarettes for the purpose of retail sale . . . is unlawful conduct' within the meaning of Penal Law § 240.45(2)." It based its decision on the fact that the tax law was intended to raise revenue and not to protect "the safety or health of a considerable number of persons." Thus, it found that a place where the sale of untaxed cigarettes occurs is not a "place . . . where persons gather for purposes of engaging in unlawful conduct" as envisioned under the Nuisance Abatement Law. Id. at 1010 (internal quotations marks omitted). Accordingly, the court dismissed the City's application as "substantially devoid of merit." Id. at 1005.
In adopting this reasoning here, the court finds that the mere possession of unstamped cigarettes does not state a cause of action for public nuisance because there was no unlawful conduct.
Second, even if a violation of the Tax Law could be considered unlawful conduct under section 240.45(2), possession of such cigarettes alone does not constitute a violation of the tax statute. The City must show that Defendant's possessed the cigarettes "for the purpose of sale." The City, however, has failed to describe any surrounding circumstances to point to the sale of these cigarettes from the Premises. Unlike the issue of the ziplock bags above, here the City did not plead any circumstances, other than the discovery of the cigarettes itself, to indicate that the cigarettes were for sale at the Premises.
Therefore, with regard to the City's claim under section 7-703(l) of the Nuisance Abatement Law, the court grants Defendants' motion to dismiss for failure to state a cause of action.
In accordance with the foregoing, therefore it is:
ORDERED that defendants' cross-motion to dismiss the complaint pursuant to CPLR 3211(a)(7) with regard to its claim of Nuisance Abatement Law under section 7-703(g) is denied and the parties may proceed to a hearing on that issue; and
It is further ORDERED that defendants' cross-motion to dismiss pursuant to CPLR 3211(a)(7) with regard to its claim of Nuisance Abatement Law under section 7-703(l) is granted.
This constitutes the decision and order of this Court.