Collins v. Nuzzo

United States Court of Appeals
For the First Circuit

No. 00-1776

GARY J. COLLINS, D/B/A CAR PLACE WHOLESALERS,

Plaintiff, Appellant,

v.

FRANK NUZZO, JR., JEANNE M. CHRISTIANO, MICHAEL MARCHESE, JOHN
RAGUCCI, DAVID RAVANESI, GILBERT DELLISOLA, AND DAVID RAGUCCI, AS
MEMBERS OF THE BOARD OF ALDERMEN OF THE CITY OF EVERETT,

Defendants, Appellees.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Douglas P. Woodlock, U.S. District Judge]

Before

Selya, Lynch, and Lipez, Circuit Judges.

Isaac H. Peres, with whom Ghioldi & Peres was on brief, for
appellant.
John J. Cloherty, III, with whom John J. Davis and Pierce, Davis
& Perritano were on brief, for appellees.

April 5, 2001
 LYNCH, Circuit Judge. Gary Collins was once a used car

dealer, operating a lot called The Car Place along the Revere

Beach Parkway in Everett, Massachusetts. He did so by grace of

a license from Everett's Board of Aldermen. Collins fell out of

grace, having repeatedly violated the terms of his license, and

his relationship with the Board was marked by acrimony and

litigation. The Board in 1996 denied his application for a new

annual license. Collins thought the Board was retaliating for

his having sued them. To make matters worse in Collins's eyes,

the new licensee who operated on Collins's old site was given

more generous license terms.

Collins responded by filing this § 1983 suit against

the Board in late 1996. The complaint alleged that the Board

denied Collins's application arbitrarily and maliciously, partly

in retaliation for his lawsuit, depriving him of his

constitutional rights. One Board member, David Ravanesi, was

singled out as having particular personal animosity against

Collins and as having defamed him. In 1992 Collins heard that

someone, he suspected Ravanesi, was spreading the word that

Collins sold more than cars at the lot and Collins,

understandably, did not like the suggestion he was selling

drugs. Thus, he amended his complaint in 1997 to add a state

law claim for defamation against Ravanesi.

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 Invoking the stringent standards for substantive due

process and equal protection claims against public officials for

denying licenses, the district court concluded that Collins's

evidence did not meet the mark. The court reached the same

conclusion on the retaliation claim. The court also concluded

that Collins should have acted sooner on the defamation claims

in light of the applicable statute of limitations, and rejected

Collins's claim that the discovery rule excused his late filing.

Summary judgment was entered against Collins. He appeals. The

civil rights claims are easily disposed of, and we affirm.

Application of the statute of limitations to the defamation

claim in light of the discovery rule presents a closer question.

I.

On review of a grant of summary judgment, we "consider

the facts in the light most favorable to the nonmoving party,

drawing all reasonable inferences in that party's favor."

Thomas v. Eastman Kodak, 183 F.3d 38, 42 (1st Cir. 1999), cert.

denied, 528 U.S. 1161 (2000).

The Massachusetts statute governing licenses for

dealing in used automobiles provides that the licensing

authorities of cities and towns "may grant" a license to a

"proper person" to engage in the motor vehicle business if that

"business is or will be his principal business" and he "has

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available a place of business suitable for the purpose." Mass.

Gen. Laws ch. 140, § 59. Licenses expire after one year. See

id. Section 59 also provides that "[a]ny person aggrieved by

any action of the licensing board" may appeal to a Massachusetts

superior court within ten days of an adverse action. Id. The

City of Everett has designated its Board of Aldermen to serve as

its licensing authority under § 59.

In 1991, Collins first obtained a used car dealer's

license from the Everett Board of Aldermen, permitting him to

operate a lot in Everett. The license limited the lot to having

fifteen cars for sale at one time. Collins's lot was called The

Car Place. In late 1991, Alderman David Ravanesi became

concerned that Collins was exceeding the fifteen car limit and,

along with the Everett police, inspected Collins's dealership

from time to time. A Massachusetts statute authorizes the Board

to inspect licensees such as Collins for compliance with the

license terms. Mass. Gen. Laws ch. 140, § 66. The number of

vehicles on Collins's lot at various times ranged from twenty-

two to fifty-two, according to Everett police reports. Collins

was called before the Board in December 1991 about his non-

compliance with the terms of his license. At about the same

time, several other used car dealers also were haled before the

Board to answer for license violations.

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 In 1992, Collins applied to have his license renewed.

The Board referred his application to an investigative

committee, which monitored Collins's compliance. At a Board

hearing on August 24, 1992, Ravanesi voiced his concern about

the excessive number of cars on Collins's lot, and called

Collins a "liar." Alderman Frank Nuzzo expressed interest in

the possibility of a different business occupying Collins's lot,

and Alderman David Ragucci criticized Collins for not "giving to

the community." The seven member Board, by unanimous vote,

denied Collins's application for several reasons, most of them

related to his failure to comply with the license restrictions.

Collins appealed the denial and obtained a state court

injunction preventing the City from issuing a cease and desist

order against him, the usual aftermath of a denial of a license

renewal. The injunction, which remained in force between 1992

and 1996, required Collins to comply with the fifteen car limit

while the litigation was pending. The Board continued to

monitor Collins and documented several additional violations.

The relationship between Collins and the Board remained

publicly contentious. At Board meetings, some of the Aldermen

discussed their frustration over the injunction and Collins's

persistent violations of the license terms. Their comments were

sometimes reported in the local newspaper. Ravanesi described

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the injunction as "preventing us from enforcing the rules and

ordinances of this city" and stated that he was "sick and tired

of watching this guy flaunt the law." Ravanesi later stated

that he "[didn't] know of a sane judge who would issue such an

order" and that he "want[ed] some action." Alderman Jeanne

Cristiano expressed her displeasure over a letter Collins had

written to the Board accusing it of being influenced by

Ravanesi's personal animus toward Collins. Collins, too, voiced

his displeasure over the situation and made some statements to

the local paper.

In 1992, Collins learned from his attorney that someone

was spreading rumors that Collins was selling "more than just

cars" from his lot, statements which Collins took to mean that

he was selling drugs from the lot. Collins suspected at the

time that the statements were attributable to Ravanesi.

Collins interacted with Ravanesi occasionally at Board

meetings and when Ravanesi visited his business. Collins also

listened to two telephone conversations between Collins's

attorney and Ravanesi. Collins never heard Ravanesi state that

he disliked Collins or wanted to drive him out of business. At

a meeting between Collins and Ravanesi arranged by Collins's

attorney, Ravanesi told Collins he would vote in favor of

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Collins's license application if Collins complied with the

license terms.

In 1995, the Massachusetts Superior Court, finding that

Collins had exceeded the fifteen car limit imposed by his

license, upheld as appropriate the Board's 1992 non-renewal of

Collins's license, and dissolved the injunction. The

Massachusetts Appeals Court affirmed, and the Supreme Judicial

Court denied further appellate review in 1996. Collins v. Board

of Aldermen, 664 N.E.2d 883 (Mass. App. Ct.), further review

denied, 667 N.E.2d 1158 (Mass. 1996). The City of Everett then

ordered Collins to cease conducting business as of July 31,

1996. This prompted Collins to file a new application for a

used car dealer license. On October 15, 1996, the Board

unanimously denied Collins's application for eleven reasons,

including Collins's history of non-compliance and procedural

rules requiring Collins to wait at least one year after a

license denial before reapplying.

In November, 1996, the Board granted a license to

another used car dealer, John's Auto Sales, Inc., to operate at

the location formerly occupied by Collins's lot. John's license

imposed an eighteen car limit, a three car increase from the

restriction in Collins's license. The limit was later

increased, in September 1997, to twenty-six.

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 In June 1997, Richard Barry, whom Collins previously

did not know, told Collins that it was in fact Ravanesi who had

made statements in 1991 accusing Collins of "selling more than

cars out of that place," and that Ravanesi had also said that

"everybody in the joint is a 'cokehead.'" Barry also reported

Ravanesi as stating his intention to "boot him [Collins] right

out of this City" and to "stomp him right out of business and

bury him."1

II.

Our analysis starts with the claims on which federal

jurisdiction is based. We review de novo the district court's

grant of summary judgment. Thomas, 183 F.3d at 47. Summary

judgment is appropriate "if the pleadings, depositions, answers

to interrogatories, and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to

any material fact and that the moving party is entitled to a

judgment as a matter of law." Id. (quoting Fed. R. Civ. P.

56(c)).

A. Constitutional Claims under Section 1983

To sustain an action under 42 U.S.C. § 1983, Collins

must show both: "(i) that the conduct complained of has been

1 Ravanesi denies making these statements and also denies
making any statements suggesting Collins sold drugs from his car lot.

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committed under color of state law, and (ii) that this conduct

worked a denial of rights secured by the Constitution or laws of

the United States." Chongris v. Board of Appeals, 811 F.2d 36,

40 (1st Cir. 1987). It is undisputed that the first prong is

met in this case. The real work for Collins is to demonstrate

that the Board's denial of his license application deprived him

of his constitutional rights. That in turn depends on the

standards required to make out his particular claims of

constitutional right.

1. Substantive Due Process and Equal Protection

In cases of denial of a local license or permit, the

standard for determining whether government conduct constitutes

either a substantive due process or an equal protection

violation "is so similar as to compress the inquiries into one."

Baker v. Coxe, 230 F.3d 470, 474 (1st Cir. 2000). We analyze

those claims together.

To establish a substantive due process claim, a

plaintiff must demonstrate an "abuse of government power that

shocks the conscience" or "action that is legally irrational in

that it is not sufficiently keyed to any legitimate state

interests." PFZ Properties, Inc. v. Rodriguez, 928 F.2d 28, 31-

32 (1st Cir. 1991). Where a license or permit denial is

involved, the class of cases which meets the constitutional

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threshold is narrowly limited. See Baker, 230 F.3d at 474; PFZ

Proper t i e s, 928 F.2d at 31-32.

In Nestor Colon Medina & Sucesores, Inc. v. Custodio,

964 F.2d 32 (1st Cir. 1992), this court held that the denial of

a land use permit, even if arbitrary, did not constitute a

substantive due process violation unless it was a "truly

horrendous situation[]." Id. at 45. Similarly, we rejected a

plaintiff's substantive due process claim where a regulatory

board revoked his surveyor's license, allegedly due to the

chairman's animus toward him, finding that the plaintiff failed

to show that the treatment was "shocking or violative of

universal standards of decency." Amsden v. Moran, 904 F.2d 748,

757 (1st Cir. 1990). This unforgiving standard guards against

"insinuat[ing] the oversight and discretion of federal judges

into areas traditionally reserved for state and local

tribunals." Nestor Colon, 964 F.2d at 45.

Collins's statements that Ravanesi's animus drove the

Board to deny Collins a license fall far short of establishing

the type of "horrendous situation" for which Nestor Colon left

the door to federal relief "slightly ajar." Id. While the

record certainly establishes that Collins's relationship with

the Board, and especially with Ravanesi, was contentious, the

record also shows that Collins repeatedly violated the fifteen

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car limit imposed by his license, starting in the first year it

issued. That alone means the Board's action is far from legally

irrational.

Moreover, there is no evidence that the rest of the

Board shared Ravanesi's alleged animus or was motivated by it.

Of the seven members, four were silent on the issue of Collins's

license application; two others made a few bland references to

the situation. Even if Ravanesi were ill-motivated, one

member's bad motive is not imputed to a legislative body for §

1983 liability unless plaintiff shows "both (a) bad motive on

the part of at least a significant bloc of legislators, and (b)

circumstances suggesting the probable complicity of others."

Scott-Harris v. City of Fall River, 134 F.3d 427, 438 (1st Cir.

1997), rev'd on other grounds sub nom., Bogan v. Scott-Harris,

523 U.S. 44 (1998). Collins has shown neither.

Thus, Collins has failed to show that the Board's

denial of his license involved any misconduct, let alone the

kind of conscience-shocking abuse of governmental power required

for showing a substantive due process violation. PFZ

Properties, 928 F.2d at 31-32.

Nor has Collins shown any denial of equal protection.

An equal protection claim is found only upon a showing of a

"gross abuse of power, invidious discrimination, or

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fundamentally unfair procedures" or some sort of unjustified

disparate treatment with respect to similarly situated

applicants. Creative Environments, Inc. v. Estabrook, 680 F.2d

822, 832 n.9 (1st Cir. 1982). Indeed, we have warned that "[i]f

disgruntled permit applicants could create constitutional claims

merely by alleging that they were treated differently from a

similarly situated applicant, the correctness of virtually any

state permit denial would become subject to litigation in

federal court." Nestor Colon, 964 F.2d at 44-45.

Collins's assertion that he was treated differently

than the successor to his license, John's Auto Sales, is flawed

not only because the alleged differential treatment is not

nearly grave enough to trigger constitutional concern, but also

because Collins has not demonstrated that John's was similarly

situated to his own business. It is true that John's received

a license allowing it to sell up to eighteen used cars, a three

car increase from Collins's fifteen car limit. But there is no

evidence that the new license recipient had engaged in four

years of license violations, as Collins undisputably did, and so

Collins cannot say that he and the new licensee were so

similarly situated that giving them different limits violated

Collins's equal protection rights.

2. Retaliation

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 Collins also claims that the Board denied his 1996

license application in retaliation for exercising his right to

appeal from the Board's 1992 decision not to renew his license.2

Collins must show that the Board's intent to retaliate against

him for exercising his constitutionally protected rights was a

"substantial factor" motivating the Board's adverse decision.

See Pontarelli v. Stone, 930 F.2d 104, 115 (1st Cir. 1991).

There is no evidence of retaliation. The statements attributed

to Ravanesi were in 1991, before Collins filed a lawsuit. The

city officials expressed irritation over being sued. That is

not enough to show retaliation. The Board in 1996 gave eleven

reasons why it would not renew Collins's license, all legitimate

on their face.

But even if Collins could show that his appeal provided

the impetus for the Board's decision (a dubious proposition),

his claim of unconstitutional retaliation still fails if the

Board demonstrates "that it would have reached the same decision

even in the absence of the protected conduct." Wytrwal v. Saco

Sch. Bd., 70 F.3d 165, 170 (1st Cir. 1995), quoting Mt. Healthy

2 Although Collins does not plead his retaliation claim as
such, we treat it as an ordinary claim of unconstitutional retaliation
for protected speech in violation of the First Amendment. See Nestor
Colon, 964 F.2d at 40-41 (denial of land use permit in retaliation for
applicant's protected political expression is a First Amendment
violation).

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Bd. of Educ. v. Doyle, 429 U.S. 274, 287 (1977). There is no

evidence from which to conclude that the Board would have

reached a different decision.

Collins argues that the district court should have

allowed a jury to decide whether his license violations were a

pretext for the real motive -- retaliation -- behind the Board's

denial of his license. He relies on Putnam Resources v.

Pateman, 958 F.2d 448 (1st Cir. 1992), for the proposition that

causation writ large is normally a question reserved for the

fact-finder. From that, Collins argues that the district court

improperly resolved the question whether Ravanesi's conduct was

the "proximate cause" for the denial of Collins's license

application. But these arguments suffer serious flaws. On

summary judgment, Collins does not have enough evidence to get

to a jury on retaliation, much less to overcome the Board’s

defense that it would have reached the same conclusion

regardless. The arguments are simply an end-run around the rule

just stated, that the Board "still prevails by showing that it

would have reached the same decision in the absence of the

protected conduct." Crawford-El v. Britton, 523 U.S. 574, 593

(1998). Despite Collins's efforts to minimize them, the

documented incidents of his license violations are legion, and

provide ample basis for the Board's denial of his license.

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 In a final effort, Collins makes much of the fact that

the district court found that Collins was barred from seeking a

license in 1996 under the Board's and the City's procedural

rules, and this was an independent reason to deny the license.

Those rules impose waiting periods that prohibit an applicant

denied a license from reapplying for the same license for at

least one year. The district court found the SJC's 1996 ruling

on the 1992 license denial by the Board to be the triggering

date of denial. Collins argues that the denial did not take

place in 1996, but in 1992, when his renewal license was first

denied by the Board, and so the procedural bar was not a

legitimate ground for denying his license application in 1996.

But the district court's conclusion that the denial occurred in

1996, for the purpose of measuring the waiting period, is an

eminently reasonable construction of the rules, providing

another ground for rejecting Collins's retaliation claim.3

B. Defamation

Collins also argues that the district court erred in

finding his 1997 defamation claim barred by the three-year

statute of limitations. Mass. Gen. Laws ch. 260, § 4. Collins

3 Because we agree with the district court's disposition of
Collins's constitutional claims on the merits, we need not reach
defendants' arguments based on the defenses of immunity and lack of
municipal liability.

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argues he did not know who made the defamatory statements (made

in 1991) until 1997 and so he falls within the discovery

exception to the statute of limitations. The parties do not

dispute that the statements allegedly made by Ravanesi in 1991

-- statements suggesting that Collins was selling drugs out of

his used car dealership -- are defamatory. What is in dispute

is whether the discovery rule permits Collins to avoid the

statute of limitations bar. The burden is on the plaintiff to

show facts sufficient to take the case out of the statute of

limitations.

The general rule in libel and defamation cases is that

the cause of action accrues, and the statutory period begins to

run, on the date of publication. Flynn v. Associated Press, 519

N.E.2d 1304, 1307 (Mass. 1988). Here, Ravanesi allegedly made

the defamatory statements in 1991, and in 1992, Collins's

attorney told Collins that someone had said he was selling "more

than cars" on his lot. At the time, Collins took that statement

to mean that he was selling drugs and attributed it to Ravanesi

based on their ongoing dispute. Collins argues that the statute

of limitations did not begin to run on his defamation claim

until he learned the specific details of the statement and

confirmed the identity of the speaker in 1997, when Barry told

Collins that Ravanesi had, in 1991, said that he knew Collins

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"was selling more than cars out of that place because everybody

in the joint is a 'cokehead.'"

Under Massachusetts law, the discovery rule suspends

the running of the statute of limitations where a cause of

action is based on an "inherently unknowable" wrong; the statute

only starts to run when "the harm becomes known, or in the

exercise of reasonable diligence should have become known, to

the injured party." Catrone v. Thoroughbred Racing Ass'n, 929

F.2d 881, 885 (1st Cir. 1991). A plaintiff need not have notice

of "every fact which must eventually be proved in support of the

claim . . .. Rather, notice is simply knowledge that an injury

has occurred." Flynn, 519 N.E.2d at 1307 (internal quotation

marks omitted).

The Supreme Judicial Court has applied the discovery

rule strictly in defamation cases. In Flynn, supra, it held

that plaintiff's cause of action was not "inherently unknowable"

where the alleged libel was printed in a newspaper widely

available to the public, even though the plaintiff did not learn

of the article until three years later. Here, by contrast, the

defamatory statement was not published in a newspaper of general

circulation. Rather, it was allegedly made by Ravenesi while at

another used car business. And so, like the district court, we

will assume the accrual date was in 1992 when Collins first had

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knowledge that the statement was made and thus that he was

injured.

Thus, this is a situation where a plaintiff has notice

of an injury (defamation) and generally what was said but does

not know for certain who made the defamatory statement. It

differs from the situation in Catrone, supra, where plaintiff

knew generally of the statements and who published them, but did

not know their particular content. As a result, this case does

not easily fit within the Massachusetts rule followed in Catrone

that "[t]he 'notice' required is not notice of every fact which

must eventually be proved . . .. These details are properly the

subject of requests for discovery once an action is filed."

Catrone, 929 F.2d at 886 (quoting White, 434 N.E.2d at 1020-21).

In the end, we think it better to let the Massachusetts courts

decide this issue. The federal claims have been dismissed, and

we think the better part of discretion is to have the dismissal

of the state claim be without prejudice. See Houlton Citizens

Coalition v. Town of Houlton, 175 F.3d 178, 192 (1st Cir. 1999).

III.

We affirm the district court's grant of summary

judgment in favor of defendants on all of Collins's claims,

except that the district court is directed to enter judgment of

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dismissal without prejudice as to the pendent state defamation

claim.

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