Davken, Inc. v. City of Daytona Beach Shores

FILED
U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
FEBRUARY 16, 2010
JOHN LEY
CLERK
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 08-14474
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D. C. Docket No. 04-00207-CV-ORL-19-DAB
DAVKEN, INC.,
a corporation organized under the
laws of the State of Indiana,
Plaintiff-Appellant,
versus
CITY OF DAYTONA BEACH SHORES, FL,
a municipal corporation organized under
the laws of the State of Florida,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Middle District of Florida
_________________________
(February 16, 2010)
Before BARKETT, PRYOR and HILL, Circuit Judges.
PER CURIAM:

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Davken appeals the summary judgment in favor of the City of Daytona
Beach Shores, Florida. Davken, Inc. owns Krazy Dave’s Fireworks, a fireworks
retailer in Daytona Beach Shores, Florida, and argues that Daytona Beach Shores
City Ordinance No. 2003-24, as written and implemented, effectively bans the
retail sale of fireworks in the City and violates the constitutional rights of Davken
under the Contract Clause, U.S. Const. Art. I, § 10, and the Due Process Clause of
the Fourteenth Amendment, id. Amend. XIV. We affirm.
Ordinance No. 2003-24 requires both sellers and prospective purchasers of
fireworks to obtain a permit from the City Building/Fire Safety Division. In July
2003, City officials informed Davken that, under the Ordinance, all customers
would be required to obtain permits at the police department during normal
business hours. Most customers, upon learning of the requirement, left Krazy
Dave’s and never returned. Instead, they drove several blocks north and purchased
fireworks in Daytona Beach. Krazy Dave’s ceased doing business on August 31,
2003.
Davken filed a verified complaint that the City failed to implement the
permitting process required by the Ordinance and created a “sham” permitting
scheme that rendered worthless the building lease for Krazy Dave’s. Davken
argues that this “sham” substantially impaired its property rights protected by the
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Contract Clause and the Due Process Clause of the Fourteenth Amendment. We
disagree.
The claim of Davken under the Contract Clause fails. A regulation does not
violate the Contract Clause so long as it serves a “significant and legitimate public
purpose,” and is “[based] upon reasonable conditions and [is] of a character
appropriate to the public purpose justifying [the legislation’s] adoption.” Energy
Reserves Group v. Kan. Power & Light, 459 U.S. 400, 411–12, 103 S. Ct. 697, 705
(1983) (alternations in original) (internal quotation marks omitted). The City, by
enacting and implementing the Ordinance, was entitled to exercise its police
power, even if the Ordinance effected a total restraint on the existing lease for
Krazy Dave’s. See Flanigan’s Enters., Inc. of Ga. v. Fulton County, 242 F.3d 976,
989 (11th Cir. 2001); see also Keystone Bituminous Coal Ass’n v. DeBenedictis,
480 U.S. 470, 504 n.31, 107 S. Ct. 1232, 1252 n.31 (1987).
The claim of a violation of procedural due process also fails. Even if
Davken’s lease is a property interest protected by the right of procedural due
process, the City did not deprive Davken of its lease. The City instead allegedly
failed to implement a permitting process required for Davken’s customers to
purchase fireworks. Davken fails to explain how the inability of its customers to
obtain permits to purchase fireworks violates the right of procedural due process of
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Davken.
We have carefully reviewed the record and considered the written and oral
arguments of the parties. We find no reversible error. The summary judgment is
AFFIRMED.
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