ALJDEC decisions subject to certification as final

09A-0019-LIQ · Liquor Licenses and Control · 2010-02-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 5 and 6, 2010, with record held open for submission of written closing arguments APPEARANCES: Attorney Richard J. Hertzberg for Metropolitan Bush, Co.; Assistant Attorney General Camila Alarcon for the Department of Liquor Licenses and Control ADMINISTRATIVE LAW JUDGE: Thomas Shedden _____________________________________________________________________ FINDINGS OF FACT On September 25, 2009, the Arizona Department of Liquor Licenses and Control (the “Department”) issued a Complaint and Notice of Hearing in this matter alleging that Metropolitan Bush Co. (the “licensee”) committed three violations of the state liquor laws. The Complaint alleged that: COUNT 1

On or about August 13, 2008 at approximately 2:07 a.m., Steven Easley, an employee of the licensee, failed to take reasonable steps to protect the safety of a patron entering, leaving and/or remaining on the licensed premises when the licensee knew or should have known of the danger to such person, in that Steven Easley, an employee of the licensee, placed Christopher Aranda, a patron in an arm bar hold and escorted Mr. Aranda to a major roadway and released him where, Mr. Aranda was struck by an eastbound vehicle causing serious physical bodily injury, in violation of A.R.S. § 4-210(A)(10).

COUNT 2

On or about August 22, 2008 at approximately 11:10 p.m., Karon Graves, an employee of the licensee, failed to take reasonable steps to protect the safety of a patron entering, leaving and/or remaining on the licensed premises when the licensee knew or should have known of the danger to such person, in that Karon Graves, an employee of the licensee, struck a patron, Lorenzo Luna Sepulveda, causing serious physical bodily injury, in violation of A.R.S. § 4-210(A)(10).

COUNT 3

The licensee has failed to satisfactorily maintain the capability, qualifications and reliability requirements for a license as prescribed by A.R.S. Sections 4-202 and 4-203, in that the licensee failed to take reasonable steps to protect to protect the safety of a patron when one it its employees struck a patron in the head, and when one of its employees placed another patron in an arm bar hold and escorted him to and released him onto a major roadway, where he was struck by a vehicle, in violation of A.R.S. § 4-210(A)(2).

The Notice of Hearing set the matter for January 5 and 6, 2010, at the Office of Administrative Hearings. The licensee operates Pantera Show Club (“Pantera”) at 4139 West Indian School Road, in Phoenix. Pantera is what is commonly referred to as a “topless” bar or club. Mr. Frank Zanzucchi, one of the licensee’s owners, testified that the licensee owns three other topless clubs located in Phoenix. The licensee has owned Pantera for about six years. The licensee pays APEX Security to provide security outside Pantera and the other clubs it owns. Steven Easley was employed by APEX. Both Mr. Easley and APEX are licensed by the state. Mr. Zanzucchi testified that to his knowledge, the licensee is the only topless club in Phoenix that has hired security for outside the building. Pantera’s policy is to verify that all patrons entering the club are screened for weapons using a magnetic wand. Pantera also forbids entry to those wearing anything that could be construed as gang related. According to Mr. Zanzucchi’s testimony, the Phoenix Police Department considers the area in which Pantera is located to be one of the most violent and roughest areas in Phoenix. Mr. Zanzucchi has instructed the licensee’s employees to fully cooperate with Department and Police during any investigation. COUNT 1 Antonio Ribera, a special investigator employed by the Department, investigated the incident that gives rise to Count 1. At times, Officer Ribera was assisted by Investigator Robert Dorn. See Exhibits 1 (Officer Ribera’s Report) and 10 (summaries of interviews conducted by Officer Ribera), and Exhibit 2 (Officer Dorn’s report). Officer Ribera’s investigation was concerned with determining whether or not the licensee had violated the state’s liquor laws. Officer Ribera investigated whether or not Christopher Aranda was clearly intoxicated when he was served by Pantera and whether or not Pantera failed to adequately protect the safety of Mr. Aranda, a patron of the licensee. In the instant matter the Department did not allege that Pantera had served Mr. Aranda at a time when he was clearly intoxicated. The Phoenix Police Department investigated the matter because it involved a traffic accident, with its investigation focused on the traffic accident, rather than the state’s liquor laws. See Exhibit D (public version of Detective Robert Pitts’s report) and Exhibit 20 (follow-up information). Although Officer Ribera talked to Det. Pitts on the day of the incident, prior to the hearing he had not read Det. Pitts’s report. Det. Pitts’s report contains summaries of interviews with two eye-witnesses to the incident, Ms. Peggy Freese and Mr. Levente Gabor. Officer Ribera acknowledged that prior to the hearing he was not aware that these two eye- witnesses existed, although he had been informed by the Department’s attorney that there might be eye-witnesses. Exhibits 17 and E are three computer discs that contain surveillance video of Mr. Aranda both inside and outside Pantera. The video was downloaded from computer hard drives taken from Pantera. At the Department’s request, the Arizona Department of Public Safety manipulated the some of the original video images to slow these images down to “real time.” Mr. Aranda arrived at Pantera on August 13, 2008, a few minutes after midnight (on August 12). Mr. Aranda’s friends left the bar at about 1:30 a.m., at which time they asked Pantera employee Richard Vlasak to make Mr. Aranda leave with them. Mr. Vlasak informed the friends that he could not force Mr. Aranda to leave. The friends then asked that Mr. Vlasak make sure that Mr. Aranda got a ride or a taxi, to which Mr. Vlasak agreed. See Exhibit 10. Some information shows that Mr. Aranda’s friends intended to return to Pantera to pick him up in a black “hummer.” Pantera closed at 2:00 a.m. at which time Mr. Aranda exited the bar. Pantera’s policy is to require all patrons to clear the parking lot at closing. The policy is in effect to protect the dancers and other employees. The Department is not alleging that this policy is inappropriate. Mr. Aranda was standing in front of the bar when he was approached by Karl Beaman, an employee of Pantera. Mr. Beaman told Mr. Aranda that he had to leave the property and Mr. Beaman offered to call a taxi for him. Mr. Aranda said “Fuck you” to Mr. Beaman and told Mr. Beaman that he was not leaving. See Exhibit 10 (at Officer Ribera’s interview with Mr. Beaman). Mr. Easley then approached Mr. Aranda and told him he had to leave the parking lot. According to Mr. Beaman, Mr. Aranda also told Mr. Easley “Fuck you” and Mr. Easley then placed Mr. Aranda in an arm lock and escorted Mr. Aranda to the sidewalk at Indian School Road. See Exhibit 10 (at Officer Ribera’s interview with Mr. Beaman). Mr. Beaman saw Mr. Aranda fight back against Mr. Easley and “Aranda broke loose and [he] fell into the street on his lower back and butt” where he was immediately run over. See Exhibit 10 (at Officer Ribera’s interview with Mr. Beaman). Mr. Beaman told Det. Pitts that: he asked Mr. Aranda if he needed a cab or if they could call his friends; when Mr. Aranda refused both offers, Mr. Beaman told Mr. Aranda he had to leave the property; Mr. Aranda cursed at him; Mr. Easley then contacted Mr. Aranda and asked him to leave; Mr. Aranda then began cursing at Mr. Easley; Mr. Easley placed Mr. Aranda in an arm lock and began to move him towards the sidewalk; Mr. Aranda struggled the entire way and was fighting with Mr. Easley just before he fell into the street. See Exhibit D (at Det. Pitts’s interview with Mr. Beaman). Ms. Freese was in her car waiting to pick up her daughter who worked at Pantera and witnessed the incident. Ms. Freese testified that Mr. Easley was escorting Mr. Aranda toward the sidewalk and Mr. Aranda was yelling and struggling. Mr. Aranda broke free and fell into the street where he was hit by the car. Ms. Freese provided credible testimony that Mr. Easley did not push or place Mr. Aranda into the street. Ms. Freese had been interviewed by Det. Pitts, whose report is consistent with Ms. Freese’s testimony at the hearing. See Exhibit D. Mr. Gabor was a doorman employed by the licensee. According to Det. Pitts’s report: Mr. Gabor saw Mr. Easley contact Mr. Aranda and ask him to leave several times, but Mr. Aranda refused; Mr. Easley grabbed Mr. Aranda and moved him off the property toward the sidewalk at Indian School Road; Mr. Gabor heard people struggling and looked back to see Mr. Aranda struggling with Mr. Easley; Mr. Aranda fell into the street; Mr. Easley tried to grab him but was not able to do so before Mr. Aranda was hit by a car. See Exhibit D (at Det. Pitts’s interview with Mr. Gabor). Mr. Easley did not appear and testify, but he was interviewed by Det. Pitts, Officer Ribera and Officer Dorn, and he provided a written statement. See Exhibits D, 10, 2, and 7 (Mr. Easley’s written statement). According to the statements Mr. Easley gave, Mr. Aranda was wet with perspiration, which led to Mr. Easley losing his grip on Mr. Aranda’s arm, but the accounts of Mr. Easley’s interviews are not entirely consistent. Det. Pitts wrote that Mr. Easley stated that he lost control of Mr. Aranda when they were about even with a large sign and that Mr. Aranda backed toward the street before he fell. See Exhibit D. Officers Ribera and Dorn wrote that Mr. Easley stated that Mr. Aranda broke free at the sign and then ran toward the street, tripped on a utility box and then fell. See Exhibits 10 and 2. The video of the incident does not show that Mr. Aranda broke free and ran toward the road. It is not clear from the video whether or not Mr. Easley maintained control of Mr. Aranda throughout their encounter. Mr. Easley, Mr. Gabor, Mr. Beaman, and Ms. Freese all reported that Mr. Aranda appeared intoxicated. Officer Ribera obtained a hospital report showing that after the accident Mr. Aranda had a blood alcohol content of 0.323%. Mr. Aranda suffered severe injuries as a result of being hit by the car. In Officer Ribera’s report, which was written before he had read Det. Pitts’s Report or had heard Ms. Freese testify, Officer Ribera wrote that Mr. Easley “plac[ed] Aranda, an intoxicated customer, in moving vehicular traffic.” See Exhibit 2. After he heard Ms. Freese testify and was made aware of Mr. Gabor’s statements to Det. Pitts, Officer Ribera was asked if he was still of the opinion that Mr. Easley had placed Mr. Aranda in traffic. Initially Officer Ribera responded that Mr. Easley had placed Mr. Aranda in harms-way by moving toward the road, but then Officer Ribera testified that it was still his opinion that Mr. Easley had placed Mr. Aranda in the roadway. Officer Ribera interviewed Mr. Aranda on September 9, 2008, but Mr. Aranda told him that he had no recollection of the events at issue. Mr. Zanzucchi testified that he had conducted his own investigation of the matter and that he is of the opinion that Mr. Easley did not place Mr. Aranda into the street. Ms. Zanzucchi based his conclusion on discussions with Mr. Easley and some of the witnesses to the incident, the Phoenix Police Department’s report, and his review of the video. Mr. Zanzucchi testified that APEX’s policy was to hold intoxicated patrons until their ride arrived or to call them a taxi. Mr. Zanzucchi had never heard of an incident in which APEX left an intoxicated patron in the street. Mr. Zanzucchi testified that he did not believe it was an error for APEX or Mr. Easley to deal with Mr. Aranda as opposed to calling the Phoenix Police. There was a time when the licensee did call the Phoenix Police for minor incidents, but Mr. Zanzucchi was informed by the Department that Pantera was being considered a nuisance club and that the Police had priorities other than fights or disorderly patrons. Consequently, the licensee instructed APEX to handle such matters. In the three years that APEX has been handling security for the licensee, there have been no other similar incidents and there have been no reports showing that Mr. Easley was abusive to anyone. Count 2 On August 22, 2008, Lorenzo Luna Sepulveda was present in Pantera. Ms. Melissa Kuhn is employed by the licensee as a manager. Ms. Kuhn testified that Mr. Sepulveda had been to Pantera before and was usually respectful, but on the night in question his behavior was erratic and he was throwing things. Ms. Kuhn’s opinion is that Mr. Sepulveda was on drugs. Consequently, Ms. Kuhn requested that the staff have Mr. Sepulveda removed from the premises. Mr. Sepulveda was being escorted out of the premises by several employees including Mr. Karon Graves when he spit in Mr. Graves’s face. Several other employees got between Mr. Sepulveda and Mr. Graves. About five or six seconds after Mr. Sepulveda spit on Mr. Graves, Mr. Graves punched Mr. Sepulveda, who fell and struck his head. See Exhibit 18 (Phoenix Police Department report). Ms. Kuhn testified that for three years the licensee has had a “no-hit” policy under which any employee who strikes a patron is fired. Mr. Graves had been provided a written copy of the licensee’s policies that he was required to sign and the licensee regularly reiterated its policies, including the no-hit policy, to its employees. Consequently, Mr. Graves was aware of the no-hit policy. Mr. Graves was fired the next day, which was as soon as proper procedures for terminating an employee could be completed. According to Ms. Kuhn, Mr. Graves had been a good employee, but under the policy that does not matter. Mr. Zanzucchi also testified that Mr. Graves was a good employee and that he was aware that Mr. Graves had been spit upon before he punched Mr. Sepulveda, but, based on the licensee’s policy, that did not matter and so Mr. Graves was fired. After Mr. Sepulveda was struck by Mr. Graves, it was determined that while in the restroom, Mr. Sepulveda approached Mr. Chris Schneider, who is employed by the licensee, and asked if Mr. Schneider had any narcotics for sale. Mr. Schneider reported the incident in order to have Mr. Sepulveda removed from the premises, but Mr. Sepulveda could not be located, apparently because he had changed his shirt. Count 3 The Department presented no independent evidence with respect to Count 3. CONCLUSIONS OF LAW The Department bears the burden of persuasion. See A.R.S. § 41-1092.07(G).

The standard of proof on all issues is that of the preponderance of the evidence. See A.A.C. R2-19-119. A preponderance of the evidence is “[e]vidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary 1182 (6th ed. 1990). A.R.S. § 4-210(A) provides: After notice and hearing, the director may suspend, revoke or refuse to renew any license issued pursuant to this chapter for any of the following reasons: * * * * 2. The licensee fails to satisfactorily maintain the capability, qualifications and reliability requirements of an applicant for a license prescribed in section 4-202 or 4-203. * * * * 10. The licensee fails to take reasonable steps to protect the safety of a customer of the licensee entering, leaving or remaining on the licensed premises when the licensee knew or reasonably should have known of the danger to such person, or the licensee fails to take reasonable steps to intervene by notifying law enforcement officials or otherwise to prevent or break up an act of violence or an altercation occurring on the licensed premises or immediately adjacent to the premises when the licensee knew or reasonably should have known of such acts of violence or altercations.

Count 1 In Count 1 the Department alleges that the licensee violated A.R.S. § 4- 210(A)(10) because Mr. Easley “escorted Mr. Aranda to a major roadway and released him, where Mr. Aranda was struck by a vehicle….” In its Closing Memorandum, the Department argues that whether Mr. Easley pushed Mr. Aranda “onto oncoming traffic or whether [Mr. Aranda] escaped” from Mr. Easley is not determinative of whether or not a violation occurred, and “a violation does not depend on whether Mr. Easley threw Mr. Aranda into the street, but whether [Mr. Easley] compromised [Mr. Aranda’s] safety.” The Department then concludes that a violation occurred because Mr. Easley escorted Mr. Aranda “onto or close to a major roadway....” The scope of the hearing is limited to issues set forth in the Notice of Hearing. See A.R.S. § 41-1092.07(F)(6). Consequently, there is no basis on which to consider whether or not a violation occurred merely because Mr. Easley escorted Mr. Aranda too close to the roadway. However, to the extent that this issue should be considered, the Department has not met the burden of persuasion. The Department asserts that Mr. Aranda should have been escorted off the property onto the neighboring businesses. But the Department presents no substantial evidence showing that it would have been reasonable or safe to move Mr. Aranda onto these neighboring properties, where according to the licensee, other customers and employees were present. Consequently, there is insufficient evidence to show that Mr. Easley could have safely moved Mr. Aranda to the neighboring properties. The only evidence to show that Mr. Easley placed or threw Mr. Aranda into the street is the testimony of Officer Ribera, which was based on his review of the video. But this testimony can be given no appreciable weight because the video does not show that Mr. Easley placed or threw Mr. Aranda into the road and Officer Ribera’s testimony is not consistent with Ms. Freese’s eye-witness testimony or the accounts of the incident provided by Mr. Beaman and Mr. Gabor. The preponderance of the evidence does not show that Mr. Easley released Mr. Aranda, but rather that Mr. Aranda was struggling and fighting against Mr. Easley when he pulled free and fell into the roadway. This evidence included the eye-witness testimony of Ms. Freese, Det. Pitts’s report of his interviews with Mr. Beaman and Mr. Gabor, and Officer Ribera’s report of his interview with Mr. Beaman. Consequently, the Department has not met the burden of persuasion to show that the licensee committed the violation alleged in Count 1. Count 2 In Count 2 the Department alleges the licensee violated A.R.S. § 4- 210(A)(10) because Mr. Graves struck Mr. Sepulveda. There is no dispute that this did occur. However, the statute requires only that a license take reasonable steps to protect a customer, and the Department presented no evidence to show that there was a reasonable way for the licensee to protect Mr. Sepulveda from Mr. Graves’s reaction to being spit upon. Under the statute, Mr. Graves’s actions are imputed to the licensee, but to hold the licensee accountable in the instant matter would require reading the word “reasonable” out of the statute. The preponderance of the evidence shows that Mr. Graves’s act was a reaction to being spit upon and that his act was in violation of the licensee’s “no-hit” policy. The Administrative Law Judge concludes that the licensee could not have taken any reasonable any action to prevent Mr. Graves from striking Mr. Sepulveda, which was an unforeseeable, spontaneous incident. Consequently, the Department has not met the burden of persuasion to show that the licensee committed the violation alleged in Count 2. Count 3 In Count 3, the Department alleges that the licensee failed to satisfactorily maintain the capability, qualifications and requirements for a license based on the allegations that Mr. Graves struck Mr. Sepulveda and that Mr. Easley “escorted [Mr. Aranda] to and released him onto a major roadway….” Although Mr. Graves did strike Mr. Sepulveda, the Department did not meet its burden to show that the licensee could have taken any reasonable steps to prevent that occurrence. The preponderance of the evidence shows that Mr. Aranda fell into the roadway after struggling with Mr. Easley and escaping from Mr. Easley’s control and that Mr. Easley did not release him.

Consequently, the Department has not met the burden of persuasion to show that the licensee committed the violation alleged in Count 3. Because the Department has not met the burden of persuasion to show that the licensee committed the violations alleged in the Complaint and Notice of Hearing, this matter should be dismissed. RECOMMENDED ORDER IT IS ORDERED that the Complaint against Metropolitan Bush Co. is dismissed.

Done this day, February 9, 2010.

/s/ Thomas Shedden Thomas Shedden Administrative Law Judge

Transmitted electronically to:

Jerry Oliver, Director Arizona Department of Liquor Licenses and Control -----------------------

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826