Nathu v. City Of Oakland

Background

Tulsee Nathu, Daxa “Mina” Patel, Jayanti Nathu, II Ram 6801 I-40 West, Amarillo, TX, Ltd., and 1000 RAM Inc. sought to build a six-story, 220-room hotel on the Mandela Parkway in Oakland. They obtained an option to purchase the property for $3,010,000 and submitted a permit application to the City.

The proposed design placed one stair tower one foot from the sidewalk, rather than the 20-foot setback generally required in the applicable commercial zone. The plaintiffs requested a minor variance. The Planning Commission approved the permit and variance by a four-to-two vote, subject to a condition that the hotel pay at least $15 per hour.

Unite Here, Local 2850 opposed the project. It argued that the plaintiffs’ environmental analysis was inadequate, that the setback variance did not meet the applicable requirements, and that the permit application did not sufficiently analyze the hotel employees’ effects on Oakland’s housing, transit, and social-service needs. The City Council ultimately adopted Resolution 88171, finding that the Planning Commission had erred regarding the variance and the required analysis, and denying the permit.

The plaintiffs sued the City. They requested a writ of mandate under California Code of Civil Procedure section 1094.5, damages under the Equal Protection and Takings Clauses, and declaratory relief. The City moved for summary judgment. The plaintiffs also moved to supplement the administrative record.

Rulings on the Administrative Record and Writ Petition

The court granted the plaintiffs’ motion to supplement the administrative record with presentations, memoranda of understanding concerning job training, and a draft, unexecuted community benefits agreement. The court found that the materials had been before the City Council to some extent and were largely cumulative of the existing record.

The court applied the substantial-evidence test to the plaintiffs’ challenge to the City Council’s land-use decision. Under that test, the court had to uphold the decision if any one of the City Council’s findings was supported by substantial evidence.

The court denied the plaintiffs’ petition for a writ of mandate. It held that substantial evidence supported the City Council’s finding that the one-foot setback variance created a special privilege unavailable to comparable property owners. The record also supported the Council’s finding that the design did not fulfill the West Oakland Plan’s street-wall objective because only a small corner of the building abutted the sidewalk. Because one supported finding was sufficient, the court did not need to uphold every reason given by the City Council.

The court also declined to consider the plaintiffs’ fair-hearing or bias theory. The plaintiffs raised that theory for the first time at oral argument and had not presented it adequately in their written opposition. The court found that the plaintiffs’ arguments about the City Council’s decision being unsupported or pretextual were disagreements with the decision’s merits, not concrete facts showing actual bias.

Constitutional Claims

The court granted the City’s motion for summary judgment on all remaining constitutional claims.

Equal Protection—Class-of-One Claim. The plaintiffs argued that Oakland treated them differently from a Hampton Inn project. The court rejected the claim because the projects were not similarly situated in all material respects. Unlike the plaintiffs, the Hampton Inn project did not require a setback variance, and its permit was never considered by the City Council. The court therefore granted summary judgment on the class-of-one equal protection claim.

Equal Protection—Municipal Liability. The plaintiffs also asserted a separate claim against Oakland based on a municipal policy or custom. The court explained that municipal-liability rules do not themselves create a constitutional violation. Because the plaintiffs did not identify an underlying equal protection violation beyond the rejected class-of-one theory, the court granted summary judgment on this claim.

Takings Clause. The plaintiffs argued that Oakland unlawfully required them to hire Unite Here or enter into a card-check neutrality agreement as a condition of receiving the permit. The court found that no reasonable factfinder could conclude that the City ordered the plaintiffs to hire the union. The plaintiffs’ own witnesses testified that City Council members wanted a card-check neutrality agreement, but did not recall them requiring the plaintiffs to hire the union. The plaintiffs also failed to explain how the card-check agreement constituted an unconstitutional property exaction or taking. The court therefore granted summary judgment for the City on the Fifth Amendment claim.

Due Process—Vagueness. The plaintiffs challenged Planning Code section 17.103.050(A)(2), which requires hotel permit proposals to consider the project’s effects on housing, public transit, and social services.

The court held that the plaintiffs’ as-applied vagueness challenge was moot because the permit denial was independently supported by the setback-variance issue. The court therefore granted summary judgment for the City on that challenge.

The court also rejected the facial vagueness challenge. It held that the plaintiffs had not shown that the provision was impermissibly vague in every application. In the court’s view, a person of ordinary intelligence would understand that the provision requires a hotel applicant to estimate how many potential employees would use Oakland’s housing, transit, and social services. The court therefore granted summary judgment for the City on the facial challenge.

Declaratory Relief and Final Disposition

The City moved for summary judgment on the plaintiffs’ declaratory-relief causes of action, Counts IV and V, as duplicative of the other requested relief. The plaintiffs did not oppose that request. The court granted summary judgment on Counts IV and V.

In conclusion, Judge Jacquelyn Scott Corley denied the plaintiffs’ petition for a writ of mandate and granted the City’s motion for summary judgment on the plaintiffs’ remaining claims. The order states that it disposes of Docket Nos. 67 and 73.