# Dolly's Cafe, LLC v. Illinois Gaming Board

> District Court, N.D. Illinois · December 6, 2019

URL: https://www.frixlaw.com/law-library/cases/10141784

## Case

- **Court:** District Court, N.D. Illinois
- **Decided:** December 6, 2019
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

)
DOLLY’S CAFÉ LLC,
)

)
Plaintiff,
)

) No. 19 C 01666
v.
)

) Judge Virginia M. Kendall
ILLINOIS GAMING BOARD, et al.,
)

)
Defendants.
)
)

MEMORANDUM OPINION AND ORDER

Plaintiff Dolly’s Café, LLC, doing business as Lulu’s Place, brings this suit
pursuant to 42 U.S.C. § 1983. Plaintiff’s three-count Amended Complaint alleges
violations of the Due Process and Equal Protection clauses, along with a state law
claim for Administrative Review under 735 ILCS 5/3-101. (Dkt. 17). Plaintiff
operates a video gaming establishment and is challenging the decision of the Illinois
Gaming Board to shut down all five gaming terminals at its location. Defendants
filed the instant Motion to Dismiss for lack of subject-matter jurisdiction and failure
to state a claim. For the reasons outlined below, Defendants’ Motion is granted, and
Plaintiff’s Amended Complaint is dismissed.
BACKGROUND

Plaintiff applied to the Illinois Gaming Board for a video gaming license on
October 12, 2015. (Dkt. 17, pg. 5). After multiple visits by the Gaming Board to
Plaintiff’s premise, the Gaming Board approved Plaintiff’s license application on
November 16, 2017. (Id. at pg. 6). About one year later, Defendant Ron Jones, a
Gaming Board investigator, visited Plaintiff’s location. (Id.). Plaintiff and the
establishment immediately next door to it share a common owner. (Id. at pg. 16).

Jones informed Plaintiff that it was not allowed to own and operate adjacent
establishments which both had gaming licenses. (Id.). Later that day, the Gaming
Board shut down the video game terminals at Lulu’s Place. (Id.). The same day, the
Gaming Board provided Plaintiff with its reasoning for shutting down the gaming
terminals. (Id.). The letter read, in part:
When two or more adjacent businesses appear to the Administrator to
be a single business, or are operated by the same or commingled
ownership, then the Administrator may limit those businesses to the
maximum number of video gaming terminals. The maximum will be the
number permitted under Illinois law for one business as the total
number of video gaming terminals authorized for both or more such
businesses, where the administrator determines that the limitation
would further the intent of the Act and the integrity of video gaming in
the State of Illinois.

(Id.). The letter from the Gaming Board also informed Plaintiff that, “pursuant to
Board Rule 1800.615, [Plaintiff] may request a hearing of this determination.” (Dkt.
32, pg. 29). Further, the Gaming Board explained that any hearing challenging the
decision would “be a de novo proceeding where [Plaintiff] will have the burden of
proving by clear and convincing evidence [its] suitability to maintain 5 video gaming
terminals at each establishment.” (Id.). Plaintiff does not allege it undertook any
efforts to seek relief before the Illinois Gaming Board or in the state court system and
instead attempts to redress these purported violations at the first instance in federal
court. Plaintiff asserts it has sustained $152,684.00 in lost business revenue. (Dkt.
17, pg. 14).
Defendants first moved to dismiss Plaintiff’s Original Complaint filed March

8, 2019. (Dkt. 12). The Court entered a briefing schedule on the motion and instead
of responding, Plaintiff filed, without seeking leave, its Amended Complaint nearly a
month after its response to the motion to dismiss was due. (Dkts. 15, 17). Regardless,
the Court accepted the Amended Complaint and Defendants’ first motion to dismiss
was rendered moot. (Dkt. 21). Thereafter, Plaintiff filed a Motion to Seal and
Supplement its Amended Complaint. (Dkt. 22). The motion sought to file a sealed
Second Amended Complaint due to certain personally sensitive material contained

within. (Id.). The proposed Second Amended Complaint was contained within the
motion, not attached as a separate exhibit. (Id.). The Court granted the motion to
file a sealed Second Amended Complaint (Dkt. 23), but Plaintiff never filed the
proposed Second Amended Complaint on the docket. Because of this, Defendants
moved to dismiss the Amended Complaint—which, as the docket currently stands,
appears as the operative Complaint. Despite Plaintiff’s failure and Defendants’

excusable oversight, the confusion is of no import here. The Amended Complaint and
Second Amended Complaint are identical, with the only difference being Plaintiff’s
intent to have the latter filed under seal. Therefore, any arguments in favor of, or
opposed to, dismissal are applicable to either pleading and the outcome would be the
same regardless.
LEGAL STANDARD

In reviewing a motion to dismiss pursuant to Rule 12(b)(1) for lack of subject-
matter jurisdiction, the court must assess whether the plaintiff carried its burden of
establishing that jurisdiction is proper. Ctr. for Dermatology & Skin Cancer, Ltd. v.
Burwell, 770 F.3d 586, 588-89 (7th Cir. 2014). “Federal courts are courts of limited
jurisdiction. They possess only that power authorized by Constitution and statute,
… which is not to be expanded by judicial decree.” Kokkonen v. Guardian Life Ins.
Co., 511 U.S. 375, 377 (1994). To determine whether jurisdiction exists, the court
turns to the complaint along with evidence outside of the pleadings. Apex Digital,
Inc. v. Sears, Roebuck & Co., 572 F.3d 440, 444 (7th Cir. 2009). A court lacking

subject-matter jurisdiction must dismiss the action without proceeding to the merits.
Intec USA, LLC v. Engle, 467 F.3d 1038, 1041 (7th Cir. 2006).
To survive a motion to dismiss pursuant to Rule 12(b)(6), the complaint must
“state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007). A Rule 12(b)(6) motion is meant to challenge the legal
sufficiency of the complaint. Christiansen v. Cnty. of Boone, Ill., 483 F.3d 454, 457

(7th Cir. 2007). The Court accepts all well-pleaded allegations as true and views
them in a light most favorable to plaintiff. Appert v. Morgan Stanley Dean Witter,
Inc., 673 F.3d 609, 622 (7th Cir. 2012). Though, the Court need not accept as true
statements of law or statements that are merely conclusory and unsupported factual
allegations. McCauley v. City of Chicago, 671 F.3d 611, 616 (7th Cir. 2011). Plaintiff’s
complaint must allege facts that establish its right to relief is more than speculative.
Cochran v. Ill. State Toll Highway Auth., 828 F.3d 597, 599 (7th Cir. 2016).
“Threadbare recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

DISCUSSION

I. Proper defendants in § 1983 actions

The Eleventh Amendment serves as a bar to certain federal court actions
“against a state, state agencies, or state officials acting in their official capacities.”
Indiana Prot. & Advocacy Servs. v. Indiana Family & Soc. Servs. Admin., 603 F.3d
365, 370 (7th Cir. 2010). While exceptions do exist, suits under § 1983 are not one of
those recognized exceptions. Thomas v. Illinois, 697 F.3d 612, 613 (7th Cir. 2012)
(“[A] state and its agencies are not suable ‘persons’ within the meaning of section
1983.”).
Initially, to the extent that Plaintiff seeks to name the Illinois Gaming Board
in either of its Fourteenth Amendment claims, the Gaming Board, as a state agency,
is dismissed as an improper party. Thomas, 697 F.3d at 613. Plaintiff’s Amended
Complaint is less than clear with regard to whether Defendants are sued in their
individual or official capacities and whether Plaintiff seeks monetary or injunctive
relief.1 On its face, the Amended Complaint seeks to hold the individual Defendants

1 Unfortunately, this is representative of Plaintiff’s counsel’s approach to this case as a whole. Aside
from the noted failure of Plaintiff’s counsel to properly file the Second Amended Complaint and his
dilatory nature exhibited in multiple rounds of Motion to Dismiss briefing, the Amended Complaint
and Response brief leave much to be desired from a member of the Bar. Aside from frequent
typographic and grammatical errors, Plaintiff’s submissions to this Court consist of meandering and
oftentimes wholly irrelevant argument. For instance, portions of Plaintiff’s Response seem to be copied
from a brief filed in an unknown case in Florida state court. See (Dkt. 32, pg. 16). At times, Plaintiff
aimlessly transitions between speaking in the first and third person, leaving the Court guessing as to
liable on the Due Process and Equal Protection claims solely in their official capacity.
(Dkt. 17, pg. 9). Yet, Plaintiff goes on to seek compensatory and punitive damages
against each Defendant. (Id. at pg. 14). In an attempt to clarify its position, Plaintiff

states in its Response brief “that the Defendants are sued in their individual capacity
for money damages [sic] in their official capacities for injunctive relief.” (Dkt. 32, pg.
8).
Irrespective of the relief sought, Plaintiff has failed to state any claim against
Defendants Lorenzini and Tracy. At a bare minimum, Plaintiff must allege that
Defendants were “personally responsible for the alleged deprivation of the plaintiff’s
constitutional rights.” Mitchell v. Kallas, 895 F.3d 492, 498 (7th Cir. 2018); Franklin

v. Bowens, 777 Fed.Appx. 168, 169 (7th Cir. 2019). This personal responsibility
requirement can be “satisfied if the constitutional violation occurs at a defendant’s
direction or with her knowledge or consent.” Id. Here, Plaintiff fails to meet even
this relatively low bar. Aside from listing Defendants Tracy and Lorenzini as parties
to the case, the Amended Complaint is completely devoid of any mention of them,
much less an allegation connecting them to Plaintiff’s alleged constitutional

deprivations. Even after Defendants note this defect in their Motion to Dismiss,
Plaintiff fails to even acknowledge this fatal oversight. To the extent Plaintiff
attempts to overcome this shortcoming with generalized allegations of vicarious
liability or respondeat superior, those arguments similarly fail as government
officials are not deemed liable merely because of their official title. Iqbal, 556 U.S. at

the Plaintiff’s allegations. See (Dkt. 17, pg. 5). Moreover, Plaintiff repeatedly relies upon centuries-
old case law as opposed to providing this Court with up-to-date precedent from this circuit.
676 (“Because vicarious liability is inapplicable to Bivens and § 1983 suits, a plaintiff
must plead that each Government-official defendant, through the official’s own
individual actions, has violated the Constitution.”). Plaintiff has failed to state any

claim against Tracy and Lorenzini and consequently, Defendants’ Motion to Dismiss
is granted as it pertains to the two respective Defendants. As such, the following
analysis applies solely to the remaining individual Defendant, Defendant Jones.
II. Due Process Clause

For Plaintiff’s Procedural Due Process claim to survive a Motion to Dismiss, it
must allege “(1) deprivation of a protected interest, and (2) insufficient procedural
protections surrounding that deprivation.” Michalowicz v. Vill. of Bedford Park, 528
F.3d 530, 534 (7th Cir. 2008). Determining the existence of a protected interest is not
an exercise of simply referring to the Constitution, rather interests “’are created and
their dimensions are defined by existing rules or understandings that stem from an
independent source such as state law.’” Barrows v. Wiley, 780 (7th Cir. 2007) (quoting
Deen v. Darosa, 414 F.3d 731, 734 (7th Cir. 2005)).
Plaintiff’s Procedural Due Process claim falters on the first prong. Plaintiff

fails to even allege a protected interest in its Amended Complaint or remedy this
failure in its Response.2 Even reading between the lines and making the assumption
on behalf of Plaintiff that it does in fact allege a protected interest in the form of its

2 Instead, as one such example of the previously mentioned references to a Florida proceeding, Plaintiff
points to some wrong “committed by the Circuit Court for the State of Florida whose power deprives
from the Constitution of the Great State of Florida” and in the very next sentence jumps to the
conclusory statement that “[t]herefore, this prong is satisfied.” (Dkt. 32, pg. 16). The response then
quickly devolves into a confused screed, engaging in broad platitudes on the abstract importance of
due process, and curiously referencing the Magna Carta. (Id. at pgs. 16-17).
now revoked gambling license would not be enough to defeat Defendants’ Motion.
The Supreme Court of Illinois has addressed the issue and flatly foreclosed the notion
that a protected liberty interest exists in the form of a gambling license. J & J

Ventures Gaming, LLC v. Wild, Inc., 2016 IL 119870, ¶ 26, 67 N.E.3d 243, 251 (“There
is no common-law right in Illinois to engage in or profit from gambling. … The Act,
which legalized the use of video gaming terminals under certain limited
circumstances, is an exception to the general prohibition against gambling. …
Consequently…gaming contracts that do not conform to the applicable regulatory
requirements are void.”) (internal citations omitted). Plaintiff has identified no other
source of its supposed liberty interest and the Court is aware of none. Thus, Plaintiff

has failed to state a claim for violation of the Due Process clause and Defendants’
Motion is granted as to Count I.
III. Equal Protection Clause

To successfully plead a class-of-one Equal Protection claim, a plaintiff must
allege “(1) that he has been intentionally treated differently from others similarly
situated, and (2) that there is no rational basis for the difference in treatment.” Fares
Pawn, LLC v. Indiana Dep’t of Fin. Institutions, 755 F.3d 839, 845 (7th Cir. 2014)
(citing Village of Willowbrook v. Olech, 528 U.S. 562, 564 (2000)). To fulfill the first
prong, “a comparator must be ‘identical or directly comparable’ to the plaintiff ‘in all
material respects.’” Miller v. City of Monona, 784 F.3d 1113, 1120 (7th Cir. 2015)
(quoting LaBella Winnetka, Inc. v. Vill. of Winnetka, 628 F.3d 937, 942 (7th Cir.
2010)); Chicago Studio Rental, Inc. v. Illinois Dep’t of Commerce, 940 F.3d 971, 980
(7th Cir. 2019) (“[Plaintiff] must show that it was treated differently than another
entity that is prima facie identical in all relevant aspects.”) (internal quotations
omitted). The second prong of the analysis is more demanding and requires the

plaintiff show the absence of any rational basis for the state action. Miller, 784 F.3d
at 1120. Even alleging that the state acted with malice or an improper motive is
insufficient because “’a given action can have a rational basis and be a perfectly
logical action for a government entity to take even if there are facts casting it as one
taken out of animosity.’” Fares Pawn, 755 F.3d at 845 (quoting Flying J Inc. v. City
of New Haven, 549 F.3d 538, 547 (7th Cir. 2008)). To defeat a class-of-one claim at
the pleadings stage, defendants need only identify a single “conceivable rational basis

for the different treatment; it does not need to be the actual basis for defendant’s
actions.” Chicago Studio Rental, 940 F.3d at 980.
Plaintiff has failed to successfully plead that Defendants lacked a rational
basis for revoking its gaming license and therefore its Equal Protection claim fails.
Plaintiff concentrates its effort on the first prong of the Equal Protection claim—that
it was treated differently than a similarly situated entity—and outside the conclusory

assertion that “there exists no rational or legitimate basis for the” Defendants’
actions, Plaintiff does not address the second prong regarding Defendants’ basis for
the action. (Dkt. 32, pg. 19). There is little doubt that Illinois “has a legitimate
interest in creating and maintaining public confidence and integrity in the video
gaming industry.” Dotty’s Café v. Illinois Gaming Bd., 2019 IL App (1st) 173207, ¶
38. These interests are intimately related to the well established state interests of
consumer protection and public health—both areas which are unquestionably within
the realm of legitimate state interests. Id. The action Plaintiff complains of was
made pursuant to Illinois Gaming Board Rule 810(c). (Dkt. 17, pg. 6). Rule 810(c)

places certain limits on the number of gaming terminals adjacent businesses can
operate when those businesses have a common ownership. (Id.). In its Motion,
Defendants proffer three bases for the Rule and their action specifically with respect
to Plaintiff : (1) to “keep[] the number of terminals limited to make regulation easier,”
(2) “to prevent a heavy concentration of terminals in one business because that may
increase the potential for fraud and corruption,” and (3) to be fair to other businesses
that abide by the rules. (Id. at pgs. 13-14). To dispose of Plaintiff’s Equal Protection

claim, Defendants need only identify a single conceivable rational basis for their
action. Chicago Studio Rental, 940 F.3d at 980. Here, they offer three, with each
rationally and reasonably related to an important state interest. Each of the
justifications remains unrebutted. Therefore, Plaintiff has failed to state an Equal
Protection claim and Count II is dismissed.
IV. Administrative Review

Pendent jurisdiction allows a court which has jurisdiction over one claim to
exercise jurisdiction over other claims where jurisdiction may otherwise be
independently lacking. See Robinson Eng'g Co. Pension Plan & Tr. v. George, 223
F.3d 445, 449-50 (7th Cir. 2000). District Courts maintain broad discretion to
relinquish pendent jurisdiction over state law claims when the "anchor" federal claim
drops out of the proceeding. See Dietchweiler by Dietchweiler v. Lucas, 827 F.3d 622,
631 (7th Cir. 2016). Plaintiff's federal claims, Counts I and II, have been dismissed.
With no independent basis for federal question jurisdiction over Count III, the Court
declines to exercise pendent jurisdiction over Plaintiffs claim for administrative
review. Count III is dismissed for lack of subject-matter jurisdiction.
CONCLUSION
For the reasons detailed above, Defendants’ Motion to Dismiss is granted.
Plaintiff has now filed three Complaints in this matter—none of which have
sufficiently stated a claim. Plaintiff's Due Process and Equal Protection claims
(Counts I and II) are dismissed with prejudice for failure to state a claim and its
Administrative Review claim (Count III) is dismissed for want of subject-matter
jurisdiction.
J baer! Henstetr
por reel FS AMEE
ginia M. Kendall
United States District Judge
Date: December 6, 2019

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10141784. Public record. Not legal advice.