Rothenberg v. Daus, 481 F. App'x 667

Rothenberg v. Daus involved TLC suspending and then revoking taxi licenses after drug-testing and post-arrest convictions.
Plaintiffs alleged Fourteenth Amendment due-process violations: lack of fair warning, inadequate notice of hearings, inadequate hearings, and biased decision-makers.
District court granted summary judgment on federal claims, dismissed state-law claims, and dismissed certain individuals.
Second Circuit vacated in part and remanded for further proceedings on due-process issues, while affirming dismissal of TLC as a defendant and deeming the Fourth Amendment claim forfeited on appeal.
On remand, issues included whether drug-testing rule language (may versus shall) created fair warning; whether notices and hearings were sufficiently specific; and whether any ALJ bias or Article 78 proceedings affected due-process analysis.
The court also noted need for record development regarding testing procedures’ accuracy and potential zero-tolerance policies, and re-evaluated conviction-based revocation under good-moral-character standards.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiffs received fair warning under due process.	Abood, Doumbia, Katsigiannis, Rothenberg	TLC relied on regulatory history to support fair warning	Remanded for further factual/textual analysis of warning standard
Whether notices and hearings provided adequate notice and meaningful opportunity to be heard.	Notices failed to specify legal bases and issues	Notices were adequate in informing hearings	Remanded for reconsideration with more specific notice analysis
Whether post-deprivation hearings suffice and Mathews factors favor the government given timing.	Post-deprivation hearings were insufficient, need pre-deprivation protections	Interests in public safety justify streamlined procedures pre-deprivation	Remanded with Mathews factors applied to post-deprivation context; consider Article 78 review timing/scope
Whether conviction-based revocation used a proper good-moral-character standard or per se policy.	Per se revocation for certain convictions; lack of individualized assessment	Good moral character or on-duty/offense-based standards may apply	Vacate/reconsider under proper standard on remand; assess relevant TLC rules and evidence of policies
Whether ALJ bias and use of Article 78 proceedings tainted due process.	Evidence of bias and supervisory control undermines impartiality	Article 78 provides post-deprivation review; no inherent bias shown	Remand to reevaluate bias and Article 78 impact; not resolved on appeal

Piscottano v. Murphy, 511 F.3d 247 (2d Cir. 2007) (due-process vagueness and fair warning issues in regulatory context)
Village of Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489 (U.S. 1982) (regulatory notice sufficiency depends on context and clarity of language)
Rock of Ages Corp. v. Sec’y of Labor, 170 F.3d 148 (2d Cir. 1999) (text of rule provides fair notice; regulatory interpretation cautious)
Upton v. S.E.C., 75 F.3d 92 (2d Cir. 1996) (cannot defer to agency interpretation if it punishes unaired fair notice)
Nnebe v. Daus, 644 F.3d 147 (2d Cir. 2011) (post-deprivation hearings and Mathews analysis in TLC context)
Spinelli v. City of New York, 579 F.3d 160 (2d Cir. 2009) (adequacy of notice; specificity of infractions matters)
Mathews v. Eldridge, 424 U.S. 319 (U.S. 1976) (three-factor framework for evaluating pre/post-deprivation process)
Ward v. Village of Monroeville, 409 U.S. 57 (U.S. 1972) (bias and impartiality concerns in adjudicatory proceedings)
Tumey v. Ohio, 273 U.S. 510 (U.S. 1927) (due-process limits on adjudicator with financial interest)
Withrow v. Larkin, 421 U.S. 35 (U.S. 1975) (presumption of honesty in adjudicators can be rebutted by conflicts)