Top Flight Entertainment, Ltd. v. Schuette
729 F.3d 623
6th Cir.2013Background
- Top Flight Entertainment (Flight Club) and Flying Aces subleased space to host Michigan "millionaire parties" (charitable gaming events) at a topless-entertainment club. Qualified organizations apply for short-term licenses to hold such events.
- After initial approvals and advertising, complaints arose about holding gaming events at a topless bar; state police investigated and executed a search warrant. The Bureau of the State Lottery allegedly began denying or delaying all millionaire-party license applications for events at Flying Aces’ location.
- Plaintiffs sued Attorney General Bill Schuette and Lottery Commissioner M. Scott Bowen (official and individual capacities) under 42 U.S.C. § 1983, asserting First Amendment retaliation (freedom of expression and right to petition) and Fourteenth Amendment procedural and substantive due process claims.
- The district court dismissed most claims for failure to state a claim, granted Bowen quasi-judicial immunity, and dismissed Schuette for lack of personal involvement; Plaintiffs appealed.
- The Sixth Circuit: affirmed in part, reversed in part, and remanded — finding standing; reversing dismissal of First Amendment retaliation claims (Counts I–III) as plausibly pleaded; affirming dismissal of procedural due process (Count IV); affirming Bowen’s quasi-judicial immunity on waiver grounds but reversing dismissal of Bowen in his official capacity; affirming dismissal of Schuette.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing | Plaintiffs alleged economic injury from lost future millionaire-party leases traceable to license denials | No concrete injury / not traceable | Held: Plaintiffs have standing (injury, traceable, redressable) |
| Free-speech retaliation (Count I) | Denials were motivated by retaliation for offering/adverting adult entertainment (protected expressive conduct) | Denials were unrelated or based on complaints/illegal activity and prior approvals show no retaliation | Held: Complaint plausibly alleged First Amendment retaliation; reversal of dismissal |
| Right to petition / retaliation for litigation (Counts II–III) | Denials were retaliatory response to Plaintiffs’ lawsuits challenging a statute (right to redress) | Denials were motivated by investigation/illegal activity; third-party license denial wouldn't deter petitioning | Held: Plaintiffs pleaded plausible retaliation; district court properly denied dismissal on these counts |
| Procedural due process (Count IV) | Plaintiffs claimed entitlement to “approved lessor” status without due process | State law creates no property interest; licenses issued at commissioner’s discretion | Held: Dismissal affirmed—no constitutionally protected property interest in being an approved location |
| Immunity & personal involvement | Bowen and Schuette are proper defendants for injunctive relief; Bowen not immune in official capacity; Schuette was involved | Bowen entitled to quasi-judicial immunity; Schuette lacked personal involvement | Held: Bowen entitled to quasi-judicial immunity in individual capacity (waiver of challenge below) but not in official-capacity suit (dismissal reversed as to official-capacity relief); Schuette not sufficiently connected—claims against him affirmed dismissed |
Key Cases Cited
- Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., 528 U.S. 167 (standing requirements for federal suits)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (12(b)(6) plausibility standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading standards; supervisory liability limits)
- City of Erie v. Pap’s A.M., 529 U.S. 277 (nude dancing as protected expressive conduct)
- Bd. of Regents of State Colleges v. Roth, 408 U.S. 564 (property interests for procedural due process)
- Town of Castle Rock v. Gonzales, 545 U.S. 748 (discretion defeats entitlement/property interest)
- Ex parte Young, 209 U.S. 123 (suing state officials for prospective injunctive relief)