BEFORE THE IOWA DEPARTMENT OF COMMERCE ALCOHOLIC BEVERAGES DIVISION DOCKET NO. A DIA NO. 09DOCBL006

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1 BEFORE THE IOWA DEPARTMENT OF COMMERCE ALCOHOLIC BEVERAGES DIVISION IN RE: CHP LLC d/b/a Trucker Bar 1915 Bourland Avenue Waterloo, IA DOCKET NO. A DIA NO. 09DOCBL006 PROPOSED DECISION Liquor License No. LC On or about December 9, 2008, the Waterloo City Council (local authority) denied the renewal application for Liquor License No. LC-35794, filed by CHP LLC, d/b/a Trucker Bar (Licensee). The licensee filed a timely Notice of Appeal with the Iowa Alcoholic Beverages Division (division). The hearing was held by telephone before the undersigned administrative law judge on March 2, 2009 at 9:00 a.m. Attorney Dave Zellhoefer represented the local authority. Attorney Jay Roberts represented the licensee. THE RECORD The record includes the electronic license renewal application; Division s Notice of Denial to Licensee; Notice of Appeal; Notice of Hearing; the testimony of the witnesses; and the following exhibits: Local Authority Exhibit 1: Local Authority Exhibit 2: Local Authority Exhibit 3: Local Authority Exhibit 4: Waterloo Police Incident Report for 3/23/08, Criminal Complaints and Citations Waterloo Police Incident Report for 5/23/08, Criminal Complaints and Citations Waterloo Police Incident Report for 5/26/08, Criminal Complaints and Citations Waterloo Incident Report for 7/23/08

2 Page 2 Local Authority Exhibit 5: Waterloo Incident Report for 7/27/08, Criminal Complaint and Citation Local Authority Exhibit 6: Waterloo Incident Report, 8/16/08, Criminal Complaint and Citation Local Authority Exhibit 7: Waterloo Incident Report, 8/16/08 Local Authority Exhibit 8: Waterloo Incident Report, 9/2/08, Criminal Complaint and Citation Local Authority Exhibit 9: Waterloo Incident Report, 9/13/08 Local Authority Exhibit 10: Waterloo Incident Report, 9/16/08 Local Authority Exhibit 11: Waterloo Incident Report, 1/7/09 Local Authority Exhibit 12: Printout of Calls for Service (66 pages) Licensee Exhibit A: Order, Black Hawk County District Court, 12/23/08 In addition, official notice was taken of the Division s Docket No. D , which concerned the licensee s violation of Iowa Code section (2)(h) for a sale to underage person by Hasan Puric on March 23, 2008 and included Satisfaction of Judgment for the licensee s payment of a $500 civil penalty. FINDINGS OF FACT 1. On or about November 3, 2008, CHP LLC, d/b/a Trucker Bar (licensee) filed an electronic renewal application for Liquor License No. LC-35794, issued for the premises at 1915 Bourland Avenue in Waterloo, Iowa. Hasan Puric and his wife, Cecilija Puric, purchased Trucker Bar in 2006 and are each 50% owners of CHP LLC. They have invested approximately $150,000 in the business. The Purics came to the United States from Bosnia in They have two children ages 22 and 19. (Liquor License Application; Testimony of Cecilija Puric) Trucker Bar is located in a commercial area of Waterloo, but there is a residential area immediately to the west of the bar. On or about December 9, 2008, the local authority

3 Page 3 denied the license renewal application. The reason given by the local authority for the denial was 68 calls for service in one year, including narcotics. (Testimony of Robert Jackson Greenlee III) 2. From December 31, 2007 through December 9, 2008, the Waterloo Police Department initiated or responded to approximately 66 calls for service to the Trucker Bar. Thirty-four (34) of the sixty-six (66) calls were for extra attention or bar checks that resulted in no finding of problems or violations. Ten (10) calls involved complaints of loud music made between May and August Most of the noise complaints were made by the bar s next door neighbor, Rosella (Rosie) Thompson, at a time when the bar was hosting karaoke. A total of four (4) calls were made by owner Cecilija Puric: two calls were to report missing money and two calls concerned a robbery on November 17, An additional six (6) calls concerned reports of fights or assaults that could not be confirmed when officers arrived. The majority of the police call summaries provide minimal information. (Local Authority Exhibit 12) 3. The local authority submitted incident reports and in some cases complaints and citations, for eleven (11) of the sixty-six (66) calls for service. The incident reports are described below. a. On March 23, 2008, police officers were called to the Trucker Bar on a report of underage persons drinking in the bar. When they entered the bar, they noticed several people who appeared to be under the legal age, including two males who were sitting at the bar with open bottles of beer directly in front of them. The two males were later identified as Elvis Puric, who is the son of the bar s owners, and Nihad Coralic. As one of the officers approached, he saw the female bartender grab the two bottles of beer that were in front of Puric and Coralic and place them off the counter behind the bar. The officers arrested three underage persons inside the bar, all of whom had positive preliminary breath tests (PBT). One of the persons arrested was the female bartender, Azra Miskic, who was 19 years old (DOB: 10/3/88). Her PBT was.078. Elvis Puric, age 18 (DOB: 7/24/89) and Nihad Coralic, age 20 (DOB: 12/06/87) were also arrested. Puric had a PBT of.026 but denied that he

4 Page 4 was served at the bar and claimed he had been drinking at home. Coralic had a PBT of.037 and told officers that Miskic served him two bottles of beer at the bar. Miskic admitted to drinking a shot of apple pucker at the bar and told officers that Elvis Puric s father, Hasan Puric, sold him alcohol at the bar. Nihad Coralic and Elvis Puric were both issued citations for possession of alcohol under age, in violation of Iowa Code section A. Azra Miskic and Hasan Puric were both issued citations for providing alcohol to persons under the legal age, in violation of Iowa Code section (2)(h). The officers prepared an incident report, which was submitted at hearing. None of the arresting officers testified. (Local Authority Exhibit 1) On May 28, 2008, the licensee paid a $500 civil penalty to the Division for the sale to an underage person by Hasan Puric on March 23, (Official Notice of Division File D ) The licensee reported Mr. Puric s arrest and criminal charge on the renewal application. (Electronic renewal application) No evidence was submitted concerning the disposition of the citation to Azra Miskic. b. On May 23, 2008 at 12:23 a.m., three officers were dispatched to the Trucker Bar for a bar check. When they entered the bar, the officers saw a male customer, later identified as Alen Husic, standing at the bar. Two officers filed incident reports stating that there was a bottle of Corona beer on the bar in front of Husic but that the female bartender, later identified as Azra Miskic, grabbed the bottle of beer off the bar when the officers entered. One of the officers reported that Husic had his hands on the bottle of beer. Alen Husic was 19 years old and appeared very intoxicated. He told the officers that he had arrived at the bar drunk and had not been drinking at the bar. Husic was placed under arrest for public intoxication and was later convicted. The bar s manager, Hajradin Puric, was behind the bar serving drinks. 1 He told the officers that Husic showed up at the bar drunk and was asked to leave. He denied that they had served Husic. Azra Miskic told the officers that she had pulled the beer off the bar because Husic was on probation, and she did not want the officers to think it 1 Hajradin Puric managed the bar from May through August (Testimony of Cecilija Puric)

5 Page 5 was his. The officers issued Hajradin Puric a citation for serving alcohol to underage persons, in violation of Iowa Code section (2)(h). (Local Authority Exhibit 2; Testimony of Robert Jackson Greenlee III) On December 23, 2008, Hajrudin Puric was found not guilty following a trial on the citation for selling alcohol to an underage person. (Licensee Exhibit A) c. On May 26, 2008 at 2:06 a.m., officers were dispatched to the Trucker Bar to respond to a fight in the parking lot. There was no fight in the parking lot so the officers knocked on the door of the bar. A male, later identified as Asim Bejtic, charged at the door and appeared angry. His shirt was torn in several places and he had blood on him. The officers arrested him. The female bartender reported that another male, later identified as Alija Heco, was also involved in the fight. Heco had blood on his forehead. The men claimed that they were jumped by 3 Bosnian males who asked if they wanted to fight for money. Both were arrested for Disorderly Conduct. At the jail, officers found a baggie of cocaine in Heco s front pants pocket. He was also charged with Possession of Cocaine. No information was provided concerning the disposition of the charges. (Local Authority Exhibit 3) d. On July 23, 2008 at 11:49 p.m., officers were called to a residence on the report of an assault that occurred at the Trucker Bar. The reporting party, Jason Rogge, told officers that he had been talking to an old lady sitting at the bar, and she called a Sons of Silence member, later identified as Kirk Alan Pierce. Pierce came to the bar and verbally confronted Rogge. The owner of the bar told them to go outside, and they both left the bar. When they got outside, Pierce punched Rogge in the face and kicked him in the groin. It appears that the case was closed without charges being filed. (Local Authority Exhibit 4) e. On July 27, 2008 at 1:00 a.m., neighbor Rosie Thompson reported loud music at the Trucker Bar. The responding officers could hear the music outside the bar and could feel the bass from the music while standing on the front step of Ms. Thompson s residence. The report indicates that the decibel level had been previously

6 Page 6 checked with a noise meter and was 10-15% under the limit. 2 No citation was written, but the licensee shut the music down for the night. (Local Authority Exhibit 5; Testimony of Robert Greenlee III) On August 16, 2008, Ms. Thompson made two loud music complaints. The first complaint was made at 1:23 a.m. When officers arrived, they could not hear any loud music. The licensee had already turned the music down earlier that evening at Ms. Thompson s request. The officers issued Hajrudin Puric a citation for Prohibited Acts (Loud Music from a Business) in violation of ordinance W (Local Authority Exhibit 6) At 11:40 p.m. on August 16, 2008, Ms. Thompson made a second noise complaint. The responding officers checked the noise level, and it did not exceed the ordinance limit. No citation was issued. (Local Authority Exhibit 7) f. At approximately midnight on September 2, 2008, officers were called to the Trucker Bar because a person, later identified as Alijia Heco, was trying to start fights. Alijia Heco appeared intoxicated and admitted that he had been drinking alcohol, but he denied that he was creating problems. He was arrested for public intoxication after he failed to complete a PBT test. (Local Authority Exhibit 8) g. On September 13, 2008 at 7:04 p.m., officers were dispatched to the Trucker Bar on a report that minors were drinking inside the establishment. One of the responding officers smelled smoke upon entering the bar, saw a customer smoking a cigarette, and told him to put the cigarette out. Another officer identified an eighteen year old sitting at a table. The eighteen year old denied that he had been drinking and consented to a PBT, which registered Officers also observed two children, ages 7 and 13, sitting with their father at the bar. The bar s owner, Hasan Puric, was in charge of the premises that 2 Sgt. Greenlee testified that the city s noise ordinance prohibits noise over a certain decibel level and also prohibits loud noise that causes vibrations in a neighboring building. The local authority did not submit a copy of the noise ordinance. 3 Waterloo has a city ordinance which prohibits persons under the age of 21 from being inside a bar unless food sales are at least 51% of the bar s business. The Trucker Bar does not qualify for the exemption. (Testimony of Robert Greenlee III; Local Authority Exhibit 9). The local authority did not submit a copy of the ordinance.

7 Page 7 evening, and was advised that he would be issued citations for permitting underage persons inside the premises. (Local Authority Exhibit 9) 4 The record does not include any citations issued on this date. h. On January 7, 2009 at 10:23 p.m., an officer entered the Trucker Bar and saw a customer in the corner of the bar smoking a cigarette and putting his ashes in a beer can. The bartender was standing directly in front of the customer while he smoked. An incident report was filed but no citation was issued. (Local Authority Exhibit 11) 3. Vic s Lounge is located across the street to the east of the Trucker Bar and has been in business in Waterloo for over 30 years. During the same period of time that the police had 66 calls for service to Trucker Bar, there were only 18 calls for service to Vic s. (Testimony of Robert Greenlee III) 4. Cecilija Puric currently manages Trucker Bar, which is her sole occupation. Hasan Puric drives truck for a living and is on the road five to six days a week. Bartender Azra Miskic was fired after the owners learned that she had been drinking and serving minors. The bar cancelled karaoke in the fall of 2008 due to the noise complaints. Ms. Puric acknowledged that many of her Bosnian customers are smokers and will try to sneak cigarettes in the bar, but testified that if she catches them she asks them to leave the bar. Ms. Puric further testified that if customers are intoxicated or causing trouble she asks them to leave. She feels that she has control over the bar. (Testimony of Cecilija Puric) CONCLUSIONS OF LAW I. Applicable Statutes and Rules Iowa Code section (6)(2007) provides: 6. Appeal to administrator. An applicant for a liquor control license, wine permit, or beer permit may appeal from the local authority's 4 Cecilija Puric claimed that officers had told her it was permissible for the children to be present when their parents were there. She recalled that they were having a pizza and hot dogs for a birthday party on this occasion.

8 Page 8 disapproval of an application for a license or permit to the administrator. In the appeal the applicant shall be allowed the opportunity to demonstrate in an evidentiary hearing conducted pursuant to chapter 17A that the applicant complies with all of the requirements for holding the license or permit... Iowa Code section (1)(a)(2007) provides: 1. a. A liquor control license may be issued to any person who is of good moral character as defined by this chapter. Iowa Code section 123.3(26)(2007) defines the good moral character requirement: 26. "Person of good moral character" means any person who meets all of the following requirements: a. The person has such financial standing and good reputation as will satisfy the administrator that the person will comply with this chapter and all laws, ordinances, and regulations applicable to the person's operations under this chapter IAC 4.2(4) b provides further guidance for determining good moral character: 4.2(4) Financial standing and reputation. A local authority or the administrator may consider an applicant's financial standing and good reputation in addition to the other requirements and conditions for obtaining a liquor control license...and local authority or the administrator shall disapprove or deny an application for a liquor control license,... if the applicant fails to demonstrate that the applicant complies with the lawful requirements and conditions for holding the license... b. In evaluating an applicant's "good reputation," the local authority or the administrator may consider such factors as, but not limited to, the following:... pattern and practice by the licensee or permittee or the

9 Page 9 licensee's or permittee's agents or employees, of violating alcoholic beverages laws and regulations for which corrective action has been taken since the previous license or permit was issued, sales to intoxicated persons,...licensee or permittee misdemeanor convictions, the recency of the misdemeanor convictions. II. Analysis The local authority did not go forward with sufficient evidence to justify its denial of the licensee s application for liquor license renewal. In the past year, Hasan Puric, one of the bar s owners, had a single violation for sale to an underage person on March 23, 2008, which was reported on the renewal application. The licensee paid a $500 civil penalty for this violation, in accordance with Iowa Code section (3)(a). 5 Although another bartender, Azra Miskic, was also charged with a sale to an underage person on that same date, the local authority presented no evidence concerning the disposition of that charge. It is unclear whether the local authority has pursued a separate administrative sanction based on the actions of Ms. Miskic. The citation issued to Hajradin Puric on May 23, 2008 for serving an underage person resulted in an acquittal at the criminal trial. Although administrative sanctions can still be imposed for a violation of Iowa Code section (2)(h) when there is no criminal conviction, 6 there is no evidence that the local authority has pursued an administrative sanction against the licensee based on this incident. Although there were several incidents of fights or assaults at the Trucker Bar, the local authority failed to show that these were the result of any improper or illegal actions by the licensee. In addition, no connection was shown between the licensee and the discovery of cocaine in the pocket of a customer following his arrest for disorderly conduct. 5 Iowa Code section (3) establishes a schedule of mandatory progressive administrative sanctions for selling or providing alcohol to underage persons in violation of Iowa Code section (2)(h). A second violation within two years subjects the licensee to a 30 day license suspension and a $1500 civil penalty. 6 Iowa Code section (1)(c)(2007).

10 Page 10 A number of noise complaints were made, but the licensee was issued only one citation for violating the noise ordinance. The local authority did not submit the disposition of this citation. It appears that the licensee has taken some remedial action to address and reduce the noise complaints. Similarly, although the incident reports state that citations would be issued for violations of the local ordinance prohibiting minors on the licensed premises, no citations were submitted into the record. The local authority may also seek administrative sanctions against a licensee for violations of local ordinances. The remaining police calls to Trucker Bar do not justify denying this liquor license renewal application. Most of these calls were for routine bar checks or incidents that could not be confirmed and resulted in no charges. In sum, the licensee s only founded violation of liquor laws in the past year was the sale to underage person by Hasan Puric that occurred on March 23, This violation was addressed through the imposition of the mandatory administrative sanction provided in Iowa Code section (3)(a). It is not appropriate to deny a liquor license based solely on the number of police calls to a licensed premises when the calls do not result in convictions that can be connected to the licensee s operations or in findings of administrative violations after an opportunity for hearing. If police calls reveal potential violations of liquor laws, e.g. sales to underage persons, allowing underage persons on the premises, or sales to intoxicated persons, then the local authority should take appropriate corrective action. This may include filing criminal charges and citations against the licensee as well as charging administrative violations with the division. ORDER IT IS THEREFORE ORDERED that the action of the Waterloo City Council denying the renewal application for Class C Liquor License LC-35794, filed by CHP LLC, d/b/a Trucker Bar, is hereby REVERSED. Pursuant to the administrative rules of the division, any adversely affected party may appeal a proposed decision to

11 Page 11 the Administrator of the Alcoholic Beverages Division within thirty (30) days after issuance of the proposed decision. In addition, the Administrator may initiate review of a proposed decision on the Administrator's own motion at any time within thirty (30) days following the issuance of a proposed decision. 185 IAC 10.27(1) and (2). Requests for review shall be sent to the Administrator of the Alcoholic Beverages Division, 1918 S.E. Hulsizer, Ankeny, IA Unless otherwise ordered, each appealing party may file exceptions and briefs within thirty (30) days of the notice of appeal or order for review. Within thirty (30) days thereafter, any party may file a responsive brief. The Administrator may shorten or extend the briefing period as appropriate. The Administrator may resolve the appeal on the briefs or provide an opportunity for oral argument. 185 IAC 10.27(6). The administrator may affirm, reverse or modify the proposed decision. A party who is adversely affected by the proposed decision shall not be deemed to have exhausted administrative remedies unless the adversely affected party files a request for review of the proposed decision within the time provided and the Administrator has reviewed the proposed decision and has affirmed, reversed, or modified the proposed decision. Dated this 20 th day of March, Margaret LaMarche Administrative Law Judge Department of Inspections and Appeals Division of Administrative Hearings Wallace State Office Building-Third Floor Des Moines, IA CC: See Attached Mailing List

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