The legal dispute between Prosperity Farms LLC and the Department of Licensing and Consumer Affairs has moved to federal court, even as local courts continue to mull over a request for judicial review.
In September, government officials shut down Prosperity Farms’ bar, food-service, and event operations, alleging that necessary permits and approvals were missing. Days later, the business asked the V.I. Superior Court to review and overturn a separate administrative decision by DLCA, claiming that due process considerations in the regulatory process were not followed. A writ of review granted in that matter was stayed pending appeal by the DLCA.
Now, however, Prosperity Farm LLC and RaisingCane NY LLC have filed a complaint in the District Court of the Virgin Islands, claiming constitutional violations as a result of the actions of DLCA officials.
The 136-page civil complaint reiterates Prosperity Farms’ objections to how a hearing to deal with several issued citations was handled by DLCA officials. Changing the rules of the hearing without adequate notice was a violation of Prosperity Farm’s 14th Amendment due process rights, the complaint claims. So was moving forward with the hearing without adequate notice of a date change, the lawsuit argues.
When the hearing was actually held, the process was riddled with procedural and technical errors, the complaint argues. “It was realized: $3000 was collected on a citation whose statutory maximum was $1000 and which was never heard,” the lawsuit alleges. “Fines and a cease-and-desist order [were] issued on findings the transcript does not support.” The lawsuit also details at least one citation that had been altered after issuance.
The federal complaint raises an issue not discussed in the companies’ lawsuit in local court – the seizing of license plates and a registration sticker from a company tractor. Last November, according to the lawsuit, the RaisingCane’s tractor was stopped on a local roadway, and officers had the license plates and registration stickers removed. The items reportedly remain in police possession, and “the seizure was made without a warrant, without a court order, levy, writ or administrative subpoena, without consent, and without exigent circumstance.”
The tractor’s registration was cancelled shortly thereafter, which the lawsuit alleges was done without a hearing beforehand as required under local law. As a result, several officers of the Virgin Islands Police Department have been named as defendants along with officials of the DLCA.
The impact of Prosperity Farms’ licensing challenges reportedly also extended to their business partners as well. The lawsuit claims that despite having their products approved for sale by the DLCA, agency personnel contacted three supermarkets to warn them that they would be fined for continuing to offer RaisingCane’s products for sale in their establishments. The threats did prompt the supermarkets to stop selling the products in question – triggering another due process violation, the lawsuit argues. The complaint also alleges retaliation against the businesses by DLCA, and claims that the forced closure of the businesses is another violation of the Fourteenth Amendment.
The lawsuit seeks an injunction prohibiting DLCA officials from conducting hearings outside properly-established procedural rules and from converting hearings from one type to another without adequate notice. The complaint also asks the court to prevent DLCA officials from threatening fines against their commercial partners for purchasing or distributing RaisingCane products. Most consequentially, the lawsuit asks the court to issue an injunction against the government’s closure of RaisingCane’s public-facing operations and the cancellation of the tractor registration and seizure of its license plates.
Compensatory and punitive damages have also been requested.
