Manta Management v. City of San Bernardino 5/11/06 CA4/2

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State: California

Court: 1st District Court of Appeal 1st District Court of Appeal

Docket No: E036942

Case Date: 08/30/2006

Preview:Filed 5/11/06

CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO

MANTA MANAGEMENT CORPORATION, E036942 Cross-complainant and Respondent, (Super.Ct.No. SCVSS18157) v. OPINION CITY OF SAN BERNARDINO, Cross-defendant and Appellant.

APPEAL from the Superior Court of San Bernardino County. Donald R. Alvarez, Judge. Affirmed. Arias, Lockwood & Gray, Arias Aaen, Joseph Arias, Christopher D. Lockwood and Laura Tall Liu, for Cross-defendant and Appellant. Roger J. Diamond for Cross-complainant and Respondent. INTRODUCTION The City of San Bernardino (the city) appeals from a judgment in the amount of $1.4 million, representing damages incurred by Manta Management Corporation (Manta) as a result of a preliminary injunction the city obtained to enforce a zoning ordinance

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prohibiting Manta's operation of an adult cabaret. The preliminary injunction was dissolved after this court upheld the trial court's ruling which declared the zoning ordinance unconstitutional, and the California Supreme Court denied review. The city contends that damages are available for a wrongfully issued preliminary injunction only if a bond has been posted or if the party wrongfully enjoined prevails in a separate action for malicious prosecution. Manta contends that the trial court correctly found that it is entitled to recover damages resulting from the injunction, despite the absence of an injunction bond, via its cross-complaint for violation of its civil rights pursuant to section 1983 of title 42 of the United States Code. The city also contends that the award of damages is not supported by substantial evidence because there was no factual basis for separating legal profits from profits derived from illegal activities (i.e., prostitution), and that the trial court improperly placed the burden of identifying "each dollar derived from prostitution" on the city. Finally, it contends that because a large portion of Manta's profits are derived from activities which violated a city ordinance, the court erred in excluding any evidence concerning the ordinance. We will affirm the judgment. FACTUAL AND PROCEDURAL BACKGROUND The following background is derived from the record in an appeal in a related action (People v. Manta Management Corp. (Jan. 26, 1999, E019635) [nonpub. opn.]), and from the record in the present appeal.

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In November of 1993, the city issued Manta a conditional use permit for the operation of a nightclub to feature live entertainment and dancing at a location on Hospitality Lane. The nightclub site is located in a regional commercial, or "CR-3," zone. Under the city's zoning ordinances as codified in its "Development Code," title 19 of its municipal code, nightclubs are permissible land uses in CR-3 zones. (San Bernardino Mun. Code (SBMC),

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