89-001096 Division Of Alcoholic Beverages And Tobacco vs. Ocean Drive Hotel Corporation, D/B/A Ocean Haven Restaurant Status: Closed Recommended Order on Wednesday, April 19, 1989.

Summary: Repeated and flagrant violation of drug laws on licensed premises warrants revocation of alcoholic beverage license

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS REGULATION , )

DIVISION OF ALCOHOLIC BEVERAGES )

AND TOBACCO , )

)

Petitioner , )

)

vs. ) CASE NO. 89-1096

)

OCEAN DRIVE HOTEL CORPORATION , )

d/b/a OCEAN HAVEN RESTAURANT, )

)

Respondent. )

_____________________________________)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on March 7,

1989, at Miami, Florida, before Michael M. Parrish, a duly designated Hearing

Officer of the Division of Administrative Hearings. Appearances for the parties

at the hearing were as follows:

APPEARANCES

For Petitioner : Katherine A. Emrich, Esquire

Assistant General Counsel

Department of Business Regulation

The Johns Building

725 South Bronough Street

Tallahassee, Florida 32399-1000

For Respondent: Gino P. Negretti, Esquire

44 West Flagler Street

Miami, Florida 33130

ISSUES AND INTRODUCTION

This is a case in which the Petitioner seeks to suspend, revoke, and/or

take other disciplinary action against the Respondent's alcoholic beverage

license. The primary grounds for the proposed disciplinary action are that the

licensee has permitted patrons on the licensed premises to sell cocaine on

numerous occasions in violation of various statutory provisions. The specific

allegations are set forth in a Notice To Show Cause dated February 27, 1989.

An Emergency Order Of Suspension was served on the Respondent on February

27, 1989. The Respondent requested an emergency hearing, which was conducted on

March 7, 1989. Both parties offered evidence at the hearing. Following the

hearing the parties requested and were allowed until March 17, 1989, within

which to file their proposed recommended orders. The Petitioner filed a timely

proposed recommended order. The Respondent has not filed any post-hearing

documents. The proposed findings of fact submitted by the Petitioner are

specifically addressed in the appendix to this recommended order.

FINDINGS OF FACT

Based on the stipulations of the parties and on the evidence received at

the final hearing, I make the following findings of fact:

1. The Respondent, Ocean Drive Hotel Corporation, d/b/a/ Ocean Haven

Restaurant, is the holder of Alcoholic Beverage License Number 23-3568, Series

2-COP, for a licensed premises known as Ocean Haven Restaurant, which is located

at 155 Ocean Drive, Miami Beach, Dade County, Florida.

2. The licensed premises are located in a neighborhood which is somewhat

less than wholesome; a neighborhood in which there is a substantial amount of

illegal drug related activity. It is a neighborhood in which it is not uncommon

for police officers to observe people who have been previously arrested for drug

violations.

3. The Respondent corporation owns the licensed premises, as well as the

hotel premises of which the licensed premises are a part. The Respondent

corporation is owned by Mr. Heriberto Velasco. Mr. Velasco is the president of

the Respondent corporation and he is the manager of both the hotel and the

restaurant businesses. Mr. Velasco lives in the hotel with his wife, his

mother, and one of his sons. Mr. Velasco takes most of his meals in the

restaurant which comprises the licensed premises, and usually visits the

licensed premises at least three times a day for that purpose. There is no

evidence that he regularly spends any other time supervising activities in the

restaurant.

4. There are four employees in the restaurant that comprises the licensed

premises. Two of those employees are Gloria E. Berlioz and Antonia Rodriguez de

Alcina. The latter is also known by the name of Nora. Ms. Berlioz and Ms.

Alcina have both been employees on the licensed premises for a year or two. Ms.

Alcina is employed as a waitress. Ms. Berlioz is employed as a cook.

5. During the course of an undercover investigation during the months of

January and February of 1989, the following transactions involving controlled

substances took place within the licensed premises:

(a) On January 10, 1989, a patron known as Loraine sold cocaine to

Investigator Huguet.

(b) On January 18, 1989, a patron named Roberto Cantero sold cocaine

to Investigator Huguet.

(c) On January 19, 1989, an unknown white Latin male patron sold

cocaine to a patron named Tommy.

(d) On January 25, 1989, a patron named Roberto Cantero again sold

cocaine to Investigator Huguet.

(e) On January 26, 1989, an unknown Latin male patron sold cocaine to

Investigator Huguet.

(f) On February 6, 1989, a patron named Roberto Cantero again sold

cocaine to Investigator Huguet.

(g) On February 7, 1989, a patron named Roberto Cantero again sold

cocaine to Investigator Huguet.

(h) On February 10, 1989, a patron named Roberto Cantero again sold

cocaine to Investigator Huguet in two separate transactions.

(i) On February 10, 1989, a patron named Roberto Cantero also sold

cocaine to Investigator Lerra.

(j) On February 17, 1989, a patron named Roberto Cantero again sold

cocaine to Investigator Huguet, in two separate transactions.

(k) On February 17, 1989, a patron named Roberto Cantero also

delivered cocaine to an unknown white male patron.

(l) On February 22, 1989, a patron named Roberto Cantero again sold

cocaine to Investigator Huguet.

6. During the course of the vast majority of the drug transactions

described in the preceding paragraph, the people involved in the transactions

discussed the subject of drug transactions in normal conversational tones of

voice. During the majority of those conversations, either Ms. Berlioz or Ms.

Alcina was standing close enough to have heard the conversations. During some

of the conversations, Ms. Berlioz or Ms. Alcina was standing immediately on the

other side of the lunch counter, within two or three feet from the

conversations.

7. During the course of the vast majority of the drug transactions

described in Paragraph 5, above, the drugs involved in the transactions were

openly displayed on the table top or on the counter top in front of the

participants to the transactions. In each of the transactions involving

purchases by Investigator Huguet, the investigator attempted to be obvious about

what he was doing by holding the drugs in front of his face to inspect them

before putting the drugs in his pocket. During the vast majority of those

transactions, Ms. Berlioz or Ms. Alcina was standing close enough to have

observed the transactions. During some of the transactions, Ms. Berlioz or Ms.

Alcina was standing immediately on the other side of the lunch counter within

two or three feet from the drug transactions. One of the drug transactions took

place while Mr. Heriberto Velasco was standing several feet away.

8. All of the drug transactions described in Paragraph 5, above, took

place within the licensed premises during business hours when employees and

patrons were present on the licensed premises. None of the employees ever

called the police or asked any of the parties to the drug transactions to leave

the licensed premises.

9. Mr. Heriberto Velasco was aware that the licensed premises are located

in a neighborhood in which there is a high level of illegal drug activity.

Nevertheless, he did not take any special precautions to prevent or detect drug

activity on the licensed premises other than to tell the employees to let him

know if they saw any drug activity. Mr. Heriberto Velasco has never asked the

Division of Alcoholic Beverages and Tobacco for assistance or suggestions with

respect to preventing or eliminating drug activity on the licensed premises,

even though the Division of Alcoholic Beverages and Tobacco advises all

licensees of the availability of such assistance.

10. Mr. Heriberto Velasco did not have actual knowledge that drug

transactions were taking place on the licensed premises. He is opposed to drug

trafficking and he has not knowingly permitted sales of drugs in his hotel or on

the licensed premises. He has instructed his employees in the hotel and in the

restaurant to call him if they observe any drug related activity so that he can

throw out anyone involved in such activity. He has thrown people out of the

hotel when he suspected they were involved in drug related activities. The

employees in the licensed premises never told him about any drug related

activity on the premises. Mr. Velasco never observed any activity on the

licensed premises that he thought was drug related activity. Mr. Velasco does

not know what crack cocaine looks like.

11. Mr. Eric Velasco is the 20-year-old son of Mr. Heriberto Velasco. The

son lives at the hotel with his parents and helps with the management of the

hotel and restaurant to the extent he can between going to college and working

at another near-by job. Mr. Eric Velasco has never observed any activity in the

licensed premises that appeared to him to be drug related activity. He does not

know what crack cocaine looks like.

12. In brief summary, the vast majority of the drug transactions described

in Paragraph 5, above, took place in plain view within the licensed premises.

The open exchanges of drugs and money in conjunction with the open conversations

about drug transactions demonstrate a persistent pattern of open and flagrant

drug activity. The subject drug transactions were sufficiently open that they

would have been noticed by a reasonably diligent licensee.

CONCLUSIONS OF LAW

Based on the foregoing findings of fact and on the applicable legal

principles, I make the following conclusions of law:

13. The Division of Administrative Hearings has jurisdiction over the

subject matter of and the parties to this proceeding. Sec. 120.57(1), Fla.

Stat.

14. Section 561.29(1), Florida Statutes, authorizes the Division of

Alcoholic Beverages and Tobacco to revoke or suspend a beverage license upon a

showing of:

(a) Violation by the licensee or his

or its agents, officers, servants, or

employees, on the licensed premises, or

elsewhere while in the scope of

employment, of any of the laws of this

state or of the United States, or

violation of any municipal or county

regulation in regard to the hours of

sale, service, or consumption of

alcoholic beverages, or engaging in or

permitting disorderly conduct on the

licensed premises, or permitting another

on the licensed premises to violate any

of the laws of this state or of the

United States; ...

(b) Violation by the licensee or, if

a corporation, by any officers thereof,

of any laws of this state or any state

or territory of the United States.

(c) Maintaining a nuisance on the

licensed premises.

15. Section 823.10, Florida Statutes, declares a place or building where

controlled substances are illegally kept, sold, or used, to be a nuisance.

Section 893.13(2)(a)5, Florida Statutes, makes it unlawful for any person:

To keep of maintain any store, shop,

warehouse, dwelling, building, vehicle,

boat, aircraft, or other structure or

place which is resorted to by persons

using controlled substances in violation

of this chapter for the purpose of using

these substances, or which is used for

keeping or selling them in violation of

this chapter.

16. Cocaine is a controlled substance. It is a violation of state law to

sell, use, deliver, or possess cocaine. Sec. 893.13, Fla. Stat.

17. In the recommended order in Department of Business Regulation,

Division of Alcoholic Beverages and Tobacco v. Alejandrine Mora and Felix

Aristides, d/b/a/ Las Tunas Market and Cafeteria, DOAH Case Nos. 88-1604 and 88-

1608 (RO issued 4/29/88), with regard to facts remarkably similar to the facts

in this case, the Hearing Officer concluded:

The proof is clear and convincing that

patrons of the licensed premises possessed,

sold, and delivered controlled substances on

the licensed premises in violation of the

law. In the instant case, the violations of

law were so numerous and flagrant as to

compel the conclusion that respondents

fostered, condoned or negligently overlooked

them. Lash, Inc. v. State, Department of

Business Regulation, 411 So.2d 276 (Fla. 3d

DCA 1982), and Pauline v. Lee, 147 So.2d 359

(Fla. 2d DCA 1962). Under such

circumstances, the evidence supports the

revocation of respondents' licenses.

18. The same conclusion is warranted by the evidence in this case. The

repeated and flagrant violation of the drug laws on the licensed premises in

this case gives rise to a presumption that such activity was at least

negligently overlooked by the licensee.

RECOMMENDATION

On the basis of all of the foregoing, it is recommended that the Division

of Alcoholic Beverages and Tobacco enter a final order in this case revoking the

Respondent's alcoholic beverage license number 23-3568, series 2-COP, for the

premises located at 155 Ocean Drive, Miami Beach, Dade County, Florida.

DONE AND ENTERED this 19th day of April, 1988, at Tallahassee, Florida.

________________________________

MICHAEL M. PARRISH

Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

[phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 19th day of April, 1988.

APPENDIX TO RECOMMENDED ORDER

IN CASE NO. 88-1096

The following are my specific rulings on all of the proposed findings of

fact submitted by all parties.

Findings proposed by Petitioner

Paragraph 1: Accepted.

Paragraph 2: Rejected as subordinate and unnecessary details.

Paragraph 3: Rejected as constituting subordinate and unnecessary details.

Further, some details proposed in this paragraph are not supported by clear and

convincing evidence.

Paragraphs 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, and 19:

Accepted in substance, with many subordinate and unnecessary details omitted.

Paragraph 20: Rejected as irrelevant.

Paragraph 21: Accepted in substance.

Findings proposed by Respondent

(None)

COPIES FURNISHED:

Katherine A. Emrich, Esquire

Assistant General Counsel

Department of Business Regulation

The Johns Building

725 South Bronough Street

Tallahassee, Florida 32399-1000

Gino P. Negretti, Esquire

44 West Flagler Street

Miami, Florida 33130

Stephen R. MacNamara, Secretary

Department of Business Regulation

The Johns Building

725 South Bronough Street

Tallahassee, Florida 32399-1000

Joseph A. Sole, Esquire

General Counsel

Department of Business Regulation

The Johns Building

725 South Bronough Street

Tallahassee, Florida 32399-1000

Leonard Ivey, Director

Division of Alcoholic Beverages and Tobacco

The Johns Building

725 South Bronough Street

Tallahassee, Florida 32399-1000