[EDITOR'S NOTE: THE ORIGINAL SLIP OPINION CONTAINED ILLEGIBLE WORDS AND/OR MISSING TEXT.]
WOLIN, District Judge
Stuart Rhodes and Ingrid Rhodes, individually, Rhodestar Realty Company ("Rhodestar"), and Omni Distribution Systems, Inc. ("plaintiffs") filed this action claiming that the Township of Saddle Brook, Members of the Town Council of Saddle Brook, Raymond Santa Lucia, John Sistaro, Robert Kugler, Robert White, John Rendzia, Charles Cerone, and Joseph Carroll ("defendants") violated their civil rights. Prior to the institution of this action, defendant Saddle Brook filed an action in the Superior Court of New Jersey against Stuart Rhodes, Rhodestar, and A.B. Family Centers, Inc. ("AB") in which Saddle Brook moved to restrain Stuart Rhodes, Rhodestar, and AB from using a piece of real property to sell and rent sexually explicit merchandise and videos. Saddle Brook argued that the use of the property violated Township Ordinances and N.J.S.A. 2C:34-7, which regulates the location of sexually oriented businesses. The trial court denied Saddle Brook's requests for a temporary restraining order and a preliminary injunction, and ruled that Saddle Brook's Peace and Good Order Ordinance was unconstitutional and that N.J.S.A. 2C:34-7 was unconstitutional as applied. Defendants now move for summary judgment based on the entire controversy doctrine. The Court finds that the entire controversy doctrine bars plaintiffs' claims.
Facts and State Court Proceedings
Rhodestar owns a piece of real property known as 205 Route 46, Saddle Brook, NJ. In 1995, Route 46 Video, Inc. became plaintiffs' tenant. Route 46 Video wanted to engage in the business of selling and renting sexually explicit merchandise and videos.
On April 12, 1995, defendant John Sistaro, the Saddle Brook Construction Official, issued Rhodestar a permit, which provided a continuing Certificate of Occupancy for the operation of a video store at 205 Route 46. In May 1995, Sistaro voided the Certificate of Occupancy after discovering the nature of Route 46 Video's business. In response, Route 46 Video filed a Verified Complaint and Order to Show Cause against Saddle Brook in the Superior Court of New Jersey, Law Division, Bergen County. In seeking a temporary restraining order, Route 46 Video claimed that Saddle Brook violated its First Amendment rights. The trial court denied Route 46 Video's request, and the Appellate Division denied interlocutory appellate review. Ultimately, the trial court dismissed for lack of prosecution.
On September 7, 1995, plaintiff's new tenant, AB, submitted an application for a Certificate of Occupancy to John Sistaro. Sistaro denied the application because AB did not have site plan approval, because AB had not shown that the parking for the store complied with the zoning ordinance, and because AB's signs did not conform to the zoning ordinance. After the Board of Adjustment denied AB's appeal, AB advised Sistaro that it opened its video business under the Certificate of Occupancy issued to plaintiffs on April 12, 1995. Sistaro determined that that Certificate was issued for a different purpose, but AB continued to operate its business. On January 4, 1996, defendants Council of Saddle Brook and Raymond Santa Lucia, Mayor and Administrator of Saddle Brook, passed the Peace and Good Order Ordinance, which prohibits the operation of an adult video store in Saddle Brook. AB also ignored Sistaro's cease and desist order.
On February 6, 1996, defendants filed a Verified Complaint by way of Order to Show Cause against Stuart Rhodes, Rhodestar, and AB in the Superior Court of New Jersey, Law Division, Bergen County, seeking to prevent AB from operating its business in violation of Township Ordinances and Orders issued by Sistaro. On February 7, 1996, the trial court denied defendants' application for a temporary restraining order. On March 22, 1996, the trial court entered an Order denying defendants' application for a preliminary injunction pending the outcome of a plenary hearing.
On April 15, 1996, defendants filed an Amended Complaint alleging that plaintiffs were in violation of N.J.S.A. 2C:34-7, which regulates the location of sexually oriented businesses in New Jersey. On or about May 6, 1996, plaintiffs and AB filed its Answer to the Amended Complaint, asserting, among other things, that the Township Ordinances and N.J.S.A. 2C:34-7 were unconstitutional. Plaintiffs did not, however, assert any counterclaims in their Answer, and they signed a Certification stating "(2) no other action or proceeding is contemplated; and (3) no other necessary party to be joined in the subject litigation is presently known." In addition, plaintiffs never filed a motion to assert a counterclaim.
The trial court permitted limited discovery between the time of plaintiffs' answer and the date of the hearing, which was June 12, 1996. On July 26, 1996, the trial court issued a written opinion in which it concluded that defendants selectively enforced its ordinances, that defendants' Peace and Good Order Ordinance violated the First Amendment of the United States Constitution, and that N.J.S.A. 2C:34-7 was unconstitutional as applied by defendants. On September 9, 1996, the trial court entered an Order of Judgment granting the Certificate of Occupancy.
Defendants appealed the trial court's judgment. The Appellate Division granted the Attorney General's motion to intervene. The parties have briefed their positions, and they are waiting for oral argument.
On January 9, 1997, plaintiffs filed their Complaint in this Court. The crux of the Complaint is
that defendants set out on a plan of harassment and intimidation geared towards the singular purpose of disrupting and making it impossible for plaintiffs and plaintiffs' tenant to conduct business. Such acts included improper revocation of a previously issued certificate of occupancy; improper and unnecessary inspections and citations; police harassment; and the removal of substantially all available parking for plaintiffs' property.
(Pls. Br. at 7). Many of the facts alleged in the Complaint recite the problems plaintiffs and Route 46 Video had with defendants. See Compl. PP 18-50. Moreover, plaintiffs allege many facts that occurred prior to the date that defendants instituted their state action or before the state court conducted its hearing. See Compl. PP 18-50. Plaintiffs also contend that defendants continue to harass and intimidate them.
Defendants have moved for summary judgment, arguing that "the Entire Controversy Doctrine required Plaintiffs to bring all their claims arising out of the subject controversy in the two earlier state actions." (Defs. Br. at 5).
1. Standard for Summary Judgment
Summary judgment shall be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). In making this determination, a court must draw all reasonable inferences in favor of the non-movant. See Meyer v. Riegel Prods. Corp., 720 F.2d 303, 307 n.2 (3d Cir. 1983), cert. dismissed, 465 U.S. 1091, 104 S. Ct. 2144, 79 L. Ed. 2d 910 (1984). Whether a fact is "material" is determined by the substantive law defining the claims. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986); United States v. 225 Cartons, 871 F.2d 409, 419 (3d Cir. 1989).
"At the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 249, 106 S. Ct. at 2511. Summary judgment must be granted if no reasonable trier of fact could find for the non-moving party. See id.
2. 28 U.S.C. § 1738
The Full Faith and Credit Act provides:
Such Acts, records and judicial proceedings or copies thereof, so authenticated, shall have the same full faith and credit in every court within the United States and its Territories and Possessions as they have by law or usage in the courts of such State, Territory or Possession from which they are taken.
28 U.S.C. § 1738. As the Supreme Court has stated, "a federal court must give the same preclusive effect to a state-court judgment as another court of that State would give." Parsons Steel, Inc. v. First Alabama Bank, 474 U.S. 518, 523, 106 S. Ct. 768, 771, 88 L. Ed. 2d 877 (1986); see also Peduto v. City of N. Wildwood, 878 F.2d 725, 728 (3d Cir. 1989) (same). The Full Faith and Credit Act has been extended to civil rights actions brought pursuant to 42 U.S.C. § 1983. See Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 76, 104 S. Ct. 892, 893, 79 L. Ed. 2d 56 (1984); Allen v. McCurry, 449 U.S. 90, 97, 101 S. Ct. 411, 416, 66 L. Ed. 2d 308 (1980).
Federal courts do not, however, give full faith and credit to state court judgments when the party in the state court did not have a full and fair opportunity to litigate her claim. See, e.g., Kremer v. Chemical Constr. Corp., 456 U.S. 461, 480-81, 102 S. Ct. 1883, 1897, 72 L. Ed. 2d 262 (1982); Allen, 449 U.S. at 95, 101 S. Ct. at 415. A state court is deemed to have given a party a full and fair opportunity to litigate her claim if the court complies with the minimum procedural requirements of the Fourteenth Amendment's Due Process Clause. See Kremer, 456 U.S. at 481, 102 S. Ct. at 1897-98. Thus, in this instance, the Court must determine the preclusive effect that the trial court would give its judgment in the Saddle Brook summary proceeding, and must determine whether the first proceeding comports with the Due Process Clause.
3. The Entire Controversy Doctrine
"The entire controversy doctrine seeks to assure that all aspects of a legal dispute occur in a single lawsuit." Olds v. Donnelly, 150 N.J. 424, 431, 696 A.2d 633 (1997). The doctrine contains two aspects: (1) claims joinder and (2) party joinder. Claims joinder "requires that parties should present all affirmative claims and defenses arising out of a controversy." Id. (citations omitted). Party joinder "requires the mandatory joinder of all parties with a material interest in a controversy." Id. at 432 (citation omitted).
The entire controversy doctrine serves three purposes:
(1) to encourage the comprehensive and conclusive determination of a legal controversy; (2) to achieve party fairness, including both parties before the court as well as prospective parties; and (3) to promote judicial economy and efficiency by avoiding fragmented, multiple and duplicative litigation.
Mystic Isle Dev. Corp. v. Perskie & Nehmad, 142 N.J. 310, 322, 662 A.2d 523 (1995).
In essence, "the doctrine fosters the goals of efficient judicial administration and fairness" to parties. Joel v. Morrocco, 147 N.J. 546, 548, 688 A.2d 1036 (1997) (quotation omitted).
The entire controversy doctrine is so embedded in the New Jersey legal system that it is contained in the 1947 New Jersey Constitution:
Subject to rules of the Supreme Court, the Law Division and the Chancery Division shall each exercise the powers and functions of the other division when the ends of justice so require, and legal and equitable relief should be granted in any cause so that all matters in controversy between the parties may be completely determined.