Suit Over Campaign to Close Bar May Proceed

(CN) - A Philadelphia nightclub may sue the neighborhood association that allegedly badmouthed its "upscale urban" black and Latino patrons on Twitter, a federal judge ruled.

Marc Stein says he opened 626 Front LLC aka Aura Restaurant and Lounge to cater primarily to an "upscale urban" black and Hispanic demographic in Philadelphia's Northern Liberties section on Jan. 28, 2012.

In order to have a disc jockey and dancing Stein had to apply for a special assembly and amusement license, for which he allegedly obtained all the necessary prerequisites.

But the Philadelphia Board of Review denied his application on May 29, 2012, and the decision was affirmed on appeal.

Stein later sued the city, the Northern Liberties Neighbors Association (NLNA), and over a dozen others, claiming they conspired against him due to his clients' race.

According to Stein, the police department opposed his application because the NLNA attributed negative activity in the area solely to his bar and claimed it was operating illegally.

He further asserts several community members engaged in a continuous campaign to inhibit his business operations, photographing his patrons and their activities, and making negative comments to staff and customers at events.

Neighbors also allegedly attacked the bar on Twitter, calling it "our block's nuisance dance club," and celebrating the club's potential closing after it lost its appeal, the complaint says.

Stein says the badmouthing of his business wasn't restricted to Twitter, but was also carried out on blogs and through emails. He also charges the neighbors filed a number of unfounded complaints with the police department.

His complaint, filed in August, asserts violations of his rights under the First and 14th Amendments, U.S. Code Sections 1983 and 1981, and various state laws.

The Neighbors Association, President Matt Ruben, and six members moved to dismiss.

Chief U.S. District Judge Petrese Tucker partially denied the motion last week, finding that though Stein is not a racial minority, his 1981 claims against the NLNA and Ruben survive.

Stein sufficiently pleaded that Ruben took additional actions to close the bar after learning of its black and Latino target demographic, according to the ruling.

"Plaintiff has a basis for remedy under Section 1981 because he desires to contract and do business with African Americans and Hispanic persons who patronize his club, but was allegedly unable to obtain the necessary special assembly license because of defendant's discriminatory conduct," Tucker wrote.

Stein's claim that Ruben accused the bar of operating illegally at a neighborhood meeting on July 3, 2012, is not judicially prejudiced "because defendants have done nothing more than to make a cursory argument that the statements made at this NLNA meeting were taken into account by the city," the ruling states.

But the court dismissed some of Stein's defamation claims as time-barred, along with his Section 1981 claim against some alleged members of the NLNA, including David Witz.

"Plaintiff fails to allege any intent to discriminate on the basis of race by defendant David Witz," Tucker wrote. "Plaintiff does plead facts that defendant engaged in hostile activity in order to remove plaintiff from the community, but simply does not plead any facts establishing a racially discriminatory intent behind these actions."

Stein may amend his claim that the defendants tortiously interfered with his ability to book celebrity appearances and banquet hall services, the judge ruled.

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