Mediation fails in $5M+ federal suit over pet shop raid - WRCBtv.com | Chattanooga News, Weather & Sports

Mediation fails in $5M+ federal suit against McKamey, city over pet shop raid

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CHATTANOOGA (WRCB) -- The City of Chattanooga and McKamey Animal Center face a $5 million federal lawsuit next month over a 'raid' that seized puppies and shut down a pet store in Hamilton Place Mall almost three years ago.

A court-ordered mediation session failed to reach a settlement Wednesday afternoon. The case is set for trial in U.S. District Court in Chattanooga February 11.

In its lawsuit, United Pet Supply, Inc., parent company of The Pet Shop, alleges that the City of Chattanooga and McKamey Animal Center engaged in "deliberate efforts" to "damage and destroy" a lawful pet business based on "ideological antipathy to pet stores."

The complaint centers on a raid that McKamey officers conducted June 15, 2010 at the Pet Shop at Hamilton Place, barely a month after the store had acquired a 'dealer's permit' to comply with changes to Chattanooga's City Code.

United Pet Supply maintains that McKamey officer Marvin 'Jay' Nicholson had visited the Pet Shop seven times in March and April, after the city contracted with McKamey for animal code enforcement.

"On none of these seven occasions was the Pet Shop issued a single citation for any violation of the revised City Code," the suit states.

In court testimony nine days after the raid and seizure, Nicholson testified that officers found "feces still in the pans" in dog pens and cages.

"Feces running out of the pans," Nicholson said. "The cleanliness of the area was just awful." 

The suit alleges that McKamey timed the raid intentionally, before the Pet Shop opened, so that employees would have had no opportunity to clean up the animal waste that had accumulated after closing the previous evening.

McKamey director Karen Walsh defended her officers' actions in an interview with Channel 3 the day of the raid.

"This is our job," Walsh said.  "This is what we have to do. If we don't protect the animals, nobody else will."

Walsh and city officials have said the raid occurred after an on-line petition pleaded for action. The petition contained more than 4,000 electronic signatures.  

But the suit alleges that McKamey created the petition and actively solicited signatures.

"The unlawful goal was to drive the Pet Shop out of business in Chattanooga," the lawsuit alleges.

United Pet Supply Inc. is seeking $5 million compensatory damages, and $5 million punitive damages alleging:

  • The taking of its license violated its Constitutional right to due process (no hearing).
  • The taking of its animals and business records also violated due process.
  • The raid violated Fourth Amendment protections against 'unreasonable search and seizure.
  • McKamey abused the legal process by prosecuting the Pet Shop with an 'ulterior motive'; to unlawfully extract the payment of money and surrender of property.
  • McKamey, its operating trust, and three employees/directors seized property and animals without legal justification.
  • The actions interfered with the Pet Shop's business relationship to its landlord and breached its lease.
Chattanooga City Court ordered the Pet Shop's permit returned July 21, 2010, on grounds that a lack of a hearing meant that it never had been revoked.

The City of Chattanooga returned the permit but not the dogs September 3, 2010, the suit alleges.

The Pet Shop retrieved the dogs in October 2010. But by then, the suit alleges, they were "no longer puppies, and some were in poor health," making them unsalable as pets.

Wednesday's mediation hearing occurred only after McKamey and the City of Chattanooga filed motions to require it, and United Pet Supply Company had tried to avoid it.

Mediation is "inappropriate" and "will not assist in narrowing issues," its attorneys wrote in its December 28 response. 

"We have no settlement offer on the table."

"This is false," wrote Deputy City Attorney Valerie Malueg in a Joint Reply January 2. 

The Joint Reply asserts that McKamey's oversight Board (Animal Care Trust) twice asked United Pet Supply to make its demands known prior to Walsh beginning her deposition October 16. Attorneys would ask again in late October, early November, and finally on November 27, with no response.

Chief U.S. District Judge Curtis Collier viewed the parties' actions as a failure to communicate in his order to mediate, and in his naming of Federal Magistrate Judge William B. Mitchell Carter as the 'neutral party.'

"I cannot tell you what the parties discussed, nor could I reveal the terms of a settlement if it were to be reached," Judge Carter told Eyewitness News, Wednesday afternoon.

"All I could say is that a settlement had been reached."

It had not. A full settlement would have required agreement of all six parties; United Pet Supply, the City of Chattanooga, McKamey Animal Center, and three McKamey employees acting in their individual and official capacities; Director Walsh, Officer Nicholson, and Operations Manager Paula Hurn.

"Neither Mayor Littlefield nor the City Attorney will comment on this result, as it is all pending litigation," Mayor's spokesman Richard Beeland told Eyewitness News, Wednesday afternoon.

Barring unforeseen developments, the case is set for pre-trial conference February 6, with trial to commence February 11, 2013.

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