Case 1• 14- cv-00346- LG- RHW Document 2 Filed 09/08/ 14 Page 1 of 1

on

AO 440( Rev. 06/ 12) Summons in a Civil Action

UNITED STATES DISTRICT COURT

Soen Peet- df M

ROGER APPLEWHITE, INDIVIDUALLY AND ONBEHALF OF

MARBLE SPRINGS HOUSE, LLC

Plainti:5s)

v. Civil Action No. /' j 14( V 94(Y L — 41WTHE CITY OF OCEAN SPRINGS, MISSISSIPPI

Defendant(s)

SUMMONS IN A CWIL ACTION

To: (Defendant' s name and address) THE CITY OF OCEAN SPRINGS, MISSISSIPPIdo Mayor Connie Moran1018 Porter Avenue

Ocean Springs, MS 39564

A lawsuit has been filed against you.

Within 21 days after service of this summons on you( not counting the day you received it)— or 60 days if you

are the United States or a United States agency, or an officer or employee of the United States described in Fed. R. Civ.P. 12( a)( 2) or( 3)— you must serve on the plaintiff an answer to the attached complaint or a motion under Rule 12 ofthe Federal Rules ofCivil Procedure. The answer or motion must be served on the plaintiff or plaintiff' s attorney,whose name and address are:

Carter& Jordan, PLLC

1101 iberville Drive

Ocean Springs, MS 39564

If you fail to respond, judgment by default will be entered against you for the relief demanded in the complaint.You also must file your answer or motion with the court.

ARTHUR JOHNSTON

CLERK OF COURT

Date' I V t_ 1 4 1 JaLtature ofCI or Deputy Clerk

AO 440( Rev 06/ 12) Summons in a Civil Action( Page 2)

Civil Action No. 1. 14cv346 LG- RHW

PROOF OF SERVICE

This section should not befiled with the court unless required by Fed. R. Civ. P. 4( 1))

This summons for( name of individual and title, ifan})

was received by me on( date)

CI I personally served the summons on the individual at( place)on (date) or

O I left the summons at the individual' s residence or usual place of abode with (name)

a person of suitable age and discretion who resides there,

on (date) and mailed a copy to the individual' s last known address; or

O I served the summons on( name of individual) who is

designated by law to accept service of process on behalf of(name oforganization)on (date) or

Q I returned the summons unexecuted because or

Other( specify)

My fees are $ for travel and$ for services, for a total of$ 0. 00

I declare under penalty of perjury that this information is true.

Date:Server' s signature

Printed name and title

Server' s address

Additional information regarding attempted service, etc:

Case 1: 14- cv-00346- LG- RHW Document 1 Filed 09/08/ 14 Page 1 of 8

SOUTHERN DISTRICT OF MISSi€ SIPP4

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DIS1'RIClPOrMISSISSIPPI, SOUTHERN DIVISION SEP 08 2011E

ROGER APPLEWHITE, individually and on behalf DEPUTY

of MARBLE SPRINGS HOUSE, LLC

VERSUS CAUSE NO. , ( it &LILPLJ1VI

CITY OF OCEAN SPRINGS, MISSISSIPPIand JOHN DOES 1- 5

COMPLAINT

JURY TRIAL DEMANDED)

COME NOW the Plaintiffs, MARBLE SPRINGS HOUSE, LLC, by and through Roger

Applewhite (also a Plaintiff individually), by and through their attorneys of record, CARTER &

JORDAN, PLLC, and would show unto the Court the following, to wit:

I.

Plaintiff, MARBLE SPRINGS HOUSE, LLC (" Marble Springs"), is a Mississippi

Limited Liability Company, located in Jackson County, Mississippi, with its primary business

address at 716 Cox Avenue, Ocean Springs, Mississippi. Marble Springs files this suit by and

through Roger Applewhite, its principal, who is also an individual Plaintiff, an adult resident of

Jackson County, Mississippi.

II.

Defendant, the City of Ocean Springs, Mississippi (" Ocean Springs" or " the City"), is a

municipality/municipal corporation under the laws of the State of Mississippi, which may be

served with process in the time and manner provided by law through service on its mayor or

municipal clerk. Defendants John Does 1- 5 are individuals whose identities are currently

unknown who may be liable to Plaintiff in all or in part for the reasons hereinbelow.

1

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JURISDICTION AND VENUE

III.

Jurisdiction is proper in this Court pursuant to 28 U. S. C. § 1331. Venue is proper in this

Court as all pertinent actions or occurrences took place within the Southern District of

Mississippi and Defendant Ocean Springs is located therein.

FACTS

IV.

Marble Springs' is the owner of a parcel of real property at 1 101 Iberville Drive, Ocean

Springs, Mississippi, as well as the building and fixtures located thereon ( hereinafter collectively

the Iberville property"). The Iberville property is located in a C- 3 Highway Commercial district

as defined by the Zoning Ordinance of Ocean Springs. Marble Springs purchased the Iberville

property several years ago as an investment property which Marble Springs intended to rent to

tenants to earn income. Marble Springs actively sought to rent out the Iberville property in order

to earn income and to pay the existing mortgage thereon.

V.

In or about August 2011, after the Iberville property had been vacant and without a tenant

for a number of years, Marble Springs entered into a lease for the Iberville property with

Psycamore, L.L.C. (" Psycamore"). Psycamore is a healthcare entity which intended to provide

outpatient/day treatment in the behavioral health field at the Iberville property. According to the

plain reading of the applicable zoning laws, Psycarnore' s intended use was fully allowed. The

lease between Marble Springs and Psycamore would also allow Psycamore to purchase the

Iberville property from Marble Springs.

Plaintiffs herein will collectively refer to both of the Plaintiffs as" Marble Springs" herein.

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VI.

In anticipation of the business arrangement with Psycamore, Marble Springs made

significant investments into the property, including expensive renovations. However, as

Psycamore began seeking an occupancy permit for the business at the Iberville property,

problems with the City began to arise. Some individuals began complaining to the Mayor about

locating Psycamore on the Iberville property, so the occupancy permit issue for Psycamore was

sent to the City Planning Commission to examine whether a zoning issue existed. Ocean Springs

Planning Director Eric Meyer issued a report on September 9, 2011, to the mayor ( Connie

Moran) and members of the Planning Commission concerning the zoning issue, and stated that

the vast majority of the medical offices and clinics in Ocean Springs were located in C- 3 zoning

districts, and that it would appear Psycamore' s intended use fit within the allowable uses for that

district.

VII.

On September 12, 2011, the Planning Commission held a hearing on the issue of the

Certificate of Occupancy for Psycamore. On September 19, 2011, Ocean Springs, through its

City Attorney, sent a letter to Psycamore' s attorney stating that no Certificate of Occupancy

would be issued to Psycamore, as the specific use was not listed in the applicable zoning

ordinances. Instead, he advised, Psycamore would have to submit a Use Permit Application.

Psycamore expressed its disagreement, but nevertheless complied with the City' s wishes and

submitted a Use Application Permit on September 22, 2011.

VIII.

The City Planning Commission issued a Public Notice for a hearing to be held October

25, 2011, stating:

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The Planning Commission shall consider the application of Dr. Sudhakar

Madakasira representing Psycamore, LLC requesting a Use Permit to operate anoutpatient psychiatric program providing partial hospitalization and intensiveoutpatient therapy to mentally ill patients who are high functioning, needing aserene, private, homelike setting to facilitate their recovery within the C-3Commercial Highway zoning designation for the parcel addressed as 1101Iberville Drive with parcel identification number 60119164.000.

Prior to the October 25, 2011 hearing, the Community Development and Planning Department of

Ocean Springs prepared an eight page Planning Commission Report that concluded that

Psycamore' s intended use of the Iberville property was a legal use for C- 3 Highway

Commercial, that a Use Permit was unnecessary, and that there was no reason to suggest that a

psychiatric office or clinic of the proposed size and nature would have any detrimental impacts

on property values or public safety.

IX.

At the October 25, 2011 Planning Commission meeting, the members voted twice,

resulting in a 3- 3 tie each time, and the Planning Commission decided not to make a formal

recommendation to the City regarding the zoning issue.

X.

On October 27, 2011, Eric Myer submitted a ten page report to the Mayor and Board of

Aldermen of Ocean Springs regarding the Use Permit application of Psycamore, again

expressing that no use permit should be required, and that other similarly situated clinics and

medical facilities were never subject to the same scrutiny, even though falling within a C- 3

zoning district as well.

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XL

Ocean Springs held a City Council meeting on November 1, 2011, wherein the Use

Permit Application of Psycamore was placed on its agenda. 2 Ocean Springs chose to take the

matter under advisement pending further review by the Board of Aldermen.

XII.

A special meeting of the City Council was held on November 29, 2011,= and the Board of

Aldermen denied the use permit to Psycamore.

XIII.

Psycamore timely appealed to the Circuit Court of Jackson County, which found that

there was no substantial evidence to support the City' s decision, and thus reversed the decision

on December 21, 2012. The City of Ocean Springs appealed to the Mississippi Supreme Court.

In affirming the Circuit Court' s decision, the Mississippi Supreme Court held, " Because the city

planning commission ignored its own definition, past practices and all of the relevant evidence

when it denied Psycamore' s certificate of occupancy, we find that the denial was clearly

arbitrary and capricious." City of Ocean Springs, Mississippi v. Psycamore, LLC, 124 So. 3d

658 (¶ 31) ( Miss. 2013). 4

XIV.

Having been alerted to the City' s actions, the United States Department of Justice

USDOJ") began an investigation under Title II of the Americans with Disabilities Act

ADA"). 5 The USDOJ' s investigation found that Ocean Springs had indeed violated the ADA

z The minutes, documents and comments submitted, which are part of the official record, are incorporated herein byreference as if fully reproduced herein.

The minutes, documents and comments submitted, which are part of the official record, are incorporated herein byreference as if fully reproduced herein.

Said opinion and the factual and legal recitations therein are fully incorporated by reference as if fully reproducedherein.

5 42 U.S. C. 12131- 12134; 28 C. F.R. Part 35.

5

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and set forth its findings and recommendations in a letter dated August 15, 2014. See Exhibit

A," Letter findings of USDOJ. Inter alia, the USDOJ stated that Ocean Springs must, due to the

violation, compensate the aggrieved persons for injuries suffered as a result of the City' s

conduct, and to remedy its past violations. The USDOJ further recognized the actions of the City

as being arbitrary and capricious according the findings of the Mississippi Supreme Court.

Lastly, the USDOJ advised the aggrieved parties of their right to file suit privately under Section

203 of the ADA.

XV.

Marble Springs had its lease and purchase agreement with Psycamore terminated

effective January 31, 2012, as a direct result of the arbitrary, capricious and discriminatory

actions of the City of Ocean Springs, by and through its officials, agents and employees. See

Exhibit ` B," Letter from Psycamore to Marble Springs dated January 4, 2012. The Iberville

property remained vacant, without a paying tenant, from February 1, 2012, through September

2013. Marble Springs was further forced to negotiate a lower lease amount than it had with

Psycamore in order to mitigate its ongoing damages. Marble Springs incurred significant

economic damages that are ongoing. Marble Springs and its principal, Roger Applewhite,

further incurred noneconomic damages, including but not limited to mental anguish, emotional

distress, anxiety and other damages to be proven at trial.

XVI.

For the reasons hereinabove and to be shown at trial, Marble Springs' rights under the

ADA were violated and it is entitled to compensation and/ or restitution as an aggrieved person or

entity associated with providing services to those with disabilities or perceived disabilities.

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Marble Springs was damaged directly thereby and makes claim for all damages allowable under

federal and state law.

XVII.

For the reasons hereinabove and as to be further shown at trial, including but not limited

to interference with actual protected property rights, Marble Springs' substantive due process

rights, including but not limited to those under the Fifth and Fourteenth Amendments to the

United States Constitution, were directly violated by the City' s actions, omissions and statutory

violations, for which it makes claim against the City of Ocean Springs. Marble Springs was

directly damaged thereby and makes claim for all damages allowable under federal and state law.

XVIII.

For the reasons hereinabove and as to be shown at trial, Marble Springs' rights under the

Equal Protection Clause were directly violated by the City' s actions, omissions and statutory

violations, in that it was treated differently from similarly situated entities,' with no legitimate or

rational basis for such differential treatment. Further, to the extent the City claims enforcement

of a zoning ordinance to justify its actions, it attempted to enforce its ordinance selectively in

violation of the Equal Protection Clause for improper reasons, including but not limited to

discriminatory reasons and the desire to prevent the exercise of a constitutional right. Marble

Springs was directly damaged thereby and makes claim for all damages allowable under federal

and state law.

WHEREFORE, PREMISES CONSIDERED your Plaintiffs demand judgment of and

from Defendant( s) as follows:

a) Compensatory damages for past, present and future economic damages

suffered or to be suffered by Plaintiffs, both economic and noneconomic;

b E. g., the numerous other medical facilities located in the City' s C- 3 zones, including mental health facilities.

7

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b) Prejudgment interest;

c) Attorney' s fees and expenses;

d) Such other relief as may be proper under the premises.

ON THIS, the ` day of fef,4 t ,, e( , 2014.

Respectfully submitted,ROGER APPLEWHITE, Individually andfor MARBLE SPRINGS HOUSE, LLC

BY: CARTER & JORDAN, PLLC

BY:

KRISTOP}4ER)W. CARTER

CARTER & JORDAN, PLLC

P. O. Box 2040Ocean Springs, MS 39566

228.202. 1107 Telephone

228.202. 1108 Facsimile

Kris@CarterJordanLaw.com

Al(a,,CarterJordanLaw. corn

8

w

Case 1: 14-cv-00346- LG- RHW Document 1- 1 Filed 09/08/14 Page 1 of 8

n, U.S. Department of Justice

1 Civil Rights Division

Disahtlity Rights Section- NYA950 Pennsylvania Ave, NWWashington, DC 20530

August 15, 2014

By Electronic& First Class Mail

Mayor Connie Moran .

City of Ocean Springs1018 Porter Avenue

Ocean Springs, MS 39564

Mr. Robert W. WilkinsonDogan& Wilkinson, PLLC

914 Washington Avenue

Ocean Springs, MS 39564

Re: The United States' Findings Based on its Investigation ofthe City of Ocean Springs, Mississippi, Pursuant to theAmericans with Disabilities Act, DJ No. 204-41- 157

Dear Mayor Moran:

The United States Department of Justice (" Department") makes the following findingsand conclusions based on its investigation of the City of Ocean Springs, Mississippi (" City"), for

alleged violations of Title II of the Americans with Disabilities Act of 1990(" ADA"), as

amended, 42 U.S. C. §§ 12131- 12134, and its implementing regulation, 28 C.F.R. Part 35.

Title II of the ADA prohibits disability discrimination in all activities of localgovernment entities, including zoning decisions. See 42 U.S, C. § 12132; 28 C.F.R. § 35. 130.

The City is a public entity under the ADA and subject to the ADA' s nondiscrimination mandate.See 42 U.S. C. § 12131; 28 C.F.R. § 35. 104. This nondiscrimination mandate requires the City toprovide equal services, programs, and activities to entities that serve individuals with disabilitiesand to ensure that the City' s zoning decisions do not discriminate against individuals withdisabilities and entities associated with them. See 28 C.F.R. § 35. 130( b), ( g). The Department is

authorized to investigate allegations of discrimination and to file a civil action if the AttorneyGeneral finds a violation of the ADA. 42 U.S. C. § 12133; 28 C.F.R. Part 35, Subpart F.

The Department finds that the City discriminated against Psycamore, LLCPsycamore"), an outpatient psychiatric treatment facility, because ofthe known actual and

perceived mental impairments of the patients treated there, and with whom Psycamore has aknown association, in violation of the ADA. Psycamore sought to operate in a zone allowing

I facilities for the examination and treatment ofhuman patients and should have been allowed tooperate without obtaining a use permit. But the City denied Psycamore' s certificate of

y x

IIIIIIIIIIIIMIIIOIIMIIIMIIIIIIIIIIIMIMIIIIIIIIIIIIMIIIIIMIIIIIIIIIIIIIIIIIIIIIIIMIMIIIIIIIIIIIIIIIIIIIIIMIIIIIIMIIIIIIII

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occupancy application, required it to seek a use permit, subjected it to public hearings, anddenied its use permit application—even though Psycamore' s proposed use was allowed under the

City' s zoning ordinance. The Mississippi Supreme Court found that the City' s decision wasarbitrary and capricious. City of Ocean Springs, Miss. v. Psycamore, LLC, No. 2013-CA-00118-SCT, at 11 ( Miss. Oct. 31, 2013).

The Department finds that the City based its decision on discriminatory beliefs, myths,and stereotypes about the types of patients with disabilities treated by Psycarnore and theirmental disabilities. The City violated the ADA when it denied Psycamore a certificate ofoccupancy, made it submit to a use permit process, and then denied it a use permit—all on these

illegal and discriminatory bases. A court enforceable agreement will be necessary: ( i) to educatethe City and its officials on the requirements of the ADA;( ii) to compensate Psycamore andother aggrieved persons for injuries suffered as a result of the City' s violations of the ADA; andiii) to reform the City' s zoning practices with respect to persons with disabilities and psychiatric

treatment facilities, in order to prevent future violations of the ADA. This letter is notice of ourfindings of fact and conclusions of law, and of the remediation that the City must take to bring itspolicies, practices, and procedures into compliance with the ADA, and to remedy past violations.See 28 C.F.R. Part 35, Subpart F.

I. STATUTORY AND REGULATORY BACKGROUND,

Congress enacted the ADA" to provide a clear and comprehensive national mandate forthe elimination of discrimination against individuals with disabilities." 42 U.S.C. § 12101( b)( l).

In so doing, Congress found that" physical or mental disabilities in no way diminish a person' sright to fully participate in all aspects of society, yet many people with physical or mentaldisabilities have been precluded from doing so because of discrimination." id. § 12101( a)( 1).

Congress further found that" discrimination against individuals with disabilities persists in suchcritical areas as . . . access to public services." Id. § 12101( a)( 3).

For these and other reasons, Congress enacted Title II of the ADA, which prohibitsdiscrimination against individuals with disabilities by public entities:

o qualified individual with a disability shall, by reason of such disability, beexcluded from participation in or be denied the benefits of the services, programs,or activities of a public entity, or be subjected to discrimination by any suchentity.

Id § 12132; 28 C.F.R. § 35. 130. This broad non-discrimination mandate protects individualswith disabilities from discrimination in all programs, services, or activities of the City.

Pursuant to a Congressional directive, 42 U.S. C. § 12134(a), the Department issued

regulations for Title II of the ADA, reflecting the ADA's nondiscrimination mandate. See 28C.F.R§ 35. 130( a). The ADA and its regulatory provisions prevent the City from, among otherthings: ( 1) denying an individual with a disability the opportunity to participate in or benefitfrom any aid, benefit, or service; ( 2) affording an individual with a disability an opportunity toparticipate in or benefit from an aid, benefit, or service that is not equal to that afforded others;

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3) providing different or separate aids, benefits, or services to individuals with disabilitiesunless necessary to provide such individuals with aids, benefits, or services that are as effective

as those provided to others); or( 4) limiting individuals with disabilities in the enjoyment of anyright, privilege, advantage, or opportunity enjoyed by others. Id. § 35. 130( b)( 1).

The City is further prohibited from utilizing criteria or methods of administration thathave the effect of discriminating against individuals with disabilities, or applying eligibilitycriteria that screen out or tend to screen out individuals with disabilities or any class ofindividuals with disabilities from fully and equally enjoying any service, program, or activity,unless such criteria can be shown to be necessary for the provision of the service, program, oractivity being offered. Id. § 35. 130(b)( 3),( b)( 8). Title II also requires that a public entity make

reasonable modifications to its policies, practices, or procedures when necessary to avoiddiscrimination on the basis of disability, unless the public entity can demonstrate that doing sowould fundamentally alter the nature of the service, program, or activity. id § 35. 130(b)(7).

Additionally, Title II of the ADA protects the rights of individuals and entities associatedwith persons with disabilities and prohibits excluding or otherwise denying equal services,programs, or activities to an individual or entity because of the known( actual or perceived)disability of an individual with whom the individual or entity has a known relationship orassociation. Id. § 35. 130(g). Title II further provides relief to any person alleging discriminationon the basis of disability, or any person aggrieved by the discrimination of a person on the basisof his or her disability. See 42 U.S.C. § 12133; see also 29 U.S.C. § 794a( the remedies,

procedures, and rights of which are incorporated into Title II by reference); 42 U.S. C. §§ 2000d-

2, 2000e- 5 ( incorporated into 29 U.S. C. § 794a by reference).

These provisions prevent the City from applying its zoning to discriminate againstindividuals with disabilities and entities associated with them.

H. FINDINGS AND CONCLUSIONS

A. Ocean Springs Zoning

The City' s zoning and land use activities are carried out by its Planning Department,Planning Commission, Mayor, and Board of Aldermen. Its Comprehensive Zoning Ordinance

Zoning Ordinance") governs the zoning process and divides the City into thirteen zoningdistricts, listing the permissible uses of property within the corresponding geographic areas.'Any occupant seeking to change the use of an existing structure must obtain either a certificate ofoccupancy or a use permit

2

When the proposed use is listed in the applicable district ordinance, the City' s PlanningDepartment must issue a certificate of occupancy. 3 If not, then a use permit must be obtained

after public notice and hearing and approval of the Board of Aldermen and Mayor.4 A use

Ocean Springs, Miss., Zoning Ordinance§§ 401- 412( 2007).

2 Ocean Springs, Miss., Zoning Ordinance§ 901. 2( 2007).Ocean Springs, Miss., Zoning Ordinance§ 901. 2( 1)( 2007).

4 Ocean Springs, Miss., Zoning Ordinance§ 408. 3( 2007).

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permit should be granted if the proposed use is" similar to or not in conflict with those usesspecifically permitted."

5

B. Psycamore

Psycamore is a private, mental health service provider for high-functioning adults andadolescents with serious mental disorders and psychosocial impairments. Psycamore is licensedas an" acute partial hospitalization" program: a program that provides medical supervision,nursing services, structured therapeutic activities and intensive psychotherapy( individual,family, and/or group) to individuals who are experiencing a period of such acute distress thattheir ability to cope with normal life circumstances is severely impaired. Psycamore is designedparticularly for individuals not in an inpatient setting or for those needing further services afterbeing discharged from a hospital.

Psycamore has offices in Flowood, Southaven, and Biloxi, Mississippi. At thesefacilities, it offers comprehensive treatment of major psychiatric disorders through intensiveoutpatient therapy programs with day and evening schedules. To be eligible for services,patients must have a psychiatric illness severe enough to interfere with daily function, but not torequire hospitalization. In 2011, when it applied for a certificate of occupancy and use permitfrom the City, approximately eighty percent of Psycamore' s clients had depression as a primarydiagnosis; others had anxiety, panic disorder, post-traumatic stress disorder, obsessive-compulsive disorder, and adjustment disorders. These mental impairments interfere with brainfunction, a major bodily function, and with patients' ability to perform various tasks ofdailyliving.

C. 1101 Iberville Drive

In August 2011, Psycamore attempted to open an outpatient psychiatric treatment facilityin an existing building at 1101 lberville Drive in Ocean Springs(" Property"). Due to the actions

of the City, Psycamore terminated its lease at the end of January 2012, just five months later.For nearly two years thereafter, from February 2012 through September 2013, the property wasfor sale or lease.

Iberville Drive features several businesses, as well as the Marble Springs Historic Parkand homes. Since 1984, the Property has been zoned C- 3 highway commercial. The Property islocated near a law firm, a psychologist' s office, and a realtor' s office. There are also severalbars, a tattoo parlor, a fast food restaurant, and a gas station not far from the Property. Theneighborhood to the east, beyond the Property and the park, is zoned R- 1 residential. The closestresidential home is diagonally across the street, and the next closest home is across the publicparking lot for the park. Prior uses of the Property include an attorney' s office and an insurancecompany. The Property is currently being used as law offices.

51d,

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D. Certificate of Occupancy

Psycamore leased the Property on August 1, 2011. On August 29, it posted a sign andran advertisements about its proposed psychiatric treatment facility. The next day, it submittedan application for a certificate of occupancy for use as a" Psychiatric Partial Hospitalization"program. The application noted that it would operate Monday through Friday, with no sessionlater than eight p.m.

In response," Friends of Iberville Drive" (" FID") formed to prevent Psycamore from

opening at the Property. A concern expressed by some was public safety due to the mentaldisabilities of Psycamore' s patients. A flier was circulated publicly and to City officials thatdepicted Psycamore as the psychiatric ward in the film, One Flew Over the Cuckoo' s Nest.

E. Special Call Meeting and Board of Aldermen Motion

The City repeatedly acted inconsistently with its zoning rules and usual practices. InSeptember 2011, the Board of Aldermen held a meeting to hear public comments onPsycamore' s certificate of occupancy application. Many comments focused on an alleged threatto property values and public safety posed by Psycamore' s patients due to their actual orperceived mental impairments. Because of the concerns raised in the comments, by motion theBoard of Aldermen instructed the Planning Department to research whether Psycamore' sproposed use was allowed, and instructed the Planning Department not to make a decision as towhether Psycamore' s proposed use was allowed by right, but only to make a recommendation tothe Planning Commission and Board ofAldermen. The Board thus required Psycamore to gothrough the use permit application process, without the Planning Department first determiningwhether a certificate ofoccupancy should be issued by right for a legally conforming use. TheBoard passed the motion over objection by the Planning Department. Accordingly, the PlanningDepartment researched Psycamore' s use, and issued a report(" Report") and recommendation to

the Planning Commission and Board of Aldermen.

F. Planning Department Report

The Planning Department' s Report(" Report") recommended that" the Planning

Commission find Psycamore to be a legal use within the C- 3 Highway Commercial zoningdistrict," because it is a" medical or paramedical clinic" as defined by the Zoning Ordinance.Consequently, a use permit was not needed, and a certificate of occupancy should have beenissued. In the alternative, the Report found that" Psycamore' s requested use [ was] similar to andnot in conflict with" a medical or paramedical clinic—a use" specifically allowed in C-3

Highway Commercial." As a result, the City should have issued Psycamore a use permit, TheReport also found that there was" no research to suggest that a psychiatric office or clinic of theproposed size and nature would have detrimental impacts on property values or public safety."

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G. Additional Public Hearinzs and Use Permit Application Under Protest

Although Psycamore' s proposed use— a medical or paramedical clinic—was permitted

by right in the C-3 highway-commercial district, the City required Psycamore to apply for a usepermit, and go through the public notice and hearing process, which it did under protest. ThePlanning Department' s Report was presented to the Planning Commission and Board ofAldermen at public hearings. At these hearings, the Planning Commission and Board ofAldermen also heard from proponents and opponents of Psycamore' s use permit application.Opponents argued that Psycamore was not a permitted use and conflicted with other usespermitted in the zoning district because of the types of patients treated by Psycamore, who theyalleged posed a threat to safety and would cause property values to decrease. FID submitted abrief to the City discussing the perceived dangers of people with mental health disorders,including generalizations, myths, and stereotypes about people with mental illness.

The City relied on the FID brief and comments and, on November 29, 2011, voted todeny Psycamore' s application for a use permit, citing traffic, the residential and historic nature ofthe area, and the substandard infrastructure on the street. The City expressly adopted thearguments in the FID brief—including specifically citing those sections of the brief that focusedon the threat of violence, crime, and substance abuse posed by Psycamore' s patients due tomental illness— but simultaneously stating that it was" not adopting any arguments regardingviolent crime" therein.

H. The City Violated the ADA by Denying Psycamore' s Applications Based onDisability

The Department finds that the City' s denials of Psycamore' s certificate of occupancy anduse permit applications— based on impermissible assumptions and unfounded stereotypes about

Psycamore' s patients because of their disabilities— violate the ADA. Psycamore is therefore an

aggrieved person under the ADA, as are those individuals and entities harmed by the City' sdiscriminatory actions. See 42 U.S. C. § 12133; see also 29 U.S.C. § 794a( the remedies,

procedures, and rights of which are incorporated into Title II by reference); 42 U.S. C. §§ 2000d-

2, 2000e- 5 ( incorporated to 29 U. S. C. § 794a by reference).

Due to the discriminatory actions of the City, Psycamore was prevented from opening aclinic at the Property and was delayed in opening its third clinic (now located in Biloxi) by fiveto six months. The City ignored its own definition, past practices, and relevant evidence when itrequired Psycamore to go through the use permit hearing process and again when it deniedPsycamore' s application for a use permit. As a result, the City created a precedent for singlingout certain medical facilities that treat patients with mental disabilities and applying a heightenedrequirement for them to locate in Ocean Springs. The City' s actions also perpetuated the stigmasurrounding mental health disorders.

Due to its professional association with persons with disabilities, Psycamore is a coveredentity protected by the ADA, as are other persons or entities associated with Psycamore and itspatients. See 42 U. S. C. § 12133; 28 C.F.R. § 35. 130( g); see also 28 C.F.R., pt, 35, App. A. TheCity discriminated against Psycamore because of its association with individuals with disabilities

6

Case 1: 14- cv-00346- LG- RHW Document 1- 1 Filed 09/ 08/ 14 Page 7 of 8

and, in the process, prevented the Property from being rented for a use permitted in the C-3highway-commercial zoning district based on discriminatory reasons. The City providedunequal services to, and made a decision that had the effect of discriminating against, Psycamoreand those associated with Psycamore) because it serves individuals with known disabilities.

The City thus violated the ADA when it denied Psycamore' s certificate of occupancy and usepermit applications.

IQ. REMEDIATION

To remedy the City' s violations, it must, at minimum:

1) Adopt a non-discrimination policy stating that the City will not engage in any act orpractice, directly or through contracting, licensing, or other arrangements, that has thepurpose or effect of unlawfully discriminating against any person with a disability, or anyperson or entity associated with a person with a disability, in violation of Title II of theADA—or otherwise discriminate on the basis of disability in violation of the ADA.

2) Train all City staff, volunteers, administrators, and officials involved in zoning—including the Planning Department, Planning Commission, Board of Aldermen, andMayor— on the requirements of the ADA and the rights of individuals with disabilities,

including the affirmative obligation of public entities to provide equal services, programs,and activities to entities that serve individuals with disabilities and to ensure that the

City' s zoning decisions do not discriminate against individuals with disabilities andentities associated with them.

3) Grant Psycamore a certificate of occupancy( and use permit if necessary) to operate apartial hospitalization program, or other psychiatric treatment facility, in any C-3 or C- 4zoned district in the City, including the Property located at 1101 Iberville Drive, shouldPsycamore choose to open in these districts in the City.

4) For any land use request involving persons with disabilities or an entity associated withthem that the City denies or grants with conditions in the next five years, make writtenfindings specifying the basis for the denial or the conditions imposed_

5) Hire a full-time ADA Coordinator to carry out the City' s responsibility for compliancewith Title II of the ADA and its implementing regulation.

6) Take other affirmative action to prevent discrimination based on disability by the City.

7) Pay compensatory damages, including damages for out-of-pocket expenses and lostprofits, to Psycamore and other aggrieved persons in an appropriate amount for injuriessuffered as the result of the City' s failure to comply with the requirements of Title II ofthe ADA, 42 U. S. C. §§ 12131- 12134, and its implementing regulation, 28 C.F.R. Part 35.

Case 1. 14- cv-00346- LG- RHW Document 1- 1 Filed 09/08/14 Page 8 of 8

IV. CONCLUSION

Please carefully consider these findings and conclusions by the Department. We are opento a dialogue to address the City' s discrimination and to reach an agreed resolution. In the eventthat the United States is unable to reach a resolution, it may take appropriate action, includinginitiating a civil action. See 42 U.S. C. § 12133; 28 C.F.R. Part 35, Subpart F. The Department

prefers to resolve this matter cooperatively through an agreed court-enforceable resolution tobring the City into compliance with the ADA, remedy harm, and prevent future violations. Tothis end, if the City is interested in an agreed resolution it must contact the United StatesDepartment of Justice within 14 days of the date of these findings and conclusions to notify theUnited States that it is willing to discuss resolution.

Please note that this letter is a public document, and we will share a copy of this letterwith Psycamore, as required by 28 C.F.R. Part 35, Subpart F. At any time, Psycamore may file aprivate suit pursuant to Section 203 of the ADA, 42 U.S. C. § 12133, regardless of the contents of

this letter and the Department' s findings in this matter. Please be advised that the City shall notdiscriminate or retaliate against any persons or entity because of their participation in this matter.See 42 U.S. C. § 12203.

If you have any questions regarding this letter, please contact me at( 202) 307-0663.

Sincerely,

Rebecca B. Bond

Chief

Disability Rights Section

cc: John B. Edwards, Esq.Amy L. St. Pe', Esq.Sudhakar Madakasira, M.D./Psycamore, LLC

William Guice, Esq.Roger Applewhite/Marble Springs House, LLCKristopher W. Carter, Esq.

8

Case 1: 14- cv-00346- LG- RHW Document 1- 2 Filed 09/08/ 14 Page 1 of 1

2540`Fiowood Drive

I(

flood, MS 39232

t Phone( 601) 939-5993

LYj PSCAMORE,} LLC

Fax( 601) 939.5935

A Psychiatric Partial Hospitalization, 7165-G Getwell Rood

38672intensive Outpatient Program and RAP Southaven, MS

Phone( 662) 349-2818Fox( 662) 349-3406

1101 lberville Drive

Ocean Springs, MS 39564

Phone( 228) 875-7287

January 4, 2012 Fox( 228) 875-7441

1- 877-PSYCH-4-U

Roger Applewhite1- 877-779-2448

www.psycomore.com

P. Q. Box 1443

Gautier, MS 39553

RE: Termination of Lease

Dear Roger;

I regret to inform you that Psycamore, LLG has no choice but to terminate its lease on 1101 ibervilleDrive, Ocean Springs, MS 39564 effective 1/ 31/ 2012. This action was necessitated by Psycamore' sinability to get a use permit from the city of Ocean Springs to operate its program in spite of properzoning. Attached is a check for nine thousand dollars($ 9,000.00) to cover the rental for the months of

October, November and December, 2011. Please apply the security deposit of three thousand dollars3, 000.00) for the rent for January.

As it is not Psycamore' s fault that the lease has to be terminated, along with the purchase option, I amrequesting that you return the fee of five thousand dollars($ 5,000.00) that was paid toward the

purchase option.

Sincerely,

Z. tA... e.. et'. t..---•`-lam

Sudhakar Madakasira, M. D.

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Restoring HealthRenewing Hope