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Corruption Prevails in Miami Beach

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First in Series on the epic battle of A Man Of Principle against the City of Miami Beach for his civil rights..

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MIAMI MIRROR – TRUE REFLECTIONS

Sadigo Court Apartment Hotel courtyard

Series: The Fire Sprinkler Case

CORRUPTION OPPORTUNITY PREVAILS IN MIAMI BEACH
Rod Eisenberg’s Civil Rights Case Summarily Dismissed
February 24, 2015
MIAMI MIRROR
by David Arthur Walters
South Beach—In a surprising and humiliating defeat for Rod Eisenberg, who sued the City of
Miami Beach in federal court for shutting down his historic Sadigo Court Apartment Hotel in
South Beach’s Collins Park area, throwing his guests onto to the street and arresting him in
alleged retaliation for his complaints about the corruption and negligence of city officials, U.S.
District Court Judge Cecilia M. Altonaga, in an Order dated 16 December 2014, summarily
dismissed his complaint on a technicality using what appears to be erroneous reasoning just as
his attorneys were preparing to go to trial in January after surviving the city’s previous motion
for summary dismissal. City attorneys had managed to get four of the seven counts dismissed in
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a previous motion for dismissal, and then moved in for the kill at the last moment with a
motion for final summary judgment fatal to the remaining three counts. Eisenberg, anticipating
a trial, might have been surprised by the sudden motion, but it is part of the summary motion
game ever popular in federal courts, where complaints may be hacked to death piece by piece
because the objective of the summary judgment procedure is to “pierce the pleadings and to
assess the proof in order to see whether there is a genuine need for trial.”
According to Rule 56 of the Federal Rules of Civil Procedure, “A party may move for summary
judgment, identifying each claim or defense — or the part of each claim or defense — on which
summary judgment is sought. The court shall grant summary judgment if the movant shows
that there is no genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law. The court should state on the record the reasons for granting or denying the
motion.”
Altonaga concluded that, as a matter of law, the “city cannot be held liable under section 1983
where the challenged fire safety enforcement decisions made by the City Fire Marshal were
subject to meaningful administrative review by County and State authorities. As this issue —
and the absence of evidence showing the existence of an unconstitutional City policy or custom
— are dispositive, the Court need not address the City’s remaining argument.”
I shall challenge that conclusion elsewhere. It is my opinion that that question of municipal
liability in this type of case is of far greater importance than the merits of Eisenberg’s case, that
it is of national import, and, if he had the wherewithal to do so, he should have appealed to the
highest court in the land.
According to Eisenberg’s complaint, the pretext for the city’s allegedly thuggish treatment of
him in regard to his ownership of vintage 1936 Sadigo was that it would have to be reclassified
from its state licensed use as a transient apartment lodging to a hotel because it had built a
cold-food preparation area, duly permitted by the building department, in the interior
courtyard, so that area would now have to be designated a “restaurant,” therefore the
apartment hotel was now a hotel.
Eisenberg and city attorneys apparently went for broke in the Sadigo case instead of arriving at
a compromise. Apparently the same city attorneys have been feuding with Eisenberg for many
years hence pursued the instant issue as a matter of “principle.” Eisenberg, for his part, was
reportedly deeply offended back in 1993 by what he called the “good old boy” network of
Miami Beach that destroyed his dream of operating with the Design Preservation League an Art
Deco Welcome Center and Gift Shop when his bid to lease the premises for that purpose from
the city was rejected because it was either a few hours late or preference was given to an
allegedly corruptly favored bidder. It appears from several incidents thereafter far that that
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incident put him permanently at odds with the ruling clique, and that he may have otherwise
become a good old boy himself by now since he was familiar if not intimate with some of the
current power elite during his schooldays.
For all we know, the Sadigo affair may be a just another instance of where action taken to
correct the usual ineptitude, negligence, and mismanagement of Miami Beach officials is
misinterpreted as retaliation. “They said I could do this, and now they are picking on me, and
that must be because I gave them a bad time. All they had to do was change the paper to read
hotel instead of apartment.”
The quibbling between whether or not the Sadigo Court Apartment Hotel should be classified
as an apartment or a hotel compatible with the zoning code is rather mind-boggling to
someone not familiar with the tangle of city processes that lawyers will be glad to untangle for
a fee. Eisenberg stated to the media in August 2011 that the real problem was not public safety,
it was just paperwork. After all, he said, the Sadigo had been serving tourists for 70 years. He
vowed to fight the city to the end, claiming that his was a case of big hotels versus family
operations. “This is definitely David versus Goliath,” he was quoted as saying.
The Sadigo Courtyard Apartment Hotel, purchased by Eisenberg in 1988, does indeed lie within
the Museum District within the Residential Multifamily Medium Intensity District (RM-2) for
which the main uses permitted by Sec. 142-212 of the Miami Beach Code of Ordinances are
"residential multifamily, medium intensity district are single family detached dwellings; town
homes; apartments; apartment-hotels; and hotels," the only exceptions being the Palm View
and West Avenue Corridors distant from the historic Museum District. (Emphasis added).
If the Sadigo had been operating as a transient apartment building since 1936 without any
questions asked, and then obtained a state transient apartment license in 2006, and, shortly
thereafter, a city certificate of occupancy and business tax license for that use thereafter, we
must ask how the occupancy was certified and business taxes paid prior to 2006, and what
triggered the filing in 2006, and why a certificate was granted, if that were the first one granted
for transient apartment use, without the installation of fire sprinklers, which we presume would
have been required at that time, sprinklers being required for transient uses including
multifamily apartment buildings and hotels, with nebulous “equivalency” exceptions for
“contributing” historic structures such as the Sadigo.
Now this series of essays is entitled “The Fire Sprinkler Case” because the fire sprinkler
requirement is the pretext for a dispute that may be a continuation of a longstanding feud.
Unsurprisingly, there have been a number of such disputes involving historic structures
throughout the nation with the advent of the fire sprinkler requirement. Common sense

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dictates that fire sprinklers equal fire sprinklers, that there is no equivalent to the ability of
automatic fire sprinkler systems to prevent injury and save lives.
The National Fire Protection Association sets the standards that many states including Florida
incorporate in their codes. In NFPA’S 2013 report on fire sprinklers, John Hall wrote that some
type of fire sprinkler system was present in only 6% of reported home structure fires in 20072011. When wet pipe sprinklers were present, the death rate per 1,000 fires was 82% lower
compared to home fires with no automatic extinguishing equipment at all. And 12% of deaths
were caused by smoke that impaired victims’ vision of escape routes, smoke that could have
been suppressed by sprinklers. Life saving smoke suppression would be Miami Beach Fire
Marshal Sonia Machen’s main argument for the necessity of installation of automatic sprinklers
at the Sadigo; she supposed that short-term guests would not know where to escape without
them.
However, fire safety is a cost/benefit issue for which certain “tradeoffs” are made. For example,
in 2007 Baker City, Oregon accepted the installation of two fire-resistant doors in the halls that
lead to two of the three movie auditoriums in the city’s historic Eltrym Theatre, That change,
together with the numbers of seats therein already reduced by half, was deemed “equivalent”
to fire sprinkler performance; meaning that the objective, the reduction of injuries and saving
of lives, would be equivalent to that obtained prior to the changes if sprinklers had been
installed.
Coincidentally, the owner of the Eltrym, Rudyard Coltman, who sued Baker City and its building
official and manager for shutting down his theatre, and Rod Eisenberg, the owner of South
Beach’s Sadigo, who sued the City of Miami Beach but none of its officials for shutting down his
transient apartment building, are trained lawyers, with Coltman practicing and Eisenberg not.
Coltman at the time was involved in the renovation of three movie theatres. Eisenberg’s
developments include three buildings besides the Sadigo. Coltman said at the time of the court
settlement, which served as his certificate of occupancy, that he intended to sue the city for
damages. Eisenberg may have erred in not suing the Miami Beach officials in their individual
capacity, as is often done in like cases, if they were acting unreasonably to deprive him of his
civil rights.
In the Baker City theatre case and others, the installation of fire sprinklers would have
destroyed some of the historic character of a building, not to mention cause the structure to be
closed permanently due to the extraordinary cost. So the determination of what constitutes a
lifesaving system “equivalent” to automatic fire sprinklers is left to the discretion of local
officials and experts, and the determination of equivalency is more of an art than a science.
Unfortunately, art leaves considerable latitude, like other discretionary issues, for
misunderstandings as to motives, and moral and criminal corruption.
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Section 633.022(2)(c) of the Florida statutes provides that “a local authority may, on a case-bycase basis, in order to meet special situations arising from historic, geographic, or unusual
conditions, with respect to a building or structure which is subject to the uniform firesafety
standards, authorize equivalent alternative standards for such building or structure; however,
the alternative requirements shall not result in a level of protection to life, safety, or property
less stringent than the applicable uniform firesafety standards. All such local authorities shall
enforce, within their firesafety jurisdiction, the uniform firesafety standards for those buildings
specified in paragraph (1)(b) [includes “transient public lodging”] and the minimum firesafety
standards adopted pursuant to s. 394.879 [mental health institutions]. Emphases added.
Section 509.215 provides that public lodging establishments of three or more stories or a height
75 feet or more, and “for which the construction contract has been let after September 30,
1983,” must have fire sprinklers. However, a “special exception” may be made for contributing
historic structures, which Sadigo is, providing they meet the intent of NFPA standards as
interpreted by state officials.
Florida’s standard for historic structures is expressed in NFPA 914, which takes us back to an
equivalency that Eisenberg naturally construes in his favor. What bearing a formal change of
use from residential apartment to transient or short-term rentals at the ancient Sadigo on “for
which the construction contract has been let” is problematic especially if renovation coincided
with the formal change.
There is obviously plenty of room for arguments on both sides here, not only on law but on the
facts, arguments that should have been made before a jury instead of being dismissed
summarily by a local federal judge intimate with the local power structure. Clearly local officials
had discretion to set policy for the city as to equivalency and set it they did, and it was unlikely
that county officials would dispute their artful definition of the term, wherefore Judge Altonaga
was clearly in error in dismissing the case on the basis that the city was not the policy maker.
Eisenberg applied for a certificate of occupancy for use as a hotel after the city defined his coldfood preparation room as a “restaurant,” a definition that seems ridiculous since it was not
open to the public as a restaurant. His application was denied because now, insisted city
officials, it would need the fire protection system applicable to “brand new hotel structures.”
City attorneys argued in court that a universal law mandated fire sprinklers in his case.
Eisenberg maintained that the city attorneys knew better, that there was no such universal law,
that his kind of historic structure was actually excluded from the uniform rules by state law. In
other words, they lied in court, where, it is said, more lies are told than anywhere else in the
world.

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According to the findings in the related state case (11-22415 CA 01) previously brought in the
Eleventh Judicial Circuit Court for Miami Dade County by Eisenberg against his former
attorneys, Jeffrey Bercow and Bercow, Radell & Fernandez, for failing persuade the city to allow
him to operate a transient lodging without fire sprinklers, the sprinkler requirement is the same
for transient apartments and hotels because it is assumed, or so said Fire Marshall Sonia
Machen, that short-term tenants i.e. tourists are less familiar with the premises they occupy
hence would be placed in greater danger than long-term tenants because they would not be
aware of escape routes. Circuit Court Judge Daryl E. Trawick dismissed the complaint with
prejudice on June 2, 2014, ruling that it was a sham because the facts clearly demonstrated that
the law firm was not responsible for Eisenberg’s losses.
Judge Trawick recounted in the dismissal document that ‘Mr. Eisenberg subsequently sought a
temporary injunction against the City in this, the Eleventh Judicial Circuit Court, in Eisenberg
Development Corp. v. The City of Miami Beach, case no. 11-20234 CA 15. On January 5-6, 2012,
Judge John Thornton heard two days of testimony, including testimony from Mr. Eisenberg and
his experts, as well as various engineers, and the City Fire Marshal.
“Judge Thornton took note of the testimony of Richard Lorberg, the City’s Planning Director,
who specifically conceded that the Sadigo was at least zoned to operate on a transient basis.
The court nevertheless concluded – consistent with testimony at the hearing – that the Fire
Marshal had jurisdiction to interpret the Fire Prevention Code and to otherwise insist upon the
presentation of an acceptable “equivalency report,” in order to protect the public safety, health
and welfare. Ultimately, Judge Thornton concluded that the Sadigo had failed to properly
challenge the findings of the Fire Chief regarding the need for a sprinkler system and that the
“life safety considerations of protecting the innocent public in a non-code compliant building"
outweighed any prospective loss of profit of good will to Sadigo.’
The jurisdiction of the Fire Marshal would be a crucial issue in the federal case as to the identity
of the policymaker in respect to the interpretation of the fire code; the federal judge held that
the city was not the policymaker because the fire marshal’s decisions could be appealed to an
authority higher than her employer, the city, something that Eisenberg had done to no avail,
yet still had not exhausted his options including further appeals.
The federal complaint alleges that Eisenberg continued, from 2006 to 2011, to rent his transient
apartments out on a short-term basis as before despite being harassed with violation notices
and cease-and-desist orders. The building official insisted that a sprinkler system be installed,
refusing to accept an engineer’s equivalency report.
Eisenberg addressed the city commission in 2011, arguing against the hotel reclassification.
“The Mayor, City Commissioners, City Manager, and City Attorney were indifferent and the City
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Fire Chief took offense to Plaintiffs’ claims of unfair treatment,” reads one of the plaintiff’s
court filings, drafted by Smolker, Bartlett, Schlossler, Loeb and Hines, a Tampa law firm.
Indeed, the city commission’s after-action report for Jan. 19, 2011, states that “Rod Eisenberg
explained that he has been trying to do a change of occupancy from R2 to R1 for three years on
an apartment building which is an existing historic structure and explained the barriers he
encountered throughout this period of time and his efforts to resolve the issue. Eric Yuhr, Fire
Chief, responding to Mr. Eisenberg allegations and for the record, stated that to have someone
stand before this Commission and characterize the ethics of the Fire Marshal is offensive and
out of line. This Fire Marshal works day and night in trying to uphold the code. He added that
he resents the implication that the Fire Marshal engages in harassment or in a retaliatory
manner and added that it is unacceptable.”
The state circuit court dismissal discloses that Eisenberg hired an engineer, then an architect,
and then another engineer, recommended by his lawyer, to come up with a design that did not
include fire sprinklers. They all desisted, one by one, at which point Eisenberg fired the last one
along with his lawyer, whom he sued, calling the professionals “shills” i.e. decoys for the city,
con men posing as his experts. His lawyer Bercow alleged that he advised Eisenberg that the
special exceptions to the fire code for historical structures might be an avenue he could pursue,
but he should not count on the results.
Eisenberg’s federal complaint alleged that “Plaintiffs believe the City Fire Marshall [Sonia
Machen] told the Sadigo’s mortgagee the Sadigo was illegally operating as a hotel. On January
21, 2011, the Sadigo’s mortgagee advised it would not renew its loan after previously
encouraging Plaintiffs to renew the Sadigo’s loan. Plaintiffs were left with no choice but to
refinance the Sadigo at a higher interest rate — an enormous additional cost.”
“In April 2011, the City informed the Sadigo’s longstanding client, the Art Basel Foundation, the
Sadigo was illegally operating as a hotel. The Foundation then severed its business relationship
with Plaintiffs. In June 2011, the City sent undercover police officers to the Sadigo to verify the
Sadigo was renting to transient guests. After observing transient rental activity, the City’s police
officers shut down the Sadigo for noncompliance with City fire codes, evicting the Sadigo’s
tenants and guests. This shutdown caused the Sadigo’s largest client, responsible for over
$100,000 in annual revenue, to sever its business relationship with Plaintiffs.
“In December 2011, fifteen police offers, ten code enforcement officers, including [Jose]
Alberto, and five fire officials forcibly shut down the Sadigo for a second time for violations of
City fire codes. The shut down occurred while the Sadigo was hosting the ‘Pool Art Fair’ during
the renowned Art Basel Miami Beach art show, forcing guests to vacate the premises in one
hour. Alberto [Jose Alberto, later convicted and imprisoned for corruption elsewhere] offered
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to solve Eisenberg’s problems ‘by using ‘his people,’ insinuating a bribe would be due from
Eisenberg. When Eisenberg refused by stating he already had legal counsel working on it,
Alberto stated . . . Eisenberg would not get far using legal means. Eisenberg was then arrested.
In April 2012, Alberto and other code compliance officers and fire department inspectors were
arrested for bribes they accepted in June 2011. Since these arrests, the Sadigo has not received
any further code compliance notices or violations.”
America’s beloved mobster Al Capone, who kept a gambling hideaway at the Clay Hotel on
Espanola Way, where the current mayor’s friend and partner Scott Robins has run an transient
apartment hotel without a certificate of use and business tax receipt license for several years,
would probably call city officials pansies for taking so long to close down the Sadigo and for not
making shark bait of its owner for exposing the corrupt “good old boy network” to investigators
and the media.
According to Eisenberg’s suit, he had discovered that the city’s bid selection process was
corrupt in 1993 after bidding to rent space at the old city hall building. That motivated him to
take city officials to task on other matters.
“He learned the winning bidder was receiving free rent in the Old City Hall during the bid
challenge. He also discovered a City commissioner and his son had received what amounted to
an illegal brokerage commission on a $10 million real estate transaction. He subsequently
disclosed these instances of City corruption to the media. As a result of his disclosures, a
scandal ensued which ultimately led to the City manager resigning, and the City attorney being
forced out, The Florida Department of Business and Professional Licensing subsequently
brought an eleven-count administrative complaint against the City commissioner’s son, the
son’s company, and the winning bidder agreed to pay the fines.
“In 1995, Eisenberg challenged the City and Miami-Dade County’s creation of a redevelopment
area related to the Miami Beach Convention Center…. Between 2004 and 2009, Plaintiffs and
others in the neighborhood voiced many complaints about the health and safety risks and Code
compliance violations of an abandoned hotel in the neighborhood. The City investigated some
of these complaints but did not resolve the problems with the building….
“Between 2006 and 2012, multiple City officials were investigated and prosecuted for
corruption. In 2006, a City electrical inspector was arrested for soliciting bribes in 2008, a City
fire protection analyst was fired after reporting suspicions of kickbacks. Also in 2008, a City
planner, examiner, and inspector were all caught accepting bribes. In 2012, City procurement
director, Gus Lopez, was charged with sixty-three felony counts, including racketeering, bidtampering, and illegal compensation, And also in 2012, seven City Code compliance and fire
department inspectors, including the City’s lead code compliance officer, Jose Alberto
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(“Alberto”), were arrested for extortion and accepting bribes in June 2011 to bypass city code
enforcement inspections and fines.”
As far as old timers are concerned, all that is government business as usual on Miami Beach.
Official negligence is commonplace. Many ordinances, obscure to most residents not doing
business on the beach, are ignored unless someone complains about specific violations, often
for purposes of retaliation or simply to make trouble for someone they do not like. Selective
enforcement is also a feature of widespread moral and criminal corruption, where the
labyrinthine codes are mainly applied to outsiders or unsupportive people. The laws themselves
may not be discriminatory, yet they are applied in discriminatory fashion if not randomly to
create the appearance that officials are doing their duty here and there from time to time.
Many informed people like it that way or go along with it to get along. That is, until they are
personally offended, as was unlucky Rod Eisenberg when he wanted to rent space at city hall
and it was corruptly let out to someone else. Instead of waiting for the next draw of the cards,
he shot his mouth off to media, filed failed lawsuits, and then he refused to pay off the right
people when officials retaliated against him. Well, the overwhelming majority of people who
respond to polls in paradise believe the city government is doing a great job. Lawsuits against
the city to be defended at taxpayer expense are not appreciated. Eisenberg is damned fool to
those who would in Rome do as Romans do. And he is a quixotic hero for those who actually
believe that every individual should or can ever be equal under the laws of human nature.
Attorneys must tell a compelling tale if they are to win their cases. The subheadings of the
original complaint filed by Eisenberg’s attorneys outline his story of woe: The Parties,
Jurisdiction, and Venue; The Sadigo Court Property; The City's Culture of Corruption Unjustly
Ensnares Mr. Eisenberg; The City's Culture of Corruption Continues; The City Arbitrarily and
Maliciously Deems the Historic Sadigo Court a Hotel to Prevent the Plaintiffs from Renting Its
Apartments to Transient Guests; The City Arbitrarily and Maliciously Deems the Historic Sadigo
Court a New Hotel to Prevent Plaintiffs from Renting Its Apartments to Transient Guests By
Imposing Unreasonable and Unnecessary Fire Protection Renovation Requirements; The City's
Culture of Corruption Unjustly Ensnares Mr. Eisenberg Again; The City's Application of Its
Unwritten Customs, Policies, and Practices; The Consequences of the City's Arbitrary and
Malevolent Actions.
The remedies provided by law are then claimed, count by count. Eisenberg wanted relief and
damages under federal and state constitutions for the violation of his civil right to equal
protection of law, freedom of speech, and due process.
Furthermore, he wanted the court to declare that the city’s use of fire regulations in respect to
the types of occupation and zoning of historic hotels violates state law and is therefore invalid,
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and to provide attorneys fees and whatever other relief is available. And he asked the court to
clear up the confusion as to the difference between a transient apartment and a hotel, and
declare what local ordinances properly comply with state and federal law so that all interested
parties may know their rights and duties in that regard.
Finally, the plaintiff asked that the case be tried by a jury. If the facts as given in the complaint
alone were true, we would draw inferences based on our disaffection with government hence
most likely grant him the relief and remedies he desired. But we are not judges, and the law in
the hands of cavilers is something other than what it seems to say to laymen. After looking at
the facts offered, the judge dismissed the case, supposedly as a matter of law, yet also
substituting herself as a jury considering the facts by citing Channa Imps., Inc. v. Hybur, Ltd.
(2008) as a legal standard: “A factual dispute is genuine if the evidence is such that a reasonable
jury could return a verdict for the nonmoving party.” So there will be no jury of the people to
hear all the evidence and hold the city accountable if necessary. Wherefore, with this bestowal
of immunity on the municipality, the opportunity for corruption prevails.
Now that he has had his federal case dismissed, we wonder if Eisenberg will sue his new set of
lawyers for malpractice, and try to get the case reopened by alleging new facts or fraud on the
court.
And now the city may claim federal suit was just as much a sham as his state suit. The city has
asked the court for $30,000 in court costs and wants attorney fees of $800,000 to boot, thus
putting pressure on Eisenberg to blame his attorneys again. And so on ad infinitum. We
estimate Eisenberg’s own legal fees at $600,000 all told. His total damages including legal costs
and fees, closures and refinancing, from fighting city hall may well exceed $4,000,000. If he
were not a man of principle, he would rue the day that he chose not to install sprinklers at a
cost of $100,000. As a man of principle, he may wish that he had not folded his cards instead of
mounting an appeal on the issue dismissed, that municipalities are not liable in his type of
situation; a win there would at least redeem him with a national merit badge.

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