Petitioner brings this Article 78 proceeding to challenge the denial by [*2]respondents, New York City Department of Buildings (DOB) and New York City Department of Citywide Administrative Services (DCAS), of a Master Fire Suppression Piping Contractor's License (MFSPC License) that petitioner first applied for on December 7, 2007. Petitioner seeks an order (Motion Seq. No. 001):

(1) Reversing, annulling and setting aside respondents' March 19, 2013 denial of petitioner's December 7, 2007 application for a New York City MFSPC License, on the basis that it was arbitrary and capricious, and in violation of the New York State Correction Law.

(2) Remanding the matter back to respondents with a direction that respondents issue petitioner the New York City MFSPC License sought.

Petitioner also brings a motion against respondents for an order pursuant to 22 NYCRR § 130-1.1 for sanctions (Motion Seq. No. 002) alleging that respondents made false material factual statements to this Court. This decision addresses the petition and the motion.

On September 20, 2000, in Queens County Criminal Court, petitioner pled guilty to a single criminal charge of offering unlawful gratuities, a class A misdemeanor. (Penal Law § 200.30). Petitioner was fined $1000 and received a conditional discharge. (See Petition Ex B.) Petitioner also received a Certificate of Relief from Disabilities (the Certificate) from the Queens County Criminal Court. (See Petition Ex. C.)

In September 2003, petitioner submitted an application to obtain a New York City Master Plumber's License from DOB. DOB denied petitioner's application, on the ground of "poor moral character" in light of his 2000 misdemeanor conviction. (Petition ¶ 18.)

Petitioner challenged DOB's denial via an Article 78 proceeding, Gorelik v Dept. of Citywide Admin. Servs., index no. 108028/04. This Court denied the petition and dismissed the proceeding. (See Petition Ex. D.)

On December 7, 2007, petitioner first submitted the application for the New York City MFSPC License. Petitioner passed the examination for the MFSPC License, and DOB requested that petitioner submit more information in support of his application. (See Answer Ex. E.) Petitioner submitted all the required information including several DOB forms in which he disclosed his 2000 misdemeanor conviction as required by law. (See Petition Ex. E.) [*3]

By letter dated September 10, 2009, Harold Block, the CEO of Pace Plumbing Corp., one of the employers petitioner listed on his MFSPC License application, informed DOB that petitioner had worked there and attached a press release discussing the arrest of petitioner for "making a total of $2250 in cash payoffs to a [Department of Investigation] undercover agent. The payoffs were allegedly made to avoid the issuance of two Notices of Violation (NOVs) and eight Inspector Warning Notices (IWNs) for improperly installed water meters, under the City's Reimbursable Water Metering Program, at a housing complex in Long Island City." (Answer Ex. H.)

By letter dated September 29, 2010, DOB informed petitioner that it was denying his application for the MFSPC License. (Petition Ex. F.) The letter stated in pertinent part,

"Pursuant to section 26-133 of the NYC Administrative Code an applicant shall be of good moral character, and shall meet additional qualifications that may be prescribed for the particular license or certificate of competence.' Based on the Department's review, you have not satisfied the requirement of good moral character.

On September 20, 2000, you pled guilty to NYS Criminal Procedure Law Section 200.30 Giving Unlawful Gratuities. This conviction stemmed from an incident in which you gave a Department of Investigation undercover investigator $2000 in cash to avoid being issued Inspector Warning Notices for improperly installing eight water meters in a housing complex.

Your conviction for giving an unlawful gratuity bears a direct relationship to your fitness and ability to perform the duties and responsibilities of a Master Fire Suppression Piping Contractor. Since, as a licensee, you would be authorized to install systems engineered to protect individuals and the public from injury due to fire, your willingness to bribe an inspector so as to hide your violation of the technical provisions concerning water meter installation, calls into question whether you would risk the safety of the public in the future for your own convenience."

By letter dated November 9, 2010, petitioner submitted a request for reconsideration enclosing twelve testimonials from individuals who attested to petitioner's good moral character and rehabilitation. (See Petition Ex. G.) By [*4]letter dated June 13, 2011, DOB requested that petitioner submit additional information relating to his MFSPC License application, specifically "a detailed explanation, in writing, of the circumstances surrounding his arrest and subsequent guilty plea." (Petition Ex. H.) On July 8, 2011, petitioner submitted an affidavit explaining the circumstances of his arrest and supporting documents, including the Certificate. (See Petition Ex. I.)

Prior to respondents' reconsideration of DOB's denial of petitioner's application, petitioner sought from DOB, via a Freedom of Information Law (FOIL) request, copies of all approved license applications for which the applicants in question had a criminal history (FOIL Request No. 1). According to the petition, the purpose of the request was to show that other applicants had been approved for the MFSPC License, and for similar licenses, despite having engaged in criminal acts, and that other applicants were approved despite their criminal conduct being closer in time to their applications than petitioner. (Petition ¶ 32.) When DOB did not respond to petitioner's FOIL request No. 1 and petitioner purportedly exhausted his administrative remedies, he brought an Article 78 proceeding to compel DOB's compliance, Gorelik v New York City Dept. of Buildings, index no. 110038/11.

By letter dated September 19, 2011, DOB denied reconsideration of its denial of petitioner's MFSPC License application for "fail[ing] to meet the Department's good moral character requirement for licensure under the [Administrative Code]." (Petition Ex. J.)

By letter dated October 27, 2011, while the Article 78 proceeding regarding FOIL Request No. 1 was still pending, petitioner submitted another FOIL request with DOB (Foil Request No. 2). For this request, petitioner demanded copies of approximately 25 stipulations resolving disciplinary actions brought by DOB against certain licensees for corruption-related activity (the Stipulations). According to the petition, the purpose of this request was to show that DOB was purportedly treating petitioner differently than other similarly situated individuals, and that others who had engaged in corruption-related activity had been allowed to keep their licenses. (Petition ¶ 36.) By letter dated January 3, 2012, petitioner made a formal appeal to the DOB Commissioner regarding DOB's failure to respond to FOIL Request No. 2. (Petition ¶ 38.)

On January 18, 2012, petitioner brought an Article 78 proceeding, Gorelik v New York City Dept. of Buildings, index no. 100603/12, to annul DOB's September 19, 2011 denial of his application as arbitrary and capricious. (See Petition Ex. K.) In that proceeding, petitioner also requested the court to compel [*5]DOB to respond to FOIL Request No. 2. (See Petition Ex. K.) That same day, the court (Mills, J.) dismissed the Article 78 proceeding (index no. 110038/11) to compel DOB to respond to FOIL Request No. 1. (See Petition Ex. L.)

By Verified Answer dated February 15, 2012, DOB claimed that the issue to compel DOB to respond to FOIL Request No. 2 was not properly before the court, because DOB had not yet actually denied FOIL Request No. 2 and was still working on its response. (See Petition Ex. K.) On May 7, 2012, the court (Wright, J.) settled the section of the Article 78 proceeding regarding FOIL Request No. 2 by an order directing the parties to join on a conference call with the court on June 4, 2012 at which time DOB would report on its progress in fulfilling the FOIL request. (See Petition Ex. M.)

The conference call was adjourned to and held on June 21, 2012. (Petition

¶ 54.) On July 6, 2012, DOB produced 24 of the 25 Stipulations from FOIL Request No. 2 and explained that one of the Stipulations could not be located. (Petition Ex. N.)

On September 27, 2012, the court (Wright, J.) granted petitioner's Article 78 petition to annul DOB's September 19, 2011 denial - index no. 100603/12 - to the following extent:

"Since it was admitted at argument that licensees who had similar legal transgressions had been allowed to keep their licenses, I am at a loss to see the distinction between these people, and the Petitioner here. The distinction asserted by the Respondents is really one with little or no difference. Since there is a history of the Respondents permitting former convicts to obtain licenses, this petition is granted to the extent of remanding the matter for further consideration, in view of the now confirmed history of allowing ex-convicts to obtain licenses."

On March 12, 2013, petitioner moved for an order of contempt against DOB for its failure to comply with the order to reconsider petitioner's application. (Petition ¶ 67.) By letter dated March 19, 2013, DOB again denied petitioner's application for the MFSPC License. (Answer Ex. O.) The letter stated in pertinent part, "[a]lthough Mr. Gorelik met the practical experience requirement, he fails to meet the Department's good moral character requirement for licensure under the [Administrative Code]." (Id. at 1.) The letter also addressed the Stipulations from FOIL Request No. 2, stating,

"Mr. Gorelik alleged that he was similarly situated to twenty-five licensees [*6]whom, by stipulation, were disciplined by the Department and provided copies of these stipulations to the court. . . . However the distinctions between Mr. Gorelik['s] license application and the named licensees' disciplinary actions demonstrate that these licensees were appropriately treated differently.

The stipulations name licensees who were disciplined by the Department from 1998 through 2006, none of whom were prosecuted or convicted of any crime. In the 1990s, Department Inspectors whom were arrested on corruption charges made allegations of bribe offering against several licensees. Based on these allegations, the Department filed disciplinary charges against fourteen Private Agency Elevator Inspectors and Directors for offering a benefit to Department inspectors. Similarly, the Department filed disciplinary charges against three Master Plumber licensees for giving unlawful gratuities to Department inspectors. A Master Sign Hanger licensee was also disciplined for permitting the use of his license by another person. These disciplinary actions were based on the licensees' alleged violation of the Administrative Code, not criminal convictions. Absent an admission of criminal liability and without pleading guilty to the alleged conduct, the named licensees signed stipulations to pay fines and/or be placed on probation to resolve their disciplinary cases. Although these disciplinary cases also concern bribery of City officials, the circumstances leading to these licensee stipulations are quite distinct from the Department's consideration of Mr. Gorelik's criminal conviction, after pleading guilty, as part of the assessment of his moral character.

Additionally, Mr. Gorelik, unlike the licensees named in each stipulation, is an applicant for licensure. As an applicant, if the Department determines that Mr. Gorelik lacks good moral character, there is no other option than to deny licensure. In contrast, the Department has discretion to use various methods when disciplining active licensees, including the imposition of fines, probation, suspension, as well as commencing an action for license revocation."

On April 3, the court (Wright, J.) denied petitioner's motion for contempt deeming it moot in light of DOB's March 19, 2013 denial of petitioner's MFSPC [*7]License application. (See Petition Ex. S.) On April 26, 2013, petitioner moved for leave to reargue the denial of his motion for contempt, maintaining that the court had ordered DOB not to issue just any determination, but rather to specifically review petitioner's application in light of the Stipulations from FOIL Request No. 2. (Petition ¶ 70.) On May 15, 2013, the court denied petitioner's motion for leave to reargue. (See Petition Ex. T.)

Thereafter, on July 17, 2013, petitioner commenced this Article 78 proceeding to annul and overturn DOB's March 19, 2013 denial of his application for the MFSPC License. On September 25, 2013petitioner brought a motion against respondents for an order pursuant to 22 NYCRR § 130-1.1 for sanctions for alleged continued misrepresentations of material facts to this Court. Petitioner alleges that respondents have repeatedly stated to this Court, as a basis for denying petitioner's application for the MFSPC License, that petitioner committed the crime of bribery and that he did so on multiple occasions.

Respondents argue that the petition should be dismissed because

respondents' determination to deny petitioner's application for the MFSPC License was not arbitrary and capricious and was supported by the administrative record, and that the proceeding fails to state a cause of action as DOB cannot be compelled to perform a discretionary act. Respondents argue that the motion for sanctions should be dismissed because the motion is baseless and sanctions are not warranted.

The standard for judicial review of an agency decision denying the privilege of a license is whether the decision is arbitrary and capricious. (See Matter of Arrocha v Board of Educ. of City of NY, 93 NY2d 361 [1999] [finding that it was not arbitrary or capricious for the agency to deny a teaching license based on the conclusion that the applicant posed a risk to the safety of the student population and school employees, where the applicant was convicted of sale of cocaine nine years before and was sentenced to a prison term of 2-6 years].)

Pursuant to Administrative Code § 26-133, "[a]ll applicants for licenses shall be at least eighteen years of age, shall be able to read and write the English language, shall be of good moral character and shall meet the qualifications prescribed for the particular license, as hereinafter provided."

Correction Law § 752, which is entitled "Unfair discrimination against persons previously convicted of one or more criminal offenses prohibited" provides:

"No application for any license or employment, and no employment [*8]or license held by an individual, to which the provisions of this article are applicable, shall be denied or acted upon adversely by reason of the individual's having been previously convicted of one or more criminal offenses, or by reason of a finding of lack of "good moral character" when such finding is based upon the fact that the individual has previously been convicted of one or more criminal offenses, unless:

(1) there is a direct relationship between one or more of the previous criminal offenses and the specific license or employment sought or held by the individual; or

(2) the issuance or continuation of the license or the granting or continuation of the employment would involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public."

Under Correction Law § 753, the following specific factors must be considered in making the determination under Correction Law § 752:

"(a) The public policy of this state, as expressed in this act, to encourage the licensure and employment of persons previously convicted of one or more criminal offenses.

(b) The specific duties and responsibilities necessarily related to the license or employment sought or held by the person.

(c) The bearing, if any, the criminal offense or offenses for which the person was previously convicted will have on his fitness or ability to perform one or more such duties or responsibilities.

(d) The time which has elapsed since the occurrence of the criminal offense or offenses.

(e) The age of the person at the time of occurrence of the criminal offense or offenses.

(f) The seriousness of the offense or offenses.

(g) Any information produced by the person, or produced on his behalf, in regard to his rehabilitation and good conduct.

(h) The legitimate interest of the public agency or private employer in protecting property, and the safety and welfare of specific individuals or the general public."

In making this determination it is important for the agency to carefully analyze all the factors and to consider that:

"The Legislature has determined that, as a general rule, it is unlawful for a public or private employer to deny an application for a license or employment on the ground that the applicant was previously convicted of a crime. This general prohibition advances the rehabilitation and reintegration goals of the Penal Law. Furthermore, barring discrimination against those who have paid their debt to society and facilitating their efforts to obtain gainful employment benefits the community as a whole."

Here, respondents' determination to deny petitioner's application for the MFSPC License for lack of "good moral character" was not arbitrary and capricious. Specifically, DOB considered the specific duties and responsibilities related to the MFSPC License and found in pertinent part as follows:

"A [MFSPC] License authorizes the holder to design, install, maintain and modify fire suppression systems. It also allows an individual to control a business which conducts these services in New York City. The licensee is required to file permits for fire suppression work and certify that such work is performed in accordance with the Code and must otherwise meet the New York City Fire Department fire suppression testing and certification requirements."

DOB also found that the issuance of the MFSPC License would involve an unreasonable risk to property or to the safety of the welfare of the general public, explaining, "[DOB] has a paramount interest in deterring licensees from engaging in any bribery, corruption or manipulative tactics while performing work authorized under the license," especially where the licensee has the "authority to install complex fire suppression systems intended to safeguard the public in the invent of a fire." (Answer Ex. O at 3.) Therefore, DOB's determination was not arbitrary and capricious.

An applicant who has a certificate of relief from disabilities or a certificate of good conduct is entitled to a presumption of rehabilitation in regard to the specified offense. (See Correction Law § 735 [2].) Although petitioner submitted a Certificate, his submission does not bar DOB from considering petitioner's conviction. Although a Certificate creates a presumption of rehabilitation, it does not "in any way prevent any judicial, administrative, licensing or other body, board or authority from relying upon the conviction specified therein as a basis for the exercise of its discretionary power to suspend, revoke, refuse to issue or refuse to renew any license, permit or other authority or privilege." (Correction Law § 701 [3] see also Matter of Inglese v LiMandri, 89 AD3d 604, 605 [1st Dept 2011] [upholding DOB's denial of a hoist machine license based upon petitioner's guilty plea of conspiracy to commit extortion, finding that "conviction of a crime directly related to the use of the subject license demonstrates poor moral character that adversely reflects on [petitioner's] fitness to hold a licensed position in the construction industry"].)

Matter of Robles v Limandri (107 AD3d 592 [1st Dept 2013]) is not applicable to the instant case. In Robles, the petitioner, a custodial engineer employed by the Department of Education (DOE) until May 2006, obtained his stationary engineer license in January 1995. (Petitioner Supp. Memo., Ex. 2 [Robles Petition], ¶ 19.) The petitioner was charged with theft or bribery concerning programs using federal funds, in that between March 2003 and October 2004, the petitioner purportedly "embezzled, stole, obtained by fraud and misapplied property valued at $5000 or more that was owned by and under the [*11]care, custody, and control of the DOE, which agency received benefits in excess of $10,000 each of the years 2003 and 2004 under a federal program a grant, subsidy and other form of federal assistance, in violation of 18 U.S.C. § 666 (a)(1)(A)." (Id. ¶ 22.) On September 28, 2005, the petitioner pled guilty to a single count in the Eastern District of New York. Subsequent to the petitioner's conviction, DOB continued to grant the petitioner's renewal applications for a stationary engineer license, on an annual basis. (Id. ¶¶ 46-53.)In each renewal application, the petitioner disclosed his 2005 conviction as required by law. (Id.) In January 2011, DOB denied the petitioner's renewal application on the grounds of "poor moral character" based on the petitioner's 2005 conviction, thereby changing its prior position.^[FN1] (Id. ¶ 54.) The court in Robles held that "respondents arbitrarily concluded that petitioner's federal conviction of unlawfully accepting property of another bore a direct relationship to the duties and responsibilities attendant to a stationary engineer, the license for which he sought renewal after having his license renewed several times" (Roblesi, 107 AD3d at 592 [emphasis added].)

In the instant case, unlike in Robles, petitioner first applied for the MFSPC License on December 7, 2007. This was petitioner's first and only application for a MFSPC License, which respondents denied on the basis of lack of good moral character. Petitioner never worked in the industry with the MFSPC license. DOB has not changed its prior position as in Robles because there was no prior position to change. Moreover, because DOB has determined that petitioner lacks good moral character, there is no other option than to deny licensure, whereas DOB has discretion to use various methods when disciplining active licensees seeking to renew their licenses including "the imposition of fines, probation, suspension, as well as commencing an action for license revocation." (Answer Ex. O at 2.)

The most recent case on this issue, Matter of Bovich v LiMandri, (2014 WL 1386610, 2014 NY App Div LEXIS 2423 [1st Dept April 10, 2014]), is similarly distinguishable. In Bovich, the Appellate Division, First Department found that

"[r]espondents arbitrarily concluded that petitioner's prior federal conviction for theft of funds bore a direct relationship to the duties and responsibilities attendant to a stationary engineer, the license for which he sought renewal after having his license renewed 25 consecutive times." (Id. [emphasis added].) Like in Robles [*12]and unlike in the instant case, it was viewed as arbitrary when respondents changed their position on renewing the license application after the petitioner in Bovich had already disclosed his conviction numerous times.

Petitioner's reliance on Matter of Dellaporte v New York City Dept. of Bldgs. (106 AD3d 446 [1st Dept 2013])is misplaced. In Dellaporte, the Appellate Division First Department found that "[DOB] arbitrarily concluded that petitioner's federal conviction for theft of funds bore a direct relationship to the duties and responsibilities attendant to a stationary engineer, the license for which he sought renewal after having his license renewed 15 consecutive times." (Id. at 447 [emphasis added].) Similar to Robles, and unlike the instant case, it was viewed as arbitrary when DOB changed its position on renewing the license application after the petitioner in Dellaporte had already disclosed his conviction several times.

Moreover, although petitioner argues that, under Dellaporte, respondents are required to provide independent evidence to rebut the presumption accompanying the Certificate, the Court of Appeals has held that a Certificate does not automatically shift the burden to the agency to submit independent evidence. (See Matter of Bonacorsa v Van Lindt, 71 NY2d 605, 614 [1988].) Rather, rehabilitation is one of eight factors to consider in a Correction Law § 753 analysis. Here, DOB weighed all eight factors set forth in Correction Law § 753 in reaching its determination. The weight given to each of these factors is "beyond the power of judicial review"; thus courts cannot engage in a "re-weighing" of the Correction Law § 753 factors. (Arrocha, 93 NY2d at 367.) Therefore, respondents' determination to deny petitioner's MFSPC License application was not arbitrary and capricious. Respondents had a rational basis, which they articulated.

As to the motion for sanctions, petitioner argues that sanctions are warranted because respondents have repeatedly stated to this Court as a basis for denial of petitioner's MFSPC License that petitioner committed the crime of bribery on multiple occasions, which petitioner contends are material factual statements that are false, because petitioner's criminal record is limited to one conviction of a single count of offering unlawful gratuities pursuant to New York Penal Law § 200.30, a class A misdemeanor. Petitioner further argues that the allegations are based on a press release, and thus, the allegations are hearsay. Respondents argue, and the Court agrees, that respondents never stated that petitioner "committed multiple felonies," and the words "bribe" or "bribery" were used in the Verified Answer to describe the conduct underlying the conviction for [*13]offering unlawful gratuities, not to state that the petitioner committed a felony or multiple felonies of Bribery under New York Penal Law. In addition, the press release, which discusses the underlying conduct, was made part of the administrative record because it was provided to DOB by petitioner's former employer, Harold Block, and the press release was only one of the many documents in the administrative record DOB considered in reaching its final determination. Therefore, the motion for sanctions is denied.

In light of the Court's finding that respondents did not act arbitrarily and capriciously, the Court need not reach respondents' remaining contentions.

CONCLUSION

Accordingly, it is hereby

ADJUDGED that the petition is denied and the proceeding is dismissed (Motion Seq. No. 001); and it is further

ORDERED that petitioner's motion for sanctions (Motion Seq. No. 002) is

denied.

Dated: May 1, 2014ENTER:

New York, New York

/s/

J.S.C.