Pizza franchise threatens suit over fast food law
June 9, 2008 · Updated 2:55 PM
"Allow a Papa Murphy's pizza franchise on Bainbridge Island, or risk seeing the city's fast-food ordinance overturned in court.That's the challenge from restaurateur Mike Cooper of Sequim, and his attorney. Do the city a favor and interpret the ordinance in a way that permits our operation, attorney Peter Eglick told a city hearing examiner Monday, because I don't think this ordinance will last a day in court.Cooper said his plan to open a Papa Murphy's U-bake pizza outlet in the Village shopping center was approved in December of 1999. But after a complaint from another local pizzeria, a sizeable investment by Cooper, and an executive session of the city council, city Planning Director Stephanie Warren reversed her decision, a sequence of events that has prompted charges of favoritism and closed-door dealings.Cooper decried the city's actions before city hearing examiner Robin Baker in two days of testimony Friday and Monday. The Vancouver-based Papa Murphy's chain calls its product take and bake pizzas. It assembles pizzas and breadsticks at its outlets, and sells that food uncooked. Cooper, who owns Papa Murphy's franchises in Sequim and Port Angeles, leased space between Books, Bagels and Beans and Radio Shack in the Village, in a space formerly occupied by a beauty products store.He maintains that Papa Murphy's is a specialty grocery store, and is therefore not governed by the city ordinance concerning formula take-out food restaurants.We don't have an oven or any other source of heat, Cooper said Monday, so how can we be a restaurant? We're two doors away from General Nutrition Center. It's a franchise, and it sells food. Why am I different?While the city does not prohibit formula fast-food businesses under the zoning code, it does restrict them to the area on High School Road east of Highway 305, where McDonald's is located.If Papa Murphy's is classified as a formula fast-food business, it could not set up shop in the Village. If it is not fast-food, the use would be permitted in that shopping area.The city planning department staff apparently agreed with Cooper, at least initially. City officials concede that a planning department official sent Cooper an email on Dec. 14, saying, You have the go-ahead from the director to submit the tenant improvement/ building permit application from Papa Murphy's.Cooper claims that he then spent between $30,000 and $40,000 on franchise fees, a property lease, design costs and the application.But Marti Grant, a 25-year island resident who has owned That's a Some Pizza on Winslow Way for 16 years, registered a complaint with the city.They were arguing that they were not a restaurant, Grant said of Cooper's franchise. The definition in the ordinance applies to restaurants or establishments, and Papa Murphy's is an establishment. I pointed that out.City Attorney Rod Kaseguma then reviewed the ordinance. Based on that review, city officials say, the planning department reversed the Dec. 14 communication. On Jan.13, Cooper said, Warren called him at home and told him the city had changed its position.To Cooper and Eglick, an attorney with the Seattle firm Helsell Fetterman, those events smack of hometown favoritism.Meetings were held with the competitor, Eglick alleged before the hearing examiner Monday. This was a search by the city for pretext for denying our application.Not so, said attorney Eric Frimodt, representing the city.This was the first actual application we have received that involves the fast-food ordinance, Frimodt said. Domino's and Starbuck's made inquiries, but never filed applications. So it is important that we get it right. Warren did not really look at the ordinance until the complaint.Frimodt says that planning department officials met with the city council in executive session, they were merely informing the council of the decision, not seeking guidance. It was a closed session, Frimodt said, because of possible litigation. It was an executive session out of concern that (Cooper) had spent money, and that litigation was likely, he told the Review Monday.At Monday's hearing the examiner explored whether Papa Murphy's meets the city's definition of a formula take-out food restaurant.The ordinance defines such businesses as those that are contractually required to offer standardized menus, ingredients and interior or exterior designs.Cooper argued that the many variations between his stores' appearance and food offerings shows that there is not a standard, while the city contended that the existence of some common requirements is enough.The definition also requires that the establishment serves or delivers its food or beverages in disposable containers. Eglick contended that Papa Murphy's does neither.It sells food. It doesn't deliver or serve, he said.Frimodt argued that Cooper was hair-splitting.The city thinks this is more like Domino's, which would be covered by the ordinance, than like a franchise grocery store, which is not covered. The concern in enacting the ordinance was for overall aesthetics, the proliferation of franchises.Grant said Tuesday that her complaint was prompted more by aesthetic considerations than business considerations.Of course I'm concerned about my business, she said. But I'm concerned for the whole island. Today it's Papa Murphy's. But tomorrow it may be Starbuck's, Domino's and Burger King, and the island will start looking like everyplace else.Hearing examiner Baker must decide whether to affirm or reverse the planning department's decision that Papa Murphy's falls under the formula fast-food definition. She cannot determine whether the ordinance is valid, nor whether Cooper may be entitled to damages.Baker's decision, which is expected by month's end and is not subject to review by the city council, may be challenged in court, Eglick said. Tuesday, Warren stood by her decision.I think we applied the definition in the ordinance appropriately, and that it applies to Papa Murphy's, she said.Cooper says he will press the matter in court, and attorney Eglick asserts that the ordinance is vulnerable.You simply can't discriminate against a franchise simply because it's a franchise, he said. Zoning ordinances are to regulate land use, not to discriminate on the basis of ownership. He admitted that the city can regulate the appearance of a business, and Cooper said that he will use a special Bainbridge-friendly sign rather than the standard Papa Murphy's logo.Eglick says the fact that Papa Murphy's would be permitted to open east of Highway 305 is not significant, saying, There are no existing buildings over there, so it's not feasible. Beyond that, though, he said that the city is attempting to discriminate among businesses solely on the basis of ownership.You can have an identical business making an identical product, and if it's not a franchise, it would be allowed, he said. I don't think the city can base any land-use decision on the fact of whether the business is a franchise or not. Eglick said that not only would the validity of the city's ordinance be called into question, but the city would also face a claim for money damages.Even if the city's position is upheld, we would ask for a refund of the money we spent, he said. And if the city's position is not upheld, we would seek damages for the pizzas we couldn't sell during the period of time we were fighting the denial.Eglick said that if island residents don't like franchises, they can vote with their pocketbooks.I've had people tell me that Papa Murphy's is inconsistent with the Bainbridge Island way of life. If that is so, then we'll go out of business. It's not like customers are going to be coming from Poulsbo. If the island doesn't want this, then it won't succeed. But that would be too little, too late, Grant said. Once they're here, they're here, she said. It won't matter whether people go to them. The damage to the island's appearance will be done. "