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Wednesday, December 13, 2023

Court Dismisses Challenge to City Business License Denial

An Illinois Appellate Court ruled in favor of a city in a lawsuit involving a business owner challenging the city's denial of a business license, finding that the owner had not exhausted its administrative appeals. Mary Jane Sweet Spot LLC v. City of Blue Island

In this case, an owner filed for a business license to operate a small bakery. The city clerk discovered that before the owner obtained its business license and other approvals, including a liquor license, the owner had thrown a large gathering at its future business address and was planning to throw another large gathering, with alcohol, which violated city code. Based on these actions and misstatements of the scope of the business on the license application, the city denied the business license application. The owner appealed the denial at an administrative hearing, where the administrative hearing officer issued a decision recommending that the city council uphold the denial of the license. The owner did not, however, take the appeal to the city council and instead filed a lawsuit against the city. 

The Appellate Court determined that the owner failed to exhaust its administrative remedies before filing the lawsuit. The city code included language providing for an appeal of a business license denial before the city council. The owner appealed the city's denial of the license to the city's administrative hearing officer who recommended the city council uphold the denial of the business license. The owner then filed a lawsuit, but never actually appealed to the city council. Because the owner did not complete all of its opportunities for administrative relief, the Appellate Court dismissed the lawsuit as premature.

Post Authored by Daniel Lev, Ancel Glink


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