The opinion of the court was delivered by: Murphy, Chief District Judge
On June 6, 2006, the Court, sitting without a jury, conducted a trial on the claims of Plaintiffs' first amended supplemental complaint (Doc. 45). Pursuant to Federal Rule of Civil Procedure 52, the Court now makes the following findings of fact and conclusions of law.
The early background of this case is set forth in the Seventh Circuit's opinion on the appeal of this Court's issuance of a preliminary injunction. See Joelner v. Village of Washington Park, Illinois, 378 F.3d 613 (7th Cir. 2004). In a nutshell, the case involves Eric Joelner's attempt to obtain licenses to conduct adult entertainment businesses within the Village of Washington Park, Illinois (the "Village"). Joelner is the president and sole shareholder of Fish, Inc., d/b/a XXXtreme Entertainment, Free Speech, Inc., and First Amendment, Inc. He currently operates an adult video and bookstore at 2226 Kingshighway in the Village, and he seeks to obtain additional licenses to operate adult entertainment businesses at 2219-2221 Kingshighway and 5900-6100 Bunkum Road.
On June 12, 2003, this Court granted in part and denied in part a request for a preliminary injunction. The Court found that certain ordinances which imposed limitations on the number of adult entertainment outlets and hefty fees for obtaining a license were constitutional and refused to enjoin the Village from enforcing the ordinances. The Court refused to require the Village to issue new licenses but ordered it to allow Joelner to continue operating at his current business (2226 Kingshighway). The Court also ordered the Village to consider in a new hearing Joelner's application for a cabaret license at the current location so long as he paid arrearages and the newly approved fees.
The Seventh Circuit affirmed in part, vacated in part, and remanded the case for further proceedings. Id. The Seventh Circuit found that this district court correctly refused to preliminarily enjoin the Village from enforcing the ordinances and appropriately ordered the Village to allow Joelner to continue operating his current business. The Seventh Circuit also found, however, that this Court erred in requiring Joelner to pay the disputed fees and in ordering the Village to hold a hearing on his cabaret license application.
After the Court received the Seventh Circuit's mandate, the case was set for a bench trial on April 19, 2005. Days before the final pretrial conference was held, the Village moved to dismiss the case for mootness. It argued that the Village had just passed a new ordinance, No. 01-63, which repealed the four ordinances that were the subject of the earlier appeal, thereby rendering the case moot. Plaintiffs countered with a request to file an amended complaint, arguing that the new regulatory scheme is still unconstitutional and that the Village had refused Joelner's applications for a license under the new ordinance. That request was granted, and the instant amended complaint was filed on August 8, 2005.
The new Ordinance 01-63 does away with the ban on the number of licenses, eliminates the distinction between cabarets and adult bookstores, and lowers the licensing fee to $1,200. But there is a catch: the new ordinance also states:
It shall be a violation of this ordinance for any person to sell, use, or consume alcoholic beverages on the premises of a sexually oriented business. This prohibition shall not apply to entities licensed as adult cabarets under prior Village ordinances. (See Trial Exhibit 1, Section 18.) Thus, the ordinance bans the sale of alcohol at future licensed adult entertainment businesses, but exempts current licensees. It also exempts current licensees from other new restrictions. (See Trial Exhibit 1, Sections 4, 13, and 14.)
The amended complaint consists of three counts. The first seeks a declaratory judgment that ordinances 069-99, 01-22 and 01-63 are facially unconstitutional and as applied. Plaintiffs seek a declaration that the Village has unconstitutionally retaliated against Plaintiffs for exercising their First and Fourteenth Amendment rights, as well as a declaration that the Village has violated the Fourteenth Amendment by treating similarly situated businesses differently without an important government objective for doing so. Plaintiffs also seek a preliminary and permanent injunction allowing their business to remain open at its present location, barring the Village from imposing a $30,000 license fee or head tax, ordering the Village to issue sexually oriented business licenses under the same terms and conditions as all similarly situated businesses for Plaintiffs' property at 2219-2221 Kingshighway and 2226-2244 Kingshighway, and on vacant property at 5900-6100 Bunkum Road, and enjoining the Village from any further interference with Plaintiffs' business. The Village claims it has offered Eric Joelner a license under the new ordinance, but he has refused it.
1. Eric Joelner has an ownership interest in the properties located at 2226 Kingshighway, 2219-2221 Kingshighway, and 5900-6100 Bunkum Road, as he, personally and/or through his various corporate entities, is paying rent to a corporation owned by his wife for two of them (2226-2228 Kingshighway and 2219-2221 Kingshighway) and purchasing the other (5900-6100 Bunkum Road).
2. There are eight businesses in the Village holding adult entertainment licenses under the previous ordinances: Miss Kitty's, DeJa Vu (d/b/a Larry Flynt's Hustler Club), Hollywood Showclub, C-Mowe's, Dollie's, Soft Touch, LILD, and Insane Management Company.
3. Six of these are currently operating as adult entertainment establishments, hold liquor licenses issued by the Village, and serve alcohol: Miss Kitty's, DeJa Vu (d/b/a Larry Flynt's Hustler Club), ...