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Metro Pony, LLC v. City of Metropolis

April 20, 2012

METRO PONY, LLC, PLAINTIFF,
v.
CITY OF METROPOLIS, DEFENDANT.



The opinion of the court was delivered by: J. Phil Gilbert District Judge

MEMORANDUM AND ORDER

This matter comes before the Court on the motion for summary judgment filed by defendant City of Metropolis ("the City") (Doc. 47). Plaintiff Metro Pony, LLC has responded to the motion (Doc. 51), and the City has replied to that response (Doc. 52). Summary judgment is appropriate where "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." Fed. R. Civ. P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Spath v. Hayes Wheels Int'l-Ind., Inc., 211 F.3d 392, 396 (7th Cir. 2000). The Court construes the evidence in the light most favorable to the nonmoving party and draws all reasonable inferences in favor of that party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986); Chelios v. Heavener, 520 F.3d 678, 685 (7th Cir. 2008); Spath, 211 F.3d at 396.

I. Facts

Metro Pony, a business that offers live artistic dance performances that include nudity and sells DVDs of a sexual nature, began operations in the City in December 2010. Metro Pony's brief describes the establishment as follows:

Metro Pony is an adult cabaret that presents to its patrons artistic dance performances by female entertainers who, during the course of their performances, remove their clothing and appear fully nude. These performances take place on stage, at tableside and in a monitored VIP room. The nightclub operates as a BYOB establishment; it does not serve alcohol to its patrons but does allow them to bring in their own alcohol beverages to consume. Metro Pony presents dance performances from noon until 3:00 a.m. Sunday through Tuesday, and from noon to 5:00 a.m. on weekends. In addition to presenting dance performances, Metro Pony also offers adult oriented DVDs for its customers to purchase for viewing in the privacy of their homes.

Pl.'s Br. 1.

In response to public petitions opposing the opening of Metro Pony, the City Council contemplated regulating sexually oriented businesses like Metro Pony. In deciding to enact such regulations, it considered judicial opinions, crime reports, news articles, expert reports and affidavits, and it held a public hearing that included a presentation about negative secondary effects associated with sexually oriented businesses. On February 14, 2011, the Metropolis City Council passed Ordinance 2011-2 to regulate sexually oriented businesses.

Among other things, Ordinance 2011-2 does the following:

* requires annual licensing of sexually oriented businesses and the people who work for them, Ord. §§ 117.03-117.11;

* prohibits nudity, sex and touching patrons in a sexually oriented business, Ord. §§ 117.17(a) & (c);

* requires semi-nude dancers in a sexually oriented business to remain at least six feet from patrons, on a stage 18 inches high, and in a room of at least six hundred square feet, Ord. § 117.17(b);

* prohibits sexually oriented business operations from midnight to 6 a.m., Ord. § 117.12; * requires sexually oriented businesses to post at least two no loitering signs, inspect the premises every 90 minutes or monitor it by video, and provide sufficient lighting for such inspections, Ord. § 117.14(a);

* requires sexually oriented businesses to light interior areas where patrons are permitted to a level of five footcandles whenever a patron is present, Ord. § 117.14(b);

* prohibits sexually oriented businesses from constructing barriers such as fences or walls that hide any portion of its parking lot from public view, Ord. § 117.14(c); and

* prohibits the possession, use and consumption of alcohol on the premises of a sexually oriented business, Ord. § 117.17(d).

A knowing or reckless violation of any of these rules subjects the business to suspension or revocation of its license. § 117.08-10. A violation also subjects the business to criminal misdemeanor proceedings and civil nuisance abatement proceedings. § 117.15.

Because of the content of the entertainment and products it offers, Metro Pony falls into Ordinance 2011-2's classification as a sexually oriented businesses. In fact, it is the only business in the City that does. Therefore, Ordinance 2011-2's requirements do not apply to other businesses within the City.

The Preamble and the text of Ordinance 2011-2 offer a rationale for its adoption. The Preamble states the City Council's finding "that sexually oriented businesses, as a category of establishments, are frequently used for unlawful sexual activities, including prostitution and sexual liaisons of a casual nature." Ord. Preamble ¶ 2.

The text of Ordinance 2011-2 describes its purpose:

(a) Purpose. It is the purpose of this chapter to regulate sexually oriented businesses in order to promote the health, safety, and general welfare of the citizens of the City, and to establish reasonable and uniform regulations to prevent the deleterious secondary effects of sexually oriented businesses within the City. The provisions of this chapter have neither the purpose nor effect of imposing a limitation or restriction on the content or reasonable access to any communicative materials, including sexually oriented materials. Similarly, it is neither the intent nor effect of this chapter to restrict or deny access by adults to sexually oriented materials protected by the First Amendment, or to deny access by the distributors and exhibitors of sexually oriented entertainment to their intended market. Neither is it the intent nor effect of this chapter to condone or legitimize the distribution of obscene material.

Ord. § 117.01(a). Ordinance 2011-2 also sets forth the findings and rationale of the City Council in adopting the law: (b) Findings and Rationale. Based on evidence of the adverse secondary effects of adult uses presented in hearings and in reports made available to the City Council, and on findings, interpretations, and narrowing constructions incorporated in [numerous case decisions]; and based upon reports concerning secondary effects occurring in and around sexually oriented businesses including [numerous reports]; the City Council finds:

(1) Sexually oriented businesses, as a category of commercial uses, are associated with a wide variety of adverse secondary effects including, but not limited to, personal and property crimes, prostitution, potential spread of disease, lewdness, public indecency, obscenity, illicit drug use and drug trafficking, negative impacts on surrounding properties, urban blight, litter, and sexual assault and exploitation. Alcohol consumption impairs judgment and lowers inhibitions, thereby increasing the risk of adverse secondary effects.

(2) Each of the foregoing negative secondary effects constitutes a harm which the City has a substantial government interest in preventing and/or abating. This substantial government interest in preventing secondary effects, which is the City's rationale for this chapter, exists independent of any comparative analysis between sexually oriented and non-sexually oriented businesses. Additionally, the City's interest in regulating sexually oriented businesses extends to preventing future secondary effects of either current or future sexually oriented businesses that may locate in the City. The City finds that the cases and documentation relied on in this chapter are reasonably believed to be relevant to said secondary effects.

The City hereby adopts and incorporates herein its stated findings and legislative record related to the adverse secondary effects of sexually oriented businesses, including the judicial opinions and reports related to such secondary effects.

Ord. § 117.01(b).

On February 23, 2011, Metro Pony brought this action pursuant to 42 U.S.C. § 1983 alleging that the City violated its First Amendment rights. On February 24, 2011, the Court granted Metro Pony's motion for a temporary restraining order and enjoined the City from enforcing Metropolis Ordinance 2011-2 until and including March 9, 2011, when a preliminary injunction hearing was to be held (Doc. 19). Before that hearing could be held, the City agreed not to enforce Ordinance 2011-2 until the Court ruled on dispositive motions. In light of this agreement, the Court cancelled the preliminary injunction hearing and extended the terms of the temporary restraining order by consent of the parties until a dispositive motion ruling (Doc. 24).

While awaiting a ruling on the City's dispositive motion, two investigators witnessed instances of illicit sexual behavior, including conduct that could be construed as prostitution, within Metro Pony's establishment, although they did not observe nor investigate any increased crime in the vicinity of Metro Pony. There is no record of an increase in crime or urban blight in the vicinity of Metro Pony since it began its operations.

II. Analysis of First Amendment Claims

The First Amendment to the United States Constitution provides "Congress shall make no law . . . abridging the freedom of speech . . . ." U.S. Const. amend. 1. The Due Process Clause of the Fourteenth Amendment makes First Amendment free speech guarantees applicable to states and their municipalities. Gitlow v. New York, 268 U.S. 652, 666 (1925); Ben's Bar, Inc. v. Village of Somerset, 316 F.3d 702, 707 (7th Cir. 2003).

Ben's Bar describes the two strains of jurisprudence that have developed to analyze potential First Amendment violations relating to adult entertainment regulations. Ben's Bar, 316 F.3d at 713. The first developed in the context of adult entertainment zoning ordinances. It began with Young v. American Mini Theatres, Inc., 427 U.S. 50 (1976), and was modified by City of Renton v. Playtime Theatres, Inc., 475 U.S. 41 (1986), and City of Los Angeles v. Alameda Books, Inc., 535 U.S. 425 (2002). That line analyzes zoning regulations as content-neutral time, place and manner restrictions. Ben's Bar, 316 F.3d at 713. Under that test, A time, place, and manner regulation of adult entertainment will be upheld if it is "designed to serve a substantial government interest and . . . reasonable alternative avenues of communication remain available." Alameda Books, [535 U.S. at 434]. Additionally, a time, ...


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