Eleventh Circuit Rejects Constitutional Challenge to Brookhaven Ordinance Regulating “Sexually Oriented Businesses”

In 2013, the City of Brookhaven enacted its code 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 new code did not ban establishments that “regularly feature[] sexual devices,” but did prohibit any such establishment from operating within 100 feet of another sexually oriented business or within 300 feet of a residential district, place of worship, park, or public library.  This left 73 locations in the City where a covered establishment might operate.

In February 2013, shortly after the code was enacted, Stardust opened a retail store in the city, identifying its business as “Retail—Smoke Shop, Tobacco; related accessories; gifts.”  Stardust’s store was across the street from a residential area and next to Pink Pony, an adult entertainment club covered by the code.  Stardust later informed the city that it was going to begin selling, as a non-principal business activity, goods covered by the code.  The City began ticketing Stardust for non-compliance with the code and, in early 2014, filed a complaint against Stardust in Brookhaven Municipal Court.  A few months later, Stardust filed its own action in the Superior Court of DeKalb County, seeking to enjoin the City’s enforcement of the code on constitutional grounds.  A few months after that, Stardust filed another action, this one in federal court, challenging the City’s denial of Stardust’s application for a sign permit (which had been based on the City’s claim that Stardust was operating unlawfully).  The district court granted the City’s motion for summary judgment, and Stardust appealed.

While the appeal was pending, the Superior Court of DeKalb County entered a permanent injunction against Stardust in the state court action.  That court held that Stardust’s claims under the United States Constitution were barred by res judicata because of the federal district court’s order.  As to the claims under the Georgia Constitution, the superior court held that they were also barred by res judicata because of the identity between the two constitutions’ provisions and, in the alternative, that the claims failed on the merits.  The Georgia Supreme Court affirmed without an opinion.

In the Eleventh Circuit, the first question was whether the court was bound as a matter of res judicata to defer to the Georgia Supreme Court’s decision—which had affirmed a decision that was itself based on res judicata based on the decision of the (federal) district court.  Stardust, 3007 LLC v. City of Brookhaven, 2018 WL 3801661 (11th Cir. Aug. 10, 2018).  The Eleventh Circuit held, in agreement with decisions from other circuits, that it was not:  “it would make no sense for an appeal from a district court order or judgment to be precluded simply because another court treated the order or judgment as having preclusive effect.”

On the merits, the court affirmed the decision of the district court.  In an opinion written by Judge Jill Pryor and joined by Judge William Pryor and by Judge Raymond C. Clevenger III visiting from the Federal Circuit, the court held that the code’s application to any shop that “regularly features” sexual devices did not unconstitutionally restrict Stardust’s freedom of speech.  Stardust argued that the definition of “regularly features” relied on the manner in which a particular store displayed its merchandise, and the court agreed.  But “neither the United States Supreme Court nor this court has ever held that a business has a free speech interest in the display and arrangement of commercial products . . . .”  And even assuming that the code’s definition implicated the First Amendment, it was a content-neutral “time, place, and manner restriction,” and the City was able to show that the code advanced the City’s legitimate “interest in attempting to preserve the quality of urban life.”  Stardust was unable to “cast direct doubt on the [City’s] rationale, either by showing that the [City’s] evidence does not actually support its rationale or by producing evidence disputing the [City’s] factual findings.”  And the Code “leaves open sufficient alternative avenues of communication”—it was undisputed that there were 73 sites in the City at which, consistent with the Code, a “sexually oriented business” could operate.

The court also rejected Stardust’s claims that the phrase “establishment primarily dedicated to healthcare products”—the subject of an exception to the regulations—and the word “feature,” defined by the Code to mean “to give special prominence to,” were impermissibly vague.  Here, the court observed that “[t]he Constitution does not require perfect clarity in the language of statutes and ordinances,” and that to succeed on a vagueness challenge, “the complainant must demonstrate that the law is impermissibly vague in all of its applications.”  The record demonstrated no genuine issue as to whether Stardust might be considered “primarily dedicated to healthcare products,” and the fact that Stardust devoted more than one full room to sexual devices demonstrated that “its operation clearly falls within the zone of prohibited conduct.”

The court also rejected Stardust’s equal protection challenge, which was based on Pink Pony’s operation within the same 100-foot radius.  The two were not similarly situated, because Pink Pony had agreed to pay for additional police presence and to relocate within a stated number of years.  And there was a rational basis for any difference in treatment, anyway—“[b]ecause Stardust and Pink Pony were operating within 100 feet of each other, and both were sexually oriented businesses, ‘it is beyond cavil that, to comply with the statute, one may stay and one must go.’”

Posted by Valerie Sanders.

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