GJJM ENTERPRISES, LLC v. CITY OF ATLANTIC CITY et al

Filing 40

OPINION. Signed by Judge Joseph H. Rodriguez on 12/21/2017. (tf, )

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
GJJM ENTERPRISES, LLC,
d/b/a STILETTO,

:
:

Plaintiff,
v.

Hon. Joseph H. Rodriguez
Civil Action No. 17-2492

:

OPINION

CITY OF ATLANTIC CITY, CITY OF
:
ATLANTIC CITY POLICE DEPARTMENT,
HENRY WHITE, Chief, Atlantic City
:
Police Department, CHRISTOPHER
PORRINO, New Jersey Attorney General, :
NEW JERSEY DIVISION OF ALCOHOLIC
BEVERAGECONTROL, DAVID P. RIBLE, :
Director of New Jersey Division of Alcoholic
Beverage Control,
:
Defendants.

:

In this lawsuit, Plaintiff GJJM Enterprises, LLC d/b/a Stiletto
(“GJJM”) challenges the constitutionality of New Jersey’s ban on “BYOB”
advertising and has sought declaratory and injunctive relief in asking this
Court to declare N.J. Stat. Ann. § 2C:33-27(a)(2) violative of its First
Amendment rights and to enjoin the government from enforcing the ban.
This matter is before the Court on (1) a motion to dismiss the
Complaint filed by Defendants City of Atlantic City, City of Atlantic City
Police Department, and Henry White, Chief, Atlantic City Police
Department (“Atlantic City Defendants”) [21]; (2) a motion for preliminary

1

injunction filed by GJJM, [5] in Civil Action No. 17-6879, which has been
consolidated under the above-captioned docket number; and (3) a crossmotion to dismiss the Complaint by Defendants New Jersey Division of
Alcoholic Beverage Control, Christopher Porrino, and David P. Rible (“State
Defendants”), [5] in Civil Action No. 17-6879.
The Court heard oral argument on the motions on October 30, 2017;
no testimony was offered beyond affidavits and attached documents. After
careful consideration, GJJM’s motion for a preliminary injunction will be
granted for the reasons and in the form explained below. The following
constitutes the Court’s findings of fact and conclusions of law upon GJJM’s
motion, pursuant to Federal Rule of Civil Procedure 52(a).
Background
GJJM operates a nightlife destination called Stiletto (“the Club”)
adjacent to the Atlantic City boardwalk. The Club features non-alcoholic
beverages and live entertainment and frequently hosts tourists, convention
groups, and bachelor parties. As a service to its customers, GJJM permits
its clientele to bring their own beer and wine (“BYOB”) to consume at the
Club; it does not allow customers consume liquor or mixed drinks in the
Club. (Affidavit of Phillip Griffo, ¶ 3.) GJJM contends that the fear of
prosecution under New Jersey’s ban on BYOB advertising has prevented it

2

from notifying its clients–either through radio, print, television, and online
ads or by exterior or interior signage–that they are permitted to bring their
own beer or wine to the Club.
Presently before the Court is a motion for a preliminary injunction
enjoining the State Defendants 1 from taking any actions to enforce the
statutory provisions that prohibit establishments from advertising that
patrons may bring their own beverages to consume on the premises. Also
under consideration are cross-motions by the Defendants to dismiss the
Complaint.
New Jersey Law
Section 2C:33-27 of the New Jersey Statutes governs the consumption
of alcohol at restaurants that do not have a license to sell alcoholic
beverages. It provides, in pertinent part:
a. No person who owns or operates a restaurant, dining room or
other public place where food or liquid refreshments are sold or
served to the general public, and for which premises a license or
permit authorizing the sale of alcoholic beverages for onpremises consumption has not been issued:
(1) Shall allow the consumption of alcoholic beverages,
other than wine or a malt alcoholic beverage, in a portion of the
premises which is open to the public; or
After hearing oral argument, the Court previously denied Plaintiff’s motion
for a preliminary injunction against the Atlantic City Defendants,
expressing concern that Plaintiff could not demonstrate a likelihood of
success on the merits against them when dealing with a State-wide statute
absent involvement of the State in the case.

1

3

(2) Shall charge any admission fee or cover, corkage or
service charge or advertise inside or outside of such premises
that patrons may bring and consume their own wine or malt
alcoholic beverages in a portion of the premises which is open
to the public.
(3) Shall allow the consumption of wine or malt alcoholic
beverages at times or by persons to whom the service or
consumption or alcoholic beverages on licensed premises is
prohibited by State or municipal law or regulation.
*
*
*
c. A person who violates any provision of this act is a disorderly
person, and the court, in addition to the sentence imposed for
the disorderly person violation, may by its judgment bar the
owner or operator from allowing consumption of wine or malt
alcoholic beverages in his premises as authorized by this act.
N.J. Stat. Ann. § 2C:33-27.
Thus, under the statute, patrons may bring their own beer and wine
to the restaurant, but may not bring outside liquor. 2C:33-27(a)(1). The
restaurant may not, however, advertise–either inside or outside the
establishment–that patrons are permitted to bring their own alcoholic
beverages. 2C:33-27 (a)(2). As a result, restaurants are prohibited from
notifying customers that their establishments are BYOB, even though it is
lawful for patrons to bring and consume their beer or wine on the premises.
Individuals who advertise that customers may BYOB to their restaurants
face prosecution as disorderly persons. 2C:33-27(c). In addition, courts
may also prohibit individuals who violate the advertising ban from
permitting the consumption of BYOB beverages at their restaurants. Id.

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Motion to Dismiss
Federal Rule of Civil Procedure 12(b)(6) allows a party to move for
dismissal of a claim based on “failure to state a claim upon which relief can
be granted.” Fed. R. Civ. P. 12(b)(6). A complaint should be dismissed
pursuant to Rule 12(b)(6) if the alleged facts, taken as true, fail to state a
claim. Fed. R. Civ. P. 12(b)(6). When deciding a motion to dismiss
pursuant to Rule 12(b)(6), ordinarily only the allegations in the complaint,
matters of public record, orders, and exhibits attached to the complaint, are
taken into consideration. 2 See Chester County Intermediate Unit v.
Pennsylvania Blue Shield, 896 F.2d 808, 812 (3d Cir. 1990). The question
before the Court is not whether the plaintiff ultimately will prevail. Watson
v. Abington Twp., 478 F.3d 144, 150 (3d Cir. 2007). Instead, the Court
simply asks whether the plaintiff has articulated “enough facts to state a
claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007).

Although a district court may not consider matters extraneous to the
pleadings, a document integral to or explicitly relied upon in the complaint
may be considered without converting the motion to dismiss into one for
summary judgment.” U.S. Express Lines, Ltd. v. Higgins, 281 F.3d 383,
388 (3d Cir. 2002) (internal quotation marks and citations omitted)
(emphasis deleted).
2“

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“A claim has facial plausibility 3 when the plaintiff pleads factual
content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (citing Twombly, 550 U.S. at 556). “Where there are wellpleaded factual allegations, a court should assume their veracity and then
determine whether they plausibly give rise to an entitlement to relief.”
Iqbal, 556 U.S. at 679.
The Court need not accept “‘unsupported conclusions and
unwarranted inferences,’” Baraka v. McGreevey, 481 F.3d 187, 195 (3d Cir.
2007) (citation omitted), however, and “[l]egal conclusions made in the
guise of factual allegations . . . are given no presumption of truthfulness.”
Wyeth v. Ranbaxy Labs., Ltd., 448 F. Supp. 2d 607, 609 (D.N.J. 2006)
(citing Papasan v. Allain, 478 U.S. 265, 286 (1986)); see also Kanter v.
Barella, 489 F.3d 170, 177 (3d Cir. 2007) (quoting Evancho v. Fisher, 423
F.3d 347, 351 (3d Cir. 2005) (“[A] court need not credit either ‘bald
assertions’ or ‘legal conclusions’ in a complaint when deciding a motion to
dismiss.”)). Accord Iqbal, 556 U.S. at 678-80 (finding that pleadings that
This plausibility standard requires more than a mere possibility that
unlawful conduct has occurred. “When a complaint pleads facts that are
‘merely consistent with’ a defendant’s liability, it ‘stops short of the line
between possibility and plausibility of ‘entitlement to relief.’’” Twombly,
550 U.S. at 557.
3

6

are no more than conclusions are not entitled to the assumption of truth).
Further, although “detailed factual allegations” are not necessary, “a
plaintiff’s obligation to provide the ‘grounds’ of his ‘entitlement to relief’
requires more than labels and conclusions, and a formulaic recitation of a
cause of action’s elements will not do.” Twombly, 550 U.S. at 555 (internal
citations omitted). See also Iqbal, 556 U.S. at 678 (“Threadbare recitals of
the elements of a cause of action, supported by mere conclusory statements,
do not suffice.”).
Thus, a motion to dismiss should be granted unless the plaintiff’s
factual allegations are “enough to raise a right to relief above the
speculative level on the assumption that all of the complaint’s allegations
are true (even if doubtful in fact).” Twombly, 550 U.S. at 556 (internal
citations omitted). “[W]here the well-pleaded facts do not permit the court
to infer more than the mere possibility of misconduct, the complaint has
alleged-but it has not ‘shown’-‘that the pleader is entitled to relief.’” Iqbal,
556 U.S. at 679 (quoting Fed. R. Civ. P. 8(a)(2)).
Nature of the Claim
GJJM’s Constitutional claim is governed by Title 42 U.S.C. § 1983,
which provides a civil remedy against any person who, under color of state
law, deprives another of rights protected by the United States Constitution.

7

See Collins v. City of Harker Heights, 503 U.S. 115, 120 (1992). Any analysis
of 42 U.S.C. § 1983 should begin with the language of the statute:
Every person who, under color of any statute, ordinance, regulation,
custom, or usage, of any State or Territory or the District of Columbia,
subjects, or causes to be subjected, any citizen of the United States or
other person within the jurisdiction thereof to the deprivation of any
rights, privileges, or immunities secured by the Constitution and laws,
shall be liable to the party injured in an action at law, suit in equity, or
other proper proceeding for redress.
See 42 U.S.C. § 1983.
As the above language makes clear, Section 1983 is a remedial statute
designed to redress deprivations of rights secured by the Constitution and
its subordinate federal laws. See Baker v. McCollan, 443 U.S. 137, 145 n.3
(1979). By its own words, therefore, Section 1983 “does not . . . create
substantive rights.” Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir.
2006) (citing Baker, 443 U.S. at 145, n.3).
To state a cognizable claim under Section 1983, a plaintiff must allege
a “deprivation of a constitutional right and that the constitutional
deprivation was caused by a person acting under the color of state law.”
Phillips v. County of Allegheny, 515 F.3d 224, 235 (3d Cir. 2008) (citing
Kneipp v. Tedder, 95 F.3d 1199, 1204 (3d Cir. 1996)). Thus, a plaintiff must
demonstrate two essential elements to maintain a claim under § 1983: (1)
that the plaintiff was deprived of a “right or privileges secured by the
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Constitution or the laws of the United States” and (2) that plaintiff was
deprived of his rights by a person acting under the color of state law.
Williams v. Borough of West Chester, Pa., 891 F.2d 458, 464 (3d Cir. 1989).
The First Amendment, applicable to the States through the
Fourteenth Amendment, prohibits the enactment of laws “abridging the
freedom of speech.” U.S. Const. Amend. I. As such, a government, including
a municipal government vested with State authority, “has no power to
restrict expression because of its message, its ideas, its subject matter, or its
content.” Police Dept. of Chicago v. Mosley, 408 U.S. 92, 95 (1972).
“Content-based laws—those that target speech based on its communicative
content—are presumptively unconstitutional and may be justified only if
the government proves that they are narrowly tailored to serve compelling
state interests.” Reed v. Town of Gilbert, Ariz., --- U.S. ---, 135 S. Ct. 2218,
2226 (2015).
The Eleventh Amendment to the Constitution guarantees the states
immunity from certain claims: “The Judicial power of the United States
shall not be construed to extend to any suit in law or equity, commenced or
prosecuted against one of the United States by Citizens of another State, or
by Citizens or Subjects of any Foreign State.” U.S. Const. Amend. XI. As
such, the Eleventh Amendment has long been held to incorporate a more

9

general principle of sovereign immunity that bars citizens from bringing
suits for damages against any state in federal court. Pennhurst State Sch. &
Hosp. v. Halderman, 465 U.S. 89, 100-01 (1984). Monetary claims for
deprivations of civil rights are subject to the sovereign immunity bar, as the
United States Supreme Court has held that “neither a State nor its officials
acting under their official capacities are ‘persons’ under § 1983.” Will v.
Michigan Dep’t of State Police, 491 U.S. 58, 71 (1989). As such, an employee
of the State named as a defendant in a civil rights action may be held liable
for damages only if that person has personal involvement in the alleged
wrongs and is sued in their personal capacity. See Hafer v. Melo, 502 U.S.
21, 31 (1991) (“state officials, sued in their individual capacities, are
‘persons’ within the meaning of § 1983”). “Of course a state official in his or
her official capacity, when sued for injunctive relief, would be a person
under § 1983 because ‘official-capacity actions for prospective relief are not
treated as actions against the State.’” Will, 491 U.S. at 71 n.10.
A municipality is not liable under 42 U.S.C. § 1983 on a respondeat
superior theory. Monell v. Department of Soc. Servs. of New York, 436 U.S.
658, 691 (1978). However, a government entity may be liable for its agent’s
actions upon a demonstration that a policy or custom of the municipality
caused, or was a “moving force” behind, the alleged violation of a plaintiff’s

10

rights. Kentucky v. Graham, 473 U.S. 159, 166 (1985) (quoting Polk County
v. Dodson, 454 U.S. 312, 326 (1981)); Beck v. City of Pittsburgh, 89 F.3d
966, 971 (3d Cir. 1996). Thus, in order to prevail against the government
entity, “[a] plaintiff must identify the challenged policy, attribute it to the
city itself, and show a causal link between execution of the policy and the
injury suffered.” Losch v. Parkesburg, 736 F.2d 903, 910 (3d Cir. 1984).
Police departments cannot be sued in conjunction with municipalities
because police departments are administrative arms of municipalities, not
separate entities. Adams v. City of Camden, 461 F. Supp. 2d 263, 266
(D.N.J. 2006); Bonenberger v. Plymouth Twp., 132 F.3d 20, 25 (3d Cir.
1997) (holding police department and municipality same for § 1983); N.J.
Stat. Ann. § 40A:14-118 (municipal police department is “an executive and
enforcement function of municipal government”).
Defendants’ motions
As an initial matter, the Court notes that GJJM does not object to
dismissal of its request for monetary damages. [Civil Action No. 17-6879,
Doc. 14.] Regarding the remaining claim for prospective injunctive relief,
the Court finds it has been pled sufficiently.
In briefing, GJJM voluntarily dismissed the claims against the
Atlantic City Police Department and its Chief of Police as duplicative of

11

those against the City. [Doc. 22.] As to Atlantic City, GJJM has failed to
allege the existence of any official policies or customs that may cause or
have caused a constitutional violation. See, e.g., McTernan v. City of York,
Pa., 564 F.3d 636 (3d Cir. 2009) (“[A plaintiff] must identify a custom or
policy, and specify what exactly that custom or policy was.”). The Amended
Complaint does not identify conduct of a municipal decisionmaker or
specify a custom or policy of Atlantic City that could form the basis for
municipal liability. To the contrary, the record indicates that Atlantic City
has not sought to enforce the State statute at issue. GJJM’s conclusory
allegations therefore are unsupported by any facts alleged and insufficient
to state a plausible Monell claim. Accordingly, the City Defendants’ motion
to dismiss the Amended Complaint will be granted.
Next, the New Jersey Division of Alcoholic Beverage Control
(“NJABC”) and its Director argue that they are not proper defendants
because they have no role in enforcing N.J. Stat. Ann. § 2C:33-27. The State
acknowledges “[t]he New Jersey Legislature has delegated authority over
the manufacture, sale, and distribution of alcoholic beverages in the State
to the ABC and has authorized the Director of the ABC, David Rible, to
enforce the State’s rules and regulations related to alcohol. See N.J. Stat.
Ann. § 33:1–3.” [17-6879, Doc. 11.] The State’s ABC Handbook indicates:

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Under no circumstances may any “B.Y.O.B.” (Bring Your Own
Bottle) be advertised in any fashion by an unlicensed restaurant
or other public place where food or beverages are sold to the
general public. A person who is found guilty of violating this
prohibition is considered a disorderly person. By definition
(N.J.S.A. 2C:33-27), B.Y.O.B. prohibits sales of alcohol and
relates to unlicensed premises. Accordingly, questions relating
to B.Y.O.B. are generally not within the purview of the ABC and
should be directed to appropriate local law enforcement
officials.
*
*
*
Since the statute (N.J.S.A. 2C:33-27) applies to non-licensed
premises, violations should be reported to the police
department of the municipality in which the offending
restaurant is located.
Alcoholic Beverage Control Handbook at 12, available at
http://www.nj.gov/oag/abc/downloads/abchandbook02.pdf (last visited
on December 20, 2017). Accordingly, the State argues that local police
departments are the enforcers of the BYOB advertising statute at issue.
During oral argument on the instant motions, the State represented
that under NJABC regulations, an entity could not include religious
symbolism or a statement about curative or therapeutic effects on an
advertisement for happy hour specials. “That’s not permitted when you’re
advertising for alcohol in the State of New Jersey, that’s all under the ABC
regulations” for licensed and regulated entities. (Tr. 29:7-15.) Considering
the current record before it, the Court is not inclined to dismiss NJABC or
Rible as having no responsibility with respect to the regulation of alcohol.

13

Preliminary Injunction Standard
A preliminary injunction “is an extraordinary remedy . . . which
should be granted only in limited circumstances.” American Tel. & Tel. Co.
v. Winback & Conserve Program, Inc., 42 F.3d 1421, 1427 (3d Cir. 1994)
(citation omitted). A preliminary injunction “should not be granted unless
the movant, by a clear showing, carries the burden of persuasion.” Mazurek
v. Armstrong, 520 U.S. 968, 972 (1997) (per curiam) (internal quotations
omitted; emphasis in original). “[T]he requirement for substantial proof” is
higher for “a plaintiff's motion for preliminary injunctive relief” than it is
for a “defendant’s motion for summary judgment[,]” where “one would
demand some evidence . . . in order to avoid a nonsuit.” Id. (emphasis in
original); see also Schuchardt v. President of the U.S., 839 F.3d 336, 351
(3d Cir. 2016) (citing Obama v. Klayman, 800 F.3d 559, 568 (D.C. Cir.
2015) for proposition that “summary judgment imposes a lighter burden
than the ‘substantial likelihood of success’ necessary to obtain
a preliminary injunction”).
To prevail on a motion for preliminary injunctive relief, the moving
party must show as a prerequisite:
(1) a reasonable probability of eventual success in the
litigation, and (2) that it will be irreparably injured ... if relief
is not granted . . . . [In addition,] the district court, in
considering whether to grant a preliminary injunction,
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should take into account, when they are relevant, (3) the
possibility of harm to other interested persons from the
grant or denial of the injunction, and (4) the public interest.
Reilly v. City of Harrisburg, 858 F.3d 173, 176 (3d Cir. 2017)
(quoting Del. River Port Auth. v. Transamerican Trailer Transport, Inc., 501
F.2d 917, 919-20 (3d Cir. 1974) (further internal citations omitted)). “[A]
district court—in its sound discretion—should balance th[e]se four factors
so long as the party seeking the injunction meets the threshold on the first
two.” Reilly, 858 F.3d at 176.
Reasonable probability of success
In order to meet the threshold to establish the first factor, the moving
party “must demonstrate that it can win on the merits (which requires a
showing significantly better than negligible but not necessarily more likely
than not).” Reilly, 858 F.3d at 179. However, “more than a mere possibility
of relief is required” to make the required showing; the moving party must
show “a reasonable probability of eventual success.” Id. at 179 n.3 (internal
quotations omitted).
New Jersey’s statutory ban on BYOB advertising places a contentbased restriction on speech that fails strict scrutiny because it is not
supported by a compelling government interest nor is it the least restrictive
means of achieving the government’s stated purpose. As stated above,

15

“[c]ontent-based laws–those that target speech based on its communicative
content—are presumptively unconstitutional and may be justified only if
the government proves that they are narrowly tailored to serve compelling
state interests.” Reed, 135 S. Ct. at 2226 (citing R.A.V. v. St. Paul, 505 U.S.
377, 395 (1992)). “Commercial speech is no exception.” Sorrell v. IMS
Health, Inc., 564 U.S. 552, 566 (2011) (where Supreme Court applied
heightened “strict scrutiny” standard to cases of commercial speech). In
Reed, the Supreme Court struck down a sign ordinance which included
various exceptions and variable standards depending on whether the sign
was political, elections-oriented, or bore some other non-commercial
message. The Court found that the ordinance was content-based “because
of the topic discussed or the idea or message expressed” and therefore
subject to strict scrutiny. 135 S. Ct. at 2227.
The Court previously held that “when a State entirely prohibits the
dissemination of truthful, nonmisleading commercial messages for reasons
unrelated to the preservation of a fair bargaining process,” its law would be
subject to “rigorous review.” 44 Liquor Mart, Inc. v. Rhode Island, 517 U.S.
484, 501 (1996) (finding unconstitutional a statutory prohibition against
advertisements that provided the public with accurate information about
retail prices of alcoholic beverages). In that case, the Court struck down a

16

Rhode Island statute that prohibited “‘advertising in any manner
whatsoever’ the price of any alcoholic beverage offered for sale in the State;
the only exception [was] for price tags or signs displayed with the
merchandise within licensed premises and not visible from the street.” Id.
at 489. In justifying the implementation of strict scrutiny for content-based
bans, the Court stated, “[o]ur commercial speech cases have recognized the
dangers that attend governmental attempts to single out certain messages
for suppression.” Id. at 501. “[T]hey all but foreclose alternative means of
disseminating certain information.” Id.
As in Reed, the BYOB advertising ban in this case “‘on its face’ draws
distinctions based on the message the speaker conveys.” Reed, 135 S. Ct. at
2227 (citing Sorrell, 564 U.S. 564-66). It is therefore presumptively
unconstitutional and subject to strict scrutiny. Further, as admonished in
44 Liquormart, the ban in this case “fail[s] to leave open ‘satisfactory’
alternative channels of communication.” 44 Liquormart, 517 U.S. at 502
(citations omitted). Rather, it provides a complete ban on truthful,
nonmisleading commercial speech about a lawful product.
The State Defendants have presented no compelling government
interest for banning BYOB advertising, yet permitting liquor stores and
restaurants with liquor licenses to advertise on-site alcohol sales. Citing the

17

Twenty-first Amendment, the State argues that it has a strong interest in
regulating alcoholic beverages to protect the health, safety, and welfare of
the people of the State through the promotion of temperance. The Supreme
Court has made clear, however, specifically with respect to the
advertisement of alcoholic beverages, that banning speech is different from
and more intrusive than banning conduct. See 44 Liquormart, 517 U.S. at
511-12 (“it is no answer that commercial speech concerns products and
services that the government may freely regulate”). See also Players Int’l,
Inc. v. United States, 988 F. Supp. 497 (D.N.J. 1997) (distinguishing
government’s ability to regulate activities from constraints on speech
regarding the activity).
Alternatively, even if the BYOB advertising ban is merely considered
commercial speech, defined as “expression related solely to economic
interests of the speaker and its audience,” Central Hudson Gas & Elec. v.
Public Serv. Comm’n, 447 U.S. 557 (1980), it fails intermediate scrutiny. 4
Under the Central Hudson test, a court first inquires whether the
commercial speech at issue concerns a lawful activity and is not misleading;
if not, it is without First Amendment protection entirely. Central Hudson,

Notably, however, the Supreme Court has applied the heightened strict
scrutiny standard to cases of commercial speech. See Sorrell, 564 U.S. 552.

4

18

447 U.S. at 566. The remainder of the test allows the government to
regulate nonmisleading commercial speech concerning a lawful activity
where: it asserts a substantial interest in regulating the speech; the
regulation directly advances the governmental interest asserted; and the
regulation is not more extensive than necessary to serve that interest. Id.
In Central Hudson, a state public utility commission completely
banned promotional advertising by an electric utility. The Supreme Court
determined that the expression regulated was commercial speech that
should enjoy First Amendment protection to protect the fact that it
informed society, as the utility company’s message promoting the use of
electricity was not misleading or illegal. Additionally, the government had a
substantial interest in conserving energy and preserving a fair rate
structure and the ban on promotional advertising directly advanced those
interests. However, the complete ban was not narrowly tailored to address
the impact of whether the promotional advertising at issue had any impact
on the government’s interest in energy conservation. Id.
Subsequently, a unanimous Supreme Court ruled that a federal law
prohibiting the disclosure of the alcohol content of beer on labels failed the
Central Hudson test’s requirement that the regulation directly advance the
government interest. Rubin v. Coors Brewing Co., 514 U.S. 476 (1995).

19

While federal law prohibited the disclosure of alcohol content on labels
unless required by state law, disclosure of alcohol content in advertising
applied only in 18 states that affirmatively prohibited it. As such, producers
were permitted to disclose alcohol content in advertising in much of the
country, presumably advancing competition for business based on higher
alcohol content. The Court determined that curbing the advertising of
alcohol content of beers would be a better way of coping with strength wars
than regulating labels, so the regulation at issue did not directly advance
the governmental interest asserted. Further, the Court determined that the
federal law prohibiting disclosing alcohol strength on labels was not
sufficiently narrowly tailored to the government’s goal; that is, the
government could directly limit the alcohol content of beer instead. Id.
New Jersey’s ban on BYOB advertising raises similar concerns.
Indeed, in writing for the plurality in 44 Liquormart, Justice Stevens
cautioned that the Central Hudson test should be applied with “special
care,” as blanket bans on commercial speech have historically been
disfavored by the Court and, when unrelated to consumer protection, rarely
survive constitutional review. 517 U.S. at 500, 504. Allowing BYOB
advertising concerns a lawful activity and would not be misleading. The
State, however, has neither asserted a substantial interest in regulating the

20

speech at issue, nor shown that the regulation directly advances the
governmental interest asserted and is not more extensive than necessary to
serve that interest.
Irreparable harm
To satisfy the second factor, the moving party “must demonstrate . . .
the probability of irreparable harm if relief is not granted.” Frank’s GMC
Truck Center, Inc. v. General Motors Corp., 847 F.2d 100, 102 (3d Cir.
1988) (internal quotations omitted). “In order to demonstrate irreparable
harm the plaintiff must demonstrate potential harm which cannot be
redressed by a legal or an equitable remedy following a trial. The
preliminary injunction must be the only way of protecting the plaintiff from
harm.” Instant Air Freight Co. v. C.F. Air Freight, Inc., 882 F.2d 797, 801
(3d Cir. 1989).
The moving party must demonstrate that it is likely to suffer “actual
or imminent harm which cannot otherwise be compensated by money
damages,” or it “fail[s] to sustain its substantial burden of showing
irreparable harm.” Frank’s GMC, 847 F.2d at 103; see also Winter v.
Natural Resources Defense Council, Inc., 555 U.S. 7, 22 (2008) (“Our
frequently reiterated standard requires plaintiffs seeking preliminary relief
to demonstrate that irreparable injury is likely in the absence of an

21

injunction.”) (Emphasis in original). In short, “a movant for preliminary
equitable relief must . . . demonstrate . . . that it is more likely than not to
suffer irreparable harm in the absence of preliminary relief.” Reilly, 858
F.3d at 179 (footnote omitted).
“The loss of First Amendment freedoms, for even minimal periods of
time, unquestionably constitutes irreparable injury.” Elrod v. Burns, 427
U.S. 347, 373 (1976). For that irreparable injury to support granting a
preliminary injunction, plaintiffs must show “a chilling effect on free
expression.” Dombrowski v. Pfister, 380 U.S. 479, 487 (1965). Accord Hohe
v. Casey, 868 F.2d 69, 72-73 (3d Cir. 1989) (noting that “the assertion of
First Amendment rights does not automatically require a finding of
irreparable injury,” rather, “plaintiff[ ] must show ‘a chilling effect on free
expression.’”)
As stated above, damages are not available as an alternative in this
case. In addition, GJJM has noted the chilling effect that the statutory
BYOB advertising ban has had in that it has chosen to censor its
constitutionally protected speech to avoid arrest. Defendants point out that
GJJM has been incorporated since 2009, at which time the BYOB
advertising ban had been in place, so a preliminary injunction should be
denied for failing to meet the requirement of immediate irreparable harm.

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However, where probable success on the merits of a constitutional claim is
shown, and such violation will continue unless enjoined, the continuing
constitutional violation can constitute irreparable harm. Stilp v. Contino,
613 F.3d 405, 409 (3d Cir. 2010) (noting that First Amendment violation
satisfies irreparable injury requirement).
Balance of harms
The third factor requires the court to “balance the parties’ relative
harms; that is, the potential injury to the plaintiffs without this injunction
versus the potential injury to the defendant with it in place.” Issa v. School
Dist. of Lancaster, 847 F.3d 121, 143 (3d Cir. 2017). At this stage, a court
should also take into account “the possibility of harm to other interested
persons from the grant or denial of the injunction.” Reilly, 858 F.3d at 176
(quoting Del. River Port Auth., 501 F.2d at 920 (further citations omitted)).
“[W]hen considerable injury will result from either the grant or denial of
a preliminary injunction, these factors to some extent cancel each
other[.]” Del. River Port Auth., 501 F.2d at 924. The assertion of serious
First Amendment questions has been held to compel a finding that the
balance of hardships tips sharply in the plaintiff’s favor. American Bev.
Ass’n v. San Francisco, 871 F.3d 884, 898 (9th Cir. 2017). (quotation
omitted).

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The Court finds that balancing the parties’ harms in this case favors
granting an injunction.
Public interest
Finally, the Supreme Court has noted that “parts of equity may, and
frequently do, go much farther both to give and withhold relief in
furtherance of the public interest than they are accustomed to go when only
private interests are involved.” Instant Air Freight, 882 F.2d at 803
(quoting Virginian Ry. Co. v. System Fed’n No. 40, 300 U.S. 515, 552
(1937)). “In exercising their sound discretion, courts of equity should pay
particular regard for the public consequences in employing the
extraordinary remedy of injunction.” Weinberger v. Romero-Barcelo, 456
U.S. 305, 312 (1982). While weighing whether the public interest favors
a preliminary injunction “is often fairly routine,” Issa, 847 F.3d at 143
(internal quotations omitted), “‘where an injunction is asked which will
adversely affect a public interest for whose impairment, even temporarily,
an injunction bond cannot compensate, the court may in the public interest
withhold relief until a final determination of the rights of the parties,
though the postponement may be burdensome to the plaintiff.’”
Weinberger, 456 U.S. at 312-13 (quoting Yakus v. United States, 321 U.S.
414, 440 (1944)).

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When there are no societal benefits justifying the suppression of First
Amendment rights, the public interest is in favor of granting an injunction.
Tenafly Eruv Assoc., Inc. v. Borough of Tenafly, 309 F.3d 144, 177 (3d Cir.
2002). Further, there is a public interest in preventing the hindrance of
consumer choice as well as impediments to debate over issues of public
policy. See, e.g., 44 Liquormart, 517 U.S. at 495-97, 503 (describing history
and importance of advertising in United States; “the same interest that
supports regulation of potentially misleading advertising, namely, the
public’s interest in receiving accurate commercial information, also
supports an interpretation of the First Amendment that provides
constitutional protection for the dissemination of accurate and
nonmisleading commercial messages”); Pacific Gas & Elec. Co. v. Pub.
Utilities Comm’n of California, 475 U.S. 1, 8 (1986) (“By protecting those
who wish to enter the marketplace of ideas from government attack, the
First Amendment protects the public’s interest in receiving information.”);
Virginia Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425
U.S. 748, 765 (1976) (“It is a matter of public interest that [commercial]
decisions, in the aggregate, be intelligent and well informed. To this end,
the free flow of commercial information is indispensable.”).

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The BYOB advertising ban here implicates the rights of consumers to
obtain truthful advertising to make informed decisions regarding
businesses and services.
Conclusion
Here, the status quo has not only been non-enforcement, but also has
been no BYOB advertising by GJJM. Thus, maintaining the status quo in
this case requires that the parties continue to act as they have, namely, the
Defendants will not enforce and GJJM will not advertise before an
adjudication on the merits can be made as to whether the statute is
unconstitutional.
In summary, the motion to dismiss the Complaint filed by Defendants
City of Atlantic City, City of Atlantic City Police Department, and Henry
White, Chief, Atlantic City Police Department [21] will be granted. The
motion for preliminary injunction filed by GJJM, [5] in Civil Action No. 176879, will be granted in the form discussed above, and the cross-motion to
dismiss the Complaint by Defendants New Jersey Division of Alcoholic
Beverage Control, Christopher Porrino, and David P. Rible, [5] in Civil
Action No. 17-6879, will be denied. An appropriate Order will issue.
Dated: December 21, 2017

/s/ Joseph H. Rodriguez
JOSEPH H. RODRIGUEZ
U.S.D.J.
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