ATL Corporation v. City of Seattle

Filing 89

SECOND ORDER granting in part and denying in part pltf's 65 Motion for Partial Summary Judgment; granting in part and denying in part dft's 69 Cross Motion for Partial Summary Judgment by Judge Robert S. Lasnik.(RS)

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1 2 3 4 5 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 6 7 8 9 10 11 12 13 _______________________________________ ) ATL CORPORATION, ) ) Plaintiff, ) v. ) ) CITY OF SEATTLE, ) ) Defendant. ) _______________________________________) No. C09-1240RSL SECOND ORDER REGARDING CROSS-MOTIONS FOR SUMMARY JUDGMENT 14 This matter comes before the Court on “Plaintiff’s Motion for Partial Summary 15 Judgment” (Dkt. # 68) and the “City of Seattle’s Cross-Motion for Partial Summary Judgment” 16 (Dkt. # 69). Summary judgment is appropriate where admissible evidence, read in the light most 17 favorable to the non-moving party, shows that there is no genuine issue of material fact that 18 would preclude entry of judgment in favor of the moving party. Bruce v. Ylst, 351 F.3d 1283, 19 1287 (9th Cir. 2003). The parties agree that the facts related to plaintiff’s First Amendment 20 challenges to SMC 23.47A.004(H) are not in dispute.1 Having reviewed the memoranda, 21 declarations, and exhibits submitted by the parties, and having heard the arguments of counsel, 22 the Court finds as follows: 23 24 25 1 26 Other than one sentence in the City’s reply memorandum (Dkt. # 79 at 18), the parties have not addressed issues related to damages. SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT BACKGROUND 1 The City of Seattle regulates adult entertainment businesses through licensing and 2 3 permitting requirements.2 Plaintiff alleges that one of the factors considered when issuing a 4 building or land use permit, the dispersion requirement of SMC 23.47A.004.H, is 5 unconstitutional on its face because the deadline for making a decision is unreasonably long, that 6 the ordinance was applied in an unconstitutional manner when the City refused to accept 7 plaintiff’s application for a permit when originally tendered, and that the ordinance is not 8 narrowly tailored to serve a significant government interest. 9 In early 2009, plaintiff sought permission to remodel a building located at 10504 10 Aurora Avenue North. At the time, the relevant portions of the City’s commercial zoning and 11 land use ordinance stated: 12 H. Adult Cabarets. 13 1. Any lot line of property containing any proposed new or expanding adult cabaret must be eight hundred (800) feet or more from any lot line of property containing any community center; child care center; school, elementary or secondary; or public parks and open space use. 14 15 16 17 18 19 2. Any lot line of property containing any proposed new or expanding adult cabaret must be six hundred (600) feet or more from any lot line of property containing any other adult cabaret. SMC 23.47A.004.H. Although the dispersion requirement does not contain its own deadline for 20 21 22 23 24 25 26 2 Earlier in this litigation, the licensing requirement contained in SMC 6.270.090 was struck down because the ordinance did not contain a time limit within which the government was required to make a decision on a license application. The Court found that, in the absence of a deadline for government action, the ordinance granted unbridled discretion to the City to delay, and thereby prohibit, speech protected by the First Amendment of the United States Constitution. The requirement that an adult entertainment business obtain a license was therefore invalidated and severed. The ordinance’s other provisions, including, but not limited to, the standards of conduct, disclosure requirements, and operational requirements, were left intact and are not at issue in this motion. “Order Regarding CrossMotions for Summary Judgment,” Dkt. # 43 at 6-7 and 11 (dated July 19, 2010). SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -2- 1 government action, the City has imposed a default 120 day time limit in which to rule on all land 2 use applications. SMC 23.76.005. The time limit is part of a larger effort to integrate, 3 consolidate, and expedite the land use permitting process to avoid redundancy, minimize delays, 4 and reduce the cost of development. SMC 23.76.002. 5 On December 31, 2008, plaintiff contacted the City’s Department of Planning and 6 Development (“DPD”) to determine what land use permits would be necessary in order to add a 7 stage to an existing restaurant facility at 10504 Aurora Avenue North. Plaintiff was told which 8 permits would be required and what information had to be submitted. Decl. of Judy Singh (Dkt. 9 # 27), Ex. A. At some point in mid-January 2009, the “neighborhood” surrounding the proposed 10 facility informed DPD that plaintiff was planning to open an adult cabaret at the facility and that 11 there were incompatible uses in the immediate vicinity. Id. When plaintiff attempted to file a 12 building permit application for the proposed remodel on January 23, 2009, DPD refused to 13 accept the application because the dispersion criteria of SMC 23.47A.004.H had not been 14 addressed. DPD provided information regarding how to make measurements for purposes of 15 the dispersion criteria and requested additional changes to the plans regarding construction and 16 safety details. Id. Plaintiff attempted to resubmit its plans on February 9, 2009, asserting that 17 two potentially problematic facilities in the vicinity of the property were not actually 18 inconsistent uses under the dispersion criteria. DPD disagreed and again rejected the plans on 19 the ground that plaintiff had not demonstrated compliance with the dispersion requirements. Id. 20 In July 2009, plaintiff’s counsel contacted the City and successfully argued that DPD’s refusal to 21 accept plaintiff’s permit application was an unconstitutional prior restraint on protected speech. 22 Decl. of Kristin Olson (Dkt. # 19), Ex. 10. DPD staff were instructed to accept plaintiff’s 23 application for an adult cabaret if it met the submittal requirements and included a representation 24 that the applicant believed the dispersion requirements were satisfied. Decl. of Judy Singh (Dkt. 25 # 27), Ex. A. 26 When plaintiff submitted its permit application for a third time on August 18, SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -3- 1 2009, it was accepted by DPD. The application to establish a new adult cabaret at 10507 Aurora 2 Avenue North was denied, however, on September 1, 2009. DPD’s review of the permit history 3 for the properties identified by the neighbors showed that a facility with a day care center permit 4 was located 742 feet east of the property and that a facility in which another adult cabaret was 5 permitted to operate was located 342 feet from the property. Decl. of Kristin Olson (Dkt. # 19), 6 Ex. 15. These prior uses had been permitted in 1971 and 1989, respectively, but were not 7 operating at the time plaintiff applied for its building permit.3 DISCUSSION 8 9 I. UNBRIDLED DISCRETION The right to open and operate an adult cabaret featuring topless, exotic, or nude 10 11 dancing is protected speech under the First Amendment. Young v. City of Simi Valley, 216 12 F.3d 807, 815 (9th Cir. 2000). Cities are permitted to impose time, place, and manner 13 restrictions on such speech in order to “combat the undesirable secondary effects” of adult 14 businesses (City of Renton v. Playtime Theatres, Inc., 475 U.S. 41, 49 (1986)), but certain 15 procedural safeguards must be in place to ensure that the government does not have unbridled 16 discretion to suppress the protected speech (Jersey’s All-American Sports Bar, Inc. v. Wash. 17 State Liquor Control Bd., 55 F. Supp.2d 1131, 1138 (W.D. Wash. 1999)). A permitting scheme 18 “that fails to place limits on the time within which the decisionmaker must issue the license is 19 impermissible” because it creates the possibility of suppression through delay. FW/PBS, Inc. v. 20 City of Dallas, 493 U.S. 215, 227 (1990). SMC 23.47A.004.H does not confine the time within which the government must 21 22 make a decision regarding compliance with the dispersion criteria. The City argues that the 23 default 120-day deadline contained in SMC 23.76.005 brings SMC 23.47A.004.H into 24 compliance with the constitutional requirements discussed above by limiting the municipality’s 25 26 3 The adult cabaret has since reopened its doors and is again in operation. SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -4- 1 2 3 ability to delay protected speech. A. Facial Challenge In its motion, plaintiff asserts that SMC 23.47A.004.H is unconstitutional both on 4 its face and as applied. Motion (Dkt. # 65) at 18-19. Plaintiff subsequently acknowledged, 5 however, that the 120-day deadline is not always unreasonable: “ATL is not arguing that just 6 because a project is subject to First Amendment protection, that a decision on a construction 7 permit for a large and complex project, such as a downtown skyscraper must be made within 120 8 days or that SMC 23.76.005 by itself is unconstitutional.” Reply (Dkt. # 72) at 5 (internal 9 quotation marks and footnote omitted). The difference between a facial and an as-applied 10 challenge is the scope of the remedy. A successful facial challenge will result in a finding that a 11 particular law can never be validly enforced, whereas a successful as-applied challenge will 12 prevent the law from being enforced in some, but not all, circumstances. See, e.g., 4805 13 Convoy, Inc. v. City of San Diego, 183 F.3d 1108, 1111 (9th Cir. 1999). Having conceded that 14 the government would, in some circumstances, need 120-days to conduct a dispersion analysis as 15 part of a large-scale project, plaintiff is not entitled to a declaration that SMC 23.47A.004.H is 16 unconstitutional on its face. 17 At oral argument, plaintiff took the position that, because it plans to engage in First 18 Amendment protected activities, the City should be required to perform the dispersion analysis 19 of SMC 23.47A.004H in less than 120 days. The existence of inconsistent uses is simply one 20 factor that must be considered when a property owner requests a land use permit from the City of 21 Seattle. The City has developed an “integrated and consolidated land use permit process” (SMC 22 23.76.002) designed to ameliorate the delays, conflicts, and duplication that arose when local 23 and state authorities required a number of separate land use permits and environmental reviews 24 for a single project (RCW 36.70B.010). Plaintiff apparently wants the Court to undo the 25 consolidated process so that the dispersion analysis has its own application process and review 26 deadline. Plaintiff offers no authority for its underlying assumption that it is entitled to an SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -5- 1 expedited and/or separate permit process simply because a First Amendment activity is at issue. 2 Courts have upheld municipal regulations that combine adult licensure, building permit, and 3 health, fire, and zoning reviews. See Redner v. Dean, 29 F.3d 1495, 1497-98, 1501 (11th Cir. 4 1994). In addition, a permit scheme that “applies reasonably objective, nondiscretionary criteria 5 unrelated to the content of the expressive materials that an adult business may sell or display” is 6 unlikely to suppress protected speech in the community and does not require accelerated 7 consideration. See City of Littleton, Colo. v. Z.J. Gifts D-4, LLC, 541 U.S. 774, 783, 787 8 (2004). Thus, the City is not required to provide a separate application process or expedited 9 review for projects that are subject to the dispersal requirements of SMC 23.47A.004(H). To the extent plaintiff is arguing that 120 days is an unreasonably long period of 10 11 time in which to consider a consolidated land use permit application, the Court finds that 12 plaintiff is collaterally estopped from re-litigating the facial validity of the 120-day permit 13 processing deadline. The Honorable Suzanne Barnett of the King County Superior Court 14 addressed precisely this issue on March 11, 2011, resulting in a final judgment in the City’s 15 favor. City of Seattle v. Robert A. Davis, et al., C11-2-04927-SEA. ATL, the plaintiff in this 16 matter, is controlled by Robert Davis, a named party in the state court litigation. Despite the fact 17 that this litigation was pending long before the City initiated its enforcement action before Judge 18 Barnett, the application of the doctrine of collateral estoppel will not work an injustice on 19 plaintiff. Through its president and sister corporation, plaintiff had a full and fair opportunity to 20 litigate its facial challenge in state court and was unsuccessful. Considerations of comity, 21 consistency, and efficiency support the application of collateral estoppel: plaintiff may not seek 22 a different result in this litigation.4 23 24 25 26 4 In the alternative, the Court finds that a four month period in which to evaluate all of the permitting issues that arise from a given project is not unreasonable. Plaintiff’s facial challenge fails as a matter of law and of fact. SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -6- 1 B. As Applied Challenge Plaintiff’s as-applied challenge is based on the fact that the City refused to make a 2 3 relatively simple dispersion determination for over six months, thereby suppressing plaintiff’s 4 protected speech for an extended and, in the circumstances presented here, unreasonable period 5 of time. The Court agrees. Even if one assumes that the City properly rejected plaintiff’s 6 building permit application in January 2009 because the application was not complete, once 7 plaintiff addressed the dispersion criteria, the application should have been accepted and ruled 8 upon in a timely fashion. By rejecting the application, the City effectively prevented a decision 9 on the merits, thereby barring plaintiff’s speech without ever evaluating the time, place, and 10 manner in which the speech would be offered. Having failed to conduct the required dispersion 11 analysis, the City had no basis for restraining plaintiff’s proposed speech .5 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 5 The City argues that plaintiff is responsible for much, if not all, of the delay in considering plaintiff’s building permit application. As recounted above, plaintiff submitted an application for a building permit in February 2009. Instead of identifying a deficiency or making a determination on the application, the City refused to accept the submission, thereby depriving plaintiff of both a decision and the normal land use appeal processes. It is not clear whether the City is arguing that (a) plaintiff should have submitted its application over and over again until it was accepted by DPD or (b) plaintiff should have enlisted the services of its attorney more quickly. An applicant should not have to repeatedly ask a municipality to follow its own ordinances, nor should it have to enlist the services of a lawyer or file a lawsuit in order to obtain a land use decision. The City’s attempt to impose such duties on plaintiff is unavailing. At oral argument, the City for the first time argued that its rejection of the February 2009 application was actually an acceptance, review, and denial of the permit application. There is no evidence to support this interpretation of the facts. The record shows that intake was told in midJanuary that the “[p]roject should not be accepted at intake without documentation regarding dispersion, or a written statement on the plans documented that this permit will not include approval of an adult cabaret.” Decl. of Robert Davis (Dkt. # 66), Ex. A at 7. Consistent with those instructions, the “[p]roposal was not taken in at intake” on January 23, 2009 and was “rejected” on February 9, 2009, because the applicant had not demonstrated on the dispersion site plan he provided that he met the dispersion requirements. Id. at 7-8. Neither the site plan provided by the applicant nor the DPD project summary indicates that a review of permitted uses was conducted at any time before that task was finally accomplished by Mr. McKim in August 2009. When plaintiff’s counsel contacted the City in July, she was not told that her client’s application had been denied. Rather, the City agreed to accept the application when offered the third time. Had the City actually made a determination on the merits of SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -7- The extent of the City’s unconstitutional delay in conducting a dispersion analysis 1 2 and whether that delay caused plaintiff compensable injury cannot be ascertained from the 3 current record. As the City points out, had it accepted and considered plaintiff’s building permit 4 application in February 2009, it would have had a reasonable period of time in which to consider 5 the application and it ultimately would have denied it for the same reasons it did so in September 6 2009.6 Whether any damages arose from the period of unreasonable delay has not been 7 adequately briefed by the parties. 8 II. INTERMEDIATE SCRUTINY 9 A government regulation aimed at sexual or pornographic speech is constitutional 10 if it (a) is not a complete ban on such speech, (b) is predominately concerned with ameliorating 11 the secondary effects of such speech on the community, and (c) passes intermediate scrutiny 12 (i.e., is narrowly tailored to serve a substantial governmental interest). Tollis Inc. v. County of 13 San Diego, 505 F.3d 935, 939 (9th Cir. 2007). Plaintiff argues that the version of SMC 14 23.47A.004.H that was in effect when it applied for a building permit did not pass constitutional 15 muster because it was not narrowly tailored to serve the government interest identified by the 16 City. In the process of developing land use regulations for adult cabarets, the City 17 18 identified a number of negative secondary effects associated with such establishments, including 19 litter, noise, traffic, inappropriate signage, declining property values, and potential hazards for 20 children and personal safety. See Decl. of Martha Lester (Dkt. # 21), Ex. A at 3-5. The City 21 opted to address these effects by preventing adult cabarets from crowding together in one area 22 and by ensuring a sizeable buffer between cabarets and any facility in which children are likely 23 24 plaintiff’s application in February 2009, the parties and the Court certainly should have and would have been informed of that fact at some point before oral argument was held in May 2011. 25 6 26 As of mid-January, the neighborhood had already identified the inconsistent uses that formed the basis of the denial six months later. Reply (Dkt. # 79) at 18. SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -8- 1 to congregate. This method of addressing the negative secondary effects of adult uses – through 2 dispersal – has been approved by the Supreme Court in a number of cases. See, e.g., City of 3 Renton v. Playtime Theatres, Inc., 475 U.S. 41 (1986). Plaintiff does not take issue with the 4 dispersion concept and implicitly agrees that the City has a substantial interest in separating 5 adult uses from each other and from places where children congregate. Plaintiff argues, 6 however, that former SMC 23.47A.004.H was too broad in that it prevented adult uses even 7 where surrounding facilities were not actually being used by children or other adult cabarets. 8 At the time plaintiff sought permission to remodel the building located at 10504 9 Aurora Avenue North, the City’s dispersion ordinance prevented any new or expanded adult 10 cabaret from operating within 800 feet of a “property containing any community center; child 11 care center; school, elementary or secondary; or public parks and open space use” or within 600 12 feet of a “property containing any other adult cabaret.” In order to determine whether a property 13 “contained” an incompatible use, DPD reviewed its permit files to determine what uses were 14 legally authorized at the surrounding properties. Plaintiff argues that, in order to satisfy the 15 “narrowly-tailored” prong of intermediate scrutiny, the City should have interpreted 16 “containing” to mean “actively engaged in” or “currently used as” lest plaintiff’s protected 17 speech be curtailed even when there was no incompatible use actually occurring in the area. 18 The Court finds that the City’s application of former SMC 23.47A.004.H was a 19 reasonable and measured effort to avoid the negative secondary effects associated with adult 20 uses. While the reach of the ordinance could have been limited in any number of ways (such as 21 by precluding new adult businesses within a smaller distance of an inconsistent use and/or only 22 where the inconsistent use is both permitted and currently operating), it could also have been 23 expanded to preclude adult uses near any facility serving children, including places like 24 children’s theaters, skate halls, and cinemas, and without regard to the permitting status of the 25 facility. The political branches of government are best suited to draw these lines: the judiciary 26 is tasked not with identifying the best way to advance the government’s interest, but with SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -9- 1 determining whether the scheme chosen by the City can withstand an intermediate level of 2 scrutiny. Given the nature of the government’s interest and the competing property interests at 3 stake, SMC 23.47A.004.H easily passes constitutional muster. Under the City’s zoning and land use scheme, a permit constitutes an on-going 4 5 authorization for a particular use without the need for further governmental approvals.7 Because 6 the child care facility and adult cabaret identified by DPD were legally permitted uses, allowing 7 plaintiff to open a new adult cabaret at the desired location posed the very real possibility that 8 the goals of the dispersion ordinance would be subverted. In fact, the previously-permitted adult 9 cabaret has since resumed operations. Had the City interpreted “containing” as “currently 10 operating,” there would now be two adult cabarets operating within 600 feet of each other, a 11 situation which the City Council clearly sought to avoid when it enacted former SMC 12 23.47A.004.H. On the flip side, consideration of “currently operating” facilities rather than 13 lawfully permitted facilities would give the reviewing government official considerable 14 discretion (and the surrounding neighborhood considerable power) to restrict First Amendment 15 speech. An unpermitted childcare facility or, as was the case near 10507 Aurora Avenue North, 16 an unpermitted school operating in the vicinity of a proposed adult cabaret could preclude a later 17 adult use even though the earlier operation was not sanctioned. The City’s interpretation of 18 SMC 23.47A.004.H, which has now been explicitly incorporated into the ordinance, is a 19 reasonable attempt to balance multiple competing interests. The Court finds that SMC 20 23.47A.004.H is narrowly-tailored to reduce the negative secondary effects of sexual or 21 pornographic speech on the community.8 22 23 24 25 26 7 In some instances an annual license may be needed to conduct a particular business, but that approval process is separate from the building and land use codes at issue in this litigation. 8 The Court finds plaintiff’s statutory construction arguments unpersuasive. The City’s interpretation of the word “containing” is reasonable in the context of SMC 23.47A.004.H, and the rule of in pari materia is inapplicable where, as here, the regulatory language differs in material respects. SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -10- 1 Finally, plaintiff asserts that the dispersion criteria are unconstitutionally vague 2 because “containing” is not defined in the ordinance. Vagueness challenges to undefined but 3 commonly understood terms are rarely successful. See Comite de Jornaleros de Redondo Beach 4 v. City of Redondo Beach, 607 F.3d 1178, 1194 (9th Cir. 2010); Gospel Missions of Am. v. City 5 of Los Angeles, 419 F.3d 1042, 1047-48 (9th Cir. 2005). Because we are “[c]ondemned to the 6 use of words, we can never expect mathematical certainty from our language.” Grayned v. City 7 of Rockford, 408 U.S. 104.110 (1972). In the context of the City’s building permit and land use 8 scheme, a person of ordinary intelligence would have fair notice that permitted uses, even if not 9 currently operating, would have to be taken into account when applying the dispersion criteria. 10 See Holder v. Humanitarian Law Project, __ U.S. __, 130 S. Ct. 2705, 2720 (2010) (in order to 11 withstand a vagueness challenge, the statute must provide “a person of ordinary intelligence fair 12 notice of what is prohibited.”) (quoting United States v. Williams, 553 U.S. 285, 304 (2008)). 13 Even if the word “containing” is taken out of its narrowing context so that it could be disputed 14 based on the temporal distinction drawn by plaintiff, the City has construed the ordinance in a 15 reasonable manner that avoids all subjective judgments. Plaintiff’s vagueness argument 16 therefore fails. CONCLUSION 17 18 For all of the foregoing reasons, plaintiff’s motion for partial summary judgment 19 (Dkt. # 68) and defendant’s cross-motion (Dkt. # 69) are GRANTED in part and DENIED in 20 part. The dispersion requirements of SMC 23.47A.004.H are constitutional on their face. The 21 ordinance was applied unconstitutionally, however, when the City refused to accept plaintiff’s 22 building permit application in February of 2009, thereby barring plaintiff’s protected speech 23 without evaluating the time, place, and manner in which that speech would be offered. Whether 24 this delay caused plaintiff any cognizable injury cannot be determined on the existing record. 25 26 SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -11- 1 Dated this 25th day of May, 2011. 2 3 A 4 Robert S. Lasnik United States District Judge 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 SECOND ORDER REGARDING CROSSMOTIONS FOR SUMMARY JUDGMENT -12-

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