Flanigan's Enterprises, Inc. v. Fulton County, Ga.

• Decision Date: 16 February 2010
• Docket Number: No. 08-17035.,08-17035.
• Citation: 596 F.3d 1265
• Parties: FLANIGAN'S ENTERPRISES, INC. OF GEORGIA, a Georgia corporation d.b.a. Mardi Gras, 6420 Roswell Rd., Inc., a Georgia corporation d.b.a. Flashers, et al., Plaintiffs-Appellees-Cross Appellants, v. FULTON COUNTY, GA., Defendant-Appellant-Cross Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

596 F.3d 1265

FLANIGAN'S ENTERPRISES, INC. OF GEORGIA, a Georgia corporation d.b.a. Mardi Gras, 6420 Roswell Rd., Inc., a Georgia corporation d.b.a. Flashers, et al., Plaintiffs-Appellees-Cross Appellants, v. FULTON COUNTY, GA., Defendant-Appellant-Cross Appellee.

No. 08-17035.

United States Court of Appeals, Eleventh Circuit.

February 16, 2010.

Vincent D. Hyman, Kaye Woodard Burwell, Steven E. Rosenberg, William Shannon Sams, Atlanta, GA, for Plaintiffs-Appellees-Cross Appellants.

Cary Stephen Wiggins, Irma I. Espino, Cook, Youngelson & Wiggins, Atlanta, GA, James N. Cline, Toswell, GA, for Plaintiffs-Appellees-Cross Appellants.

Appeals from the United States District Court for the Northern District of Georgia.

Before BLACK, MARCUS and HIGGINBOTHAM,^* Circuit Judges.

MARCUS, Circuit Judge:

Defendant Fulton County, Georgia, concerned about the secondary effects on its communities of the mixture of alcohol and live nude dancing, passed an ordinance in 2001 prohibiting the sale, possession, and consumption of alcohol in adult entertainment establishments. Plaintiffs Flanigan's Enterprises, Inc., owner and operator of the Mardi Gras strip club, and other owners and operators of strip clubs in Fulton County brought this First Amendment challenge to the ordinance, arguing that the ordinance infringed on their right to free speech. The district court, concluding that the ordinance failed to further an important governmental interest, granted summary judgment and awarded damages to Flanigan's. The County now appeals the judgment and Flanigan's cross-appeals on several issues not reached by the district court.

This is the second time that we have been asked to consider a First Amendment challenge to a Fulton County ordinance proscribing the sale of alcohol at adult clubs. The County had passed a similar ordinance in 1997, but this Court struck it down, reasoning that the County had ignored the most relevant evidence in enacting the regulation. See Flanigan's Enters., Inc. of Ga. v. Fulton County, Ga., 242 F.3d 976, 986 (11th Cir.2001). This case is different. This time around, the County relied on ample statistical, surveillance, and anecdotal evidence, the live testimony of the chief of police and the chief judge of the juvenile court, among others, and dozens of foreign studies, all of which support the County's efforts to curb the negative secondary effects of alcohol and live nude dancing in its communities. We are satisfied that the County's reliance on this factual foundation was reasonable, and because we determine that the ordinance furthers an important governmental interest, we reverse.

I.

A.

The essential facts presented in this summary judgment record are these: the plaintiffs in this consolidated action—Flanigan's Enterprises, Inc. ("Flanigan's"); 6420 Roswell Road, Inc. ("Roswell"); Harry Freese; Fannies, Inc.; William H. Parks, Jr.; and Ceeda Enterprises, Inc. ("Ceeda") (collectively, "the clubs")—are owners and operators of strip clubs in Fulton County, Georgia. The clubs they operate include Mardi Gras, Flashers, Fannies, and Riley's Restaurant and Lounge ("Riley's"). These clubs sell and serve alcohol, and feature live nude dancing on the premises.

In 1997, Fulton County began to investigate the impact of strip clubs within its borders on crime and property values in the surrounding communities. The County board of commissioners directed the police department to study the issue, which the department did. The resulting police investigation, which considered two and a half years of statistical data, revealed no relationship between alcohol, nude dancing, and crime. In fact, the report suggested that crime was a greater problem in and around bars which did not feature live nude dancing. In response to the County's investigation, the strip clubs commissioned a study of their own, which revealed that there was no relationship between the strip clubs and reduced property values in Fulton County.

The County's investigation continued. It, too, commissioned a study on property values in the area, which confirmed the finding of the clubs' study—that the clubs had no impact on the property values in the surrounding areas. The County also directed its staff to collect a number of studies on the impact of strip clubs in other American cities. These so-called foreign studies, which considered the impact of clubs in Austin, Indianapolis, Minneapolis, and Los Angeles, concluded that strip clubs were indeed a blight on the surrounding communities.

The County held two public meetings to review the results of its investigation. Despite the three local and recent studies indicating no relationship between the clubs, crime, or reduced property values, the County relied on the foreign studies indicating a correlation. As a result, on December 17, 1997, the board of commissioners passed an ordinance forbidding the service and consumption of alcohol in facilities featuring adult entertainment.

The strip clubs sued, and a panel of this Court determined that the ordinance violated the First Amendment of the U.S. Constitution. Relying on United States v. O'Brien, 391 U.S. 367, 88 S.Ct. 1673, 20 L.Ed.2d 672 (1968), the Court observed that the County was "not required to perform empirical studies," but, "having done so, the Board [could not] ignore the results." Flanigan's Enters., Inc. of Ga. v. Fulton County, Ga., 242 F.3d 976, 986 (11th Cir.2001) (internal citation omitted).

After this Court struck down the first ordinance, the board commissioned two more studies. The first of these studies, called "Adult and Non-Adult Entertainment Establishments Statist[i]cal Analysis From 1/1/98 To 12/31/00," conducted by the Fulton County police department, and completed in March 2001 ("March 2001 report" or "Adult and Non-Adult Entertainment Establishments Statistical Analysis"), reviewed police data from January 1998 to December 2000. It found "that adult entertainment establishment[s which] served alcoholic beverages did not have a significant impact on the police department as it relates to an increase in calls for police service, nor an increase in crime as a secondary [e]ffect." Moreover, the March 2001 report concluded that bars without nude dancing had higher crime rates than those bars with nude dancing.

The second of the studies commissioned by the County was completed in July 2001 ("July 2001 report"), made a variety of findings, and reached a different result. Titled "Report on Fulton County Adult Entertainment Businesses," it described "Operation Summit Up," a fourteen-day sweep conducted by the Fulton County police department in September 1998. The sting operation, which focused on an industrial area in which the strip clubs Fannies, Riley's and Babes were located, resulted in 167 arrests and 166 convictions. Of the 221 total charges filed, ninety-three were for prostitution and other sex-related crimes, and thirty-four were for drug-related crimes.

The report featured photographic evidence chronicling the same industrial area, and stated that the area was marked by dilapidated buildings, streets in disrepair, and cheap hotels catering to prostitutes and johns. An affidavit from Patrick Stafford, executive director of the Fulton Industrial Business Association, further described the hotels, stating that "[t]hey rent locally, engage in cash transactions with customers, and rent hourly or for portions of days," and that their exteriors are characterized by "out-of-code parking lots, lack of lighting in parking lots, lack of security in parking lots, pandering and general unsafe conditions."

Notably, the July 2001 report contained an extensive discussion of South Fulton Precinct beats 21 and 23, and, in particular, a one square-mile of land within them called grid B43. Grid B43 contains three of the nude clubs, Fannies, Riley's, and Babes. The report stated that, from 1998 to 2000, beats 21 and 23 accounted for a disproportionately high amount of crime within the South Fulton Precinct, and that grid B43 contributed to more than its fair share of crime within those two beats. The report noted that beats 21 and 23 saw an increase in crime during the evening hours, even though most businesses in the area operated during standard business hours. The report also compared incident data from six strip clubs, five of which served alcohol and one of which did not (but allowed customers to bring their own) ("the BYOB club"). It showed that, from 1998 to 2000, the BYOB club accounted for only fifteen of the 362 reported incidents, or 4.1%.

The report described in great detail the results of surveillance operations conducted by the Fulton County police during May and June of 2001. The surveillance conducted at the adult clubs which served alcohol revealed a number of criminal violations and arrests.¹ The report states, however, that no violations were observed, and no arrests were made, at the BYOB club.

The report also presented what it described as anecdotal evidence. An affidavit from the Honorable Nina R. Hickson, presiding judge for the Juvenile Court of Fulton County, described how some of the girls who had appeared before her in her two years as presiding judge had worked in the adult clubs and had performed sexual acts in their parking lots. Some of these girls got work at private parties, where they performed sexual acts. Judge Hickson also reported her "belief that adult entertainment clubs are a burden on the juvenile justice system." The July 2001 report also contained excerpts from a number of newspaper articles from 1998 to 2001 describing the strip clubs and their negative impact on the community. The articles discuss the clubs, crime, child prostitution, and the prosecution at the Gold Club, an area club of ill repute now closed.

Appended to the July 2001 report were a number of foreign studies, which considered data from and the experiences of a variety of American cities. In particular, the July...