8100 North Freeway Ltd. v. City of Houston

• Decision Date: 02 December 2010
• Docket Number: No. 14-09-00220-CV.,14-09-00220-CV.
• Citation: 329 S.W.3d 858
• Parties: 8100 NORTH FREEWAY LTD., Appellant, v. CITY OF HOUSTON, Appellee.
• Court: Texas Court of Appeals

329 S.W.3d 858

8100 NORTH FREEWAY LTD., Appellant,

v.CITY OF HOUSTON, Appellee.

No. 14-09-00220-CV.

Court of Appeals of Texas,

Houston (14th Dist.).

Dec. 2, 2010.

Richard B. Kuniansky, Houston, Bradley J. Reich, Aurora, for appellant.

Lisa A. Brown, Nirja S. Aiyer, Patrick Zummo, Houston, for appellee.

Panel consists of Chief Justice HEDGES and Justices YATES and SULLIVAN.

OPINION

LESLIE B. YATES, Justice.

Appellant 8100 North Freeway Ltd. appeals the trial court's order granting the temporary injunction request of appellee the City of Houston. Because we find that the trial court did not abuse its discretion in issuing the temporary injunction, we affirm.

BACKGROUND

The City regulates sexually oriented businesses (SOBs) and requires them to meet certain criteria to obtain permits, which are necessary for legal operation. 8100 operates a business, originally called Adult Video Megaplexxx, consisting of an adult bookstore and adult arcade that features small booths with doors where adults may privately view sexually explicit videos. A portion of the City's SOB ordinance specifically regulates adult arcades and requires, among other things, minimal lighting levels inside the booths and a direct line of sight between the manager and the booth patron. These requirements were enacted to discourage sexual activity in arcade booths. See Rosenblatt v. City of Hous., 31 S.W.3d 399, 404 (Tex.App.-Corpus Christi 2000, pet. denied). Megaplexxx attempted to comply with the ordinance by installing video cameras in the booths. See id. at 402. The City denied Megaplexxx a permit because it did not comply with the direct line of sight provision, and the City's action was upheld in the trial court and on appeal. See id. at 401.

Megaplexxx then changed its business model in an attempt to avoid being subject to the ordinance. It changed its name to Tryst, A Lover's Boutique, and began offering several new types of inventory, including condoms, oils, lingerie, costumes, and adult novelties. 8100 expanded the video arcade from nine to twenty-eight viewing rooms and added more viewing channels, for a total of sixty-three channels showing various types of adult videos and sixty-four channels offering mainstream movies. By making these changes, 8100 attempted to cast itself as a "fifty/fifty" business rather than an adult arcade requiring a permit.

A Houston Police Department officer inspected the premises. He observed a sign on the front door prohibiting minors. Inside, signage directed patrons to the arcade area, touting "hardcore" channels. The arcade area spanned three hallways, and all arcade booths had closable doors. A television hanging from the ceiling above the entrance to the arcade area continuously displayed videos depicting explicit sexual activity. Inside a booth, the officer observed a money-operated arcade device that displayed videos depicting explicit sexual activity, along with a chair, paper towels, and a trashcan.

The City brought suit against 8100 for operating an adult arcade without a permit and sought injunctive relief. The trial court granted the City's request for a temporary injunction on March 5, 2009, and ordered that the arcade area be locked and that 8100 cease from operating its arcade devices. 8100 filed its appeal the same day, but to date, no permanent injunction hearing has been held.

ANALYSIS

A. Legal Standards

The purpose of a temporary injunction is to preserve the status quo pending a trial on the merits. Butnaru v. Ford Motor Co., 84 S.W.3d 198, 204 (Tex.2002); EMS USA, Inc. v. Shary, 309 S.W.3d 653, 657 (Tex.App.-Houston [14th Dist.] 2010, no pet.). Generally, to obtain a temporary injunction, the applicant must prove a valid cause of action against the defendant, a probable right to relief, and imminent, irreparable injury in the interim. See Butnaru, 84 S.W.3d at 204; EMS, 309 S.W.3d at 657. However, when the applicant has shown a violation of a statute that authorizes injunctive relief, it need not prove imminent, irreparable injury. See Butnaru, 84 S.W.3d at 210; West v. State, 212 S.W.3d 513, 518-19 (Tex.App.-Austin 2006, no pet.); Ralph Williams Gulfgate Chrysler Plymouth, Inc. v. State, 466 S.W.2d 639, 642 (Tex.Civ.App.-Houston [14th Dist.] 1971, writ ref'd n.r.e.). Further, the applicant need not prove that it will prevail, and the merits of the suit are not issues for appellate review. See EMS, 309 S.W.3d at 658. Rather, we review the trial court's decision on a temporary injunction request for an abuse of discretion. Butnaru, 84 S.W.3d at 204; EMS, 309 S.W.3d at 658. We must not substitute our judgment for the trial court's judgment and may not reverse unless the trial court's action was so arbitrary that it exceeded the bounds of reasonableness. See Butnaru, 84 S.W.3d at 204.

B. The Primary Business Standard Does Not Apply

In its first issue, 8100 argues that the trial court erred in granting a temporary injunction because the SOB ordinance regarding adult arcades applies only to entities whose primary business is to provide sexual stimulation or gratification and, because its inventory of movies is over fifty percent non-adult, its primary arcade business is not sexual.

Local Government Code chapter 243, entitled "Municipal and County Authority to Regulate Sexually Oriented Business," defines a sexually oriented business as follows:

[A] sex parlor, nude studio, modeling studio, love parlor, adult bookstore, adult movie theater, adult video arcade, adult movie arcade, adult video store, adult motel, or other commercial enterprise the primary business of which is the offering of a service or the selling, renting, or exhibiting of devices or any other items intended to provide sexual stimulation or sexual gratification to the customer.

Tex. Loc. Gov't Code Ann.. § 243.002 (West 2005). The City has regulations regarding SOBs in two portions of chapter 28 of the City of Houston Code of Ordinances: article II, which governs adult arcades and adult mini-theaters, and article III, which governs SOBs generally. Houston, Tex., Rev. Ordinances ch. 28, arts. II, III (1997). Article II defines an adult arcade as "any premises that is subject to regulation under Chapter 243 of the Local Government Code, as amended, to which members of the public ... are permitted to use one or more arcade devices." Id. art. II, § 28-81. An "arcade device" is "any coin- or slug-operated or electronically or mechanically controlled machine or device that dispenses or effectuates the dispensing of entertainment, that is intended for the viewing of five or fewer persons in exchange for any payment of consideration," and "entertainment" includes "[a]ny still picture(s) or movie picture(s)." Id.

8100 contends that because article II's definition of adult arcade refers back to chapter 243 and chapter 243's definition of SOB includes the notion of primary business, it is subject to article II's regulation only if its primary business is to provide sexual stimulation or gratification. We disagree. Chapter 243's definition contains a list of establishments that are categorically considered SOBs and then contains a catch-all for other businesses not listed but whose primary business is providing sexual stimulation or gratification. See Meijas v. State, No. 04-01-00048-CR, 2002 WL 112534, at *1 (Tex.App.-San Antonio Jan. 30, 2002, pet. ref'd) (not designated for publication); see also N.W. Enters. Inc. v. City of Hous., 352 F.3d 162, 184 (5th Cir.2003); Laredo Road Co. v. Maverick Cnty., 389 F.Supp.2d 729, 734-35 (W.D.Tex.2005). An adult video arcade is in the list of categorical SOBs, and thus the primary business analysis is irrelevant. See Meijas, 2002 WL 112534, at *1. 8100 insists that the primary business language in chapter 243 modifies not just the catch-all "other commercial enterprise" but also the entire list of enumerated businesses. However, such an interpretation is grammatically incorrect.¹ Under the last antecedent rule, a limiting clause or phrase should ordinarily be read as modifying only the noun or phrase that it immediately follows. See Barhnart v. Thomas, 540 U.S. 20, 26, 124 S.Ct. 376, 157 L.Ed.2d 333 (2003); Laredo Road, 389 F.Supp.2d at 735; Rowan Cos. v. Wilmington Trust Co., 305 S.W.3d 698, 710-11 (Tex.App.-Houston [14th Dist.] 2009, pet. filed). Had the legislature intended the primary business phrase to modify the entire list rather than only the last item, it would likely have included a comma between "other commercial enterprise" and "the primary business of which." See Elliot Coal Mining Co. v. Office of Workers' Comp. Programs, 17 F.3d 616, 629-30 (3d Cir.1994); Bingham, Ltd. v. United States, 724 F.2d 921, 925 n. 3 (11th Cir.1984); Meijas, 2002 WL 112534, at *1.

The trial court found in its temporary injunction order that 8100 is operating an adult arcade without a permit as required by article II. 8100 does not dispute that Tryst has arcade devices that are open to the public for a fee, that they display both pornographic and non-pornographic movies, and that Tryst does not have an article II permit. We conclude the trial court did not abuse it discretion in granting a temporary injunction on this basis. Tryst's primary business is not relevant to this inquiry, and we overrule 8100's first issue.²

C. Injunctive Relief Was Proper

8100 raises several issues regarding the propriety of injunctive relief in this case. In its fifth issue, 8100 asserts that the trial court abused its discretion in issuing the injunction because the ordinance does not authorize injunctive relief for a violation of article II. Article III of the SOB ordinance specifically states that "[t]he city attorney is hereby authorized to file suit to enjoin the violation of this article." Houston, Tex., Rev. Ordinances ch. 28, art. III, § 28-134. Article II, however, is silent on the issue of authority to pursue an injunction. Based on this, 8100 argues that the City is not authorized to seek an injunction for violation of ...