Capital Area Right to Life, Inc. v. Downtown Frankfort, Inc.

• Decision Date: 01 July 1993
• Docket Number: No. 92-SC-347-DG,92-SC-347-DG
• Parties: CAPITAL AREA RIGHT TO LIFE, INC., Movant, v. DOWNTOWN FRANKFORT, INC.; John Gray, Individually and John Gray as President of Downtown Frankfort, Inc., Respondents.
• Court: United States State Supreme Court — District of Kentucky

Page 297

862 S.W.2d 297

62 USLW 2038

CAPITAL AREA RIGHT TO LIFE, INC., Movant, v. DOWNTOWN FRANKFORT, INC.; John Gray, Individually and John Gray as President of Downtown Frankfort, Inc., Respondents.

No. 92-SC-347-DG.

Supreme Court of Kentucky.

July 1, 1993.

Rehearing Denied Oct. 28, 1993.

Phyllis A. Sower, Frankfort, Walter M. Weber, Free Speech Advocates, New Hope, Alice W. Hobson, Frankfort, for Movant.

John H. Gray, Frankfort, for Respondents.

LEIBSON, Justice.

The respondent, Downtown Frankfort, Inc. (DFI) is a non-profit corporation established to promote downtown revitalization in Frankfort, Kentucky. John Gray is its president. As one of its activities, DFI organized and sponsored a "Great Pumpkin Festival" as a special event to be held on the city's St. Clair Mall, on Saturday, October 27, 1990.

Capital Area Right To Life, Inc. (CARTL) had a booth at the 1989 Festival, but was denied a permit to have a booth at the 1990 Festival, being advised by letter from President John Gray that DFI had decided upon a "policy on the issue of festival participation" under which "theme festivals, events, and booths are meant to be for fun and entertainment, [and] DFI reserves the right to deny participation to any displayer/merchandiser deemed inappropriate to that theme and purpose." Additionally, Gray advised CARTL orally that it could not have a booth because it was a "controversial group." This 1990 festival policy evolved because, at the 1989 Festival, DFI had received complaints from many festival-goers, as well as other festival participants, about the inappropriateness of advocacy groups such as CARTL participating in a family-oriented Halloween/Fall Festival. At oral argument both sides took note that, at the 1989 Festival, CARTL's booth had distributed plastic models of fetuses in little baskets.

The record shows that DFI's 1990 festival policy was applied evenhandedly in that CARTL's counterparts, Kentucky NOW and the Kentucky Religious Coalition for Abortion Rights, were also denied participation as not in keeping with the Halloween/Fall Harvest theme of the "Great Pumpkin Festival."

CARTL filed suit in Franklin Circuit Court against DFI and Gray alleging "the actions of the Defendants jointly and severally deprived the Plaintiff of its rights under the First and Fourteenth Amendments to the United States Constitution (more specifically, abridging the freedom of speech), unlawfully restricts the use of public property and denies to the Plaintiff equal access to a public forum." CARTL sought relief under the Kentucky Declaratory Judgments Act (KRS Chapter 418) and the Federal Civil Rights Act (Title 42, U.S.Code, Sec. 1983).

The trial court denied the injunction and entered summary judgment for the defendants, Gray and DFI. The Kentucky Court of Appeals panel affirmed; one judge dissented. Because the case involves freedom of speech, a constitutional issue of great public importance, we granted discretionary review. For reasons to be stated, we affirm.

The evidence in this case consists solely of affidavits filed on behalf of the parties concerned. These affidavits are not in conflict on any facts material to deciding this controversy. Thus, while we differ with the trial court and the Court of Appeals about the reasons for deciding DFI's actions did not violate CARTL's constitutional rights, we agree this was a proper case for summary judgment.

On appeal, CARTL addressed, for the first time, freedom of speech provisions in our Kentucky Constitution (Ky. Const., Sec. 1(4) and Sec. 8), in addition to the federal constitutional law arguments CARTL presented at the trial level. We will not undertake to decide whether the right to frame arguments based on the Kentucky Constitution has been lost by procedural default, because CARTL offers no differences between the two constitutions pertinent to the issues in this case.

This case was decided in the trial court and in the Court of Appeals on grounds that DFI and Gray are private parties, not public entities, and that the Fourteenth Amendment, and through it First Amendment rights, do not apply to private parties unless those parties are engaged in activity deemed to be "state action." Jackson v. Metropolitan Ed. Co., 419 U.S. 345, 95 S.Ct. 449, 42 L.Ed.2d 477 (1974). Having stated the issue in the simplest of terms, the application of the principle became exceedingly complicated. Both courts below engaged in labored analysis of various factors and tests applied to decide the "state action" question in a multiplicity of decisions (most of them unrelated to abridging or restricting free speech), ultimately deciding that DFI and Gray were not state actors when they denied CARTL a permit to operate a booth at the festival.

The trial court analyzed the case using three tests: the "public function test," which asks whether private actors are "performing functions traditionally the exclusive prerogative of the city"; the "state compulsion test," which asks whether "the city has exercised coersive [sic.] power or has provided such significant encouragement, either overt or covert, that choice must in law be deemed to be that of the city"; and the "nexus test" which asks whether the city and DFI were "intertwined in a 'symbiotic relationship' " such that they were "joint participants." The trial court concluded:

"Applying the three tests to the facts at hand it becomes apparent that DFI was not performing a city function. It follows that the plaintiff was denied no constitutional right."

The Court of Appeals took the inquiry one step further, addressing the question posed in Lugar v. Edmondson Oil Co., 457 U.S. 922, 939, 102 S.Ct. 2744, 2755, 73 L.Ed.2d 482, 497 (1982):

"Whether these different tests are actually different in operation or simply different ways of characterizing the necessarily fact-bound inquiry that confronts the Court in such a situation.... 'Only by sifting facts and weighing circumstances can the nonobvious involvement of the State in private conduct be attributed its true significance.' "

After separately analyzing the factors and tests applied in many different cases, the Court of Appeals concluded:

"From all the foregoing we have observed that every case must be examined from the facts of each situation; that the receipt of state funds does not convert private actors to state actors; and that in the case at bench the government is not in the business of conducting festivals. Neither can it be said that there was any duty, legal or otherwise, for the city or county to promote or revitalize downtown Frankfort or, for that matter, any other area within their respective boundaries.... CARTL has failed in establishing that DFI was performing a public function."

The Court of Appeals reached its decision by separately analyzing each reason proffered for attaching the "state action" label to DFI's activities, and then rejecting each in turn on the basis DFI's activities did not prove state action. The Dissenting Opinion by Judge Huddleston reached the opposite conclusion by considering DFI's activities in the aggregate. Judge Huddleston conceded that "examined separately and in light of existing United States Supreme Court decisions these factors do not individually represent a significant degree of state action," but concluded "as the Supreme Court has stated, 'the dispositive question in any state-action case is not whether any single fact or relationship presents a sufficient degree of state involvement, but rather whether the aggregate of all relevant factors compels a finding of state responsibility.' Burton v. Wilmington Parking Authority, 365 U.S. 715, 722, 81 S.Ct. 856 , 6 L.Ed.2d 45, 50 (1961)." We agree with the Court of Appeals' Dissenting Opinion that "[u]pon weighing the circumstances of this case" in the "aggregate," DFI qualifies as a state actor.

There are many factors that point to this conclusion. DFI is incorporated as a private, non-profit corporation, but its purpose is to bring about "revitalization" of Downtown Frankfort. This is a function it took over from the city to the extent of carrying out the "Main Street Program," which is operated under the patronage and guidance of the Kentucky Heritage Council, an agency of state government under the Education and Humanities Cabinet. KRS 171.3801 and 171.381. DFI's principal funding is from monies received from the Kentucky Heritage Council, from the City of Frankfort, and from the Franklin County Fiscal Court, although it also charges dues to its members and presumably accepts private contributions.

One of the functions of the Kentucky Heritage Council is the "administration" of a "grants program" which includes the "Main Street Program," the impetus behind the "Great Pumpkin Festival." The unrefuted affidavit from John R. Sower, formerly Mayor of the City of Frankfort from 1978-82, filed on behalf of CARTL states:

"Downtown Frankfort, Inc., has in fact taken over a function formerly performed by the City of Frankfort. The City used to hire its own staff to promote the revitalization of downtown as a place to live, visit, shop, invest, etc. During the affiant's term as Mayor, the City received a 'Main Street' program fund for this purpose and hired Randy Shipp and Todd Graham to promote downtown Frankfort."

Finally, and of great significance, the St. Clair Mall upon which this festival is conducted is a public area, but a permit for a booth on this public area must be obtained from DFI: "no formal city permit is issued." Thus the city has delegated to DFI control over the St. Clair Mall, albeit only to the limited extent of deciding who shall be permitted to maintain booths there during the hours of the festival.

These factors leave no room to doubt that the activities engaged in by DFI in conducting the "Great Pumpkin Festival," in the aggregate, constitute state action.

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