B&S of Fort Wayne, Inc. v. City of Fort Wayne
| Decision Date | 29 October 2020 |
| Docket Number | Court of Appeals Case No. 20A-MI-466 |
| Citation | 159 N.E.3d 67 |
| Parties | B&S OF FORT WAYNE, INC., d/b/a Showgirl I; Showgirl III, Inc., d/b/a Showgirl III ; and JCF, Inc., d/b/a Brandy's Lounge, Appellants-Plaintiffs, v. CITY OF FORT WAYNE, Indiana, Appellee-Defendant. |
| Court | Indiana Appellate Court |
Attorneys for Appellants: J. Michael Murray, Steven D. Shafron, William C. Livingston, Berkman, Gordon, Murray & DeVan, Cleveland, Ohio, James P. Buchholz, Angelica N. Fuelling, Tourkow, Crell, Rosenblatt & Johnson, LLP, Fort Wayne, Indiana
Attorneys for Appellee: Robert W. Eherenman, Haller & Colvin, P.C., Fort Wayne, Indiana, Scott D. Bergthold, Law Office of Scott D. Bergthold, Chattanooga, Tennessee
[1] In August of 2019, the City of Fort Wayne ("the City") passed an ordinance, Fort Wayne Ordinance No. G-19-19 ("the ordinance"), which regulates "sexually oriented businesses," including "adult cabarets." Appellants' App. Vol. 2 at 47. B&S of Fort Wayne, Inc., d/b/a Showgirl I; Showgirl III, Inc., d/b/a Showgirl III; and JCF, Inc., d/b/a Brandy's Lounge (collectively "the Nightclubs") own adult cabarets located in Ft. Wayne. In September of 2019, the Nightclubs filed a complaint seeking a preliminary injunction, a permanent injunction, and a declaratory judgment. In particular, the Nightclubs alleged that the ordinance violated their constitutional rights to free speech and posed "irreparable harm" to them if it were enforced. Id. at 96. In response, the City filed a counterclaim seeking its own preliminary injunction to enforce the ordinance and a declaratory judgment that the ordinance was constitutional. Following a hearing on the motions, the trial court denied the Nightclubs' motion for a preliminary injunction and granted the City's motion for a preliminary injunction.
[2] The Nightclubs appeal the trial court's order denying their motion for a preliminary injunction. The Nightclubs present three dispositive issues for our review:
[3] We affirm.
[4] The Nightclubs own and operate adult cabarets in Ft. Wayne ("the cabarets"), which serve alcohol to customers who come to watch partially-nude dancers perform. In addition to performances on a stage, dancers perform for customers table-side, and they perform lap dances for customers in "semi-private" areas separate from the main stage area. Id. at 50. Whether dancers are performing on stage, at a table, or in the lap dance area, they frequently make direct physical contact with customers.
[5] On August 13, 2019, the Ft. Wayne City Council adopted the ordinance, which was intended to "protect and preserve the health, safety, and welfare" of both patrons of sexually oriented businesses and "citizens of the City[.]" Ex. 1 at 1. The ordinance provides in relevant part as follows:
Ex. 1 at 21-22 (emphasis added).
[6] In their complaint seeking a preliminary injunction, the Nightclubs first alleged that the ordinance "runs afoul of [ Indiana Code Section] 7.1-3-9-6," which prohibits a city from enacting an ordinance "which in any way, directly or indirectly, regulates, restricts, enlarges, or limits the operation or business of the holder of a liquor retailer's permit[.]" Appellants' App. Vol. 2 at 87. In particular, the Nightclubs asserted that the ordinance "impermissibly regulates, restricts and limits the operation" of their businesses in several ways in violation of the statute, including: requiring the Nightclubs "to undertake extensive and costly remodeling of their permit premises" to satisfy the six-foot spacing requirement; "diminish[ing] the number of patrons that their businesses can accommodate and thus reduce the audience"; and requiring "that an Operator of the business be present in the same room whenever a semi-nude performance is taking place." Id. at 87-88.
[7] The Nightclubs also alleged that the ordinance is preempted by Indiana Code Section 36-1-3-8(a)(7), which provides that a city does not have the power under the Home Rule Act "to regulate conduct that is regulated by a state agency, except as expressly granted by statute." In particular, the Nightclubs averred that, because the Alcohol and Tobacco Commission "has chosen to regulate adult entertainment in alcohol permit premises, ... the City lacks the authority to do so." Appellants' App. Vol 2 at 89. Finally, the Nightclubs alleged that the ordinance violates various rights they have under the federal and state constitutions. In its counterclaim, the City sought a preliminary injunction and a permanent injunction "to prevent and to punish certain unlawful acts contrary to" the ordinance. Id. at 139.
[8] Following a hearing on the complaint and counterclaim, the trial court denied the Nightclubs' request for a preliminary injunction and granted the City's request for a preliminary injunction. In its order, the trial court made thorough findings and conclusions, including in pertinent part, the following:
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