Clark v. City of Fremont, Nebraska

• Decision Date: 12 April 1974
• Docket Number: No. CV73-L-263.,CV73-L-263.
• Citation: 377 F. Supp. 327
• Parties: Patsy A. CLARK, d/b/a the Lariat Club, Plaintiff, v. The CITY OF FREMONT, NEBRASKA, a municipal corporation, and Arthur L. Peters, Defendants.
• Court: U.S. District Court — District of Nebraska

377 F. Supp. 327

Patsy A. CLARK, d/b/a the Lariat Club, Plaintiff, v. The CITY OF FREMONT, NEBRASKA, a municipal corporation, and Arthur L. Peters, Defendants.

No. CV73-L-263.

United States District Court, D. Nebraska.

April 12, 1974.

William G. Line, Kerrigan, Line & Martin, Fremont, Neb., for plaintiff.

Lyle B. Gill, City Atty., Fremont, Neb., for defendants.

MEMORANDUM OF DECISION

BENSON, Chief Judge.

On September 11, 1973, Defendant City of Fremont, passed Ordinance No. 2768:

"AN ORDINANCE OF THE CITY OF FREMONT, NEBRASKA, TO AMEND CHAPTER 3, ALCOHOLIC BEVERAGES, OF THE MUNICIPAL CODE, BY THE ADDITION OF SECTION 3-17 TO PROVIDE GROUNDS FOR REVOCATION AND SUSPENSION OF RETAIL LICENSES, TO PROVIDE FOR NOTIFICATION AND HEARING, AND TO PROVIDE FOR AN EFFECTIVE DATE.

BE IT ORDAINED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF FREMONT, NEBRASKA:

SECTION I. That Chapter 3, Alcoholic Beverages, of the Municipal Code be amended by the addition of Section 3-17 which shall read as follows:

Section 3-17. Grounds for Revocation or Suspension. A retail license to sell or dispense alcoholic liquors, which this Council is legally empowered to revoke, may be either revoked or suspended by the City Council whenever it shall find, after notice and hearing as provided by law, that the holder of any such license has violated any of the provisions of said Nebraska Control Act, or of this chapter, or rule or regulation of the Nebraska Liquor Control Commission, or any statutory provision or ordinance of the City now existing or hereafter passed, enacted in the interest of good morals and decency, or for any one or more of the following causes:

1. The licensee, his manager or agent in charge of the premises licensed, has been convicted of or has plead guilty to a felony under the laws of the State of Nebraska, or of any other state of the United States.

2. The licensee, his manager or agent in charge of the premises licensed, has been convicted of or has plead guilty to being the proprietor, manager or agent in charge of a gambling house, or of pandering or other crime or misdemeanor opposed to decency and morality.

3. The licensee, his manager or agent in charge of the premises licensed, has been convicted of or plead guilty to violation of any federal or state law concerning the manufacture, possession or sale of alcoholic liquors.

4. The licensee either swore falsely to any question in his application for said license or has failed to comply with the statements and representations made by the answer to any question or questions in said application, or has failed to perform in accordance with any other statement or representation or keep any promise, oral or written, made to the Council, in connection with such licensee's request for said license.

5. The licensee, his manager or agent in charge of the premises licensed, shall have forfeited bond to appear in court to answer charges for any one of the violations of law or ordinance referred to in this section.

6. It shall be the cause for revocation or suspension as herein provided if the licensee, his manager or agent, shall allow any live person to appear, or have reasonable cause to believe that any live person shall appear in any licensed premises in a state of nudity, to provide entertainment, to provide service, to act as hostess, manager or owner, or to serve as any employee in any capacity.

For the purpose of this section, the term `nudity' shall mean the showing of the human male or female genitals, pubic area or buttocks with less than a full opaque covering. Furthermore, the term `nudity' shall mean the showing of that area of the human female breast from one inch above the breast nipple, the breast nipple, and that portion of the breast four inches below the breast nipple with less than a full opaque covering. In no event shall a female covered by this Section appear without a brassiere or halter, opaque, covering at least four inches of the nipple area of her breasts.

7. Upon a signed formal complaint of an alleged violation of this ordinance filed with the City Clerk of the City of Fremont, Nebraska, the Mayor and City Council of the City of Fremont will conduct a hearing on the matter at its next regular meeting, provided that the complaint is filed within ten days prior to said meeting, otherwise the matter will be held over until the following regular Council Meeting. It shall be the duty of the City Clerk of the City of Fremont, Nebraska, to notify the retail liquor license holder, by United States mail, postage prepaid, of said alleged violation and hearing date.

SECTION II. That all of Chapter 3, Alcoholic Beverages of the Municipal Code of the City of Fremont, Nebraska, except as heretofore amended, is to remain in full force and effect.

SECTION III. That this ordinance shall be in full force and effect from and after its passage, approval and publication as provided by law."

Defendant, Arthur L. Peters, is the Mayor of Fremont, and as such is invested with the superintending control of all officers and affairs of the City. Plaintiff, Patsy Clark, is a holder of a Class C license to sell alcoholic liquor by the drink issued by the Nebraska Liquor Control Commission to her as an individual doing business as the Lariat Club. Entertainment at the club includes topless dancing, and other acts, which fall within the ordinance's proscriptions. Plaintiff challenges the constitutional validity of Ordinance No. 2678, contending that certain language contained in the first paragraph of Section 3-17, and subsections 2 and 4 thereof, violate the Due Process Clause of the Fourteenth Amendment in that said language is vague and ambiguous and provides no ascertainable standard of guilt. Plaintiff further contends that subsection 6 abridges the freedom of expression guaranteed by the First and Fourteenth Amendments in prohibiting "nudity" as defined therein, and that subsection 6 is also unconstitutionally discriminatory in that film and magazine presentations of persons in a state of nudity as defined in the ordinance are not proscribed. Plaintiff prays for a judgment under the Declaratory Judgment Act, 28 U.S.C. § 2201 et seq., declaring the entire ordinance invalid, arguing that the ordinance contains no severability clause, and that if any of the provisions of the ordinance are invalid, the whole of the ordinance should be struck.¹

The complaint was filed on September 27, 1973, and a temporary restraining order was issued by this court on September 28, 1973, enjoining the defendants and their agents from enforcing Ordinance 2768 against the plaintiff. Pursuant to stipulation of the parties, it was further ordered on October 1, 1973, that the temporary restraining order was to continue in effect until a decision on the merits was reached by the court. The defendant made it clear at the pre-trial conference, as evidenced by the pre-trial order, that unless restrained by order of this court, defendants would enforce the ordinance and might revoke plaintiff's liquor license after notice and hearing if it was established to defendant's satisfaction that plaintiff violated the ordinance. Willful violation of the ordinance would subject plaintiff to prosecution for a misdemeanor with a maximum penalty of $100.00 fine for each offense. Trial to the court was held on February 26, 1974.

JURISDICTIONAL PROBLEMS

Before considering the merits of plaintiff's contentions, an examination of other issues raised by the parties is necessary. First, defendant challenges this court's jurisdiction, contending plaintiff has failed to meet the federal question jurisdictional requirement of $10,000.00 under 28 U.S.C.A. § 1331(a). Plaintiff states that enforcement of the ordinance will damage plaintiff in excess of $10,000.00 in that since topless entertainment has been provided, plaintiff's average monthly gross profit has increased from $3,800.00 to $9,000.00. Defendant answers that there is no showing that the net profit was in excess of $10,000.00. Although the relevancy of net profit to possible damages for jurisdictional purposes is doubtful, it is incumbent on the plaintiff to allege a claim that satisfies the required jurisdictional amount. Kinsey v. General Motors Acceptance Corporation, 359 F. Supp. 36 (D.N.D.1973). Plaintiff has met this requirement.

"The rule governing dismissal for want of jurisdiction in cases brought in the federal court is that, unless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal." St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283 at 288, 289, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938).

See also Sanders v. Hiser, 479 F.2d 71 (8th Cir. 1973); Lind v. Canada Dry Corporation, 283 F.Supp. 861 (D.Minn. 1968). In this case, plaintiff has made her claim in good faith, and it does not appear to a legal certainty that plaintiff's claim is less than $10,000.00. The Court finds that plaintiff's net income for 1973 from the Lariat Club's operation was $15,243.93.

Secondly, defendant contends, in effect, that the decision of California v. LaRue, 409 U.S. 109, 93 S.Ct. 390, 34 L. Ed.2d 342 (1972), somehow precludes this court from taking jurisdiction of the case, either on a basis of res judicata as the LaRue decision upheld a nearly identical statute, or that the LaRue decision removed the question from federal courts insofar as it upheld a similar statute on the basis of a very broad power to control the sale of liquor given to the states under the Twenty-First Amendment. The LaRue decision upheld regulations promulgated by the California Department of Alcoholic Beverage Control which prohibited certain sexually explicit live entertainment or films in licensed bars and night clubs. It was held that in view of the states' broad authority to control...