Clear Channel Outdoor Inc. v. City of Portland

• Citation: 262 P.3d 782,243 Or.App. 133
• Decision Date: 25 May 2011
• Docket Number: 980100125; A135896.
• Parties: CLEAR CHANNEL OUTDOOR, INC., a Delaware corporation, formerly known as Ackerly Media Group, Inc., a Washington corporation, dba Clear Channel Outdoor, Plaintiff–Appellant,v.CITY OF PORTLAND, Defendant–Respondent,andJoseph Cotter, Intervenor–Respondent.
• Court: Court of Appeals of Oregon

243 Or.App. 133

262 P.3d 782

CLEAR CHANNEL OUTDOOR, INC., a Delaware corporation, formerly known as Ackerly Media Group, Inc., a Washington corporation, dba Clear Channel Outdoor, Plaintiff–Appellant,

v.CITY OF PORTLAND, Defendant–Respondent,andJoseph Cotter, Intervenor–Respondent.

980100125; A135896.

Court of Appeals of Oregon.

Argued and Submitted Jan. 13, 2010.Decided May 25, 2011.

Michael T. Garone, Portland, argued the cause for appellant. With him on the opening brief was Schwabe, Williamson & Wyatt, P.C. With him on the combined reply and answering brief were Donald Joe Willis, Jill Gelineau, and Schwabe, Williamson & Wyatt, P.C. Tracy Poole Reeve, Senior Deputy City Attorney, argued the cause and filed the briefs for respondent.Joseph Cotter filed the brief pro se.Before SERCOMBE, Presiding Judge, and WOLLHEIM, Judge, and RIGGS, Senior Judge.SERCOMBE, J.

This case concerns the remedies available to plaintiff, a sign company that sells advertising space on billboards, after plaintiff obtained a declaration from the court that portions of the City of Portland's sign code were unconstitutional under Article I, section 8, of the Oregon Constitution. When the city did not issue a number of sign permits sought by plaintiff, plaintiff filed suit requesting, among other things, an injunction ordering that the city issue the permits. After an initial ruling by the trial court that portions of the code were facially unconstitutional, the city adopted curative amendments to excise the declared illegality. Because of the curative code amendments as well as the nature of the constitutional deficiency in the sign code, the trial court subsequently refused to grant plaintiff's requested injunction. The court also refused to award damages and attorney fees to plaintiff.

On appeal, plaintiff contends that, in light of unconstitutional provisions in the initial and the amended sign codes, the entire code was unenforceable. Therefore, according to plaintiff, it was entitled to injunctive relief directing the city to issue its permits. Plaintiff argues further that it suffered damages because of the application of a sign code that violated the federal constitution and that the court erred in refusing to award damages and attorney fees. The city responds that the unconstitutional provisions did not result in the denial of plaintiff's permits and did not damage plaintiff. For the reasons explained below, we affirm.

I. HISTORICAL FACTUAL BACKGROUND

The disputed sign code provisions relate to the city's past attempts to regulate billboards and painted wall signs—as opposed to painted wall murals. Other questioned provisions limited the size of signs and contained adjustment criteria—that is, the standards for adjusting the requirements of the sign code.

Plaintiff provides advertising on outdoor signs in the City of Portland and throughout Oregon. Plaintiff and its predecessors have filed a number of lawsuits over the years challenging the constitutionality of the city's regulation of billboards. As a result of that litigation, plaintiff and the city stipulated to a judgment in June 1986, which allowed for a specific number of billboards and substituted a particular permit approval process for the process otherwise required under the sign code. The stipulated judgment expired in September 1996.

Prior to the expiration of the stipulated judgment, the city amended its sign code in two ways that particularly affected the display of large signs and that are the subject of the dispute in this case. Prior to 1991, the city defined “sign,” the objects regulated by its sign code, as

“[m]aterials placed or constructed primarily to convey a message or other display and which can be viewed from a right-of-way, private roadway or another property.”

Former Portland City Code (PCC) 33.12.710(Y) (1986).¹ That code defined a “painted wall sign” as “[a] sign applied to a building wall with paint and which has no sign structure.” Former PCC 33.12.710(Q) (1986). However, the city exempted “[p]ainted wall decorations and painted wall highlights” from the provisions of the code that regulated signs, former PCC 33.535.100(G) (1986), and defined “painted wall decorations” as “displays painted directly on a wall and * * * designed and intended as a decorative or ornamental feature,” former PCC 33.12.710(0) (1986).

In 1991, in an effort to clarify the status of painted wall murals as “painted wall decorations” and thus exempt them from regulation under the code, the city amended the definitions of “painted wall decorations” and “sign” by adding the following italicized text:

“Painted wall decorations. Displays painted directly on a wall which are designed and intended as a decorative or ornamental feature. Painted wall decorations do not contain text, numbers, registered trademarks, or registered logos.

“* * * * *

“Sign. Materials placed or constructed primarily to convey a message and which can be viewed from a right-of-way or another property. Signs contain text, numbers, registered trademarks, or registered logos.”

Former PCC 33.910.030 (1991) (Sign–Related Definitions). The trial court found that the primary purpose of that amendment was “to encourage ‘art’ “ and “restrict[ ] commercial speech, particularly to allow and encourage such wholesome activities as children painting wall murals; the City's secondary interests were administrative practicality and avoiding another loss in court.” (Footnote omitted.)

The second change occurred in September 1996, immediately prior to the expiration of the stipulated judgment later that month. That sign code amendment reduced the maximum allowed size of signs to 200 square feet. The amendment precluded the two standard billboard display configurations in Portland—that is, (1) a 288 square foot “poster” with dimensions of 12 feet by 24 feet and (2) a 672 square foot “bulletin” with dimensions of 14 feet by 48 feet. The 1996 sign code also retained a 25–feet height restriction for signs; plaintiff's billboards were commonly 50 feet in height.

The trial court concluded that the effects of those changes made plaintiff's existing billboards nonconforming uses, not subject to future replacement, and precluded new billboard sign permits:

“Although it is clear that by some time in the future, the City's sign code and related ordinances would require plaintiff to remove all nonconforming signs absent some change in the law or other intervention, it is not at all clear from this record how quickly plaintiff would in fact lose how many of its 566 existing billboards. All that the record shows is that nonconforming uses are legal, that when the existing use ceases or is so modified to be subject to new regulation, the nonconforming use must cease, that there are some occasions that permit relocation when the use is lost by government action, and that the regulations governing nonconforming uses are ‘complicated.’ “

(Footnote and citation omitted.)

In late 1997, concerned about the constitutionality of the sign/painted wall decoration distinction in its sign code, the city began to reconsider whether to regulate painted wall decorations (murals) in the same manner as it regulated painted wall signs. On December 17, 1997, the city adopted a moratorium on any new painted wall sign or wall decoration within the central portion of the city, temporarily abandoning any regulatory distinction between painted wall signs and wall decorations. City of Portland Ordinance No. 171881. That moratorium was extended to the rest of the city in August 1998. City of Portland Ordinance No. 172599.

Plaintiff filed nine applications for 11 painted wall signs in the central city district on December 16, 1997, immediately prior to the adoption of the moratorium. It sought two permits for wall signs outside the central city district on January 14, 1998, prior to the expansion of the moratorium. The city denied those sign permit applications because the signs exceeded the code's size limitation of 200 square feet.

On July 2, 1998, plaintiff filed building permit and land use applications for 83 new billboards. All of the requested signs exceeded the 200 square foot size limitation. The city denied 29 of the requested permits because the proposed billboards were located in areas where signs were not allowed. Plaintiff's requests for variances of the size limitation for the remaining applications were denied under the city's sign adjustment criteria, as were the supplementary requests for design review for eight of the applications.

II. PROCEDURAL HISTORY

Plaintiff's petition for review and second amended complaint, which was filed on August 6, 1998, framed the claims that were ultimately decided by the trial court. The petition sought a writ of review of the adoption of the 1997 moratorium ordinance that applied to the central portion of the city, claiming various procedural errors in its adoption and substantive concerns with its constitutionality under the state and federal constitutions. The first claim for relief in the amended complaint sought a declaration that the moratorium ordinance was unconstitutional and void. The remaining claims for relief sought declaratory and injunctive relief, together with damages under 42 USC section 1983, because of the purportedly unconstitutional portions of the sign code. In its second claim for relief, plaintiff requested a declaration that the distinction in the sign code between “sign,” “painted wall sign,” and “painted wall decoration,” as well as the city's sign regulations (including the sign adjustment criteria) and the “city's design review regulations * * * and the city's design guidelines,” violated the First and Fourteenth Amendments to the United States Constitution and Article I, sections 8 and 20, of the Oregon Constitution, as “content-based, overbroad, vague, and discriminatory.” ² The third claim for relief sought an injunction mandating the issuance of the 83...