Cleveland Area Bd. of Realtors v. City of Euclid

• Citation: 88 F.3d 382
• Decision Date: 08 July 1996
• Docket Number: No. 93-4209,93-4209
• Parties: CLEVELAND AREA BOARD OF REALTORS, et al., Plaintiffs-Appellees, v. The CITY OF EUCLID, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 382

88 F.3d 382

CLEVELAND AREA BOARD OF REALTORS, et al., Plaintiffs-Appellees, v. The CITY OF EUCLID, Defendant-Appellant.

No. 93-4209.

United States Court of Appeals Sixth Circuit.

Argued March 17, 1995.

Decided July 8, 1996.

Arthur M. Kaufman (briefed), Robert J. Fogarty (argued), and Robert Kochis, Hahn, Loeser & Parks, Cleveland, OH, for plaintiff-appellee.

Richard A. Wiegand (argued and briefed), City of Euclid, OH, for defendant-appellant.

Before: KENNEDY and DAUGHTREY, Circuit Judges; CLELAND, District Judge. ^*

DAUGHTREY, J., delivered the opinion of the court, in which CLELAND, J., joined. KENNEDY, J. (pp. 391-92), delivered a separate opinion concurring in part and dissenting in part.

DAUGHTREY, Circuit Judge.

The defendant, the City of Euclid, Ohio, appeals from the district court's judgment in an action filed by the Cleveland Area Board of Realtors that challenged the validity of certain City ordinances regulating the size, number, and placement of signs in residential neighborhoods, as violative of the First Amendment's free speech clause. The district court found that the ordinances were invalid, primarily because they were not content-neutral but also because--even if content-neutral--they were not narrowly tailored. For the reasons stated below, we affirm the district court's judgment.

I. FACTUAL BACKGROUND

Before the ordinances at issue were enacted, the City allowed signs anywhere in a residential yard but limited them to five square feet. In November 1992, the first challenged ordinance, No. 246-1992, restricted the placement of real estate "For Sale" signs to the windows of homes in residential areas, and limited the size of those signs to three square feet if the house was within 75 feet of a street and four square feet if the house was more than 75 feet away. A variance procedure was included for homes with obstructed views to their windows. The preamble to the original ordinance listed its rationales in the following section:

WHEREAS, Chapter 1377 of the Euclid Codified Ordinances limits accessory uses in residential districts and this Council has found it necessary to further regulate such use; and

WHEREAS, this Council determines and finds that real estate graphics and other commercial graphics installed in the yards of residential districts are detrimental to property values, damaging to the neighborhood stability and unnecessary as a mechanism to sell or market real estate or other commercial services; and

WHEREAS, real estate and other commercial graphics are an unneeded commercial intrusion into non-commercial residential neighborhoods; and

WHEREAS, this Council finds and determines that real estate signs, in particular, can damage the image and perception about the viability and desirability of a neighborhood as a good place to live and invest for persons of all races; and

WHEREAS, this Council takes note of a variety of alternative means available to persons working to market real estate and other commercial services, including but not limited to, mailings, flyers, newspaper ads, telemarketing and word of mouth; and

WHEREAS, in harmonious [sic], out-of-scale, or incompatible signs adversely affect property values, discourage economic development, and inhibit public convenience; and

WHEREAS, this Council desires to promote and preserve neighborhood aesthetics, peace, health, safety and welfare....

The Cleveland Area Board of Realtors ("CABOR") and several realty companies sued under 42 U.S.C. § 1983, alleging that the City had violated the First Amendment by enacting the ordinance. The complaint sought a declaratory judgment that the ordinance was unconstitutional under the First Amendment, the due process clause, and the equal protection clause of the United States Constitution, as well as the Ohio Constitution. ¹ CABOR requested an injunction and expenses in bringing suit.

After CABOR sued in December 1992 and was granted a temporary restraining order, the city council amended the ordinance ten days before trial was scheduled, to apply to all commercial signs except those indicating the name and address number of the homeowner and those temporarily displaying the name of an architect, engineer, or contractor at work (Ordinance No. 5-1993). Trial of the case was rescheduled, and a week before it finally began, the council once again amended the ordinance, this time to cover all yard signs, commercial and non-commercial, except those displaying the residents' name and address and pertinent security system information. The preamble to this final ordinance, No. 80-1993, noted the city council's desire

... to maintain property values, maintain open space and a residential atmosphere in residential neighborhoods, prevent the nuisance of visual pollution and proliferation of signs, and limit the intrusion of commercial atmosphere in residential use districts.

The final ordinance also indicated that it was enacted to conform to a recent Supreme Court case, City of Cincinnati v. Discovery Network, 507 U.S. 410, 113 S.Ct. 1505, 123 L.Ed.2d 99 (1993), which the preamble interprets to

... require[ ] equal treatment of core commercial speech with noncommercial speech under the First Amendment ... where the visual pollution, aesthetics, diminution of safety and property values caused by one classification of sign over another, if any, may not be readily calculated....

After a ten-day bench trial, the district court reviewed the ordinances as a whole and applied the test for "time, place, or manner" restrictions on speech, inquiring into whether the restrictions were content-neutral, whether they were narrowly tailored to serve a substantial government interest, and whether they left open ample alternative channels of communication. With regard to whether they were content-neutral, the court found that although the City's stated "principal justification" for the ordinances was to improve the City's appearance, the facts showed that the City's actual motivation was not to improve aesthetics but to "curtail[ ] the negative messages that are often associated with the proliferation of real estate signs in neighborhoods." Cleveland Area Bd. of Realtors v. The City of Euclid, 833 F.Supp. 1253, 1264 (N.D.Ohio 1993). In making this finding, the court first relied on a 1991 "Real Estate Action Plan" to the Mayor from the Director of Community Services. The plan focused on promoting Euclid as a place to live, but included a suggestion for sign ordinance legislation to "quiet" the housing market. The plan did not mention aesthetics, but focused on the problem of realtors "steering" customers. In addition to the 1991 plan, the court relied on the comments of the ordinances' sponsor, Councilman Cervenik, and Kory Koran, the Director of Euclid's Community Services, who expressed concern over the perception that "For Sale" signs create. The court also noted that a 1992 survey of 200 residents indicated that a majority of residents did not approve sign legislation and that a 1991 survey by Councilman Dallos was consistent with that survey. The court relied upon a letter from the City's Director of Law, Paul Oyaski, to Patricia Carey, CABOR's Director of Government Affairs, discussing the yard sign issue in terms of fair housing rather than aesthetics. In addition, the court observed that the original ordinance's preamble acknowledged the council's concern over the perception that real estate signs create. Finally, the court opined that the final ordinance in response to Discovery Network was passed a week before trial to protect the City's interest in this case rather than to promote aesthetics by including non-commercial signs within the ambit of the regulations. For these reasons, the court concluded that the ordinances were content-based regulations designed to intercept the negative messages that real estate signs convey. Id. at 1264.

The court also found that even if the ordinances were content-neutral, and despite the fact that they could be found to be narrowly tailored to serve a significant interest in aesthetics, they did not leave open ample alternative channels for speech. This finding was based in part on expert testimony offered at trial concerning such things as the relative visibility of window signs. Moreover, after a driving tour of Euclid, the district judge determined that window signs were ineffective as an alternative method of communication and that the lawn sign ordinances were therefore a de facto ban on residential signs. Because the district judge found the remaining options for a real estate seller to be more costly and to provide less autonomy to the seller by requiring an agent, she viewed the ordinances as offering inadequate alternatives. In addition, the district judge found the alternatives to political signs, such as door-to-door knocking, mailings, newspaper advertising, public appearances, private gatherings, and window signs as "completely inadequate" replacements for yard signs. Therefore, the court struck the ordinances as violative of the First Amendment. Id. at 1264-66.

II. ANALYSIS

A. The Appropriate Constitutional Standard

The district court analyzed the comprehensive scheme established by the three ordinances as a "time, place, and manner" restriction on speech. It therefore asked whether they are "justified without reference to the content of the regulated speech, [whether] they are narrowly tailored to serve a significant governmental interest, and [whether] they leave open ample alternative channels for communication of the information." Clark v. Community for Creative Non-Violence, 468 U.S. 288, 293, 104 S.Ct. 3065, 3069, 82 L.Ed.2d 221 (1984).

The City argues that the district court should have applied the test for restrictions on commercial speech to the first two ordinances which addressed only commercial signs, and should have reserved the "time, place, and manner" analysis for the final ordinance, which included...