Dolls, Inc. v. City of Coralville, Iowa

Decision Date24 March 2006
Docket NumberNo. 4:05-CV-00092-JEG.,4:05-CV-00092-JEG.
PartiesDOLLS, INC., Plaintiff, v. CITY OF CORALVILLE, IOWA, Defendant.
CourtU.S. District Court — Southern District of Iowa

Edward J. Krug, Krug Law Firm, PLC, Cedar Rapids, IA, Luke C. Lirot, Tampa, FL, for Plaintiff.

Terry J. Abernathy, Thad J. Collins, Pickens Barnes & Abernathy, Cedar Rapids, IA, for Defendant.

ORDER

GRITZNER, District Judge.

This matter comes before the Court on Defendant's Motion to Dismiss (Clerk's No. 9). The Plaintiff, Dolls, Inc., is represented by Edward J. Krug and Luke C. Lirot. The Defendant, City of Coralville, is represented by Terry J. Abernathy and Thad J. Collins. Following a hearing held on Friday, January 20, 2006, this matter is fully submitted and is ready for disposition.

Resolving the pending motion today does not require surveying much of the Supreme Court's rather complex First Amendment jurisprudence applicable to cities' licensing and zoning ordinances regulating whether and where adult-oriented businesses may operate. Instead, this case turns on whether the Plaintiff is the correct party to challenge certain ordinances which have not been applied and, in some instances, cannot be applied, to its business, and, if so, whether it is in the proper posture to do so. The Court resolves both issues in the negative.

FACTS

The Defendant, City of Coralville, Iowa ("Coralville" or "the City"), is a political subdivision of the State of Iowa located in Johnson County. The Plaintiff, Dolls, Inc. ("Dolls"), is an Iowa corporation with its principal place of business in Coralville, Iowa. The company has been in existence since 1996. Wayne Grell is Dolls' president.

For a number of years, Dolls claims it has operated an establishment "predicated on public appeal in the expressive dance performances performed by independent professional artists" who "receive[d] compensation in the form of gratuities from patrons pleased with the expressive performances presented." Dolls claims it facilitated the provision of "First Amendment protected dance performances" emphasizing human sexuality. Artists performing there were not nude but were "scantily attired in more than . . . `pasties and g-strings.'"

In 2004, Dolls sold the building it operated and the land upon which the building stood to the City pursuant to the terms of a negotiated Settlement Agreement. Dolls claims its was forced out of business under threat of condemnation as a result of a concentrated effort by the City to rid itself of adult-oriented businesses.1 Finding a new place for Dolls in Coralville is the focus of this litigation. Coralville, like many communities, has in effect zoning and licensing ordinances governing where businesses, including those like Dolls, may operate.

I. Coralville's Zoning and Licensing Scheme.

Among the stated purposes of Coralville's comprehensive zoning scheme is "to promote the public health, safety, morals, order, convenience, prosperity and general welfare; [and] to conserve and protect the value of property throughout the City and to encourage the most appropriate use of land .... Coralville, Iowa, Ordinances, § 165.02 (2005). To that end, Coralville has established a variety of zoning districts, each of which is eligible to house different types of residences or businesses. Three types of industrial zones exist. See id. § 165.30-.32. Relevant here are "I-2," or "light industrial districts," and "I-3," or "general industrial districts." Id. § 165.31-.32.

I-2 areas are "low impact industrial, business and research area[s] set aside for the location of enterprises that have negligible environmental impacts beyond their property limits." Id. § 165.31. The minimum lot size for these types of areas is 10,000 square feet. Id. § 165.31(6)(A). Only certain types of businesses may operate in 1-2 areas, some with and some without a provisional, conditional use, or special exception permit issued by the City Zoning Administrator ("Administrator") and the City's Board of Adjustment ("Board"). See id. § 165.31(2)-(5).

Land zoned I-3 is to be "a general purpose industrial and business area for the location of activities and enterprises that might be otherwise objectionable in other areas of the community and by the nature of their activity may result in some negative impacts upon their environment." Id. § 165.32. The stated purpose of 1-3 districts "is to provide for such uses in the community and to properly insure their negative impacts are properly mitigated." Id. Left unexplained are these "negative impacts" or how these enterprises could be "otherwise objectionable" to surrounding property owners. See id. The minimum lot size for land zoned I-3 is 250,000 square feet, or just under six acres. Id. § 165.32(6)(A).

Only waste water treatment plants may operate in I-3 areas without some kind of license. Id. § 165.32(2)(A). Other businesses require provisional use permits issued by the Administrator, id. § 165.32(3), conditional use permits issued by the Board, id. § 165.32(4), or special exception permits issued by the Board, id. § 165.32(4). Requiring conditional use permits are "[s]exual activity establishment[s],2 massage establishment[s],3 adult bookstore[s],4 adult cabaret[s],5 adult motion picture theater[s],6 or other similar forms of adult entertainment" (collectively, "adult-oriented businesses"). Id. § 165.32(4)(D). In addition to adult-oriented businesses, the conditional use permit requirement applies to less exotic businesses such as animal by-product rendering facilities, chemical manufacturing plants, slaughter plants, and businesses conducting quarrying and mining operations. Id. § 165.32(4)(A)-(C). In addition to a conditional use permit, some businesses, including adult-oriented businesses, must also submit a site plan, id. § 165.32(4)(B)-(D), but only adult-oriented businesses must propose "one non-lighted sign no larger than four square feet," id. § 165.32(4)(D).7

Nowhere in its Complaint does Dolls challenge the City's site plan procedures, nor does it challenge the City's regulations regarding signs. Dolls only specifically challenges procedures applicable to provisional use permits and special exception permits, which are not required to operate an adult-oriented business. See, e.g., Compl. ¶¶ 36-40. (To this end, the City's Complaint appears to contain a typographical error. Compare Compl. ¶ 34 (listing section 165.49 as containing conditional use permit procedures), with Compl. exh. H, at 1 (listing section 165.50 as containing conditional use permit procedures)). Elsewhere in its Complaint, Dolls challenges the "conditional use provision[s]" generally, without specifically identifying a section of the City's ordinances. E.g., Compl. ¶ 43. Consequently, the Court will construe Dolls' Complaint as, inter alia, a challenge to the City's conditional use permit procedures.

Coralville's ordinances provide detailed procedures regulating when conditional use permits will issue. See generally Coralville, Iowa, Ordinances § 165.50. In addition to a fee, an applicant must submit Is]upporting information" and "documentation" indicating compliance with the City's zoning ordinances. Id. § 165.50(1)(4). The property owner must also submit to the Administrator "[a] signed and attested statement . . . indicating compliance with all provisions [of the City's zoning ordinances] and a detailed explanation of any permitted nonconformities on the subject property." Id. § 165.50(4). After a complete application is submitted, the Administrator must set a public hearing before the Board within thirty days. Id. § 165.50(5). Before a conditional use permit issues, the Board must "determine[ ] on the basis of specific information presented at the public hearing or contained in the application" the satisfaction of a number of conditions as follows:

A. The proposed conditional use will comply with all applicable regulations of the Zoning Ordinance, including, but not limited to lot requirements, use limitations and all other standards and conditions contained in the provision authorizing such use.

B. Adequate utility, drainage and other necessary facilities or improvements have been provided or will be provided.

C. Adequate access will be provided and designed so as to prevent traffic hazards and to minimize traffic congestion on public streets and alleys and on site.

D. All necessary licenses and permits required for the operation of the conditional use have been obtained, or it clearly appears that such permits are obtainable for the proposed conditional use on the property.

E. The location and size of the conditional use, the nature and intensity of the activities to be involved or conducted in connection with it, the size of the site in relation thereto and the size of the site with respect to streets giving access to the conditional use, shall be such that it will be in harmony with appropriate and orderly development of the district and the neighborhood which it is located.

F. The location, nature and height of buildings or structures on the site and nature and extent of the landscaping and screening on the site shall be such that the use will not reasonably hinder or discourage appropriate development, use or enjoyment of adjacent land, buildings or structures.

G. The proposed conditional use will not cause substantial injury to the value of other property in the neighborhood in which it is located and will contribute to and promote the convenience and welfare of the public.

Id. § 165.50(6)(A)-(G).

Unless the Board "acts" on an application within thirty days, it is deemed denied. Id. § 165.50(7). However, the Board is required to "render a written decision on the application for a conditional use permit within thirty ... days after the close of the hearing." Id. § 165.50(8). Any decision of the Board must include "specific findings of fact...

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