Encore Videos, Inc. v. City of San Antonio

• Decision Date: 29 October 2002
• Docket Number: No. 00-51119.,00-51119.
• Citation: 310 F.3d 812
• Parties: ENCORE VIDEOS, INC., Plaintiff-Appellant, v. CITY OF SAN ANTONIO, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

310 F.3d 812

ENCORE VIDEOS, INC., Plaintiff-Appellant, v. CITY OF SAN ANTONIO, Defendant-Appellee.

No. 00-51119.

United States Court of Appeals, Fifth Circuit.

October 29, 2002.

COPYRIGHT MATERIAL OMITTED

Arthur Myron Schwartz, Schwartz & Goldberg, Michael W. Gross (argued), Arthur M. Schwartz Law Office, Denver, CO, for Plaintiff-Appellant.

Donald S. Bayne (argued), Michael P. Hodge, San Antonio, TX, for Defendant-Appellee.

Appeal from the United States District Court for the Western District of Texas.

Before SMITH and EMILIO M. GARZA, Circuit Judges, and CUMMINGS,^* District Judge.

JERRY E. SMITH, Circuit Judge:

I.

Appellant Encore Videos, Inc. ("Encore Videos"), operates a sexually oriented retail video store in San Antonio, Texas. In April 1995, the city council enacted Ordinance # 82135, which forbids sexually oriented businesses from locating within 1000 feet of residential areas. Encore Videos' store is within 1000 feet of a residential area, although separated by the Loop 410 highway. Encore Videos provides only sales for off-premises viewing; customers cannot view the videos at the store.

In September 1997, Encore Videos sued, challenging the ordinance on First Amendment grounds. In response, the city amended and reenacted the ordinance to impose procedural safeguards required by FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 110 S.Ct. 596, 107 L.Ed.2d 603 (1990). The new law, Ordinance # 87443, took effect in March 1998. Encore Videos filed an amended complaint challenging the new ordinance on federal and Texas state constitutional grounds.

The district court granted the city's motion for summary judgment and denied Encore Videos'. Encore Video [sic], Inc v. City of San Antonio, No. Civ. A. SA-97-CA1139FB, 2000 WL 33348240 (W.D.Tex. Oct.2, 2000). Encore Videos appeals, arguing that the ordinance offends by the First Amendment and the state Constitution. We reverse and remand.

II.

A.

Before addressing the merits of the First Amendment claim, we must determine whether the ordinance should be analyzed as a prior restraint — as advocated by Encore Videos — or as a time, place, and manner regulation. As a general rule, "a law subjecting the exercise of First Amendment freedoms to the prior restraint of a license, without narrow, objective, and definite standards to guide the licensing authority," is a presumptively unconstitutional "prior restraint." Shuttlesworth v. City of Birmingham, 394 U.S. 147, 150-51, 89 S.Ct. 935, 22 L.Ed.2d 162 (1969). Zoning regulations restricting the location of adult entertainment businesses are considered time, place, and manner regulations, however, if they do not ban them throughout the whole of a jurisdiction and are "designed to combat the undesirable secondary effects of such businesses" rather than to restrict the content of their speech per se.¹ Relevant harmful secondary effects of adult businesses include crime, reduction of economic activity, and lowered property values. Lakeland Lounge, 973 F.2d at 1257.

There is no evidence of improper censorial motives on the part of the city council. Where "nothing in the record ... suggests impermissible motives on the part" of the enacting legislature, a local government seeking to use the secondary effects justification need show only that "(1) the drafters of the ordinance did rely upon studies of secondary effects," and (2) a "majority" of the city council members received "some information about the secondary effects." Lakeland Lounge, 973 F.2d at 1259.

In an opinion rejecting a First Amendment challenge to Ordinance # 82135, the predecessor to Ordinance # 87443, we held that the city "relied on studies provided by the City Council relating to secondary effects." Natco, Inc. v. City of San Antonio, No. 98-50645, slip op. at 6 (5th Cir. June 2, 1999) (unpublished). In this circuit, unpublished opinions issued on or after January 1, 1996, generally are not binding precedent, although parties may cite them, and they have "persuasive value." 5TH CIR. R. 47.5.4. Natco's factual findings on the exact point at issue surely carry "persuasive" weight. Id. They also have been endorsed by the district court a quo. In any event, there is no reason to go against the factual findings of Natco on this point, and we follow them here.

Even a content-neutral regulation may be considered a prior restraint if it gives government officials "unbridled discretion" to restrict protected speech.² But Ordinance # 87443 does not fall into this category, because the Director of Building Inspections may deny a sexually oriented business's permit application only if the applicant seeks to utilize a location within 1000 feet of a residential neighborhood another sexually oriented business, or several other precisely specified types of properties. San Antonio Ordinance # 87443 § 2(a)-(f).

B.

1.

To pass constitutional muster, a time, place and manner regulation must be "content-neutral, ... narrowly tailored to serve a significant government interest, and leave open ample alternative channels of communication." Frisby v. Schultz, 487 U.S. 474, 481, 108 S.Ct. 2495, 101 L.Ed.2d 420 (1988) (internal citations omitted). In City of Renton, 475 U.S. at 47, 106 S.Ct. 925, the Court created some confusion as to the appropriate test by stating that "time, place, and manner regulations are acceptable so long as they are designed to serve a substantial governmental interest and do not unreasonably limit alternative avenues of communication." This phrasing seems to eliminate the requirement of narrow tailoring.

Nonetheless, later Supreme Court decisions on time, place, and manner regulations have continued to apply the narrow tailoring standard.³ A leading post-City of Renton secondary effects decision of this court also applied it. See SDJ, Inc. v. City of Houston, 837 F.2d 1268, 1273 (5th Cir. 1988).⁴ We therefore conclude that the requirement of narrow-tailoring remains in force.

Encore Videos argues that the San Antonio ordinance fails to meet the first three of the four requirements of the time, place, and manner test. We address each in turn.

2.

The first requirement is content neutrality. "`The principal inquiry in determining content neutrality, in speech cases generally and in time, place, and manner cases in particular, is whether the government has adopted a regulation of speech because of disagreement with the message it conveys.'" Hill v. Colorado, 530 U.S. 703, 719, 120 S.Ct. 2480, 147 L.Ed.2d 597 (2000) (quoting Ward, 491 U.S. at 791, 109 S.Ct. 2746). Although Encore Videos claims that Ordinance # 87443 is "content-based," it provides no evidence to support that assertion.

The inquiry here is similar to that applied to the question of secondary effects motivation, described in part II.A, infra. It is not certain, however, whether the two tests require the same degree of proof of improper motive before a regulation fails them. Even so, an ordinance for which the record discloses zero proof of improper motive surely passes both tests.

3.

We next consider the requirement that the ordinance serve a substantial government interest. "A city's `interest in attempting to preserve the quality of urban life is one that must be accorded high respect.'" City of Renton, 475 U.S. at 50, 106 S.Ct. 925 (quoting Young v. Am. Mini Theatres, 427 U.S. 50, 71, 96 S.Ct. 2440, 49 L.Ed.2d 310 (1976) (plurality opinion)). "Local governments ... can restrict adult businesses in order to control the bad `secondary effects' — such as crime, deterioration of their retail trade, and a decrease in property values — that the establishments bring." Lakeland Lounge, 973 F.2d at 1257. There is, therefore, no doubt that the secondary effects that the San Antonio ordinance seeks to remedy are important enough to be considered a substantial government interest under the time, place, and manner test.

We have interpreted the substantial government interest standard as requiring not only a showing of the importance of the interest, but also a demonstration that the challenged statute, at least to some degree, is effective in serving that interest.⁵ This approach arguably conflicts with City of Renton, which mandates only that a statute be "designed to serve a substantial government interest" and does not require evidence of effectiveness. City of Renton, 475 U.S. at 47, 106 S.Ct. 925 (emphasis added). City of Renton does require proof of the existence of the secondary effects that the challenged ordinance seeks to eliminate but does not consider the question of proof of effectiveness in combating them. Id. at 50-52, 106 S.Ct. 925. This court's caselaw also may be in tension with other Supreme Court time, place, and manner cases that require evidence of effectiveness and necessity only as a part of the narrow-tailoring prong of the time, place, and manner test. See, e.g., Frisby, 487 U.S. at 484-87, 108 S.Ct. 2495. Nonetheless, J&B Entertainment is binding on us unless overruled en banc.

Fortunately, this question has little practical significance for the present case. Evidence of effectiveness too weak to survive scrutiny under J&B Entertainment's version of the substantial interest standard — which requires only that the "government must present sufficient evidence to demonstrate `a link between the regulation and the asserted governmental interest' under a `reasonable belief' standard" — surely will also fail to meet the requirements of the much more stringent narrow tailoring prong. See J&B Entertainment, 152 F.3d at 372.⁶ We therefore choose not to address any apparent inconsistency in the caselaw and, instead, will consider the relevance of the ordinance's effectiveness under the narrow tailoring prong.⁷

4.

The ordinance's constitutionality under the time, place, and manner test therefore turns on the narrow tailoring prong. It fails to meet this test and therefore is unconstitutional.

a.

i.

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