Nefedro v. Montgomery County, No. 84, September Term, 2009 (Md. App. 6/10/2010)

• Decision Date: 10 June 2010
• Docket Number: No. 84, September Term, 2009.,84, September Term, 2009.
• Court: Court of Special Appeals of Maryland
• Parties: NICK NEFEDRO, v. MONTGOMERY COUNTY, MARYLAND, et al.

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NICK NEFEDRO, v. MONTGOMERY COUNTY, MARYLAND, et al.

No. 84, September Term, 2009.

Court of Appeals of Maryland.

Filed: June 10, 2010.

Bell, C.J., Harrell, Battaglia, Greene, Murphy, Adkins, Barbera, JJ.

Opinion by GREENE, J.

The petitioner in this case, Nick Nefedro, wishes to open a fortunetelling business in Montgomery County. Montgomery County, however, has an ordinance ("the Fortunetelling Ordinance") that prohibits the acceptance of remuneration for fortunetelling. Nefedro has asked us to determine whether the Fortunetelling Ordinance violates his right to freedom of speech under the First Amendment to the United States Constitution and Article 40 of the Maryland Declaration of Rights. Montgomery County argues that the Ordinance does not implicate those constitutional provisions or, in the alternative, that it is consistent with the federal and state constitutions. After reviewing the facts of the case and the relevant sources of law, we shall agree with Nefedro.

PROCEDURAL HISTORY

This case arose in the Circuit Court for Montgomery County. On May 28, 2008, Nefedro filed suit against the County and Isiah Leggett, the County Executive for Montgomery County (collectively, "the County"). In his complaint, Nefedro challenged the Fortunetelling Ordinance on the grounds that it violates the First Amendment and Article 40 of the Maryland Declaration of Rights. The parties filed cross-motions for summary judgment, as well as oppositions and replies to those motions. On December 11, 2008, the trial court granted summary judgment in favor of the County, concluding that the Fortunetelling Ordinance is constitutional. Nefedro noted a timely appeal to the Court of Special Appeals. Before the intermediate appellate court had an opportunity to hear arguments in the case, we issued a writ of certiorari on our own motion. Nefedro v. Montgomery County, 410 Md. 165, 978 A.2d 245 (2009).

FACTS

The following facts are not in dispute. Nefedro is engaged in the fortunetelling business in several locations across the country. In this business, he charges customers a fee in exchange for fortunetelling, palm reading, and other related services. Nefedro has stated that he intends to open a location for his fortunetelling business in Montgomery County.

There is some dispute about what Nefedro has done in furtherance of his expressed intent to open a business in Montgomery County. Nefedro claims that he leased property in Montgomery County, paid rent on the property, purchased furnishings for the property, placed a sign in the storefront announcing that the fortunetelling business would soon open, and attempted to acquire a business license from the Montgomery County Licensing Department. Nefedro says that the supervisor of the Licensing Department denied his request for a license, citing the Fortunetelling Ordinance. The County argues that these claims are unsupported by the record, and, indeed, there is nothing in the record to support Nefedro's claims other than his own assertions. In addition, the County argues that, if anything, Nefedro's assertions suggest that he requested a license from the Montgomery County Circuit Court, not the County itself.¹

There is no dispute that the Fortunetelling Ordinance prohibits the acceptance of remuneration for the performance of fortunetelling. The Ordinance states:

Fortunetelling.

Every person who shall demand or accept any remuneration or gratuity for forecasting or foretelling or for pretending to forecast or foretell the future by cards, palm reading or any other scheme, practice or device shall be subject to punishment for a class B violation as set forth in section 1-19 of chapter 1 of the County Code; and in any warrant for a violation of the above provisions, it shall be sufficient to allege that the defendant forecast or foretold or pretended to forecast or foretell the future by a certain scheme, practice or device without setting forth the particular scheme, practice or device employed; provided, that this section shall not apply to any benefit performance or part thereof conducted pursuant to section 30-4 of this Code.

Montgomery County Code, § 32-7 (1999).

Nefedro filed suit against the County. In his suit, Nefedro asked the court for a declaratory judgment, pursuant to Maryland Code (1973, 2006 Repl. Vol.), § 3-406 of the Courts and Judicial Proceedings Article, stating that the Fortunetelling Ordinance violates his First Amendment right to freedom of speech and Article 40 of the Maryland Declaration of Rights.² The parties subsequently filed various motions, including cross-motions for summary judgment, and the trial court held a hearing on the summary judgment motions. At the hearing, the court concluded that the Fortunetelling Ordinance was constitutional, denied Nefedro's motion for summary judgment, and granted the County's motion for summary judgment. The court stated:

All right. Well, I think this is essentially a police power being exercised by Montgomery County. And, certainly, under its police power it has the right to regulate this type of activity. It's a commercial transaction and even the intermediary [sic] test of this ordinance meets the standard.

So, it certainly has a substantial interest. It's been demonstrated that the regulation directly and materially advances the substantial interests and it is narrowly drawn. It is not prohibiting the speech. It is simply regulating it.

In its written order granting the County's motion for summary judgment, the trial court stated:

[T]he County fortunetelling law . . . is constitutional. The County law regulates speech, not conduct. And, insofar as the County law does regulate speech, it is narrowly drawn to serve the County's compelling governmental interest in protecting its citizenry from fraud.

Nefedro appealed the trial court's ruling. While the case was before the Court of Special Appeals, we granted certiorari on our motion to answer the following question:

Did the trial court err in finding that Montgomery County Code § 32-7, criminalizing the demand or receipt of payment for fortunetelling, does not violate the First Amendment to the U.S. Constitution and Article 40 of the Declaration of Rights of the Maryland Constitution?

After receiving briefs and hearing arguments from both parties, we answer this question in the affirmative and reverse the judgment of the Circuit Court.

DISCUSSION

I.

Standing

As an initial matter, the County argues that Nefedro lacks standing to challenge the Fortunetelling Ordinance. In "a multitude of cases," this Court has "recognize[d] the availability of actions for declaratory judgments or injunctions challenging the validity of statutes or regulations which may, in the future, be applied to or adversely affect the plaintiffs." Jackson v. Millstone, 369 Md. 575, 588-90, 801 A.2d 1034, 1042-43 (2002) (citing many cases).³ Our decision in State v. Lundquist, 262 Md. 534, 278 A.2d 263 (1971), demonstrates this principle in regard to a freedom of speech challenge. In Lundquist, we concluded that there was standing to challenge a statute requiring participation in a flag salute based entirely on one plaintiff's statement that he and his son objected to and would not participate in the ceremony. 262 Md. at 539-40, 278 A.2d at 266-67. In reaching that conclusion, we noted "the obvious chilling effect on [the plaintiffs'] First Amendment rights" and that the Attorney General had stated, in its answer to the plaintiffs' amended complaint, that "a program of enforcement [was] in preparation and await[ed] only the outcome of this case." Lundquist, 262 Md. at 540, 278 A.2d at 267.

The record shows that, at the very least, the Fortunetelling Ordinance will adversely affect Nefedro.⁴ The County does not dispute that Nefedro operates fortunetelling businesses, and Nefedro has expressed an intent to open a fortunetelling business in Montgomery County if he is allowed to do so. The parties also agree that the Fortunetelling Ordinance would prohibit Nefedro from receiving remuneration for fortunetelling. Indeed, the County's argument is founded on its assertion that Nefedro should not be allowed to receive remuneration for fortunetelling because it is, and should be, illegal in Montgomery County. The undisputed facts therefore demonstrate that Nefedro intends to open a fortunetelling business in Montgomery County but that he would be subject to penalties under the Fortunetelling Ordinance if he did so. These facts are sufficient to establish standing.

II.

First Amendment

We now address Nefedro's First Amendment challenge to the Fortunetelling Ordinance. Nefedro argues that the Ordinance violates his right to freedom of speech as guaranteed by the First Amendment.⁵ For the foregoing reasons, we agree.

The Fortunetelling Ordinance Regulates Speech

There seems to be no dispute between the parties in this case that fortunetelling is speech.⁶ Instead, the issues before us are whether the Fortunetelling Ordinance regulates speech and, if so, whether that regulation violates the First Amendment. Nefedro argues that the Ordinance regulates speech and that, accordingly, the law must pass First Amendment scrutiny. The County responds that because the Ordinance regulates only the payment of money for fortunetelling services, it regulates only conduct. As a result, the County asserts, the Ordinance does not implicate the First Amendment. In our view, the Fortunetelling Ordinance does regulate speech.

The First Amendment, as applied to the states by the Fourteenth Amendment, prohibits the states from passing laws "abridging the freedom of speech." U.S. Const. amend. I. The United States Supreme Court has explained:

This provision embodies "[o]ur profound national commitment to the free exchange of ideas." Harte-Hanks Communications, Inc. v. Connaughton, 491 U.S. 657, 686, 105 L. Ed. 2d 562, 109 S. Ct. 2678 (1989). "[A]s a general matter, `the First Amendment means that government has...