Zebulon Enters., Inc. v. Dupage Cnty.
| Decision Date | 29 March 2022 |
| Docket Number | 19-cv-5165 |
| Parties | ZEBULON ENTERPRISES, INC., Plaintiff, v. DUPAGE COUNTY, ILLINOIS, Defendant. |
| Court | U.S. District Court — Northern District of Illinois |
Clyde DeWitt, Pro Hac Vice, Law Offices of Clyde DeWitt, a Nevada Professional Corporati, Las Vegas, NV, Wayne B. Giampietro, Poltrock & Giampietro, Chicago, IL, Jeffrey B. Fawell, Fawell & Associates, Wheaton, IL, for Plaintiff.
Anthony Edward Hayman, Patrick Joseph Collins, Conor Patrick McCarthy, DuPage County States Attorney's Office, Wheaton, IL, for Defendant.
Elaine E. Bucklo, United States District Judge Plaintiff Zebulon Enterprises, Inc. ("Zebulon"), an adult bookstore and entertainment facility, sued DuPage County, Illinois ("DuPage") to challenge DuPage's adult-entertainment ordinance, AHAB-O-0031-19 (), as violative of Zebulon's rights under the First and Fourteenth Amendments as well as under the Illinois Constitution. DuPage has now moved for summary judgment on Zebulon's surviving counts--its first, third, fifth, seventh, and eighth claims for relief in the operative Third Amended Complaint. For the reasons that follow, the motion for summary judgment [101] is granted in part and denied in part.
Summary judgment is proper where "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). I construe the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in favor of that party. See Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
Since at least the mid-1980s, Zebulon has operated an adult bookstore in unincorporated DuPage County. ECF No. 120-1 ¶¶ 1, 13. In addition to a retail sales section, Zebulon's establishment includes two "adult arcade" rooms that house twenty-nine private video viewing booths in which customers may view sexually explicit materials on the premises. Id. ¶ 3.
On June 25, 2019, DuPage County adopted adult business ordinance AHAB-O-0031-19. Id. ¶ 11. The stated purpose of the ordinance was "to promote and enhance the health, safety, and general welfare of the citizens of the County, by combating and, or, alleviating negative and harmful secondary effects associated with adult businesses ... including: crime (namely sex crimes, prostitution, violence against women and children, public indecency, public lewdness, drug sales, use and possession and human trafficking); adverse effects on nearby properties ...; blight ...; health concerns (unsanitary conditions, spread of sexually transmitted diseases
); impacts on public services ...; and eliminate the dehumanizing influence that adult businesses might have on their employees." ECF No. 101-4 ¶ 2. Per the adopting ordinance, DuPage's Ad Hoc Adult Business Committee considered extensive evidentiary materials concerning the secondary impacts of adult businesses in connection with its development of the ordinance, including secondary effects associated particularly with video viewing booths, which materials included: 56 judicial decisions, 43 academic studies or articles, legislative findings of other jurisdictions, and the testimony of multiple witnesses including law enforcement, real estate, and local business personnel. ECF No. 120-1 ¶¶ 31, 34-35.
The ordinance was amended twice--first on December 10, 2019, and again on November 10, 2020. Id. ¶ 12. Zebulon challenges two main aspects of the ordinance as currently enacted. First, in Sections 20-257, 20-258, and 20-254(B)(4), the ordinance establishes a license requirement for all adult business employees that imposes a $300 application fee and required human trafficking training. See ECF No. 59 ¶¶ 60-61; ECF No. 100-3. Zebulon contends that the fees and training requirements are expensive and burdensome. Second, Zebulon argues that Section 20-264 would require it to make "numerous and costly physical changes" to its premises. See ECF No. 59 ¶ 68. The burdens imposed by the ordinance, Zebulon argues, threaten to put it out of business and unconstitutionally restrict its rights to freedom of speech and expression.
The First Amendment protects non-obscene, sexually explicit speech of the type offered in Zebulon's adult video arcade. See FW/PBS, Inc. v. City of Dallas , 493 U.S. 215, 224, 110 S.Ct. 596, 107 L.Ed.2d 603 (1990), holding modified by City of Littleton v. Z.J. Gifts D-4, L.L.C. , 541 U.S. 774, 124 S.Ct. 2219, 159 L.Ed.2d 84 (2004). Because "the central thrust of Zebulon's claim is that it is being regulated out of existence through ... the Ordinance's new building layout requirements," the ordinance is best evaluated under the framework set out in City of Renton v. Playtime Theatres, Inc. , 475 U.S. 41, 106 S.Ct. 925, 89 L.Ed.2d 29 (1986), and City of Los Angeles v. Alameda Books, Inc. , 535 U.S. 425, 122 S.Ct. 1728, 152 L.Ed.2d 670 (2002), which has been used in zoning-ordinance cases. Zebulon Enters., Inc. v. DuPage Cnty. , 438 F. Supp. 3d 881, 887-88 (N.D. Ill. 2020). The Renton / Alameda framework instructs that "courts reviewing regulations of adult entertainment establishments [must] consider: (1) whether the regulation constitutes an invalid total ban or merely a time, place, and manner regulation, (2) whether the regulation is content-based or content-neutral, and accordingly, whether strict or intermediate scrutiny is to be applied, and (3) if content-neutral, whether the regulation is designed to serve a substantial government interest[,] [is narrowly tailored to serve that interest,] and allows for reasonable alternative channels of communication." R.V.S., L.L.C. v. City of Rockford , 361 F.3d 402, 407 (7th Cir. 2004) ; see BBL, Inc. v. City of Angola , 809 F.3d 317, 327 (7th Cir. 2015).
On its face, the ordinance in question is a time, place, or manner restriction; it imposes licensing and physical premises requirements rather than prohibiting erotic expression outright. See R.V.S. , 361 F.3d at 409 (); see also Metro Pony, LLC v. City of Metropolis , No. 11-cv-144-JPG, 2011 WL 746201, at *2 (S.D. Ill. Feb. 24, 2011) (). Accordingly, I proceed to the second inquiry, which determines whether strict or intermediate scrutiny applies.
In the context of the second prong of the Renton / Alameda analysis, "[t]he ‘content-neutral’ label ... is a misnomer; regulations aimed at adult businesses apply to certain types of speech and not others" so are necessarily content-based, but nevertheless, "[r]egulations on sexually oriented businesses are nearly always reviewed under intermediate scrutiny." BBL , 809 F.3d at 325. Rather than an examination of content neutrality, the "second step is best conceived as an inquiry into the purpose behind the ordinance." R.V.S. , 361 F.3d at 407. When, as here, "the government relies on a secondary-effects justification to regulate [sexually oriented] expression, we ‘presume that the government did not intend to censor speech’ and therefore apply intermediate scrutiny." BBL , 809 F.3d at 326. Of course, the legislature voicing the "magic words" "secondary effects" does not end the inquiry; "whether the adverse secondary effects invoked by the municipality have a basis in reality and are likely to be reduced by the challenged regulation are important inquiries in the intermediate-scrutiny analysis." Id. But Id. (citing City of Erie v. Pap's A.M. , 529 U.S. 277, 292, 120 S.Ct. 1382, 146 L.Ed.2d 265 (2000) (plurality opinion)).
Because the facial purpose of the ordinance was to combat secondary effects, I have no trouble concluding that intermediate scrutiny applies here. The relevant inquiry, then, for each of the challenged provisions of the ordinance, is "whether the regulation is designed to serve a substantial government interest[,] [is narrowly tailored to serve that interest,] and allows for reasonable alternative channels of communication." R.V.S. , 361 F.3d at 407 ; BBL , 809 F.3d at 327.
Turning first to claim III, Zebulon challenges the ordinance's employee licensing fee. Section 20-257(A) makes it unlawful "to act as an adult business employee ... without a valid adult business employee license." ECF No. 100-3 § 20-257(A). Those licenses must be applied for, and under Section 20-258(G), "[e]ach new application shall be accompanied by the non-refundable fee of three hundred dollars." Id. § 20-258. The licenses expire at the end of each year. Id. § 20-262(C).
"[A] governmental body may enact a reasonable permit fee requirement to defray the cost of administering permissible regulation of a particular form of speech." S.-Suburban Hous. Ctr. v. Greater S. Suburban Bd. of Realtors , 935 F.2d 868, 897 (7th Cir. 1991). However, where it does so, the government bears the burden to demonstrate that its imposed fee "is not excessive in that it did not exceed the [government]’s costs in enforcing its ... regulations." Id. at 898. DuPage has not met that burden here.
In support of its $300 employee licensing fee, DuPage offers an affidavit from Jeff Martynowicz, Chief Financial Officer of DuPage County. ECF No. 101-25 ¶ 3. Mr. Martynowicz concludes that the approximate cost to DuPage of issuing a new employee license is approximately $440, and the cost of renewing...
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