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Louisiana State Univ.

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Monday, May 31, 2010

Ninth Circuit Rules On Challenges To L.A.'s Billboard Regulation Scheme

The Ninth Circuit has reversed in part a lower court ruling in World Wide Rush v. City of Los Angeles, which challenges the city's billboard regulation scheme as an unconstitutional limit on commercial speech.

The City regulates signs, including billboards, through Chapter I, Article 4.4 of the Los Angeles Municipal Code ("LAMC"). Article 4.4's stated purpose is to "promote public safety and welfare" by "provid[ing] reasonable protection to the visual environment" and by ensuring that billboards do not "interfere with traffic safety or otherwise endanger public safety." LAMC § 14.4.1. Article 4.4 prohibits some types of billboards and restricts the size, placement, and illumination of others.

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These appeals arise from First Amendment challenges to certain content-neutral provisions of Article 4.4: the "Freeway Facing Sign Ban" and the "Supergraphic and Off-Site Sign Bans."
Article 4.4's Freeway Facing Sign Ban prohibits billboards located within 2,000 feet of and "viewed primarily from" a freeway or an on-ramp/off-ramp. LAMC § 14.4.6(A). Notwithstanding the Freeway Facing Sign Ban, the City has permitted freeway-facing billboards in some circumstances, two of which are applicable here. First, in 1999, the City adopted an ordinance authorizing billboards near the Staples Center, a state-of-the-art sports and entertainment complex that was developed to eliminate blight and dangerous conditions in downtown Los Angeles. See Los Angeles, Cal., Ordinance No. 172465 (1999). The City asserted that the nature of the Staples Center's use, coupled with its location in the center of a highly urbanized area, required billboards that could effectively communicate event-related information. Id. Today, there are several freeway facing billboards near the Staples Center, including some that use flashing displays and frequently changing digital content.

The City made another exception to the Freeway Facing Sign Ban in 2008, when it undertook plans to renovate Santa Monica Boulevard with the aim of improving the flow of traffic between the 405 Freeway and the Beverly Hills border. See Los Angeles, Cal., Ordinance No. 179827 (2008). However, the targeted traffic corridor was home to sixteen billboards, the outright elimination of which might have triggered the City's obligation to compensate the billboards' owners under California's eminent domain law. See Cal. Bus. & Prof. Code § 5412. To avoid the requirements of takings law, including the obligation of just compensation, the City agreed with the billboard owners that four sign faces could be relocated to a newly created special use district ("SUD") near Fifteenth Street. While the relocated billboards would face a freeway, the Fifteenth Street SUD resulted in a net reduction of billboards in the City.

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The district court granted WWR summary judgment on its First Amendment claims.... It concluded that the Freeway Facing Sign Ban violates the First Amendment because the City's decisions to allow freeway facing billboards at the Staples Center and in the 15th Street SUD undermine its stated interests in safety and aesthetics. ... It ruled that "preserving even one freeway-facing sign" was fatal to the Freeway Facing Sign Ban....The district court also concluded that the Supergraphic and Off-Site Sign Bans violate the First Amendment because "the City can avoid the blanket ban on off-site and supergraphic signs simply by enacting a specific plan in a certain area, but there are no standards that would prevent the City from enacting a specific plan because it wishes to approve particular speech or a particular speaker." ...Further, it found that the requirement that SUDs and development agreements conform to specific plans is "a loophole that eviscerates the standards" governing SUDs and development agreements.... The district court concluded, "The City has set up a system that allows it to eliminate speech based on content." ...Accordingly, the district court entered an order enjoining the City from enforcing the Freeway Facing Sign Ban and the Supergraphic and Off-Site Sign Bans as to WWR's billboards.

The City thereafter decided that several of WWR's supergraphic billboards violated other Article 4.4 provisions not covered by the district court's injunction. For instance, the City cited WWR for violations of Article 4.4's regulations restricting the size of "wall signs" and for failing to obtain proper permits for several billboards. Faced with the new citations, WWR returned to the district court, arguing that the City was using other provisions of Article 4.4 to circumvent the district court's order and that it could not obtain the necessary permits because the City continued to enforce the invalidated provisions. The district court concluded that the City improperly had denied WWR permits and issued WWR citations under the guise of other Article 4.4 provisions, when, in fact, the City was continuing to enforce the Supergraphic and Off-Site Sign Bans in contravention of the injunction. ...The district court found the City in civil contempt and required it to discharge certain citations.

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As a general matter, there is no question that restrictions on billboards advance cities' substantial interests in aesthetics and safety. ... However, a city "may diminish the credibility of [its] rationale for restricting speech in the first place" where it exempts some speech from the general restriction. ...The critical question is whether the City "denigrates its interest in . . . safety and beauty and defeats its own case by permitting" freeway facing billboards at the Staples Center and in the Fifteenth Street SUD while forbidding other freeway facing billboards. ... "To put it in the context of the Central Hudson test, a regulation may have exceptions that undermine and counteract the interest the government claims it adopted the law to further; such a regulation cannot directly and materially advance its aim," and is, therefore, unconstitutionally underinclusive.

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Here, the City's exceptions to the Freeway Facing Sign Ban do not undermine the City's interests in aesthetics and safety. Indeed, the exceptions were made for the express purpose of advancing those very interests. Allowing billboards at the Staples Center was an important element of a project to remove blight and dangerous conditions from downtown Los Angeles. Similarly, the Fifteenth Street SUD was an outgrowth of the City's efforts to improve traffic flow, and thereby safety, on Santa Monica Boulevard. Not only did the agreement to allow signs in the Fifteenth Street SUD advance that project, it also resulted in a net reduction of billboards in the City. Ironically, the most significant denigration to the City's interests in traffic safety and aesthetics might result, not from allowing the freeway facing billboards at the Staples Center and in the Fifteenth Street SUD, but instead from strict adherence to the Freeway Facing Sign Ban, which might have severely hampered, if not completely defeated, both projects.

The district court took an all-or-nothing approach to its constitutional analysis of the Freeway Facing Sign Ban, stating that to "preserv[e] even one freeway-facing sign . . . undermines the City's stated interests in traffic safety and aesthetics." .... Our First Amendment jurisprudence, however, contemplates some judicial "deference for a municipality's reasonably graduated response to different aspects of a problem."  As the Supreme Court has explained, "It does not follow from the fact that the city has concluded that some commercial interests outweigh its municipal interests in this context that it must give similar weight to all other commercial advertising."...Moreover, exceptions to the Freeway Facing Sign Ban must be considered holistically, not in isolation. Again, the Supreme Court has explained, "[T]he effect of the challenged restriction on commercial speech ha[s] to be evaluated in the context of the entire regulatory scheme, rather than in isolation."

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"[E]valuated in the context of the entire regulatory scheme," the challenged exceptions to the Freeway Facing Sign Ban do not render the Ban "so pierced by exceptions and inconsistencies" as to be unconstitutionally underinclusive. ... The City reasonably may have concluded that, on balance, safer and more attractive thoroughfares would result from renovations to Santa Monica Boulevard and a reduction in the City's total number of billboards, even if this required installation of some freeway facing billboards along Fifteenth Street. The City also reasonably may have concluded that the benefits of redeveloping and attracting people to an otherwise dangerous and blighted downtown area outweighed the harm of additional freeway facing billboards restricted to that area.

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In concluding otherwise, the district court relied on the Supreme Court's decision in Greater New Orleans. There, the Court concluded that a federal regulation prohibiting advertisements for gambling in private casinos but allowing advertisements for gambling on reservations violated the First Amendment. ... Greater New Orleans is inapposite, however, because the regulatory distinction between the two types of casinos counteracted the government's purported interest in minimizing gambling. As the Greater New Orleans Court explained, allowing one type of advertising while prohibiting the other would merely channel gamblers to the reservations, thus rendering the regulation "squarely at odds with the governmental interests asserted in this case." ... The Freeway   Facing Sign Ban is not a means by which the evil sought to be prohibited is simply channeled elsewhere, at odds with the asserted governmental interests. Rather, the City submitted a convincing rationale -- which is entirely consistent with its asserted governmental interest -- for exempting some freeway facing signs from its Ban.

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Under the prior restraint doctrine, "a law cannot condition the free exercise of First Amendment rights on the unbridled discretion of government officials." ...The district court concluded that the Supergraphic and Off-Site Sign Bans were unconstitutional prior restraints on speech because their exceptions impermissibly vest the City Council with unbridled discretion to select among speakers on the basis of content. This legal conclusion was erroneous, however, because the prior restraint doctrine does not apply to the legislative function at issue here. The exceptions to the Supergraphic and Off-Site Sign Bans are rooted in the City Council's legislative discretion, not its discretion to make executive decisions as part of the LAMC's regulatory scheme. This distinction makes all the difference.

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The First Amendment requires standards to cabin the legislative body's authority to execute aspects of the regulatory scheme in such circumstances because that authority "is distinct from the general discretion a legislative body has to enact (or not enact) laws." ...


This is not that rare circumstance in which the legislative body created a licensing power and reserved it for itself. The City Council's authority to enact special plans, create SUDS, or enter into development agreements derives from its regular and well-recognized legislative power to regulate land use. It does not depend upon or derive from the Supergraphic and Off-Site Sign Bans. The City Council would have the power to employ any of those land use tools even if none was ever mentioned in the Bans; the Bans do no more than affirm the existence of these legislative powers. The First Amendment is not implicated by the City Council's exercise of legislative judgment in these circumstances.

Our recent decision in Long Beach Area Peace Network is illustrative. There, the city enacted a regulatory scheme by which permits would be issued for certain gatherings in public places. See Long Beach Area Peace Network, 574 F.3d at 1025-26. The city council retained the ability to waive permit fees, but the ordinance did not provide standards to cabin the council's exercise of that authority. ...The ordinance was subject to attack under the prior restraint doctrine because the city council's authority was "unlike its usual legislative authority." .... Instead, that authority derived exclusively from the permitting scheme:

Absent a preexisting permitting scheme, a city council could not in advance impose service charges or other fees on a group seeking to hold a demonstration in a public forum.

Id. Here, by  contrast, the City Council does have the authority to employ specific plans, SUDs, and development agreements absent the Supergraphic and Off-Site Sign Bans. Because the prior restraint doctrine does not require the City to restrict "the general discretion a legislative body has to enact (or not enact) laws," the district court erred in concluding that the Supergraphic and Off-Site Sign Bans are unconstitutional prior restraints on speech....


The district court erred in holding that the billboards at the Staples Center and in the Fifteenth Street SUD render the Freeway Facing Sign Ban an unconstitutionally underinclusive restriction on commercial speech under Central Hudson. The district court also erred in concluding that the Supergraphic and Off-Site Sign Bans are unconstitutional prior restraints on speech. We therefore REVERSE the grant of summary judgment in favor of WWR and VACATE the injunctions in favor of WWR and Sky Tag. We also REVERSE the district court's order finding the City in civil contempt of the injunction as to WWR's billboards. We AFFIRM the district court's order amending the scheduling order and admonishing the parties that future amendments would not be entertained.

The case is World Wide Rush, LLC v. City of Los Angeles, Nos. 08-56454, 08-56523, 09-55494, No. 09-55792, No. 09-55791, 2010 U.S. App. LEXIS 10797.




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