News Analysis: How Many Times Can A Missouri Taxpayer Afford To Lose Two Cents?

The total loss was just $120,437.02, and divided by the population of Missouri as of the 2000 census, that came to just a little over two cents per person – but the state's taxpayers may want to ask themselves just how long they want to keep supporting state Sen. Matt Bartle's legislative joyrides in the fields of adult business regulation?

"You know, the legislators who enact these onerous, unconstitutional bills actually have to make a pledge as to the impact, the financial impact of the legislation," noted First Amendment attorney Dick Bryant, "and in this case, the financial impact was alleged to be zero. So taxpayers are hard-pressed to be relying on the drafters of these bills, when they say, 'Well, it won't cost us a thing,' when they know it's unconstitutional on its face, and now they're having to write checks for $120,000 or so. That's a significant financial impact. And as I testified before the committee here not two weeks, three weeks ago, I have mixed emotions as a taxpayer. I'm appalled that we are back looking at a brand new bill on this exact same issue because I don't like to see my tax monies wasted. From a purely mercenary standpoint, though, I say, 'bring it on!' Because, you know, I got a nice car last year, and I wouldn't mind having a new lake house."

Bryant represented Passions Video, a small Missouri retail chain, in the lawsuit against Missouri statute sec. 226.531, passed in early 2004, which restricted on- and off-premises advertising within one mile of a state highway by any business classified as an "adult cabaret" or "sexually-oriented business." The Lion's Den chain of stores, represented by veteran free speech advocate Mike Murray, also sued. Both plaintiffs lost at the district court level, but in late August, 2006, a three-judge panel of the Eighth Circuit Court of Appeals ruled the statute unconstitutional – and it only took the state six months to cut checks to the attorneys.

The attorneys fees resulted from the fact that the billboard statute was clearly unconstitutional, and that the legislature should have known the measure was unconstitutional when it passed it. In fact, the statute was only one of several unconstitutional measures aimed at adult businesses that were proposed by Bartle over the past couple of years.

"I saw that he's trying to pass another one," Murray said, referring to a new anti-adult billboard bill introduced by Bartle in the state Senate within the past two weeks. "I don't know whether it will succeed or not in getting approval, but we'll probably have to litigate it again if it does."

The Eighth Circuit's rationale in knocking down the billboard statute was an old one, dating back to 1980's Central Hudson Gas & Electric Corp. v. Public Service Comm'n, wherein the U.S. Supreme Court set out a four-part analysis to determine whether a particular form of commercial speech is constitutionally protected.

The Central Hudson criteria are 1) whether the affected speech concerns lawful activity and is not misleading, therefore protected by the First Amendment; 2) whether the government's asserted interest in regulating the speech is substantial; 3) whether the regulation directly advances the asserted interest; and 4) whether the regulation restricts no more speech than is necessary to serve the asserted interest – and the burden's on the state both to identify its asserted interest and to justify the restriction imposed.

The first step was easy; no one argued that the billboards weren't commercial speech. As to the second criterion, the statute included a list of interests it sought to protect with the regulation, including mitigating "the adverse secondary effects of sexually oriented businesses, [improving] traffic safety, [limiting] harm to minors, and [reducing] prostitution, crime, juvenile delinquency, deterioration of property values, and lethargy in neighborhood improvement projects."

Interestingly, no evidence had been introduced that the statute did any of those things, and during one of the district court hearings, Murray had brought in a witness who testified that it did none of those things.

"We had an evidentiary hearing in my case," Murray said, "and I put on [sociologist] Bruce McLaughlin. He went into chapter and verse all about secondary effects and how they don't exist and how they particularly don't exist in these kind of [non-arcade] stores, and that the studies are shoddy. But none of that is even relevant to the billboard situation, and I got him to testify that there's never been a study that connected a billboard to secondary effects, so yes, we had plenty of evidence."

But the state had at least set forth what interests it had in regulating the speech, therefore satisfying the second step of Central Hudson. Murray's witness, however, as well as other evidence introduced by the plaintiffs, apparently went a long way toward revealing the lack of connection between the state's claimed interests in the regulation and the statute's fulfilling those interests. In its analysis, the Eighth Circuit divined the state's actual purpose in trying to block the adult businesses' billboard advertising.

"The state argues that its ultimate goal is to reduce the adverse secondary effects of sexually oriented businesses by limiting the  presence of sexually oriented businesses," wrote Judge Gerald Heaney for the panel. "Under that theory, restricting the amount of advertising by the affected businesses would reduce the number of customers that patronize the affected business, thus reducing profits, and ultimately forcing the affected business to close."

That scheme, Murray noted, violated the Supreme Court's ruling in City of Los Angeles v. Alameda Books.

"I had actually pointed out to them in oral argument and in the briefs that if that was the purpose of the statute, then it's even more clearly unconstitutional," Murray explained, "because that's precisely what Justice Kennedy said in his concurrence in Alameda Books, that what a government couldn't do is reduce the so-called adverse secondary effects of adult businesses by reducing the quantity of speech. So that was a pretty easy concept to demolish."

And while the Eighth Circuit admitted that the statute might "directly and materially advance[] the state's asserted interest" if it forced businesses to close, "the statute fails under the final Central Hudson step because it is not narrowly tailored to meets its asserted goals."

"In the final step," the court wrote, "the 'critical inquiry' is whether the regulation's 'complete suppression of speech ordinarily protected by the First Amendment is no more extensive than necessary to further [Missouri's] interest in' reducing the secondary effects of adult businesses. While the state need not pursue the least restrictive means, it must enact a statute that is 'reasonable' and 'narrowly tailored to achieve the desired objective.' The statute cannot 'curtail substantially more speech than is necessary to accomplish its purpose.' The availability of obvious and numerous less-burdensome alternatives to the restriction factors into the consideration whether the 'fit' is reasonable." [Citations removed here and below]

Considering that the Missouri statute threatened criminal prosecution just for including the name or address of the adult business on the billboard, the court found that "[t]he Missouri statute 'sacrifices an intolerable amount of truthful speech about lawful conduct'," and therefore went far beyond its stated purpose, not only for billboards located within one mile of a state highway but also as to the prohibition of signs located on the business itself.

"Should an affected business owner choose to post a sign with the price of gasoline, or a sign advertising a nationally-known soft drink on the exterior of the business," wrote Judge Heaney, "he or she would be subject to criminal prosecution. Thus, Missouri statute section 226.531, in its entirety, is unconstitutional because it fails to survive scrutiny under the Central Hudson test for regulations on commercial speech."

Hopefully, when Sen. Bartle's next proposed unconstitutional adult business regulation is debated in the legislature, someone will introduce both the Eighth Circuit's opinion in this case, as well as copies of Missouri's checks to the businesses' attorneys.