Recall that in 1990 the Supreme Court decided FW/PBS v. City of Dallas, a case that most of us now take for granted, but one which could have spelled disaster for the adult retail industry - really the entire adult industry - if it had not come down as it did, a 6-3 decision holding that ordinances requiring licenses for adult entertainment businesses must include provisions insuring that applications be acted upon within a short and specified period of time and that prompt judicial review must be available for the unsuccessful applicant. The opinion also reminded everyone that the criteria for granting or denying a license must be objective, for example that the applicant must be at least 18 years of age, and not leave discretion in the licensing agency, for example that the applicant be "qualified" or of "good character." FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 110 S.Ct. 596, 107 L.Ed.2d 603 (1990).
Laws governing so-called "privilege licenses," such as for liquor sales, pawn shops, gambling (where it is legal), doctors, cab drivers and so on, normally vest in the public officials' substantial discretion to determine who is entitled to a license and under what conditions. Some have less discretion than others.
A license to practice law, for example, is issued typically to anyone over 18 who has graduated from an accredited law school and has passed the state's bar examination. Right? Not quite. Most states have the caveat that the applicant be of "good moral character," whatever that is. Convicted felons, by definition, usually are not of good moral character. But a life without crime is not per se good moral character; rather, it is what the committee of bar examiners, or whatever the licensing body is called, thinks is good moral character. It is completely subjective, so the licensing body can make up the rules as it goes along. (Certainly at least some readers at this point must be wondering how, given the "good moral character" requirement, the author of this article managed to be admitted to the practice of law by two states, eight federal districts, seven federal courts of appeals and the United States Supreme Court, as well as pro hac vice in dozens of other courts.)
Public officials almost universally believe that, because they were able to muster 51% of the votes, they know better what is good for you than you do. So, when they enact laws requiring permits or licenses for commercial endeavors, they always manage to leave themselves a good deal of latitude, believing that they will know what is best. And most ordinances requiring such permits and licenses vest the public officials profoundly more discretion than the "good moral character" requirement for attorneys. Politicians also tend not to require that anything be done by any specified deadline because, as all of you know, government gets things done when it is good and ready, if ever.
This entire state of affairs suits politicians well. Want a development permit that must be approved by the City Council? Do you think that the developer that made good campaign contributions will stand a better shot than the one who didn't? Liquor licenses? Taxi cab permits? Conditional use permits? Zoning variances? The list is endless. The line between supporting good political candidates and bribing them is a little fuzzy in this area.
As a product of the above proclivities of local governments, scores of municipal adult-business licensing ordinances have been struck down by federal and state courts because the legislation failed to meet the requirements of FW/PBS. Finding adult bookstores distasteful, for example, the City Council - which is accustomed to requiring conditional use permits for "problem" businesses - tacks on a requirement that adult bookstores must have conditional use permits (CUP). Zap! Conditional use permits almost invariably are discretionary, have associated with them no time limits for issuance or denial, and have no swift process for judicial review. Many such CUP requirements have been struck down in the shadow of FW/PBS.
Hopefully, by now you have been reminded of how important that decision was. So, when the Supreme Court took up an issue about which FW/PBS was unclear - whether prompt judicial "review" meant a prompt judicial result, or simply prompt access to the courts - many became very uneasy out of concern that the Court might in some way whittle away at the wonderful result of FW/PBS. Three times the Court agreed to hear the prompt judicial review issue because of the mixed results in the lower federal appellate courts, some of those courts holding that only prompt access to the courts was satisfactory and others holding that a prompt judicial decision was required.
The first two Supreme Court cases fizzled insofar as the judicial review issue was concerned. The first one was declared moot because the relevant adult bookstore went out of business while the Supreme Court was processing the case. City News & Novelty, Inc. v. City of Waukesha, 531 U.S. 278, 121 S.Ct. 743, 148 L.Ed.2d 757 (2001). The second one failed to decide the issue because the court figured out that the challenged ordinance was a general one, rather than one directed primarily to speech, and therefore FW/PBS did not apply. Thomas v. Chicago Park Dist. , 534 U.S. 316, 122 S.Ct. 775, 151 L.Ed.2d 783 (2002). Finally, just a few weeks ago, the third one stuck. City of Littleton, Colo. v. Z.J. Gifts D-4, L.L.C. , ___ U.S. ___, ___ S.Ct. ___, ___ L.Ed.2d ___, 2004 WL 1237360 (June 7, 2004).
The Court in Z.J. Gifts gave an overwhelming endorsement to the principles of FW/PBS. Whew! The opinion went on to hold that prompt judicial review indeed did mean a prompt judicial decision, and that mere prompt access to the courts was not sufficient - a significant victory. However, in sort of an odd result, the Court held that an ordinance scheme that failed to provide for a prompt judicial decision was not one that could be attacked on its face but, rather, only on a case-by-case basis. What does that mean? Good question!
If an ordinance fails to provide the time or discretion components required by FW/PBS, it is a facially invalid prior restraint on speech. Someone subject to it, therefore, need not apply for the license prior to challenging the ordinance in court. Rather, the complaining party can go straight to federal court and obtain an injunction against enforcement of the licensing requirement and proceed to operate without the required license with impunity. But because the Supreme Court now has said that the requirement of a prompt judicial decision was not appropriate for a so-called facial challenge, if an ordinance suffers only that defect then the complaining party must first undertake the license-application process and later complain in court. However, if the license is granted by the city, then the no-harm-no-foul rule kicks in. There would be no forum in which to challenge the ordinance. That is consistent with the general rule, one of the few exceptions to which is prior-restraint cases such as speech licensing, that you cannot complain in court about a regulation unless your ox was gored by it, so to speak.
The question, then, becomes one of what procedures can be employed to obtain relief if your ox is gored. The goring would occur in the form of an administrative license denial. You will have prompt access to the court to challenge the denial. Usually, however, the court to which you must bring your complaint about the denial is the local state court of general jurisdiction, the one where you would go to sue someone for damages or to challenge the title to a parcel of land. The Supreme Court's thinking apparently was that, armed with that Court's admonition requiring a speedy judicial result, the local court would understand that it is under an obligation to promptly decide the license appeal and, accordingly, will do so. There are two problems with that line of thinking.
First, "prompt judicial decision" is an oxymoron - like "military intelligence," "hot water heater" and "jumbo shrimp." The terms "prompt" and "judicial" generally are not found together. That is an especially acute problem in today's environment, where court budgets, and therefore personnel, are being slashed almost everywhere.
The second problem is that the local state court - presided over by the judge who had lunch with the mayor last Friday and soon must stand for reelection - may not be a particularly receptive forum for you. So, if the judge sticks your complaint about license denial in his figurative "bottom drawer," what do you do? Where you want to be is probably federal court, and federal courts are not inclined to meddle in ongoing business of state courts for a reason called "abstention." (Since this decision was rendered, some industry attorneys have claimed that so-called "Younger abstention" would be the problem, which is incorrect because Younger v. Harris and its progeny only apply to state enforcement proceedings, which appeals from license denials are not; other types of abstention, however, could create a barrier.) At least one answer, which may or may not work depending upon how the law evolves, is to file a federal complaint in response to the license denial, the complaint challenging the constitutionality of the licensing requirement itself, coupled with what is called a supplemental jurisdiction claim for relief challenging the license denial. Creative attorneys hopefully will figure out a way to do this.
Most important is that FW/PBS remains in full force and effect. Justice Scalia, who now may be out of the running for chief justice because of duck hunting (and perhaps further because of a Democratic president), again voiced his absurd view that adult bookstores, for example, are not protected by the First Amendment because they are "pandering" erotica. In his view, material otherwise protected by the First Amendment always loses its constitutional protection if it is advertised as being erotic. That is this same justice who, during oral argument in the Playboy signal-bleed case, expressed his opinion that full-length, cable-version adult movies offered by the Playboy Channel enjoyed no First Amendment protection at all.
Another bullet has been dodged!
(Clyde DeWitt is a partner in the Los Angeles, California-based, national law firm of Weston, Garrou & DeWitt. He can be reached through AVN's offices, at his office at 12121 Wilshire Boulevard, Suite 900, Los Angeles, CA 90025 or over the Internet at [email protected]. Readers are considered a valuable source of court decisions, legal gossip and information from around the country, all of which is received with interest. Books, pro and con, are encouraged to be submitted for review, but they will not be returned. This column does not constitute legal advice but, rather, serves to inform readers of legal news, developments in cases and editorial comment about legal developments and trends. Readers who believe anything reported in this column might impact them should contact their personal attorneys.)
