Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_02-cv-03167/USCOURTS-cand-3_02-cv-03167-7/pdf.json

Nature of Suit Code: 950
Nature of Suit: Constitutionality of State Statutes
Cause of Action: 42:1983 Civil Rights Act

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States District C

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For the Northern District of California

NOT FOR PUBLICATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

NANO MALDONADO,

Plaintiff,

 v.

 WILL KEMPTON,

Defendant.

 /

No. C 02-03167 CRB

MEMORANDUM AND ORDER

Plaintiff alleges that California’s Outdoor Advertising Act (“COAA”) is

unconstitutional on its face and as applied to a billboard he owns adjacent to Highway 101 in

Redwood City, California. The Court has previously adjudicated nearly all the claims in this

lawsuit. The only claim remaining is plaintiff’s contention that the State has violated his

equal protection rights by prohibiting off-premises commercial displays on his billboard

while allowing other off-premises commercial displays along the same area of highway. 

Now pending before the Court are the parties’ further memoranda and evidence in

support of their cross motions for summary judgment on the equal protection claim. As the

parties are familiar with the background facts of their long-standing dispute as set forth in the

Court’s several memoranda and orders, they will not be repeated here. After carefully

considering the parties’ papers and evidence, the Court GRANTS defendant’s motion and

DENIES plaintiff’s cross motion.

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UNDISPUTED FACTS

A. The State’s Billboard Laws

California adopted its statutes prohibiting the placement of outdoor advertising

displays adjacent to landscaped freeways in 1953. Declaration of Ronald W. Beals (“Beals

Decl.”) ¶ 3. The statutes originally provided that legally placed billboards existing at the

time of the adoption of the statutes would be removed without compensation within three

years after the freeway section was classified as landscaped. Id. 

In 1965 Congress enacted the Highway Beautification Act, 23 U.S.C. section 131,

which established national regulation for billboards along highways that receive federal aid. 

23 U.S.C. § 131(a) (finding that “the erection and maintenance of outdoor advertising signs,

displays, and devices in areas adjacent to the Interstate System and the primary system should

be controlled in order to protect the public investment in such highways, to promote the

safety and recreational value of public travel, and to preserve natural beauty”). The Highway

Beautification Act imposes its standards upon the states by providing that any state that fails

to comply with the Act shall lose ten percent of its federal highway funds. 23 U.S.C.

§ 131(b). Among other things, the Act requires that “just compensation” be paid to the

owner of any lawfully erected billboard if the state takes from the owner the right to erect

and maintain signs, displays and devices on the billboard. 23 U.S.C. § 131(g). The federal

share of such compensation is 75 percent. Id.

California amended COAA in 1967 to comply with the Highway Beautification Act,

and, in particular, it amended COAA to provide for just compensation. Bus. & Prof. Code

§ 5288.3a (1967). Under the Highway Beautification Act, the State gained jurisdiction over

all federal-aid highways in incorporated areas, such as Redwood City, which included

thousands of off-premises displays that had been erected in accordance with local ordinances

and had not required State permits. Beals Decl. ¶ 5. As a result, many of these displays

became nonconforming, that is, they violated the State landscaped freeway provisions and

other federal requirements. Id. These billboard shall be referred to as “legal,

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nonconforming.” The State subsequently inspected all highways to determine which

billboards were legal under the new law, legal nonconforming, or illegal. Id.

Congress subsequently amended the Highway Beautification Act to specify that states

must pay compensation for the removal of all billboards, regardless of whether the removal is

caused by nonconformance with federal law or more strict state standards. Id. ¶ 12; 23

U.S.C. § 131(g). California’s billboard law complies with the federal act. Bus. & Prof. Code

§ 5412 (“no advertising display which was lawfully erected anywhere within this state shall

be compelled to be removed, nor shall its customary maintenance or use be limited, whether

or not the removal or limitation is pursuant to or because of this chapter or any other law,

ordinance, or regulation of any governmental entity, without payment of compensation”). 

Congress has failed to appropriate any monies to pay its share of the required “just

compensation” for more than 30 years. Beals Decl. ¶ 6. As a result, since 1974 or 1975, the

State has decided not to commence discretionary removals or commence litigation to remove

nonconforming displays if compensation has to be paid. Id. ¶ 9. 

In sum, “since 1967, new outdoor advertising displays have been prohibited along

classified landscaped freeways, but existing, legally erected billboards have been allowed to

remain as “‘nonconforming displays.’” Id. ¶ 15. The State continues to enforce the Act

against illegal displays along landscaped freeways and to require their removal, such as with

plaintiff Maldonado. Beal Decl. ¶ 15-16; Declaration of Christopher Lewis (“Lewis Decl.”)

¶ 8. 

B. Plaintiff’s Billboard and the Surrounding Area

It is undisputed that plaintiff’s billboard does not qualify as a “legal nonconforming”

outdoor advertising display. The State never issued a permit for off-premises commercial

displays on plaintiff’s billboard prior to the State’s adoption of regulations prohibiting such

displays, and the billboard never otherwise lawfully displayed off-premises commercial

advertising. It is equally undisputed that all of the off-premises commercial billboards

identified by plaintiff as evidence of the State’s unequal treatment are either legal, that is, not

adjacent to a landscaped portion of the freeway, or legal nonconforming, that is, these

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It is worth noting that when plaintiff purchased his billboard, the restrictions on offpremises commercial displays were in effect; the right to such displays was not included in the

“bundle of rights” plaintiff purchased with his billboard.

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billboards lawfully displayed off-premises commercial advertisements prior to the State’s

adoption of laws making such displays illegal. Lewis Decl. ¶¶ 5-7. Finally, it is undisputed

that if the State were to require these billboard owners to cease displaying off-premises

commercial advertisements, the State would have to pay the owners just compensation or

otherwise risk losing ten percent of the State’s federal highway funds. See People ex rel.

Dep’t of Transp. v. Desert Outdoor Advertising, Inc., 68 Cal.App.3d 440, 448-51 (1977).

DISCUSSION

Plaintiff argues that the State has violated the Equal Protection Clause by failing to

remove legal nonconforming off-premises commercial displays along landscaped freeways 

while at the same time prohibiting plaintiff from placing off-premises commercial displays

on his billboard.1 In other words, plaintiff objects to the perpetual “grandfathering” of the

legal nonconforming off-premises commercial billboards. The ultimate question, then, is

whether the Equal Protection Clause requires the State to remove all such billboards,

including legal nonconforming billboards, or, in the alternative, requires the State to allow all

off-premises commercial billboards, even those erected after the enactment of the laws

prohibiting such billboards.

“The Equal Protection Clause of the Fourteenth Amendment, § 1, commands that no

State shall ‘deny to any person within its jurisdiction the equal protection of the laws.” 

Nordlinger v. Hahn, 505 U.S. 1, 10 (1992). “The Equal Protection Clause does not forbid

classifications. It simply keeps governmental decisionmakers from treating differently

persons who are in all relevant respects alike.” Id. “[U]nless a classification warrants some

form of heightened review because it jeopardizes exercise of a fundamental right or

categorizes on the basis of an inherently suspect characteristic, the Equal Protection Clause

requires only that the classification rationally further a legitimate state interest.” Id.; see also

New Orleans v. Dukes, 427 U.S. 297, 303 (1976) (“Unless a classification trammels

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fundamental personal rights or is drawn upon inherently suspect distinctions such as race,

religion, or alienage, [the Supreme Court’s] decisions presume the constitutionality of the

statutory discriminations and require only that the classification challenged be rationally

related to a legitimate state interest”).

It is undisputed that the classification at issue here–differentiating between signs that

were legal when erected and those that were never legal–is not based upon an inherently

suspect characteristic. Plaintiff argues, however, that the classification jeopardizes the

fundamental right of free speech; thus, the Court must apply strict scrutiny or at least the

heightened review accorded commercial speech. 

None of the cases cited by plaintiff involve the “grandfathering” of pre-existing legal

commercial speech from new regulations prohibiting such speech; instead, all involve First

Amendment challenges to content-based restrictions on speech. The ordinance at issue in

R.A.V. v. City of St. Paul, 505 U.S. 377 (1982), for example, prohibited fighting words that

insult or provoke violence on the basis of gender, race or religion, but not on any other basis,

such as political affiliation or sexual preference. Id. at 391. Similarly, in Greater New

Orleans v. United States, 527 U.S. 173 (1999), the regulation permitted broadcast

advertisement of Indian casino or state-sponsored gambling, but not of gambling at legal, but

privately-owned casinos. Id. at 190-91; see also Schad v. Borough of Mt. Ephraim, 452 U.S.

61, 72 (1981) (ordinance prohibiting live entertainment but not other types of entertainment

or commercial establishments).

Plaintiff’s contention that the grandfathering provision is content based is

unpersuasive. Whether a law is content based “turns on whether the [law] singles out certain

speech for differential treatment based on the ideas expressed.” G.K. Ltd. Travel v. City of

Lake Oswego, 436 F.3d 1064, 1078 (9th Cir. 2006) (internal quotation marks and citation

omitted). In G.K. Ltd. Travel, the Ninth Circuit held that an ordinance that exempted preexisting pole signs from its prohibition on such signs until such time as the pole sign is

altered was not content based: “A grandfather provision requiring an officer to read a sign’s

message for no other purpose than to determine if the text or logo has changed, making the

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sign now subject to the City’s regulations, is not content based.” Id. at 1079. Here, State

officials do not even have to read a sign’s message to determine if the sign is subject to the

State’s prohibition on off-premises commercial advertising on landscaped freeways; instead,

the official merely reviews State records to determine if the billboard had a permit for such

displays prior to the law’s enactment or was otherwise lawfully erected. As the grandfather

provision is not content based, strict scrutiny is not required. See Jones Intercable of San

Diego, Inc. v. Chula Vista, 80 F.3d 320, 325 (9th Cir. 1996).

The case most closely on point is Outdoor Media Dimensions, Inc. v. Oregon, 150

Or.App. 106, 945 P.2d 614 (1997). The grandfathering law at issue there granted outdoor

advertising permits to those who owned billboards on or before a certain date, but not after. 

Id. at 624. The court held that rational review rather than strict scrutiny applied because the

classification itself was content neutral. Id. at 625. The court concluded that the law’s

prohibition on the installation of new billboards rationally furthered the state’s interest in

aesthetics and safety “because the legislature reasonably could have concluded that placing a

cap on billboards would control visual blight and make traffic signs more visible. Allowing

an exception for billboards already in existence . . . does not compromise the validity of those

interests. . . . [T]he legislature could reasonably have concluded that the property interests of

billboard owners justifies the disparate treatment.” Id. (internal quotation marks and

citations omitted); see also Desert Outdoor Advertising, 68 Cal.App.3d at 450 (applying

rational review to an equal protection claim challenging COAA’s compensation scheme).

The Ninth Circuit addressed an equal protection challenge in the commercial speech

context in Jones Intercable of San Diego, Inc. The plaintiff cable operator sued the city for

damages for rejecting its application to provide cable service to recently-annexed areas of the

City. The district court dismissed the claim as barred by a federal law which precludes

damages relief for a claim against a government entity arising from regulation of cable

service. 80 F.3d at 323. On appeal, the plaintiff argued that the law precluding a damages

remedy violated the Equal Protection Clause because it did not apply to other entertainment

businesses or franchised utilities, such as water, gas and electricity. Id. at 327. The Ninth

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Circuit, after rejecting the plaintiff’s argument that strict scrutiny applies, held that

“[w]hether the applicable standard of equal protection review is one of rational basis or some

intermediate standard, there is ample justification for Congress’s precluding damages only

for the cable operators that it was subjecting to local government franchising power.” Id. 

Here, too, “whether the applicable standard of equal protection review is one of

rational basis or some intermediate standard,” id., there is substantial justification for the

State’s decision not to remove those billboards for which it must pay compensation. First,

the State’s decision to pay compensation to owners of legal nonconforming billboards is

substantially related to a significant government interest. If the State removes the signs but

refuses to pay compensation, the State loses ten percent of its State highway funds. 23

U.S.C. § 131(b), (g). The State, of course, has a substantial interest in retaining those funds. 

See Desert Outdoor Advertising, 68 Cal.App.3d at 450. Second, the State’s decision not to

remove the legal nonconforming billboards and pay compensation is also substantially

related to a significant government interest. As federal law requires the federal government

to pay 75 percent of the just compensation, but the federal government continuously fails to

allocate any funds for such payments, the State would have to pay all of the just

compensation. 

The State’s policy to prohibit new off-premises commercial billboards, but allow legal

nonconforming billboard displays to remain, is also justified; such a policy furthers the

State’s significant interest in reducing blight and increasing traffic safety by reducing the

number of billboards along state highways, even if it does not eliminate them entirely. See

Outdoor Media Dimensions, Inc., 150 P.2d at 625. As the Ninth Circuit has observed, if a

sign ordinance “is designed to advance a valid [government] interest–reducing the number of

dangerous, non-conforming signs–it should not matter that it is underinclusive.” Clear

Channel Outdoor, Inc. v. Los Angeles, 340 F.3d 810, 816 (9th Cir. 2003); see also id. at 815

(“An inspection program that targets only a subset of all signs is not necessarily inconsistent

with the goals of safety an aesthetics for the same reasons that it is permissible to distinguish

between on-site and off-site signs in the first place”). 

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CONCLUSION

The State’s decision not to remove legal, nonconforming off-premises commercial

billboards along landscaped highways, but enforce COAA against illegal off-premises

commercial billboards along the same highways, does not violate the Equal Protection Clause

as a matter of law. As plaintiff offers no evidence that suggests that the State is selectively

enforcing the law against his illegal billboard and indeed, the State’s evidence establishes the

contrary, plaintiff’s motion for summary judgment on plaintiff’s equal protection claim is

DENIED and defendant’s motion is GRANTED. As this is the last claim remaining in this

lawsuit, the Court will issue a judgment.

IT IS SO ORDERED.

Dated: January 10, 2007

 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

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