Opinion ID: 603788
Heading Depth: 3
Heading Rank: 2

Heading: Adult Businesses' Hardship

Text: 33 We turn now to the question of whether the district court in this case abused its discretion when it found that the Adult Businesses had met the hardship criterion for a preliminary injunction. The City argues that the district court improperly considered the commercial viability of the potential relocation sites for the Adult Businesses. We do not agree. The record in this case indicates that a real question exists about whether the ordinance provides the Adult Businesses with constitutionally sufficient alternative relocation sites for their businesses. 34
35 The first issue is whether the relocation sites offered by the City are part of the business real estate market. 36 The Adult Businesses' geographical expert, Michael Taugher, conducted an extensive survey of the City to determine which geographical areas within the City would be permissible as potential sites for establishing or relocating these adult businesses. Mr. Taugher found that there are 11,613.1 acres of what the parties call definitionally available relocation sites where the City would allow an adult business to exist. Out of these 11,613.1 acres, however, Mr. Taugher concluded that much of the land was not truly available. 37 Mr. Taugher based his findings on what he termed physical or practical considerations. He found the following: 1) thousands of potentially available acres are submerged beneath the Pacific Ocean or the outer harbor of the Port of Los Angeles; 2) some of the land is presently being used as landing strips for the Los Angeles Airport; 3) two hundred acres are currently being used as landfill; 4) 600 acres are currently used as the Van Nuys airport; 5) 4,357.51 acres are currently used by the Port of Los Angeles and/or oil refineries; and 6) about 230 acres are used for petroleum gas storage. In addition, he found that the ITT Gilfillian Defense plant, the General Motor Assembly plant, a portion of Children's Hospital as well as other large businesses or institutions are located on definitionally available sites. He concluded that out of the 11613.1 acres of definitionally available land, only 7440.9 acres are realistically available for an adult business. Only 0.18% of this realistically available land is in a commercial zone. 38 Bruce Bailey, a real estate expert employed by the Appellees, used criteria similar to Mr. Taugher's. Mr. Bailey excluded those relocation sites that he considered physically inadequate such as parcels of land now occupied by junk yards, steel yards and car storage lots. He also excluded parcels of land that were occupied by single purpose buildings such as shipping yards, the Los Angeles airport, and a large oil refinery complex (id.). Mr. Bailey concluded that there were perhaps 120 potentially viable relocation sites that met the requirements of the zoning ordinance. 39 The City contends that these experts arrived at their conclusions by considering: 1) the commercial viability of the relocation sites; and 2) whether these sites were actually as opposed to potentially available. The City is correct that at times Mr. Bailey improperly considered factors such as whether relocation sites were operatively expensive or whether adult businesses would not be welcomed by landlords. Notwithstanding this, Mr. Bailey's final estimation of available relocation sites resulted from his reliance on factors other than commercial viability. 40 Applying the factors we have enumerated above, we believe that the areas eliminated from consideration by Mr. Taugher and Mr. Bailey are properly excluded under Renton since these areas do not fall within the relevant market. First, much of the land the Adult Businesses' experts considered unsuitable land is not potentially available. Land under the ocean, airstrips of international airports, and sports stadiums are not relocation sites likely to ever become available to the Adult Businesses, or indeed to any commercial business. Second, and turning to those relocation sites which are located in manufacturing zones, many of the areas excluded by Appellees' experts are not readily accessible to the public. Third, many of the sites the Adult Businesses' experts found to be unsuitable are inadequate for any generic commercial business. While Renton did not consider undeveloped land to be unsuitable for relocation, the Adult Businesses' experts testified that the City here has provided the Adult Businesses relocation sites that are developed in a manner totally incompatible with any average commercial business. Fourth, many of the excluded relocation sites appear to lack a proper infra-structure. In short, aside from the question of commercial viability, it is unreasonable to consider the acreage eliminated from consideration by the Adult Businesses' experts as relocation sites that fall within the business real estate market. 41
42 Once the areas that are not part of the market are excluded, the question becomes whether the remaining acreage provides the Adult Businesses with a reasonable opportunity to relocate. The parties agree that there are presently 102 different adult entertainment businesses in the city of Los Angeles. Of these 102 existing businesses, the City located five which it believed to be in compliance with all of the various restrictions of § 12.70. The Adult Businesses' expert Mr. Taugher concluded that all but one of the 102 adult entertainment businesses could not meet the requirements of the ordinance. 43 At first glance, the 120 sites deemed practically available by Mr. Bailey would appear to be constitutionally sufficient, given that there are approximately only 102 adult businesses now in operation in the City of Los Angeles. Yet a more careful analysis of the evidence suggests otherwise. First, the number of businesses that need to relocate may be well higher than 102 since under the ordinance, single stores that sell two sorts of adult entertainment are to be considered multiple businesses and thus cannot operate at a single location. 44 Second, the estimation of the quantity of sites available within the market may well be inaccurate. Like the ordinance considered in Walnut Properties, Inc., 861 F.2d 1102 (9th Cir.1988), this ordinance imposes a 1,000 foot separation requirement between any two adult businesses. This means, however, that as soon as any particular site is occupied by a new adult business, any other adult entertainment business is automatically precluded from relocating upon any other definitionally available plot within a contiguous 72 acre circle around the first business. 45 Mr. Taugher did not work out how much acreage was available after the 1,000 foot restriction was factored in to his evaluation. However, since many of the definitionally available areas were adjacent to each other, he concluded that acreage available to the tenth or twentieth business to relocate would be dramatically less than the percentage of area definitionally available to the first adult business. We have not estimated the number of sites available in either the commercial or the manufacturing zones of the city. However, it is clear from the map in the record that once the 500 foot residential restriction is factored in, the definitionally available locations are clustered together in several parts of the City. There is no doubt that the 1000 foot restriction between any two adult businesses would severely reduce the actual number of potentially available relocation sites. In addition, Mr. Taugher testified that he was not sure of the accuracy of his estimate of definitionally available sites. He did not determine whether portions of existing structures that were within a definitionally permissible area fell within a prohibited zone. 46 A corollary point is that there is a possibility that some of the sites included in the relevant market may be included improperly. If so, this also would reduce the number of reasonable sites potentially available. While Mr. Taugher roughly estimated the amount of land that could be considered physically or practically available, he did not determine whether there was a further decrease in available land due to factors such as inaccessability, lack of proper infra-structure such as lighting, road and sidewalk access, or the presence of other disabling characteristics of the site. In sum, a risk exists that a comparison between the estimation of the total number of adult businesses and the total available acreage is misleading. 47 Therefore, the district court did not abuse its discretion in finding that there would be serious hardship to the Adult Businesses if an injunction against enforcement of the ordinance was not granted.