Opinion ID: 76252
Heading Depth: 2
Heading Rank: 3

Heading: Ordinance 1204's Licensing Provisions

Text: 54 The district court held the licensing provisions of Ordinance 1204 unconstitutional because they vest unfettered discretion in the City to deny a license and impose no time restriction on this decision. The district court upheld the ordinance's licensing fee. The parties filed cross-appeals on these issues.
55 Ordinance 1204 provides that the City may deny an applicant a license if the granting of the application would violate either a statute or ordinance or an order from a Court of law that effectively prohibits the applicant from obtaining an adult entertainment establishment license, or if the applicant fails to comply with Florida law regarding corporations, partnerships, or fictitious names. Ordinance 1204, §§ 2.5-12(c)(1)(E) & (F). Furthermore, the ordinance does not require the City to act on an application within a prescribed time period, providing only that, if the City fails to act within thirty days, a license to operate pending that decision must be issued. Ordinance 1204, § 2.5-12(a). 56 The district court held that these provisions amounted to an unconstitutional prior restraint upon protected expression. 24 We agree. 57 [A] law subjecting the exercise of First Amendment freedoms to the prior restraint of a license, without narrow, objective, and definite standards to guide the licensing authority, is unconstitutional. Shuttlesworth v. City of Birmingham, 394 U.S. 147, 150-51, 89 S.Ct. 935, 22 L.Ed.2d 162 (1969). See also Lakewood v. Plain Dealer Pub. Co., 486 U.S. 750, 757, 108 S.Ct. 2138, 100 L.Ed.2d 771 (1988). We have previously invalidated such statutes, holding: 58 [S]tatutes may not give public officials unbridled discretion to deny permission to engage in constitutionally protected expression. This implies that some measure of discretion is acceptable, but ... virtually any amount of discretion beyond the merely ministerial is suspect. 59 Lady J. Lingerie, Inc. v. City of Jacksonville, 176 F.3d 1358, 1362 (11th Cir.1999) (citations omitted). 60 Ordinance 1204 exceeds the limits of permissible ministerial discretion. Its provisions permit city officials to decide which statutes or ordinances apply, whether the applicant has violated those laws, and whether they effectively prohibit the applicant from obtaining a license. In striking down a similar licensing scheme, we held: 61 [T]he decision of which ordinances apply, and whether such ordinances have been violated in any given case are decisions that [the ordinance] leaves to the judgment of the city clerk and city commission. City officials thus retain considerable discretion to find ordinance violations, and consequently to deny licenses. 62 Miami Herald Pub. Co. v. City of Hallandale, 734 F.2d 666, 675 (11th Cir.1984). As in Hallandale, the judgments authorized by the provisions of Ordinance 1204 cannot be reasonably characterized as simply ministerial. 63 The ordinance also permits the City unconstitutionally to deny an adult entertainment license by failing to act on an application. See Freedman v. Maryland, 380 U.S. 51, 59, 85 S.Ct. 734, 13 L.Ed.2d 649 (1965) (Constitution requires limitation on the time within which licensing decision is made); FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 110 S.Ct. 596, 107 L.Ed.2d 603 (1990) (licensing officials required to make prompt decisions); 25 Artistic Entertainment, Inc. v. City of Warner Robins, 223 F.3d 1306, 1310-1311 (11th Cir.2000). Although the ordinance requires a decision on a adult entertainment license application within thirty days, it also permits the establishment whose application is not so resolved to open, conditioned on the ultimate licensing decision of the City. Effectively, this gives the City an unlimited length of time to make the application decision. We have previously held such a conditional right to be an unconstitutional prior restraint. Lady J. Lingerie, 176 F.3d at 1363. We said there: 64 Does it matter that an applicant may begin operating while the [zoning] board is still considering its application? We think not. The ordinance only permits applicants to operate conditionally. Once the board denies an application for an exception, the applicant must close its doors. A conditional exception is no exception at all. 65 Id. 66 In so far as Ordinance 1204 permits city officials excessive discretion in making the licensing decision and an indefinite period of time within which to make that decision, we hold that these provisions are unconstitutional. 26
67 Finally, Fly Fish contends that the City may not charge a licensing fee that constitutes a tax on the exercise of First Amendment protected expressive conduct. See Murdock v. Pennsylvania, 319 U.S. 105, 113-14, 63 S.Ct. 870, 87 L.Ed. 1292 (1943); Cox v. New Hampshire, 312 U.S. 569, 577, 61 S.Ct. 762, 85 L.Ed. 1049 (1941). Under Murdock and Cox, when core First Amendment freedoms are made subject to a licensing scheme, only revenue-neutral fees may be imposed so that government is not charging for the privilege of exercising a constitutional right. Id. See also Sentinel Communications v. Watts, 936 F.2d 1189, 1205 (11th Cir.1991) (government may not profit from imposing revenue-raising fees on exercise of First Amendment rights). Furthermore, it is the government's burden to demonstrate that its licensing fee is reasonably related to recoupment of the costs of administering the licensing program. Id. 68 The City contends that these cases do not apply to the fee at issue here, because adult entertainment — nude dancing — is not a core First Amendment freedom and does not enjoy more than marginal constitutional protection. The Eighth Circuit has endorsed this view. Jakes, Ltd., Inc. v. City of Coates, 284 F.3d 884, 890-891 (8th Cir.2002) ( Murdock and Cox restrictions on licensing fee do not apply to nude dancing). 69 The district court did not discuss this issue, upholding the fee without comment. We cannot do the same. 70 Although we have not previously done so, at least one other circuit court and many district courts, including one in this circuit, have held that Cox and Murdock do apply to licensing fees on adult entertainment. Deja Vu of Nashville, Inc. v. Metropolitan Government of Nashville, 274 F.3d 377, 395 (6th Cir.2001); Kentucky Restaurant Concepts, Inc. v. City of Louisville, Jefferson County, Ky., 209 F.Supp.2d 672, 691-692 (W.D.Ky.2002); AAK, Inc. v. City of Woonsocket, 830 F.Supp. 99, 105 (D.R.I.1993); Ellwest Stereo Theater, Inc. v. Boner, 718 F.Supp. 1553, 1574 (M.D.Tenn.1989); Bayside Enterprises, Inc. v. Carson, 450 F.Supp. 696, 704-705 (M.D.Fla.1978). 71 We agree. Although nude dancing may be at the outer perimeter of the First Amendment's protection, the Supreme Court has never suggested that it is not protected by the First Amendment. On the contrary, Erie recently specifically reaffirmed that it is so protected. 529 U.S. at 289, 120 S.Ct. 1382. The Court made clear that a law aimed at suppressing this protected conduct would violate the First Amendment. Id. 72 Thus, we find no support in Erie for the Eighth Circuit's conclusion that nude dancing is `only marginally' protected. Jakes, 284 F.3d at 891. In fact, the presence of quotation marks around this phrase in Jakes indicates that the court thought it was quoting Barnes. What the Supreme Court actually said in Barnes was that nude dancing of the kind sought to be performed here is expressive conduct within the outer perimeters of the First Amendment, though we view it as only marginally so. Whether at the core or at the margin, a central tenet of Barnes is that, as expressive conduct protected by the First Amendment, government may not ban nude dancing. 27 If government may not ban nude dancing, we fail to see how it may tax that activity without constitutional limit. See Murdock, 319 U.S. at 113-14, 63 S.Ct. 870; Cox, 312 U.S. at 577, 61 S.Ct. 762. 73 Accordingly, we hold today that a licensing fee on adult entertainment establishments is controlled by Cox and Murdock and must be reasonably related to recouping the costs of administering the licensing program. 74 Having so decided, it is the City's burden to establish that its licensing fee is justified by the cost of processing the application. Id. See also Bayside Enterprises, 450 F.Supp. at 704-705. The record made by the City in this case is wholly inadequate to make such a showing. The City concedes that it has conducted no real accounting of the costs of administering its licensing program. Instead, the City argues that the $5000 ($1250 × 4 adult businesses) it collects to administer and enforce its licensing program is reasonable as a matter of law. We disagree. In fact, this seems a substantial amount to administer a program that routinely reapproves the three twenty-year old businesses that the ordinance allows. Absent a record sufficient to support the City's claim that its licensing fee is constitutionally reasonable, we hold that the present fee is unconstitutional.