Court Opinion

ID: 3027027
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:37:17.473981+00
Date Added: 2024-06-11T18:24:58.648649
License: Public Domain

United States Court of Appeals
                        FOR THE EIGHTH CIRCUIT
                               _____________

                               No. 00-3348MN
                               _____________

Adam Steele,                           *
                                       *
              Appellant,               *
                                       *
Northern Herald Publications, Inc., a  *
Minnesota corporation,                 *
                                       *
              Plaintiff,               *
                                       *
       v.                              *
                                       *
City of Bemidji, a municipal           *
corporation; Alan Felix, individually  *
and as City Attorney for the City of   *   On Appeal from the United
Bemidji, Minnesota; Phil Shealy,       *   States District Court
individually and as City Manager of    *   for the District of
the City of Bemidji, Minnesota;        *   Minnesota.
Michael Porter, individually and as an *
officer of the Bemidji Police          *
Department; Jon Hunt, individually and *
as an officer of the Bemidji Police    *
Department; Robert Tell, individually  *
and as Chief of Police of the City of  *
Bemidji, Minnesota; Tim Faver,         *
individually and as County Attorney,   *
County of Beltrami, Minnesota; David *
Frank, individually and as Assistant   *
County Attorney, County of Beltrami, *
Minnesota; Lynette Russell, also known *
as Lynette Rex, an individual; Rich    *
Johanneson, individually; Joseph       *
Leuken, doing business as Leuken’s         *
Food Stores; William Batchelder,           *
individually; Terry Smart, individually;   *
Forem Communications Company, a            *
North Dakota corporation; Omar             *
Forberg, individually; Petro Pete’s, the   *
elusive and evasive entity which is        *
doing business as Petro Pete’s Park        *
Rapids; Kitty Lemer, individually;         *
County of Beltrami, State of               *
Minnesota; Developers’ Diversified         *
Realty Corporation, doing business as      *
Paul Bunyan Mall, Bemidji, an Ohio         *
corporation; Johanneson’s, Inc., a         *
Minnesota corporation; Steve Michaels,     *
doing business as Superamerica of Park     *
Rapids; J & B Foods, Inc., a Minnesota     *     On Appeal from the United
corporation; Ron Dargis, doing             *     States District Court
business as Ron’s Foods, doing             *     for the District of
business as Festival Foods; Cooperative    *     Minnesota.
Sampo, doing business as Cenex, Park       *
Rapids, Inc., a Minnesota corporation;     *
Jeff Wizner; Mrs. Jeff Wizner, doing       *
business as Countryside Restaurant,        *
Blackduck, Minnesota; Jackie Hall,         *
doing business as Countryside              *
Restaurant of Bemidji, Minnesota; Judy     *
Black, doing business as Maid-Rite         *
Café Bemidji, Minnesota; Shari Mistic,     *
doing business as Southside Restaurant,    *
Bemidji, Minnesota; Tim Saga,              *
individually; Saga of Bemidji, doing       *
business as Highway Host Restaurant,       *
Bemidji, Minnesota, Inc., a Minnesota      *
corporation,                               *
                                           *
            Appellees.                     *

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                                     ___________

                           Submitted: May 1, 2001
                               Filed: July 30, 2001
                                   ___________

Before MORRIS SHEPPARD ARNOLD, RICHARD S. ARNOLD, and FAGG,
      Circuit Judges.
                         ___________

RICHARD S. ARNOLD, Circuit Judge.

      Adam Steele appeals the District Court’s adverse grant of summary judgment as
to some claims, and the dismissal of other claims, in this suit brought under 42 U.S.C.
§§ 1983, 1985, and 1986; the Sherman Antitrust Act; and state law. We affirm in part
and reverse in part.

       Steele and Northern Herald, Inc., filed an amended complaint naming the City
of Bemidji, City Attorney Alan Felix, City Manager Phil Shealy, Chief of Police Robert
Tell, and Police Officers Michael Porter and Jon Hunt (the “City defendants”); the
County of Beltrami, County Attorney Tim Favor, and Assistant County Attorney David
Frank (the “County defendants”); and twenty-one private individuals and businesses
(the “non-government defendants”). Viewed in the light most favorable to plaintiffs,
the record establishes the following.

       The Northern Herald is a periodical containing political reporting, other news,
and advertising. Plaintiffs publish the Northern Herald and have three means of
distribution: for-profit sales through existing retailers, complimentary distribution, and
direct curbside sales on public streets and sidewalks. In February 1998, Steele was
distributing papers near a mall, when a police officer ordered him to stop doing so.
Steele discussed the matter with the City Manager, who (after a discussion with the

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Chief of Police) confirmed that Steele could not sell the Northern Herald at that
location. After Steele complained to the City, he received a letter from City Attorney
Felix stating that Steele’s use of public property to “advertise and sell [his] alleged
publication” without a solicitation permit and an obstruction permit violated,
respectively, City Code sections 6.39 and 10.31. Felix explained that a section 10.31
permit was conditioned upon the provision of adequate insurance and bond, and that
in light of Steele’s recent bankruptcy, the City was concerned with his ability to
provide adequate financial security. Felix warned Steele that the City would require
“at a minimum public liability coverage with policy limits equal to those required of the
City,” and that given Steele’s “past history of non-payment, a substantial bond [would
be] mandatory.” Finally, Felix pointed out that a violation of either ordinance was a
misdemeanor and suggested that Steele find “willing local, private outlets” to distribute
his paper, commenting that “in light of this community’s apparent unwillingness to
embrace your ideas, another option may be your consideration of relocation to another
community . . . more willing to embrace your way of thinking.”

       Several days after receiving Felix’s letter, Steele was standing by the sidewalk
in front of the Bemidji Post Office--giving away copies of the Northern Herald, and
wearing a sign that said “FREE -- TODAY ONLY”--when a City police officer
threatened to arrest him for “soliciting.” Steele responded that he was giving, not
selling, the paper; the officer said he would discuss the matter with Felix and then take
Steele “to jail, today” if appropriate. Steele stopped distributing the paper and called
Felix, who concurred with the police officer because distributing the paper from the
sidewalk violated the City’s “obstruction” ordinance (even though Steele had been
holding all of the copies, and had not deposited them on public property). City officials
continued to threaten to arrest Steele if he distributed the paper on public property in
the City without first obtaining the requisite solicitation and obstruction permits.

       Plaintiffs asserted further in their complaint that, after Steele notified City police
of the theft of a stack of complimentary Northern Herald newspapers from a local

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business, the police merely referred the matter to the County Attorney’s Office, which
refused to prosecute the theft; that certain named persons and businesses had disrupted
distribution of the Northern Herald by refusing to sell the paper, by refusing to allow
Steele to leave complimentary copies of it at their businesses, or by threatening to
boycott stores that distributed it; and that business owners had denied service to Steele
at restaurants and bars, a landlord had threatened a tenant (a friend of Steele’s) with
eviction if the tenant continued her relationship with Steele, and a printing press refused
to print the Northern Herald.

      Upon defendants’ motions to dismiss or for summary judgment, the District
Court held that (1) Steele (a non-lawyer) could not represent the Northern Herald in
these proceedings; (2) Steele failed to state a claim against the non-government and
County defendants; and (3) City defendants were entitled to summary judgment
because the City ordinances were constitutional, and because the individual City
defendants were entitled to qualified immunity. See Steele v. City of Bemidji, 114 F.
Supp. 2d 838 (D. Minn. 2000). This appeal followed, in which we review de novo
both the District Court’s grant of the motions to dismiss and its grant of summary
judgment. See Double D Spotting Serv., Inc. v. Supervalu, Inc., 136 F.3d 554, 557
(8th Cir. 1998); Dulany v. Carnahan, 132 F.3d 1234, 1237 (8th Cir. 1997).

       At the outset, we agree with the District Court that Steele may not represent
Northern Herald in federal court. See Knoefler v. United Bank of Bismarck, 20 F.3d
347, 348 (8th Cir. 1994) (non-lawyer has no right to represent another entity in federal
court). Therefore, we will review the District Court’s rulings only as to Steele’s
individual claims. And, although Steele argues on appeal that he should have been
allowed to amend his complaint, he cannot fault the District Court for failing to grant
him leave to amend when he did not seek permission to do so.

       Turning to the merits of Steele’s action, we agree with the District Court that
Steele cannot maintain an action against the non-government defendants under sections

                                            -5-
1983, 1985, or 1986, see Bray v. Alexandria Women’s Health Clinic, 506 U.S. 263,
268-69 (1993) (conspiracy actionable under § 1985 must be motivated by class-based
animus; persons who wish to engage in constitutionally protected conduct are not a
class for § 1985 purposes); Brandon v. Lotter,157 F.3d 537, 539 (8th Cir. 1998) (to be
liable under § 1986, defendant must have neglected or refused to prevent a § 1985
conspiracy); Parker v. Boyer, 93 F.3d 445, 448 (8th Cir. 1996) (§ 1983 redresses only
injuries caused by exercise of some right or privilege created by state, by rule of
conduct imposed by state, or by person for whom state is responsible). We reject
Steele’s argument that the mall is a state actor insofar as it reported Steele’s activities
to the police, see Adickes v. S.H. Kress & Co., 398 U.S. 144, 152 (1970) (to be
considered state actor, private party must have “reached an understanding” with state
officials to deny civil rights and have been “willful participant in joint activity with the
State”). Further, defendants are not liable for the single instance of failing to prosecute
the theft of copies of the Northern Herald. See Monell v. Dep’t of Soc. Servs., 436
U.S. 658, 694 (1978) (municipality is liable under § 1983 only for unconstitutional
custom or policy); Imbler v. Pachtman, 424 U.S. 409, 431 (1976) (absolute immunity
protects prosecutor from damages based on decision not to prosecute).

       Steele also contends, as he did below, that the non-government defendants’
alleged “boycott” is per se illegal under the Sherman Antitrust Act. We disagree. A
boycott is a narrow category of per se violation “limited to cases in which firms with
market power boycott suppliers or customers in order to discourage them from doing
business with a competitor.” See FTC v. Ind. Fed. of Dentists, 476 U.S. 447, 458
(1986). Steele, moreover, has not shown an antitrust injury, see Brunswick Corp. v.
Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 488-89 (1977) (antitrust laws protect
competition, not competitors; private plaintiff must show injury reflecting
anticompetitive effect either of violation or of anticompetitive acts made possible by
violation), and he does not have standing to raise any possible claims by the Northern
Herald in this regard. We also agree with the District Court that the boycott does not
constitute wrongful activity upon which Steele could predicate a state-law claim for

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malicious interference with a business relationship. See Hunt v. Univ. of Minn., 465
N.W.2d 88, 95 (Minn. App. 1991) (claim for interference with prospective business
relationship lies where defendant intentionally committed wrongful act that improperly
interfered with prospective relationship).

       As to Steele’s First Amendment challenge, the parties agree that his claims turn
on the constitutionality of the City ordinances. Section 6.39 prohibits any “peddler,
business solicitor, contribution solicitor . . . or transient merchant” from engaging in
“any such business” without obtaining a permit. To obtain a permit, an applicant must
provide, among other things, his name; date of birth; physical description and
photograph; address; a description of “the nature of the business and goods to be sold”;
the length of time for which the right to do business is desired; two references to certify
the applicant’s “good character,” or other evidence of good character and business
responsibility; a statement of whether the applicant was convicted of any crimes; and
fees as established by the City Council. After conducting any investigation deemed
necessary, the Chief of Police, within five days, must certify that the applicant’s good
character and business reputation is “satisfactory” or state his reasons for denying the
permit. An applicant can appeal the Chief of Police’s denial to the City Council,
although the ordinance does not specify standards for the Council’s review. If the
Chief of Police endorses the application, it is put on the agenda for the City Council’s
consideration at its next meeting. Upon Council approval, the applicant must submit
a $1,000 bond or certified/cashier’s check before receiving a permit. The permit
expires sixty days after issuance.

       Section 10.31 makes it unlawful for anyone to “place, deposit, display or offer
for sale any fence, goods or other obstructions upon, over, across or under any public
property without first having obtained a written permit from the Council.” Before
granting any permit, the Council “may impose such insurance or bonding conditions
thereon as it, considering the projected danger to public or private property or to

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persons, deems proper.” The ordinance does not specify how soon the Council must
consider a permit application, nor does it state the duration of the permit.

       Neither ordinance on its face proscribes giving away newspapers that the donor
is holding while standing on a City sidewalk. Nevertheless, the City has applied, and
apparently wants to continue to apply, the ordinances to Steele, whether or not he
attempts to sell his newspapers and whether or not he places them on City property.
The City’s permit schemes are prior restraints on protected speech, but the City
argues--and the District Court agreed--that they are constitutional as valid time, place,
and manner restrictions. See Ward v. Rock Against Racism, 491 U.S. 781, 791 (1989)
(government may impose content-neutral time, place, or manner restrictions so long as
they are narrowly tailored to serve significant government interest and leave open
ample alternative channels for expression). But in our view, several salient features of
the permit schemes run afoul of the First Amendment.

       First, the permit schemes vest the City Council with too much discretion to
discriminate against disfavored speech or unpopular speakers. See City of Lakewood
v. Plain Dealer Pub. Co., 486 U.S. 750, 755-59 (1988) (licensing scheme giving
government unlimited discretion is facially unconstitutional; mere existence of such
discretion, combined with power of prior restraint, intimidates speakers into censoring
themselves even if discretion and power are never actually abused); Shuttlesworth v.
City of Birmingham, 394 U.S. 147, 149-50 (1969) (invalidating ordinance requiring city
commission to issue permit unless in “its judgment the public welfare, peace, safety,
health, decency, good order, morals or convenience required that it be refused”). Also
problematic is the solicitation permit’s duration of only sixty days: a person might well
be reluctant to distribute a newspaper criticizing a city council that has the unfettered
discretion every two months to deny the person’s right to distribute his product in
public. See Lakewood, 486 U.S. at 758 (expressing similar concerns about city’s year-
long newsrack permits). Morever, the solicitation ordinance allows the Chief of Police
to deny any permit application under the vague ground that the applicant is not of

                                           -8-
“good character and business reputation.” See Staub v. City of Baxley, 355 U.S. 313,
321 (1958) (invalidating ordinance because of unfettered discretion granted mayor, who
was empowered to deny permits to applicants requesting permission to solicit others
to join their organization, based on “the character of the applicant, the nature of the
business of the organization for which members are desired to be solicited, and its
effects upon the general welfare of citizens of the City of Baxley”); Schneider v. State
of New Jersey, Town of Irvington, 308 U.S. 147 (1939) (invalidating ordinance
allowing police chief to deny permit to door-to-door solicitor if he determined applicant
was “not of good character”).

        Second, section 6.39 requires a $1,000 bond or certified check before the
applicant can receive a solicitation permit, and a section 10.31 obstruction permit is
subject to “such insurance or bonding conditions” as the City Council may impose
“considering the projected danger to public or private property or to persons.” In this
regard, Felix’s letter stated that Steele would need “a substantial bond” and “public
liability coverage with policy limits equal to those required of the City.” These
requirements cannot be imposed as a prior restraint on protected speech. See Forsyth
County, Ga. v. Nationalist Movement, 505 U.S. 123, 133 (1992) (parade fee of “up to
one thousand dollars for each day” was unconstitutional because ordinance did not
articulate any standards for fixing amount of permit fee and allowed administrator to
examine content of prospective speaker’s message in assessing fee); cf. Murdock v.
Commonwealth of Pennsylvania, 319 U.S. 105, 113-14 (1943) (ordinance charging flat
fee per day for license to canvass or solicit was unconstitutional because “the license
tax [wa]s fixed in amount and unrelated to the scope of the activities of petitioners or
their realized revenues”).

       Third, neither ordinance imposes a time limit on the City Council’s decision to
grant or deny a permit. See Riley v. Nat’l Fed’n of the Blind of N.C., Inc., 487 U.S.
781, 802 (1988) (regulation prohibiting speech until speaker obtains license must

                                           -9-
provide that licensor will “within a specified brief period, either issue a license or go
to court”) (citation and internal quotation omitted).

       Accordingly, we reverse the District Court’s grant of summary judgment as to
Steele’s First Amendment claims against the City defendants. We leave the question
of qualified immunity to the District Court on remand. In all other respects, we affirm
the judgment of the District Court.

      A true copy.

             Attest:

                     CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.

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