Court Opinion

ID: 2996322
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:27:32.621382+00
Date Added: 2024-06-11T11:45:29.375424
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 02-1909
FEDERATION OF ADVERTISING INDUSTRY
REPRESENTATIVES, INC., an Illinois
not-for-profit corporation,
                                   Plaintiff-Appellant,
                            v.

CITY OF CHICAGO,
                                              Defendant-Appellee.
                          ____________
            Appeal from the United States District Court
       for the Northern District of Illinois, Eastern Division.
          No. 97 C 7619—Matthew F. Kennelly, Judge.
                          ____________
    ARGUED JANUARY 10, 2003—DECIDED APRIL 25, 2003
                    ____________

 Before EASTERBROOK, MANION, and KANNE, Circuit
Judges.
  KANNE, Circuit Judge. This case concerns a continu-
ing litigation involving a now-repealed Chicago city ordi-
nance. The district court held that repeal of the ordinance
ended the ongoing controversy and rendered the case
moot. The district court also found that the plaintiff was
not entitled to attorney’s fees. For the reasons set out be-
low, we affirm.
2                                                  No. 02-1909

                          I. History
  In September 1997, the Chicago City Council passed an
ordinance prohibiting the placement of alcohol and ciga-
rette advertisements in “publicly visible places,” defined
as outdoor billboards, sides of buildings, and freestanding
signboards. The ordinance contained numerous excep-
tions allowing such advertisements in commercial zones,
manufacturing zones, and other locations. Also included
in the ordinance was a “grandfather” clause, which honored
advertising contracts entered into before the effective
date of the ordinance. The grandfather clause was re-
moved, however, when the City learned that advertisers,
relying on the clause, had entered into multiple new con-
tracts and that these new contracts would essentially
undermine the purpose of the ordinance.
  Federation of Advertising Industry Representatives, Inc.,
an association of companies that displays advertisements
for various products including cigarettes and alcohol, filed
suit against the City, alleging that the ordinance violated
the First Amendment and was preempted by both federal
and state statutes.1 In its complaint, Federation sought
injunctive and declaratory relief, and made a claim for
damages and attorney’s fees.
  In July 1998, Federation moved for summary judgment
on its First Amendment and preemption claims. The dis-
trict court granted the motion with respect to the preemp-
tion claim,2 holding that the portions of the ordinance
relating to cigarette advertising were preempted by § 5(b)

1
 Federation also added a federal Contracts Clause claim, U.S.
CONST. art. I, § 10, when the City amended the ordinance to re-
move the grandfather clause.
2
  The district court did not rule on the First Amendment claim
at this time, holding that motion in abeyance while it determined
the preemption issue.
No. 02-1909                                                    3

of the Federal Cigarette Labeling and Advertising Act
(“FCLAA”), 15 U.S.C. § 1334(b),3 and that the portions re-
lating to alcohol advertising were not severable. Fed’n of
Adver. Indus. Rep., Inc. v. City of Chicago, 12 F. Supp. 2d
844, 853 (N.D. Ill. 1998). The district court awarded Fed-
eration declaratory and injunctive relief, but denied the
claim for damages, stating that Federation had presented
no evidence that it had suffered damages. Also, in a later
order, the district court, pursuant to 42 U.S.C. § 1988,
awarded Federation attorney’s fees in excess of $400,000
and nontaxable expenses of nearly $15,000.
   The City appealed the grant of summary judgment and
the award of attorney’s fees, but Federation did not ap-
peal the district court’s denial of its damages claim. In that
first appeal, we reversed the district court’s ruling that
the FCLAA preempted all parts of the ordinance regulat-
ing cigarette advertising, finding instead that only a
small exception in the ordinance allowing advertising
of generic, as opposed to brand specific, tobacco products
was preempted.4 Fed’n of Adver. Indus. Rep., Inc. v. City of
Chicago, 189 F.3d 633, 639-40 (7th Cir. 1999). This pre-
empted portion, we held, was severable from the balance
of the statute; thus, we reversed the district court’s deci-
sion that the ordinance was invalid in its entirety and

3
   This section provides: “No requirement or prohibition based
on smoking and health shall be imposed under State law with
respect to the advertising or promotion of any cigarettes the
packages of which are labeled in conformity with the provisions
of this Chapter.” 15 U.S.A. § 1334(b) (2003).
4
  This holding was based on the fact that we found the ordinance
to be basically a land-use regulation that did not interfere with
the FCLAA’s advertising and labeling requirements. We held
that the exception relating to generic tobacco advertising was
preempted, however, because it regulated without regard to
any land-use consideration. Federation, 189 F.3d at 639-40.
4                                                No. 02-1909

affirmed that decision only as it related to the exception for
generic tobacco advertising. Id. at 640. We remanded for
further proceedings consistent with our opinion. Id.
  On November 1, 2000, the City amended the ordinance
to remove the preempted exception and to remove sev-
eral other exceptions, the constitutionality of which had
been called into question by the Supreme Court decision
in Greater New Orleans Broad. Ass’n v. United States, 527
U.S. 173 (1999). Subsequently, Federation amended its
complaint to drop the preemption claim and to eliminate
entirely its challenge to the cigarette-advertising por-
tions of the ordinance.
  On June 5, 2001, Federation moved for summary judg-
ment on the First Amendment grounds, arguing that
the ordinance’s regulation of alcohol advertising was an
invalid content-based regulation on noncommercial speech,
and in the alternative, that the ordinance was an invalid
restriction of commercial speech. Before the City filed
a response, the Supreme Court decided Lorillard Tobacco
Co. v. Reilly, 533 U.S. 525 (2001), which held that a Massa-
chusetts statute, similar to the statute in this case, was
preempted by the FCLAA and violated the First Amend-
ment. Id. at 551, 561.
  Federation filed a supplemental brief arguing that
Lorillard required the district court to grant its motion
for summary judgment. The City did not respond to the
merits of Federation’s summary judgment motion, but
rather on September 13, 2001, filed a cross motion to
dismiss based on mootness, citing the City’s intention to
repeal the ordinance in light of Lorillard and noting that
since no damages claim remained, repeal would provide
Federation full relief and end the controversy. The City
did not concede the unconstitutionality of its ordinance,
which it contended was materially different from the
ordinance at issue in Lorillard; rather, it stated that the
No. 02-1909                                               5

risks of going forward in light of Lorillard had persuaded
it to repeal the ordinance. On October 31, 2001, the City
Council repealed the ordinance, and a week later the
district court granted the City’s motion to dismiss, finding
that the repeal of the ordinance had rendered the case
moot.
  Subsequently, Federation filed a motion for rehearing,
on the grounds that it was a “prevailing party” and there-
fore entitled to reasonable attorney’s fees under 42 U.S.C.
§ 1988. The district court denied the motion, reaffirming
its decision on mootness and finding that Federation
was not entitled to attorney’s fees because it was not a
“prevailing party” under the statute, as interpreted by
the Supreme Court in Buckhannon Board & Care Home,
Inc. v. W. Va. Dep’t. of Health and Human Res., 532 U.S.
598, 600 (2001). Federation now appeals the district
court’s rulings on both mootness and attorney’s fees.

                       II. Analysis
A. Mootness
   Whether a case has been rendered moot is a question of
law that we review de novo. Higgason v. Farley, 83 F.3d
807, 811 (7th Cir. 1996). Under Article III of the Constitu-
tion, as interpreted by the courts, cases that do not in-
volve “actual, ongoing controversies” are moot and must
be dismissed for lack of jurisdiction. Stotts v. Cmty. Unit
Sch. Dist. No. 1, 230 F.3d 989, 990-91 (7th Cir. 2000). A
question of mootness arises when, as here, a challenged
ordinance is repealed during the pendency of litigation, and
a plaintiff seeks only prospective relief. Rembert v.
Sheahan, 62 F.3d 937, 940 (7th Cir. 1995).
  We begin with Federation’s argument that this case is
not moot because in addition to declaratory and injunc-
tive relief, it sought damages in its complaint. We recog-
6                                                No. 02-1909

nize that a defendant’s change in conduct cannot render
a case moot so long as the plaintiff makes a claim for
damages. Buckhannon, 532 U.S. at 608-09. However, no
damage claim remains in this case. In the original district
court ruling, which granted Federation’s motion for sum-
mary judgment, the court explicitly denied Federation’s
claim for damages, holding that no evidence had been
submitted to support the claim. See Federation, 12 F. Supp.
2d at 854. This was a final ruling by the district court,
which Federation did not appeal. “Under the doctrine of
the law of the case, a ruling by the trial court, in an ear-
lier stage of the case, that could have been but was not
challenged on appeal is binding in subsequent stages of
the case.” Schering Corp. v. Ill. Antibiotics Co., 89 F.3d 357,
358 (7th Cir. 1996). Thus, Federation is precluded from
resurrecting its damages claim and at this stage may only
seek injunctive and declaratory relief.
  Federation next argues that this case presents a live
controversy because, though the City has repealed the
challenged ordinance, the City remains free to reenact it
at any time. In support of this argument, Federation
cites the general principle that a defendant’s voluntarily
cessation of challenged conduct will not render a case
moot because the defendant remains “free to return to his
old ways.” United States v. W. T. Grant Co., 345 U.S. 629,
632-33 (1953).
  We do not dispute that this proposition is the appro-
priate standard for cases between private parties, but this
is not the view we have taken toward acts of voluntary
cessation by government officials. Rather, “[w]hen the
defendants are public officials . . . we place greater stock
in their acts of self-correction, so long as they appear
genuine.” Magnuson v. City of Hickory Hills, 933 F.2d 562,
565 (7th Cir. 1991); see also Ragsdale v. Turnock, 841 F.2d
1358, 1365 (7th Cir. 1988) (“We note additionally that
cessation of the allegedly illegal conduct by government
No. 02-1909                                                   7

officials has been treated with more solicitude by the
courts than similar action by private parties.”) (citing
13A WRIGHT ET AL., FEDERAL PRACTICE AND PROCEDURE
§ 3533.7, at 353 (2d ed. 1984). To adopt Federation’s view
that mere repeal is insufficient to moot a case would
essentially put this court in the position of presuming
that the City has acted in bad faith—harboring hidden
motives to reenact the statute after we have dismissed
the case—something we ordinarily do not presume. See
generally N.E. Fla. Chapter of the Assoc. Gen. Contractors
of Am. v. City of Jacksonville, 508 U.S. 656, 677 (1993)
(O’Connor, J., dissenting); Michael Ashton, Note, Recovering
Attorney’s Fees with the Voluntary Cessation Exception
to Mootness Doctrine After Buckhannon Board and Care
Home, Inc. v. West Virginia Department of Health and
Human Resources, 2002 WIS. L. REV. 965.
  Rather than presuming bad faith, we have repeatedly
held that the complete repeal of a challenged law renders
a case moot, unless there is evidence creating a reason-
able expectation that the City will reenact the ordinance
or one substantially similar. See, e.g., Rembert, 62 F.3d
at 940; Thomas v. Fielder, 884 F.2d 990, 995 (7th Cir. 1989).
   This rule does not, as Federation suggests, conflict with
Supreme Court precedent on the issue. In a string of cases,
the Court has upheld the general rule that repeal, expira-
tion, or significant amendment to challenged legislation
ends the ongoing controversy and renders moot a plain-
tiff’s request for injunctive relief. See, e.g., Lewis v. Cont’l
Bank Corp., 494 U.S. 472, 474 (1990); Mass. v. Oakes, 491
U.S. 576, 582-83 (1989); Princeton Univ. v. Schmid, 455
U.S. 100, 103 (1982); Kremens v. Bartley, 431 U.S. 119, 128-
29 (1977); Diffenderfer v. Cent. Baptist Church, Inc., 404
U.S. 412, 415 (1972).
 Only in cases where there is evidence that the repeal
was not genuine has the Court refused to hold the case
8                                                    No. 02-1909

moot. For instance, in City of Mesquite v. Aladdin’s Castle,
though the City had repealed the challenged ordinance, the
Court declined to find the case moot because the City
had announced to the Court its intention to reenact the
challenged provision if the case was dismissed. 455 U.S.
283, 289 n.11 (1982).5 Similarly, in Northeastern Florida,
the Court held that repeal did not moot the case be-
cause the City had already replaced the repealed ordinance
with one that was substantially similar, causing the
Court to note that “[t]here is no mere risk that Jackson-
ville will repeat its allegedly wrongful conduct; it has
already done so.” 508 U.S. 656, 662 (1993).6
   Therefore, we, along with all the circuits to address the
issue, have interpreted Supreme Court precedent to sup-
port the rule that repeal of a contested ordinance moots
a plaintiff’s injunction request, absent evidence that the

5
   We recognize that some language in the Aladdin’s Castle
majority opinion perhaps suggests that mere repeal of a chal-
lenged statute does not moot a case. But in light of both previous
and subsequent cases, we find this language to be dicta and
therefore not controlling. Further supporting this conclusion
is Justice White’s Aladdin’s Castle concurrence wherein he noted
that the City of Mesquite’s announced intention to reenact the
challenged ordinance distinguished Aladdin’s Castle from prior
cases where the Court had held that repeal moots a statutory
challenge. Id. at 296 n. (White, J., concurring in part, dissenting
in part). Aladdin’s Castle, therefore, was reconcilable with those
prior cases.
6
  Consistent with our belief that Northeastern Florida and
Aladdin’s Castle represent only an exception to the general rule,
the Northeastern Florida majority noted that what separated its
holding from those in Diffenderfer and similar cases was that
in the prior cases there was “no basis for concluding that the
challenged conduct was being repeated,” whereas in Northeastern
Florida the City had already reenacted a similar statute. Id.
at 662 n.3.
No. 02-1909                                                       9

City plans to or already has reenacted the challenged
law or one substantially similar.7 Consequently, the issue

7
   See Citizens for Responsible Gov’t v. Davidson, 236 F.3d 1174,
1182 (10th Cir. 2000) (“In general, the repeal of a challenged
statute is one of those events that makes it absolutely clear that
the allegedly wrongful behavior—here the threat of prosecu-
tion under one of the repealed sections—could not reasonably
be expected to recur.”) (quotations omitted); D.H.L. Assoc. v.
O’Gorman, 199 F.3d 50, 55 (1st Cir. 1999) (finding that
Diffenderfer established the general rule that repeal of a statute
moots a case, and that Aladdin’s Castle and Northeastern Florida
created an exception to this rule that only applied “when there
is a reasonable expectation that the challenged conduct will be
repeated following dismissal of the case”); Nat’l Black Police
Assoc. v. Dist. of Columbia, 108 F.3d 346, 349 (D.C. Cir. 1997)
(“Although voluntary cessation analysis applies where a challenge
to government action is mooted by passage of legislation, the mere
power to reenact a challenged law is not a sufficient basis on
which a court can conclude that a reasonable expectation of re-
currence exists. Rather, there must be evidence indicating that
the challenged law likely will be reenacted.”); Ky. Right to Life,
Inc. v. Terry, 108 F.3d 637, 645 (6th Cir. 1997) (holding that
amendment to the challenged statute mooted the claim when the
state had expressed no intention to reenact the prior law) ; Native
Village of Noatak v. Blatchford, 38 F.3d 1505, 1510 (9th Cir. 1994)
(“As a general rule, if a challenged law is repealed or expires, the
case becomes moot” except where “it is virtually certain that the
repealed law will be reenacted.”); Assoc. Gen. Contractors of
Conn., Inc. v. City of New Haven, 41 F.3d 62, 66 (2d Cir. 1994)
(holding the Aladdin’s Castle exception to the mootness rule
inapplicable because the City of New Haven had not reenacted
the challenged legislation and the court did not foresee that it
would); see also ERWIN CHEMERINSKY, FEDERAL JURISDICTION
§ 2.5, at 139 (3d. ed. 1999) (concluding after reviewing relevant
Supreme Court cases that “[t]he difficulty is determining why
in some situations a legislative repeal is deemed to make a case
moot, yet in other cases it does not . . . . The key appears to be
                                                      (continued...)
10                                                 No. 02-1909

here is whether there is any evidence that the City of
Chicago’s repeal was disingenuous; that is, evidence that
the City will reenact the challenged ordinance or one
substantially similar.
  Federation essentially makes two arguments on this
front, neither of which we find persuasive. First, Federation
contends that the City has engaged in a disingenuous
game of “constitutional cat and mouse.” Thomas, 884 F.2d
at 995. According to Federation, the fact that the City
twice amended this ordinance and finally repealed it,
demonstrates the City’s determination to evade constitu-
tional limits on its power and therefore is evidence that
it will reenact the ordinance if we dismiss this case. We
disagree with Federation’s characterization of the City’s
actions as disingenuous; rather, they just as likely reveal
the City’s good-faith attempts to initially maintain an
effective ordinance that complies with the Constitution,
and then its desire to avoid substantial litigation costs
by removing a potentially unconstitutional law from the
books. For instance, the second amendment to the ordi-
nance, which removed various exceptions, came partially
in response to our decision that one of the exceptions
was preempted by the FCLAA and partially in response
to the Supreme Court decision in Greater New Orleans
Broad. Ass’n v. United States, 527 U.S. 173 (1999), which
moved the City to question the constitutionality of an
exception-laden ordinance. We can hardly fault the City
for its attempts to craft an ordinance that passes con-
stitutional muster and complies with judicial decisions.
Thomas, 884 F.2d at 995. Finally, the City candidly ad-
mits that the Lorillard decision persuaded it to repeal

7
   (...continued)
that cases will not be dismissed as moot if the Court believes
that there is a likelihood of reenactment of a substantially sim-
ilar law if the lawsuit is dismissed”).
No. 02-1909                                               11

the ordinance because of the risk of losing in the litiga-
tion. We find that the City’s actions over the course of this
litigation do not give rise to an expectation that it will
reenact the challenged ordinance.
  Second, Federation argues that the proposal of another
sign-restricting ordinance in the City Council creates a
reasonable expectation that the City will return to its old
ways. While the record reveals that another law has been
proposed, it is of a significantly different character than
the repealed ordinance. Unlike the repealed ordinance,
which restricted only cigarette and alcohol advertise-
ments, the newly proposed law does not regulate on the
basis of content, but rather would allow the City Council
to create sign-free districts where no advertising signs
could be displayed at all, whether they be for alcohol,
cigarettes, soft drinks, or whatever. The majority opinion in
Northeastern Florida made it clear that where a chal-
lenged statute is replaced by one that would create a
“substantially different controversy,” then the new statute
provides “no basis for concluding that the challenged
conduct [will be] repeated.” Northeastern Florida, 508
U.S. at 662 n.3. The proposed ordinance, a content-neutral
prohibition, would create a substantially different con-
troversy than the repealed ordinance, which was funda-
mentally a content-based prohibition.
  Moreover, the fact that this is only a proposed ordinance
is not insignificant. We have no way of knowing the likeli-
hood that this ordinance will actually be enacted. Therefore,
it presents a quite different case than either Aladdin’s
Castle—where the City explicitly informed the Court that
it would reenact the repealed law, 455 U.S. at 289 &
n.11—or Northeastern Florida—where the City had al-
ready enacted a substantially similar ordinance, 508 U.S.
at 662.
  Because the City has repealed the challenged ordinance
and because we find no evidence in the record creating a
12                                                  No. 02-1909

reasonable expectation that the City will reenact that
ordinance, we affirm the district court’s holding that
this case is moot.

    B. Attorney’s Fees
  Federation claims attorney’s fees under 42 U.S.C. § 1988,
which provides to “the prevailing party . . . a reasonable
attorney’s fee.” The district court below held that Federa-
tion was not a “prevailing party” under the statute and
therefore denied Federation’s claim. Although the decision
to award attorney’s fees under § 1988 lies within the
district court’s discretion, when, as here, the district
court’s denial of an attorney’s fee award rests on the
application of a principle of law, our review is de novo.
Jaffee v. Redmond, 142 F.3d 409, 412-13 (7th Cir. 1998).
  In Buckhannon, the Supreme Court rejected as a basis
for awarding attorney’s fees the “catalyst theory,” which
deemed the “plaintiff a ‘prevailing party’ if it achieves
the desired result because the lawsuit brought about a
voluntary change in the defendant’s conduct.” 532 U.S. at
600-01. Instead, the Court held that the term “prevailing
party,” as used in various federal statutes,8 includes only
those parties who have obtained a “judicially sanctioned
change” in the legal relationship of the parties. Id. at 605.
As examples of the sort of “judicially sanctioned change”
required, the Court cited an enforceable judgement on
the merits or a court-ordered consent decree. Id. at 602.

8
  The Buckhannon case involved the term “prevailing party” as
used in the Fair Housing Amendments Act of 1988, 42 U.S.C.
§ 3613(c)(2) and the Americans with Disabilities Act of 1990, 42
U.S.C. § 12205. But the Court made abundantly clear that its
ruling would apply as well to the term as used in the Civil Rights
Attorney’s Fees Award Act of 1976, 42 U.S.C. § 1988. Buckhan-
non, 532 U.S. at 602-03 & n.4.
No. 02-1909                                               13

Federation has not obtained an enforceable judgment on
the merits, a court-ordered consent decree, or anything
else that might be classified as “some relief by the court.”
Id. at 603. Thus, Buckhannon mandates we find that Fed-
eration is not a “prevailing party” in this litigation.
   Attempting to avoid the application of Buckhannon,
Federation argues that its position in this case has been
marked with a sufficient “judicial imprimatur” to qualify
it as a prevailing party. Id. at 605. Federation first points
to the fact that the district court originally granted its
motion for summary judgment. But we reversed the core
holding of that decision. Federation, 189 F.3d at 639-40.
Obtaining a favorable judgment that is reversed on appeal
does not entitle a plaintiff to prevailing-party status.
Federation notes that we affirmed a portion of the original
district court decision. Id. at 640. But our holding only
affirmed the small portion of the decision that found that
an exception in the ordinance was preempted by the
FCLAA. The relief sought by Federation was far broader
than that which we upheld. It sought not the elimina-
tion of merely this exception, but rather the elimination
of the entire ordinance. In fact, our holding that the ge-
neric advertising exception was preempted actually did
not provide Federation any relief at all; rather, it fur-
ther limited Federation’s ability to advertise. Therefore,
the fact that we affirmed this portion of the original dis-
trict court decision certainly does not make Federation
a prevailing party. See generally Cady v. City of Chicago, 43
F.3d 326, 329 (7th Cir. 1994) (holding that even under
the catalyst theory, a plaintiff is not a prevailing party
unless he obtains the relief sought or at least relief that
is directly beneficial to him).
  Federation also tries to characterize itself as a prevail-
ing party based on the fact that the City’s repeal of the
ordinance was not voluntary. According to Federation,
repeal was brought about by the combination of the Su-
14                                               No. 02-1909

preme Court’s decision in Lorillard and its own motion
for summary judgment that was pending when Lorillard
was decided. Assuming for the sake of argument that
Federation’s characterization of the City’s reasons for
repealing its ordinance is correct, Buckhannon still would
prevent us from finding that Federation is a prevailing
party. For even if we accept that Lorillard controls the
merits of Federation’s claim, neither Federation nor the
City were parties to that case. In other words, Lorillard
may support Federation’s position, but it was not a judg-
ment that changed the legal relationship between the
parties in this case—and that is what Buckhannon requires.
See Buckhannon, 532 U.S. at 605.
  Nor does the fact that Federation had a summary judg-
ment motion pending provide the necessary judicially
sanctioned change. Even assuming that after Lorillard, the
district court would have granted Federation’s motion had
the City not repealed its ordinance, the fact remains that no
such ruling was made and thus no judicial relief was
awarded to Federation. Federation lays blame on the
district court for not ruling on the summary judgment
motion before the City could repeal its ordinance, but we
see no error in the judge not ruling as quickly as Federation
might have liked, especially in light of the fact that Federa-
tion did not move for expedited review.
  The fact remains that Federation did not obtain a
“judicially sanctioned change in the legal relationship of
the parties,” and thus under Buckhannon, it cannot be
deemed a prevailing party. Consequently, we affirm the
district court’s denial of Federation’s claim for attorney’s
fees.

                     III. Conclusion
  For the foregoing reasons, the district court’s decision
that this case is moot and that Federation is not entitled
to attorney’s fees is AFFIRMED.
No. 02-1909                                         15

A true Copy:
      Teste:

                    ________________________________
                    Clerk of the United States Court of
                      Appeals for the Seventh Circuit

               USCA-02-C-0072—4-25-03