NYC’s Billboard Restrictions Upheld

The Second Circuit Court of Appeals upheld certain provisions of the New York City Zoning Resolution which, the plaintiff-appellants argued, imposed unconstitutional restrictions on commercial speech. 

The main plaintiffs in this case were Clear Channel Outdoor Inc., which owns and operates large billboards throughout New York City, including along the City’s arterial highways, and Metro Fuel, LLC, which owns and operates smaller illuminated “panel” advertising signs which are placed throughout the City.

The Clear Channel appellants were challenging New York City’s ban on offsite advertising signs within 200 feet (and within sight) of arterial highways in commercial and manufacturing zoned districts.  They also challenged the City’s enforcement scheme, which requires certain registration and documentation in order for an outdoor advertising company to demonstrate that its billboards should be accorded non-conforming use status.  Metro Fuel was challenging the City’s regulation of where it could place its panel advertising signs, and how those signs could be illuminated.

Appellants argued that the City’s previously lax enforcement of the sections of the zoning resolution at issue, as well as “loopholes and inconsistencies in the regulatory regime” prevented the City from advancing a substantial government interest, thereby rending the regulations invalid as an unconstitutional prohibition of commercial speech. 

Specifically, the Clear Channel appellants argued that the City’s history of sporadic enforcement of its signage regulations undermines the validity of those regulations, and that in enforcing its offsite advertising ban on private property, but permitting similar signs on government property, the City was impermissibly prohibiting Clear Channel’s commercial speech.  The Clear Channel appellants also called the Court’s attention to the City’s admitted failure to enforce the regulatory scheme on signs located on property owned by the Metropolitan Transit Authority.  Finally, appellants disputed the validity of the City’s justification for the restrictions, namely the promotion of traffic safety and aesthetics.  The Metro Fuel appellants alleged that the City’s street furniture franchise, which allows for panel advertisements on bus shelters similar to those that Metro Fuel owns and operates, is an exception which renders the City’s regulation of Metro Fuel’s own signs unconstitutional. 

Noting that the speech at issue in this case was commercial, and neither unlawful nor misleading, the Second Circuit applied the Central Hudson test to determine whether the City’s signage restrictions were constitutional.  Central Hudson requires that a governmental entity that wishes to regulate protected commercial speech must “assert a substantial interest to be achieved” by the restriction.  The restrictions must “directly advance the state interest involved” and it may not be “more extensive than is necessary to serve that interest.”  Supreme Court jurisprudence makes clear that the burden of establishing “a reasonable fit between the [regulatory scheme’s] ends and the means chosen to accomplish those ends” rests with the City. 

The Second Circuit recalled the Supreme Court’s holding in Metromedia which established that the goals of protecting the aesthetic appearance of a municipality and maintaining traffic safety are substantial government interests.  The Court also stressed that the City is not required to adopt the least restrictive means when regulating commercial billboards, but must only ensure that “the regulation not burden substantially more speech than is necessary to further the government’s legitimate interests.”  Because the Court found the City’s determination about how to regulate outdoor commercial advertising reasonable, it deferred to that determination, noting that “it is not [the] Court’s role to second guess the City’s urban planning decisions.”
The Court rejected appellants’ claims that the regulations are underinclusive, and therefore not an adequate “fit” as required by the Central Hudson test, and held that “it is clear that, despite its exceptions, New York City’s Zoning Resolution directly advances its interests in traffic safety and aesthetics” and that “exceptions to the Zoning Resolution do not render the scheme unconstitutional.” 

Appellants argued that the criteria set forth by the city for demonstrating that a sign is a lawful non-conforming use do not advance its interests and were, therefore, unconstitutional.  The Court rejected that argument, noting “the outdoor advertising industry’s history of non-compliance with zoning regulations” and held that “the registration and documentation requirements are narrowly tailored and not more extensive than necessary to aid the City in its enforcement efforts.” 

The Court also held that the Southern District’s rejection of the plaintiffs’ New York State Constitutional Challenges was proper, noting that Court of Appeals has explicitly invoked the Central Hudson test in evaluating restrictions on commercial speech. 

Clear Channel Outdoor, Inc. v City of New York, 2010 WL 367550 (2^nd Cir. (NY) 2/3/2010).

The opinion can be accessed here

Thanks to David Schakenberg of the Municipal Arts Society to sending this summary along.