Posted by: Patricia Salkin | February 27, 2008

6th Circuit Upholds Ordinance Barring Entertainers from Entering Areas of Adult Establishment Within One Hour of Semi-Nude Performance

Kenton County, Kentucky enacted a licensing ordinance regulating sexually oriented businesses within the County for the purpose of reducing prostitution.  It requires that sexually oriented business, along with their managers and entertainers, obtain licenses from the County.  Businesses are required to pay $3,000 to secure a license, of which $1,500 is refundable if they are denied a license.  Entertainers and managers must pay $155 for a license, none of which is refundable if they are denied a license.  The ordinance requires entertainers to maintain a minimum distance of five feet from areas on the establishment’s premises being occupied by customers for at least an hour following the time when the entertainer appears semi-nude on stage.   The plaintiffs, sexually oriented businesses and their employees, challenged the ordinance claiming, among other things, that it violates the First Amendment by barring entertainers from entering areas of an establishment occupied by customers within one hour of the entertainer’s performing semi-nude on stage.  They also claimed that the ordinance violates the Contracts Clause of Art. 1, sec. 10 of the Constitution, that the judicial review provisions in the ordinance do not satisfy the First Amendment prompt judicial review requirements, and that the license fees are excessive. 

The 6th Circuit Court of Appeals upheld the Ordinance against the first three claims and vacated and remanded for further proceedings the fourth challenge.  The Court noted that prostitution is a “secondary effect” of sexually oriented business and that therefore the appropriate standard of review is intermediate scrutiny under United States v. O’Brien, 391 U.S. 367 (1968) since the government’s regulation is unrelated to the speech content.  To survive intermediate scrutiny, the government: 1) must have had the actual purpose of suppressing secondary effects when it enacted the law; 2) must have had a reasonable evidentiary basis for concluding that the regulation would have the desired effect; and 3) must leave the quantity and accessibility of speech substantially intact. As to the first prong, the Court found no doubt that the County sought to target prostitution.  The second prong was also satisfied as the Court noted that the County hired consultants who made first-hand observations about the presence of prostitution and other harms in the sexually oriented establishments within the County, and the County relied on evidence from other jurisdictions as well as first hand evidence from police officers. The County believed, therefore, that the ordinance was reasonably relevant to solving the illicit sexual contact and prostitution observed in these business establishments. The Court determined that the ordinance seems reasonably designed to reduce prostitution. As to the third prong, the Court determined that quantity and accessibility of speech was left intact because it only restricts those dancers performing on a particular night and it only restricts them for an hour after their performances. Furthermore, the provision does not bar communication itself, rather it bans physical presence in a particular area of a particular length of time. The Court noted that entertainers could converse with patrons from more than five feet away, and that they could communicate via cellular phone, closed circuit television or electronic chat. The regulation only affects comingling in a particular place and only for a particular time. The Court concluded that all three prongs of intermediate scrutiny were satisfied.  The Court also determined that the Ordinance did not violate the Contracts Clause of the Constitution because the plaintiffs could not show that any settlement agreement between them and the City of Covington was substantially impaired. The Court noted that Kentucky law is clear that a valid county ordinance trumps city ordinances in cases such as this.  

With respect to the Plaintiffs’ claim that the ordinance provisions do not provide sufficiently prompt judicial review, the Court determined that the ordinance allowed both licensees and applicants to operate during the pendency of administrative and judicial proceedings, and that the ordinance preserves the status quo on every relevant respect during the pendency of a license application and during the various penalty proceedings.  The Court concluded that the Ordinance satisfies the First Amendment.   

In addressing the issue of fees, the Court noted that the Supreme Court has never enunciated a comprehensive approach to the constitutionality of a licensing fee charged for the exercise of First Amendment rights.  The Sixth Circuit enunciated a three-part test to review the constitutionality of fees where secondary effects are involved: 1) whether the fee’s maximum amount will deter the exercise of First Amendment rights; 2) whether the measures the cost of which the County seeks to transfer to licensees via its fee structures are narrowly tailored means of advancing the County’s interest in curbing secondary effects, and 3) whether the County’s cost estimates for those measures are reasonable. Since the District Court did not undertake this inquiry, the Court vacated this ground of the lower court decision and remanded this issue for further proceedings.    

729, Inc. v. Kenton County Fiscal Court, 2008 WL 313054 (C.A. 6, Ky, 2/6/2008).    

The opinion can also be accessed at:

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