11th Cir. Court of Appeals Finds City’s Licensing Regulations were Reasonably Designed to Reduce the Negative Secondary Effects Associated with Sexually Oriented Businesses

Appellants Cornell Restaurant Ventures, LLC; MJP & JCW, Inc.; Jilco, Inc.; and MRG of South Florida, Inc. were the owners and operators of the adult-entertainment clubs known as “Pure Platinum” and “Solid Gold,” appealed the district court’s grant of summary judgment to the City of Oakland Park on the Owners’ complaint challenging the City’s sexually oriented business licensing regulations. On appeal, the Owners alleged that the enforcement of the licensing regulations against Pure Platinum was barred by a permanent injunction entered by a United States district court in 1987; and there was a genuine issue of material fact as to whether the regulations violated the First Amendment.

According to the Owners, the 1987 injunction “enjoined the City of Oakland Park from prohibiting the operation of a ‘Group D Cabaret,’ which included non-obscene nude dancing” and the sale and consumption of alcoholic beverages. Specifically, since the licensing regulations prohibited full nudity and alcohol, the Owners alleged that forcing them to comply violated their rights under the 1987 injunction. The court found, however, that the “right” created by the 1987 injunction was narrower in scope, and only provided that the establishment be protected from enforcement of the 1977 zoning regulations contained in § 24-28A.2 of the Oakland Park Code based on the zoning regulations’ grandfather clause: prohibiting strip clubs from operating within 1,000 feet of a school. Accordingly, the court found that the 1987 injunction had no force with respect to the licensing regulations at issue.

Owners next argued that there were genuine issues of material fact regarding whether the licensing regulations advanced a substantial government interest. In response, the City asserted that its licensing regulations served the substantial government interest of reducing the negative secondary effects associated with sexually oriented businesses.  The Owners did not dispute that this was a substantial government interest. As such, the court found that the owners failed to cast doubt either on the City’s findings that sexually oriented businesses contributed to urban blight and negatively impacted property values, or its concern with public health and the spread of sexually transmitted diseases. Thus the City’s licensing regulations were reasonably designed to serve the substantial government interest of reducing the negative secondary effects associated with sexually oriented businesses. The court therefore affirmed the district court’s grant of partial summary judgment in favor of the City on the Owners’ challenge to the 2004 licensing regulations on sexually oriented businesses.

Cornell Restaurant Ventures v City of Oakland Park, 2017 WL 908196 (11th Cir. CA 3/8/2017)