Petition for Writ of Certiorari — Ten's Cabaret, Inc., fka Stringfellow's of New York, Inc., et al., Petitioners v. City of New York, New York, et al.

NO.

In the Supreme Court of the United States

TEN’S CABARET, INC., FORMERLY KNOWN AS

STRINGFELLOW’S OF NEW YORK, INC., AND

PUSSYCAT LOUNGE, INC., D/B/A “PUSSYCAT LOUNGE”,

Petitioners,

v.

THE CITY OF NEW YORK, MAYOR MICHAEL BLOOMBERG,

AS MAYOR OF THE CITY OF NEW YORK, AND

PATRICIA LANCASTER, AS COMMISSIONER OF THE

DEPARTMENT OF BUILDINGS OF THE CITY OF

NEW YORK, et al.,

Respondents.

On Petition for Writ of Certiorari to the

State of New York Court of Appeals

PETITION FOR WRIT OF CERTIORARI

Martin P. Mehler

Counsel of Record

Mehler & Buscemi

305 Broadway

New York, New York 10007

(212) 962-4688

mmehler@mehlerbuscemi.com

Counsel for Petitioners

Becker Gallagher · Cincinnati, OH · Washington, D.C. · 800.890.5001

i

QUESTIONS PRESENTED FOR REVIEW

1. Does the First Amendment allow the facial

constitutionality of a 16 year old amendment to an

adult zoning law to be determined, either at all or

exclusively, by whether, more than a decade after the

amendment’s adoption, an undetermined and random

number of then-operating businesses (operating under

injunctions allowing them to present adult

entertainment in up to 40% of their square footage,

most of which businesses were not parties hereto), are

deemed to be engaged in only “sham compliance” with

the pre-amendment law which did not restrict such

businesses?

2. If so, is there a constitutionally requisite

minimum percentage of examined businesses which

must be operating as “shams” in order to conclude that

such an amendment was constitutional at the time of

enactment?

3. In any event, was the ad hoc “sham” test utilized

by the Court of Appeals impermissibly random or

vague by failing both to 1) articulate what minimum

percentage of businesses must be found to be shams

and 2) define objective criteria to be used in

determining whether a business should be deemed a

“sham”?

ii

PARTIES TO THE PROCEEDINGS

PETITIONERS

Ten’s Cabaret, Inc., formerly known as Stringfellow’s

of New York, Inc.; Pussycat Lounge, Inc. d/b/a

“Pussycat Lounge.”

RESPONDENTS

The City of New York, a municipal corporation.

The Mayor of the City of New York. At the time the

action was commenced the Mayor was Hon. Michael

Bloomberg. At this time, the Mayor is Hon. Bill

DeBlasio.

The Commissioner of the Department of Buildings of

the City of New York. At the time the action was

commenced the Commissioner was Hon. Patricia

Lancaster. At this time, the Commissioner is Hon.

Rick D. Chandler.

ADDITIONAL RESPONDENTS

(PLAINTIFFS BELOW)

For The People Theatres of N.Y. Inc., d/b/a Fair

Theatre, and JGJ Merchandise Corp. d/b/a Vishans

Video a/k/a Mixed Emotions, were plaintiffs in an

unconsolidated companion action separately tried in

the trial Court and separately briefed on all appeals.

The cases were consolidated at the appellate

proceedings for argument and decision.

iii

RULE 29.6 STATEMENT

Ten’s Cabaret, Inc. has no parent corporation and no

publicly held company owns any of its stock.

Pussycat Lounge, Inc. has no parent corporation and no

publicly held company owns any of its stock.

iv

TABLE OF CONTENTS

QUESTION PRESENTED FOR REVIEW . . . . . . . . i

PARTIES TO THE PROCEEDINGS . . . . . . . . . . . . ii

RULE 29.6 STATEMENT . . . . . . . . . . . . . . . . . . . . iii

TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . viii

OPINIONS BELOW . . . . . . . . . . . . . . . . . . . . . . . . . 1

JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

STATUTORY PROVISIONS . . . . . . . . . . . . . . . . . . 3

STATEMENT OF THE CASE . . . . . . . . . . . . . . . . . 3

REASON FOR GRANTING THE WRIT . . . . . . . . 21

The New York Court of Appeals decided an

important question of federal law that has not

been, but should be, settled by this Court:

whether the novel “sham compliance” test

utilized by the court below to uphold New York

City’s adult zoning ordinance is a permissible

test for adjudicating the constitutionality of an

ordinance imposing widespread restrictions on

expression . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

APPENDIX

Appendix A Decision and Order of the Supreme

Court of the State of New York,

County of New York, in Ten’s Cabaret,

Inc., etc., et al. v. City of New York, et

al. (September 9, 2003) . . . . . . . . App. 1

v

Appendix B Decision and Order of the Supreme

Court of the State of New York,

Appellate Division, First Department,

in For The People Theatres of N.Y.,

Inc., etc., et al. v. City of New York, et

al. (April 12, 2005) . . . . . . . . . . . App. 20

Appendix C Decision of the New York Court

of Appeals in For The People Theatres

of N.Y., Inc., etc., et al. v. City of

New York, et al. (December 15, 2005)

. . . . . . . . . . . . . . . . . . . . . . . . . . App. 53

Appendix D Decision and Judgment of the

Supreme Court of the State of New

York, County of New York, in Ten’s

Cabaret, Inc., etc., et al. v. City of New

York, et al. (April 22, 2010) . . . . App. 86

Appendix E Decision and Order of the Supreme

Court of the State of New York,

Appellate Division, First Department,

in For The People Theatres of N.Y.,

Inc., etc., et al. v. City of New York, et

al. (April 7, 2011) . . . . . . . . . . . . App. 90

Appendix F Decision, Order and Judgment of the

Supreme Court of the State of New

York, County of New York, in For The

People Theatres of N.Y., Inc., etc., et al.

v. City of New York, et al. (August 30,

2012) . . . . . . . . . . . . . . . . . . . . . App. 117

vi

Appendix G Decision and Order of the Supreme

Court of the State of New York,

Appellate Division, First Department,

in For The People Theatres of N.Y.,

Inc., etc., et al. v. City of New York, et

al. (July 21, 2015) . . . . . . . . . . App. 141

Appendix H Decision and Remittitur of the New

York Court of Appeals in For The

People Theatres of N.Y., Inc., etc., et al.

v. City of New York, et al. (June 6,

2017) (declaring 2001 Amendments

constitutional) . . . . . . . . . . . . . App. 185

Appendix I Order of the New York Court of

Appeals in For The People Theatres

of N.Y., Inc., etc., et al. v. City of

New York, et al. (June 27, 2017)

(denying stay pending petition for

certiorari) . . . . . . . . . . . . . . . . . App. 218

Appendix J Order of the New York Court of

Appeals in For The People Theatres of

N.Y., Inc., etc., et al. v. City of New

York, et al. (September 12, 2017)

(denying reargument) . . . . . . . App. 220

Appendix K New York City Council Resolution 897

(1995 definition of “adult

establishment” and “adult eating or

drinking establishment”) . . . . . App. 222

Appendix L New York City Department of Buildings

Operation, Policy & Procedure Notice

(OPPN) 4/98 . . . . . . . . . . . . . . . App. 225

vii

Appendix M New York City Department of Buildings

Operation, Policy & Procedure Notice

(OPPN) 6/98 . . . . . . . . . . . . . . . App. 228

Appendix N New York City Council Resolution

2096 (2001 definition of “adult

establishment” and “adult eating or

drinking establishment”) . . . . . App. 231

viii

TABLE OF AUTHORITIES

CASES

City of Los Angeles v. Alameda Books, Inc.,

535 U.S.425 (2002) . . . . . . . . . . . . . . . . . . . . . . . . 1

City of New York v. Dezer Properties, Inc.,

95 N.Y.2d 771, 732 N.E.2d 943 (2000) . . . . . 6, 21

City of New York v. Les Hommes,

94 N.Y.2d 267, 724 N.E.2d 368 (1999) . . . . . 5, 21

For The People Theatres of N.Y., Inc., etc., et al. v.

City of New York, et al.,

20 A.D.3d 1, 793 N.Y.S.2d 356

(1st Dept. 2005) . . . . . . . . . . . . . . . . . . . . . . . . 1, 9

For The People Theatres of N.Y., Inc., etc., et al. v.

City of New York, et al.,

6 N.Y.3d 63, 843 N.E.2d 1121 (2005) . . . . passim

For The People Theatres of N.Y., Inc., etc., et al. v.

City of New York, et al.,

84 A.D.3d 48, 923 N.Y.S.2d 11

(1st Dept. 2011) . . . . . . . . . . . . . . . . . 2, 15, 17, 22

For The People Theatres of N.Y., Inc., etc., et al. v

City of New York, et al.,

38 Misc.3d 663, 954 N.Y.S.2d 801

(Sup. Ct. N.Y. Co. 2012) . . . . . . . . . . . . . . . passim

For The People Theatres of N.Y., Inc., etc., et al. v.

City of New York, et al.,

131 A.D.3d 279, 14 N.Y.S.3d 338

(1st Dept. 2015) . . . . . . . . . . . . . . . . . . . . 2, 19, 20

ix

For The People Theatres of N.Y., Inc., etc., et al. v.

City of New York, et al.,

29 N.Y.3d 340, 79 N.E.3d 461, 57 N.Y.S.3d 69

(2017) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim

For The People Theatres of N.Y., Inc., etc., et al. v.

City of New York, et al.,

29 N.Y.3d 1115, 83 N.E.3d 848 (2017) . . . . . 3, 21

Ten’s Cabaret, Inc., etc., et al. v. City of

New York, et al.,

1 Misc.3d 399, 768 N.Y.S.2d 786 (Sup. Ct. N.Y.

Co. 2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1, 8

CONSTITUTIONS, STATUTES, AND

ORDINANCES

U.S. Const. amend. I . . . . . . . . . . . . . . . . . . 3, 6, 9, 20

U.S. Const. amend. XIV . . . . . . . . . . . . . . . . . . . . . . 3

28 U.S.C. § 1257(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 3

28 U.S.C. § 2101(f) . . . . . . . . . . . . . . . . . . . . . . . . . . 21

N.Y. Const. Art. I, § 8 . . . . . . . . . . . . . . . . . . . . . . . . 6

New York City Department of Buildings Operation,

Policy & Procedure Notice (OPPN) 4/98 . . . . . . . 4

New York City Department of Buildings Operation,

Policy & Procedure Notice (OPPN) 6/98 . . . . . . . 4

The Council of the City of New York Resolution

No. 897, 1995 Amendments . . . . . . . . . . . . passim

The Council of the City of New York Resolution

No. 2096, 2001 Amendments . . . . . . . . . . . passim

x

RULE

Sup. Ct. R. 13.3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

1

PETITION FOR A WRIT OF CERTIORARI

Petitioners respectfully pray that a Writ of

Certiorari issue to review the June 6, 2017 decision of

the New York Court of Appeals upholding 2001

amendments (the “2001 Amendments”) to the City of

New York’s pre-existing 1995 adult zoning scheme.

OPINIONS BELOW

The initial opinion in this action was rendered by

the Supreme Court of the State of New York, County of

New York (York, J.), on September 9, 2003, granting

summary judgment to plaintiffs and declaring the 2001

Amendments unconstitutional. It is reported at 1

Misc.3d 399, 768 N.Y.S.2d 786 (Sup. Ct. N.Y. Co. 2003),

and reprinted in the Appendix to this Petition. (App.

1-19).

The April 12, 2005 opinion of the Appellate

Division, First Department, of the Supreme Court of

the State of New York, reversing Justice York and

declaring the 2001 Amendments constitutional, is

reported at 20 A.D.3d 1, 793 N.Y.S.2d 356 (1st Dept.

2005), and reprinted in the Appendix to this Petition.

(App. 20-52).

The November 17, 2005 opinion of the New York

Court of Appeals, reversing the Appellate Division and

remanding the action for an evidentiary hearing

pursuant to City of Los Angeles v. Alameda Books, Inc.,

535 U.S.425 (2002), is reported at 6 N.Y.3d 63, 843

N.E.2d 1121 (2005), and reprinted in the Appendix to

this Petition. (App. 53-85).

The unreported April 22, 2010 opinion of the

Supreme Court of the State of New York, County of

2

New York (York, J.), following an evidentiary hearing

on remand and declaring the 2001 Amendments

constitutional, is reprinted in the Appendix to this

Petition. (App. 86-89).

The April 7, 2011 opinion of the Appellate Division,

First Department, of the Supreme Court of the State of

New York, reversing Justice York and remanding the

action for findings and redetermination, is reported at

84 A.D.3d 48, 923 N.Y.S.2d 11 (1st Dept. 2011), and

reprinted in the Appendix to this Petition. (App. 90116).

The August 30, 2012 opinion of the Supreme Court

of the State of New York, County of New York (York,

J.), on the second remand, declaring the 2001

Amendments unconstitutional, is reported at 38

Misc.3d 663, 954 N.Y.S.2d 801 (Sup. Ct. N.Y. Co. 2012),

and reprinted in the Appendix to this Petition. (App.

117-140).

The July 21, 2015 opinion of the Appellate Division,

First Department, of the Supreme Court of the State of

New York, affirming Justice York, is reported at 131

A.D.3d 279, 14 N.Y.S.3d 338 (1st Dept. 2015), and

reprinted in the Appendix to this Petition. (App. 141184).

The June 6, 2017 opinion of the New York Court of

Appeals, reversing the Appellate Division and

declaring the 2001 Amendments constitutional, is

reported at 29 N.Y.3d 340, 79 N.E.3d 461 (2017), and

reprinted in the Appendix to this Petition. (App. 185217).

3

JURISDICTION

The jurisdiction of this Court rests on 28 U.S.C.

§ 1257(a). A different party to the proceeding before

the New York Court of Appeals filed a timely petition

for reargument of the appeal. The Order of the Court of

Appeals denying reargument of the appeal was entered

on September 12, 2017 and is reported at 29 N.Y.3d

1115, 83 N.E.3d 848 (2017). (App. 220-221). This

Petition is timely under Supreme Court Rule 13.3.

STATUTORY PROVISIONS

United States Constitution, Amend. I, provides in

relevant part that: “Congress shall make no law …

abridging the freedom of speech ….”

United States Constitution, Amend. XIV, provides

in relevant part that: “No State shall make or enforce

any law which shall abridge the privileges or

immunities of citizens of the United States; nor shall

any State deprive any person of life, liberty, or property

without due process of law.”

STATEMENT OF THE CASE

In 1995, the City of New York adopted amendments

to its Zoning Resolution designed to reduce

concentrations of adult entertainment businesses, to

separate them from various sensitive uses and zones,

and to mitigate secondary effects in connection with

garish exterior signage which was then common in

front of such businesses, all for the purpose of reducing

perceived adverse secondary effects in neighborhoods

surrounding such businesses. (Hereafter “the 1995

Ordinance.”)

4

The 1995 Ordinance required termination within

one year of all businesses it rendered non-conforming,

resulting in substantial reductions in the concentration

and overall number of adult businesses in New York

City and a general consensus that it “cleaned up”

Times Square.

Nonetheless, as administratively1 and later

judicially2 construed (following concessions as to its

proper interpretation made in court by attorneys for

the City), the 1995 Ordinance exempted businesses

which used less than 40% of their floor space for

presenting adult live entertainment. (App. 121, 190).

Consequently, although several adult live

entertainment businesses simply closed by the end of

the one year termination period, a number of others

converted to what became known as “60-40” businesses

and simultaneously modified their exterior signage to

remove notably garish signs, the elimination of which

had been an important goal of the 1995 Ordinance.3

In 2001, notwithstanding the apparent total success

of the 1995 Ordinance, the City passed the 2001

1

See New York City Department of Buildings Operations Policy &

Procedure Notices 4/98 and 6/98. (App. 225-230).

2

See, 38 Misc.3d at 674 (App. 121) and 29 N.Y.3d at 344 (App.

190).

3

Several of these businesses re-configured their premises, at great

expense, so as to pass muster under the forty percent standard.

Different clubs put the 60% portion of their space to different nonadult uses. E.g., Petitioner Ten’s opened a steakhouse as part of

its facility; Petitioner Pussycat Lounge used the majority of its

space as a rock concert venue.

5

Amendments to its 1995 Ordinance, which expressly

removed the exemption for businesses presenting adult

live entertainment in less than 40% of their premises

and despite no new study suggesting there remained

any need for further reductions in the number of adult

businesses, much less elimination of the surviving

businesses with no-longer-garish signs which used less

than 40% of their premises for presentation of live

adult entertainment. (App. 231-234)4

Between 1995 and 2001, the City challenged a small

number of these “60/40 businesses” as being in “sham

compliance” with the 1995 ordinance, but these

challenges were rejected by the New York Court of

Appeals, concluding, essentially, that the square

footage standards were the only relevant standards

and were very clear and, so long as a business complied

with them, there was no such thing as “sham”

compliance. See City of New York v. Les Hommes, 94

N.Y.2d 267, 724 N.E.2d 368 (1999) (bookstore), and

4

The 2001 Amendments included distinct provisions eliminating

the option of “60-40 compliance” for most bookstores as well, and

the challenges by the bookstore owners and live entertainment

businesses proceeded concurrently in the same courts on parallel

tracks. Both cases came before the New York Court of Appeals

twice, and both times were disposed of by that Court in a single

appellate case involving both groups of litigants.

However, the current Petition addresses only the portion of the

litigation challenging the restrictions imposed by the 2001

Amendments on adult eating and drinking establishments and is

brought solely on behalf of those presenting live adult

entertainment. Nonetheless, the Court is advised that Petitioners

believe that a separate certiorari petition is being filed in this

Court by those representing “60-40” bookstores under the name

For the People Theatres v. City of New York.

6

City of New York v. Dezer Properties, Inc., 95 N.Y.2d

771, 732 N.E.2d 943 (live entertainment business)

(2000).

Following enactment of the 2001 Amendments,

several parties, including Petitioners, challenged those

amendments in the New York state courts.

Petitioners’ State court challenges asserted claims

solely under the New York Free Expression Clause

(Art. I, § 8, of the New York Constitution) although the

bookstore plaintiffs in For The People Theaters asserted

claims under the First Amendment.

In response to these various challenges, the State

court enjoined enforcement of the 2001 Amendments

City-wide before it took effect. Through a combination

of injunctions and/or stays which remained in effect for

approximately 15 years pending numerous appeals,

remands, re-trials, etc., the 2001 Amendments did not

take effect until they were finally upheld in June of

this year by the New York Court of Appeals. However,

since that time, the City has voluntarily agreed to

withhold enforcement against Petitioners pending the

outcome of any timely filed certiorari petitions.

Although Petitioners herein asserted only state

constitutional challenges (which nevertheless required

determination of the First Amendment issues upon

which the state Free Expression protections are

premised), the “bookstore plaintiffs” additionally

expressly challenged the 2001 Amendments under the

federal First Amendment and the New York Court of

Appeals, in its unitary opinion in both appeals, held

that the 2001 Amendments do not violate any of the

Plaintiffs’ First Amendment rights. 29 N.Y.3d at 344

7

(App. 190.) That ruling is binding against Petitioners

in the New York courts and provides the basis for this

Court’s certiorari jurisdiction herein.

The Relevant Constitutional Rulings Below

All of the numerous lower court rulings turned on

the sole question of whether the City, in 2001, had

established a sufficient evidentiary basis for concluding

that the then-existing 60-40 businesses caused

sufficient adverse secondary effects in their

surrounding neighborhoods to justify the 2001

provisions eliminating those businesses.

Although there had been several noted changes

caused by the 1995 Ordinance, including: (1) fewer

adult businesses overall; (2) significantly reduced

concentrations of adult businesses; and (3) successful

elimination of the type of garish and previously

common exterior signage the 1995 Ordinance was

designed to eliminate, the City conducted no new study

prior to enacting its 2001 Amendments to see if there

remained an ongoing need for further restrictions.

Consequently, in enacting its 2001 Amendments,

the City relied solely on the evidence of secondary

effects it had assembled prior to enacting the original

1995 Ordinance. That evidence consisted solely of

relying on: (1) a 1994 Department of City Planning

(DCP) Adult Entertainment Study (the DCP Report)

and a 1995 City Planning Commission Report (the CPC

Report), both of which looked at then-existing 100%

adult businesses in the City and identified a number of

adverse conditions existing near those businesses, but

concluded that they could not find that the conditions

they observed were necessarily attributable to the

8

presence or operation of the adult businesses; and (2)

cases and studies from other jurisdictions asserting a

general correlation between concentrations of adult

entertainment businesses and perceived adverse

secondary effects.

Significantly, both the City’s CPC Report and DCP

Report investigated only the impacts outside the adult

businesses and neither pointed to any adverse

secondary effects occurring inside the businesses.

The plaintiffs submitted evidence offered to

demonstrate that the 60-40 businesses (all of which

came into existence only after and in response to the

1995 Ordinance) did not cause significant adverse

secondary effects, including crime studies near 60-40

businesses and a variety of other evidence.

Initially, the lower court granted summary

judgment declaring the 2001 Amendments

unconstitutional as a matter of law. 1 Misc.3d 399,

768 N.Y.S.2d 786 (Sup. Ct. N.Y. Co. 2003) (App. 1-19).

On the pivotal question of whether the City had

established a nexus between the “60/40”

establishments existing in 2001 and the adverse

secondary effects attributed to the 1994-95 “100%”

establishments studied in the DCP Report, the trial

Court held, in pertinent part, as follows:

This court holds that defendants may not rely on

the 1993 [sic, 1994] DCP Report as the basis for

the 2001 amendments. The … DCP Report did

not study 60/40s, and it cannot be used as

evidence to demonstrate that these

establishments cause secondary effects. A [new]

study would reveal whether the 60/40 rule

9

remedied the adverse secondary problems

described in the … DCP Report or whether a

broader law is necessary. Furthermore, plaintiff

has presented data of its own demonstrating

that 60/40s do not cause the secondary effect of

increased crime. (Ten’s Cabaret, exhibit D, Feb.

2001 police report.) Thus, defendants have not

met their burden under the First Amendment.

For the same reason, defendants have not shown

that the 2001 amendments are “justified by

concerns unrelated to speech.” (Stringfellow’s, 91

NY2d at 397.) Accordingly, the 2001

amendments fail to meet the New York State

constitutional requirements of article I, § 8.

While New York courts have “long recognized

the considerable authority of municipalities to

implement zoning plans and programs to meet

the increasing encroachments of urbanization,”

if an ordinance, as here, aims to curb adult uses

then it implicates speech or conduct protected

under both the First Amendment and by article

I, § 8 of the New York State Constitution and

must be held to stricter scrutiny. (Stringfellow’s,

91 NY2d at 395-396.).

The intermediate appellate court reversed and

granted judgment in favor of the City, declaring the

2001 Amendments constitutional as a matter of law,

20 A.D.3d 1, 793 N.Y.S.2d 356 (1st Dept. 2005) (App. 2052), holding that plaintiffs had the burden of

affirmatively proving that the “essential nature” of the

60/40’s had changed, making reliance on the 1994 DCP

Report inappropriate, and had failed to carry their

burden.

10

Upon initial review by the New York Court of

Appeals (the 2005 Decision) (6 N.Y.3d 63, 843 N.E.2d

1121 (2005) (App. 53-85), three judges agreed with the

trial court and voted to reverse the intermediate court

and reinstate the trial court’s judgment of

unconstitutionality. 6 N.Y.3d at 84, 843 N.E.2d at

1134. However, the four-judge Court of Appeals

majority, agreeing that a reversal was in order,

nonetheless remanded for further proceedings as it felt

the evidence had not been adequately developed to

answer the relevant constitutional question.

Nonetheless, rather than remanding for a

determination of whether sufficient secondary effects

continued to exist in 2001 to justify the elimination of

all the 60-40 businesses, the majority instead

remanded for a bizarre and unprecedented

constitutional inquiry whereby the validity of the 2001

Amendments was to be based on whether an undefined

number of presently existing 60-40 businesses were

operating in some type of undefined “sham” compliance

with the pre-2001 zoning scheme, concluding that if it

is found that they are now so operating, then the 2001

Amendments should be found valid:

[A] triable question of fact has been presented as

to whether 60/40 businesses are so transformed

in character that they no longer resemble the

kinds of adult uses found, both in the 1994 DCP

Report and in studies and court decisions around

the country, to create negative secondary

effects—as plaintiffs contend — or whether

11

these businesses’ technical compliance with the

60/40 formula is merely a sham — as the City

contends.

6 N.Y.3d at 83-84, 843 N.E.2d at 1133.

Additionally, the majority specifically stated that

the remand would not require the City to prove the

existence of any ongoing adverse secondary effects

caused by the presence or operation of the 60-40

businesses. Its sole concern should be with whether

the interior operation of an undefined number of the

currently existing 60-40 businesses was essentially the

same as that of their 100% predecessors, concluding

that if their interior focus is found to still be on adult

entertainment, they should be deemed a “sham”

regardless of any changes in their exterior appearance

or their overall number or concentration, all of which

may impact secondary effects. Importantly, it did not

even articulate a standard of how widespread the

asserted current “sham” compliance must be in order to

find the 2001 Amendments valid:

Because plaintiffs have ... “furnish[ed]

evidence that disputes the [City’s] factual

findings,” the burden shifted back to the City “to

supplement the record with evidence renewing

support for a theory that justifies its ordinance”

(Alameda Books, 535 U.S. at 439). The City was

not required, however, to relitigate the

secondary effects of adult uses, or to produce

empirical studies connecting 60/40 businesses to

adverse secondary effects.

. . . [W]e anticipate that the City will produce

evidence relating to the purportedly sham

12

character of self-identified 60/40 book and video

stores, theaters and eating and drinking

establishments or other commercial

establishments located in the city. This does

not mean that the City has to perform a

formal study or a statistical analysis, or to

establish that it has looked at a

representative sample of 60/40 businesses in

the city. If the trier of fact determines, after

review of this evidence, that the City has fairly

supported its position on sham compliance —

i.e., despite formal compliance with the 60/40

formula, these businesses display a

predominant, ongoing focus on sexually explicit

materials or activities, and thus their essential

nature has not changed — the City will have

satisfied its burden to justify strengthening the

1995 Ordinance by enacting the 2001

Amendments, and will be entitled to judgment

in its favor.

6 N.Y.3d at 83-84, 843 N.E.2d at 1132-1133 (emphasis

added).

In short, the remand seemed to turn on whether an

undefined percentage of then-currently operating 60-40

businesses were still predominantly focused on adult

entertainment, regardless of any changes designed to

reduce or eliminate any adverse effects on their

surrounding neighborhoods.

In an opinion by then Chief Judge Kaye, the three

Court of Appeals dissenters urged that:

The City was obliged to present some evidence

demonstrating a nexus between the 60/40

13

businesses and the deleterious social effects

supporting its 2001 regulation. The City cannot

rely on the studies justifying the 1995 ordinance

because the businesses within the reach of the

2001 law are different in character than those

the City sought to regulate 10 years ago. While

it produced voluminous evidence that the

businesses targeted by the 1995 law were the

source of deleterious negative secondary effects,

the City has offered nothing of the kind here.

In contrast, in support of their motions for

summary judgment, plaintiffs produced

substantial evidence that the 60/40 businesses

are functionally different from the pre-1995

businesses and that the 60/40 businesses do not

produce negative secondary effects. The

plaintiffs provided expert proof that property

values increased in 60/40 neighborhoods on a

par with those in the rest of the city after the

1995 resolution went into effect and that crime

rates dropped in 60/40 precincts at the same or

greater rate as in non-60/40 precincts after the

1995 resolution was enforced. Additionally, the

plaintiffs offered evidence that many of the

community representatives in areas with a

heavy presence of 60/40 businesses who had

supported the 1995 resolution now opposed the

2001 amendment.

63 N.Y. at 87; emphasis in original.

On remand, after discovery, a lengthy trial was

held. Fourteen witnesses testified. The City conceded

that it had the burden of proof. Its case-in-chief

witnesses were two New York City Building

14

Department inspectors, three New York City Police

Department officers, and five “60/40” club operators

(including the principals of the petitioners). The

Building Inspectors and Police Officers testified to their

observations made upon inspection of a number of

“60/40” clubs. None of these witnesses claimed any

knowledge of or attempted to compare the “60/40” clubs

with the “100%” clubs studied in 1994. However, one

of the Inspectors, who is the City’s signage expert,

supported the Petitioners’ claim by admitting that the

City’s signage regulations adopted as part of the 1995

Amendments had resulted in “toned down” signage for

adult establishments throughout the City, and the trial

court ultimately expressly found this to be the case. 38

Misc.3d at 672-673.

Petitioner’s representatives, called as adverse

parties, and the other club operators, testified as to the

extent and expense of converting their businesses to a

“60/40” business model in order to comply with the

“substantial portion” test under the 1995 Amendments,

the nature of their current operations, and their

current advertising, especially on the Internet. None

of these witnesses was asked to compare their “60/40”

operation to their prior “100%” operations.

Petitioners also called three expert witnesses,

subsequently found credible by the trial court, who

testified that their studies indicated that the “60/40”

clubs are not criminogenic, do not have any adverse

affect on real estate values, and were much more

acceptable to neighborhood residents than the clubs

which existed in 1995 featuring garish exterior signage.

In rebuttal, the City called an “all-purpose” rebuttal

15

expert, whom the court expressly found not to be

credible.

The trial court, without making findings, then

summarily held the 2001 Amendments constitutional

in respect of adult eating and drinking establishments

based solely on its interpretation of the opinion of the

New York Court of Appeals. (App. 86-89).5

Upon intermediate appellate review, the judgment

of constitutionality was reversed, 84 A.D.3d 48, 923

N.Y.S.2d 11 (1st Dept. 2011) (App. 90-116). The action

was remanded to the trial court for findings of fact and

re-determination, with critical guidance from the

intermediate appellate court that the City had to

establish a 1994 “baseline” in order to rely on the 1994

DCP Report to justify the 2001 Amendments:

In assessing the validity of the 2001

Amendments, Supreme Court needed to

compare “self-identified” 60/40 businesses with

the adult businesses discussed in the DCP

Report, other studies and case law so as to

determine whether the 60/40 businesses

retained a predominant focus on sexually

explicit materials. In so doing, Supreme Court

needed to determine the particular

5

It a later opinion following another remand, the trial court

conceded that it had mistakenly reached this conclusion because:

“too much emphasis was placed on the easy burden this

court understood the Court of Appeals had placed on the

City. Moreover, the rational basis and substantial

evidence tests were not appropriate means to determine

the constitutional validity of the legislation in question.”

38 Misc.3d 663, 673, 954 N.Y.S.2d 801, 808.

16

characteristics associated with the promotion of

sexually explicit materials. The negative

characteristics identified by the Supreme Court

would serve as baseline against which the “so

transformed” issue could be adjudicated. Using

that baseline, Supreme Court would then need

to determine whether the 60/40 businesses had

a similar predominant focus on sexually explicit

materials.

In establishing the criteria by which the current

uses can be compared to the uses studied in

1994, the DCP Report is a helpful starting

point. Though that study focused on the

consequences of significant concentrations of

adult businesses emphasizing sexually explicit

materials and not the particular attributes that

caused secondary effects, it did highlight some of

the attributes that define an adult business.

Specifically, it noted that establishments might

qualify as being of an adult nature if they

1) exclude minors by reason of age or 2) sold

materials emphasizing “specified sexual

activities” or “specified anatomical areas.” In

addition to those salient characteristics, the

study placed special emphasis on the presence of

adult signs that were larger than those of

nearby non-adult businesses.

Based on the DCP Report, it is possible to

discern the relevant characteristics of adult uses

that can be linked to a focus on sexually explicit

materials. For example, the presence of large

signs advertising adult content may indicate a

predominant focus on promoting sexually

17

explicit materials. The same is true of a

significant emphasis on the promotion of

materials exhibiting “specified sexual activities”

or “specified anatomical areas,” as evidenced by

a large quantity of peep booths featuring

adult films. Other indicators of a predominant

focus on sexually explicit materials might be the

exclusion of minors from the premises on the

basis of age or difficulties in accessing non-adult

materials. In using the DCP Report to assess

the constitutionality of the 2001 Amendments,

Supreme Court should consider the extent to

which 60/40 businesses have such attributes in

determining whether they have a predominant

focus on sexually explicit materials [or

activities].

84 A.D.3d at 61-62; footnotes omitted.

On remand, the City declined to introduce any

additional evidence. The trial court then made well in

excess of 100 findings of fact and concluded [38 Misc.3d

663, 954 N.Y.S.2d 801 (2012) (App. 117-140)] that the

2001 Amendments were facially unconstitutional:

This court finds significant and distinct

differences between the 1994 adult entities and

60/40 entities, so that the current

establishments no longer resemble their 1994

predecessors. Given their current arrangements

and secondary characteristics, these entities no

longer operate in an atmosphere placing more

dominance of sexual matters over nonsexual

ones. Accordingly, there is no need for the 2001

amendments. On their face, therefore, they are

18

a violation of free speech provisions of the US

and State Constitutions.

In a coda to his opinion that the trial judge labeled

“dicta,” he continued, in pertinent part:

… [T]his court cannot understand how an 18year-old study of the negative effects of the 100%

entities can be applied to the current 60/40

entities without determining the actual negative

secondary effect of these institutions today. It

was primarily the increased crime rates that

spawned the 1994 DCP Report and led to the

legislative changes in 1995 that this record

shows was successful. New York State has a

storied reputation for protecting freedom of

speech. Its courts have consistently held that the

content of speech cannot be regulated (People v

Mobil Oil Corp., 48 NY2d 192 [1979]). What can

be regulated are the negative secondary effects

of the legislation in issue by virtue of

the exercise of the police powers (Stringfellow’s

of N.Y. v City of New York, 241 AD2d 360 [1st

Dept 1997]). Here, no investigation was

conducted by the defendants. Instead, there was

a fictionalized reliance on the 1994 study.

Without an actual study, the 2001 legislation

should have been struck down, as urged by the

three-judge Court of Appeals’ minority opinion

in For the People (at 6 NY3d 88).

***

Isn’t, without a finding of negative secondary

effects generated by the current 60/40 entities,

what the City is really regulating—the content

of expression — clearly a violation of the

19

plaintiffs’ rights to freedom of speech (People v

Mobil Oil Corp., 48 NY2d 192 [1979])?

38 Misc.3d at 675-76 (emphasis added).

On appeal, a divided panel of the intermediate

appellate court rejected the City’s bid for judgment in

its favor and affirmed the judgment of

unconstitutionality, 131 A.D.3d 279, 14 N.Y.S.3d 338

(1st Dept. 2015), with the three judge majority holding

that while the City had established “that the 60/40

clubs regularly feature topless dancing and lap dancing

in a substantial portion of their overall space” and

heavily promote this aspect of the business, the City’s

evidence was insufficient to justify reliance on the 1994

DCP Report to make the constitutionally critical

connection between the challenged ordinance and

adverse secondary effects, explaining that:

there was little to no evidence presented as to

the other factors, such as the nature of the

outward signage (first factor) and the difficulty

in accessing the nonadult material, or, in this

case, the nonadult section of the club (fourth

factor). There was also no evidence presented as

to the nature of the pre-1994 or 100% clubs.

***

As with the book stores and video stores,

satisfaction of one of the factors is not sufficient

to meet the City’s burden. The City assumes

that because the 60/40 clubs regularly feature

topless dancing, this automatically means that

they retain a predominant sexual focus.

However, there is nothing in the prior related

decisions that mandates that conclusion. Thus,

20

this Court finds that the City has not met its

burden with respect to the adult eating and

drinking establishments.

131 A.D.3d at 293 (emphasis added).

The two dissenting intermediate appellate judges

disagreed, returning to the (seemingly) discredited

theme of “sham compliance” and concluding that “the

trial [C]ourt … allowed its improper reconsideration of

“negative secondary effects” to permeate its decision,

and that the City has sustained its burden as to sham

compliance by demonstrating that by and large the

essential character of the 60/40 businesses has not

changed. 131 A.D.3d at 295.

On further appeal, the New York Court of Appeals

noted that “the Appellate Division’s approach lost sight

of the fact that the [only] issue was whether there was

sham compliance.” 29 N.Y.3d at 361; 79 N.E.3d 476.

The court concluded that “sham compliance” (by an

undetermined percentage of businesses at the time of

trial) had been successfully demonstrated and that it

was therefor “evident as a matter of law that the

City met its burden of showing that the adult

establishments continued to have a predominant focus

on sexually explicit materials and activities.”

The Court of Appeals accordingly reversed, finding

the 2001 Amendments facially valid not only under the

New York Constitution, but also under the First

Amendment to the United States Constitution: “It

follows, under our 2005 decision in this case, that the

amendments do not violate plaintiffs’ First Amendment

rights.” 29 N.Y.3d at 344, 79 N.E.3d at 463 (App. 186).

21

Basis For Finality of Decision

Concurrent motions in both For The People Theatres

and Ten’s/Pussycat Lounge for stays pending petitions

for writs of certiorari were then denied without opinion

by Associate Judge Fahey pursuant to 28 U.S.C.

§ 2101(f) (App. 218-219) and, more recently, the New

York Court of Appeals denied a motion in For The

People Theatres for reargument, reported at 29 N.Y.3d

1115, 83 N.E.3d 848 (2017) (App. 220-221), bringing

finality to the State court litigation and clearing the

way for Supreme Court review.

REASONS FOR GRANTING THE WRIT

The New York Court of Appeals decided an

important question of federal law that has not

been, but should be, settled by this Court:

whether the ad hoc “sham compliance” test

exclusively utilized by the court below to uphold

New York City’s adult zoning ordinance is a

permissible test for adjudicating the

constitutionality of an ordinance imposing

widespread restrictions on expression.

Relying on its earlier 2005 Opinion, the New York

Court of Appeals’ 2017 Decision upheld the

constitutionality of the City’s 2001 Amendments based

solely on whether an undefined number of so-called 6040 businesses in existence more than a decade later

were operating in what it referred to as “sham

compliance” with the law as it existed prior to the 2001

Amendments (even though its own earlier opinions in

Les Hommes and Dezer, supra, expressly held that any

businesses meeting the square footage requirements

22

were, as a matter of law, not to be deemed in sham

compliance).

In both its 2005 and 2017 opinions herein, the Court

of Appeals defined “sham compliance” as merely

whether a live entertainment business continued to

have a “predominant focus on sexually explicit …

activities” (6 N.Y.3d at 84 and 29 N.Y.3d at 344). Its

opinions did not specify the objective criteria by which

this determination of “predominant focus” should be

measured (e.g., percentage of adult vs. non-adult

revenue, percentage of adult vs. non-adult advertising,

percentage of adult vs. non-adult square footage), nor,

even more importantly, did it ever state how many of

the then-existing 60-40 businesses in New York City

needed to have been found in “sham compliance” in

order for the 2001 Amendments to be upheld.

Although the Court of Appeals’ 2005 remand

instructions were ambiguous (as evidenced by the

numerous conflicting lower court opinions on remand

trying to interpret them), its 2017 opinion made clear

that it had also implicitly presumed that any other

evidence would be irrelevant.

Both the vagueness and constitutional irrelevance

of this “sham compliance” test are best revealed by

comparing the Court of Appeals’ holding with the trial

court’s numerous findings of fact, all of which seem to

be more pertinent to the constitutional issue than the

insufficiently defined and artificial “sham” test

established by the Court of Appeals. Following an

extensive evidentiary trial, the trial court made each of

the following findings of fact:

23

84.

a. 60/40 clubs are not associated with

negative secondary crime effects;

b. 60/40 clubs were not “hot spots” for

crime in their neighborhoods;

c. crimes did not increase with the

opening of a 60/40 club;

d. crimes did not decrease after the

closing of a 60/40 club.

***

87.

Since the enactment of the 1995

amendments, adult establishments have

dramatically declined in numbers.

88.

Adult clubs have become far more widely

dispersed since the enactment of the 1995

amendments.

***

93.

The court finds that the current signage

for 60/40 entities is less garish, more subdued

and, frequently, the 60/40 nonadult portion is

equally or more prominent than the adult

portion.

38 Misc.3d at 672-673.

Also, after finding plaintiffs’ expert Michael Anastas

to be “a credible witness with an expertise in market

research” (id.), the trial judge made the following

additional Findings of Fact with respect to conclusions

Anastas had reached based on Anastas’ extensive

surveys of residents comparing 60-40 businesses with

their 100% predecessors:

24

82.

a. the overall quality of life in the 60/40

clubs’ areas was better;

b. the 60/40 neighborhoods were safer;

c. the 60/40 neighborhoods were a more

preferable place to live;

d. the 60/40 neighborhoods were a preferred

shopping area.

(Id.)

The trial court nonetheless attempted to apply the

test given it on remand and reached the following

conclusions of law:

Although 18 years have passed since … [the

DCP’s 1994] study and significant changes have

occurred since … [that] Study, both the Court of

Appeals in its remand and the Appellate

Division remand after that, have directed this

court not to consider any negative secondary

effects of these changes. The ultimate question

they have laid out, is whether the nature of

these entities have so changed that they no

longer resemble their 100% forebears. To do

this, we must consider whether their nonadult

features or characteristics predominate over

their adult features.

One of the characteristics pointed out by the

DCP Study was the concentration of adult

businesses in particular neighborhoods. Now,

due to the provisions of the 1995 ordinance,

these entities are not able to exist in residential

and many manufacturing and commercial

25

neighborhoods, but where they are allowed to

exist only one such entity is permitted in each

zoning district, and must be at least 500 feet

from each other and any school or house of

worship. Thus, there are no more such

concentrations. In contrast to the 1994 study,

entities where the entire business contained

100% adult entities, all of the current entities

studied, contain separate adult and nonadult

sections with more product or space devoted to

nonadult features. The nonadult portion is

almost always located in the front of the

entity with the adult section in the back, so that

a patron can visit the front and never go to the

back of the store, a distinct difference from the

1994 areas. In many of the entities, patrons in

the nonadult section are unable to see what is

going on in the adult section, a contrast to the

100% entities in the 1994 study. In most

businesses, there are legitimate activities going

on in the nonadult sections, which can be a

restaurant, or a sports bar, or entertainment in

the form of theater or celebrity entertainment,

another feature distinct from its forbears. The

exterior and interior signage has changed. There

are almost no garish neon lighted signs, no hardcore sexual images or language on them and the

nonadult signage is as prominent as the adult

signage, certainly a significant change from the

1994 situation.

38 Misc.3d at 674-675.

Given the findings above, it would seem clear that

the Court of Appeals’ “sham compliance” test bore no

26

resemblance to any standards of constitutional analysis

previously identified by this Court. Additionally, it was

incredibly vague, particularly in that it did not even

identify what number or percentage of businesses must

be found in “sham compliance” in order for the 2001

Amendments to be upheld. For all these reasons, it

was utterly inappropriate for it to be used as the sole

basis for evaluation of the relevant constitutional

issues.

Nonetheless, Petitioners recognize that the City

would be unfairly prejudiced, having had these cases

remanded and tried under the Court of Appeals’

inappropriate “sham compliance” standard, if it were

not given the opportunity to put on its evidence under

an appropriate set of remand guidelines.

Consequently, Petitioners do not seek from this Court

a final determination of unconstitutionality but,

instead, request that the Court of Appeals’ decision be

vacated and remanded for further proceedings

pursuant to an appropriate constitutional standard for

final resolution of these cases.

27

CONCLUSION

For all these reasons, Petitioners respectfully urge

that their Petition for a Writ of Certiorari, to review

the Judgment declaring the 2001 Amendments to the

Zoning Resolution of the City of New York

constitutional, be granted.

Dated:

New York, New York

December 8, 2017

Respectfully submitted,

Martin P. Mehler

Counsel of Record

Mehler & Buscemi

305 Broadway

New York, New York 10007

(212) 962-4688

mmehler@mehlerbuscemi.com

Counsel for Petitioners