Reply Brief — City of New Albany v. New Albany DVD, LLC

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No. 09-1027

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Supreme Court of the United States

City OF NEw ALBANY, INDIANA,

Petitioner,

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New ALBaNny DVD, LLC,

Respondent.

On Petition for Writ of Certtorari to the United

States Court of Appeals for the Seventh Circuul

PETITIONER’S REPLY BRIEF

SHANE L. GIBSON Scott D. BERGTHOLD

City ATTORNEY Counsel of Record

311 Hauss SQUARE LAw OFFICE OF Scotr

Room 316 D. BERGTHOLD, P.L.L.C.

New ALBANY, IN 47150 7446 SHALLOWFORD Roap

(812) 948-5333 SUITE 202

CHATTANOOGA, TN 37421

(423) 899-3025

sbergthold@sdblawfirm com

Counsel for Petitioner

City of New Albany, Indiana

May 24, 2010

Becker Gallagher - Cincinnati, OH - Washington, DC - 800 890 5001

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TABLE OF CONTENTS

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TABLE OF AUTHORITIES

Cases

Annex Books, Inc. v. City of Indianapolis,

581 F.3d 460 (7th Cir. 2009) ............ 9,12

Annex Books, Inc. v. City of Indianapolis,

333 F. Supp. 2d 773 (S.D. Ind. 2004) ..... 9,12

Boos v. Barry, =:

PM CE og bce ove csv eevee sd ouwes 6

City of Erie v. Pap’s A.M.,

G2P U.S. 27s CHS) . 0. wc ccc ccc reeves 9

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

535 U.S. 425 (2002) ........... 1, 3, 10, 11, 12

City of Renton v. Playtime Theatres, Inc.,

Boe Wee A UAE occ ce ce wrevectccoucuss 3,11

Daytona Grand, Inc. v. City of Daytona Beach,

490 F.3d 860 (11th Cir. 2007) .............. 9

Doctor John’s v. Wahlen,

§42 F.3d 787 (10th Cir. 2008) .............. 8

Flanigan’s Enéers., Inc. v. Fulton County,

596 F.3d 1265 (11th Cir. 2010) ............. 8

G.M. Enters., Inc. v. Town of St. Joseph,

350 F.3d 631 (7th Cir. 2003) ............... 9

McCreary County v. ACLU,

Gk | re 2

ill

New Haven Inclusion Cases,

ee eS ok a oS fb os beers wee 3

Russell v. Southard,

ee ED gy yy we 3 odo pee oe ee ee 3

SOB, Inc. v. County of Benton,

317 F.3d 856 (8th Cir. 2003) ............... 9

United States v. O’Brien,

a 8 |) re 2,3

Wisconsin Vendors, Inc. v. Lake County,

152 F. Supp. 2d 1987 (N.D. Ill. 2001) ....... 10

World Wide Video of Washington, Inc. v. City of

Spokane,

368 F.3d 1186 (9th Cir. 2004) .............. 6

1

PETITIONER’S REPLY BRIEF

Respondent's brief in opposition wholly fails to

refute, and thus concedes, the extensive split in the

circuits that has been percolating in the lower courts

over City of Los Angeles v. Alameda Books, Inc., 535

U.S. 425 (2002), a “fractured decision” that “dozens of

appellate decisions . . . have struggled to understand

and apply” without producing “any concrete legal rule.”

(App. 44a) (Easterbrook, C.J.). Instead of addressing

the question presented—a question of “utmost

importance” to amicus International Municipal

Lawyers Association and cities and counties

nationwide—respondent quibbles about procedure and

facts irrelevant to that question. For the (unrefuted)

reasons stated in the petition, this Court should issue

a writ of certiorari to review the decision below.

1. Respondent’s statement about the procedural

posture of the case is unavailing. First, respondent

does not deny that the entirety of the City’s secondary

effects evidence—including land use and crime impact

reports, judicial decisions, eyewitness observations of

adverse impacts, and the testimony of the City’s expert

witness—is in the record and was evaluated by the

lower courts. Respondent, whose counter-evidence is

also in the record, is thus tellingly silent about what

discovery would be taken that is relevant to the

question presented. There is none. At bottom,

respondent’s argument assumes its own conclusion:

that the City should have to begin the case anew to

conduct an empirical, after-the-fact local study that

the Seventh Circuit—in direct contravention of this

Court’s precedents—requires.

2

Second, respondent does not dispute that this Court

often reviews First Amendment cases on preliminary

injunction. Indeed, the only case that respondent cites

on this issue, McCreary County v. ACLU, 545 US. 844,

867 (2005), is consistent with the cases cited in the

petition (at 29-30) in that the Court granted certiorari

to review a First-Amendment based preliminary

injunction.

2. As to the _ facts, respondent’s roving

statement—which is unsupported by amy citations to

the record—is: (a) irrelevant to the question presented,

(b) includes material outside the record, and (c) is rife

with inaccuracies.

a. Respondent’s factual statement begins with an

attempt to impugn the City’s motives (Brf. Opp. 4-13)

based on how various individuals—including citizens

who are not City officials or employees—reacted when

they learned that DVD had lied to the City about the

kind of business it was establishing next to a home

and across the street from a church. (R. 19, Wood Aff.

at 1) (tile shop misrepresentation).

DVD’s discussion is irrelevant for two reasons.

First, it is irrelevant to the question presented, which

asks whether the Seventh Circuit’s new legal standard

for secondary effects evidence contravenes this Court’s

precedents. Second, DVD’s amended complaint

challenging Ordinance G-04-10 did not claim that

strict scrutiny applied or that the Ordinance banned or

restricted speech because of objection to content. (R.

39.) Instead, DVD claimed that the City’s secondary

effects evidence was insufficient to _ satisfy

intermediate scrutiny under United States v. O’Brien,

391 U.S. 367 (1968). (R. 39, J 29.) Moreover, under

3

O’Brien, “this Court will not strike down an otherwise

constitutional statute on the basis of an alleged illicit

legislative motive.” City of Renton v. Playtime

Theatres, Inc., 475 U.S. 41, 48 (1986) (quoting O’Brien,

391 U.S. at 383-84).

The factual statement continues (Brf. Opp. 13-20)

with commentary about the extensive secondary

effects evidence, including competing expert witness

testimony, presented to the district court—which

concluded that the City met its burden under the

“reasonably believed to be relevant” standard

established in Renton and reaffirmed in Alameda

Books. (App. 23a-24a.) Respondent’s discussion,

which goes to the merits of the question presented by

the Seventh Circuit’s departure from that standard,

actually highlights elements of the circuit split shown

in the petition and demonstrates that this case’s full

evidentiary record on secondary effects makes it an

ideal vehicle for resolving the question presented.

b. Attempting to litigate the Seventh Circuit’s new

standard in this Court, respondent resorts to arguing

evidence completely outside of the record. (Brf. Opp.

21-22) (alleging facts occurring after entry of the

injunction and after oral argument in the Seventh

Circuit). This is wholly inappropriate. Russell v.

Southard, 53 U.S. 139, 159 (1851); New Haven

Inclusion Cases, 399 U.S. 392, 450 n.66 (1970).

Moreover, this inappropriate argument simply

underscores—again—the centrality of the question

presented, which concerns whether a city must present

empirical, localized proof that it has already suffered

secondary effects in order to justify a Renton-type

regulation designed to prevent them.

4

c. The inaccuracies in respondent’s factual

statements about early events in the case and the

evidence presented at the second evidentiary hearing,

though irrelevant to the question presented, are

sufficiently egregious to warrant a response.

First, respondent attempts to obscure the fact that

its adult bookstore is adjacent to a home and across

the street from a church by describing the street it is

on as “lead[ing} to a local gambling casino.” (Brf. Opp.

3.) The casino is five to eight miles away. (R. 116, Tr.

101:20-24.)

Second, respondent parrots the Seventh Circuit’s

statement that respondent “secured all necessary

licenses” prior to February 19, 2004. In fact, the

district court found that DVD did not apply for an

improvement location permit (ILP) prior to February

19, 2004, but did so only after the first evidentiary

hearing. (App. 30a.) The initial application was denied

based on safety issues (e.g., a pole sign in the middle of

the driveway providing ingress/egress from and to

Main Street) and based on the location restrictions in

the Ordinance. (R. 61, Ex. B.) After the site plan was

amended to resolve the miscellaneous safety issues,

the ILP was denied solely based on the location

restrictions. (App. 30a.) Thus, the parties agree that

the Ordinance is the only impediment to DVD’s lawful

operation at its present location. Moreover, as the

Seventh Circuit observed, whether DVD opened

lawfully “has no continuing import.” (App. 3a.)

Similar observations refute respondent’s challenge

to the term “unsafe building” in the Notice-Order that

the building commissioner applied to respondent’s site

on February 19, 2004. The term properly applies to a

D

building that is being used but has not been inspected

for safety and thus lacks a certificate of occupancy. (R.

74, Tr. 79:6-8, 80:18-20.) Moreover, as noted above, the

site was in fact unsafe for various reasons, including

the dangerous location of the pole sign. (App. 15a; R.

61, Ex. B.)

Third, respondent cites its own _ counsel’s

statements to claim that the letter setting an

administrative hearing on the February 19, 2004

Notice-Order was a “ruse” because the “hearing was

never held” on March 9, 2004. Yet, respondent’s

counsel initiated cancellation of the hearing by

agreement on the ground that he had already filed suit

concerning the same issue to be addressed in the

hearing. (R. 19, Exh. A, {7 8-11.)

Fourth, respondent’s irrelevant factual statement

attempts to impugn the motives of the City by

quoting—without citation—various individuals who

spoke during public meetings. But respondent

erroneously attributes to the mayor a block quote of

comments that were actually voiced by a citizen.

(Compare Brf. Opp. at 9-10 with R. 21, Exh. A, Feb. 19,

2004 Transcript at Sheet 6 (comments of Betty

Walters).) Additionally, DVD quotes _ several

statements from certain citizens on an ad hoc advisory

committee who are neither elected officials nor City

employees and who did not participate in drafting

Ordinance G-04-10. (See, e.g., Brf. Opp. 10-11.)

Respondent’s discussion of select portions of the

second evidentiary hearing is misleading on multiple

fronts, but ultimately highlights the deep circuit split

detailed in the petition.

6

First, respondent argues that the City “did not rely

upon any study that exclusively dealt with ‘retail’

establishments such as DVD.” (Brf. Opp. 14.) Of

course, this argument begs the question of whether

legislative evidence must be specific to a plaintiffs

self-defined subcategory of sexually oriented business.

(See Pet. 17-22) (describing circuit split on this issue).

Moreover, the City did present evidence of

secondary effects from retail-only adult bookstores.

(See Pet. 4-5.) Claiming that the Garden Grove study

has “nothing indicating it is devoted to retail

establishments” (Brf. Opp. 18), respondent attempts to

convey the impression that the study did not address

retail-only adult bookstores at all. However, the study

did include such establishments. (R. 76, Exh. D at 4-5.)

Likewise, the Greensboro study relied upon by the City

included retail-only adult bookstores. (R. 89, Exh. C at

37; see also R. 75 at 11-18 (citing city’s reliance upon

the secondary effects evidence from retail-only adult

bookstores found sufficient in World Wide Video of

Washington, Inc. v. City of Spokane, 368 F.3d 1186

(9th Cir. 2004).) This is in addition to studies

documenting the adverse effects of “adult bookstores”

which the City reasonably concluded includes adult

bookstores like respondent. (See, e g., R. 76, Exhs. C-1,

C-3, C-4.)

Second, respondent attempts to redefine the City’s

regulatory rationale (Brf. Opp. 14), but the district

court correctly explained what is undisputed: that the

Ordinance’s purpose is to prevent secondary effects.

(App. 23a.) Respondent, in fact, concedes that the City

“was not advancing the notion that viewing adult

materials causes adverse secondary effects.” (Brf. Opp.

17-18); cf. Boos v. Barry, 485 U.S. 312, 320-21 (1988)

7

(explaining the difference between primary and

secondary effects).

Third, respondent’s discussion ignores the wide

variety of secondary effects, including adverse impacts

on property values, that the Ordinance targets (App.

52a) and instead addresses only crime, repeating its

previous mischaracterization of the criminological

theory articulated by the City’s rebuttal expert.

(Compare Brf. Opp. 14 with Pet. 10) (discussing

routine activities theory).

Respondent’s argument concerning the City’s

interest in preventing crime is without merit.

Recognizing that New Albany had no sexually oriented

businesses when respondent sought to open,

respondent cites calls-for-service (CFS) to the police to

non-sexually oriented businesses in New Albany to

show that the City had no basis for regulating sexually

oriented businesses. (App. 22a) (noting DVD presented

evidence on establishments that sell some adult

material in back rooms, but “are not regulated by the

Ordinance” because they fall below the threshold of

sexually explicit material necessary to be qualified as

an adult bookstore) (emphasis added). Respondent’s

argument is plainly irrelevant to whether the City

relied on some evidence “reasonably believed to be

relevant” to its interest in regulating avowedly

sexually oriented businesses like respondent.

Moreover, to the extent that respondent seeks to

analogize its 100% adult bookstore to non-sexually

oriented businesses with adult material behind blinder

racks next to cigarettes (i.e., a convenience store) or in

a back room (i.e., a neighborhood video store), it

8

highlights the comparative-analysis issue in the split

among the circuits. (Pet. 22-28.)

The Seventh Circuit embraced the non sequitur

raised by sexually oriented businesses in every

secondary effects case, namely that if a given non-

adult business has greater secondary effects than an

adult business, there is no substantial government

interest in regulating to prevent the adverse impacts

of the adult business. (App. 38a) (holding that 41

arrests for public masturbation at adult bookstore

during one-year period do not establish a substantial

government interest without a showing that these

adverse effects are greater than those at non-adult

businesses). But see, e.g., Flanigan’s Enters., Inc. v.

Fulton County, 596 F.3d 1265, 1281 (11th Cir. 2010)

(holding that county established substantial

government interest in preventing the secondary

effects identified at adult businesses “[e]ven if we were

to accept that crime is greater in and around the non-

adult establishments”).

Indeed, respondent’s reliance on Dr. Linz’s analysis

of local CFS data only emphasizes the deep circuit

split on the evidence necessary to satisfy the Renton-

Alameda Books standard. For example, Judge

Easterbrook’s opinions below (in Annex Books and in

this case) credit Dr. Linz’s testimony in holding that

the cities have not compiled sufficient evidence to

satisfy that standard. (App. 7a) (alluding to evidence

from Dr. Linz “implying that take-home adult stores

do not have adverse secondary effects”); (App. 41a)

(crediting Dr. Linz’s testimony in reversing summary

judgment for Indianapolis). But other circuit courts

have reached the opposite conclusion. See, e.g., Doctor

John’s v. Wahlen, 542 F.3d 787, 792 (10th Cir. 2008)

9

(affirming summary judgment on regulation of retail-

only adult bookstore and “[I]n light of the Supreme

Court’s rejection [in City of Erte v. Pap’s A.M.,529 U.S.

277, 300 (2000)] of this specific analysis by Dr. Linz,

we see little need to continue.”); Daytona Grand, Inc.

v. City of Daytona Beach, 490 F.3d 860, 883 n.3 (11th

Cir. 2007) (“Interestingly, Damiel Linz, one of the

experts hired by Lollipop’s, alse co-authored the

studies found to be insufficient in two of these cases.

See G.M. Enters., Inc. [v. Town of St. Joseph), 350 F.3d

[631] at 635-36, 639 [(7th Cir. 2003)]; SOB, Inc. [v.

County of Benton), 317 F.3d [856] at 863 [(8th Cir.

2003)).”).

Similarly, the plaintiffs’ evidence in both this case

and in Annex Books consisted of police calls-for-service

(CFS) data. (App. 22a, n.13); Annex Books, Inc. v. City

of Indianapolis, 333 F. Supp. 2d 773, 786 (S.D. ind.

2004) (noting that Dr. Linz analyzed police call data),

rev'd in relevant part, 581 F.3d 460 (7th Cir. 2009)

(App. 33a et seq.). While Judge Easterbrook’s opinions

credited this kind of data, other circuits have rejected

it as insufficient to undermine municipalities’ interest

in regulating sexually oriented businesses. See, e.g.,

Daytona Grand, 490 F.3d at 882 & n.31 (discussing

survey of leading criminology journals which found

that none of the 245 recent articles measuring crime or

crime risk used CFS for that purpose).

Fourth, respondent’s challenges to Dr. McCleary’s

testimony (rebutting Dr. Linz) are without merit. For

example, Dr. McCleary’s entire testimony makes it

clear that the City has a valid public safety concern

over DVD’s proximity to the church across the street

any time that people are on the premises. (R. 116, Tr.

167:21-25) (clarifying that his statement concerning

10

churches is based on the “idea of church worship on

Sunday morning, which I assume is a very slow

business time for sexually-oriented businesses. For

that reason the public safety is not relevant. But when

you get into use of the church facility at other periods of

time, then public safety issues become relevant”)

(emphasis added).

Similarly, respondent mischaracterizes Dr.

McCleary’s testimony by suggesting that “local

criminals” are the City’s central concern. Dr.

McCleary never referred to “local” criminals, but

rather testified that adult businesses of all types,

including retail-only adult bookstores, attract both

potential victims and predatory criminals from a wide

area, e.g., outside the neighborhood. (R. 116, Tr.

168:107.)

Finally, respondent’s reference to the 30%

threshold for the adult bookstore classification is

likewise a red herring. DVD is not a mainstream

bookstore seeking to avoid regulation, but is an

undisputed adult bookstore whose sole raison d’etre is

the sale of sexually explicit fare. Indeed, ordinances

commonly apply such thresholds (R. 116, Tr. 168:14-

169:13), and thereby avoid vagueness claims

frequently raised against less precise definitions. See,

e.g., Wisconsin Vendors, Inc. v. Lake County, 152 F.

Supp. 2d 1987 (N.D. Ill. 2001).

3. Respondent’s discussion of Alameda Books is

equally unavailing because it neither denies the

existence of the circuit split compelling this Court’s

review nor shows that the Seventh Circuit’s decision is

correct under that case.

11

Contrary to respondent’s suggestion, Alameda

Books does not require municipalities to affirmatively

prove causation of secondary effects. Rather, Alameda

Books reaffirmed Renton’s central holding “that a

municipality may rely on any evidence that is

‘reasonably believed to be relevant’ for demonstrating

a connection between speech and a _ substantial,

independent government interest.” 535 U.S. at 438

(plurality opinion); id. at 535 at 451 (Kennedy, J.,

concurring in judgment). Similarly, Alameda Books

refused to require municipalities to “bear the burden

of providing evidence that rules out” alternate

explanations of secondary effects. Id. at 437 (plurality

opinion).

Nor does Alameda Bocks require evidence that

adult establishments produce a greater amount of

crime than non-adult establishments. First, the

language that respondent quotes comes from the

plurality’s description of the Ninth Circuit’s decision,

not from a prescriptive rule of law. 535 U.S. at 436.

Nothing in the plurality opinion suggests that sexually

oriented businesses must be proven to have the most

crime problems in a municipality in order for the

municipality to justify regulations designed to prevent

such businesses’ secondary effects. Yet, as noted in the

petition, a circuit split has developed over this issue

and requires resolution by this Court. (Pet. 22-28.)

Finally, respondent’s closing reminder that the

remand order gives the City a “second bite at the

apple” is an implicit concession that the Seventh

Circuit created a new legal standard, because the

district court already conducted a full evidentiary

hearing under the “reasonably believed to be relevant”

standard established in Renton and reaffirmed in

12

Alameda Books. After the evidentiary hearing, the

district court concluded:

The City has established through this evidence

the first prong of the Renton test for the

following reasons. First, the Ordinance states

that its purpose is to prevent a wide variety of

harms that sociological and criminological

studies tend to demonstrate are associated with

sexually oriented businesses. . . . Second, the

studies relied upon by the City in enacting the

Ordinance are relevant to the problem of

regulating secondary effects, such as crime. ...

Under the Alameda Books test, DVD neither

demonstrates that the City’s evidence does not

support its rationale nor does it dispute the

factual findings of the many studies relied upon

by the City.

- (App. 23a-24a.)

Conspicuously absent from the Seventh Circuit’s

decision below—as well as from the Annex Books

decision on which it relies and respondent’s brief in

opposition—is any mention of this Court’s “reasonably

believed to be relevant” standard. Because the decision

below jettisoned that standard in favor of much more

rigorous requirements for secondary effects

ordinances, this Court should grant certiorari and

reverse.

13

CONCLUSION

For the foregoing reasons, and those stated in the

petition, the petition for a writ of certiorari should be

granted.

Respectfully submitted,

Shane L. Gibson Scott D. Bergthold

CITY ATTORNEY Counsel of Record

311 Hauss Square LAW OFFICE OF SCOTT

Room 316 D. BERGTHOLD, P.L.L.C.

New Albany, IN 47150 7446 Shallowford Road

(812) 948-5333 Suite 202

Chattanooga, TN 37421

(423) 899-3025

sbergthold@sdblawfirm.com

May 24, 2010