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World Wide Rush, LLC v. City of Los Angeles

May 26, 2010

WORLD WIDE RUSH, LLC, A PENNSYLVANIA LIMITED LIABILITY COMPANY; INSITE OUTDOOR WORKS, LA, LLC, A DELAWARE LIMITED, LIABILITY COMPANY, PLAINTIFFS-APPELLEES,
v.
CITY OF LOS ANGELES, A CALIFORNIA MUNICIPAL CORPORATION, DEFENDANT-APPELLANT.
SKY TAG, INC., A CALIFORNIA CORPORATION; SKY TAG WEST, INC., A CALIFORNIA CORPORATION; SUNSET & VINE, INC., A CALIFORNIA CORPORATION; WEST HOLLYWOOD INC., A CALIFORNIA CORPORATION; SKY CREATIVE SERVICES, INC., CALIFORNIA CORPORATION; SKY POSTERS INC., A CALIFORNIA CORPORATION, PLAINTIFFS-APPELLEES,
v.
CITY OF LOS ANGELES, A CALIFORNIA CHARTER CITY, DEFENDANT-APPELLANT.
WILSHIRE CENTER, LLC, A DELAWARE LIMITED LIABILITY COMPANY; JAMISON 1055 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; WILMONT, LLC, A DELAWARE LIMITED LIABILITY COMPANY; EQUITABLE PLAZA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 3545 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; METROPLEX, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 3600 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 3699 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 4041 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 4055 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 4201 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; JAMISON 5455 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; WEST WILSHIRE MEDICAL CENTER, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 9800 LA CIENEGA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; FAIRFAX BUSINESS CENTER, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 7080 HOLLYWOOD, LLC, A DELAWARE LIMITED LIABILITY COMPANY; 700 FLOWER PLAZA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY COMPANY; 4929 WILSHIRE, LP, A DELAWARE LIMITED PARTNERSHIP; 3575 CAHUENGA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 1900 WESTWOOD, LLC, A CALIFORNIA LIMITED LIABILITY; 933 N. LA BREA, LLC, A DELAWARE LIMITED LIABILITY COMPANY; ROYAL BEVERLY GLEN PLAZA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 1055 SEVENTH, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 6380 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 11620 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 3875 WILSHIRE, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 16501 VENTURA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 17000 VENTURA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY; 22801 VENTURA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, PLAINTIFFS-APPELLEES,
v.
CITY OF LOS ANGELES, A CALIFORNIA CHARTER CITY, DEFENDANT-APPELLANT.



Appeal from the United States District Court for the Central District of California. Audrey B. Collins, Chief District Judge, Presiding. D.C. Nos. 2:07-cv-00238-ABC-JWJ, 2:08-cv-05434-ABC-JWJ & 2:08-cv-04762-ABC-JWJ.

The opinion of the court was delivered by: Wardlaw, Circuit Judge

FOR PUBLICATION

Argued and Submitted December 10, 2009 -- Pasadena, California.

Before: Stephen Reinhardt, Stephen S. Trott and Kim McLane Wardlaw, Circuit Judges.

OPINION

The City of Los Angeles ("City") appeals the grant of summary judgment in favor of World Wide Rush and Insite Outdoor Works LA (collectively "WWR") and the entry of injunctions in favor of WWR and Wilshire Center, Jamison, and Sky Tag (collectively "Sky Tag") enjoining enforcement of certain billboard regulations. We must decide whether the district court erred in concluding that (1) the City's Freeway Facing Sign Ban is an unconstitutionally underinclusive restriction on commercial speech and (2) the City's Super-graphic and Off-Site Sign Bans are unconstitutional prior restraints on speech. Because the City's exceptions to the Freeway Facing Sign Ban do not undermine the City's asserted interests in enacting the Ban, and because the City Council's authority to create exceptions to the Supergraphic and Off-Site Sign Bans is a permissible aspect of its inherent legislative discretion, we reverse.

The City also appeals the district court's order finding it in civil contempt of the injunction against enforcement of the Freeway Facing Sign Ban and the Supergraphic and Off-Site Sign Bans as to WWR's billboards. Because we vacate the injunction, we also reverse the contempt order.

Finally, we affirm the district court's decision to allow just one round of amendments to the pleadings as a proper exercise of its discretion.

BACKGROUND

"The story of billboards in America is . . . characterized by an ongoing struggle between an expanding industry and a resistant public." David Burnett, Note, Judging the Aesthetics of Billboards, 23 J.L. & Pol. 171, 174 (2007). One of the first chapters in this story played out in Saint Louis in 1911, when the Missouri Supreme Court was called upon to decide whether cities had the power to regulate billboards at all. See St. Louis Gunning Adver. Co. v. City of St. Louis, 137 S.W. 929, 941 (Mo. 1911). At that time, billboards were "temporary affairs" constructed from "upright timbers, or posts set in the ground" and "braced from the rear, with stringers running from one to the other." Id. at 941-42. They were described as "inartistic" and "unsightly" monstrosities that were "liable to be blown down and to fall upon and injure those who may happen to be in their vicinity." Id. It was even said that they were "hiding places and retreats for criminals and all classes of miscreants." Id. The Missouri Supreme Court had little trouble concluding that "this class of advertising as now conducted" was "subject to control and regulation by the police power of the state." Id. at 942.

Of course, not everyone shared this view. One author described billboards of that era as "thing[s] of beauty" that bore "work of artistic and pleasing character, framed in a structure of tasteful design." Frank Presbrey, The History and Development of Advertising 503-04 (1929). Decades later, in an essay detailing the history of outdoor advertising, the President of the Outdoor Advertising Association of America described billboards as "an important business tool" and emphasized that their "influence reaches the people in every city and town without getting in their way." Phillip Tocker, Standardized Outdoor Advertising: A History, Economics and Self-Regulation, in Outdoor Advertising: History and Regulation 56 (1969). He even argued that billboards "assisted communities . . . in beautifying areas." Id. at 53. "All that [the billboard industry] asks in return," he pleaded, "is to continue to do business where others do business, under the same freedoms and limitations." Id. at 56.

These appeals present the latest chapter in "the story of billboards." No longer tied to wooden posts protruding from holes in the ground, in modern-day cities such as Los Angeles, today's billboards may be projected onto or hung from the sides of skyscrapers or strategically located near main traffic arteries so that they are visible from great distances by masses of would-be consumers. Their labels alone (e.g., "super-graphic signs") conjure up a setting far removed from Saint Louis in the early 1900s. As the nature of billboards has changed, so too has the nature of the legal problems they present. The question of the day is no longer whether cities may regulate billboards at all, but is instead the extent to which they may do so consistent with the First Amendment guarantee of freedom of expression.

I. The City's Sign Regulations

The City regulates signs, including billboards, through Chapter I, Article 4.4 of the Los Angeles Municipal Code ("LAMC"). Article 4.4's stated purpose is to "promote public safety and welfare" by "provid[ing] reasonable protection to the visual environment" and by ensuring that billboards do not "interfere with traffic safety or otherwise endanger public safety." LAMC § 14.4.1. Article 4.4 prohibits some types of billboards and restricts the size, placement, and illumination of others. These appeals arise from First Amendment challenges to certain content-neutral provisions of Article 4.4: the "Freeway Facing Sign Ban" and the "Supergraphic and Off-Site Sign Bans."

A. Freeway Facing Sign Ban

Article 4.4's Freeway Facing Sign Ban prohibits billboards located within 2,000 feet of and "viewed primarily from" a freeway or an on-ramp/off-ramp. LAMC § 14.4.6(A). Notwithstanding the Freeway Facing Sign Ban, the City has permitted freeway-facing billboards in some circumstances, two of which are applicable here.*fn1 First, in 1999, the City adopted an ordinance authorizing billboards near the Staples Center, a state-of-the-art sports and entertainment complex that was developed to eliminate blight and dangerous conditions in downtown Los Angeles. See Los Angeles, Cal., Ordinance No. 172465 (1999). The City asserted that the nature of the Staples Center's use, coupled with its location in the center of a highly urbanized area, required billboards that could effectively communicate event-related information. Id. Today, there are several freeway facing billboards near the Staples Center, including some that use flashing displays and frequently changing digital content.

The City made another exception to the Freeway Facing Sign Ban in 2008, when it undertook plans to renovate Santa Monica Boulevard with the aim of improving the flow of traffic between the 405 Freeway and the Beverly Hills border. See Los Angeles, Cal., Ordinance No. 179827 (2008). However, the targeted traffic corridor was home to sixteen billboards, the outright elimination of which might have triggered the City's obligation to compensate the billboards' owners under California's eminent domain law. See Cal. Bus. & Prof. Code ยง 5412. To avoid the requirements of takings law, including the obligation of just compensation, the City agreed with the billboard owners that four sign faces could be relocated to a newly ...


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