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INFINITY OUTDOOR, INC. v. CITY OF NEW YORK

October 11, 2001

INFINITY OUTDOOR, INC., PLAINTIFF,
V.
CITY OF NEW YORK, SATISH K. BABBAR, AND ANN MCCARTHY, DEFENDANTS.



The opinion of the court was delivered by: Gershon, District Judge.

  OPINION AND ORDER

Plaintiff, an outdoor advertising company, brings this action challenging the constitutionality of the Zoning Resolution of the City of New York, as amended in 2001, and companion enforcement legislation. Plaintiff alleges that the Zoning Resolution unconstitutionally burdens commercial speech in violation of the First Amendment by banning advertising signs, but permitting, subject to regulation, non-commercial signs near highways and parks and that the Zoning Resolution violates the First Amendment and the Equal Protection Clause of the Fourteenth Amendment by allowing certain types of non-commercial signs anywhere in the City. Plaintiff also challenges the enforcement legislation as an unconstitutional prior restraint, as impermissibly vague, as imposing civil penalties without a scienter requirement in violation of the Due Process Clause of the Fourteenth Amendment, and as imposing excessive fines in violation of the Eighth Amendment.*fn1 The defendants are the City of New York; Satish K. Babbar, the Acting Commissioner of the New York City Department of Buildings ("DOB"); and Ann McCarthy, the Executive Director of the New York City Environmental Control Board. Plaintiff moves for summary judgment pursuant to Fed.R.Civ.P. 56 on all of its claims except the excessive fines claim. Defendants move for summary judgment on all of plaintiff's claims. The New York Civil Liberties Union has filed an amicus curiae brief in support of plaintiff's motion for summary judgment, and the Municipal Art Society has filed an amicus curiae brief in support of defendants' motion for summary judgment.

I. FACTS AND BACKGROUND

There is no disputed issue of material fact.

The core provision of the Zoning Resolution challenged by plaintiff is the prohibition on placing off-site commercial signs near highways and public parks. New York City, like many other municipalities, divides signs into three categories. Offsite commercial signs, called "advertising signs" in the Zoning Resolution, are signs that direct attention to a business that is not located on the same lot as the sign. On-site commercial signs, called "accessory use signs," are signs that identify a business located on the same lot as the sign. Finally, non-commercial signs direct attention to something other than a business or commodity. Under the Zoning Resolution, non-commercial and on-site commercial signs are allowed near highways and parks, but off-site commercial signs are not. Plaintiff argues that this regulation impermissibly favors non-commercial speech over commercial speech. In addition, plaintiff challenges the provisions of the Zoning Resolution allowing non-commercial organizations, which may be located in any district, to display certain types of signs on their lots.

Plaintiff also challenges the implementation of the City's sign regulations, which require a permit before a sign can be displayed. As part of the permitting process, the DOB categorizes a proposed sign as an accessory, advertising, or non-commercial sign. The implementing regulations contain a presumption that signs placed by non-commercial speakers are non-commercial, but non-commercial messages by commercial entities also are treated as non-commercial. The DOB must act upon an application within 40 days or, if there is good cause for an extension, 60 days, and unsuccessful applicants may appeal a decision to the Board of Standards and Appeals ("BSA"), which must act "expeditiously." Finally, plaintiff challenges newly enhanced civil penalties of up to $15,000 for the first day of violation of the sign regulations and $25,000 for each subsequent day of violation.

While this summary of the current state of the challenged provisions of the Zoning Resolution provides an overview, the issues presented cannot be fully understood without an excursion into the history of the City's sign regulations.

A. EARLY REGULATION OF SIGNS

In 1916, New York City became the first municipality in the United States to implement a comprehensive zoning resolution, which included limited regulation of signs. See Major Reports of the City Planning Commission 85 (1940). In 1940, the City Planning Commission amended the Zoning Resolution to create the central provision that plaintiff challenges here: the prohibition of most off-site commercial signs within 200 feet of a public park or designated highway if the sign is visible from the park or highway. See New York, N.Y., Zoning Resolution ("ZR") § 21-B (1940), renumbered §§ 32-66, 42-53 (1961), renumbered §§ 32-662, 42-55 (2001). The list of designated highways, now called "arterial highways," has expanded over the years and includes such thoroughfares as the approaches to the Holland, Lincoln, and Queens-Midtown Tunnels, the approaches to the George Washington, Brooklyn, and Manhattan Bridges, Queens and Northern Boulevards, the Bruckner and Brooklyn-Queens Expressways, the West Side Highway, and the FDR Drive.

The heart of the Zoning Resolution's regulation of signs since 1940 has been the distinction between off-site commercial and on-site signs. Since 1940, an off-site commercial sign has been called an "advertising sign." It is now defined as "a sign that directs attention to a business, profession, commodity, service or entertainment conducted, sold or offered elsewhere than upon the same zoning lot and is not accessory to a use located on the zoning lot." ZR § 12-10 (2001). However, the term for on-site signs, which are signs that direct attention to a business or profession conducted upon the premises, has changed. Under the 1940 amendments to the Zoning Resolution, on-site signs were called "business signs," but now they are referred to as "accessory use" signs. See ZR § 3(q) (1940), renumbered § 12-10 (1998).

Since 1940, each type of sign has been subject to different regulations. The 1940 ordinance did not permit off-site signs in residential or some commercial districts; permitted but regulated on-site signs in these districts; and permitted all signs in some commercial districts such as Times Square. Former ZR §§ 4(49), 4-D, 4-E (1940). Off-site signs were prohibited near highways and parks, but on-site signs were permitted without restriction. ZR §§ 3(q), 21-B (1940), renumbered §§ 32-662, 42-55 (2001).

The City's limitation on signs near highways and parks was adopted for the purpose of improving traffic safety and aesthetics in the City. Not only did the City seek to produce quality of life benefits for residents and visitors, but it also sought to produce economic benefits by increasing the number of residents and visitors. The City Planning Commission found that "[b]illboards and signs not only dominate our business streets . . . but they take advantage of every opportunity to crowd in upon public places, established and maintained by public funds, including civic centers, parks, and especially express highways and bridge approaches." Major Reports of the City Planning Commission 90 (1940). The City's concern with the proliferation of signs led to a general prohibition on signs in residential and commercial districts. However, the City excluded certain commercial districts, such as Times Square, in order to increase tourism and promote commerce. The City Planning Commission also excluded on-site signs from the general prohibition because it found that the needs of businesses to identify their locations on particular lots outweighed the City's aesthetic and traffic safety interests. See id.

In the 1961 amendments to the Zoning Resolution, the City maintained the ban on advertising signs within 200 feet of a highway or public park, and began to regulate the size of advertising signs beyond 200 feet of highways and public parks. The Zoning Resolution, as amended in 1961, provided that in all manufacturing and commercial districts where advertising signs are permitted:

no advertising sign shall be located, nor shall an existing advertising sign be structurally altered, relocated, or reconstructed within 200 feet of an arterial highway or of a public park with an area of one-half acre or more, if such advertising sign is within view of such arterial highway or public park. . . . . [B]eyond 200 feet from such arterial highway or public park, an advertising sign shall be located at a distance of at least as many linear feet therefrom as there are square feet of surface area on the face of such sign.

ZR §§ 32-66, 42-53 (1961), renumbered §§ 32-662, 42-55 (2001).*fn2

Although, since 1940, signs bearing noncommercial copy had been included in the Zoning Resolution's broad definition of signs, the Zoning Resolution addressed where on-site and off-site commercial signs were permitted, but made no separate provision for non-commercial signs. Because of this failure to provide for the placement of non-commercial signs, the Zoning Resolution was eventually declared unconstitutional. In 1997, the New York State Supreme Court, Kings County, found that the Zoning Resolution violated the Supreme Court's seminal billboard case, Metromedia, Inc. v. San Diego, 453 U.S. 490, 101 S.Ct. 2882, 69 L.Ed.2d 800 (1981). See City of New York v. Allied Outdoor, 172 Misc.2d 707, 714-15, 659 N.Y.S.2d 390 (1997).

In Allied Outdoor, the Court held that, since signs are permitted only to the extent provided for in the Zoning Resolution, and the Zoning Resolution provided only for advertising and business signs, noncommercial signs generally were not allowed. As a result, the Zoning Resolution violated Metromedia by favoring commercial speech over non-commercial speech. In response to the Allied Outdoor decision, the City amended the Zoning Resolution in 1998.

B. 1998 AMENDMENTS TO THE ZONING RESOLUTION

While the City continued to regulate signs near public parks and highways in order to combat the traffic safety and aesthetic problems created by these signs, it responded to Metromedia and Allied Outdoor by ensuring that "signs containing solely non-commercial speech will be treated in a uniform manner as signs relating to commercial uses or activities located on the zoning lot." City Planning Commission Report 5-6 (Feb. 18, 1998). The City amended the Zoning Resolution §§ 32-62 and 42-52 to provide for noncommercial signs, rather than just advertising and accessory signs.*fn4 Under the amended Zoning Resolution: 1) in manufacturing districts, non-advertising signs, that is, accessory and non-commercial signs, are permitted without restriction, even near highways and parks, ZR § 42-52 (1998); 2) in manufacturing districts, advertising signs are also permitted without restriction, except near highways and parks, ZR 42-52, § 42-53 (1998), renumbered § 42-55 (2001); 3) in commercial districts, non-advertising signs are permitted, subject to size, illumination, and projection limits, even near highways and parks, ZR § 32-62 (1998); and 4) in commercial districts, advertising signs are permitted, subject to size, illumination, and projection limits, only in some districts, but in these districts, advertising signs are prohibited near highways and parks, ZR §§ 32-63, 32-66 (1998), renumbered § 32-662 (2001).

Thus, the amended Zoning Resolution continues to prohibit advertising signs near highways and parks and to permit accessory signs, but now provides for non-commercial signs. As with accessory signs, it permits non-commercial signs near highways and parks. See ZR §§ 32-66, 42-53 (1998), renumbered §§ 32-661, 32-662, 42-55 (2001). Plaintiff challenges these sections under the First Amendment as impermissibly distinguishing between commercial and non-commercial speech.

Finally, there are certain exceptions to the general restrictions, which, in varying forms, have been in effect for many years. For example, the Zoning Resolution permits one identification sign of limited size on hotels, professional offices, and parking garages; illuminated signs of limited size on hospitals; and "for sale" signs of limited size in residential districts. ZR §§ 22-32, 22-33 (1998). And Zoning Resolution § 22-332 and § 32-62 permit, without limitation, "flags, banners or pennants other than those that are advertising signs, located on any zoning lot used primarily for community facility uses of a civic, philanthropic, educational or religious nature" in all districts. ZR §§ 22-332, 32-62 (1998). This exception, which has been in effect since 1940, recognizes the use of community facilities for non-commercial purposes and of the need that these facilities have to use signs to facilitate such gatherings. See City Planning Commission Report 11-12 (Feb. 18, 1998). Plaintiff challenges the exception for community facilities as unconstitutional under the Equal Protection Clause of the Fourteenth Amendment and the Free Speech Clause of the First Amendment on the ground that it favors certain types of non-commercial speech over other types of non-commercial speech.

C. 2001 AMENDMENTS TO THE ZONING RESOLUTION

After extensive hearings, and numerous submissions from public officials, community leaders, and representatives of the outdoor advertising industry, the City Council adopted amendments to the Zoning Resolution once again on February 27, 2001. The reason for these amendments was the proliferation in the number and size of signs that had resulted from new technologies and the "rampant illegality and lack of effective enforcement" that threatened the City's aesthetic appeal and traffic safety. City Planning Commission Report 2-8, 30 (Dec. 13, 2000); Hearing Before the New York City Council Subcommittee on Zoning & Franchises 11, 16-18 (Jan. 9, 2001). The City Planning Commission found that new technologies, such as light weight vinyl materials, have allowed for the production of larger sign structures at a lower cost and for the placement of these sign structures on new surfaces, such as water towers and the faces of buildings. The impact of these new technologies has been particularly pronounced in manufacturing districts, where there had been no limits on signs beyond 200 feet of highways and parks. Unlike the situation when the Zoning Resolution was originally enacted, by 2001, outdoor advertising companies could economically erect sign structures in manufacturing districts that were large enough to reach audiences in other districts with the new technologies.

The harm caused by these signs of unlimited size was compounded by the fact that, as manufacturing districts increasingly allowed for mixed uses, particularly in SOHO, NOHO, and Tribeca, more and more people were living and working in these districts. See City Planning Commission Report 2-4 (Dec. 13, 2000); Hearing Before the City Planning Commission 10-11, 79 (Nov. 29, 2000). As a result, one City Council Member, Kathryn Freed, testified before the City Planning Commission that in mixed use manufacturing districts:

Hearing Before the City Planning Commission 10-11 (Nov. 29, 2000).

In addition, the City Planning Commission heard testimony that, near highways and parks, there was a common practice of obtaining permits for accessory use signs and then illegally converting the signs to advertising signs in violation of the Zoning Resolution, and that this had caused a proliferation of advertising signs. See City Planning Commission Report 30 (Dec. 13, 2000); Hearing Before the City Planning Commission 3, 6 (Nov. 29, 2000). For example, testimony from the Brooklyn Deputy Borough President Jeanette Gadsden indicated that the number of advertising signs within 200 feet of an arterial highway in Brooklyn increased from 26 in 1994 to 140 in 2000. Hearing Before the City Planning Commission 3, 6 (Nov. 29, 2000); City Planning Commission Report 22 (Dec. 13, 2000). And data provided to the DOB by the Hudson River Park Trust indicated that, of the 41 complaints regarding signs along Miller Highway (the West Side Highway), four were non-advertising signs, one sign had been grandfathered, one sign was blank, and the remainder were in violation of the Zoning Resolution. Memorandum from Michael Bradley, Hudson River Park Trust, to Peter Prescod (Sept. 20, 1999). Even Timothy Stauning, President of New York Outdoor Group, an industry group to which plaintiff belongs, acknowledged that the practice of illegally converting accessory use signs to advertising signs is common. Hearing Before the City Planning Commission 73-76 (Nov. 29, 2000).

In response to this problem, the City reduced the economic incentive to illegally convert accessory signs to advertising signs, by limiting the size of accessory signs near highways and parks. The City concluded that, if the size of accessory signs were smaller, outdoor advertising companies would be less willing to obtain permits for accessory signs and then switch the copy to advertising. See City Planning Commission Report 30 (Dec. 13, 2000); Hearing Before the City Planning Commission 4, 8 (Nov. 29, 2000).

However, the City Planning Commission was careful not to eliminate all signs. Recognizing the importance of the outdoor advertising industry to the City and the importance of allowing merchants to reach their customers through advertisements, the City ensured that some signs would continue to be permitted in some locations. The City merely sought to combat the signs that caused the most aesthetic and traffic safety harm: all advertising signs near highways and parks and the mega-signs that had developed in manufacturing districts. See City Planning Commission Report 32-33 (Dec. 13, 2000).

In sum, under the current Zoning Resolution, advertising signs are allowed, subject to regulation of size and other qualities, in some commercial districts and all manufacturing districts, so long as they are not within 200 feet of an arterial highway or public park, or located at a distance from the highway or public park in linear feet equal to or greater than their size in square feet. Accessory signs and noncommercial signs are allowed in all commercial and manufacturing districts, but they are subject to stricter size regulations near highways and parks.

D. ENFORCEMENT OF THE ZONING RESOLUTION

The Administrative Code requires a permit before a sign structure is erected, installed, altered, repaired or used. New York, N.Y., Administrative Code § 27-147 (2000) ("Administrative Code"). In order to obtain a permit, an applicant must certify that the proposed work complies with the Administrative Code and other applicable laws and regulations, including the Zoning Resolution. Id. at § 27-142. Following the 1998 amendments to the Zoning Resolution, the DOB conformed its permitting practices for signs near highways and parks to the 1998 Zoning Resolution, as amended. See Operations Policy and Procedure Notice # 10/99 ("OPPN # 10/99"). OPPN # 10/99 requires all applications for sign permits to identify whether the proposed sign near a highway or park is an advertising or non-advertising sign, whether the proposed sign is visible from an arterial highway or public park, the distance of the proposed sign from an arterial highway or public park, the proposed copy, and the size and location of the proposed sign. See OPPN # 10/99 § I, 1.

Before approving or issuing a sign permit for an application for a sign that is required to be examined or audited because of the proximity of the sign to an arterial highway or public park, the applicant must demonstrate that the sign is not an advertising sign. That is, the applicant must demonstrate that the sign is either a non-commercial sign or that the sign is ...

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