D. C. Court of Appeals Invalidates FCC Internet Discrimination Rules

What does the D. C. Circuit, U. S. Court of Appeals, decision that struck down part of the FCC Rule, “…to compel broadband providers to treat all Internet traffic the same regardless of source…” mean for local government?  At issue in this case was the FCC Network Neutrality Report and Order  that established three basic Rules discussed in my earlier 2011 Post.

FCC Adopts Anti-Discrimiation Rules

FCC Adopts Anti-Discrimination Rules

The Rule adopted by the FCC required transparency by fixed and mobile broadband providers and prohibited fixed broadband providers from blocking services and unreasonable discrimination. The no blocking Rule prohibited a fixed broadband provider from blocking lawful content, applications, services, or non-harmful devices. Mobile broadband providers could  not block applications or websites that compete with their voice or video telephony services. Fixed broadband providers could not unreasonably discriminate in transmitting network data. The Rules also make it clear that a fixed broadband provider may charge more for heavy users than light users and that they may offer tiered and usage based pricing.

The 81-page decision by the D. C. Circuit found that the Rule adopted by the FCC prohibiting broadband providers  from blocking services and unreasonable discrimination was invalid although it left in place part of the Rule, which requires disclosure (transparency) of the ISP’s network management practices. The opinion also found that the FCC has authority – that it had not exercised – to adopt rules to encourage the deployment of broadband or reclassify broadband as a common carrier although this means going back and starting over. The Rule adopted by the FCC was flawed primarily because it tried to treat ISP’s as “common carriers” which is expressly prohibited by law.  It was like the FCC  can make this cake but this cake had the wrong ingredients,  so it flopped. Go back  and make the cake with these ingredients so it won’t flop. Also be very  careful how you mix the ingredients to avoid another cake flop.

U. S. Court of Appeals for the D. C. Circuit invalidates FCC Rule on Net Neutrality

U. S. Court of Appeals for the D. C. Circuit invalidates FCC Rule on Net Neutrality

The next step in the process could be an appeal to the United States Supreme Court.  Caution might be the better part of valor for the FCC in this case because unbiased critics suggested even prior to the decision that the FCC Rule was basically flawed.  In that respect, the Court’s opinion shreds the FCC’s reasoning giving it little hope of getting this decision reversed although it is possible that a party adversely affected by the requirement of the disclosure of management practices   might file a petition asking the Supreme Court to review the decision.

If the case is not appealed, the FCC will have to decide if it wants to meet the challenge by adopting a new rule to reclassify broadband as a common carrier or a rule to encourage deployment of broadband, thereby providing a much stronger legal foundation.  This will not be easy and another long hard fought legal/political battle would lie in front of any such rule. Another possibility is to wait until something dramatic happens, proceed with cases on an ad hoc basis or wait until enough information is gathered to provide a stronger basis for rule making although the opinion of the D. C. Circuit suggests that there is already a pretty good factual basis for new rule making. If the FCC waits too long practices may become entrenched making it difficult to root them out. Ad hoc decision making  while having the advantage of dealing with the facts of an actual controversy – creates uncertainty with rights, duties and obligations of the ISP’s and works to the disadvantage of  those who do not have the resources to challenge business giants.

There are claims  that blocking or charging some customers for access to the network will decrease competition and make it more difficult if not impossible for new companies to enter the market. See PBS article.  Of course, the opponents of the FCC Rule claim otherwise suggesting that the ability to charge and block services will encourage deployment of more fiber. How does that work? It seems the idea is that by being able to charge users for faster service  the revenue  steam will encourage improvements to the broadband system although another likely scenario is that they will pocket the change.

With the principles set forth in the Rule  to block Internet discrimination in shreds the big ISP’s business giants can legally block or limit access to the disadvantage of consumers and businesses that are trying to enter the market. According to a recent New York Times article  the United States – despite having created the Internet – has fallen behind many other countries in the deployment of high-speed broadband.   Innovation depends heavily on having good Internet infrastructure with the speed to rapidly move large amounts of information. 

With the legal right of ISP’s  to discriminate the focus shifts to  the battle over who controls the last mile to the customer’s home or business. As a practical matter due to the extremely high costs of building out the last mile or so of the system there will always be a limited number of competitors meaning that the company that controls the last mile can exercise a premium or even block competitors under current rules. To allow discriminatory practices to exist between customers gives the ISP’s the ability to choose winners and losers creating an uneven playing field. While the opinion from the D. C. Circuit  rejected the common carrier model in the existing regulatory structure it seems to me that if properly tuned for 21st Century technology the common carrier model offers a pretty good regulatory prototype  for building a system that could provide for net neutrality. Of course, that would require new legislation or a giant leap by the FCC  under its existing regulatory powers by reclassifying broadband as a common carrier, which most observers consider to be an unlikely move by the FCC.

What we are seeing is that Goggle – one of the giants –  decided to not wait for others to build the last mile, so it  built its own  Goggle Fiber network in  Kansas City.  A friend who lives in Kansas City – now a Goggle wired city –  enjoys broadband speeds at 1 gigabit per second and full cable television for $125 per month. Everyone in his condo has switched  to Goggle Fiber for 1/2 the price with 100 times higher internet speeds and better cable. Looks like a big time  wipe out of Time Warner cable and internet services in KC and a big shot across the bow of other ISP’s that Goggle will go the last mile. My personal experience in Springfield, Mo. was that the local cable company did not provide good high-speed internet service or good cable services until they realized the  City was contemplating its own high-speed city wide fiber system at which time the cable company updated their system to deliver faster internet speeds and better cable television service and crushed any hope with massive scorched earth litigation.  The basic idea of the City to build one fiber pipe line open to everyone on equal terms. That would have produced real competition but never got off the ground.

Other communities are lining  up trying to figure out how to develop similar public/private partnerships like KC.  Austin, Texas  is next for Goggle Fiber. The success or failure of these programs and their impact on a community may do more than anything else to drive the deployment of higher internet speeds and broadband leading to an economic renaissance for some lucky communities.

In my 2011 blog I explored  the question posed by Professor Wu in his book “The Master Switch.”  Is the Internet fundamentally different from earlier communication systems that resulted in monopolies? Will the structure of the Internet allow it to fend off discriminatory practices or will it remain open or will some company control and dominate the Internet? Master SwitchToday the answer from the D. C. Circuit  is that internet discriminatory practices are allowed,  although the final answer to this question remains muddled. Allowing discriminatory practices is no small matter. Remember John D. Rockefeller’s  Standard Oil Trust – one of the largest monopolies we have ever know – was built on discriminatory pricing and the remnant’s of the 1984 ATT breakup are still trying to consolidate.

For sure communities without fully deployed high-speed Internet services may be left in the electronic dust of other more wired communities. Right now thanks to Goggle we are in a real live time test that will measure the effect of  high-speed internet on the economy of communities by comparing those with and without 21st century really high speed internet services.  Stayed tuned to see  how this all plays out.

Howard Wright@ 2014

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Set back for red light camera ordinances

You know that red like camera cases have attracted the attention of the court when the 56-page opinion in Brunner vs. City of Arnold, starts with a statement that ”…we take another hike through a legal, unfortunately, political minefield” citing a list of five decisions on red light camera cases decided mostly within the last year several of which have been in the last several months. Since Edwards v. City of Ellisville was decided in early November of 2013 we have had two more red light camera cases bringing the total to seven cases plus there is another one in the Court of Appeals pipeline.

Each case has somewhat different facts and varying results on different issues. Someone is going to have a lot of fun sorting out the distinctions and issues between these cases. With potentially millions of dollars at stake, looming class actions, and a multiplicity of thorny legal issues it was recently reported in Lawyers Weekly that  Judge Wolff, former Missouri Supreme Court Justice, now Dean of the St. Louis University Law School has been hired by ATS to help the Missouri Supreme Court sort this out.

St Louis University  Law School

St Louis University Law School

Do not enter on red

Do not enter on red

In Damon v. Kansas City decided November 26, 2013 the Court of Appeals for the Western District entered the fray for the first time. In Damon the Kansas City (City) red light camera ordinance (Ordinance) prohibited a vehicle from being driven into an intersection controlled by a traffic control signal at which an automated traffic control system is installed while the traffic control signal facing the vehicle displays a steady red signal, including a steady red arrow. The Ordinance and notices of violation state that no points will be assessed against the defendant’s license for a violation of the Ordinance. Since the KC Ordinance clearly described a state law moving violation (running a red light) and prohibited the assessment of points, which is required by state law the Ordinance was in conflict with state law and was void and unenforceable. Complicating the issues for ATS is an opinion from outside legal counsel to ATS set forth in the pleadings that any ordinance adopted by a city which  “…circumvents the Director of Revenue’s point system for suspension and revocation of motor vehicle licenses without legislative authorization to do so” would conflict with state law.

In addition, the pleadings alleged extensive involvement of ATC in the process to determine who would be charged with a violation of the KC Ordinance and a confusing and somewhat contradictory process for responding to the charge. Therefore, based on these allegations the Western District found that the Damon could challenge the ordinance even though he had paid the fine and that he could serve as a representative of a class to obtain refunds for fines that had been paid because there was no waiver or estoppel due to the confusing and contradictory notice. Similarly, Olinetchouk another plaintiff in the case, had standing to bring a declaratory judgment even though he had not paid a fine nor taken any action before the municipal court to challenge the Ordinance and could serve as a representative of a class similarly situated. In addition, the court seriously questioned the use of the rebuttable presumption making it clear that if the trial court found that the Ordinance was criminal in nature it was invalid. The Court also seriously questioned the role of ATC in the process to determine who would be charged and where to pay the fine.

In Brunner vs. City of Arnold, the court considered the City of Arnold’s (City) red light camera ordinance, which provides that the camera shall take a picture of the intersections steady red light, the vehicle proceeding through the red light, and the license plate of that vehicle from the rear. The ordinance specifically prohibits photographs of the vehicles occupants, particularly the driver. The police review the pictures and forward violations to the prosecutor who then decides whether or not to file an information charging the violator with a violation of the ordinance. If the prosecutor files the information the municipal court clerk issues a summons by mailing notice of the violation with the photographs to the owner of the vehicle. The ordinance creates a rebuttable presumption that the owner of the vehicle violated the ordinance based on the picture of the vehicle running the red light. Brunner received a notice of violation and paid a $94.50 fine to avoid further legal action (a warrant for his arrest).

What is different about Brunner vs. City of Arnold, from earlier cases is that the court concludes after finding the ordinance conflicts with State law that it is void ab initio, therefore the municipal court had no subject matter jurisdiction.  Consequently a person charged with a violation of the Ordinance is not required to challenge the Ordinance before the municipal court but may file a separate action. Since the Ordinance is void a person charged with a violation of the Ordinance has standing to file a petition for a declaratory judgment without having to exhaust administrative remedies. In addition, Brunner – who had already paid his fine – could not recover the fine from the City but may have a claim against ATS for unjust enrichment and could serve as representatives of a class to recover against ATS fines already paid based on the proposition that the City was proceeding illegally when it threatened Brunner. Moore another plaintiff in the case – who had not paid his fine – could serve as a representative for persons who have been charged but have not taken action to pay the fine.

Of equal significance the court also found in the Arnold case that the rebuttable presumption that the owner of the vehicle was the driver of the vehicle that ran the red light was invalid because the ordinance was criminal in nature and presumptions that are rebuttal in criminal matters are void and unconstitutional violating due process of law. This was a significant departure from other decisions taking the earlier decision in Damon v. City of Kansas, to another level.

Even though your city may not have a red light camera ordinance there are a number of important issues in these cases that have widespread application to local government. Stay tuned as we wait for the next chapter in this ongoing legal saga.

For a discussion of the status of the red light camera cases  prior to November 2, 2013 see this Post , which will be  updated  to reflect  ongoing changes in the law.

Howard Wright @ 2014

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One of the most difficult and   complex decisions  facing local government officials is determining whether or not a charge is a tax and a fee. The tax/fee question has bedeviled  local government  officials for years leading at times to what would seem to be a  life and death struggle for financial solvency of the political subdivision.  This decision is important because if the charge is a new tax or an increase in an existing tax it must first be approved by the voters as required by article X, section 22 of the Missouri Constitution, otherwise the tax is invalid leading  to  dire consequences, like what recently happened in  Zweig, et al., v. The Metropolitan St. Louis Sewer District.

In the Zweig case   the Missouri Supreme Court invalidated a storm water impervious use charge holding that this charge was a tax and was invalid because it had not been approved by the voters. This decision left the St. Louis Metropolitan Sewer District with a shortfall of  billions of dollars (unless the voters approve additional revenues) in complying with a multibillion dollar consent decree with the State of Missouri and the EPA, as well  a  5.4 million dollar plus  award of attorney fees. If that does not take your breath away and bring you to your financial knees I do not know what it takes.

Considering the difficulties political subdivisions were having in determining if a charge was a fee or a tax the Missouri Supreme Court went to great lengths to provide a clear analysis for local government in  the  Zweig decision stating in so many words that political subdivisions were not hearing the the Court’s unambiguous message Prior to Zweig, most  local government lawyers thought that the test established by the Missouri Supreme was difficult to apply and was flawed creating great uncertainty in advising local governmental officials as to whether or not  a charge was a fee or a tax. 

The Court in Zweig  tells us that local government officials have over analyzed the problem and have gotten lost in the forest by applying the five-part test Keller test as a “divining rod” like it was a math problem where you simply added up the five-part Keller factors  instead of using the five-part Keller test along with other factors to help determine if a charge is a tax or fee including cases prior to the Hancock Amendment. The Court also emphasized that local government officials were structuring the charge to meet the five-part Keller test in order to reach a result instead of simply applying the five-part Keller test and other factors losing sight of the fact that case law well before the adoption of the Hancock Amendment defined what constituted a tax.  

The Missouri Supreme Court in Zweig, held that the impervious stormwater charge made by the Metropolitan St. Louis Sewer District ( MSD) was a tax.  It is difficult to find anything positive for local government in this decision other than analytical framework, which the court carefully lays out in its 52 page opinion how to determine whether or not a charge is a fee or a tax under article 10, Section 22 of the Missouri Constitution. 

Facts and Procedure: MSD imposed a stormwater user charge generally based upon the amount of impervious surface that was on the property against certain persons within the District. Plaintiffs, (Ratepayers) on behalf of themselves and a class of similarly situated ratepayers sued MSD seeking declaratory, injunctive, and monetary remedies on the ground that MSD violated article X, section 22(a) of the Missouri Constitution when it implemented its stormwater user charge without prior voter approval.

The trial court declared MSD’s action unconstitutional, enjoined future collection of the charge, and ordered MSD to pay the ratepayers’ attorneys’ fees and other expenses. The trial court, however, refused to order MSD to pay damages or refund charges already collected. MSD appealed the trial court’s decision on Ratepayers’ constitutional claim and the award of Ratepayers’ attorneys’ fees and expenses. Ratepayers cross-appealed, claiming that the trial court erred in refusing to enter a money judgment against MSD for the amounts already collected. The Missouri Supreme Court affirmed the trial court’s judgment in all respects.

Analysis: MSD characterized the stormwater charge as a user fee paid to ensure the ”continuous and ongoing” availability of the storm water drainage system rain or shine. Despite this characterization the basic flaw in MSD’s argument was that a user fee must be charged in exchange for, based upon, an individuals use of the service. “A tax need not be tied to the payer’s use of a political subdivision service, but a user fee must be.”

Before launching into the five-part Keller test the court takes apart Keller going back to basics by focusing on the key distinction from which the holding in Keller is based.  What article 10, section 22 prohibits without a vote of the people is a political subdivision from levying new or increased taxes. A levy is “… to impose or collect (as a tax or tribute) by legal process or by authority.” A tax creates an obligation to pay that is not contingent upon the actual use of the political subdivisions service. In the Keller case the ambulance district was not levying a tax because it was just increasing the price it could charge a patient for using its services. Furthermore, the five criterion in Keller are only intended to adopt the pre-Hancock test for a tax in a new constitutional context, not replace it completely. In Arbor Inv. Company v. City of Hermann the court emphasized that the “… Keller criteria are to be used only as reliable indicators, not constitutional divining rods.” When determining whether or not a charge is a fee or tax first look to Leggett, to determine if the charge was a tax or fee prior to Keller.

In applying the Keller criterion the court starts with Keller criterion No. 4What services does MSD provide in exchange for the fee? MSD took the position that the users were paying for the availability of the stormwater system. The court concludes that MSD did not impose a charge in exchange for the individual’s actual use of those services making the charge more like a tax.

Keller criterion No. 2:  Who pays – owners or users? MSD tied the payment for the stormwater charge to the ownership of the land thereby assuring that overtime the charge would be paid regardless of any individual use of the stormwater services. This made the charge more like a tax then a fee.

Keller criterion No. 1: When is it paid– Regular or after use? The charge is paid periodically for the use of the storm water system based on ownership of the land regardless of whether or not the services are used indicating that the political subdivision had levied a tax.  There is no way to tell when such services are actually use weighing heavily in favor that MSD was not imposing a stormwater charge as a user fee.

Keller criterion No. 3: How much to pay–fixed amount or based on usage? MSD charges based on each landowners contribution to the overall need not for stormwater services, not the owners actual use of storm water services. Because there is no individual user availability for such services any possibility that the stormwater charge is a valid user fee is precluded.

Keller criterion No. 5: Is the service historically and exclusively governmental? There was no evidence that any private entity provides (or ever has provided) availability of a stormwater system for individual landowners as MSD claims to do; Therefore, the Application of the fifth Keller criterion suggests that MSD was imposing a tax not really setting a price for the storm water user charge.

Additional factors:  The court considered the lien for nonpayment as a factor that made the charge a tax. In addition, the remedy of shutting off water utilities was not related in any way to be stormwater charge; therefore the charge looked like a tax.

Refunds. The court affirmed the trial courts ruling that payment of the stormwater taxes  were not refundable. This is consistent with the general rule that a taxpayer is not entitled to a refund of illegal taxes unless a law authorizes the refund. There is no refund provision in section 22(a) of the Hancock amendment.

Attorney fees. The court affirmed the trial court’s decision allowing for attorneys fees in the amount of $4.3 million (includes a multiplier of 2) and an additional amount of $470,000 in expenses based upon an earlier decision. With respect to the attorneys fees the court noted that the fees were regrettably since the parties could have easily stipulated to most of the facts thereby avoiding expensive expert witnesses and prolonged litigation.

The opinion of the court provides a well-defined process for analyzing whether or not a charge is a fee or a tax helping us advise local governmental agencies. Considering the results in Zweig it behoves local government officials to focus in its analysis on the key cases cited by the Supreme Court (Leggett, Keller, Hermann and Zweig) when determining if a charge is a fee or a tax.

Despite the harsh criticism by the Court in Zweig  many states have treated impervious storm water runoff charges as fees using what is referred to as the “utility model.” This approach makes sense but unfortunately it just does not work under the Hancock Amendment to the Missouri Constitution. 

Howard Wright @ 2013

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Ellisville Red Light Camera Case Sets Stage for Review by Supreme Court

A new ruling by the Missouri Court of Appeals, Eastern District sets the stage for the City of Ellisville red light camera ordinance to be reviewed by the Missouri Supreme Court. As noted in an earlier Post  red light cameras ordinances are currently one of the most litigated  and contested areas of local government law.

Photo Red Light Camera

Photo Red Light Camera

In Edwards v. City of Ellisville, the court held that the Ellisville red light camera ordinance conflicts with state law because it regulates the same conduct as section 304.281 RSMo. The court concludes that “being present” in an intersection during a red light is the equivalent of running a red light. “Logically, a vehicle cannot travel into an intersection or fail to stop when the traffic signal is red without movement – i.e., running a red light.” Judge Odenwald did get some help from the notice by Ellisville to the alleged violator, which informed the alleged violator that: “your vehicle has proceeded into an intersection by crossing the stop line when the traffic control signal, for the direction in which your vehicle was traveling, was emitting a steady red signal” and that “red light running” endangers both drivers and pedestrians.” (Emphasis added by the court).

In addition to finding a conflict with state law that prohibits running a red light the court found that the ordinance conflicts with state law that makes running a red light a moving violation, which requires the assessment of points under A moving violation is plainly defined by state statute as “that character of traffic violation where at the time of violation the motor vehicle involved is in motion.” Section 302.010(13). “The definition of a moving violation is fundamental to the interpretation of Section 302.302, which establishes Missouri’s point system for the suspension and revocation of licenses.” The court notes that:  “Both the Ordinance and the accompanying Notice of Violation state that an infraction of the Ordinance constitutes a non-moving violation. As a consequence based on the determination that the ordinance is really “running a red light” the charge is a moving violation, in conflict with state law.

Missouri Supreme Court Weight in on Collective Bargaining

Missouri Supreme Court – It is their turn

If the Missouri Supreme Court takes Ellisville case other issues decided in favor of local government would likely be considered giving us a panoramic view of related issues to this area of the law. Stay tuned.

Howard Wright @ 2013

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Cannot ban distribution of bibles at Twin Cities Pride Festival

Local governments engage in all sorts of partnerships with groups who have festivals or other activities on public property.  Most of the time the city encourages these activities since they generate interest in the community, are sources of community pride, and create economic activity. Other times groups or individuals just show up and solicit, beg, or perform.  How does the city get involved? The city drafts ordinances for the use of public property or contracts to allow the use based on an agreement. Many times the city just turns the property over to the user who runs the event based upon the contract.

These activities can generate large crowds interested in the event, but the activity also attracts others who want to distribute information by walking through the crowd, persons who want to set up booths to sell or distribute their products, street performers, or persons who want to express their views. Consider the examples of Reverend Johnson who wanted to hand out bibles at the Pride Festival, the street preacher with a megaphone at the Springfield Jazz Festival, or a street performer in St. Louis. In short, these events or activities on public property do not necessarily make for one big happy family. The variety of activities makes this challenging even for the most engaged city trying to do the right thing.

So how do you deal with these events in order to avoid throwing the city into an unnecessary and expensive litigation? First,  you need to look over your insurance policy to be sure these events are covered and the insurance carrier has a duty to defend. Cost to litigate can run into hundreds of thousands of dollars and if the other side wins you may be looking at a total bill in excess of a half million dollars. Also make the user carry insurance if possible and indemnify the city as part of the agreement or license to use.

You need to recognize that sometimes a protester may  just want to provoke you into overreacting in order to grab the headlines and get a counteraction. Obviously that is exactly what Westboro Baptist Church is trying to do with their outrageous statements that God is taking his revenge on America by the death of members of the armed services. A recent article in The Atlantic by Jonathan Rauch illustrates how counterproductive hate speech can be, so do not overreact and if you react give it careful thought. Does anyone believe that the provocative statements by Westboro Baptist Church have hurt the gay movement?

Another way is to write ordinances that are neutral and apply across the board that have a public safety rationale. Consider the situation where the Klu Klux Klan wanted to hold a rally in a city park and burn an American Flag.  In Springfield, Missouri that would have in all likelihood provoked a reaction putting the police in the middle trying to keep protesters and anti-protestors apart. Since burning the American flag can be an expression of protest implicating the free speech clause, you cannot lawfully prohibit just the burning of the American flag. The answer was to fall back on the public safety concept by only allowing fires to occur in a grill or fire-place pit for burning established or permitted in the park for burning. In other words, no burning of anything on city property (sidewalks, parks or other public places) except in a device that is designed for the burning of materials. Grilling or burning an American flag in a pit somehow does not seem to have much impact. 

Bound to Incite

Bound to Incite

You also need to scrutinize your agreement to make sure everything is covered and recognize that the interest of the city may be adverse to the user of the property.  The City should try to be neutral and not take sides in a dispute between the user of city property and third parties unless it is clear that the actions are disruptive.

 Johnson v. Minneapolis Park and Recreation Bd. is a good example of how complicated and convoluted these relationships can get. In that  case the Minneapolis Park and Recreation Board (“the Board”) oversaw Loring Park, a 42-acre public park in downtown Minneapolis that  was the site of the two-day Pride Festival. Twin Cities Pride, a nonprofit organization, whose mission is to create experiences that bring the gay, lesbian, bisexual, and transgender community hosts a two-day festival in Loring Park. Twin Cities Pride’s use of the Park during the Festival is nonexclusive, and admission to the park remains free and open to the public.  Participants must apply to Twin Cities Pride to operate booths from which they may distribute or sell their wares.  The organization sanctions participants only if they sign a “non-discrimination statement,” providing that the applicant does not “discriminate in hiring, employment, participation or services rendered based on the fact or perception of a person’s race, color, creed, religion, national origin, ancestry, age, sex, sexual orientation, gender identity, domestic partner status, marital status, disability, or Acquired Immune Deficiency Syndrome or HIV status.” 

Twin Cities Pride Festival

Twin Cities Pride Festival

Johnson a self-described “professing Evangelical Christian,” distributes copies of the Bible “essential to his expression” and distributed bibles at the Festival starting around 1995 and thereafter, he secured an exhibitor’s booth from Twin Cities Pride. In 2009 Johnson signed an application and the non-discrimination statement, but the Festival Manager asked him three more questions: whether his activities at the Festival would “meet the intentions” of the non-discrimination statement; whether he believed that homosexuality or homosexual sex acts are sins; and whether he believed that sexual intercourse between persons of the same-sex is a perversion.  Johnson replied that he would “gladly hire a homosexual at my business if he/she could do the job,” but expressed his belief that the Bible specifies homosexual conduct as a sin.  He elaborated that he tries to avoid the subject of homosexuality when passing out Bibles at the Festival, and he does not believe that homosexual or heterosexual temptations, in and of them, constitute sin.  The Festival Manager was not satisfied by this reply and declined to approve the application.  Having no booth, Johnson attempted to distribute Bibles while walking through the park during the Festival, but Minneapolis police arrested him for trespassing when he refused to leave.  The charge was later dismissed.

Now this is where it gets complicated. In anticipation of the 2010 Festival, Johnson requested and received from the Board assurances that he would not be forbidden to distribute literature within Loring Park during the Festival.  After learning that the Board intended to allow Johnson to distribute Bibles, Twin Cities Pride brought an action against the Board pursuant to 42 U.S.C. § 1983, alleging that allowing Johnson to distribute literature during the Festival violated Twin Cities Pride’s rights under the free speech clause of the First Amendment.

The federal district court denied Twin Cities Pride’s motion for a temporary restraining order finding that the festival was a public forum.  Therefore, Johnson was entitled to speak and hand out literature, quintessential activities protected by the fee speech clause so long as he was not disruptive.  Johnson attended the 2010 Festival and distributed Bibles without incident.  However, in a footnote to its 2010 ruling, the district court responded to Twin Cities Pride’s request for “guidance” and suggested that “a compromise may be available.” by designating  ‘free speech zones’ on the Pride Festival grounds in which anyone who wishes to distribute literature or display signage may do so.”  Litigation resumed after the 2010 Festival resulting in the Board and Twin Cities Pride prohibiting the distribution of literature and the display of signage not authorized by Twin Cities Pride, except in booths and “free speech zones.”  The Board than adopted a resolution that prohibits an attendee like Johnson from personally distributing literature in Loring Park during the Festival except from a booth. At this point it is pretty clear that the City and Twin Cities Pride were working together.

By now Johnson was  well-educated so he  sued again based on a violation of his  right of free speech requesting a preliminary injunction against enforcement of the regulation on literature distribution.  The district court ruled for the Board and Twin Cities Pride and Johnson appealed to the 8th Circuit, which held that the regulation was underinclusive because it restricted a medium of speech in the name of a particular interest but leaves unfettered other modes of expression that implicate the same interest like performers.   Jonathan Turley Law Professor at George Washington University suggests in a recent blog that the decision by the 8th Circuit is a welcome sign that could help curtail designation of areas where citizens are limited to distribution of  information as a means to stifle free speech.

The time energy and money spent on these cases had to be enormous since someone (Twin Cities Pride or the Board) was paying the attorney fees for Johnson plus their own fees over the course of several years of extended litigation.  It seems that the contract should have reserved to the Board the absolute right to adopt regulations governing the activity and should have required Twin City Pride to accept such regulations as a condition of the use of the property, which might have been sufficient to deter them from suing the Board based on its highly questionable free speech claim.

For a similar result involving regulations of street performers a district court granted a preliminary injunction against a St. Louis ordinance licensing street performers where the public works licensing officials asked street performers to come on down to the office for an audition (a nice headliner nugget which was said but did not happen). See Pence et al., v. City of St. Louis.

Bottom line is with a little checking you can limit your risks and avoid the big lawsuit while enjoying the benefits of these activities.

Howard Wright @ 2013

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Photo Red Light Camera Cases

Three recent cases discussed in my Post on January 13, 2014  “Red light camera ordinances suffer setback” have changed a number of conclusions in this Post. Since some of these cases are not final and the law at this time is in a state of flux I am waiting until we get a final decision from the Missouri Supreme Court before I revise this Post. Hopefully,  the impact on a number of statements in this Post can be gauged by my Post on January 13, 2014.

Red light camera ordinances have been one of the most hotly and frequently contested issues in recent times.  Lining up are proponents who believe that traffic safety can be improved by slowing down vehicles to the speed limit and by reducing the number of serious accidents at intersections where there are red light cameras. For a general discussion on the use of red light photo cameras in Missouri see my earlier Post. I confess,  I am a believer based on my own personal experience as a city prosecutor that the use of photo red light cameras can reduce serious accidents at controlled  intersections. See my earlier Post on Red Light Photo Camera Update.

Photo Red Light cameras help prevent serious T bone accidents

Photo Red Light cameras help prevent serious T bone accidents

Opponents are vociferous in their opposition arguing that red light cameras are just a way to raise revenue and deny citizens their rights.

Procedures for red light cameras take away our rights

Procedures for red light cameras take away our rights

In the last several months we have had three cases involving photo red light cameras all from the Eastern District. Many of the important issues have been resolved in favor of local government but there have been some technical glitches and at least several major issues still remain to be resolved. Principles established by these cases are as follows:

  • If notice of the municipal court violation of the ordinance is proper there is no right to declaratory and equitable relief because there is an adequate remedy at law in municipal court to challenge the ordinance.
  • Cities have authority (charter or 304.120 RSMo.) to enact traffic ordinance under its police power because traffic regulation is rationally related to public safety and welfare.
  • There is no claim for unjust enrichment or return of the fine for a violation of a city ordinance when it has been paid voluntarily.
  • There is no waiver of defendants right to challenge an ordinance in municipal court when the city fails to give notice of a court date and time and information on how to challenge the violation as required by the Supreme Court Rules governing municipal court.
  •  Rebuttable presumptions are valid in Missouri.
  • The photo red light camera ordinance adopted by Creve Coeur creating a “violation of public safety”  a non moving violation does not conflict with state law while the ordinance adopted by Florissant conflicts with state law since it is based on running a red light, a moving violation, which  city officials were prohibited from  reporting  to the DOR,  in an apparent attempt to avoid backlash from the assessment of points on the driver’s license.
  • A challenge to a red light camera ordinance on the grounds that it was enacted just to raise revenue – not for safety purposes – is a fact question as to whether or not there  is a  rationale basis for the ordinance. Fact questions cannot be determined based on a motion to dismiss.

The  cases establishing the above principles are discussed below.

St. Louis Case 

The first case Smith v. City of St. Louis (City) was a class action and a declaratory judgment challenging a City ordinance, which authorized the installation and use of red light cameras at dangerous intersections to detect and prosecute violations of existing City traffic ordinances pertaining to traffic signals. The Ordinance created a presumption that the owner of the motor vehicle was the operator of the vehicle at the time and place of the violation, thereby allowing prosecution against the owner of the vehicle. A statement from the owner may rebut the presumption that the vehicle was being operated by a person other than the owner or that the vehicle or its license plate was stolen. The City filed a motion for summary judgment, which was denied and granted in part.  The parties appealed to the Eastern District.

Court of Appeals - Eastern District

Court of Appeals – Eastern District

The Eastern District held that there was no waiver of the right to challenge the St. Louis ordinance by paying the fine as directed in the notice of violation because the notice provided to the motorist was insufficient to comply with state court rules by failing to give of the time and place as well as how to challenge the charge in court. Notices should follow exactly the rules that govern municipal court violations; therefore the ordinance was invalid as applied, although the voluntary payment doctrine precluded the motorist from receiving a refund of the fine that was paid. The court further ruled that the City ordinance was a valid exercise of the city’s police power under the city charter and the state law (304.120.2) governing the rules of the road.  In addition, to the extent the petition claimed equitable relief there is an adequate remedy at law in municipal court; therefore there was no right to a declaratory judgment. For a   discussion of the trial courts decision in the St. Louis  case see my earlier Post, which predicted that the decision of Judge Neill would be reversed. 

City of Florissant Case

Appellant’s received red light camera tickets from the City of Florissant (Florissant) stating that they had committed a “Violation of Public Safety (Failure to Stop at a Red Light)” in violation of a Florissant municipal ordinance (“the Ordinance”). Appellants’ alleged the Ordinance violated their due process rights and the privilege against self-incrimination; sought declaratory judgment regarding the validity and constitutionality of the Ordinance and its enforcement; asserted a claim of civil conspiracy; and asserted claims of unjust enrichment. Florissant and ATS filed motions to dismiss Appellants petition alleging, that Appellants’ constitutional claims should be dismissed on the basis of standing, waiver, and estoppel, which was sustained. The trial court also addressed the Appellants’ substantive issues and dismissed each count with prejudice. Appellants’ appealed part of the trial court’s judgment to the Eastern District.  

The Eastern District held that Appellants, Cusumanos had an adequate remedy at law to challenge the proceedings in municipal court because the summons they received provided the date and time and information concerning their rights to challenge the violation. With respect to the claims brought by Appellant, Unverferth, the petition alleged that the notice provided to Unverferth did not have the date to appear or how to challenge the charge; therefore the Eastern District reversed holding that Unverferth had standing to challenge the Ordinance and that she did not waive her claims, remanding these issues for further proceedings.

The Eastern District also reversed the trial court’s judgment declaring the Ordinance valid and dismissing Count I since the Appellants plead that Florissant exceeded its authority by enacting the Ordinance for the purpose of raising municipal revenue and not to regulate traffic or promote safety, which is a fact question that cannot be decided by a motion to dismiss.  In addition, the judgment of the trial court dismissing Appellants’ claim for declaratory judgment was also reversed because the Ordinance conflicts with state statutes regulating moving violations by directing that Florissant not report to the DOR violations for running a red light. Appellants adequately plead that the Ordinance and its application denied them notice, a fair hearing, and adequate procedural protections as required under Missouri Supreme Court Rules and Article I, Section 10 of the Missouri Constitution.  Whether the Ordinance, as enacted or applied, violated Appellants’ procedural due process rights is a factual question that is not appropriate for resolution on Respondents’ motions to dismiss. Appellants are entitled to pursue discovery and present facts in support of properly pleaded allegations.  The Eastern District affirmed the trial court’s judgment in all other respects.  Unverferth v. City of Florissant

Creve Coeur Case

Respondents received violation notices from Creve Coeur alleging that they had violated Creve Coeur’s red light camera ordinance (“the Ordinance”) and challenged the Ordinance in a six-count, class action petition.  Appellants brought a declaratory judgment challenging the Ordinance’s constitutionality and conformity with state law, as well as Creve Coeur’s authority to enact the Ordinance.  Appellants also claimed the Ordinance violated procedural due process and the privilege against self-incrimination, and they alleged claims of unjust enrichment and civil conspiracy.  The City of Creve Coeur and American Traffic Solutions, Inc. (“Respondents”) filed a joint motion to dismiss, that was granted by the trial court, which was appealed to the Eastern District.

Because Appellants can challenge the ordinance in the municipal court proceeding, there is an adequate remedy at law; therefor, equitable relief is barred. However whether or not the ordinance was properly enacted in accordance with Creve Coeur’s police power for regulating public safety cannot be decided on a motion to dismiss because the Appellants allege that the Ordinance was enacted as a revenue-generating mechanism advanced under the guise of Creve Coeur’s police power, which is a fact question that is not appropriate for resolution on a motion to dismiss; therefore, this portion of the trial court’s judgment was remanded for further proceedings.  In addition, voluntary payment of the fine bars a recovery of the payment and related claims.  Judge Mooney, authored a vigorous dissent based on the grounds that the ordinance as applied violated the rules of the road since the ordinance is a legal fiction that converts a moving violation into a non-moving violation in order to avoid reporting the violation to the Department of Revenue.Ballard v. City of Creve Coeur For an earlier Post see my discussion of a case upholding the validity of the Creve Coeur ordinance as a non-moving violation.

Based on the above cases it seem like the eye of the needle has gotten smaller.  As to whether or not the photo red light ordinance was enacted to raise revenue it seems to me that the revenues from the enforcement should count as part of the entire traffic program of the city and that reporting the violation as a moving violation just ups the ante.

Also the General Assembly established in 2013 that 30% was the maximum of  the total city budget that could be raised by traffic enforcement (HB-103) strongly suggesting  that this is a legislative matter, and that the courts should refrain from entering the  fray as judicial activists.

Howard Wright @ 2013

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In a recent Federal District court opinion, Judge Nanette Laughrey issued a 62 page opinion that enjoins Linn State Technical College (College”) from implementing an unprecedented drug-testing program for nearly all students at the two-year college located in Linn, Missouri, a small mid-Missouri town. The opinion literally covers the waterfront with respect to drug testing of students for different types of student training programs/activities (and for that matter public employees who engage in similar activities). The opinion is a must read for anyone who is considering the adoption of a drug testing policy involving a government agency or for those who are concerned about suspicionless searches in violation of the Fourth Amendment.

Linn State College

Linn State College

The College offers a number of programs for about 1200 students with about five hundred new students entering each year. Programs were divided into four primary categories: each of which have further specialty areas some of which involve manual exercises that can be dangerous.  For example, students in the aviation maintenance program spend roughly 62% of their time doing hands-on training, where students work in close proximity to active propeller blades.  These students are also required to taxi airplanes.  Students seeking accreditation in the heavy equipment operations program spend between 51% and 72% of their time engaged in hands-on training.  This work involves operating Caterpillar D6R bulldozers and other heavy equipment weighing up to twenty-five tons.  An instructor in the industrial electricity department testified that students in his department spend about half their time engaged in hands-on functions.  This training involves dealing with live electricity and performing electrical services.  However for most students their training does not involve dangerous equipment or activities since they may be just sitting at a computer or a drafting table with a sharpened pencil.

Drug testing for work around airplanes OK

Drug testing for work around airplanes OK

Part of the mission of the College is to prepare students for the working environment.  When the College adopted the Policy it did not cite any particular problems with drug use by its students and in fact during the College’s 50-year history it could not identify drug use among its students as a significant problem nor could the College show that drug use caused or contributed to any accident in Linn State’s history. The College does not have any greater prevalence of drug use among its students than any other college.

So why did the College decide to adopt a Policy for drug testing of nearly all of its students?  In the fall of 2011 the College decided that it would start a drug-screening program for all students who are newly classified as degree or certificate seeking and students returning after one or more semesters of non-enrollment at the College.  The Policy states that the purpose of the program is to provide a safe, healthy, and productive environment for everyone who learns and works at the College by detecting, preventing and deterring drug use and abuse among students. Furthermore, drug screening has become an increasingly important part of the work environment. The President of the Board stated that the Policy would increase enrollment because parents would send their children to a school with a drug free environment.

While all of the above sounds good, the Policy lacked substance and appears to have been adopted on a whim without any real thought to how the College would justify or defend the Policy based on the current status of the law. For example, the Policy hypocritically failed to include faculty members who administered the programs covered by the Policy. While the reasons given for the adoption of the Policy sounded lofty and noble the Policy failed to mention one single element needed to justify the Policy under the case law – like safety of the students and others. Really no predicate was established for the Policy.

As public officials the College should have been asking deeper questions like whether or not the Policy can be defended, how it can be defended, the probability of success, what will it cost in attorney fees paid to the other side, and what will the College have to pay to defend the lawsuit? Remember in a civil rights lawsuit the government agency may not only have to pay its own attorney fees but also the other side costing hundreds of thousand of dollars. Ironically the College now has on its Home page a solicitation for donations to defend the policy.

As a condition of admission to the College, students were required to sign a form acknowledging the new drug-testing policy and that refusing to be screened would result in administrative or student-initiated withdrawal. In effect this was a mandatory, suspicionless drug-testing program constituting a search within the meaning of the Fourth Amendment, requiring the College to demonstrate a legitimate special need for drug testing that is sufficient to outweigh the students’ individual privacy expectations against the state.

The ACLU and a number of other groups hotly contested the drug-testing program from day one. Initially, in 2011 the Federal District court granted a preliminary injunction to the Plaintiffs who challenged the policy as overly broad, based on the likelihood of success, which was reversed by the 8th Circuit on the grounds that a challenge based on the facial invalidity of the Policy required that the Plaintiffs must show that “no set of circumstances exists” in which the drug-testing would be valid. As a consequence the Plaintiffs amended their petition challenging the Policy “as applied” to current students.

In order for the Policy to be valid the opinions by the District Court and the 8th Circuit stated that the safety risks must pose such a threat that “even a momentary lapse of attention can have disastrous consequences,” In addition, in order to override the ordinary requirements of the Fourth Amendment, the safety risks at issue must be of a unique or unusual degree. Finally, the safety risk must be to others, as opposed to the individual student performing the task.

No test required for many programs due to  lack of safety risk.

No test required for many programs due to lack of safety risk.

After the trial, the Court determined that an injunction was warranted with respect to those Plaintiffs whose Fourth Amendment rights were, or would be, violated by the application of Defendants’ drug-testing policy except for students enrolled in the Aviation Maintenance, Electrical Distribution Systems, Industrial Electricity, Power Sports, and CAT Dealer Service Technician programs. In addition, the College was ordered to return the fees collected by Defendants in connection with the unconstitutional application of Defendants’ drug-testing policy.

The programs offered by the College  are excellent and are clearly designed to meet a demand in Missouri and the United States for highly trained workers who have needed technical skills. The concern, I have expressed in this Post is not with the College or its excellent programs or the objective of eliminating drugs from the work force or the student population but instead the folly of not properly analyzing the limits of government power in establishing a policy that was unlawful resulting in a  waste of public resources defending the impossible.

Howard Wright @ 2013

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