Strip Club's Appeal Should be Decided by State Court

Strip Club's Appeal Should be Decided by State Court

  Wednesday, July 29, 2015    Julie Tappendorf

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Stars Caberet is a nude dancing establishment in Neenah, Wisconsin. When Stars opened in 2006, the County had a zoning ordinance that restricted the location of adult businesses to certain zoning districts and required a conditional use for their operation. In Stars' first lawsuit against the County, it challenged the constitutionality of the 2006 ordinance. During the pending lawsuit, the County amended the ordinance and Stars' dismissed its lawsuit. However, Stars brought a second lawsuit to challenge the 2007 amendment, and the court enjoined the County from enforcing the conditional use requirement, but upheld the remainder of the ordinance based on the ordinance's severability provision. 

Following the decision in the second lawsuit, the County informed Stars that it could not continue its operations because the business was never legal. Stars subsequently filed a third lawsuit asking the judge to declare its operation lawful under federal law or, in the alternative, a legal nonconforming use under state law. The district court ruled against Stars, finding that notwithstanding the ordinance's illegality, the business as unlawful when it opened in 2006. 

On appeal, the Seventh Circuit noted that the County's ordinance was an illegal prior restraint on expressive speech in violation of the First Amendment.  However, the Court noted that the ordinance included a severability provision, which could allow a court to sever the unlawful provisions of the ordinance from the remainder of the ordinance. Therefore, the Seventh Circuit held that the district court should have dismissed the state law claims because the application of the severance provision is a question of state law, especially where local land use matters are often resolved in state court, absent an overriding federal-law question. Accordingly, the Seventh Circuit dismissed the state law claims, so that the parties may (if they wish) pursue them in state court.  Green Valley Investments, LLC v. Winnebago County (7th Cir. July 27, 2015)

Post Authored by Julie Tappendorf & Dan Bolin, Ancel Glink