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CR 05-054 Advantage Media vs City of Hopkins C\IY OF - HOPKINS April 14, 2005 Council Report 05-54 ADVANTAGE MEDIA AND HISPANIC CHAMBER OF COMMERCE VS CITY OF HOPKINS Proposed Action, Staff recommends the following motion: Move to reiect the settlement agreement from Advantage Media and Hisoanic Chamber of Commerce. Overview. On or about November 23, 2004, the City received four sign permit applications for billboards that were proposed in locations that billboards are not allowed and that also exceeded the maximum square footage allowed, The billboards were approximately 600-700 square feet and located in business districts. The individual who attempted to obtain the sign permits was told the sign permits did not meet the ordinance requirements and was given the applicant back; however he left the applications on the counter at City Hall. The sign permits were mailed back on or about December 3, 2004, The City received a lawsuit on December 13, 2004, regarding the refusal to grant the sign permits. The League of Minnesota Cities assigned the law firm ofIverson Reuvers to represent the City. On March 9, 2005, our attorneys received a settlement offer from Advantage Media. Eden Prairie has also been sued by the same individuals for refusing to grant sign permits. Primary Issues to Consider, . Where are billboards allowed? . What are the main points ofthe settlement agreement? Supportinl! Documents. . Analysis ofIssues . Proposed settlement agreement . Article from Atlanta Journal Constitution ~~An=P Planner Financial Impact: $_N/ A_Budgeted: Related Documents (ClP, ERP, etc,): Notes: Y IN Source: CR05-54 Page 2 Primary Issues to Consider, · Where are billboards allowed? Billboards are allowed in the Industrial zoning districts with conditions, and the maximum size is 250 square feet. The existing billboards on Highway 169 are 250 square feet. · What are the main points of the settlement agreement? The two main points of the settlement agreement are that they want the City to redraft its sign ordinance with their help and allow Advantage Media to erect two billboards. The billboards they proposed to construct are electronic and approximately 600-700 square feet. The locations they are proposing to erect the billboards are at 509 Second Avenue South, the former Data Serv building abutting the Park Valley neighborhood, and 919 Cambridge, the site of Lindee's, Alternatives, 1. Approve the settlement. By approving the settlement agreement, two billboards will be constructed and the sign ordinance will be rewritten, 2. Deny the settlement agreement. ... .:, WEBB & PORTER, L.L.C. 2625 CUMBERLAND PARKWAY, S,E, . SUITE 220 . A'ILANTA, GEORGIA 30339 (770) 444-9325. (770) 444-0271 (facsimile) Author's Direct Dial: (770) 444-0773 March 9, 2005 Email Address: webbllc@bellsouth,net VIA FACSIMILE TO (952) 946-1501 AND U.S. MAIL Paul Reuvers, Esq. Jason Kuboushek, Esq, Iverson Reuvers, Attorneys at Law 9321 Ensign Avenue South Bloomington, MN 55438 PRIVILEGED AND CONFIDENTlAL SETTLEMENT COMMUNICATION Re: Advantal!e Media and Hispanic Chamber of Commerce v. City of Hopkins (Case No, O:04-cv-04959-MJD-JGL, D. Minn,) Dear Messrs, Reuvers and Kuboushek: Pursuant to my conversation with Jason last week and the Rule 26 requirements I have discussed with my clients a potential accommodation in this matter. My clients have arrived at what seems to be a very attractive proposal, As you will see, they are willing to accept a lesser number of sign locations all of which will be in unquestionably commercial areas, My clients will make the following concessions in exchange for the accommodations outlined below: · My clients will waive all claims for damages, including those due pursuant to 42 U,S.C, ~ 1983, Such damages are accruing at a substantial rate; . My clients will waive their claims for attorneys' fees and expenses pursuant to 42 U,S,C, 9 1988, Such fees will escalate rapidly as we begin our briefing; . My clients will agree to withdraw with prejudice all of the sign applications not described below (at least two of the four sign locations applied for); . My clients will agree not to challenge the City's sign regulations again provided the City agrees to work in good faith to adopt constitutional sign regulations as outlined below; · My clients will agree not to advertise strip clubs or other adult entertainment establishments on the signs to be posted pursuant to any agreement with the City, Although a government entity could not adopt such a restriction, my clients are prepared to do so as a contractual matter in the settlement; · My clients will also agree not to advertise any type of tobacco products on the signs to be posted pursuant to any agreem ent with the City; Paul Reuvers, Esq, Jason Kuboushek, Esq, March 9,2005 Page 2 . My clients will agree to compensate this firm, to the extent the City so desires, to assist the City in redrafting its sign regulations to reduce the likelihood of further constitutional challenges to the regulations, We have drafted several sign ordinances in the past; and . My clients will agree to pay the City $1000 per sign for handling all permitting and inspections, In return, the City must: . Agree to act in good faith to draft, consider, and adopt fully constitutional sign regulations within six months, Although obviously my clients will have no direct role in this process, the City must agree to consider their comments and suggestions in arriving at the final text; and . Allow Advantage Media to post standard-sized; double-sided outdoor advertising signs at two of the four applied-for locations, to include: (1) 509 2nd Avenue (sign would face Highway 169); and (2) 919 Cambridge Street (sign would face Highway 7), If the City would prefer, the Cambridge Street location can be substituted with a location on the City's property along Highway 169 (Hennepin parcel ID # 25 117 22 44 0003), The City as landowner would be paid 20 percent of gross collected income, or approximately $30,000 per year, This proposal will allow the City great flexibility to ensure that signs do not impact its sensitive areas, I hope this framework is acceptable to the City, We have attempted to alleviate the City's concerns regarding sensitive areas, These signs will assist local businesses without intruding upon any residential zones, The alternative for the City and its insurer will entail great costs and no control over the sign locations. If you or other representatives of the City would like to discuss this matter please do not hesitate to call me at (770) 444-0773, t"~ l~vlr- E, Adam Webb EAW/dc ."1. AtlantaJoumal Constitution July 28, 2003 Page I Lawyer fights for billboards'We're the red-headed stepchild of the First Amendment'Matt Kempner - StaffMonday, July 28, 2003 There may be a niche for everybody. For Edward Adam Webb, it is 60 feet up, plastered on the sky, hawking new cars, Bud Light or a good personal injury lawyer. "I do love billboards," Webb says, The 32-year-old Atlanta attorney has more than 100 new billboards to his credit, by his own estimate. And he's gunning for more. The secret to his success: a legal strategy that, if not unique, has won him critics, confrontation and a cadre of billboards across Georgia and beyond, Billboard companies hire him when they want to erect billboards in communities that don't want them. Webb's speciality is scouring local sign ordinances looking for restrictions he believes are unconstitutional, even if they have nothing to do with billboards. Treat a garage sale sign differently than a bake sale sign? He's all over that. Enact a law that fails to state purposes for limiting signs? Bam! Give out the billboard permits or he'll take you to court, revving up the First Amendment like a dentist's drill --- and digging out space for more signs. So far he's sued 25 cities and counties in Georgia, and has cases pending in Cobb County, Atlanta and Fulton County. With area officials getting wise to him and fixing their laws to withstand legal challenges, Webb's gone interstate, filing suits in Alabama, Florida, Tennessee, California and Connecticut. "I don't know how many people have caught on to the same thing he's doing, but certainly he is the leader in the field," says Randal Morrison, a California lawyer who is defending a city against a Webb lawsuit. Webb's crusade is a modern front in the long standoff between outdoor advertisers and city councils, garden clubs and government attorneys. Critics accuse him of wielding legal technicalities to spread visual blight. It's a "sign code shakedown," says Morrison. Not at all, Webb says. What he's really doing is defending free speech against the whims of government officials who don't like signs. A 672-square-foot pitch for high-risk auto insurance may not be a poster child for the First Amendment, but it's still constitutionally protected in Webb's world, "We're the red-headed stepchild of the First Amendment," he says of the billboard industry. Elephantine signs have become a fixation for him. -1- Driving to a courthouse in Birmingham, Billboards. Going to the Gulf to relax on the beach. Billboards, billboards, billboards, "There's never a boring trip for me now," Webb says. "I appreciate them in all their forms wherever they are," A billboard in Doraville hawks concrete mix on one side: "Add water. Not time," On the other is an ad for a car dealer. It makes Webb smile. "It's fantastic," he says, "It's a good example of: Why not? This landowner here wants a new revenue stream. People on 285 and Peachtree Industrial Boulevard are fully expecting to see outdoor advertising, , , And yet the city of Doraville had a complete ban on such signs." Early billboard case A native of Columbus, and son of a retired college mathematics professor, Webb went to Harvard as an undergrad and finished the University of Georgia's law school in 1996. He landed a job at Dow, Lohnes & Albertson --- a high-powered law firm that counts The Atlanta Journal-Constitution among its clients. Webb did work for the newspaper, but after less than a year at the firm, a seemingly not-so- sexy billboard case got "dumped" on him, he says. ''We just really meshed, me and the work and the clients," Webb says, He started out relying on some of the same legal strategies used by David H. Flint, another Atlanta attorney who has fought for billboards, He launched his own law firm last year, churning out motions and complaints that almost always have to do with billboards, Attorney Bill Porter, whom Webb met when Porter represented the city of Suwanee against a Webb lawsuit, joined the firm. earlier this year. Porter works out of his own home. Webb works out of a Dunwoody house he has been trying to sell ever since he and his wife moved to Buckhead months ago. Boxes of case files are stacked on the floor of his former breakfast room. On the mantel of a room he uses as his office is a map of a national wildlife refuge in Arizona, where he and a buddy took a hiking trip, "There's no market for signs out there," he says, grinning, If he could get his wife's blessing, he says, he would move the family to the North Georgia mountains where his 1-year-old son could grow up near the woods, as he did, Instead, he lives near Mount Paran Road in Buckhead. "My house now is on a beautiful tree-lined street," he says. He points out there is a billboard down the street, hidden behind trees, near 1-75. "People talk about blight, but this is one of Atlanta's finest neighborhoods. Tree- lined streets. The property values are fantastic and constantly going through the roof," he says, "Most people I talk to really value outdoor advertising." ''They are tacky. They are ugly. They are a blight on the landscape," says Roswell Mayor Jere Wood. Roswell, and its attempts to ban most billboards, seemed to be a special challenge for Webb. He sued and won, forcing the city to allow seven new billboards. Another tactic The mayor tried another tactic to keep signs at bay. He wrote to companies leasing the billboard space, asking them to stop and noting that some of them also -2- did business with the city. Webb took Wood to court on behalf of the owner of the billboards, now Clear Channel Outdoor. The Georgia Supreme Court upheld a lower court judge who ordered the mayor to stop trying to interfere with Ciear Channel's billboard business. Earlier this year, Webb sued the city again, contending there are still flaws in the iocal sign ordinance, The case is pending. Covington also has a history with Webb. He sued the city this year, making his usual arguments against "draconian restrictions" of signs. Covington lawyers asked a judge to throw Webb off the case. The reason? Webb helped write the city's ordinance (as part of a tradeoff in a previous billboard fight), Webb says he's sure he made good legal suggestions to Covington, but more recent court rulings make the law unconstitutional now. "I thought it was terrible and still do," City Manager Frank Turner says of Webb's actions. "It makes you sick," Agreeing to settle The sides recently agreed to settle with the result that the city would allow more billboards. Turner offers a suggestion for Webb: Drop your allegiance to billboard companies and become a consultant for local governments. "Be constructive instead of destructive. " A city may have no billboards. It may have dozens of billboards. Either way, there's a decent chance Webb wants it to have to more. In Southern California, Webb sued the City of Industry, which banned new billboards when it had nearly one for every seven residents, After Webb sued, the city revamped its law and agreed to pay some of Webb's legal fees, but no new billboards were allowed, In Florida, Webb sued Mary Esther, a city that says it has never had billboards. The Gulf Coast bedroom community, nestled beside Ft. Walton Beach and an Air Force base, was founded in the 1940s in part to ban billboards. Webb's client, Florida-based Seay Outdoor Advertising, wants to install seven billboards, each with two sides, each side twice as big as typical interstate billboards. One is proposed on commercial property near a nature park for the city's 4,200 residents. "We don't want someone coming in here acting on behalf of third parties telling us we have to have billboards," City Manager John Lulue says. Some of the proposed billboards would be on a main beach highway that, despite the presence of a Target and Hampton Inn, is bounded by many homes and live oak trees, Bernice Edgecombe, who works at a local bridal shop, might be expected to be sympathetic to Webb and his billboard cases, She likes some billboards in other cities and she's had a run-in with what she calls Mary Esther's "sign police" over a temporary banner for the shop. But there's such a thing as too much, Edgecombe says. Super-sized billboards in the little town "would overwhelm everything else," she says. Webb's strategy -3- Here's Webb's strategy: A sign company applies for multiple billboards in a community that prohibits them. The community denies the permits, usually quickly. Webb sues, claiming violations of the First Amendment. He attacks a sign ordinance at what he thinks are its weakest points, While he will cite what he considers overly broad bans on new billboards, he often relies heavily on issues that have little to do with his clients' billboards. Webb points out that in Fulton County, real estate signs can stay up longer than signs announcing political events. And construction signs and political signs can be 16 times bigger than garage sale signs. But, Webb says, there should be no distinctions based on content --- even billboard ads or so-called "off-premises" signs --- unless a government can satisfy the courts that "the distinction will directly advance a legitimate governmental interest in a material way. . , and would do so in the most narrowly tailored fashion." In Mary Esther, Webb argued that one flaw in the city's ordinance was that it set no time limit for acting on permit applications, though a city official denied his client's application in minutes. "These are like hyper-technical details in the code as opposed to intentionally depriving people of speech opportunities," says Don Davis, an attorney representing the City of Industry. So, Webb sues, with the goal of getting a judge to invalidate an entire sign ordinance. Then his sign-company client demands that the city issue billboard permits, saying the ordinance in place when permits were originally denied was invalid. Sometimes, Webb's client doesn't even put up the billboards, but sells the permits to other companies. The payoff can be big. Just one permit in the right metro Atlanta location can be worth hundreds of thousands of dollars, according to court testimony, And once they are up, double-faced signs along 1-285 can generate $8,000 a month in advertising rent. Tactics sometimes fail Webb's legal tactics don't always work. He is appealing a federal judge's decision in Clearwater, Fla., and he was turned down on an appeal of another federal judge's ruling in Stamford, Conn, But he's also won cases or negotiated with cities that would rather settle and accept a few billboards than risk losing in court and being forced to accept many more, "The technique that billboard companies use often turns on the idea that many of these city councils cannot afford the time or risk the distraction and the potential for civil rights damages. So they settle," says Morrison, the California lawyer, Webb's methods can be slow. He sometimes wins approvals for handfuls of billboards in a county or city after months or years of legal work, Many of his clients are small players in the industry, though Webb represented industry giant Lamar Advertising in the Covington case, and No.2 ranked Clear Channel Outdoor has bought several sign permits Webb's clients won in other cities. Tactics such as Webb's are "an aberration" in the industry, says Eric Rubin, the general counsel for the billboard industry's main trade group, the Outdoor Advertising Association of America. -4- "It is not the way billboard companies as an industry operate," Rubin says. "Most are abie to build billboards within the context of ordinances that already exist." But Wayne Charles, a Fayetteville businessman who is one of Webb's most active clients, says Webb's strategy strikes a blow for free speech. People without the money or time to challenge ordinances will benefit from elimination of laws that unfairly limit their rights, Charles says. What about laws that allow only one political sign in front yards? What if your spouse supports another candidate? And what about laws that institute economic favoritism, such as allowing billboards only if they advertise a major attraction? "That's a problem that doesn't get fixed without us," Charles says. Nonetheless, he acknowledges, his reason for hiring Webb is to get billboard permits, Even Webb's opponents concede the he gets some things right. Government officials have acknowledged constitutional blunders in their sign laws and rewritten them, even while Webb's lawsuits are pending, However, the officials often leave in limits on billboards, which means Webb doesn't let up unless they give his clients permits. Field wide open Webb's field of opportunity is wide open, says Bill Brinton, an attorney defending three Florida cities against billboard companies represented by Webb. It includes "every city, county, township, borough, parish, His plate will always be full." Governments could undercut Webb if they just fixed their ordinances, says Charles, Webb's client. "I anticipate that within three years I'll be out of [the billboard permitting] business because the laws will be so tight," Charles says. But Webb says governments aren't trying very hard, refusing to update their ordinances even after neighboring communities are sued. "When cities start drafting all their little pet peeves and trying to micromanage signs is where they get in trouble," he says. "It is very easy to draft a constitutional sign ordinance." His advice: Avoid making distinctions based on content of signs, Limit the size of signs by the amount of road frontage a commercial property has. Allow an unlimited number of signs on residential property so long as the combined size of the signs doesn't exceed a limit. Put a section in the ordinance explaining the purpose for the limits and prepare a report backing up that reasoning. Critics point out that under Webb's scenario, a sign announcing a public safety issue would be allowed no greater size than one announcing a house for sale. Webb shrugs off criticism. He's digging the billboard business, So much so, in fact, he's trying to get billboards of his own. Using the name Horizon Outdoor, Webb and colleagues have sued three cities in California for permits. "I wish I had quit being a lawyer six or seven years ago and done what my clients are doing, because a lot of them have done very well," Webb says. "Being a lawyer is no way to get rich, All you have is your billable time. . . But I do love what I do," -5-