May/June 2020 Issue

Also in this issue: Local Powers to Address COVID-19 in the Wake of Wisconsin Legislature v. Palm and OAG-03-20

Federal District Court Rejects First Amendment Challenge to City of Madison’s Billboard Ordinance Based on Reed

06.08.20

A federal district court in Wisconsin recently granted summary judgment against Adams Outdoor Advertising and rejected its arguments challenging the City of Madison’s sign ordinance as unconstitutional. In that ruling, the court held that the United States Supreme Court’s decision in Reed v. Town of Gilbert, 576 U.S. ___, 135 S. Ct. 2218 (2015) (“Reed”), does not upset longstanding commercial speech doctrine.

Billboard and outdoor advertising is a multi-billion dollar industry. Some municipalities limit or ban such signs in order to promote traffic safety and to preserve aesthetic values. These regulations sometimes raise First Amendment issues. In Adams Outdoor Advertising Ltd. Partnership v. City of Madison, No. 17-cv-576-jdp (W.D. Wis. Apr. 7, 2020)(“Adams”), Plaintiff Adams Outdoor Advertising sought to modernize its existing billboards and convert others to digital, but it could not do so under Madison’s sign ordinance.

Adams Outdoor Advertising brought multiple claims challenging Madison’s sign ordinance, but its core contention was that the city’s billboard rules were subject to strict scrutiny under Reed, which held that a regulation is content-based and therefore subject to strict scrutiny if it draws distinctions based on the message conveyed. Reed, 135 S. Ct. at 227. The court in Adams, however, held that Reed does not apply to Madison’s regulation of billboards, stating that ​“whether the Capitol Square should look like Times Square is a decision that Madison city government is entitled to make, even after Reed.”

For decades, it has been settled law that governments may impose restrictions on commercial speech if those restrictions satisfy ​“intermediate scrutiny,” that is, the regulation must directly advance a substantial government interest and must not be more extensive than necessary. See Central Hudson Gas & Electric Corporation v. Public Service Commission of New York, 447 U.S. 557, 566 (1980). It is equally settled that governments may distinguish between on-premises and off-premises signs, subject only to that intermediate-scrutiny standard. See Metromedia, Inc. v. City of San Diego, 453 U.S. 490, 507 (1981).

As the court in Adams observed, Reed ​“leaves intact the general framework for evaluating restrictions on commercial speech in Central Hudson … and for evaluating billboard regulations in Metromedia .…” (Slip Op. at 6.) The Reed decision did not discuss either Central Hudson or Metromedia, although Justice Alito in concurrence listed “[r]ules distinguishing between on-premises and off-premises signs” as one example of a rule that is not content-based under his understanding of the majority holding. Reed, 135 S.Ct. at 2233 (Alito, J., concurring).

According to the court in Adams, “[r]egardless of what Reed may portend for the Court’s future decisions, this court has no authority to disregard a Supreme Court decision that the Court itself has not overruled.” (Slip Op. at 25 (citing Agostini v. Felton, 521 U.S. 203, 237 (1997).) The district court held that the City’s billboard ordinances directly advanced interests of traffic safety and aesthetics in a manner that was reasonably fit to accomplish those objectives, and therefore it ruled that the regulations were constitutional under Central Hudson and Metromedia. (Slip Op. at 30 – 35.) The court rejected Adams Outdoor Advertising’s claims on other grounds too.

The decision in Adams provides municipalities with important clarity about First Amendment standards that apply to sign regulations and the limits of the Supreme Court’s decision in Reed. The ruling vindicates the rights of a municipality to promote its own unique aesthetic values and to protect traffic safety within its borders.

Boardman Clark partners Sarah Zylstra and Barry J. Blonien represent the City of Madison in the Adams litigation.