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832 Corp., Inc. v. Gloucester Township

December 12, 2005

832 CORPORATION, INC., 225 CORPORATION, INC., AND THE JOHN ADAMS CLUB, INC., HONORABLE JOSEPH E. IRENAS PLAINTIFFS,
v.
GLOUCESTER TOWNSHIP, DEFENDANT.



The opinion of the court was delivered by: Irenas, Senior District Judge

OPINION

Plaintiffs 832 Corporation, Inc., 225 Corporation, Inc., and the John Adams Club, Inc. ("Plaintiffs"), brought the instant action challenging the constitutionality of Gloucester Township ("Township") Ordinance O-99-04 ("Ordinance"), which regulates adult businesses. Presently before the Court are the cross-motions of Plaintiffs and the Township for summary judgment.

I.

A. Gloucester Township Ordinance O-99-04

The Township adopted the Ordinance on February 22, 1999. The Ordinance created a comprehensive licensing scheme to regulate "adult-use establishments" within the Township's borders. The Township specified that its purpose in enacting the regulations was to address the "adverse secondary effect" such businesses have on the community. (§ 24.1.) The Ordinance enumerates various secondary effects including "depreciation of property values, deterioration of neighborhoods, increase in incidences of crime, increase in blight, increases in vacancy rates of residential and commercial areas and increases in litter, noice and the interference with property owner's enjoyment of their property located in the vicinity of Adult Use Establishments." (Id.)

The Ordinance requires all adult use establishments to obtain operating licenses issued by the Township, pay a license fee and abide by certain restrictions on the location of the business, operating hours, advertising and signage, interior lighting and construction, and inspection of the premises. Adult use establishments are defined as adult book, novelty or video stores, adult arcades, adult entertainment cabarets, adult motels, adult motion picture theaters, and adult theaters. (§ 24.2.) Given the extent and length of the Ordinance, the Court will not replicate it here but will quote from the Ordinance where relevant in discussing the parties' claims.

Of particular relevance here is the Ordinance's definition of an adult entertainment cabaret, which the Township maintains is applicable to Plaintiffs' business. When the Ordinance was adopted, such a business was defined as:

A nightclub, bar, restaurant or similar commercial establishment which features:

1. Persons who appear in a state of nudity

2. Live performances which are characterized by exposure of specified anatomical areas*fn1 or specified sexual activity*fn2

3. Films, motion pictures, video cassettes, slides or other photographic reproductions which are characterized by the depiction or description of specified sexual activities or specified anatomical areas. (§ 24.2.) On April 23, 2001, in the midst of the events related to the instant matter, the Township amended this definition to specify that it includes any such establishment which "features or permits" the listed activities. Gloucester Township Ordinance 0-01-11. The amendment also added a fourth category to the list, encompassing "[a]ctivities by persons which are characterized by exposure of specified anatomical areas or specified sexual activities." Id.

The Ordinance also includes sections regarding the definitions of the relevant terms, licenses required and duties of applicants, issuance of licenses, license fee, location of adult use establishments, development standards and use regulations for such businesses, inspections of adult use establishments, the suspension, revocation and transfer of licenses, and enforcement of the ordinance. A June 9, 2003, amendment to the Ordinance added a provision to the section on the licenses required and duties of the applicant.

B. Plaintiffs' License Application and Business

On September 5, 2000, Plaintiff 225 Corporation filed an application for a Mercantile License*fn3 with the Township to operate an establishment at 834 Black Horse Pike in a building that had previously housed the nightclub Club Fiji. (Def. Br. Ex. D.) The application lists the name of the business as "225 Corporation, Inc. d/b/a The New Club Fiji" and describes the type of business as "restaurant (catered) NIGHTCLUB." (Id.)(Emphasis in original.) Alvin Pearis is listed as the sole owner of 225 Corporation. (Id.) Plaintiff 832 Corporation, Inc., is listed as the owner of 834 Black Horse Pike. (Id.) Plaintiff John Adams Club, Inc., is not listed on the application.

Assistant Municipal Township Clerk Ann Quintavalle sent a letter to Pearis on September 18, 2000, asking for a "more definitive answer from you as to the type of establishment you will be operating." (Def. Br. Ex. F.) At some point in September, 2000, Quintavalle also provided a copy of the Ordinance to Nancy Hart-Esposito, Esq., counsel to 225 Corporation. (Quintavalle Cert. ¶ 4, Def. Br. Ex. E.) Quintavalle stated in an affidavit that she provided Hart-Esposito with the Ordinance because "[Hart-Esposito] was unable to descirbe the type of establishment that would be installed at the Club Fiji." (Id.) Quintavalle also stated that Hart-Esposito had "implied" that the New Club Fiji "may be used for adult purposes." (Id.)

In an October 9, 2000, letter to Quintavalle, Pearis wrote that "[i]t is my intent to have a food and beverage facility that is open to the general public." (Def. Br. Ex. G.) Pearis further stated that food would be prepared off-site and brought to the New Club Fiji for retail sale, but he had not yet determined whether he would secure a liquor license for the business. (Id.)

Pearis and various Township officials exchanged several letters, and a meeting was held between Hart-Esposito, the Township Solicitor and other Township officials on November 22, 2000. (Def. Br. Ex. H.) This correspondence culminated in a December 19, 2000, letter from Pearis to Bernie Shepherd, a Township official, in which he "amend[ed] and clarif[ied]" the description of his business in the original license application:

1. It is my intent to have a non-alcoholic nightclub that serves food and beverages prepared off premises. I have not ruled out the possibility of obtaining a liquor license and food license in the future.

2. There will be either a disc jockey or live music with a designated dance floor, the same as Club Fiji used.

3. The tables and chairs will be set around the dance floor and existing bar area, but will not be in a fixed location and will be movable by patrons and staff the same as they were for Club Fiji.

4. I will use the existing lighting in place that was used by the previous nightclubs, Club Fiji and Omar's, at the location.*fn4 (Id.) Pearis further stated that "[t]his facility will be operated the same as a nightclub that does serve alcoholic beverages." (Id.) He also stated that he would rent the facility to individuals for "weddings, birthday parties, dances, fundraisers, holiday celebrations and the like." (Id.)

On February 23, 2001, the Township issued a Mercantile License to 225 Corporation, operating under the trade name "The New Club Fiji," for a "non alcoholic nightclub-food & beverages prepared & supplied off premises." (Def. Br. Ex. I.) Shortly thereafter, the Township Police Department received information that the New Club Fiji was operating as an adult use establishment, and began an investigation in April, 2001. (Def. Br. at 6, Smith Cert., Def. Br. Ex. K.) The Police Department discovered an advertisement on the website "Swingersusa" for parties at Plaintiffs' establishment. (Def. Br. at 7, Def. Br. Ex. J.)

On April 7, 2001, Tracey Holmes, a Township police officer, and two investigators from the Camden County Prosecutor's Office ("CCPO") attempted to gain admittance to Plaintiffs' establishment but were denied access because they were not on the guest list. (Holmes Cert., Def. Br. Ex. L.) Holmes, Fawn Landay and Robert Ferris, CCPO investigators, were admitted to the club on April 14, 2001, as they had placed their names on the guest list by sending an email to the website.*fn5 (Id.) They did not pay an entrance fee. (Landay Cert., Def. Br. Ex. M.)

During the April 14, 2001, visit, Holmes, Landay and Ferris toured the club. (Holmes Cert., Landay Cert.) The woman giving the tour referenced certain rooms where guests could have sex, and showed them rooms with mattresses on the floor. (Id.) They also observed a woman exposing her breasts, a couple fondling each other's genitalia and several patrons engaging in sexual intercourse. (Id.)

On April 21, 2001, Holmes, Landay and Ferris again visited the club and were not asked to pay a cover charge.*fn6 (Id.) They observed that more mattresses had been brought in to the facility. (Id.) They observed women exposing their breasts, men fondling and making oral contact with women's breasts, women performing oral sex acts on male patrons, and couples and groups of people engaging in sexual intercourse, oral sex and masturbation. (Id.) They also saw several individuals watching other patrons engage in sexual acts. (Id.) On this night, other patrons propositioned Holmes and Landay for sexual acts. (Holmes Cert., Landay Cert.) They acquired two issues of "Swingers Direct" magazine, as well as several flyers, which were displayed for the patrons to take without charge. (Smith Cert.)

Holmes and Jason Gittens, a Township police officer, visited the club on May 5 and May 12, 2001, and observed similar activities. (Holmes Cert., Gittens Cert., Def. Br. Ex. O.) On May 5, 2001, Holmes and Gittens were required to fill out applications for membership in the John Adams Club and give their driver's licenses to the club attendant for copying. (Id.) They also paid a sixty dollar entrance fee. (Id.) Gittens estimated that there were approximately one hundred to one hundred and fifty patrons at the club by the end of the evening of May 5, 2001. (Id.)

On May 12, 2001, Holmes and Gittens were asked whether they had previously visited the club and their names were checked against a printed registry. (Id.) They again paid a sixty dollar entrance fee. (Id.) They observed patrons engaging in a variety of sexual activities. (Id.) Holmes and Gittens discovered that the manager of the club, a man later identified as Joseph Patrlja, was present. (Id.) On this night, Holmes and Gittens identified themselves as police officers, and other officers then entered the club. (Id.) They took photographs of several of the guests engaging in sexual acts, and ordered the patrons to get dressed and vacate the premises. (Id.)

Individuals affiliated with Plaintiffs' establishment were charged with violating the Ordinance, but those charges were dismissed by the Superior Court, Camden County.*fn7 Plaintiffs' voluntarily ceased operating their business after the May 12, 2001, police raid. Plaintiffs filed a Complaint against the Township of Gloucester on March 10, 2004, alleging that the Ordinance violated their substantive due process, First, Fourth and Fourteenth Amendment rights on its face and as applied to them.*fn8 They seek a declaratory, injunctive and monetary relief. The parties have filed cross-motions for summary judgment on the case in its entirety.

II.

Under Fed. R. Civ. P. 56(c) a court may grant summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). The non-moving party may not simply rest on its pleadings to oppose a summary judgment motion but must affirmatively come forward with admissible evidence establishing a genuine issue of fact. Id.

In deciding a motion for summary judgment, the court must construe the facts and inferences in a light most favorable to the non-moving party. Pollock v. Am. Tel. & Tel. Long Lines, 794 F.2d 860, 864 (3d Cir. 1986). The role of the court is not to "weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986).

III.

Plaintiffs' Complaint and the summary judgment motions raise several issues that have not been squarely addressed by the Supreme Court or the Third Circuit. The parties have asked this Court to determine whether the privacy right articulated by the Supreme Court in Lawrence v. Texas encompasses the activities occurring in Plaintiffs' establishment. Plaintiffs' Complaint also travels into some of the more uncharted areas of the Supreme Court's First Amendment standing jurisprudence. Moreover, these thorny issues are presented to the Court in the form of a facial challenge, and thus we are deprived of a concrete factual setting in which to test the constitutionality of the Ordinance.

Before the Court addresses the main substance of the parties' arguments, we will address two preliminary issues. First, Plaintiffs maintain that the Ordinance, as originally adopted and in effect when they applied for a Mercantile License, did not require them to obtain an Adult Use Establishment License. They argue that the definition of adult entertainment cabaret did not encompass their business because they merely permitted sexual activity on the premises and did not "affirmatively offer sexual entertainment as a part of its standard operation."*fn9 (Pl. Reply Br. at 8.) Given the fact that Plaintiffs' establishment devoted a significant amount of space, including mattresses and specially partitioned rooms, to areas where patrons could engage in sexual activity, it can hardly be argued that the business did not feature such activities. It thus falls within the ambit of the Ordinance both as originally adopted and as amended.

It is important to emphasize that the Ordinance does not impose a total ban on adult use establishments within the Township. The Supreme Court's decision in Schad v. Borough of Mt. Ephraim, 452 U.S. 61 (1981), clearly indicates that the First Amendment would bar such an ordinance. However, "[t]he mere fact that the commercial exploitation of material protected by the First Amendment is subject to zoning and other licensing requirements is not a sufficient reason for invalidating these ordinances." Young v. Am. Mini Theatres, Inc., 427 U.S. 50, 62 (1976). After careful consideration of the applicable law and for the reasons set forth below, the Court concludes that the Township is entitled to judgment as a matter of law, and correspondingly, Plaintiffs' motion for summary judgment must be denied.

A. Substantive Due Process

In Lawrence v. Texas, 539 U.S. 558 (2003), the Supreme Court held that the right to privacy encompasses decisions regarding private, consensual sexual conduct. The Court stated that "[l]iberty presumes an autonomy of self that includes freedom of thought, belief, expression, and certain intimate conduct." Lawrence, 539 U.S. at 562. Overturning the decision in Bowers v. Hardwick, 478 U.S. 186 (1986), Lawrence concluded that Texas' law criminalizing sexual intimacy by same-sex couples violated the Due Process Clause of the Fourteenth Amendment.

Plaintiffs maintain that the Lawrence decision reflects the fact that "[t]he liberties guaranteed by substantive due process have moved out of the marital bedroom and into the public sphere of commercial interactions and private interactions between consenting adults." (Pl. Br. at 4.) (Emphasis added.) They interpret Lawrence as "suggesting that practically all choices made by consenting adults regarding their own sexual practices were a matter of personal liberty and thus beyond the reach of state control." (Pl. Br. at 7.) Plaintiffs contend that the sexual activities of their patrons are included within Lawrence's scope because their business is a private establishment. (Pl. Br. at 9.) Therefore, they argue that the Ordinance intrudes upon the privacy of their patrons by requiring a license for the New Club Fiji to operate. (Pl. Br. at 9.)

This Court does not accept Plaintiffs' interpretation of Lawrence. The Supreme Court placed special emphasis on the private nature of the conduct and setting at issue in Lawrence. Justice Kennedy, writing for the majority, stated that the "beginning point" for the analysis of the substantive reach of liberty under the Due Process Clause was the Court's decision in Griswold v. Connecticut, 381 U.S. 479 (1965). Griswold "described the protected interest as a right to privacy and placed emphasis on the marriage relation ...


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