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City liable for sign firm's damages, judge rules

June 15, 2016

Local billboard company GEFT Outdoor LLC expects to seek millions of dollars in damages from the city of Indianapolis after a federal judge ruled that the city’s former sign ordinance was unconstitutional.

Judge Sarah Evans Barker ruled last month that GEFT is entitled to pursue monetary damages against the city over the ordinance even though sign laws have been amended since GEFT filed its suit last fall.

“We look forward to discussions with the city about those monetary damages, which are currently being quantified and [are] expected to be millions of dollars once all violations of our First Amendment rights have been properly evaluated,” GEFT officials said Tuesday in a statement to IBJ.

But the judge’s order also says that GEFT must abide by the amended sign ordinance, putting an end to the company’s quest to keep the city from enforcing either version of the ordinance.

GEFT filed its suit in U.S. District Court in Indianapolis last October, claiming that a recent U.S. Supreme Court decision made the city’s sign ordinance unconstitutional.

In its suit, GEFT asked that a judge bar the city from enforcing its ban on digital billboards. The suit also challenged some other aspects of the city’s sign ordinance, including its differing standards for “on premises” signs and “off premises signs” and "commercial" and "noncommercial" messages. In its suit, GEFT also sought monetary damages based on the revenue it said it was losing because of these restrictions.

The constitutionality question relates to Reed v. Town of Gilbert, a case on which the Supreme Court ruled last year. In that case, brought forth by an Arizona church and its pastor, the court ruled that the town’s sign ordinance violated the First Amendment because it limited the size of signs announcing church services.

GEFT's lawsuit alleged Indianapolis violated the First Amendment by having different standards for "on premises" and "off premises" signs. The on-premises signs, which advertise solely for the business in the same location as the sign, are allowed to have digital content. Off-premises signs, which advertise for a business or product located or made available elsewhere, are not allowed to have digital content.

On the same grounds, the suit objected to special regulations on signs that express noncommercial opinions or points of view, such as political, religious or ideological sentiment related to a public election.

"It's simply a content issue," A. Richard M. Blaiklock, an attorney representing GEFT, told IBJ last year. Because the Indianapolis ordinance imposed more restrictions on one type of content than another, it was unconstitutional, he said.

The city of Indianapolis amended its sign ordinance in November in order to bring it into compliance with the Supreme Court ruling. GEFT filed amended complaints after that.

GEFT’s lawsuit concerns three Indianapolis billboards that the company either owns or leases.

Two of the signs are near Interstate 70. At these locations, 4305 W. Morris St. and 5780 E. 25th St., GEFT had hoped to display digital content. GEFT filed for a zoning variance with the city, but that variance request was denied late last year.

The third sign in GEFT’s suit is at 700 W. Morris St. This sign is categorized as an on-premises sign. GEFT received a variance before erecting this sign in 1997, which was required because the sign was too large for its sign type and zoning district according to city ordinance.

GEFT had sought to use this sign to display off-premises signs and noncommercial messages. In her order, Barker noted that noncommercial messages are permitted under the amended sign ordinance.

In her May 20 order, Barker denied GEFT’s claims for declaratory and injunctive relief related to Indianapolis’ original sign ordinance. Those claims are now “moot based on the passage of the amended sign ordinance,” Barker said, but GEFT’s damages claims survive.

Barker also found that the city’s original sign ordinance violated the First Amendment, primarily because it imposed different restrictions on commercial and noncommercial speech. Thus, the city is “liable to GEFT for any resultant monetary damages it [GEFT] can establish.”

Barker also wrote that the amended ordinance is constitutional under the First Amendment, meaning that GEFT is bound to abide by these new requirements.

In its statement to IBJ, GEFT said:  “We are delighted with Judge Barker's decision that the city of Indianapolis' former sign ordinance was ruled unconstitutional in its entirety.  We are also delighted that, consistent with that ruling, the city is liable to us for whatever monetary damages GEFT is able to prove that resulted from the impact the ordinance had on GEFT. We are appealing the parts of the ruling that prevent GEFT from converting the signs to digital.”

The city’s chief litigation counsel, Donnie Morgan, declined to comment on the matter, saying that as a rule the office does not make public statements about ongoing litigation.
 

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