Giovani Carandola Ltd. v. Bason

303 F.3d 507, 2002 WL 1997902
Court of Appeals for the Fourth Circuit·Decided August 30, 2002·No. No. 01-1726·Published·Cited by 113 cases

Opinions

Affirmed in part and vacated in part by published opinion. Judge MOTZ wrote [510] the majority opinion, in which Judge TRAXLER joined. Judge NIEMEYER wrote a dissenting opinion.

OPINION

DIANA GRIBBON MOTZ, Circuit Judge.

In this case, the North Carolina Alcoholic Beverage Control Commission (the Commission) appeals from the district court’s order preliminarily enjoining it from enforcing certain state restrictions on nudity and other conduct, pending the outcome of a trial. For the reasons stated herein, we affirm in part and vacate in part.

I.

Giovani Carandola, Ltd. operates Christie’s Cabaret, a nude dancing establishment in Greensboro, North Carolina, which holds permits issued by the Commission to sell malt beverages, fortified wines, unfortified wine, and mixed beverages. In November 2000, an agent of the Commission visited Christie’s and observed three Car-andola employees engaging in various kinds of exotic dancing. The agent concluded that the dancers’ conduct violated N.C. Gen.Stat. § 18B~1005(a) (1995) and an administrative rule promulgated pursuant to that statute.

In pertinent part, § 18B-1005 provides:
(a)Certain Conduct. — It shall be unlawful for a permittee or his agent or employee to knowingly allow any of the following kinds of conduct to occur on his licensed premises:
(1) Any violation of this Chapter;
(2) Any fighting or other disorderly conduct that can be prevented without undue danger to the permittee, his employees or patrons;
(3) Any violation of the controlled substances, gambling, or prostitution statutes, or any other unlawful acts;
(4) Any conduct or entertainment by any person whose private parts are exposed or who is wearing transparent clothing that reveals the private parts;
(5) Any entertainment that includes or simulates sexual intercourse or any other sexual act; or
(6) Any other lewd or obscene entertainment or conduct, as defined by the rules of the Commission.

Pursuant to subsection (a)(6) of the statute, the Commission has adopted N.C. Admin. Code tit. 4, r. 2S.0216 (Apr.2002) (the Rule), which provides:

(a) No permittee or his employee shall allow any person to perform acts of or acts that simulate:
(1) sexual intercourse, masturbation, sodomy, bestiality, oral copulation, flagellation, or any sexual acts that are prohibited by law;
(2) the touching, caressing or fondling of the breasts, buttocks, anus, vulva or genitals;
(3) the display of the pubic hair, anus, vulva or genitals.
(b) No permittee or his employee shall allow any person to use artificial devices or inanimate objects to depict any of the prohibited activities described in Paragraph (a) of this rule.
(c) No permittee or his employee shall allow any person who exposes to public view any portion of his pubic hair, vulva, genitals, or anus to remain in or upon the licensed premises.

On December 6, 2000, the Commission sent Carandola a letter, stating, in part, that its employees had been observed (1) “simulating] sexual intercourse” and “simulating] masturbation” on the licensed premises in violation of § 18B-1005(a)(5) and Rule 2S.0216(a)(l); and (2) “engaging in acts of touching, caressing or fondling of [511] the breasts” in violation of Rule § 25.0216(a)(2). The Commission asked Carandola to stipulate to these violations and to accept as a penalty either a 30 day suspension of its permits or a 15-day suspension and a $3,000 fine.

Instead, Carandola, joined by Janel D. Ralph, a dancer at the club (hereinafter collectively, Carandola), filed suit in federal court. Carandola asked the district court to declare § 18B-1005 and Rule 2S.0216 unconstitutional, both facially and as applied, and, in the interim, to issue a preliminary injunction forbidding enforcement of these provisions against them. After an evidentiary hearing, the district court issued a preliminary injunction. Giovani Carandola, Ltd. v. Bason, 147 F.Supp.2d 383, 393-395 (M.D.N.C.2001). The Commission noted a timely appeal. We heard oral argument and then held this case in abeyance awaiting the Supreme Court’s decision in City of Los Angeles v. Alameda Books, Inc., — U.S. —, 122 S.Ct. 1728, 152 L.Ed.2d 670 (2002).

We review a district court’s grant or denial of a preliminary injunction for abuse of discretion. Doran v. Salem Inn, Inc., 422 U.S. 922, 932, 95 S.Ct. 2561, 45 L.Ed.2d 648 (1975). We accept the court’s findings of fact absent clear error, but review its legal conclusions de novo. North Carolina v. City of Virginia Beach, 951 F.2d 596, 601 (4th Cir.1992).

In deciding whether to issue a preliminary injunction, a court must consider “(1) the likelihood of irreparable harm to the plaintiff if the preliminary injunction is denied, (2) the likelihood of harm to the defendant if the requested relief is granted, (3) the likelihood that the plaintiff will succeed on the merits, and (4) the public interest.” Direx Israel, Ltd. v. Breakthrough Med. Corp., 952 F.2d 802, 812 (4th Cir.1992). In this case, as the district court recognized, the “irreparable harm” that Carandola alleged is “inseparably linked to [its] claim of violation of First Amendment rights[.]” Carandola, 147 F.Supp.2d at 387. Determination of irreparable harm thus requires analysis of Car-andola’s likelihood of success on the merits, and we turn to this question first.

II.

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Giovani Carandola Ltd. v. Bason, 303 F.3d 507, 2002 WL 1997902 (4th Cir. 2002).

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