Six Star Holdings, LLC v. City of Milwaukee

932 F. Supp. 2d 941, 2013 WL 1130437, 2013 U.S. Dist. LEXIS 37026
CourtDistrict Court, E.D. Wisconsin
DecidedMarch 18, 2013
DocketCase No. 10-C-0893
StatusPublished
Cited by1 cases

This text of 932 F. Supp. 2d 941 (Six Star Holdings, LLC v. City of Milwaukee) is published on Counsel Stack Legal Research, covering District Court, E.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Six Star Holdings, LLC v. City of Milwaukee, 932 F. Supp. 2d 941, 2013 WL 1130437, 2013 U.S. Dist. LEXIS 37026 (E.D. Wis. 2013).

Opinion

DECISION AND ORDER

LYNN ADELMAN, District Judge.

Since 2009, plaintiffs Six Star Holdings, LLC and Ferol, LLC have sought to open night clubs featuring erotic dance entertainment in the downtown area of the City of Milwaukee. In order to both serve liquor and present erotic dancing, [944]*944the plaintiffs had to obtain two licenses under the Milwaukee Code of Ordinances: a tavern license and a “tavern amusement” license. In August 2010, each plaintiff appliéd for both'licenses, and the City denied their applications. A year later, in September 2011, plaintiff Six Star decided to open a night club that featured erotic dance entertainment but did not serve alcohol. Six Star thought that to open such a “dry” gentlemen’s club, it needed to be licensed to operate a theater. It therefore applied for a theater license. However, the City never acted on that application. Instead, a few months after Six Star applied for a theater license, the City repealed the chapter of the Code of Ordinances that provided for issuance of theater licenses. At the same time, the City also repealed the ordinance governing tavern-amusement .licenses as well as a related ordinance governing “public entertainment clubs.” The City replaced these ordinances with new ordinances governing “public entertainment premises.”

In the present lawsuit, which arises under 42 U.S.C. § 1983, the plaintiffs allege that the former ordinances governing tavern amusement, theaters, and public entertainment clubs violated the First Amendment. They also allege that the tavern, tavern-amusement, and theater ordinances were unconstitutionally applied to them. The plaintiffs do not seek any injunctive or other form of prospective relief, and they do not bring any claims involving the newly enacted ordinance governing public entertainment premises. Instead, they seek only damages for the time period in which the repealed ordinances (and the tavern ordinance, which is still in force) prevented them from offering erotic dance entertainment in the City. Before me now are the parties’ motions for summary judgment.

I. BACKGROUND

The plaintiffs are managed by John Ferraro, who is the manager of three existing erotic dance establishments in Wisconsin, each named Silk Exotic Gentlemen’s Club. One of these establishments is located in the City of Milwaukee, although not in the downtown area. In 2009, Ferraro formed Ferol and leased premises located on Pittsburgh Avenue in downtown Milwaukee, intending to open a new erotic dance establishment, named Satin. Because Satin would have offered both liquor and erotic entertainment, Ferol needed to obtain both a tavern license and a tavern-amusement license. Ferol applied for both licenses in July 2009. Once the applications were filed, the alderman for the district in which Satin was to be located informed his constituents of Ferol’s proposal. Many in the neighborhood voiced opposition to the proposal, and Ferol’s lawyer advised it that,-based, on the amount of public opposition, the applications were sure to be denied. Under the Code of Ordinances, when a license application is denied, the applicant is disqualified from applying for the same license for the same premises for one year. See Milwaukee Code of Ordinances § 85-13-4-a. After considering the advice of its lawyer, Ferol decided to withdraw its applications rather than risk having the applications- denied and being prohibited from reapplying for one year.

In August 2010, Ferraro decided to reapply for tavern and tavern-amusement licenses for Satin. He also decided to attempt to open a third erotic dance establishment in the City of Milwaukee and formed Six Star for the purpose of operating that establishment, which would have been named Silk East. Six Star proceeded to execute a lease for a location on Old World Third Street in downtown Milwaukee and to apply for the necessary tavern and tavern-amusement licenses.

[945]*945Soon after Ferol and Six Star filed their applications, community members expressed opposition to the proposals. However, rather than withdraw their applications, both Ferol and Six Star decided to proceed to a hearing before the Licenses Committee of the Milwaukee Common Council, which was held on September 20, 2010. During the hearing, the Committee heard testimony from members of the communities surrounding each proposed establishment. The plaintiffs had lawyers present and were permitted to cross-examine the community members who testified in opposition to the applications. The plaintiffs were also permitted to present their own witnesses in support of their applications.

The Committee heard Six Star’s applications first. Sixteen witnesses testified in opposition to its proposal for the Old World Third location. Ten of those, witnesses represented commercial interests in the neighborhood, such as existing retail stores, hotels, and business associations. They almost uniformly opposed using the location as an erotic dance establishment on the ground that such a use would have been inconsistent with a development plan that had been adopted for the neighborhood. The business representatives testified that the goal of the development plan was to attract more retail establishments to the neighborhood, such as clothing stores and other shops, and that the presence of a gentlemen’s club would deter retailers from moving in. Most of the remaining witnesses were residents of the neighborhood, including individuals who lived in apartments above the proposed location. Those witnesses expressed concern about the noise that the proposed establishment would generate, about the safety of the neighborhood given the kind of clientele adult establishments are known to attract, and about the effect of the establishment on property values. Some of the residents also noted that the area was already oversaturated with bars and night clubs. One resident, Francisco Camacho, indicated that he found erotic dancing offensive. He testified that he opposed both ‘Six Star’s and Ferol’s proposals on the ground that erotic dancing perverts the community and is against the teachings of Islam.

Alderman Bauman, the alderman for the district, testified in opposition to Six Star’s applications. He mostly emphasized the concerns of the business community and their efforts to turn the area into one focused on shopping and retail. As he explained:

There is an inherent conflict between trying to generate retail and commercial with a gentlemen’s club. Forget the morality issue, forget the propriety of it all; just look at the economics of it. They are somewhat different markets. They are looking for different things by their very definition. And you’re not going to put an American Girl’s store next to a gentlemen’s club on Chicago Avenue and Michigan Avenue, for example. They are conflicting markets.
■ You’ve heard from the downtown. The City of Milwaukee has invested, I believe it’s $50,000 with a match from the downtown stakeholders of another $50,000 for a $100,000 fund to attempt to catalyze downtown retail investment. Again, we’re working at cross purposes. If we allow clubs that will retard that retail development, our investments are making no sense.

Continuation of Licenses Committee Hearing Tr., Sept. 20, 2010 at 12-13, ECF No. 61-2.

Oncq all testimony had been taken, the Committee discussed Six Star’s applications.

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Bluebook (online)
932 F. Supp. 2d 941, 2013 WL 1130437, 2013 U.S. Dist. LEXIS 37026, Counsel Stack Legal Research, https://law.counselstack.com/opinion/six-star-holdings-llc-v-city-of-milwaukee-wied-2013.