BBL, Inc. v. City of Angola, 809 F.3d 317

Background

Alva and Sandra Butler (BBL, Inc.) bought a property in Angola, Indiana, intending to open an adult-entertainment venue (nude/pasties-and-g-string dancing) called “Showgirl.”
Angola quickly enacted two 2012 ordinances: a licensing ordinance imposing a 750-foot buffer from residences, and an amendment to the zoning code moving sexually oriented businesses to industrial districts and adding the same 750-foot residence buffer (retaining other dispersal rules).
BBL invested in the property, did some construction (stopped after a stop-work order), applied for an Improvement Location Permit and a sexually oriented business license; the license was denied due to the 750-foot rule.
BBL sued under § 1983 and Indiana law, alleging First Amendment violations (including a prior-restraint challenge to the permit requirement), zoning-procedure violations, and vested-rights claims; it moved for a preliminary injunction.
The district court granted the City partial judgment on the pleadings on several issues, denied BBL’s preliminary-injunction motion after BBL stipulated it would not contest the City’s secondary-effects justification at the preliminary-injunction stage, and left the adequacy-of-alternative-sites issue for further proceedings.
On interlocutory appeal limited to denial of the preliminary injunction, the Seventh Circuit affirmed, holding BBL’s stipulation foreclosed success on the First Amendment secondary-effects question and that the temporary gap between the two ordinances did not warrant injunctive relief; state-law vested-rights and procedural rulings were not reviewed on appeal.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether 2012 ordinances (750-foot residence buffer) violate First Amendment as content-neutral regulation of sexually oriented expression	The ordinances unduly restrict expressive conduct and fail Renton/Alameda Books requirements	Ordinances are justified to combat secondary effects of adult businesses and are content-neutral/time-place-manner restrictions	Court: BBL stipulated not to contest secondary-effects predicate at PI stage; without contesting that justification, BBL failed to show likelihood of success and PI was properly denied
Whether Improvement Location Permit requirement is an impermissible prior restraint on speech	Permit requirement functions as a prior restraint preventing operation of Showgirl	Permit requirement is generally applicable and not a content-based prior restraint; the 2012 licensing ordinance was later amended/eliminated	Court: Challenge to the repealed licensing provision is moot; the generally applicable improvement-permit requirement is not a First Amendment prior restraint
Whether the zoning/licensing 750-foot rule was adopted in violation of Indiana zoning procedure (600-series)	Licensing ordinance’s 750-foot rule was effectively a zoning change adopted without required plan commission procedures	City: licensing ordinance is not a zoning ordinance; in any event the same 750-foot rule was later adopted by proper zoning amendment	Court: Procedural classification not outcome-determinative for the PI because the zoning amendment containing the same buffer was validly adopted; PI denial stands
Whether BBL acquired vested nonconforming-use rights before ordinance changes	BBL contends substantial investment and preparatory steps vested rights before ordinance change (claimed August 9 bid date)	City argues no lawful preexisting use; construction that occurred violated permit requirements so no vested right	Court: No vested-rights showing sufficient to justify PI; unlawful construction and lack of actual preexisting use undercut claim

Key Cases Cited

Barnes v. Glen Theatre, Inc., 501 U.S. 560 (1991) (plurality) (nude dancing is expressive conduct but may be regulated under certain statutes)
City of Renton v. Playtime Theatres, Inc., 475 U.S. 41 (1986) (time, place, and manner framework for zoning regulations targeting secondary effects of adult businesses)
City of Los Angeles v. Alameda Books, Inc., 535 U.S. 425 (2002) (plurality and concurrence clarifying Renton approach and plaintiff’s ability to rebut secondary-effects evidence)
City of Lakewood v. Plain Dealer Publ’g Co., 486 U.S. 750 (1988) (generally applicable permit schemes are rarely treated as prior restraints closely tied to speech)
United States v. O’Brien, 391 U.S. 367 (1968) (test for incidental burdens on expressive conduct)
City of Erie v. Pap’s A.M., 529 U.S. 277 (2000) (plurality) (application of O’Brien to public-indecency statutes and regulation of nude dancing)