After more than five years of legal wrangling between Larry Flynt's Hustler Hollywood chain and San Francisco authorities over whether the city could deny permits for its stores based solely on their "adult" nature, a federal appeals court ruled that the city's ban on new adult businesses did not violate First Amendment free speech rights. Hustler Hollywood had filed suit against the city after it was denied permits to open adult stores in 2014, saying the city's policy was unconstitutional because it singled out the company for unfair treatment based on content of its merchandise. It sought an injunction preventing enforcement of the policy while it pursued its lawsuit in federal court. The city argued that the ordinance was constitutional because it applies equally to all adult businesses that want to operate within its limits. In 2016, a lower court judge sided with the city, but the Ninth Circuit Court of Appeals reversed that ruling Friday, finding that "the ordinance is content-based and therefore subject to strict scrutiny." It said the ordinance failed that test because it does not further any compelling government interest or leave open ample alternative channels for communication. The three-judge panel wrote that the city could have permitted adult businesses by requiring them to obtain special zoning approval instead of banning them altogether. The panel also noted that adult bookstores are currently allowed to sell sex toys, DVDs and other items.
The case stemmed from the closure of two Hustler Hollywood stores in San Francisco in January 2015 over local zoning laws, which allow only one such store per block, and Flynt's desire to expand into the city's Castro neighborhood where there are no such restrictions. Hustler Hollywood has locations in Los Angeles, Las Vegas and Houston. After failing to secure a permit for a new location at 478 Castro St., Flynt sued the city, claiming the permit denial violated his First Amendment rights as well as California state law, which bars local governments from imposing an "undue restriction" on sexually oriented businesses.
In a statement, Flynt called the decision a victory for free speech and urged the city to reconsider the policy. "We applaud today's decision and look forward to working with the City of San Francisco in creating a fair and equitable permitting process," he said. "Hopefully they will finally understand that our retail stores serve the public good." In response, the city attorney's office said it was disappointed in the ruling but "will continue to defend the ordinance vigorously."