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D. Russo, Inc. v. Romankow

A-0633-08T1 (N.J. Super. App. Div. 2010) (Unpublished)

ADULT BUSINESSES — A municipality seeking to uphold its zoning restrictions on sexually oriented businesses has the burden of proving the availability of alternative locations where an owner can operate its business.

The owner of a sexually oriented business was indicted by a grand jury on several counts of operating within 1,000 feet of a residential or recreational area. He then sued both the municipality in which the business was located and the county prosecutor, seeking injunctive and declaratory relief concerning the constitutionality of the charged criminal statute as applied.

After a trial, the lower court upheld the constitutionality of the statute. The owner appealed, arguing that the municipality failed to prove the existence of alternative sites where the owner could operate his sexually oriented business within the relevant market area. The owner also argued that the municipality’s expert witnesses’ testimony concerning the availability of alternate sites within the relevant market area should have been rejected by the lower court as net opinions.

Even sexually oriented businesses provide a form of expression protected by the First Amendment. Thus, under prior case law, a municipality has the burden of proving what constitutes an owner’s relevant market area and what alternative sites are available where the owner can operate. Courts are required to consider the relevant market area of the sexually oriented business, the availability of alternative sites within the relevant market, and whether the available sites, in relation to the size of the market area, provide enough suitable alternative sites for First Amendment expression to comply with constitutional standards. The government bears the burden as to each of the three factors.

None of the three experts who testified employed a consistent approach or methodology in opining as to what constituted the club’s relevant market area. As the fact finder, the lower court did not reconcile or attempt to harmonize their distinctive methodologies.

The owner argued that the lower court should have been required to determine the availability of a site by taking into account the area’s population and the geographical location of the particular site. The municipality maintained that the court was not required to take population into account. The Appellate Division found that proposed alternate sites must be feasible, and, in this case, determined that the municipality had met its burden of proof on the question of available alternative channels. However, the Court held that the location of a suitable site cannot be used to define the relevant market area. Therefore, the Court remanded the matter to establish available sites after the relevant market area had been delineated.

Finally, the owner argued that the lower court failed to determine whether the available sites, in relation to the size of the market area, constituted a constitutionally sufficient number of alternative sites. The lower court merely noted that a plethora of sites had been proposed and that numerous alternative avenues of expression were identified. According to the Court, the specific number of available sites within that market must be specified. In sum, for all of those reasons, the Court reversed and remanded for these factual findings to take place.

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