Reed invalidates highway sign distance and permit regulations

Thomas v. Schroer, 2017 WL 1208672, No. 13-cv-02987 (W.D. Tenn. Mar. 31, 2017)

Reed may or may not work a sea change in First Amendment law generally, but it has definitely worked a sign change.

The Tennessee Department of Transportation (TDOT) promulgates and enforces regulation of billboards and outdoor advertising signs under Tennessee’s Billboard Regulation and Control Act of 1972 and under the Federal Highway Beautification Act of 1965.  Regulated billboards and signs under the Billboard Act are subject to location and/or permit and tag restrictions, e.g., they may not be “within six hundred sixty feet (660') of the nearest edge of the right-of-way and visible from the main traveled way of the interstate or primary highway systems ... without first obtaining from the commissioner a permit and tag.” Some signs, however, are exempted if they relate to the sale/lease of property on which they’re located or if they advertise activities conducted on the property on which they are located—these are known as on-premise signs.  Because, to qualify as an on-premise sign, one must compare the content of the sign to the activities on the premises, the court found the restriction content-based, and because it regulated all signs rather than just commercial signs, it had to survive strict scrutiny, which it did not.

The court commented that commercial sign regulations are subject to intermediate scrutiny, not to Reed’s strict scrutiny, but here the regulation affected both kinds of speech. 

Justice Alito described an off-premises/on-premises distinction as content neutral in his concurrence in Reed, but the court here found that would only be true if a regulation defined an on-premises sign “as any sign within [x] feet of a building,” rather than also considering the relationship between the content and the building’s use.  [The Reed dissents, too, pointed out that a number of the examples were content-based if you define content-based without any reference at all to the reasons we might want to protect speech against government regulation. Even if you do that, it seems plausible that no lawful content is barred by this regulation, depending on the use of the building.] 

First, the state’s interests were not compelling. The state identified interests in preventing the proliferation of billboards, improving (1) aesthetics and (2) traffic safety. These are substantial or significant interests, but not compelling interests.  Nor were they properly related to the speech-based distinctions made by the regulation—the distinction between on-premises-related content and other messages.  One of the defendant’s witnesses testified that signs with more content and signs outside the driver's field of vision may create greater distractions, i.e. “I would know the golden arches for McDonald's or BP for gasoline, I know that that facility sits at the bottom of that sign; and it's a very quick glance and back to the road.”  So that’s an interesting claim about the shorthand function of trademarks, but the court found it unrelated to off-premises/on-premises distinctions.

In fact, the court reasoned, the on-premises/off-premises distinction could interfere with the state’s interests, because “a small sign with muted colors that says “Knowledge is Power” off of 1-40 would require a permit and tag, and compliance with the six-hundred-sixty (660)- foot restriction. Conversely, a large sign with loud colors that states ‘This property is for sale. Right here. This one. The one this sign is on. Look at this sign. Look at this property,’ would require no permit or tag, and could be placed closer to another sign and the roadway.”

Even assuming the state’s interests were compelling, the law wasn’t narrowly tailored. The state argued that “[o]n- premise signs enhance safety by helping drivers locate relevant businesses and activities”; “[t]he impact on aesthetics [by on-premises signs] is minimal because the signs are already integrated with the current land use”; “[o]n-premise signs are inherently self-regulating ... [because] [o]wners of businesses do not want to spend valuable real estate putting up a number of signs—that space is better utilized for the business itself;” and off-premises signs are distracting.  But the state didn’t show that on-premises signs were less distracting than off-premises signs, or that they had less impact on aesthetics. “[T]he State’s conclusory assertion that business owners do not want to put up numerous signs is speculative and lacks evidentiary support. The assertion would certainly not be true for many firework vendors.”   

The law was also overinclusive because it regulated off-premises signs that were not highly distracting, and underinclusive because it didn’t regulate distracting on-premises signs.  The law was also not the least restrictive means to further the state’s interests.

First, the state could limit its regulation to only commercial speech; similar regulations have been upheld after Reed.  While a non-commercial/commercial distinction might be less effective than the current regulation, it wouldn’t be ineffective.  Second, size restrictions might be a content-neutral alternative furthering the traffic safety interest.  [Really?  What is a “sign”?  How do you make that determination content-neutral?]  Spacing requirements could also work, if they also allowed business owners to erect additional signs within a certain distance of a building.  An ordinance that exempted only signs that complied with the Manual on Uniform Traffic Control Devices might also be constitutional.

An alternative regulation might also “require all signs, regardless of content, to be a particular size, use a particular font (or a set of fonts), be limited to a particular colors, face a particular direction, or stand at a particular height, etc.” [Note that this might face federal preemption issues given federal protections for the display of registered trademarks.]

Anyway, bye-bye sign regulation.