November 9, 2015.
[Copyrighted Material Omitted]
from the United States District Court for the Eastern
District of Wisconsin. No. 2:10-cv-893 - Lynn Adelman, Judge.
Star Holdings, LLC, Plaintiff - Appellee: Jeff Scott Olson,
Attorney, Madison, WI.
Ferol, LLC, Plaintiff - Appellee: Jeff Scott Olson, Attorney,
City of Milwaukee, Defendant - Appellant: Adam B. Stephens,
Attorney, Milwaukee City Attorney's Office, Milwaukee,
WOOD, Chief Judge, ROVNER, Circuit Judge, and SHAH, District
case requires us to visit the world of strip
no one seems to want, officially, but that are somehow quite
lucrative. Prior to March 1, 2012, the City of Milwaukee had
various licensing requirements for this type of place, but it
no longer defends their constitutionality. The First
Amendment imposes a " heavy presumption" against
the " constitutional validity" of prior restraints
on speech. Bantam Books, Inc. v. Sullivan, 372 U.S.
58, 70, 83 S.Ct. 631, 9 L.Ed.2d 584 (1963). Prior restraints
that are viewpoint- and content-neutral and impose a
limitation only on the time, place, and manner of speech are
more likely to pass muster. See City of Lakewood v. Plain
Dealer Publ'g. Co., 486 U.S. 750, 763, 108 S.Ct.
2138, 100 L.Ed.2d 771 (1988); Blue Canary Corp. v. City
of Milwaukee, 251 F.3d 1121, 1123 (7th Cir. 2001). They
are permissible if, and only if, there are procedural
safeguards that ensure that the decisionmaker approving the
speech does not have " unfettered discretion" to
grant or deny permission to speak. Plain Dealer
Publ'g. Co., 486 U.S. at 755-57; Freedman v.
State of Maryland, 380 U.S. 51, 58-59, 85 S.Ct. 734, 13
L.Ed.2d 649 (1965).
us now are two Milwaukee ordinances, now repealed, that
required certain licenses before a business was permitted to
offer nude or partially nude entertainment. (When we say
" nude," we mean to include both total and partial
nudity; the difference between the two is immaterial for this
case.) Two companies--Six Star Holdings, LLC, which applied
for a license under one of these ordinances, and Ferol, LLC,
which did not--challenged these ordinances, seeking
injunctive relief and damages. Once the ordinances were
repealed, the plaintiffs dropped their requests for
injunctive relief but continued to pursue damages. The latter
request saves the case from mootness. See Buckhannon Bd.
& Care Home, Inc. v. W.Va. Dep't of Health & Human
Res., 532 U.S. 598, 608-09, 121 S.Ct. 1835, 149 L.Ed.2d
855 (2001). The district court held that the ordinances
addressed time, place, and manner of expression, but that
they did not include the necessary procedural safeguards. A
jury then decided that but for the unconstitutional
ordinances, Ferol would have opened a club providing nude
entertainment. It awarded Ferol compensatory damages in the
form of lost profits, and gave Six Star nominal damages.
City has appealed. It argues that Ferol had no injury and
therefore no standing to challenge the ordinances. It also
challenges Ferol's theory of causation and the award of
nominal damages to Six Star. Finding no merit in any of these
points, we affirm the district court's judgment.
Ferraro saw a business opportunity in what he regarded as a
shortage of nude-entertainment clubs in the Milwaukee area.
He created, and is the majority owner of, the two plaintiff
limited-liability companies: Six Star and Ferol. (He owns
other similar venues elsewhere in Wisconsin.) Ferraro wanted
to open two clubs in the downtown Milwaukee area. The one
owned by Six Star would be called " Silk East," at
730 North Old World Third Street, and the other, owned by
Ferol, would be called " Satin" and located at 117
West Pittsburgh Avenue.
the licensing regime in place before March 1, 2012, there
were three lawful ways to offer so-called adult
entertainment. To operate an establishment that offered both
alcohol and nudity, the proprietor was required to obtain a
liquor license, sometimes called a tavern license, and a
tavern- amusement license. See Milwaukee Code of Ordinances