OPINION ANALYSIS

In Austin sign spat, court declines to strike down billboard regulation under First Amendment

The Supreme Court on Thursday ruled that a city ordinance that treats signs differently depending on whether they have a connection to the site where they are located is content-neutral – that is, it does not regulate speech based on content – and therefore not subject to strict scrutiny, the most stringent constitutional test. By a vote of 6-3, the justices sent the challenge to the ordinance in Austin, Texas, back to the lower courts for them to consider whether the sign code can survive under a less rigorous test. The decision was a victory not only for Austin but also for the tens of thousands of other municipalities with similar sign ordinances.

The dispute before the court in City of Austin v. Reagan National Advertising began when Reagan National, an outdoor advertising company, applied for permits to convert existing billboards to digital displays, which allow them to change the images that are shown every few seconds.

Under Austin’s sign ordinance, “on premises” signs – that is, signs advertising businesses with a connection to the site where the sign is located – are allowed, but new “off premises” signs, which advertise businesses or activities that lack such a connection, are generally barred. Owners of pre-existing off-premises signs are also prohibited from converting them to digital signs, while on-premises signs may be converted.

When the city denied Reagan National’s application, the company went to court, arguing that the ban on digitizing off-premises signs, while allowing the digitization of on-premises signs, violated the First Amendment. A federal district court rejected that claim, but the U.S. Court of Appeals for the 5th Circuit reversed. It reasoned that because someone would have to read the sign to determine whether the sign advertises activities or services located on or off the premises, the sign code regulates speech based on content and is therefore subject to – and fails – strict scrutiny.

On Thursday, the Supreme Court reversed the 5th Circuit’s ruling. In an opinion by Justice Sonia Sotomayor, the majority characterized the lower court’s rule as “too extreme an interpretation of this Court’s precedent.” The 5th Circuit had relied on the Supreme Court’s 2015 decision in Reed v. Town of Gilbert, which struck down a sign code that treated some speech – such as “ideological” or “political” speech – more favorably than, for example, signs promoting church services or educational events. But that case involved a “very different regulatory scheme” from this one, Sotomayor observed.

In contrast to the sign code in Reed, Sotomayor continued, Austin’s ordinance only takes the speech into account to determine whether the sign is located on- or off-premises. The city does not “single out any topic or subject matter for differential treatment.” Because the city’s distinction rests only on location, rather than on content, Sotomayor concluded, it is not subject to strict scrutiny.

Thursday’s decision, Sotomayor stressed, settled only the question of the proper legal test that applies to Reagan National’s challenge. Among other things, she noted, even when the less stringent test – known as intermediate scrutiny – is applied, the city must still show that the code is drawn narrowly to advance a significant government interest. The case will now return to the lower courts for them to address these issues, Sotomayor explained.

Justice Stephen Breyer joined the court’s opinion but wrote separately to reiterate that he believed that the court’s decision in Reed “was wrong.” In his view, Reed “too rigidly ties” discrimination based on the content of speech to strict scrutiny. Instead, Breyer advocated an approach that he suggested would “treat content discrimination as a rule of thumb to be applied with what Justice Kagan has called ‘a dose of common sense.’” In this case, Breyer noted, because there is no reason to believe that the city’s regulation of off-premises signs is intended to suppress a particular viewpoint, there is “little reason to apply a presumption of unconstitutionality to” the city’s sign code.

Justice Samuel Alito agreed with the court’s decision to reverse the 5th Circuit’s ruling that the sign code is unconstitutional in all circumstances. But he contended that, at least in some cases, strict scrutiny should apply because the provisions defining on- and off-premises signs do discriminate based on the messages that the signs express.

Justice Clarence Thomas dissented, in an opinion joined by Justices Neil Gorsuch and Amy Coney Barrett. In his view, the city’s sign code is content-based, and therefore presumed to be invalid, because it “discriminates against certain signs based on the message they convey” – in particular, whether they promote events, activities, or services that are on or off the premises. The majority’s conclusion that the sign code is content-neutral because it bans a “sufficiently broad category of communicative content” and as a result “does not target a specific ‘topic or subject matter’” replaces the “clear rule” established in Reed “with an incoherent and malleable standard.” Thomas compared the majority’s approach in this case to what he characterized as its “erroneous decision in Hill v. Colorado,” the 2000 case that “upheld a blatantly content-based prohibition on ‘counseling’ near abortion clinics on the ground that it discriminated against ‘an extremely broad category of communications.’”

This article was originally published at Howe on the Court.