Maldonado v. Morales

556 F.3d 1037

Nano MALDONADO, Plaintiff-Appellant, v. Jeff MORALES, in his capacity as Director of the California Department of Transportation, Defendant, and Will Kempton, in his capacity as Director of the California Department of Transportation, Defendant-Appellee.

Nano Maldonado, Plaintiff-Appellant, v. Will Kempton, in his capacity as Director of the California Department of Transportation, Defendant-Appellee.

No. 06-15657.

No. 07-15535.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted August 13, 2008.

Filed February 25, 2009.

Dennis Scott Zell, Fogarty & Zell, LLP, Millbrae, CA, for the plaintiff-appellant.

Ronald W. Beals, Assistant Chief Counsel, California Department of Transportation Legal Division, Sacramento, CA, for the defendant-appellee.

Michael F. Wright, Case Knowlson, Jordan & Wright, LLP, Los Angeles, CA, for the amicus.

Appeal from the United States District Court for the Northern District of California, Charles R. Breyer, District Judge, Presiding. D.C. No. CV-02-03167-CRB.

Before: EUGENE E. SILER, JR.,^* M. MARGARET McKEOWN, and CONSUELO M. CALLAHAN, Circuit Judges.

McKEOWN, Circuit Judge:

Nano Maldonado has raised a number of constitutional challenges to the California Outdoor Advertising Act. Cal. Bus. & Prof. Code § 5200, et seq. As a consequence of a legislative amendment in 2008, the Act bars offsite commercial advertising but does not restrict non-commercial speech. Cal. Bus. & Prof.Code § 5275. Although some of Maldonado's claims are now moot because of this amendment, he continues to challenge application of the Act to his effort to display off-premises advertising on a highway billboard. This appeal is Maldonado's second trip to our court and requires us, once again, to reiterate our commercial speech jurisprudence involving billboards. We dismiss as moot Maldonado's appeal from the district court's injunction and affirm the district court's grant of summary judgment on his other claims.

I. BACKGROUND

Maldonado has had a long-running dispute with the California Department of Transportation ("Caltrans") over the use of a billboard on his property. In the early 1990s, he purchased property in Redwood City, California, that is adjacent to U.S. Highway 101. This land is in an area of Highway 101 that has been classified as "landscaped freeway." In 1993, Maldonado applied to Caltrans for a permit to use his billboard for offsite advertising. Because California's Outdoor Advertising Act ("COAA") bars property owners from using billboards along a landscaped freeway to advertise for offsite businesses, Caltrans denied the application. See Cal. Bus. & Prof.Code §§ 5440, 5442. Maldonado's efforts to skirt the offsite advertising ban have resulted in lengthy litigation at the state and federal level over the last ten years.

After Maldonado continued using the billboard for offsite advertising despite numerous citations, Caltrans sued him in California state court for nuisance. See People v. Maldonado, 86 Cal.App.4th 1225, 1228-29, 104 Cal.Rptr.2d 66 (Cal.Ct.App. 2001). The state court trial judge found in favor of Caltrans and enjoined Maldonado from continuing to violate the COAA. Id. at 1229-30, 104 Cal.Rptr.2d 66. The injunction barred Maldonado from: (1) "posting or displaying any advertising on his billboard without first having obtained from [Caltrans] either a permit for outdoor advertising, or an exemption from or waiver of the permit requirement;" (2) "posting or displaying any on premise advertising which does not direct the viewer to the billboard location for purposes of conducting business;" (3) "posting or displaying any on premise advertising for activities not conducted on [his] premises;" and (4) "posting or displaying any on premise advertising for products or services which are only incidental or secondary to the principal business activity conduct on [his] premises." Id. at 1233-35, 104 Cal. Rptr.2d 66 (internal quotations and citations omitted). The state court of appeals upheld all but the first of these prohibitions. Id.

Despite the injunction, Maldonado persisted in using his billboard for offsite advertising and was twice cited for contempt. He then sued in federal court, alleging the COAA violated the First Amendment, both facially and as applied to him. The district court dismissed the case on procedural grounds. We reversed that dismissal. See Maldonado v. Harris ("Maldonado II"), 370 F.3d 945, 956 (9th Cir. 2004). On remand, the district court held that the COAA unconstitutionally privileged commercial speech over non-commercial speech because it permitted onsite commercial speech but barred onsite non-commercial speech. Maldonado v. Kempton ("Maldonado III"), 422 F.Supp.2d 1169, 1178 (N.D.Cal.2006). The district court enjoined enforcement of the COAA against non-commercial speech on billboards where onsite advertising is allowed. Id. at 1178. The district court later found that the COAA, as amended by the injunction, is constitutional and granted summary judgment against Maldonado on his other claims.

Maldonado now challenges the district court's injunction and summary judgment ruling. He argues that the district court's injunction was not an appropriate remedy for the statute's unconstitutional preference for commercial speech. He claims that the COAA is overbroad and vague, that it imposes unconstitutional prior restraints on speech, that it violates equal protection, and that it violates substantive due process. He also claims that the state court injunction barring him from violating the COAA imposes a separate unconstitutional restraint on his First Amendment rights.

II. ANALYSIS

A. JURISDICTION

Before addressing Maldonado's substantive claims, we first resolve three threshold issues: whether the amendment to the COAA moots Maldonado's claims, whether he has standing to raise his claims, and whether his claims about the criminal enforcement provisions are ripe. See Kescoli v. Babbitt, 101 F.3d 1304, 1308 (9th Cir. 1996) ("If the appeal is moot, we lack jurisdiction."); Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 88-89, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998) (standing is a jurisdictional question that ordinarily must be resolved before addressing the merits); Texas v. United States, 523 U.S. 296, 301-302, 118 S.Ct. 1257, 140 L.Ed.2d 406 (1998) (courts should not reach the merits of unripe issues).

1. Mootness

On January 1, 2008, after the district court's injunction and after the two appeals consolidated in this case were filed, the California legislature amended the COAA. The new section, § 5275, reads:

Notwithstanding any other provision of this chapter, the director may not regulate noncommercial, protected speech contained within any advertising display authorized by, or exempted from, this chapter.

Cal. Bus. & Prof.Code § 5275.

With this amendment, the COAA now exempts non-commercial speech from regulation by Caltrans. The question then is whether this statutory change moots Maldonado's appeal. Mootness is "`the doctrine of standing set in a time frame.'" Abdala v. I.N.S., 488 F.3d 1061, 1063 (9th Cir.2007) (quoting Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 189, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000)). "A statutory change ... is usually enough to render a case moot, even if the legislature possesses the power to reenact the statute after the lawsuit is dismissed." Native Village of Noatak v, Blatchford, 38 F.3d 1505, 1510 (9th Cir. 1994).

Before enactment of this new provision, the district court held that the COAA impermissibly favored commercial over non-commercial speech, because it provided an exception only for onsite commercial advertising and not for non-commercial messages. The district court remedied this constitutional infirmity by enjoining Caltrans from enforcing the COAA against non-commercial speech: "the Court will enjoin the State from enforcing COAA to prohibit non-commercial speech wherever the Act permits commercial speech." Maldonado III, 422 F.Supp.2d at 1178.

Section 5275 incorporates the same solution to the constitutional problem that the district court implemented via the injunction, specifically carving out non-commercial speech from regulation. Cal. Bus. Prof.Code § 5275. Now that the statute has been amended to exempt non-commercial speech, the injunction is moot.¹ See Railway Labor Executives' Ass'n v. Gibbons, 455 U.S. 457, 465 n. 8, 102 S.Ct. 1169, 71 L.Ed.2d 335 (1982) (noting that the amendment of a law removing sections declared unconstitutional by a district court mooted that court's injunction).

Despite the changes to the COAA, Maldonado argues that because Caltrans stated that it will not change its enforcement policy, his claims are not moot. However, what Caltrans actually said is that it never enforced the COAA against non-commercial speech, even when the text of the law permitted it to do so. This statement was not a threat to flout the new law, but rather a promise to follow it.

Four of Maldonado's claims against the COAA were predicated on the COAA as reformed by the district court: (1) the COAA is overbroad and vague; (2) the COAA is enforced via unconstitutional prior restraints; (3) the grandfathering provision violates equal protection; and (4) the COAA violates the suppression doctrine and substantive due process. These claims do not depend on the lack of statutory exception for non-commercial speech and thus remain live controversies.

Maldonado's claim that the state court injunction bars him from exercising his First Amendment Rights is also unaffected by the changes to the COAA. Although the purpose of that injunction was to bar Maldonado from continued violation of the COAA, the language of the injunction bars him from engaging in offsite advertising on his billboard, not simply from violating the COAA. Therefore, the change to the COAA itself has no effect on this aspect of the state court injunction....