In City of Los Angeles v. Patel, the Supreme Court invalidated a Los Angeles law that allowed law enforcement officials to inspect hotel and motel guest registries at any time, without a warrant or administrative subpoena. The Court ruled that the law violated hotel owners’ Fourth Amendment rights because it “penalizes them for declining to turn over their records without affording them any opportunity for pre-compliance review.”

In reaching its decision, the Court also announced two findings with implications for future lawsuits brought under the Fourth Amendment:

  1. Facial challenges to statutes are permitted under the Fourth Amendment
  2. Hotels and motels do not fall under the “pervasively regulated” exception to the warrant requirement

The law at issue, Los Angeles Municipal Code § 41.49, requires hotel and motel operators to collect and store a variety of information about their guests. This information includes their name, address, number of people in their party, the make, model, and license plate number of any vehicle parked on hotel property, and customer credit card information.  Hotel operators must make these records available to any officer of the Los Angeles Police Department (“LAPD”) for inspection at any time, as long as the inspection is conducted in a way that minimizes interference with the operation of the business. Failure to make these records available could result in immediate arrest, up to six months in jail, and a $1,000 fine. Respondents, a group of motel operators and a lodging association, challenged only the provision of the law that required hotel operators to make these records available to any LAPD officer for inspection.

Writing for the majority, Justice Sotomayor found that the Court has long allowed facial challenges under the Fourth Amendment, and rejected the City’s argument that Supreme Court precedent required Fourth Amendment challenges to proceed under an “as applied” challenge. This would have required motel operators to argue that the ordinance was unconstitutional as it was applied to them specifically. The Court held that its precedent should only by interpreted to mean that facial relief under the Fourth Amendment is unlikely to succeed where there is “substantial ambiguity” as to what the statute authorizes. As a result, the Court found that facial challenges are permitted, and laws that will always be applied in an unconstitutional manner can be challenged as such.

Turning to the provision of the statute as issue, the Court found that absent situations such as consent or exigent circumstances, the subject of a search must be afforded an opportunity to obtain precompliance review before a neutral decision maker. Given that a hotel operator that refuses to cooperate with an inspection request can be arrested on the spot, the Court held that they are not afforded an opportunity for meaningful precompliance review, and that the ordinance creates “an intolerable risk that searches authorized by it will exceed statutory limits, or be used as a pretext to harass hotel operators and their guests.” This ruling, however, only finds that hotel operators are entitled to an opportunity to object to an inspection request. The Court did not find that officers should only conduct a search with probable cause, or that precompliance review will be necessary in the majority of situations.

The Court disagreed with the City and the dissent, who argued that hotel operators fall under the “pervasively regulated” exception to the warrant requirement. Pervasively regulated entities have “such a history of government oversight that no reasonable expectation of privacy . . . could exist.” Entities that are pervasively regulated must satisfy a lower level of review: (1) there must be a substantial government interest that informs the regulatory scheme; (2) the warrantless inspections must be necessary to further the scheme; and (3) the statute’s inspection program must provide a constitutionally adequate substitute for a warrant.  The majority found that in forty five years, the Court had only found four industries as pervasively regulated: liquor sales, firearms dealing, mining, and automobile junkyards. The Court ruled that classifying hotel operators as pervasively regulated “would permit what has always been a narrow exception to swallow the rule,” and declined to do so. Writing for the dissent, Justice Scalia pointed out that while the Court has only found four industries as pervasively regulated, lower courts have found a diverse array of business to fall under that category, including pharmacies, massage parlors, day care facilities, jewelers, barbershops, and rabbit dealers.

The Supreme Court’s decision empowers hotel and motel operators to better protect the privacy of its guests. However, the mandatory collection of information remains intact, and the Court’s dicta suggests that even the most cursory of challenge proceedings might be sufficient to pass constitutional scrutiny. Nonetheless, by allowing facial challenges and refusing to subject hotel operators to a lesser standard of review, the decision signals the Court’s commitment to ensuring that warrantless law enforcement surveillance is subjected to some level of judicial oversight.