Last week, a federal district court in Indiana rejected a billboard company’s claim that sign code amendments passed by Indianapolis following the Supreme Court’s decision in Reed v. Town of Gilbert violated the company’s First Amendment rights. Although the decision was a win for the city’s current code, the city is being forced to pay damages to the billboard company for the monetary losses faced by the company prior to the city’s passage of the sign code amendments.

Before November of last year, the Indianapolis sign code regulated on-premises and off-premises signs differently, with special regulations for advertising billboards. The code contained an exception to regulation for “noncommercial opinion signs,” defined as “[a] sign, which does not advertise products, goods, businesses, or services and which expresses an opinion or point of view, such as, a political, religious, or other ideological sentiment or support or opposition to a candidate or proposition for a public election.” The sign code furthered allowed digital signage on on-premises commercial signage, but not on other types of signage.

Last fall, GEFT Outdoor LLC, the plaintiff in the case, sought variances to allow installation of LED components on two billboards that it owned in the city and that displayed noncommercial messages. The city’s board of zoning appeals denied the variances on November 5, 2015.

Meanwhile, however, the city prepared amendments to the sign code that contained a substitution clause—a provision allowing the display of noncommercial messages on any sign authorized to display commercial messages—and that got rid of the prior definition of “noncommercial opinion signs” in favor of regulations of sign structures, i.e., yard signs, freestanding signs, etc. The sign code amendments went into effect on November 30, 2015.

In reviewing the case on summary judgment, the district court in Indiana found that the pre-amendment sign code violated the First Amendment due to the content-based definition of noncommercial opinion signs (akin to the one struck down in Reed), and because it treated commercial signs more favorably than noncommercial signs in violation of Metromedia v. City of San Diego. The court held that the city owed GEFT Outdoor damages for the pre-amendment violation. The court approved, however, of the post-amendment sign code. Specifically, the court noted that Reed did not upset several decades of case law regarding the commercial speech doctrine, and the court relied upon Justice Alito’s concurrence in Reed in determining that the on-premises/off-premises distinc

tion in the Indianapolis sign code remains valid. The court found that Indianapolis had directly furthered its interests in traffic safety and aesthetics, and that the regulations did not reach further than necessary to accomplish the city’s goals. Because the substitution clause remedied the city’s prior favoring of commercial speech, the amended sign code also met the requirements of Metromedia.

Here is an article about the case from around the time the case was filed.

GEFT Outdoor, LLC v. Consolidated City of Indianapolis and County of Marion, 1:15-CV-01568-SEB-MJD, slip op. (S.D. Ind. May 20, 2016).