Zoning restrictions against adult businesses survive trial on adequacy of prior study. The Department of City Planning conducted a study on the negative secondary effects of adult businesses in the City, and concluded in 1993 that such businesses increased crime and lowered property values. Based on this study, the City in 1995 amended the zoning resolution to restrict the location of adult businesses in certain areas, banned the enlargement of existing adult uses, and prohibited the change of any use to an adult use. The amendment also defined “adult establishment” as a commercial establishment where a substantial portion (40 percent or more of accessible floor area) of the establishment included adult uses. Some adult businesses closed, but others remained legal by keeping their adult material within less than 40 percent of their accessible floor areas.

The City believed these 60/40 percent businesses were in sham compliance based on actual adult versus non-adult material sales receipts. In 2001, the City amended the zoning resolution again in 2001 to prevent stores which focused on providing adult material from avoiding the adult establishment restrictions. Adult businesses challenged the constitutionality of the amendments and sought a preliminary injunction.

The lower court granted the injunction on the ground that the City had not established a basis for the 2001 amendments. The court explained that adult establishments had spent time and effort conforming to the 40 percent restriction, and the City had not provided a new study demonstrating the negative effects, if any, of these altered businesses. The First Department reversed on appeal, and the Court of Appeals modified the reversal, ruling that a new study was not needed. Rather, the Court found that a trial was necessary to determine whether the altered businesses had changed so much that their main ongoing focus was no longer on sexually explicit material. If the focus had not changed, then the 1993 study’s findings would still apply and the 2001 amendments would be constitutional.

Justice Louis B. York, after a trial without a jury, ruled in favor of the City, finding that the dominant and ongoing focus of the bookstores and video stores was on adult matters. The court, however, found that two movie theaters did not primarily focus on adult matters despite the large number of peep shows in one theatre and the ability to view adult and non-adult movies with one admission in both.

For the People Theatres of NY, Inc. v. City of New York, 2010 N.Y. Slip Op. 20108 (N.Y.Cty.Sup.Ct. March 29, 2010) (York, J.) (Attorneys: Herald Price Fahringer, Erica T. Dubno, for adult businesses; Michael A. Cardozo, Robin Binder, Sheryl Neufeld, for NYC).