Enforcement of sex shop rules halted

Adult entertainment businesses continue their decades-long fight against zoning rules that restrict business locations. In the latest installment in the City’s efforts to restrict adult entertainment establishments, a federal court enjoined enforcement of the City’s zoning resolution. This is the latest court action in a series of actions that began in 1994.

In 1994 a City Department of City Planning study identified significant negative community secondary effects associated with the adult entertainment business. The New York City Council relied on the study to amend the zoning resolution to bar adult establishments from residential zones and most commercial and manufacturing zones. The Council also mandated that adult entertainment businesses where permitted had to be at least 500 feet from houses of worship, schools, day care centers, and other adult entertainment businesses.

Three years later, the City defined an adult establishment as any commercial establishment with at least 40 percent of its customer‑accessible floor/cellar area or stock‑in‑trade used for adult purposes. This so-called “60/40 test” was used by the City to identify and enforce the City’s zoning resolution.

Many adult entertainment establishments adapted to the 60/40 test by technically complying but without practical effect. The City revised the definition and, in 2001, the Council amended the zoning resolution to define adult entertainment establishments by reference to live performances characterized by an emphasis on certain “specified anatomical areas” or “specified sexual activities” in any portion of the establishment, regardless of whether the business limited those performances to less than 40 percent of its floor area. A club with dancers qualified as an “adult eating or drinking establishment” no matter what proportion of its space was devoted to adult entertainment.

Adult entertainment businesses challenged the 2001 amendments. They alleged that new definitions of “adult theater” and “adult bookstore” violated their First Amendment rights.

The Supreme Court, New York County, agreed with the adult entertainment businesses, declared the 2001 amendments unconstitutional, and enjoined their enforcement. The Appellate Division, First Department, affirmed the lower court’s holding, and the City appealed to the Court of Appeals.

On June 6, 2017 the Court of Appeals reversed, upheld the zoning rules as constitutional, and dismissed the adult entertainment businesses’ complaint. The Court held that the City had met its constitutional burden under the First Amendment and that the zoning amendments of 2001 did not violate the adult establishments’ First Amendment rights.

In 2019 a new federal lawsuit was filed by 725 Eatery and other adult entertainment establishments. These establishments would not be considered “adult establishments” under the 1995 regulation, but would be considered “adult establishments” under the broader 2001 amendments. The adult entertainment establishments asked the federal court to declare the 2001 Amendments unconstitutional and to enjoin enforcement of the 2001 amendments.

United States District Court Judge William H. Pauley III agreed with the adult entertainment businesses, issued a preliminary injunction against enforcing the 2001 rules, and continued the litigation to determine the adult entertainment businesses’ constitutional claims. Judge Pauley noted the impending hardships these businesses would face if the 2001 amendments were enforced included loss of business; breach of contracts and leases; and laying off of employees. Granting a preliminary injunction, Judge Pauley found, would not result in any harm to the City since the City had not enforced the 2001amendment for 18 years.

725 Eatery Corp. v. City of New York, 408 F. Supp.3d 424 (S.D.N.Y. 2019).

By: Raphael Cohen (Raphael is a New York Law School student, Class of 2021.)


Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.