SP Star Enterprises, Inc. v. City of Los Angeles

SP Star Enterprises, Inc. (Star) (plaintiff), which owned and operated a strip club, applied for a conditional-use permit allowing it to sell alcohol and allowing its patrons to consume alcohol at the club. The city zoning administrator granted a one-year conditional-use permit. Nearby property owners appealed the decision to the Los Angeles Central Area Planning Commission (APC), arguing that the sale and consumption of alcohol at the club was incompatible with religious and community uses in the area. The APC upheld the appeal and denied the permit, applying two provisions of the Los Angeles Municipal Code (LAMC). The first provision required the APC to make several findings, including a finding that the proposed location would be desirable to the public convenience or welfare, before approving a conditional-use permit. The second provision, specific to the grant of alcohol permits, required the APC to find that the proposed use would not adversely affect the welfare of the community. Star sued the City of Los Angeles (the city) (defendant), requesting a writ of mandate compelling the city to issue the permit. The court denied Star’s petition, and Star appealed to the California Court of Appeal. On appeal, Star argued that the denial of the permit had been pretextual and that the true reason for the denial was to discriminate against Star because it engaged in a disfavored form of protected expression. Star argued that, because the core issue in the case was the fundamental right to free speech, the court was required to review the APC’s decision under the strict-scrutiny standard. The court determined that strict scrutiny was not required because the core issue in the case was the right to sell alcohol and not the right to free speech, and it instead applied the less-demanding standard of general health, safety, and welfare.