NEW YORK CITY-The city's ban on billboard advertising within 200 feet of arterial highways does not offend the First Amendment, a unanimous panel of the US Court of Appeals for the Second Circuit ruled Wednesday. "Supreme Court precedent instructs that, if the city's determination about how to regulate outdoor commercial speech is 'reasonable'--and we find that it is in this case--then we should defer to that interpretation," Judge Richard C. Wesley wrote for the circuit in Clear Channel Outdoor Inc. v. City of New York.

The ban passes constitutional muster, the panel concluded, even though it only applies to billboards that advertise products or businesses that are not in the immediate vicinity of the signs. Likewise, the fact that the city has allowed some advertising on government property along the roadways does not compromise the commercial speech rights of excluded private companies, the circuit concluded.

In a related case, Metro Fuel v. City of New York, the circuit on Wednesday upheld separate zoning rules setting location and illumination requirements for smaller outdoor advertising signs referred to as "panels," even though the city has entered into a contract allowing such panels on bus stops, newsstands and other "city furniture."

The challenge to the highway billboard ban was brought by five major outdoor advertisers: Atlantic Outdoor Advertising, Scenic Outdoor, Troystar City Outdoor, Willow Media and Clear Channel. Clear Channel claimed to have 85 signs in place along the highways, varying in size from 315 square feet to more than 11,000 square feet, which could be subject to the city's ban. New York City has designated more than 70 expressways, parkways, boulevards and toll crossings as arterial highways.

Metro Fuel, which challenged city requirements for smaller outdoor signs advertising "off-premises" businesses and services, claimed to have 334 signs, which could be subject to removal orders and/or fines that could rapidly escalate into thousands of dollars. Metro Fuel's panels, many of which were displayed at ground level in businesses and parking lots, were about 24 square feet in size.As a part of the city's 2006 contract with Cemusa, the Spanish company was authorized to develop advertising platforms with revenues to be shared with the city. According to the opinion, the city conceded that Cemusa has developed illuminated advertising panels on its bus-stop shelters that are "approximately the same size as, and sited in the same manner as" Metro Fuel's. The five advertisers also argued that the arterial highway ban is constitutionally undermined by the existence of at least 1,400 signs on government property, including those erected under the Cemusa contract.

Since 2001, the city has twice strengthened its laws to toughen enforcement of zoning requirements for outdoor signs that have been in place since the 1940s. Strengthened enforcement did not begin until 2006, when the Department of Buildings issued new regulations implementing the new laws.

Yesterday's decision affirmed a 2009 ruling by Southern District Judge Paul A. Crotty. (http://www.globest.com/Admin/news/1380_1380/newyork/177830-1.html) The advertisers' First Amendment challenge was foreclosed by the US Supreme Court's 1981 ruling in Metromedia Inc. v. City of San Diego, Judge Wesley concluded. The San Diego ban upheld by the high court, like New York City's, specifically exempted signs advertising businesses within their immediate vicinity.

In Metromedia, Judge Wesley wrote, "the Court made explicit reference to the exceptions in the ban of off site advertising but did not find the exemptions constitutionally problematic." Similarly, he noted that the Ninth Circuit had addressed the question of whether a city could ban most off-site advertising while contracting with a city vendor to permit similar advertising at city-owned transit stops in Metro Lights LLC v. City of Los Angeles.

The Second Circuit adopted the reasoning expressed by the Ninth Circuit in Metro Lights: "The proliferation of off site advertising by numerous and disparate parties creates more distracting ugliness than a single, controlled series of advertisements on city property over which the city wields contractual supervision." Victor A. Kovner of Davis Wright Tremaine, who represented Clear Channel, declined to comment. Working on the case with Kovner were James Eric Rosenfeld and Linda Jane Steinman, also of Davis Wright.

Karen Griffin, a senior counsel at the Law Department who was the city's lead lawyer on the appeal, said, "We are pleased that the appellate court has upheld the city's ability to eliminate the proliferation of illegal billboards and other advertising signs throughout New York City." Deputy appeals chief Francis Caputo also worked on the appeal.

Richard Emery, of Emery, Celli, Brinckerhoff & Abady, who represented the four other large advertising companies, declined to comment. Eric D. Hecker, also of Emery Celli, represented Metro Fuel.Daniel Wise can be reached at [email protected]