The Alaska Supreme Court rejected a lawsuit Sept. 22 challenging the constitutionality of a Skagway ordinance passed in 2003 to halt "off premises canvassing (and) the proliferation of aggressive sales tactics" targeting tourists and other pedestrians.
The high court decision reversed a 2004 ruling by Superior Court Judge Larry Zervos in favor of two Skagway tour business operators who claimed the law infringed on their commercial free speech. "As far as the city is concerned, we have an enforceable ordinance," said Skagway Mayor Tim Bourcy Oct. 2, but the court opinion and an attorney opposing the city leave open the possibility of further court action.
The ruling, however, leaves open the possibility that Terry Robertson, owner of Skaguay Tour Co., and David A. Lee, owner of Southeast Tours, could pursue claims the high court did not consider. Juneau attorney Philip Pallenberg, who represented Lee, said the constitutionality of the law is a settled question, baring the unlikely possibility that his client will choose to take the case to the U.S. Supreme Court. However, he suggested the dispute could continue next spring depending on whether, or how, Skagway enforces its law.
"I think, on the legal points in the opinion, that the decision of the Supreme Court is ... the final word," Pallenberg said Oct. 2. Regarding issues the high court did not address, he added, "We have not made any decisions on whether we will pursue those or how we will pursue those. In part, that's going to depend on what action the city takes now, I mean what the city does on enforcing the ordinance next spring."
Pallenberg said "serious conflicts of interest issues" remain, including the competitive help passage of the ordinance gave to other tourism businesses, including some belonging to members of the Skagway City Council.
"Several members of the city council that passed that ordinance had financial interests in the tour business that were substantially affected by passage of the ordinance ... It's an ordinance that favored some tourism businesses at the expense of others by limiting how tours could actually be sold," Pallenberg said.
Mayor Bourcy, who held the office when the law was passed, adamantly rejected that notion. "There's no conflict of interest in my mind. Everyone in town is connected to the tourism business one way or another. I don't know how you separate that," he said, adding that many other local businesses endorsed passage of the ordinance.
"It was a problem. It wasn't something we invented. It's something we're trying to regulate," Bourcy said.
Robertson, who reached a confidential settlement on some of his claims with Skagway that involved a monetary payment, declined to be interviewed. Lee could not be located for this report. His suit complained that the law was passed in May 2003, after he and other affected businesses had made the "maximum possible investment" in preparation for the tourist season. However, he did not seek damages for lost income, and Pallenberg declined to explain why not.
The 2003 law was Skagway's second attempt to limit "off-premises canvassing," which Bourcy said had become a bother to anyone walking in the city's historic district. The first try, passed in 2001, was found to be unconstitutionally overbroad by Superior Court Judge Larry Weeks in 2002 in response to a suit filed by Lee and others.
The 2001 law prohibited sales of anything of value on public streets or sidewalks anywhere in the city or on private property within 10 feet of a public street or sidewalk. The current ordinance is modeled closely on one adopted by the City of Sedona, Ariz., to control bothersome hawkers peddling condominium time-shares.
Sedona is a "very hot market" for condo time-shares and its law against off-premises canvassing was also challenged, according to city attorney Mike Goimarac. Its constitutionality was challenged in Arizona Superior Court in 2002, but the suit was dismissed after an application for a preliminary injunction to block its enforcement was denied. A second action was filed in U.S. District Court for Arizona in 2004, but dropped when a nonmonetary out-of-court settlement was reached.
The Sedona law allows civil fines up to $250 for a single violation and a $500 fine for repeats within 30 days, or prosecution in either case as a Class I misdemeanor, which carries a penalties up to $2,500 and six months in jail. Employers and individual solicitors are both liable for violations.
The settlement followed the establishment of an off-premises canvassing board that reviews complaints against pushy salespersons before any fines or charges.
Sedona officials received 150 written complaints of off-premises canvassing between 1996 and 2002 and "indications of numerous additional verbal complaints" from visitors, according to its amicus brief, but none since the board was established, Goimarac said.
"It's really worked out very well. We haven't had another criminal citation since we entered that settlement," Goimarac noted.
"We felt very good that the Alaska Supreme Court saw that we were really trying to make a very good good-faith effort not to limit speech, but just to limit it in a reasonable manner ... It was certainly possible, a few years ago, to be accosted several times if you were walking in a half-mile area," he said.
Skagway's law includes a finding that the proliferation of off-premises solicitation locations in its historic district "has resulted in complaints by pedestrians and tourists about the aggressive and persistent actions of such persons." In both cities, salespersons would use casual or high-pressure conversations, or other means to get customers into their business offices.
Beside the off-premises canvassing ban, the Sedona law also prohibits sales companies from posting signs indicating they are visitor information centers unless the signs also include the actual name of the business and the words "sales solicitation."
The Skagway law is not as specific regarding signs but focuses on actions. It prohibits canvassers from touching a person during a solicitation without their permission; intentionally inflicting "emotional distress by verbal or physical harassment or coercion;" the use of "offensively loud sound, vociferous speech, boisterous conduct," profanity, misrepresentation of price, quality or nature of the product being promoted or the source or sponsor of information being offered; and, soliciting an occupant of a stopped or moving vehicle.
The Skagway law also repeatedly notes that its purpose is "directed solely to the regulation of time, place and manner of certain limited forms of commercial speech." It also states that it is "not intended to regulate any form of speech other than speech designed to do no more than propose a commercial transaction."
It bans off-premises canvassing in the specifically identified boundaries of the historic district except within a business location of at least 200 square feet or within a "brokerage" building managed by a contractor for the city where some 40 businesses rent space.
"It's not as bad since the brokerage stated, but there's still one or two, maybe three or four, that are still somewhat of a problem," Mayor Bourcy said.
Judge Zervos acknowledged that off-premises canvassing is "clearly commercial activity and does not usually invoke protected speech" and said the Skagway law could be upheld if a "limiting construction" avoided constitutional problems. However he also wrote that the city seemed intent on regulating far more than just the outcry over tour sales.
"Given this intent, the only permissible ordinance would be one with significant exceptions to reduce the reach of the ordinance into protected areas," he wrote. He found that the law was not a reasonable time, place and manner restriction nor that it was narrowly tailored "because it is a blanket ban on sales in a public forum no matter what is being sold."
Rejecting the stated purposes in the ordinance and its focus on commercial speech, Zervos said, "The operative language means that not only is the sale of tours or tacos prohibited, but so is the sale of newspapers, bibles, books, art and any other expressive item that might be sold for profit."
The Supreme Court said, in effect, that Zervos' interpretation of the ordinance was overly broad. "We disagree with the Superior Court that the ordinance should be read to extend to noncommercial speech," the high court opinion declared. It added that "expressive items" such as "music, buttons and bumper stickers bearing political, religious and ideological messages ... do not lose their constitutional protection simply because they are sold rather than given away" and read the ordinance to apply only to purely commercial speech.
