NEW ORLEANS – In a 2-1 decision issued Wednesday, a divided panel from the U.S. Court of Appeals for the Fifth Circuit reversed a trial court’s ruling which held that Three Expo Events, one of the companies associated with the Exxxotica series of adult trade events, lacked standing to sue the City of Dallas in a case dismissed by a district court in 2016.

The controversy reaches back to the aftermath of Exxxotica’s 2015 event in the city – not because of any specific incident or mishap, but simply because the adult nature of the event didn’t sit well with some Dallas residents, activists and politicians.

As Judge James L. Dennis wrote in the majority opinion, while Exxxotica Dallas 2015 was “well attended and successful economically,” the fact the event “featured near nudity and sexually suggestive activities, drew opposition from some citizens on moral and civic grounds.”

Local activists pressured city officials to do something to prevent future editions of the show from being held at the Kay Bailey Hutchison Convention Center, which is owned by the City (a fact which may soon change).

On February 10, 2016, the Dallas City Council held a meeting to discuss whether it should adopt a resolution banning Exxxotica 2016 from the Convention Center, at the request of Mayor Mike Rawlings. The text of the resolution included language which directed the City Manager “to not enter into a contract with Three Expo Events, LLC, for the lease of the Dallas Convention Center.”

Two weeks later, Three Expo filed suit against the City in federal court and asked the court to issue a preliminary injunction to prevent the City from enforcing its new resolution. The district court denied the request and no Exxxotica event took place in Dallas that year.

After its injunction was denied, Three Expo amended its complaint, claiming the City’s resolution and other actions violated the First Amendment, the Equal Protection Clause, and the Bill of Attainder Clause of the U.S. Constitution. The City moved for dismissal, arguing that Three Expo lacked standing to sue. The district court granted the City’s motion and dismissed the complaint – which brings us to what the Fifth Circuit decided Wednesday.

As noted by Dennis in the decision, the City’s argument that Three Expo lacked standing was based “almost entirely on the wording of the City Council’s resolution and an inference from Three Expo’s past business practice.”

“In disregard of the evidence fully describing the circumstances surrounding the actions of the mayor, the City Council members, and the aroused citizens, taken to ban Exxxotica 2016 from the Convention Center,” Dennis wrote, “the City glibly argued that ‘the Resolution did not cause Three Expo to suffer an injury in fact’ because the resolution prohibited only Three Expo from contracting with the City Manager, and Three Expo had planned to follow its usual practice of having its subsidiary entity, Exotica Dallas LLC, enter and hold the lease of the Convention Center for Exxxotica 2016.”

Dennis and the judge who concurred with him, E. Grady Jolly, found that the district court “readily and uncritically accepted the City’s argument, erroneously found facts mirroring that argument, and dismissed Three Expo’s lawsuit.”

“Although they intended to prohibit Exxxotica 2016 under any circumstance, the resolution, as drafted, literally prohibited the City Manager from entering such a contract only with Three Expo,” Dennis continued. “However, no reasonable factfinder can read the record of the events leading up to and during the City Council meeting without finding that the mayor and City Council firmly intended to make certain that the Exxxotica convention would not be staged by anyone in the Convention Center in 2016.”

Given this clear intent, Dennis found that “a realistic sense of the purpose and effect of the resolution in this context was that Three Expo, the undisputed promoter and proposed presenter of Exxxotica 2016, was banned from presenting Exxxotica 2016 at the Dallas Convention Center under any guise or circumstance.”

In her dissent, Judge Jennifer Walker Elrod argued the majority opinion “ignores the text of the City’s resolution” and “ignores the fact that the plaintiff never tried to contract with the City after the resolution was passed.”

“Even though the resolution’s text does not ban Exxxotica from occurring, Exotica Dallas did not even try to contract with the City after the resolution’s passage,” Elrod wrote. “It is pure speculation that when presented with an actual contract from an entity not named in the resolution, the City would have read a broader ban into the resolution’s text.”

Attorneys for the City have not commented on the Fifth Circuit’s decision. Roger Albright, Three Expo’s counsel in Dallas, hailed the decision on Wednesday in comments offered to the Dallas Morning News.

“It’s great,” Albright said. “It absolutely supports our legal position and the constitutional rights of Three Expo to have access to a public forum such as the Dallas convention center. I would also now be hopeful that since this case is being handled by the City Attorney’s Office, we can collectively find a path to resolution.”

Kay Bailey Hutchison Convention Center Image Copyright Frj