Fargo sex shop falters in Eighth Circuit push for downtown storefront

ST. PAUL (CN) — A sex shop and North Dakota’s largest city went head-to-head over zoning laws before an Eighth Circuit panel Tuesday, where the would-be downtown tenant argued Fargo unconstitutionally denied its permit.

Romantix-Fargo — the adult entertainment store — claims the city of Fargo approved its downtown retail location as long as it removed sexually oriented books, magazines and other periodicals so the location could not be categorized as an “adult bookstore.”

Despite following the city’s guidance, Romantix claims the planning director later determined the sheer volume of adult novelties made the store effectively the same as an adult bookstore — which are not allowed downtown.

Since the initial denial, Fargo has adopted new ordinances specifically banning a Romantix-style store from operating in the city — a change Fargo’s attorney, Scott Bergthold, emphasized to the three-judge panel Tuesday as a reason for mootness.

“Even if they showed an inconsistent application, or even if they say that this is a mistake, that doesn’t prove that they are entitled to a change of use permit to go open an adults-only sex shop in the heart of downtown, and that’s what they would have to prove,” Bergthold said — adding that Romantix’s arguments Tuesday were a “bridge to nowhere.”

The city claims that, even though there was no specific guidance at the time on the use of a Romantix-like store, the company should have known it would be classified as an adult retail store, and thus, not allowed downtown.

The city maintained the denial was a logical decision based on the staff’s interpretation of retail sales and services at the time. When pressed on whether the court could offer any remedy if a legal error was found, Bergthold said state procedures might not allow for a retroactive fix.

The judges, however, weighed the city’s shifting definitions against existing precedent.

“[It says] a governing body’s failure to correctly interpret and apply controlling law constitutes arbitrary, capricious and unreasonable conduct,” U.S. Circuit Judge Raymond Gruender, a George W. Bush appointee, said.

Romantix’s argument hinges on this logic. If the city had correctly applied the ordinance as it existed years ago, the store says, the permit would have been granted — therefore opening the door for Romantix to own and operate the retail space regardless of the new ordinance.

The initial denial came after Romantix signed a seven-year lease and spent $400,000 on the new retail concept — prompting a lawsuit over damages caused by the city officials’ lack of agreement on key definitions in its zoning and land-use laws.

The lower court previously sided with Fargo, ruling that the city’s refusal did not violate the First Amendment. Chief U.S. District Judge Peter Welte found that, because Romantix intended to sell sexual devices rather than books, the store’s activity did not qualify as protected speech.

The Donald Trump appointee also rejected claims that the city’s ordinances were unconstitutionally vague — a notion outright opposed by Romantix Tuesday, who argued that “words matter.”

“At the time that Romantix sought and complied for their permit, the definition was just adult bookstore, not sexual device shops,” Romantix’s attorney, Matthew Hoffer, said. “That was the ordinance in effect at the time the application was submitted, that’s the ordinance that matters.”

Hoffer also noted the city only realized the problems with its ordinance — and only started to address it — after the lawsuit was filed.

Romantix claims the city had no objective, written standards for these permits, and instead denied a business simply out of a desire to keep that type of store out of the downtown area.

Still, the judges questioned what sort of relief the court could offer Romantix since the ordinance had already been updated, and made that concern clear while questioning Hoffer.

“You need to elect your remedy, or pick your argument here,” said U.S Circuit Judge Steven Colloton, another George W. Bush appointee.

Hoffer did refer to a potential “grandfather” provision in Fargo that would allow Romantix to operate the downtown location if the city erred in denying its initial application — but neither attorney could point to a specific provision.

U.S. Circuit Judge Jonathan Kobes, a Trump appointee, rounded out the three-judge appellate panel.