Settlement in AATA Ad Lawsuit: No Costs

A settlement has now been reached in a lawsuit over the placing of an anti-Israel advertisement on Ann Arbor buses. The court’s July 17, 2013 settlement order states that the parties have agreed that the case will be “dismissed with prejudice and without costs or fees.” [.pdf of July 17, 2013 settlement order]

AATA Bus. Advertisements appear on the sides of buses. (Photo illustration by The Chronicle – which consists of applying a graphics filter and digitally adding the word “settlement” to an image that included the original text “out of service.”)

In an email responding to an inquiry from The Chronicle, American Civil Liberties Union attorney Dan Korobkin, who represented plaintiff Blaine Coleman in the case against the Ann Arbor Transportation Authority, stated: “After the court ruled that AATA’s advertising policy was unconstitutional, AATA made significant changes to its policy based on the ruling and current case law. Both sides decided that a settlement was appropriate, and we ultimately reached an agreement that worked for everyone.”

Korobkin added: “I am able to say that Mr. Coleman did not ask for any payment as part of the settlement, and that the ACLU accepted payment for some of its expenses and attorneys’ fees.”

In 2011, the Ann Arbor Transportation Authority had refused to place the ad on its buses as a part of its advertising program. The proposed ad reads “Boycott ‘Israel’” and “Boycott Apartheid” and features an image of a spider-like creature with a skull for a head. [.pdf of image and text of proposed ad]

According to AATA controller Phil Webb, the AATA is currently projecting that its net revenue from the advertising program – which is managed under a contract with CBS Outdoor Advertising – will come to about $276,000 for the fiscal year. This is the first year of the contract with CBS Outdoor. Compared with the previous contractor, CBS is generating about 2.5 times as much revenue to the AATA. [.pdf of billings through May 2013]

The lawsuit was filed by Coleman – an Ann Arbor resident who was represented by the ACLU – over a year and a half ago, on Nov. 28, 2011.

The case had remained in the preliminary injunction phase and had not yet proceeded to trial. Before the settlement, the most recent court action had come in early June, after a four-month pause in activity. In his June 4, 2013 ruling, federal judge Mark Goldsmith did not agree with the ACLU’s argument that the preliminary injunctive relief to which Coleman was entitled should take the form of placing the ad on AATA buses.

On the general motion for a preliminary injunction made by the ACLU, Goldsmith had earlier ruled in the case that the AATA’s policy – under which the advertisement had originally been rejected – was in fact unconstitutional. In light of that ruling, the AATA then changed its advertising policy to remove a “good taste” requirement and to add a clear prohibition against political ads in general, not just those for political candidates.

The AATA then reconsidered the original ad under its revised policy. Under this new policy, which the court has found to be constitutional, the AATA rejected the ad again.

Goldsmith then entertained arguments from both sides on the question: Should further preliminary injunctive relief be granted, beyond AATA’s revision of its advertising policy and the ad’s reconsideration and rejection? The ACLU argued that it would be appropriate to grant injunctive relief by forcing the AATA to place the ad on its buses. The AATA argued that this kind of relief was not justified. And four months after the last briefs were submitted on that question, Goldsmith ruled that the ACLU had not met the criteria for injunctive relief in that form.

But in Goldsmith’s June 4 ruling, he laid out the importance of establishing a clear argument on “viewpoint discrimination” – which he felt that the ACLU had not adequately developed within the frame of its request for preliminary injunctive relief. The ruling seemed to indicate a willingness on Goldsmith’s part to entertain further arguments along the specific lines of “viewpoint discrimination” – if the case had gone to trial.

The ACLU could have proceeded to trial, where one result could have been that the AATA was forced to place the ad or that the case was adjudicated in favor of the AATA. Or the ACLU could have immediately appealed the June ruling on the injunctive relief. After a June 17 status conference between the parties, another status conference was scheduled for June 27. In the interim, however, the AATA board met on June 20 in closed session about the case. And on June 21, at the request of the parties, the case was referred to magistrate judge Mark A. Randon for settlement. A settlement conference took place on June 26.

But the parties did not reach an immediate settlement and the court forged ahead by setting a schedule for a trial. [.pdf of June 28, 2013 scheduling order] The settlement on July 17 came nine days before disclosures were scheduled to be served on opposing counsel as a part of the trial schedule.

In the key earlier ruling in the case, on Sept. 28, 2012, Goldsmith had found the AATA’s advertising policy – in effect at the time when Coleman’s proposed ad had originally been denied – to be unconstitutional. Goldsmith had determined that the ad had been denied on both the “good taste” provision and the “scorn and ridicule” provision of the AATA’s advertising policy. The “good taste” provision itself was ruled unconstitutional. That provision was eliminated from the AATA’s revised advertising policy.

Based on Goldsmith’s June 4 ruling, a main issue at trial – if it had proceeded– would have been whether the AATA applied the “scorn and ridicule” provision in a way that was constitutional.

The AATA would have likely contended that its application of that “scorn and ridicule” provision was constitutional, setting up the argument: Coleman was not damaged by having his ad denied for an unconstitutional reason (“good taste”) – because there was some other, constitutional reason for denying the ad. So the ACLU would have likely made an effort to establish that the denial of the ad was based on an application of the AATA’s “scorn and ridicule” provision that included viewpoint discrimination, and was thus also not constitutional.

However, the settlement reached on July 17, 2013 means none of those arguments will be necessary.

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