The Myth Of Secondary Effects
by Mark Kernes, Senior Editor, AVN

Ever since the U.S. Supreme Court's decision in Renton v. Playtime Theatres, Inc., 475 U.S. 41 (1986), municipalities across America have been given the power to limit the number of adult businesses in a community, as well as to severely regulate their location, hours of operation, floor space devoted to adult materials and several other ordinary business decisions, based on the "secondary effects" which adult businesses are alleged to have on the community around them.

Among the "secondary effects" which adult businesses - bookstores, video stores, cabarets and even Internet servers - are reputed to have are a decrease in property values, an increase in crime and, in some cases, an adverse effect on community health in and around the businesses' locations.

Moreover, the Renton decision allows a municipality to use not only whatever experience it may have with its own adult businesses, but also - or exclusively - studies done of the experiences other communities claim to have had with their adult businesses.

Recent studies by social psychologists, however, have raised serious questions about the accuracy of the studies most frequently employed in this process, and contemporary court decisions in some major metropolitan areas have challenged cities' ability to use such studies in formulating their zoning regulations and licensing requirements.

Although problems with the most-used "secondary effects" studies have been the subject of articles in professional journals for a number of years, the first far-reaching, in-depth analysis of those studies was first undertaken by Dr. Daniel Linz, a social psychologist at the University of California's Santa Barbara campus, and attached to the amicus curiae brief filed by the First Amendment Lawyers Association in the appeal to the U.S. Supreme Court of the City of Erie v. Pap's A.M. nude dancing case, which was decided in March of last year.

In his opinion in Pap's, Justice Souter registered his concern about the unquestioning acceptance of secondary effects studies without allowing plaintiff adult businesses to challenge the studies' merits. Justice Souter wrote, "I do not believe, however, that the current record allows us to say that the city has made a sufficient evidentiary showing to sustain its regulation, and I would therefore vacate the decision of the Pennsylvania Supreme Court and remand the case for further proceedings."

Since municipalities across the country have relied almost exclusively on a set of ten "secondary effects studies" done mainly in the late 1970s and early '80s, in such diverse locations as Phoenix, AZ, Indianapolis, IN, St. Paul MN and Los Angeles, CA, Dr. Linz was concerned with the methodological rigor of the studies; that is, how well what was done adhered to sceintific principles of statistical sampling. Because unless the studies were performed according to the scientific method established by the social scientists who engage in that sort of research, and who peer-review such work in scientific journals, the trustworthiness of the studies, and their use in forming public policy, would (and should) be called into question.

Dr. Linz used the Supreme Court's criteria as set forth in Daubert v. Merrell Dow, 509 U.S. 579 (1993) to distinguish whether the studies under consideration were valid or "junk science," as author Peter Huber refered to it.

"That the Frye test was displaced by the Rules of Evidence does not mean, however, that the Rules themselves place no limits on the admissibility of purportedly scientific evidence," wrote Justice Harry A. Blackmun for the Daubert Court. "Nor is the trial judge disabled from screening such evidence. To the contrary, under the Rules the trial judge must ensure that any and all scientific testimony or evidence admitted is not only relevant, but reliable."

The Daubert standard requires that "The subject of an expert's testimony must be 'scientific... knowledge,' and defines "scientific" as being "ground[ed] in the methods and procedures of science," and "knowledge" as "connot[ing] more than subjective belief or unsupported speculation." Justice Blackmun also wrote that "in order to qualify as 'scientific knowledge,' an inference or assertion must be derived by the scientific method. Proposed testimony must be supported by appropriate validation - i.e., 'good grounds,' based on what is known. In short, the requirement that an expert's testimony pertain to 'scientific knowledge' establishes a standard of evidentiary reliability."

In addition, the Daubert standard requires that in the process of making sure the "expert testimony" under consideration is based on scientific knowledge and is relevant to the issue(s) under consideration, the trial court must make "a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and of whether that reasoning or methodology properly can be applied to the facts in issue." This requirement is central to Dr. Linz's finding that the most commonly-used secondary effects studies are fraught with error.

Among the factors the Supreme Court set forth in Daubert to determine scientific validity were "testing [hypotheses] to see if they can be falsified"; "whether the theory or technique has been subjected to peer review and publication," (which the Court did not consider a requirement, but described as "'good science,' in part because it increases the likelihood that substantive flaws in methodology will be detected"); and "consider[ation of] the known or potential rate of error." The Court downplayed "general acceptance" of a particular theory by the scientific community, noting that it can be "can be an important factor in ruling particular evidence admissible," but that "'a known technique that has been able to attract only minimal support within the [scientific] community' ... may properly be viewed with skepticism... The focus, of course, must be solely on principles and methodology, not on the conclusions that they generate."

Among the problems that Dr. Linz found with the studies under consideration were that, usually, the "study areas" around adult businesses were not matched with similar "control areas" for such variables as crime rate, socio-economic conditions such as ethnicity, single-parent homes, and presence of alcohol-serving establishments; that the crimes being looked at in both the study areas and the control areas were not necessarily the same offenses, reported in the same manners (for instance, actual police reports versus 911 calls); and that increased surveillance by police of the adult businesses' neighborhoods versus the control areas was not taken into account. Dr. Linz also derided the scientific validity of simply taking surveys of the adult businesses' neighbors and other citizens as to what they thought the effects of the businesses were.

Without delving too deeply into Dr. Linz's results here - his amicus study is available from the Free Speech Coalition - Dr. Linz found substantial flaws in the methodology of nine of the ten studies he considered - and also found that the tenth study, the one conducted in St. Paul, though more scientifically rigorous than the rest, showed no negative adverse effects of adult businesses on the community.

Dr. Linz's findings were recently borne out in the case of Flanigan's Enterprises, Inc. v. Fulton County, Georgia, No. 00-11152 of the 11th Circuit U.S. Court of Appeals.

In the Flanigan's case, Fulton County wanted to ban the serving of alcoholic beverages in nightclubs featuring nude dancing, and commissioned studies by local police and a company called Land Development Analysts (LDA) to determine if there was an increased incidence of crime around the clubs, and whether the clubs had any effects on the property values of the surrounding neighborhoods.

To quote from the Appeals Court decision: "The [police] study concluded that, for the time period January 1, 1995 through May 31, 1997, there was no statistical correlation showing an increase in crime at adult entertainment establishments that served alcoholic beverages. Rather, the statistics indicated greater instances of calls for service and reported crime at non-adult entertainment establishments that served alcoholic beverages... The [LDA] study revealed high occupancies and rental rates in existing buildings, expensive improvements, business expansions, turn-away business volume and proposed development in the Clubs' vicinities."

Or as one club's attorney recently put it, "You ought to be sending all your neighbors to the tax assessor's office every time the tax assessment goes up in your area, and you say, 'You know what? Here's all these cases about secondary effects, and we're right next to an adult business, so our property values must be going down, you know, 300 percent.' And the tax assessor is going to say, 'No, no, no, no, no; we track all this, and the property values go up.' And then you have evidence when you go into a court, and you say, 'Look, we tried to get people to have their property values reduced and their tax assessment reduced. Doesn't happen.' We have an adult bookstore in Seattle, Washington that's connected to one of the Deja Vu clubs; their tax assessment last year went up 100 percent. Absolutely doubled. And if that doesn't refute the idea that adult businesses cause a reduction in property values, I don't know what does."

However, since its own studies didn't come up with the results Fulton County officials had expected, the county decided to ignore its own studies and rely instead, as so many municipalities had, on the "secondary effects" studies from L.A., San Antonio, and other cities.

Here's what the 11th Circuit thought of Fulton County's action:

"In other words, local studies commissioned both by the Clubs and the Board found no evidence of the secondary effects with which the Board was purportedly concerned. The question thus becomes, was it reasonable for Defendants to ignore relevant local studies and rely instead upon remote foreign studies in determining whether adverse secondary effects were attributable to the Fulton County Clubs?

"We do not think that Defendants had any reasonable justification for amending Section 18-76 when the county's own studies negated the very interests it purportedly sought to prevent... Accordingly, we find that it was unreasonable for Defendants to rely on remote, foreign studies concerning secondary effects when the county's own current, empirical data conclusively demonstrated that such studies were not relevant to local conditions."

The Fulton County case addresses what happened when a municipality's own studies contradict the preconceptions of its legislators, but of equal interest is the case of XLP Corporation v. County of Lake, from the Appellate Court of Illinois, Second District, No. 2-99-0788. In that case, the plaintiff adult businesses, which had been in operation in the County for as long as 15 years, had challenged various provisions of an adult use ordinance which had been enacted, the County said, after it "had relied on studies conducted by other municipalities regarding adverse impacts associated with adult uses," as the U.S. Supreme Court had allowed it to do under the Renton decision. The Plaintiffs argued that the County could not demonstrate, over the 15 year history of the businesses operating in the County, that any of the adverse secondary effects alleged in the studies upon which the County relied were real. After a motion for summary judgment by Defendants, the trial judge issued a ruling for the Defendants, which Plaintiffs appealed.

The Appellate Court agreed, remanding the case for a full evidentiary hearing, stating:

"Defendant relies on Renton to maintain that a legislative body does not have to wait until a problem occurs before enacting an adult use ordinance. However, this conclusion by the Renton Court has to be considered in the context of that case. In Renton, there were no adult businesses in existence at the time the city enacted its ordinance. Consequently, the Supreme Court determined that the City of Renton could rely on the experiences of other communities, in particular those of Seattle, which had conducted detailed studies of adult use businesses, to adopt its ordinance. Here, however, where plaintiffs had been in business for 15 years at the time defendant enacted its ordinance, plaintiffs' allegation that defendant wrongly relied on outside studies instead of considering plaintiffs' existing businesses to determine whether such businesses cause adverse secondary effects presented an issue of fact...

"The reasonable inference to be drawn from the allegations set forth in plaintiffs' counts I and II, pertaining to defendant's justification in enacting the ordinance, is that defendant could not prove that the adverse secondary effects recited in the ordinance's preamble were real. In other words, defendant could not demonstrate that the ordinance advanced a substantial governmental interest, especially as applied to plaintiffs, whose businesses had operated for 15 years in the county without causing any adverse secondary effects."

Both Fulton County and XLP Corporation are important decisions for the adult entertainment industry because they show that courts are beginning to question the accepted "wisdom" of secondary effects studies which have been shown to be faulty and unscientific, and are willing to listen to challenges to the use of those studies when historical evidence of the actual harmlessness of adult businesses to the community exists.

California's own use of secondary effects studies will come under review this fall, when the U.S. Supreme Court hears City of Los Angeles v. Alameda Books, which involves the question of whether two adult uses under one roof - for instance, a bookstore and an arcade - cause greater "adverse secondary effects" than one use.

But whatever that court decides, the fact that, for years, the judicial system has allowed adult businesses' First Amendment rights to be thwarted through the courts' acceptance of unreliable claims of harm caused by the adult businesses, is coming to an end - and America will be a better place because of it.