At this weeks IBO Conference, Richard Rothfelder, Chris Rothfelder and Mike Falick had an engaging discussion about aspects of billboard law focused around their new book.  Here is an excerpt from that discussion as they consider some of the key legal issues facing the OOH industry.

Vested Rights and Local Preemption

When does a billboard operator’s permit application vest — and why does that matter?

Mike Falick: The general rule, at least in Texas, is that vesting occurs as soon as the application is filed. We’ve had situations where clients were told by bureaucrats at the permit window to hold off while they consulted someone internally — but the application had already been submitted. Then the government tries to impose a moratorium while they figure out whether to change their ordinance. Our advice is always to follow the current ordinance and get that application in, because the vested right attaches at filing.

What about state preemption of local billboard regulations?

Mike Falick: Where a state has passed a preemption statute, a local municipality cannot pass something more restrictive. We call it the ‘Death Star’ provision in some states. The limitation is that it’s often tied to specific components of state law rather than a blanket preemption. We’re pushing to expand its reach — arguing that if the state regulates this industry, municipalities shouldn’t be able to pile on. It’s an uphill argument in places that traditionally favor local control, but it’s gaining traction, and if one state fully adopts it, others may follow.

Administrative Law: The Regulatory Tide Is Turning

You’ve described administrative law developments as particularly significant for the industry. What’s changed?

Chris Rothfelder: What I’ve seen over the past decade is a clear trend toward more favorable treatment of private business owners and less deference to government agencies. The landmark example we go back to is a case called Gannon vs TxDOT, which we litigated in the Austin Court of Appeals in Texas about five years ago. The Texas Department of Transportation had issued an informal internal memorandum instructing its staff on how to process relocation permits — without going through the required statutory notice and rule making process. We challenged it as an invalid rule, and we won. The court held it was unenforceable because it hadn’t gone through the proper process. That same principle applies across the country: if an agency wants to regulate the outdoor advertising industry, it has to go through the full, robust rule making process — not just issue guidance memos to its own staff.

How has the erosion of the Chevron doctrine affected billboard operators?

Chris Rothfelder: Significantly. Chevron stood for the proposition that courts should defer to government agencies when those agencies interpret their own regulations. After recent Supreme Court decisions chipping away at that doctrine, the playing field is leveling. Take a height restriction of 60 feet — if it’s a close call because there’s an elevated roadway or a curve, the agency used to get the benefit of the doubt. Now everyone starts at the same place. The agency doesn’t automatically win a close interpretive question. Beyond that, if you’re being hit with a monetary penalty, you may now have the right to a jury trial rather than being forced before an administrative law judge. These are meaningful shifts.

Interested in learning more? You can purchase a copy of Rothfelder & Falick through this LINK on the Billboard Insider web site. 

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