In the March 2005 case, Judge John Jelderks had ruled for the city, saying Oregon Entertainment Corp. failed to make a strong case that its constitutional rights had been violated when the city refused to allow the store 24-hour operation.
Attorneys for both sides argued the case before the appeals court March 7 in Portland, with Oregon Entertainment attorneys' main argument being that the city’s denial amounted to “prior restraint,” because of the adult material the store sold and rented. Such a practice would be improper under Oregon’s Constitution, which protects speech and legal activity some might consider “unsavory.”
The company also claimed that it was denied due-process rights under the 14th Amendment because its lawyers were not allowed to cross-examine witnesses before the Beaverton City Council during a hearing in the case. Company attorneys said the city’s denial blocked its use of the property without the proper legal process.
Attorneys representing the city of Beaverton disputed that claim, and also said that the city’s permit process includes “the exercise of substantial discretion” and shouldn’t be based solely on fulfillment of regulatory criteria.
In a three-page decision, the appeals court agreed with the city and affirmed the U.S. District Court decision.
The 9th Circuit Court of Appeals is one of the last stops in the legal case before going to the U.S. Supreme Court.