Jacksonville food truck ruling is good news for economic liberty

Most of us are likely to see little direct impact from a recent court ruling favoring three business owners in Jacksonville. But the decision should please any North Carolinian who favors economic liberty.

A unanimous three-judge state Court of Appeals panel ruled on Dec. 3 that plaintiffs in Proctor v. City of Jacksonville could continue to challenge city food truck rules. The panel overturned a trial judge’s decision to dismiss the entire case.

Plaintiff Nicole Gonzalez owns business property in Jacksonville. She would like to host food trucks owned by fellow plaintiffs Anthony Proctor and Octavius Raymond. Jacksonville’s food truck rules prevent those voluntary transactions.

“Plaintiffs argue the trial court erred by granting Defendants’ motion because it applied the wrong legal test to their claims and, even assuming the trial court had applied the correct legal tests, their complaint adequately alleged facts sufficient to survive dismissal,” wrote Judge Jefferson Griffin. “We agree with both of Plaintiffs’ arguments and reverse the trial court’s order dismissing Plaintiffs’ claims.”

The three plaintiffs have been working with the Institute for Justice. They filed suit in December 2022 against multiple aspects of Jacksonville’s food truck rules.

“Plaintiffs allege the location restrictions prevent food truck operators from conducting business in approximately ninety-six percent of property located in Jacksonville. Because of these restrictions, Plaintiffs contend their rights to engage in safe and lawful occupations are severely infringed,” Griffin wrote.

Along with location restrictions, the suit challenged limits on food truck signs. IJ’s plaintiffs allege that sign restrictions violate free-speech rights.

“Article 1, section 14 of the North Carolina Constitution provides that ‘[f]reedom of speech and of the press are two of the great bulwarks of liberty and therefore shall never be restrained, but every person shall be held responsible for their abuse,’” Griffin wrote.

“This provision requires State action regulating commercial speech to satisfy either strict scrutiny or intermediate scrutiny depending on whether the regulation is content-based or content-neutral, respectively,” Griffin added. “We hold the trial court erred by applying the wrong legal test to their freedom of speech claim.”

The lawsuit emphasized that Jacksonville’s unified development ordinance treated food truck owners differently from competitors.

“Another consequence of the UDO’s classifications is that ‘[a] specialty-eating establishment like a bakery, a coffee shop, or an ice cream shop could open on Eligible Property next door to a restaurant, residential property, or a food truck …, but a food truck offering the very same baked goods, coffee, or ice cream could not,’” Griffin explained.

The lawsuit “contains numerous other factual allegations explaining how the UDO’s classifications allow for businesses engaged in substantially the same business as Plaintiffs, namely selling food and drink, to set up shop in areas that food trucks may not,” Griffin wrote.

The Appeals Court allowed plaintiffs to pursue claims that Jacksonville’s rules violate rights guaranteed by the state constitution’s “fruits of their own labor” and “law of the land” clauses.

Both “protect citizens’ constitutional right to earn a living from arbitrary regulations,” Griffin explained. “Here, Plaintiffs allege the City and its officials enacted the UDO, and the challenged provisions therein, ‘to protect brick-and-mortar restaurants from competition.’”

IJ argued that an earlier draft of Jacksonville’s food truck rules would have allowed entrepreneurs to “operate within a larger area of Jacksonville,” Griffin wrote. “However, the UDO was redrafted because ‘in the restaurant owners’ view, the original overlay map did not sufficiently insulate them from competition.’”

Under pressure from restaurant owners, Jacksonville adopted final rules that blocked food trucks from operating within 250 feet of a property with a restaurant. Trucks can’t operate within 250 feet of a property with another food truck or within 250 feet of residential property.

“[T]aking Plaintiffs’ allegations as true, we hold they sufficiently pled an unlawful and improper governmental purpose for the UDO,” Griffin wrote.

Even Jacksonville’s food truck fees will face further review.

The lawsuit claims fees were not based on “actual or reasonably anticipated costs” of enforcing the regulations, Griffin wrote. “While cognizant that the UDO enjoys a presumption of validity, we nonetheless hold the trial court erred by applying an erroneous blanket-test to Plaintiffs’ claims.”

Gonzalez, Proctor, and Raymond have yet to win their case. They still must prove that Jacksonville’s rules violated their free speech, equal treatment, and economic liberty rights.

Yet the state Appeals Court has signaled that Jacksonville faces a substantial obligation to justify its food truck restrictions. Other North Carolina cities considering limits on their residents’ right to earn a living ought to take notice.

Mitch Kokai is senior political analyst for the John Locke Foundation.