Shopping Centers and Free Speech

By Manuel Fishman, Real Estate Attorney, Buchalter Nemer: What are owners and operators of mixed-use properties to do when becoming targets of social groups that want to solicit donations or otherwise conduct expressive activity promoting some social cause?

By Manuel Fishman, Real Estate Attorney, Buchalter NemerFishman

Owners and operators of mixed-use properties, such as lifestyle centers and supermarket-anchored strip centers, are always a target for social groups that want to solicit donations or otherwise conduct expressive activity promoting some social cause.  The reason is simply – people congregate and visit these centers, and it is a place where people stay for a period of time and, therefore, may be receptive to being approached to engage in conversation about a variety of topics of social relevance.  What is an owner or operator to do to prevent such an activity from interfering with the goodwill and atmosphere it has spent money to create to encourage repeat customers and shopping?  A recent California case provides a good road map.

The Fig Garden Village shopping center is located in Fresno, Calif.  It is known as a lifestyle center with a mix of approximately 60 national and local retailers, restaurants and offices.  In 2013, representatives of “Nu Creation Outreach,” a non-profit organization that operates youth centers and food pantries, started solicitations at the shopping center.  The shopping center had a “no solicitation policy” and had a designated “public forum area.”  Nu Creation Outreach conducted its activities adjacent to various retailers in the shopping center – not in the designated public forum area.  When the shopping center owner called the police, the police refused to intervene without a court order.  The owner of the shopping center marched into court and the court issued an injunction preventing further solicitations.  Nu Creation Outlook appealed. Nu Creation argued that the areas near store entrances where the solicitations occurred were a “public forum” and that it was entitled to the protection of the California Constitution to exercise expressive activity relating to free speech, including gathering solicitations for social causes.

It is well settled that the liberty of free speech cannot be unreasonably abridged in shopping centers because when an owner advertises and takes steps to lure customers to take advantage of the amenities of the center, it creates the equivalent of a “public forum” and therefore must allow the exercise of free speech liberties, subject to reasonable regulations adopted to assure that the free speech activities do not interfere with normal business operations.  But that right is not unlimited.  The Fig Garden Village case offers a good roadmap for owners and operators to follow to be in a position to proactively stop unwanted activity.  First, designate a public forum area marked on a diagram of the shopping center and make it publicly available.  Second, develop support for the position that the sidewalks and apron areas in front of retailer’s stores are not designed in a way that induces shoppers to congregate for purposes of entertainment or relaxation, but are designed only to facilitate ingress and egress to stores.  The Fig Garden Valley case provides a good summary of the facts and exhibits an owner needs to develop.
Astute readers will wonder how the owner of the shopping center was able to obtain an injunction in the face of the requirement that an owner show “irreparable harm” to obtain the extraordinary remedy of an injunction.   The Court found support for finding the requisite harm in a declaration from the shopping center’s owner: “a shopping center’s success depends on customer goodwill and a desire to return to the same location out of habit and loyalty. The disruptive solicitation activity of Nu Creation solicitors harms the [shopping center’s] relationship with its tenants and customers and erodes customer goodwill.”

Fast forward to June 2015.  The Fresno Bee reported that the shopping center sold. “Rouse Properties, a New York-based owner and operator of enclosed regional malls and retail centers, announced that it has acquired Fig Garden Village for $106.1 million.”  Not a bad result.

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