San Francisco Mayor Dodges Suit Over Removal of ‘Racist’ Billboards

SAN FRANCISCO (CN) — San Francisco Mayor London Breed cannot be sued for allegedly pressuring advertising firms to pull a political rival’s billboards that were denounced as racist by the mayor and several other elected officials, a federal judge ruled Tuesday.

Failed mayoral candidate Ellen Zhou sued Mayor Breed and two billboard advertising firms — Clear Channel Outdoor LLC and OutFront Media — in November last year, after the companies took down two of her campaign billboards.

One of the mega-sized ads depicted Mayor Breed, who is black, reclining in a red dress with her feet propped up on a desk lined with stacks of cash and holding a wad of money in one hand and a cigar in the other. Another billboard showed Breed driving a red bus with the text “Werewolves of London Tours” near cars with smashed windows.

Breed told ABC7 News in October last year that the billboard featuring wads of cash was hurtful and disrespectful, adding that San Francisco is “no place” for “that kind of divisiveness.” Several elected officials, including Assemblyman David Chiu and Malia Cohen, a former San Francisco supervisor and now member of a state board that oversees taxes and fee collection, also condemned the ad as racist, sexist and offensive at a press conference this past October.

At the time, Zhou defended the billboards as calling attention to San Francisco’s homeless problem and a perceived misuse of taxpayer money. She said in a statement that Breed was playing the “race card” to “bully a small, immigrant Chinese woman.”

Zhou is a social worker and member of the National Rifle Association who also stirred controversy last year when she encouraged members of the Chinese community to start carrying guns amid a spate of crimes targeting older Chinese people.

Breed, a Democrat, easily won re-election last November with more than 125,000 San Franciscans, or 70.6%, voting for her. Zhou, a Republican in an extremely left-leaning city, came in a distant second with over 24,600 votes, or 13.9%.

Zhou argued in her lawsuit that Breed used her government position to “pressure and encourage” advertising firms to remove her billboards and suppress her speech.

In a 13-page ruling, U.S. District Judge William H. Orrick III rejected that theory. He cited a 1984 Third Circuit decision, R.C. Maxwell Co. v. New Hope, which found a town government’s letter urging a landlord to take down billboards was not coercive.

“The landlord’s ‘nebulous desire’ to stay in the town council’s good graces was not enough to give rise to a constitutional claim,” Orrick wrote.

Zhou failed to show Breed provided “such significant encouragement” that the billboard companies’ decisions to pull the ads were “effectively government decisions,” Orrick concluded.

“No one threatened legal action or any other negative ramifications to encourage removal of the billboards,” Orrick wrote.

The judge also refused to accept another theory — that the city’s power to regulate the companies and “substantial revenue” earned from business with the city provides another basis for pressuring them to do the government’s bidding.

Orrick said the Supreme Court made clear in several decisions, including the 1974 case Jackson v. Metro Edison Co., that regulation alone does not transform a private action into a state action.

“The generally applicable regulations that plaintiffs refer to are a far cry from allegations that could establish that the decisions to take down the billboards were effectively the state’s,” Orrick wrote.

He also dismissed Zhou’s breach of contract claim against Clear Channel because the company’s agreement with her clearly stated it could remove advertisements “for any reason or no reason at any time.”

Zhou’s attorneys had asked for permission to amend the complaint with a new claim — breach of the implied covenant of good faith and fair dealing. However, because the contract unambiguously gives Clear Channel the right to pull ads, Orrick found “doing so could not have been a breach.”

Orrick dismissed the lawsuit in its entirety with prejudice and ordered Zhou to pay Breed’s legal fees as required under California’s anti-SLAPP law. That statute aims to deter lawsuits that go after people for speech protected by the First Amendment. Orrick found Breed’s criticism of the billboards was a protected form of speech. He ordered Zhou to pay $22,200 for Breed’s legal fees.

Reached by email, San Francisco City Attorney’s Office spokesman John Coté said the city is happy with the ruling.

“This lawsuit was baseless from the start,” Coté said. “We’re pleased the court dismissed it.”

Neither Zhou’s campaign nor her attorneys, Steven Clifford Bailey of Ramona, California, and Robert Evan Williams of San Diego, returned emails requesting comment by press time.