The Court of Appeals of Oregon has affirmed an award of $405,000 against a North Portland bar and the bar’s owner, Chris Penner, for violating state public accommodations law by denying “equal accommodations” to an informal social club that included gay and transgender people.
The September 23 ruling, which upheld a finding by the Oregon Bureau of Labor and Industries, rejected the owner’s outlandish argument that the bar hadn’t discriminated and its conduct was protected on First Amendment freedom of speech grounds.
Rose City T-Girls, a group whose diverse membership includes lesbians, gay men, transvestites, transgender people, and cisgender straights, meets in Portland bars on Friday evenings, and for a time was gathering at Penner’s P Club in North Portland. In June 2012, Penner left a voicemail for one of the club’s regulars asking that they not come to his bar, explaining, “Um, I really don’t like having to do that but unfortunately it’s the area we’re in and it’s hurting business a lot.”
Owner’s First Amendment free speech claim rejected by Oregon appellate court
When the club member left a return message asking for the “real reason” behind his request, Penner left a second message saying while one of his North Portland bars was doing well, Friday evening business at P Club was falling off. “I’ve done some investigating as to why my sales are declining and there’s two things I keep hearing: People think that (a) we’re a tranny bar or (b) that we’re a gay bar. We are neither,” Penner said in the message. “People are not coming in because they just don’t want to be there on a Friday night now… It’s all about money.”
Cassandra Lynn, the recipient of the messages, transcribed them for the rest of the Rose City T-Girls, who decided not to return to P Bar. Instead, they filed complaints with Bureau of Labor and Industries, which enforces the state’s public accommodations law. BOLI found a violation of the law and assessed damages of $50,000 for each complainant and $5,000 in penalties against the bar and Penner.
On appeal, Penner’s counsel argued that the law had not been violated, since none of the complainants went to the bar after the owner’s messages were received so nobody had actually been turned away or denied services. The attorneys argued that if the entire case turned on the phone messages, then it was an unconstitutional penalty for speech.
The Court of Appeals found these arguments totally lacking in merit, agreeing with BOLI that the phone messages constituted “an actual denial of service.” “Through the voicemails, Penner was not just stating his opinion, but was actually informing the T-Girls that they would not be served if they came to the P Club on Friday nights,” wrote Judge Douglas L. Tookey for the court. The club and its owner were not being held liable for their speech, itself, but for the “forbidden effect” of the speech, a denial of services by a public accommodation.
Penner’s assertion he was justified in his position due to a fall off in business was also rejected. Such a defense has been held invalid in public accommodations cases dating back to the 1960s when the federal civil rights laws prohibited places of public accommodation from discriminating on racial grounds. If an owner could justify denying service to a class of people because other people would stop patronizing the business, laws banning public accommodations discrimination would be toothless, at best.
A September 23 story in the Oregonian reported that once the judgment against Penner was finalized, his bank accounts were seized to satisfy the penalty, he laid off five employees, and the Twilight Room Annex — the new name he gave P Club after adverse publicity about this case — closed.
