Hustler Hollywood’s plans to develop a boutique to sell merchandise and materials carrying the adult magazine’s brand are back on track after a settlement of the company’s federal civil rights lawsuit against the city of Fresno.

The city agreed to pay $15,000 to Hustler Hollywood for the company’s attorney fees.

The two sides reached the settlement in U.S. District Court on the company’s plans to open the store in the former Silver Dollar Hofbrau building on Shaw Avenue just east of Highway 41. The building has been empty since January 2015.

Hustler Hollywood filed its lawsuit in February with the U.S. District Court in Fresno, alleging that changes to the city’s development code in December 2015 “targeted (Hustler’s) proposed First Amendment protected business by taking actions specifically designed to preclude (Hustler) from opening and operating its desired establishment.”

Attorneys from both sides sought approval from U.S. District Magistrate Judge Stanley Boone to hold a fast-tracked settlement conference even before the city filed a formal reply to the lawsuit. The sides reached a settlement in late March, and the Fresno City Council agreed to the terms in an April 6 closed session.

“Both parties felt that this was the best resolution to the dispute, so we agreed to settle,” Fresno City Attorney Doug Sloan said.

The settlement calls for the city to approve up to 1,000 square feet of floor space in the building “for the display and sale of adult material.” The transcript of the settlement conference includes a provision that there will be wall separating the adult materials from the rest of the sales floor, “as per the design drawings submitted to the city” in August 2016.

Both parties felt that this was the best resolution to the dispute, so we agreed to settle.

Fresno City Attorney Doug Sloan

The Bee reported almost a year ago that Hustler Hollywood planned to open the store to sell lingerie, Hustler-branded merchandise like T-shirts and hats, and sex toys. The city objected, declaring its development code did not allow “an adult oriented business” in the commercial general zoning district in which the building resides.

The company operates 24 stores nationwide, including one in Bakersfield and five others in California.

Hustler’s lawsuit accused the city of effectively changing the rules for “adult bookstores” and “adult novelty stores” in December 2015, after Fresno’s development department offered guidance to the company’s representatives based on the old rules that defined an “adult novelty store” as one in which 25 percent or more of display area was for “devices, instruments or paraphernalia evidently designed or marketed for sexual stimulation of human genital organs or for sadomasochistic use or abuse of themselves or others.”

Based on that guidance, the company “analyzed the amount of allowable floor space” in the 5,576-square-foot building “and determined that it could easily operate its proposed business at the premises below the threshold for triggering designation as an Adult Novelty Store,” the lawsuit states.

But a day after the Development Department provided its guidance to Hustler, the city adopted changes to the code that reduced the allowable space for adult materials to trigger regulation as an “adult” bookstore to the lesser of 25 percent or 500 square feet. Unaware of what Hustler attorney Paul Cambria dubbed a “stealth amendment” to the development code, Hustler Hollywood inked a 10-year lease for the Silver Dollar property in April 2016.

The suit alleges that the city’s denial of Hustler Hollywood’s zone clearance application in August, and subsequent inaction on a second application, “systematically squelched” the company’s First Amendment rights.

“It is well settled that ‘an ordinance which … makes the peaceful enjoyment of freedoms which the constitution guarantees contingent upon the uncontrolled will of an official – as by requiring a permit or license which may be granted or withheld in the discretion of such official – is an unconstitutional censorship or prior restraint upon the enjoyment of those freedoms,’ ” Hustler’s attorneys argued.

The suit also alleged that the city’s failure to issue the appropriate permits for the business violated the company’s equal-protection rights under the 14th Amendment.

Tim Sheehan