The First Circuit Court of Appeals held that zoning bylaws restricting the size of adult-entertainment businesses, but not other businesses, was unconstitutional.
In 2008, the Town of Mendon, Massachusetts enacted a zoning bylaw that created an “Adult- Entertainment Overlay District,” to which adult-entertainment business were relegated. The Town’s stated purpose was to regulate the “secondary effects” caused by adult entertainment businesses, such as crime and traffic increases, public health concerns, and decreased property values. Shortly thereafter, the plaintiff, Showtime, applied to the Town for a license to operate an adult-entertainment business—peddling in live, nude dancers—within the Overlay District. The proposed construction would yield an 8,935-square-foot “Adirondack style” building that could accommodate 244 patrons and 25 employees, along with an 82-space parking lot.
Many Town residents objected, and a group of citizens petitioned the select board to enact additional zoning restrictions on adult-entertainment businesses. The Town residents subsequently voted to enact the following zoning amendments, applicable to adult-entertainment businesses only: (1) limit the facility to 2,000 square feet; (2) require the facility not to exceed 14 feet in height; and (3) prohibit the business from opening earlier than 4:30 p.m. on school days. In addition, the Town amended its bylaws: adult entertainment businesses were now prohibited from receiving licenses to serve alcohol.
After these significant changes, Showtime renewed its application. It revised its building plan to a structure that would meet the new size requirements, promised not to open before 4:30 p.m. and not to seek a liquor license, and presented a traffic study concluding the business’s effects on traffic would be minimal. This time, Showtime’s license was approved, but it was subject to numerous restrictions: signage, soundproofing, and even police patrol requirements. Displeased, Showtime filed suit in the federal district court in Massachusetts, claiming the Town was infringing on its First Amendment rights and challenging the zoning bylaws. The district court granted summary judgment for the Town, finding that the Town’s restrictions were valid, content-neutral regulations targeted at combating the secondary effects produced by adult-entertainment businesses.
On appeal, the First Circuit Court of Appeals reversed, holding that the zoning bylaws unconstitutionally infringed on Showtime’s First Amendment rights.
First, the Court recognized that, although adult entertainment is expression protected under the First Amendment, it is permissible to enact zoning regulations to curb the “secondary effects” likely to be caused by an adult-entertainment business. However, despite the Town’s stated content-neutral purposes here—preserving the “rural aesthetic” of the Town and preventing increased traffic—the Court was skeptical that these regulations were truly content-neutral. Ultimately, the Court determined that because the regulations could not withstand intermediate scrutiny—the “test” for content-neutral regulations—it did not need to decide whether these zoning bylaws were content-neutral or content-based.
Second, the Court described the doctrine of “underinclusiveness.” Under this doctrine, even where an ordinance purports to be content-neutral and to regulate only the secondary effects of protected speech, if other businesses, not subject to the ordinance, also produce the same secondary effects, the ordinance must be revealed for what it really is: a restriction targeted directly at the content of the expression created by an adult-entertainment businesses. In other words, if both adult-entertainment and other businesses produce the same secondary effects, it is unconstitutional to regulate only the adult-entertainment businesses, and any such ordinance that does so is impermissibly “underinclusive” and does not further a substantial governmental interest.
The Court determined that the Town’s zoning bylaws here were underinclusive because other businesses in the Town, not just Showtime’s adult-entertainment business, were just as likely to produce the secondary effects the Town claimed it sought to target: a breakdown of rural aesthetics and increased traffic. Other commercial buildings in the Overlay District exceeded the new size requirements for adult-entertainment businesses and therefore had just as much effect on the rural nature of the Town. Furthermore, there was nothing to show that an adult-entertainment business would create more traffic concerns than the existence of any other business. The Court determined, instead, that it was not the size of the building, but what went on inside the building, that the Town was concerned with. Therefore, because the Town could not show why adult-entertainment businesses should be regulated differently than other businesses, the ordinance was underinclusive, did not advance a substantial governmental interest, and was unconstitutional. 
 The plaintiff also challenged a regulation banning the sale of liquor at adult-entertainment businesses under the Massachusetts Constitution. The Circuit Court of Appeals certified that question to the Massachusetts Supreme Judicial Court for resolution.