Phoenix Sex Club Owner Strikes Out on Privacy Appeal

The U.S. Court of Appeals for the 9^th Circuit has rejected an attempt by the corporate owner of a gay sex club in Phoenix, Arizona, to assert the privacy rights of its patrons in an effort to invalidate a city law that may be used to shut down the club. Ruling on December 22 in Fleck and Associates v. Phoenix, 2006 WL 3755201, court held that corporations do not themselves have privacy rights, and that the club cannot bring suit to vindicate the privacy rights of its "members."

In 1998, Phoenix enacted an ordinance banning "live sex act businesses," which it defined as those "in which one or more persons may view, or may participate in, a live sex act for a consideration." This presents a problem for Fleck & Associates, a corporation that owns Flex, described by Judge Dorothy Nelson in the court’s opinion as "a gay men’s social club" in Phoenix that "limits access to adults who have purchased ‘memberships’ on a yearly, semi-yearly, or daily basis."

"Many people enter the club by purchasing daily passes," wrote Nelson. "Customers can rent private dressing rooms for an additional fee. Sexual activities take place in the dressing rooms and in other areas of the club."

In January 2004, city police officers entered the club, searched the office, questioned some employees and detained them overnight. Fleck claims to have been threatened with similar actions by the police. In June 2004, Fleck filed its lawsuit, seeking a declaration from the federal district court that the city ordinance, cited by the police, is unconstitutional.

Fleck based his claim on Lawrence v. Texas, 539 U.S. 558 (2003), which struck down a Texas statute making gay sex a crime. The Supreme Court ruled that gay people have a right to engage in consensual sex protected as a liberty interest under the Due Process Clause of the 14^th Amendment of the Constitution.

District Judge David G. Campbell found that Fleck, as a corporation, did not have any standing to claim a right of privacy, as this is a right that is only conferred upon individuals. Fleck also sought to protect the privacy rights of its members, but Judge Campbell held that it could not do so. Despite this ruling on standing, Campbell went on to opine that "the privacy rights of Fleck’s members do not exist in Fleck’s public social club." Fleck appealed.

The appeals court agreed with Campbell’s ruling that the corporation enjoys no privacy rights. Nelson wrote that "a corporation is not entitled to ‘purely personal guarantees’ – those rights that have historically been granted to individuals. An analysis of the ‘nature, history, and purpose’ of the constitutional guarantee at issue demonstrates that it is ‘purely personal’ and therefore incapable of being claimed by a corporation." Nelson pointed out that the Lawrence decision, upon which Fleck relied, specifically held that the due process clause requires "respect for the petitioners’ private lives such that the State cannot demean their existence or control their destiny by making their private sexual conduct a crime."

The court also agreed with Campbell that Fleck could not assert the privacy rights of the members of the Flex social club. Wrote Nelson, "Fleck claims that the ‘inherently personal right of homosexual sexual activity is central to the function and operation of its facility,’ and that this somehow means Fleck has a liberty interest protected by the due process clause to run a ‘facility devoted to providing a safe location for homosexuals to express their sexuality.’ Essentially Fleck argues that it has a right to facilitate the exercise of the admittedly personal ‘right of homosexual sexual activity.’"

This claim, however, failed because the court refused to recognize that those who purchased "memberships" in Flex were actually members of a representative organization for purposes of federal court standing. They were just "customers," according to Nelson, whose "membership" did not constitute an expressive association for which standing may be recognized. The ACLU or the National Rifle Association, for example, are entitled to sue on behalf of their members to vindicate the right of free speech or the right to bear arms, but Fleck, a commercial enterprise, is not entitled to sue on behalf of its members’ interests in having a safe place to interact with sexual partners.

However, the court did disagree with Judge Campbell on one point. Having found that Fleck did not have standing to assert its customers’ privacy rights, the court concluded that Campbell lacked jurisdiction to rule on the merits of the customers’ claims to privacy in Fleck’s establishment. Because nobody with standing to sue had placed that right in question before him, Judge Campbell should have dismissed the claim for lack of subject matter jurisdiction rather than ruling upon it.

After all, the real parties in interest were not represented in court. If, in a subsequent police raid, individual members were arrested for having sex in Flex, they should be able to assert their personal privacy rights in subsequent litigation to contest their arrests.