Two Louisville, Kentucky, food truck owners have joined with the Institute for Justice to challenge a city ordinance prohibiting food trucks from operating within 150 feet of a brick and mortar restaurant selling similar food. The law has been used to harass food truck entrepreneurs and force them out of high-traffic areas.
The plaintiffs are seeking a permanent injunction on the 150-foot ban and $1 in damages.
Under the law, food truck owners can operate close to a restaurant only if the truck gets written permission from their brick-and-mortar competition. Restaurant owners can revoke permission at any time. As a result of the ordinance, much of the city is marked with "no food trucks" signs, making it difficult for vendors to find a profitable location.
Penalties for noncompliance include fines, loss of license to operate, and 30 days in jail. The ordinance can even be enforced on private property.
Brandon Coan, who worked as a policy adviser for Louisville-Jefferson County Metro Government at the time, crafted the law in 2011 and responded to the suit by claiming that he is willing to take another look at the ordinance. He argues it was necessary at the time: "We created the food truck law in the first place because it needed to be created. There wasn't anything that governed it, and as we see in other things like Airbnb and Uber and Lyft and the sharing economy, new evolutions in business come around, and part of the city's job is to come up with rules so we can have those things in our city."
According to plaintiffs, Troy King owner of Pollo and Robert Martin owner of Red's Comfort Food, this "necessary" law has been far from reasonable. Martin was ticketed in front of customers for violating the 150-foot rule. When he tried to explain that his food was different from what was served in nearby restaurants, he was told that a common food item, bread, was cause for the ticket. Martin no longer risks operating downtown, fearing he could lose his license: "I would like to continue downtown because it affords a living for me and my employees. I got to the point I had to say something. I feel like this city is about nepotism, cronyism and favoritism."
King has run into similar problems, city inspectors have threatened to tow his truck because he was operating too close to a cafeteria-style restaurant serving chicken: "At that time, I knew it was total bullying action." Even though King measured and was 150 feet away from the front door, he was still forced to move because of his proximity to the resturant's basement entrance.
Other food truck owners have reported similar arbitrary law enforcement. Chris Williams, owner of 502 Café, told The Courier Journal that he had been asked to move his barbecue truck because he was too close to a sandwich restaurant.
The Institute for Justice claims that the similar food caveat discriminates against trucks based on what they sell. Further, according to lead attorney on the case Arif Panju:
"The law and the enforcement has gotten worse over the past couple of years. The city has continually enforced this law at the behest of restaurants to kick truck owners out of vending locations where customers know where to find them, and that is simply an attempt to pick winners and losers…Nobody should need their competitor's permission to operate a businesses. Food trucks in Louisville are being forced to do just that. That is economic protectionism; that is unconstitutional."
Their lawsuit accuses Louisville of violating the 14th Amendment by violating the plantiff's rights to due process through arbitrary enforcement, violating equal protection by discriminating based on what trucks sell, and violating the privileges and immunities clause through unreasonable government interference.
The plaintiffs have legal precedent on their side: The U.S. Court of Appeals for the 6th Circuit has previously ruled that using government to protect one interest group at the expense of another is illegitimate in Craigmiles v. Giles. In this 2002 case, independent casket retailers were forcibly shut down or even arrested for not being licensed as funeral directors in Tennessee. The court ruled that this licensing restriction protected the funeral industry from competitors without serving public safety and was thus unconstitutional. Institute for Justice hopes to use this ruling as precedent and now must prove that the 150 foot ban serves no role in promoting public health and safety but is strictly protectionist.
King would like to see the local food truck industry grow, but the current law acts as a deterrent. Protecting incumbent businesses from innovative competition is an unfortunate trend at the state and local level. Such protectionism limits the choices and quality available to consumers. As summarized by King: "I've always said to myself, if a restaurant was worried about a food truck then they probably need to take a look at their menu."
Below, the Institute for Justice explains the case: