Removing Supergraphic Signs: Display of Corporate Responsibility, or Ulterior Motive?

Legally-permitted Van Wagner sign in Hollywood. Company says it will remove more than 60 unpermitted signs at other locations.

If a single supergraphic sign can earn tens of thousands of dollars each month for outdoor advertising companies, why would one of those companies voluntarily decide to remove more than 60 of them various locations in Los Angeles?

In its press release of May 21, New York-based Van Wagner Communications said its promised removal of the 60-plus signs was an “unprecedented display of corporate social responsibility” and the result of the company’s “ongoing effort  to work with Los Angeles City officials on a permanent solution to the City’s ongoing struggles in regulating the outdoor advertising industry.”

While the city’s struggles have certainly been “ongoing” the claims of good corporate citizenship and the amplitude and direction of Van Wagner’s efforts to work toward resolving those struggles deserves some scrutiny.

What the press release doesn’t tell you is that on Sept. 4, 2008, the company filed a lawsuit in U.S. District Court seeking to enjoin the city from taking any enforcement action against its supergraphic signs, which were put up without any permits or inspections.  That was two weeks after District Judge Audrey Collins ruled in the widely-reported World Wide Rush case that the city’s off-site and supergraphics sign ban as applied to that company’s signs was unconstitutional.

Van Wagner’s suit was one of the first of a flood of so-called “copycat” lawsuits that followed the World Wide Rush model in challenging the sign ban on the grounds that exceptions for sign districts, specific plans, and development agreements gave the city too much discretion in allowing some signs but prohibiting others.  (The city appealed Judge Collins’ decision to the 9th Circuit, and a ruling is expected in the next several months)

Six weeks after filing its lawsuit, Van Wagner and the city agreed upon a stay of any enforcement action against the company’s supergraphics, pending the 9th Circuit ruling.  Since the city had just filed their appeal, the stay meant that Van Wagner could keep those unpermitted signs up and collecting revenue for at least a year, and probably many months longer.

As part of that stay, Van Wagner agreed to provide the city the addresses of those supergraphics, but only on condition that the list be kept confidential, and that the company be informed of any requests for it.  Because the stay order didn’t specify an actual number of signs, and supergraphics almost never carry a sign company’s identification, the number and location of Van Wagner’s signs have remained a state and company secret.

But getting back to the company’s altruistic promise to take down big money-making signs it had no permission to put up in the first place, what does Van Wagner expect in return?  For an answer, one has to read past self-serving professions of corporate responsibility and dwell for a moment on the following statement attributed to John Massini, president of Van Wagner’s West Coast Operations.

“While we believe that we have acted at all times within the law, we have made this decision as part of our effort to demonstrate that we wish to work cooperatively with the City in determining a fair system for permitting and converting signs to the digital format and for creating parity in all other areas of sign regulation.”

Setting aside the question of whether putting up signs prohibited by city ordinance and then suing to stop enforcement fits the definition of acting within the law, what exactly is this “fair system” for permitting digital signs and what is meant by “creating parity” in sign regulation.

The first isn’t hard to figure out—Van Wagner is first and foremost a billboard company, albeit with a much smaller footprint in the city than industry giants like Clear Channel and CBS Outdoor.   It also has legal supergraphic signs—defined as such, although by any reasonable measure, they’re billboards—as part of new developments like the Hollywood and Vine/W Hotel project in Hollywood.  Van Wagner wasn’t a party to the now legally-discredited lawsuit settlement that allowed Clear Channel and CBS Outdoor to convert 840 conventional billboards into jumbotrons, but the fact that digital billboards are to sign companies what slot machines are to casinos, revenue-wise, it wouldn’t be any surprise to learn that Van Wagner and other billboard owners want a piece of that lucrative pie and have strategized about how to get it.

Parsing the phrase “creating parity” is a little harder, although a repeating theme of legal challenges to the city’s sign ordinance has been that it discriminates among sign companies because the company that can swing a deal with developers in areas like Staples Center/L.A. Live and the Hollywood Sign District where off-site and supergraphic signs are legally permitted can put up one of the high-revenue signs while other companies are denied that lucrative possibility.  How that issue will ultimately play out is heavily dependent upon what the 9th Circuit justices have to say later this year.

Dennis Hathaway

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