NOT TO BE PUBLISHED
KRAMER, Chief Judge.
The Lexington Fayette Urban County Human Rights Commission ("Commission") appeals an order of the Fayette Circuit Court reversing its determination that appellee, Hands On Originals ("HOO"), discriminated against the Gay and Lesbian Services Organization ("GLSO") in violation of Lexington-Fayette Urban County Government's public accommodation ordinance, Local Ordinance 201-99, Section 2-33 (hereinafter referenced as "Section 2-33" or the "fairness ordinance"), discussed below. The circuit court also determined that if HOO violated the above-stated ordinance, the Commission's application of the ordinance to HOO's conduct, under the circumstances of this case, was unconstitutional. Having carefully reviewed the record and applicable law, we agree HOO did not violate the ordinance and AFFIRM on that basis. Therefore, any discussion of whether an alternative constitutional basis supported the circuit court's judgment is unwarranted.
FACTUAL AND PROCEDURAL HISTORY
The GLSO is a Lexington-based organization that functions as a support network and advocate for gay, lesbian, bisexual, or transgendered individuals. Its membership also includes individuals in married, heterosexual relationships. One such individual, Aaron Baker, functioned as the GLSO's President at all relevant times during this dispute.
HOO is in the business of promoting messages; specifically, it prints customized t-shirts, mugs, pens, and other accessories. Blaine Adamson is one of HOO's owners and manages the business. According to HOO's policy and mission statement, which appears on its website, HOO's menu of services is limited by the moral compass of its owners:
In this vein, the record provides examples of subject matter HOO has refused to promote because its ownership has deemed it morally objectionable, such as adult entertainment products and establishments. The record also provides examples of images HOO has refused to promote, such as the word "bitches" and depictions of Jesus dressed as a pirate or selling fried chicken.
With that said, the Commission alleged HOO violated the fairness ordinance on March 8, 2012. On that date, Don Lowe, on behalf of the GLSO, telephoned HOO to place an order for t-shirts that would bear a screen-printed design with the words "Lexington Pride Festival 2012," the number "5," and a series of rainbow-colored circles around the "5." The GLSO intended to sell these t-shirts to promote the 2012 Lexington Pride Festival, an event it organized and encouraged everyone to attend. Blaine Adamson, on behalf of HOO, answered the telephone call. What happened next was described later in the following exchange between Adamson and an interviewer from the Commission:
Shortly thereafter Aaron Baker, on behalf of the GLSO, filed a complaint with the Commission alleging HOO had discriminated on the basis of sexual orientation and gender identity in violation of Section 2-33. Based upon what Adamson related to its interviewer, the Commission ultimately agreed. In the relevant part of its order, the Commission explained:
In short, the Commission held HOO had violated the fairness ordinance because, by refusing to print the t-shirts requested by the GLSO, HOO had either discriminated on the basis of sexual orientation and gender identity; or had effectively discriminated on the basis of sexual orientation and gender identity by discriminating against conduct engaged in exclusively or predominantly by gay, lesbian, bisexual, or transgendered persons.
HOO subsequently appealed by filing an original action in Fayette Circuit Court. The circuit court reversed the Commission, finding that HOO did not violate the fairness ordinance; and, even if HOO had violated it, the ordinance was unconstitutional as applied under the circumstances of this case. This appeal followed.
STANDARD OF REVIEW
In reviewing an agency decision, this Court, as well as a circuit court, may only overturn that decision if the agency acted arbitrarily or outside the scope of its authority, if the agency applied an incorrect rule of law, or if the decision itself is not supported by substantial evidence on the record. See Kentucky State Racing Comm'n v. Fuller, 481 S.W.2d 298, 301 (Ky. 1972); see also Kentucky Bd. of Nursing v. Ward, 890 S.W.2d 641, 642-43 (Ky. App. 1994). "Judicial review of an administrative agency's action is concerned with the question of arbitrariness." Commonwealth, Transportation Cabinet v. Cornell, 796 S.W.2d 591, 594 (Ky. App. 1990) (quoting Am. Beauty Homes Corp. v. Louisville & Jefferson County Planning & Zoning Comm'n, 379 S.W.2d 450, 456 (Ky. 1964)). Arbitrariness means "clearly erroneous, and by `clearly erroneous' we mean unsupported by substantial evidence." Crouch v. Police Merit Board, 773 S.W.2d 461, 464 (Ky. 1988). Substantial evidence is "evidence of substance and relevant consequence, having the fitness to induce conviction in the minds of reasonable men." Fuller, 481 S.W.2d at 308.
If it is determined that the agency's findings are supported by substantial evidence, the next inquiry is whether the agency has correctly applied the law to the facts as found. Kentucky Unemployment Ins. Comm'n v. Landmark Cmty. Newspapers of Kentucky, Inc., 91 S.W.3d 575, 578 (Ky. 2002) (quoting Southern Bell Tel. & Tel. Co. v. Kentucky Unemployment Ins. Comm'n, 437 S.W.2d 775, 778 (Ky. 1969)). Questions of law arising out of administrative proceedings are fully reviewable de novo by the courts. Aubrey v. Office of Attorney General, 994 S.W.2d 516, 519 (Ky. App. 1998). When an administrative agency's findings are supported by substantial evidence and when the agency has applied the correct rule of law, these findings must be accepted by a reviewing court. Ward, 890 S.W.2d at 642.
The resolution of this appeal involves the application of law to undisputed facts. We begin with a discussion of the law that the Commission argues HOO violated. The fairness ordinance adopts KRS 344.120, which provides in relevant part:
The fairness ordinance then adds to this language, providing that this practice is also unlawful if it is based upon grounds of "ages forty and over," "sexual orientation," or "gender identity."
Under the broad definition of "public accommodation" set forth in KRS 344.130
Because HOO is a store which supplies goods or services to the general public in the Lexington-Fayette area and because none of the exceptions specified in KRS 344.130 otherwise apply to it, HOO qualifies as a "public accommodation" and is therefore subject to the fairness ordinance. The overarching issue presented by this appeal is whether, by refusing to print the t-shirts requested by the GLSO, HOO "den[ied] an individual the full and equal enjoyment of [its] goods, services, facilities, privileges, advantages, and accommodations" and therefore violated the fairness ordinance.
As an aside, finding a violation of KRS 344.120 or the fairness ordinance is a straightforward proposition in situations where a person is ordered off the premises of a business establishment otherwise open to the public, or service is otherwise refused or limited, for no reason except the person's protected status. This is the quintessential example of conduct prohibited by public accommodation statutes. A university could not, for example, refuse to enroll a student because the student is Hispanic. An abortion clinic could not order a person off of its premises solely because that person is Christian. The owner of a Christian bookstore could not refuse to sell books to a person because that person is Muslim. A restaurant that offers a full menu could not serve only a limited menu of heart-smart options to persons over the age of forty.
However, in situations where conduct is cited as the basis for refusing service, applying public accommodation laws is less straightforward. "Some activities may be such an irrational object of disfavor that, if they are targeted, and if they also happen to be engaged in exclusively or predominantly by a particular class of people, an intent to disfavor that class can readily be presumed." Bray v. Alexandria Women's Health Clinic, 506 U.S. 263, 270, 113 S.Ct. 753, 760, 122 L.Ed.2d 34 (1993).
For example, a shopkeeper's refusal to serve a Jewish man, not because the man is Jewish, but because the shopkeeper disapproves of the fact that the man is wearing a yarmulke, would be the legal equivalent of religious discrimination. See id. (explaining "A tax on wearing yarmulkes is a tax on Jews.") A shopkeeper's refusal to serve a homosexual, not because the person is homosexual, but because the shopkeeper disapproves of homosexual intercourse or same-sex marriage, would be the legal equivalent of sexual orientation discrimination. See, e.g, Lawrence v. Texas, 539 U.S. 558, 583, 123 S.Ct. 2472, 2487-88, 156 L.Ed.2d 508 (2003) (O'Connor, J., concurring) (explaining that a law criminalizing only homosexual sodomy "is targeted at more than conduct. It is instead directed toward gay persons as a class."); see also Craig v. Masterpiece Cakeshop, Inc., 370 P.3d 272, 282 (Colo. Ct. App. 2015)
By contrast, however, it is not the aim of public accommodation laws, nor the First Amendment, to treat speech as this type of activity or conduct. This is so for two reasons. First, speech cannot be considered an activity or conduct that is engaged in exclusively or predominantly by a particular class of people. Speech is an activity anyone engages in—regardless of religion, sexual orientation, race, gender, age, or even corporate status. Second, the right of free speech does not guarantee to any person the right to use someone else's property, even property owned by the government and dedicated to other purposes, as a stage to express ideas. See O'Leary v. Commonwealth, 441 S.W.2d 150, 157 (Ky. 1969).
As it held in its order, the Commission argues on appeal that "Acceptance of [HOO's] argument [for why it did not print the GLSO's t-shirts] would allow a public accommodation to refuse service to an individual or group of individuals who hold and/or express pride in their status." (Emphasis added.)
Nothing of record demonstrates HOO, through Adamson, refused any individual the full and equal enjoyment of the goods, services, facilities, privileges, advantages, and accommodations it offered to everyone else because the individual in question had a specific sexual orientation or gender identity. Adamson testified he never learned of or asked about the sexual orientation or gender identity of Don Lowe, the only representative of GLSO with whom he spoke regarding the t-shirts. Don Lowe testified he never told Adamson anything regarding his sexual orientation or gender identity. The GLSO itself also has no sexual orientation or gender identity: it is a gender-neutral organization that functions as a support network and advocate for individuals who identify as gay, lesbian, bisexual, or transgendered.
Also, nothing of record demonstrates HOO, through Adamson, refused any individual the full and equal enjoyment of the goods, services, facilities, privileges, advantages, and accommodations it offered to everyone else because the individual in question was engaging in an activity or conduct exclusively or predominantly by a protected class of people.
As reflected in its order, the Commission characterized the "activity or conduct" in question as (to paraphrase) the GLSO's holding and/or expressing pride in their status of being gay, lesbian, bisexual, or transgendered. As noted, however, the GLSO has no sexual orientation. Its membership and its Pride Festival welcome people of all sexual orientations. It functions as a support network and advocate for others (i.e., gay, lesbian, bisexual, or transgendered individuals). And, the t-shirts the GLSO sought to order from HOO are an example of its support and advocacy of others. While the shirts merely bore a screen-printed design with the words "Lexington Pride Festival 2012," the number "5," and a series of rainbow-colored circles, the symbolism of this design, the festival the design promoted, and the GLSO's desire to sell these shirts to everyone clearly imparted a message: Some people are gay, lesbian, bisexual, and transgendered; and people of their sexual orientations have as much claim to unqualified social acceptance as heterosexuals.
The act of wearing a yarmulke is conduct engaged in exclusively or predominantly by persons who practice Judaism. The acts of homosexual intercourse and same-sex marriage are conduct engaged in exclusively or predominantly by persons who are homosexual. But anyone—regardless of religion, sexual orientation, race, gender, age, or corporate status—may espouse the belief that people of varying sexual orientations have as much claim to unqualified social acceptance as heterosexuals. Indeed, the posture of the case before us underscores that very point: this case was initiated and promoted by Aaron Baker, a non-transgendered man in a married, heterosexual relationship who nevertheless functioned at all relevant times as the President of the GLSO. For this reason, conveying a message in support of a cause or belief (by, for example, producing or wearing a t-shirt bearing a message supporting equality) cannot be deemed conduct that is so closely correlated with a protected status that it is engaged in exclusively or predominantly by persons who have that particular protected status. It is a point of view and form of speech that could belong to any person, regardless of classification.
In other words, the "service" HOO offers is the promotion of messages. The "conduct" HOO chose not to promote was pure speech. There is no contention that HOO is a public forum in addition to a public accommodation. Nothing in the fairness ordinance prohibits HOO, a private business, from engaging in viewpoint or message censorship. Thus, although the menu of services HOO provides to the public is accordingly limited, and censors certain points of view, it is the same limited menu HOO offers to every customer and is not, therefore, prohibited by the fairness ordinance.
A contrary conclusion would result in absurdity under the facts of this case. The Commission's interpretation of the fairness ordinance would allow any individual to claim any variety of protected class discrimination under the guise of the fairness ordinance merely by requesting a t-shirt espousing support for a protected class and then receiving a value-based refusal. A Buddhist who requested t-shirts from HOO stating, "I support equal treatment for Muslims," could complain of religious discrimination under the fairness ordinance if HOO opposed equal treatment for Muslims and refused to print the t-shirts on that basis. A 25-year-old who requested t-shirts stating, "I support equal treatment for those over forty" could complain of age discrimination if HOO refused on the basis of its disagreement with that message. A man who requests t-shirts stating, "I support equal treatment for women," could complain of gender discrimination if HOO refused to print the t-shirts because it disagreed with that message. And so forth. Clearly, this is not the intent of the ordinance.
The Fayette Circuit Court correctly reversed the order of the Lexington Fayette Urban County Human Rights Commission because HOO did not, as the Commission held, violate Section 2-33 of the Lexington-Fayette Urban County Government's Code of Ordinances. We therefore AFFIRM.
D. LAMBERT, JUDGE, CONCURS IN RESULT ONLY AND FILES A SEPARATE OPINION.
TAYLOR, JUDGE, DISSENTS AND WRITES SEPARATE OPINION.
D. LAMBERT, CONCURRING.
I concur with the result reached by the majority opinion. I write separately, however, to state that I would affirm the trial court based on the reasoning of Burwell v. Hobby Lobby Stores, Inc., 134 S.Ct. 2751, 189 L. Ed. 2d 675 (2014). Hobby Lobby makes it clear that the Religious Freedom Restoration Act of 1993 (RFRA), 107 Stat. 1488, 42 U.S.C. § 2000bb et seq., allows closely held, for-profit entities, to freely advance their owners' sincerely held religious beliefs, as long as those beliefs do not offend existing federal laws that pass strict-scrutiny. I would echo the Hobby Lobby decision to hold that KRS 446.350,
At the outset, it is important to clarify what is and what is not at issue. First, HOO is a privately-owned corporation. Second, as the majority points out, HOO did not refuse to print the shirts simply because the GLSO representative is a member of a protected class listed in the fairness ordinance. Rather, HOO refused to print the shirts because the HOO owners believe the lifestyle choices promoted by GSLO conflict with their Christian values. Third, no one questions the sincerity of HOO's owners' religious convictions; in fact, the parties agree that the fairness ordinance substantially burdens HOO's owners' religious beliefs. And fourth, there is little doubt LFUCG has a compelling interest in preventing local businesses from discriminating against individuals based on their sexual orientation. LFUCG must be able to market itself as a place where all people can acquire the goods and services they need. Accordingly, by the plain text of KRS 446.350, the central issue here is whether the fairness ordinance is the least-restrictive way for LFUCG to prevent local business from discriminating against members of the gay community without imposing a substantial burden on the exercise of religion. For the following reasons, I do not believe so.
Here, instead of providing an owner of a closely-held business, or the like, with an alternative means of accommodating a patron who wishes to promote a cause contrary to the owner's faith,
TAYLOR, Judge, DISSENTING.
Respectfully, I dissent. I would reverse the circuit court's opinion and order and reinstate the Lexington Fayette Urban County Human Rights Commission (Commission) order that Hands On Originals, Inc. (HOO) had engaged in unlawful discrimination in violation of Lexington-Fayette Urban County Government's (LFUCG) Ordinance 201-99, Section 2-33 of the Code of Ordinances (Fairness Ordinance).
Although the circuit court primarily relied upon a violation of HOO's constitutional rights to reverse the Commission's order, one member of the majority effectively concludes that the Fairness Ordinance is not applicable to this case on the premise that HOO was engaging in conduct equivalent to "message censorship," and thus said conduct was not in violation of the ordinance. This line of reasoning is misplaced and otherwise ignores the deliberate and intentional discriminatory conduct of HOO in violation of the Fairness Ordinance, in my opinion.
The other majority member's view is that Burwell v. Hobby Lobby Stores, Inc., 134 S.Ct. 2751, 189 L. Ed. 2d 675 (2014) is controlling, effectively concluding that Kentucky Revised Statutes (KRS) 446.350 protects against enforcement of the Ordinance against HOO on religious freedom grounds. This position is also misplaced, in my opinion, as the holding in Hobby Lobby was limited solely to the issue of whether a closely held corporation could raise a religious liberty defense to the insurance contraceptive coverage mandate of the Affordable Care Act. Id. And, I do not believe KRS 446.350 is implicated in this case, as the statute does not prohibit a governmental entity from enforcing laws or ordinances that prohibit discrimination and protect a citizen's fundamental rights. Moreover, the United States Supreme Court has held that religious beliefs or conduct may be burdened or limited where the compelling government interest is to eradicate discrimination. See Bob Jones Univ. v. U.S., 461 U.S. 574, 103 S.Ct. 2017, 76 L. Ed. 2d 157 (1983) (holding that the government has an overriding interest in eradicating racial discrimination in education).
There is no dispute in this case that HOO is a "public accommodation" as defined in the Fairness Ordinance and to the extent applicable, the Kentucky Civil Rights Act as set out in KRS 344.010 et seq., as incorporated therein by the Ordinance. The Ordinance prohibits a public accommodation from discriminating against individuals on the basis of sexual orientation and gender identity. And there is also no dispute that after HOO owner Blaine Adamson spoke with a representative of the Gay and Lesbian Services Organization (GLSO), HOO refused to print t-shirts for GLSO's Lexington Pride Festival (Festival). The primary reason given to GLSO for HOO's refusal to print the t-shirts is that it would have violated the HOO owners' religious beliefs that sexual activity should not occur outside of a marriage between a man and a woman. This refusal to print the t-shirts occurred after an employee of HOO had submitted a written quote to GLSO to print the t-shirts for the Festival.
The LFUCG's policy behind Section 2-33 of the Code of Ordinances is to safeguard all individuals within Fayette County from discrimination in public accommodations on the basis of sexual orientation or gender identity. The conduct of HOO and its owners clearly violates Section 2-33 of the Code of Ordinances in that HOO's conduct was discriminatory against GLSO and its members based upon sexual orientation or gender identity. Adamson testified that upon believing that the Festival advocated homosexuality, among other things, HOO immediately refused to print the t-shirts. Regardless of whether this guise was premised upon freedom of religion or speech, HOO blatantly violated the ordinance. One member of the majority upholds circumventing the public accommodation issue by holding that GLSO as an entity, has no sexual orientation and thus is not protected by the ordinance. This argument fails on its face. GLSO serves gays and lesbians and promotes an "alternative lifestyle" that is contrary to some religious beliefs. That lifestyle is based upon sexual orientation and gender identity that the United States Supreme Court has recently recognized. In Obergefell v. Hodges, 135 S.Ct. 2584, 192 L. Ed. 2d 609 (2015), the Supreme Court held that the fundamental right to marry is guaranteed to same sex couples under the Due Process Clause and the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution. The circuit court sets forth several times in its Opinion and Order that HOO and Adamson refused to print GLSO's t-shirts because of their religious beliefs against same sex relationships. However, gay marriage and same sex relationships are now recognized under the United States Constitution as a fundamental right. Id. Regardless of personal or religious beliefs, this is the law that courts are duty bound to follow.
The majority takes the position that the conduct of HOO in censoring the publication of the desired speech sought by GLSO does not violate the Fairness Ordinance. Effectively, that would mean that the ordinance protects gays or lesbians only to the extent they do not publicly display their same gender sexual orientation. This result would be totally contrary to legislative intent and undermine the legislative policy of LFUCG since the ordinance logically must protect against discriminatory conduct that is inextricably tied to sexual orientation or gender identity. Otherwise, the ordinance would have limited or no force or effect. The facts in this case clearly establish that HOO's conduct, the refusal to print the t-shirts, was based upon gays and lesbians promoting a gay pride festival in Lexington, which violated the Fairness Ordinance.
Finally, it is important to note that the speech that HOO sought to censor was not obscene or defamatory. There was nothing obnoxious, inflammatory, false, or even pornographic that GLSO wanted to place on their t-shirts which would justify restricting their speech under the First Amendment. The record in this case does not remotely establish that the depiction of rainbow colors with the number "5" somehow symbolizes illicit or even illegal sexual relationships. Likewise, there is nothing in the message that illustrates or establishes that HOO either promotes or endorses the Festival. For those of us who grew up in the 60s and 70s, a rainbow was a symbol of peace; others view rainbows as symbolic of love, life, hope, promise, or even transformation. Even the Bible provides that a rainbow is a sign from God. Genesis 9:13.
The Kentucky Supreme Court recently emphasized the importance of free speech in our democracy in Doe v. Coleman, 497 S.W.3d 740 (Ky. 2016). Therein, the Court stated:
Id. at 749.
While free speech is not without its limitations, nothing in the promotion of the Festival by GLSO came close to being outside the protections of the First Amendment. The Fairness Ordinance in this case is simply an extension of civil rights protections afforded to all citizens under federal, state and local laws. These civil rights protections serve the societal purpose of eradicating barriers to the equal treatment of all citizens in the commercial marketplace. See State of Washington v. Arlene's Flowers, Inc., ___ P.3d ___, 2017 WL 629181 (Wash. 2017).
Accordingly, I believe the conduct of HOO in this case violated the Fairness Ordinance. I would reverse the circuit court and reinstate the order of the Commission holding HOO in violation thereof.