Appeals Court tackles Jacksonville food truck restrictions

North Carolina’s second-highest court heard arguments Tuesday in a case challenging Jacksonville’s food truck regulations. Plaintiffs working with the Institute for Justice argue that the regulations restrict constitutionally guaranteed economic rights.

Superior Court Judge John Nobles rejected the plaintiffs’ legal arguments in January.

“The trial court dismissed our claims that the Jacksonville City Council used its police power to choose winners and losers in a private marketplace,” argued IJ lawyer Bob Belden before the North Carolina Court of Appeals.

“We allege: that the city manager warned the city council of food trucks, saying ‘We must protect the brick-and-mortar restaurant’; that the mayor agreed, saying that food trucks needed to be kept substantial distances away from restaurants; and the city planning and transportation director confirmed for the city council that food trucks would not be allowed to create competition with restaurants,” Belden added.

Belden represents Jacksonville business property owner Nicole Gonzalez and food truck operators Anthony Proctor and Octavius Raymond. Their lawsuit alleges that Jacksonville’s rules block Gonzalez from being able to host a food truck on her property, even though its zoning permits food trucks.

“You can’t be within 250 feet of a restaurant. You can’t be within 250 feet of a property that has another food truck on it. You can’t be within 250 feet of a residential area,” Belden said. The restrictions effectively place 96% of the city off-limits for food trucks, Belden argued.

Belden pointed to the state Supreme Court’s recent ruling in Kinsley v. Ace Speedway to bolster his clients’ argument that their lawsuit should be allowed to move forward. In the Ace Speedway case, the state’s high court allowed race track owners to move forward with a lawsuit claiming that state government officials violated their economic rights when shutting them down during the COVID-19 pandemic.

Jacksonville’s lawyer distinguished city food truck rules from other restrictions courts have struck down in the past.

“There’s a difference between a complete prohibition or a licensing scheme that makes it impossible — literally puts you out of business — and business regulations,” Norwood Blanchard argued.

Judge John Tyson questioned whether a court should second-guess Jacksonville’s elected officials.

“We see regulations passed all the time by cities that a lot of rational people would disagree with, and they can be targeted, and they’ve been upheld under the rational basis standard under the police power,” Tyson said to Belden. “Aren’t you just asking us for a substitution of judgment here?”

Yet Tyson also questioned Blanchard about cases when courts have struck down restrictions on hair braiding, teeth whitening, and “monks making wooden caskets.” “All three of those, the courts overturned the regulation,” Tyson said.

Judge Allegra Collins focused on distinctions between food trucks and brick-and-mortar restaurants.

“You wouldn’t contend that it’s distinguishing that one is mobile and needs parking lots that it doesn’t have and a bathroom that it doesn’t have and poses specific danger parking on the street, those types of things? That’s not distinguishing  from a restaurant that doesn’t move?” Collins asked Belden.

The lawsuit challenges three ways Jacksonville officials “restrict food trucks to eliminate unwanted competition with restaurants,” according to a June court filing. “These included free speech, property rights, economic liberty, and ultra vires claims.”

“Ultra vires” refers to a claim that a government’s actions are beyond its powers.

“But instead of applying each claim’s respective test, the trial court dismissed all the claims at the pleadings stage under a single, incorrect legal test that only requires ‘envision[ing] … reasonably conceivably rational bases’ for the challenged restrictions,” the plaintiffs’ lawyers wrote.

Jacksonville’s lawyers rejected the plaintiffs’ arguments. “Notably, while Plaintiffs’ Complaint and opening Brief are both replete with allegations about the supposedly ‘protectionist’ aims of the mobile food vendor regulations, ‘protectionism’ is not mentioned anywhere in the [Unified Development Ordinance]’s statement of general purpose and intent,” according to a court filing from the city.

In December 2022 Proctor and Raymond gave away free lobster rolls and cheesesteaks in downtown Jacksonville.

Why? Because they said it was arguably illegal to sell them in the city.

The giveaway came as the food truck owners announced their lawsuit against the city. They say Jacksonville’s regulations of food trucks on private property in unconstitutional and “anti-competitive.”

Jacksonville’s regulations effectively ban food trucks from operating within 250 feet of another food truck, restaurant, or residential housing.

“The city of Jacksonville went even further to protect the restaurants in the city from food truck competition,” said Belden. “They regulate the signage available to food trucks, and they also impose a $300 permit fee that far exceeds their cost to regulate food trucks.”

“There are a number of forward-thinking municipalities in this part of North Carolina, like Wilmington, that see the value of the economic impact of having food trucks and increasing food traffic in communities, getting people to buy local and shop local,” said Belden.

Food trucks are subject to the same health and safety requirements as brick-and-mortar restaurants. Twice a year, county health officials inspect the trucks and the food kitchens, called commissaries, that they are required to have.

“We had the food trucks give out some of their food for free, so they aren’t running afoul of any laws,” said Belden. “I have to say the Lobster Roll at Tony’s is really good, and Ray has a cheesesteak with Flaming Hot Cheetos on it and, don’t tell my wife, but I had both.”

Tyson, Collins, and Judge Jefferson Griffin face no deadline to issue a decision in the case, Proctor v. City of Jacksonville.