OTR, which specializes in papering bulletins, wallscapes, spectaculars and construction bridge wraps in and around New York, filed a complaint this week challenging the city's Local Law 31, which regulates outdoor advertising. Passed last year, the law requires permits for privately owned advertising signs. The city's own signs, meanwhile, are exempt from the requirements, and OTR is crying foul. In its suit, OTR claims the billboard laws violate free speech, equal protection laws, and anti-trust laws while giving the city an unfair advantage in the market.
Creating a monopoly
"Many companies in this industry are upset, and for good reason," Ari Noe, CEO of New York-based OTR, said in a statement, which accuses the city of monopolizing the outdoor advertising business. "To protect ourselves, as well as the labor unions, small businesses, and consumers who will all be affected, OTR Media Group feels it is necessary to take legal action," the statement went on to read.
OTR is also suing Cemusa, the Spanish company that last year won the city's multibillion-dollar contract to build bus shelters, newsstands and public toilets with exclusive rights to advertise on them. OTR alleges that the 20-year contract, which the city expects to get $1.3 billion in advertising revenue, will drive up prices for outdoor advertising while increasing the value of city-owned signs. Cemusa could not be reached for comment.
OTR, whose major clients include General Motors Co., Warner Bros. and JP Morgan Chase, has retained lawyer Daniel Alter of Alter & Alter. The suit was filed in the New York State Supreme court.
"We are awaiting the legal papers, and will evaluate them thoroughly," Sheryl Neufeld, senior counsel in the administrative law division for the city's Law Department, said in a statement.
OTR's claim follows three previous federal lawsuits filed against the city in October, two from Clear Channel Outdoor and one from Atlantic Outdoor Advertising. The two actions are now before the same judge, with both contending that the city's regulations are unconstitutional because they do not advance the city's interest in promoting traffic safety and aesthetics.
"We believe that there is absolutely no merit to these claims in the federal cases," Ms. Neufeld said. "The city's regulation of outdoor signs addresses important public interests in minimizing visual clutter and reducing unnecessary distractions to drivers on its major roadways."