Sambo's Restaurants Inc. V. City Of Ann Arbor

This case raises novel freedom of speech issues regarding the standard for the waiver of first amendment rights and the scope of first amendment protection to be afforded "offensive" commercial speech. In 1971, Sambo's Restaurants, Inc., petitioned the City of Ann Arbor, Michigan, for site plan approval for construction of a Sambo's Restaurant. When the City Council balked at accepting the proposal, Sambo's agreed not to use that name in connection with the restaurant. Approval by the City Council followed quickly. After six years of operation under the name "Jolly Tiger", the restaurant applied to the City for sign permits to display the name "Sambo's". Those permits were granted, the signs erected, but the permits were subsequently revoked by the City as in contravention of the earlier "agreement". When Sambo's refused to remove the signs, the City threatened legal action. Sambo's then filed this diversity action seeking declaratory and injunctive relief for violations of its constitutional rights, 42 U.S.C. Sec. 1983. The district court's rulings that the company's stipulation not to use the name "Sambo's" was a valid and binding agreement, and that Sambo's had waived whatever First Amendment rights it might possess, form the basis of this appeal.