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Mr B's, Inc. v. City of Chicago

Case Date: 12/28/1998
Court: 1st District Appellate
Docket No: 1-97-2149



Mr. B's, Inc. v. City of Chicago, No. 1-97-2149

1st Dist. 12-28-98



SIXTH DIVISION

December 28, 1998

Nos. 97-2149 & 97-2279

MR. B'S, INC., an Illinois corporation; A.B. ASSOCIATES, LTD., an Illinois corporation; CENTER STAGE TICKET SERVICE, INC., an Illinois corporation; and CENTRAL STATES TICKET BROKERS ASSOCIATION, an Illinois not-for-profit corporation,

Plaintiffs-Appellants,

v.

THE CITY OF CHICAGO, a municipal corporation; and ERNEST R. WISH, Director of the Department of Revenue of the City of Chicago, in his official capacity only and not individually,

Defendants-Appellees.

 Appeal from the

Circuit Court of

Cook County

No. 96 L 50040

Honorable

Alexander P. White,

Judge Presiding.

JUSTICE QUINN delivered the opinion of the court:

The instant appeal is brought under Supreme Court Rule 301 (155 Ill. 2d R. 301) from a grant of summary judgment in favor of defendants-appellees in plaintiffs-appellants' action for declaratory and injunctive relief, holding that the City of Chicago's amended amusement tax ordinance is constitutional. In an order dated August 27, 1997, we granted appellants' motion to consolidate the appeal under docket number 97-2279 with an earlier appeal under docket number 97-2149, which was premature as the circuit court had not yet rendered final judgment.

The amended amusement tax ordinance at issue in this case provides that the price that resellers of tickets receive above the face value of the tickets is subject to the 7% amusement tax. Appellants contend that the amendment to the tax ordinance is an unconstitutional service or occupation tax. Appellants alternatively argue that the city's amended amusement tax is an unconstitutional extraterritorial exercise of its home rule authority when applied to ticket brokers located outside the City of Chicago.

On cross-motions for summary judgment below, the court ruled that the tax was constitutional because there was a specific grant of authority from the legislature. The court below also ruled that there is no unconstitutional extraterritorial application of the tax. For the reasons that follow, we affirm the court's order as to the issue of constitutionality, but reverse and remand on the issue of territoriality.

On November 15, 1995, the City of Chicago passed an ordinance that applied its existing amusement tax to the charges that ticket brokers charge on the resale of sports and entertainment tickets, effective January 1, 1996. Chicago Municipal Code