Chicago Food Trucks - Background

Litigation Backgrounder

Sweet Home Chicago?

Food Trucks Get the Cold Shoulder in the Windy City
 

The Issue in a Nutshell

Cities across the United States are experiencing the benefits of food trucks.  But not Chicago, which has historically prohibited food trucks from cooking on board and told them they must stay more than 200 feet of a brick-and-mortar restaurant.  So when the city announced it would be revising its vending laws, many food fans were excited. 

The law that passed, however, was less than advertised. Although the law lets trucks cook on board, it continues to make it illegal for them to operate within 200 feet of any fixed business that serves food.  The fines for violating the 200-foot rule are up to $2,000—ten times larger than for parking in front of a fire hydrant.  And to enforce the 200-foot rule, the City is forcing food trucks to install GPS tracking devices that broadcast their every move. 

Chicago passed this law at the request of a few politically connected restaurateurs who don’t want the competition, including Alderman Tom Tunney, who own Ann Sathers restaurant and yet sponsored the measure.  But restaurants and food trucks peacefully co-exist elsewhere, with the best food-truck cities in the country also having thriving restaurant industries.  In any event, consumers should decide who wins or loses in the marketplace, not the government. 

To protect the rights of all Illinoisans, two Chicago-area food trucks—The Schnitzel King and Cupcakes for Courage—have joined forces with the Institute for Justice to challenge Chicago’s new food-truck ordinance.  This lawsuit, filed on November 14, 2012 in Cook County Circuit Court, argues that the 200-foot rule and the GPS tracking requirement violate the Illinois Constitution.  And when these trucks prevail, they will strike a blow for entrepreneurs of all stripes in the state. 

 

Introduction

Food trucks are an American success story.  Just a few years ago, food trucks were known for serving coffee and sandwiches to construction workers.  But as the housing market crashed and social media blossomed, a few intrepid chefs realized that they could use the trucks to take their food directly to the people. 

Chicago is a city that prides itself on its food.  But despite that, the city lagged behind when it comes to food trucks, largely due to the fact that Chicago’s laws restricted what food trucks could serve and where they could go.  So both foodies and entrepreneurs were excited to hear that the city planned to amend its food-truck law. 

Those hopes were soon dashed.  At the behest of a few politically connected restaurateurs, one of whom is Alderman Tom Tunney, the City Council passed a law that, as the Chicago Tribune said, “seems designed to contain the food truck trend, not to nurture it.”[1]  That’s because the new law continues the 200-foot rule, forces food trucks to install tracking devices that let City officials follow their every move, and imposes fines of up to $2,000for violating the 200-foot rule—more than ten times the fine for parking in front of a fire hydrant. 

Chicago has its priorities backwards; it should focus on protecting public health and safety, not hurting consumers by restricting competition.  To protect their right to serve their customers, two Chicago food trucks—The Schnitzel King and Cupcakes for Courage—have teamed up with the Institute for Justice to challenge Chicago’s ill-conceived law in Illinois state court.  The goal is simple:  Save this nascent industry, protect Illinoisans’ right to economic liberty, and make cities think twice before passing anti-competitive laws like this in the future.

 

Chicago:  The City that Works?

Like Chicago, food trucks have a long and storied history.  Historians trace the origin of the food truck back to the Old West, where cowboys during a cattle drive would be out in the wilderness for days.  To serve the cowboys meals, ranchers retrofitted old Civil War era wagons, loaded them with pans and provisions, and the “chuck wagon” was born. [2]  The successor to these wagons, the night lunch wagon, served late-night workers and began appearing in New York and other major cities several decades later.[3]  Many of these wagons were initially mobile but became and more wedded to a single location over time.  These wagons became fixed in place and turned into the diners that we know today.

Despite their long pedigree, food trucks have only recently become a mainstream phenomenon, with cities across the country just now starting to embrace them and the benefits they provide to customers and the larger community.  Food trucks offer convenience and variety to consumers.  Many office workers typically have a limited time for lunch and only a few nearby dining options.  Food trucks, on the other hand, often sell specialty products that are too “niche” for a fixed business, such as a lobster roll or Vietnamese Banh Mi sandwich, which can be a welcome change of pace for workers who would have otherwise “brown-bagged” it. 

Food trucks make cities safer and more exciting places to live.  As Jane Jacobs, the famous author and activist, wrote, “A well-used street is apt to be a safe street.”[4]  By drawing consumers out, food trucks turn empty streets into vibrant marketplaces.  Furthermore, food-truck “rallies” are popular social events that frequently draw tens of thousands of hungry customers to otherwise underutilized areas.[5] 

Food trucks give chefs a chance to create jobs for themselves and others.  Notably, though, these jobs do not come at the expense of traditional brick-and-mortar restaurants.  Those cities with the most vibrant food-truck industries also tend to be the ones with the best restaurant scenes.  Many food trucks call Austin, Tex., Los Angeles, and New York City their homes, but none of these cities is suffering from a dearth of restaurants.  Indeed, a news story in the Austin American-Statesman reported that restaurateurs and economists in Austin generally agree that the rise of food trucks has led to a boon in the city’s restaurant scene.[6] 

In fact, vending can often give entrepreneurs the tools and capital they need to try their hands at the restaurant business.  One example is Portillo’s, perhaps the company most affiliated with the iconic Chicago hot dog.  In 1963, Dick Portillo opened his first location, a six by 12 foot hot dog trailer, on North Avenue in Villa Park.  Years later, Portillo’s is a national brand, with 35 locations in Illinois, Indiana, and California that collectively employ thousands of people. 

Food trucks also give restaurants a way to extend their brands and reach new customers.  Scott Gregerson is managing partner of Curried, a Loop-area Indian restaurant that launched a Curried-branded food truck in 2011.  In an interview with the National Federation of Independent Business, Gregerson said that “we’ve definitely seen an increase in business at the restaurant” due to the food truck.[7]  Restaurants nationwide, including some national chains, are also jumping into the food-truck fray.[8]

With these benefits, one would expect that Chicago would embrace food trucks.  But sadly, Chicago’s laws make it one of the worst places to operate a food truck in the country.  Until recently, food trucks in Chicago could not prepare food on board; all of their food had to be made in a kitchen and kept warm on the truck. Trucks could not operate between 10:00 p.m. and 10:00 a.m., making it impossible for trucks to serve breakfast or late-night dinners.  And since 1991, it has been illegal for any food truck (except those serving construction workers) to operate within 200 feet of a restaurant.

Not surprisingly, the number of food trucks in Chicago trails that in many similarly sized cities.  As of July 2012, there were only about 120 food trucks on the road in Chicago, only 50 of which constitute modern “gourmet” food trucks; the rest generally serve construction sites.  By way of comparison, Los Angeles County has more than 2,400 food trucks.[9]  

So many were excited when Mayor Rahm Emanuel introduced his food-truck ordinance.  The new law let food trucks prepare food on board.  It required the city to install five dedicated food truck stands in areas with more than 300 restaurants.  And it expanded the trucks’ hours of operation by letting them sell from 5:00 am to 2:00 am, much longer than the 12 hours before. 

The ordinance, however, contained some less than laudable changes, with a small cadre of powerful restaurateurs and aldermen pushing for restrictions to “protect” their restaurants from competition.  One powerful force was Alderman Tom Tunney, who owns several Ann Sathers’ restaurants and previously said, “One of the major issues is spacing from brick-and-mortar restaurants. . . . We need to make sure we protect … restaurants.”[10]  Another vocal restaurateur was Glenn Keefer, who implied that the trucks were “peddling substandard fare while often breaking rules, clogging traffic and littering our streets.”[11] 

None of these claims are true.  As the Institute for Justice notes in Seven Myths and Realities about Food Trucks: Why the Facts Support Food Truck Freedom, available at http://www.ij.org/vending, a vibrant food-truck industry can help restaurants by increasing the number of available consumers and by giving them a new way to reach their customers.[12]  Nor do trucks, as Mr. Keefer said, peddle substandard fare or litter the streets.  A review of Los Angeles County health records showed that food trucks are just as clean as their brick-and-mortar counterparts. [13]  And food truck associations in Chicago and across the country have been especially diligent in reminding their members to keep their areas clean. [14]  Cities looking for a better way to regulate food trucks than Chicago can look at Food Truck Freedom:  How To Build Better Food Truck Laws in Your City, available at http://www.ij.org/vending.

Despite their inaccuracy, the claims by Keefer and others had the desired effect.  The ordinance kept the ban on food trucks operating within 200 feet of a restaurant.[15]  If a truck gets too close, its owner faces fines of $1,000 to $2,000.  And to enforce the 200-foot rule, the ordinance requires trucks to install a global positioning system (GPS) tracking device so the City can monitor their whereabouts.  Although GPS units are imprecise,[16] the ordinance presumes that a food truck was where the vehicle’s GPS device says it was.”[17]  Chicago’s GPS requirement is quite unusual—only one other major city, Boston, requires it[18]—and quite intrusive. 

As can be seen below, the 200-foot rule has turned entire swaths of Chicago, particularly prime commercial locations like the Loop, into no-vending zones.

Although the City is required to install five food-truck stands in each community area with over 300 restaurants, including the Loop, this does not fix the problems the City’s 200-foot rule creates.  First, the City has not met its obligations under the law:  Although the law says the City “shall” create 30 stands in six of the City’s community areas, only 21 stands have gone up.  In fact, Chicago removed one proposed spot after some brick-and-mortar businesses said that they didn’t want to compete with the food trucks that would be using the stand.[19]  

Similar problems plague the Loop, where the City has created only four food-truck stands despite the ordinance’s language and the fact that the area is where the single largest group of food trucks’ potential customers work.  Worse yet, the Loop’s four stands are not convenient:  One is near Buckingham Fountain in Grant Park, while the others are all north of Adams Street.  Overall, the few stands the City has authorized do not change the fact that the law denies most hungry office workers a chance to grab a quick bite at their favorite food truck.

Members of the fledging food-truck community voiced their concerns about the ordinance, but to no avail.  Many aldermen ignored those who supported the food trucks, including almost 2,000 area residents who petitioned for food-truck freedom.[20]  As a result, the ordinance moved quickly.  On July 19, the Committee on License and Consumer Protection forwarded the bill, largely unchanged, to the full City Council.  Six days later, the Council voted 44-1 in favor of the ordinance.  The sole “no” vote came from Alderman Tom Arena, who succinctly summarized the bill when he said, “A brick-and-mortar restaurant lobby got ahold of [the ordinance], and it was stuffed with protectionism and baked in the oven of paranoia.”

 

Food Truck Owners Stand Up for Economic Liberty

Many people, after experiencing a legislative defeat, would give up their fight for economic liberty.  But food truckers are resilient people who through their hard work and ingenuity have made something out of nothing.  Rather than just accepting their fate, two Chicago-area food trucks are standing up to fight for their right to earn an honest living. 

Greg Burke and Kristin Casper, the team behind the Schnitzel King food truck, don’t know how to quit.  Greg Burke has an engineering degree and used to work in construction.  The collapsing real-estate market, however, forced his company to layoff him and all his fellow employees.  After having no success finding work, Greg took matters into his own hands.  

For years, Greg had been frying schnitzel (a hand-breaded and fried pork or chicken cutlet) at Chicago Bears games, putting it between two pieces of bread, and topping it with grilled onions and peppers.  People loved Greg’s sandwiches and told him that he should sell them for a living.  So Greg did just that:  He pulled together his life savings, bought a vintage 1970s Jeep, and became the Chicago Schnitzel King.  Kristin planned on managing the social media & public relations aspect of Schnitzel King part-time, but she started working for the truck full time once she herself was laid off. 

Joining Greg and Kristin in their fight for food-truck freedom is entrepreneurial dynamo Laura Pekarik, who owns and operates the Cupcakes for Courage food truck.  When Laura’s sister, Kathryn, was diagnosed with non-Hodgkin’s Lymphoma, Laura and her mother quit their jobs to take care of her.  During that time Kathryn and Laura created many new cupcakes recipes while Kathryn went through her cancer treatment. 

After Kathryn recovered, Laura thought about returning to her job, but instead chose to go into business for herself.  Like many new entrepreneurs, Laura didn’t have the money for a storefront location, so she opened Cupcakes for Courage in June 2011.  Laura donates 10% of Cupcakes for Courage’s proceeds to cancer charities.  As a result of her success, Laura opened a brick-and-mortar location in September 2012.[21]  Named Courageous Bakery, the store also serves as the new home for the food truck, which continues to operate throughout all of Chicago.

 

Open Markets, Open Opportunities: Legal Claims

Greg, Kristin and Laura are bringing a legal challenge against parts of the city’s food-truck ordinance not because that challenge will be easy, but because it is right.  Competition is the American Way; it makes us innovate, work hard, and serve better food, all of which benefits consumers.  But local governments thwart that competition by enacting anti-competitive rules at the request of a few politically connected actors. 

What’s happened here is not just wrong; it’s unconstitutional.  Governments exist to protect public health and safety, not pick winners and losers in the marketplace.  Thankfully, the Due Process Clause of the Illinois Constitution protects all Illinoisans’ right to earn an honest living, and Illinois courts have repeatedly struck down laws that would “manage” competition on behalf of a preferred special-interest group. 

The Due Process Clause of the Illinois Constitution requires that laws further a legitimate government purpose, such as protecting the public’s health and safety.  But Chicago’s 200-foot rule, also known as a proximity restriction, exists solely to protect brick-and-mortar restaurants from competitors.  Courts throughout the country have stricken down attempts by local government to enact restrictions to favor the politically connected.  In Thunderbird Catering Co. v. City of Chicago, the Cook County Circuit Court—the same Court that Schnitzel King and Cupcakes for Courage are in—invalidated an earlier version of the 200-foot rule.[22]  In People v. Ala Carte Catering, a California state court held that prohibiting food trucks from operating within 100 feet of a restaurant was unconstitutional.[23]  And the New York Court of Appeals upheld a decision striking down a law that kept peddlers from operating within 250 feet of a store selling the same item if the owner objected.[24]  The lesson is clear:  Businesses should succeed or fail based on how good their products are, not on who they know at City Hall. Chicago’s attempt to enforce the 200-foot rule by making all food trucks install GPS tracking devices is equally unconstitutional.  The Searches, Seizures, Privacy and Interceptions Clause to the Illinois Constitution prevents cities from conducting searches for anti-competitive reasons.[25]  Further, the U.S. Supreme Court has recognized that “GPS monitoring generates a precise, comprehensive record of a person’s public movements.”[26]  Because GPS tracking devices reveal so much, the government must show that the devices are necessary and that their use is circumscribed.  But nothing in Chicago’s law limits how, when, or for what reason City officials can access or use the information these devices transmit.  This kind of discretion is incompatible with the decisions of the U.S. and Illinois supreme courts, which have said that the “time, place, and scope of the inspection [must be] limited.”[27] 

 

The Litigation Team

The Institute for Justice filed its complaint in this case, Burke v. City of Chicago, on November 14, 2012.  The litigation team for the Institute for Justice in this case is IJ Attorney rfrommer@ij.org">Robert Frommer and IJ Senior Attorney bgall@ij.org">Bert Gall.

 

The Institute for Justice: A History of Protecting Economic Liberty

As the nation’s leading libertarian public interest law firm, the Institute for Justice engages in cutting-edge litigation and advocacy nationwide to defend individual rights from overreaching government: 
  • Castaneda v. City of El Paso—In January 2011, the Institute for Justice brought suit against the City of El Paso, which stopped mobile food vendors from operating within 1,000 feet of a restaurant or convenience store, and prohibited them from stopping to await customers anywhere in the city.  As a result of the lawsuit, the city passed a new ordinance that eliminated these and other protectionist restrictions.
  • Membreno v. City of HialeahIn October 2011, the Institute for Justice Florida Chapter filed a lawsuit in state court on behalf of street vendors.  These vendors are challenging a law passed by Hialeah, Fla. (located near Miami), that forces them to constantly be on the move and prevents them from vending within 300 feet of any store that sells “the same or similar” merchandise.
  • Miller v. City of AtlantaIn July 2011, the Institute for Justice brought suit on behalf of two street vendors who work outside the Atlanta Braves’ baseball stadium.  Two years earlier, Atlanta handed over all street vending in the city to a single company—the first program of its kind in the country.  In so doing, Atlanta exceeded its authority under its charter and violated the Georgia constitution.   
  • Saint Joseph Abbey v. CastilleIn August 2010, the Institute for Justice teamed up with the monks of Saint Joseph Abbey in Louisiana to challenge a requirement that they be licensed as funeral directors just to sell their handmade wooden caskets.  In July 2011, the U.S. District Court for Eastern District of Louisiana struck down the requirement, declaring that “the sole reason for these laws is the economic protection of the funeral industry.”  The Fifth U.S. Circuit Court of Appeals is now poised to affirm that ruling.
  • Uqdah v. D.C. Board of Cosmetology—In 1993, an Institute for Justice lawsuit led the District of Columbia to eliminate a 1938 Jim Crow-era licensing law against African hairbraiders, which was put in place by cosmetologist who didn’t want the competition.

[1] Editorial, Putting the brakes on food trucks, Chicago Tribune, July 25, 2012, http://articles.chicagotribune.com/2012-07-25/news/ct-edit-trucks-20120725_1_food-trucks-gps-spaces.

[2]Richard Myrick, The History of American Food Trucks, Mobile Cuisine, July 2, 2012, http://mobile-cuisine.com/business/the-history-of-american-food-trucks/.

[3] Josh Clark, Food Truck begat Diners; or, What’s old is new again, Nov. 22, 2011, http://blogs.howstuffworks.com/2011/11/22/food-trucks-begat-diners-or-whats-old-is-new-again/.

[4] Jane Jacobs, The Death and Life of Great American Cities 44 (Modern Library 1993) (1961).

[5] See, e.g., Sarah Meehan, Organizers hope to grow Baltimore, D.C. food truck competition, Baltimore Business Journal, June 25, 2012, http://www.bizjournals.com/baltimore/news/2012/06/25/organizers-hope-to-grow-baltimore.html.

[6] Brian Garr, Food trailers bloom into key piece of Austin’s economy, The Austin Statesman, Sept. 15, 2012, http://www.statesman.com/news/business/food-trailers-bloom-into-key-piece-of-austins-econ/nSLPx/.

[7] NFIB, How My Restaurant Launched a Food Truck, http://www.nfib.com/business-resources/business-resources-item?cmsid=60625.

[8] See, e.g., Dan Steinberg, Chick-fil-A prepares D.C. food truck launch, Washington Post, July 5, 2012, http://www.washingtonpost.com/blogs/going-out-gurus/post/chick-fil-a-prepares-dc-food-truck-launch/2012/07/05/gJQAjim9PW_blog.html.

[9] Stephanie Armour, Gourmet Food Trucks Fight Inspectors’ Perceptions, http://www.businessweek.com/news/2012-05-09/gourmet-food-trucks-fight-inspectors-perceptions.

[10] Fran Spielman, Restaurant-owning alderman demands limits on mobile food truck proposal, Chicago Sun-Times, June 16, 2011, http://www.suntimes.com/news/politics/5983223-418/restaurant-owning-alderman-demands-limits-on-mobile-food-truck-proposal.html.

[11] Chicago deserves better rules on food trucks, Crain’s Chicago Business (May 10, 2012), http://www.chicagobusiness.com/article/20120510/NEWS07/120509756/chicago-deserves-better-rules-on-food-trucks.

[12] Seven Myths and Realities About Food Trucks, Nov. 2012, http://www.ij.org/vending.

[13] Id.

[14] Id.

[15] Chicago City Code § 7-38-115(f).  This rule, which applies to “any public place at a fixed location . . . held out to the public as a place where food and drink is prepared and served for the public for consumption on or off the premises,” extends beyond restaurants and bans trucks from operating near “coffee shops, cafeterias, dining rooms, . . . [and] tearooms,” which makes it illegal for a food truck to come too close to a 7-11, for instance, or a Starbucks. 

[16] One article states that the common commercial standard of GPS tracking gives the device’s exact location plus/minus 9.8 to 16.4 feet 95% of the time, while the other 5% could mislocate the device by 32.8 feet or more.  http://cincyhalfmarathon.com/GPS Accuracy.pdf.

[17] Chicago City Code §  7-38-115(l).

[18] City of Boston, Mobile Food Truck: GPS Systems, http://www.cityofboston.gov/business/mobile/gps.asp

[19] Hal Dardick, 2 proposed food truck areas dashed, Chicago Tribune, Oct. 25, 2012, http://articles.chicagotribune.com/2012-10-25/news/ct-met-food-truck-stands-1025-20121025_1_food-truck-meter-revenue-locations.

[20] See Alex Levine, Support Chicago Food Trucks, http://www.change.org/petitions/support-chicago-food-trucks.

[21] Courageous Bakery: Home of Cupcakes for Courage now open in Elmhurst, Sept. 24, 2012, http://www.mysuburbanlife.com/news/x264118690/Courageous-Bakery-Home-of-Cupcakes-for-Courage-now-open-in-Elmhurst.

[22] Thunderbird Catering v. City of Chicago, No. 83L52921 (Cook Cnty. Cir. Ct. Oct. 15, 1986) (invalidating provisions in food-truck law that ordered trucks to stay 200 feet from restaurants serving a “similar” food item).

[23] 159 Cal.Rptr. 479 (1979),

[24] Duchein v. Lindsay, 34 N.Y.2d 636 (1974). 

[25] Article I, Section 6 of the Illinois Constitution protects the right of individuals “to be secure in their persons, houses, papers and other possessions against unreasonable searches, seizures, invasions of privacy or interceptions of communications by eavesdropping devices or other means.”

[26] Jones, 132 S.Ct. at 955 (Sotormayor, J., concurring)

[27] New York v. Burger, 482 U.S. 691, 711 (1987). 


Email Address
Please enter a valid email address
Share

Institute for Justice
901 N. Glebe Road, Suite 900
Arlington, VA 22203
Tel 703.682.9320, Fax 703.682.9321
© 1997-2014