jonetta rose barras: Who should decide the future of digital advertising in DC?

I had gone downtown mostly to run errands. As I was about to head back to my Brightwood neighborhood, I discovered the two signs just inside the overhang between the escalator to the Metro Center subway station and the exterior side wall of the old Woodward & Lothrop Building, which now houses Forever 21 and several other businesses.

I hadn’t noticed them before. They are, however, indisputable visual evidence that a business development strategy many people thought had been destroyed is, in fact, alive — maybe even thriving in plain sight.

Back in 2015, Donald MacCord Jr., president of Digi Outdoor Media, talked of placing dozens of flashing, digitalized advertisements on buildings throughout DC, creating a scene that some people described as comparable to New York’s Times Square. Despite its garish element, multiple commercial property owners considered the proposal promising and entered into lease agreements that would allow Digi to display its signs on their buildings. 

Aspects of that plan have been realized. In addition to the signs at the Woodies Building at 11th and G streets NW, there are at least nine more in other parts of the city. All of them are the work of Digi Outdoor Media and Digi Media Communications, which has changed its name to Lumen Eight Media Group.

Some of those signs, and others that were expected to be installed, are the focus of an ongoing lawsuit filed in 2016 by DC Attorney General Karl Racine and his team against Lumen Eight on behalf of the DC Department of Consumer and Regulatory Affairs (DCRA). The scrimmage over the Digi signs began within DCRA, and the agency invested a lot of its time dealing with the issue. Oddly, when I asked earlier this week about the initial battle, Jonathan Kuhl, a spokesperson for agency director Ernest Chrappah, refused to provide answers to my specific questions.  

Racine, Lumen Eight and others have fought for the past three years over differing interpretations of the District’s building code and sign regulations; the definition of the exterior versus interior of a building and when a permit is or isn’t needed; and what constitutes an emergency sufficient to justify regulatory changes. 

With the recent filing by each party of motions for summary judgment, the fight may soon be over. Both sides told me they are now awaiting the judge’s ruling, which could come by the end of the year. 

This is no minor dispute. In my mind, there are critical questions that deserve answers: Should the DC Council consider reforming the existing building and sign code? Has enforcement been predictable and fair, or has it been based on connections and favoritism? Should the mayor be allowed to make changes to existing regulations under the guise of an emergency without providing an opportunity for citizens to comment?

Interestingly, at least one of these issues was broached in 2012 well before the current conflict. Then, a comprehensive working group was formed that was supposed to recommend changes to the building code and how signs are handled. That work was never finalized.

Raise your hand if you’re surprised. 

Nationally, outdoor digital advertising has become increasingly prevalent. Unlike printed ads on billboards, electronic ones can rotate every few seconds or minutes. It’s a lucrative business. 

I am no fan. Like many residents, I want to preserve the District’s architectural beauty. I may like visiting Times Square, but I wouldn’t want to live there 24/7.

Still, signs seem ubiquitous locally. They’re at bus stops, on the Capital One Arena, on sections of Nationals Park, in the front window of the H&M department store. A few of those were either installed without permits or have been operating in violation of established agreements between the DC government and their owners.

There is, in other words, a significant and recognizable universe of violators. DC has not moved aggressively against anyone except, it appears, Digi Outdoor Media and, now, Lumen Eight. 

“There is a difference between one sign in a window that is a unique creature under the law and what [Lumen Eight] wanted to do,” said one government official with whom I spoke. 

“If the District is allowed to run roughshod over its own rules and the Administrative Procedures Act to target Lumen Eight, whether at the urging of its competitors or for any other reason, nothing will stop it from doing the same to other businesses,” asserted a Lumen Eight spokesperson.

An OAG spokesperson countered that it’s supportive of the government’s efforts “to ensure businesses understand their responsibilities under the law, and believes businesses must be held accountable when they fail to live up to those responsibilities.” 

The spotlight on Lumen Eight could have been the result of MacCord’s ambition; he passed around brochures that to competitors and advocacy groups suggested a sign or two on every corner. These critics — including the Committee of 100 on the Federal City — filed dozens of complaints with the DCRA and Mayor Muriel Bowser’s office. It didn’t help that Digi ignored stop-work orders.

At the time, MacCord was in charge of the project’s ground operations, explained the Lumen Eight spokesperson. “We do not know what [his] motivation for continued work was, and based on what we have learned about him, would not trust any explanation he might have given.” 

MacCord sought help from Ward 2 DC Council member Jack Evans, asking him to introduce emergency legislation that essentially would have grandfathered Digi into existing law. Evans initially agreed but couldn’t get the support of the supermajority of his colleagues necessary to declare an emergency. He pulled the bill before formally introducing it. 

The relationship between MacCord and Evans has received extensive media scrutiny, but more may well come out in the months ahead. Putting MacCord under the microscope was justified: He recently pleaded guilty to federal charges in California involving defrauding investors, forging contractual agreements and creating fake invoices. He was sentenced to 30 months in jail and has been ordered to repay $1.4 million — the amount he stole from his investors. Prior to his plea, MacCord had already been removed from Digi Outdoor Media. He has no connection with Lumen Eight. 

Evans became embroiled in that case; currently he is the subject of a criminal federal investigation. He has said he expects to be cleared of any criminal wrongdoing.

Lumen Eight representatives say the company didn’t need to be “grandfathered in,” as some have suggested. The company knew “the city had been discussing making changes to the sign code for a year — a project that has still not been completed — and believed its signs were legal under the Legacy Regulation,” said the spokesperson, referring to the rules as they stood prior to July 12, 2016.  

Racine has asserted just the opposite, however. He also has claimed Lumen planned a stealth operation, deliberately working under the radar — installing signs at night, for example. Existing regulations did not allow Lumen Eight to mount signs on the outside of buildings without proper permits, and an emergency regulation validly enacted and approved by the city administrator clarified concerns about what was inside and what was outside.

“District law and the facts of this case are clear, and with this motion, we are asking the judge to uphold the authority of DCRA to enforce the Building Code, order the removal of Lumen Eight’s illegal signs and prohibit the construction of any similar signs in the future,” the AG spokesperson told me.

However, a DC Superior Court judge has already ruled that signs like the ones at the Woodies Building appear to be within the regulations as changed on an emergency basis by the Bowser administration. You can bet that wasn’t the intention. 

The city has made clear it does not want to provide any advantage to Lumen Eight; it has declined even to entertain a negotiated settlement that I was told included an offer by Lumen Eight to limit the number of signs, minimize their size and reduce the hours they would be operational. 

“They want to be treated differently from anyone else,” a government official said. 

I was amused by that statement. After all, based on how the District has dealt with the signage issue, there isn’t one standard or one-size-fits-all approach. The city appears to create special carve-outs and exceptions on a whim, depending on who is asking. For example, when the Nationals wanted digital signs on the stadium, the council approved legislation specifically for that purpose, creating what it called an entertainment district to justify the change to the regulations. It appears there has been no action taken against H&M, whose video display at 11th and F streets NW is visible to pedestrians and others from the outside of the building, which is a violation of the original regulations.

“Lumen Eight is not looking for special treatment. Lumen Eight is looking to be treated fairly,” said the company’s spokesperson.

In its motion, the company said that the AG’s office has provided “no undisputed material facts supporting its motion”; that the “emergency regulation” was not necessary and was not adopted consistent with city laws; and that there was no emergency, as evidenced by the fact that DC waited six months before taking any action.

Separately the Lumen Eight spokesperson said that DCRA was the one engaging in stealth behavior. During the discovery phase of the lawsuit, the company learned that DCRA knew about Lumen’s business plan “as early as December 2015.” The agency “chose to operate in secret,” failing to communicate in “any capacity with Lumen Eight until after the purported [change] of the Legacy Regulation.”

“Until this litigation DCRA had never publicly disclosed its ‘new’ interpretation of the Legacy Regulation which is completely different from the historical interpretation,” the spokesperson added.

What a huge mess. 

It could get worse. If the AG and Lumen Eight can’t work things out, important public policy decisions that stand to affect residents, businesses and the city’s architectural landscape would be taken out of the hands of DC officials and left to a Superior Court judge.

That doesn’t seem like a smart move to me.

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 jonetta rose barras is an author, a freelance journalist and host of The Barras Report television show. She can be reached at thebarrasreport@gmail.com.