Santa Ana to Pay Adult Theater $200,000 to Settle Legal Fight

The City of Santa Ana, ending a costly, 10-year battle to close down an X-rated movie theatre, agreed Monday to allow the Mitchell Brothers theater to keep showing adult films and to pay its owners $200,000.

City Atty. Edward J. Cooper fashioned the settlement, in which the city agreed to cease all lawsuits and pay the theater chain a court-ordered $80,000 for attorney’s fees.

In return, Mitchell Brothers agreed to stop advertising its X-rated films on a marquee fronting 17th Street and to remove all but the words “Santa Ana Theater” from the building. For that concession, the city will pay the chain an additional $120,000, Cooper said.

The City Council voted 6 to 1 in favor of the settlement agreement Monday night. Only Councilman John Acosta, a staunch opponent of pornography, was opposed.

The city has spent almost $500,000 in attorneys fees and court costs, and has filed more than 40 suits since 1977 in the matter.

Mitchell Brothers attorney Tom Steel, who called the settlement “terrific,” said Monday that theater owners Artie and James Mitchell simply wanted to end the lawsuits and “create a status quo that everyone can live with.”

Steel said marquee changes should not hamper the theater’s business.

“Thanks to this litigation, I think the location . . . is very well-known in Orange County,” he said.

Cooper called Monday’s settlement a positive development.

“It’s not as good (a settlement) as we had before . . ., “ he said, referring to a tentative agreement, rejected by the council last year, that included a promise from theater owners that they would not renew their lease when it runs out in 1990.