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A federal appeals court has ruled unconstitutional a Utah Department of Transportation requirement that groups wishing to hold demonstrations on state roadways purchase a minimum insurance policy of at least $1 million.

The 10th Circuit Court of Appeals in Denver issued an opinion on Monday upholding a decision out of the federal court in Utah that struck down the UDOT requirement that groups must purchase an insurance policy and sign an indemnification agreement as a violation of free speech rights.

U.S. District Judge Robert Shelby ruled last year in favor of iMatter Utah, which wanted to hold marches on State Street in Salt Lake City in 2011 to raise awareness of climate change but couldn't pay the $2,500 cost of the policy. Positive Change Utah ran into the same problem when it sought a permit for a State Street march that same year.

The 10th Circuit Court, in upholding Shelby's ruling, said UDOT did not meet the burden of proving its requirements were strictly related to its interests in protecting the public treasury against possible costs, such as liability for an accident.

"In this case, Utah has failed to show how the costs it imposes on applicants align with the actual expenses Utah incurs in hosting a parade," the appeals panel said.

It also cited state statutes that already indemnify the state from most lawsuits.

"Given Utah's broad immunity, we suspect that Utah's potential parade liability — other than liability resulting from its own conduct — should be vanishingly small," the justices said, adding "Utah cannot require the permittee to bear the cost of insuring Utah against Utah's own negligence."

John Mejia, legal director for the American Civil Liberties Union of Utah, one of the entities that brought the lawsuit on behalf of the groups, said the decision was a victory for free speech.

"I think it vindicates a need for a robust presence of protesters on public streets," Mejia said, calling the appeals court decision "a reminder for government that it has to be very careful when it limits speech in a traditional public forum."

The Utah Attorney General's Office had no immediate comment on the ruling, nor did UDOT.

iMatter Utah sued after UDOT declined to approve its request for a permit for a May 7, 2011, "marade" — march and parade — about climate change. The group planned to have participants walk from the federal courthouse at 125 S. State St. to the Live Green Salt Lake City Festival at Library Square.

UDOT refused to issue a permit unless the group paid for an insurance policy and signed liability waivers from each participant, something it said is required of all groups. iMatter said it could not afford a policy at a cost of $300 to $500.

After failing to get a temporary restraining order allowing it to use the street, iMatter staged its march on the public sidewalk.

In September 2011, iMatter held a second march — this time walking from the state Capitol to the City-County Building — and again stayed on sidewalks. Positive Change Utah, ran into the same obstacles.

UDOT had argued that its restrictions were aimed at public safety and were constitutionally sound since groups who could not afford a permit could move their events to the sidewalk or adjacent city streets.

But Shelby noted neither sidewalks nor other roads carry the "deep historical and political significance" of State Street, which passes the state Capitol, the U.S. Federal Building, the state courthouse and the City-County Building.

The 10th Circuit decision, however, did discard an iMatter argument that the UDOT permit requirements were unconstitutional because they should have contained an exemption for groups unable to afford the insurance.