U.S. District Judge Dee Drell's ruling Wednesday concurs with a magistrate's conclusion that the ordinance is unconstitutional.
Rachel Adams is a fortune-teller who says she accepts donations but doesn't charge for her services. She sued the city after a police officer issued her a court summons in 2011 for violating the ordinance. A violation can result in daily penalties of up to $500.
The city argued the business of fortunetelling is a fraud and inherently deceptive, but U.S. Magistrate James Kirk concluded that fortunetelling is free speech protected by the First Amendment.
Adams told The Town Talk newspaper last year that she is a fifth-generation psychic.