Philadelphia, Pennsylvania (CNN) -- A federal trial is underway that could settle a dispute between Philadelphia Boy Scouts and the city.
The national Scout policy that prohibits the hiring of homosexuals puts the Philadelphia Scout chapter, the Cradle of Liberty Council, in violation of the city charter and an ordinance outlawing discrimination on the basis of sexual orientation and other grounds.
The Scouts were told by the city to pay $200,000 a year to lease the building or vacate their headquarters that have been located on city land, rent-free since 1928.
In 2000, the U.S. Supreme Court ruled that the Boy Scouts could exclude gay youth and troop leaders because the group is categorized as a "membership organization." The city contends Cradle of Liberty Council's refusal to openly reject the national scout policy violates the City Charter.
The lawsuit filed by the Cradle of Liberty Council contends the city's ultimatum violates their First Amendment rights and that the city's position is unconstitutional and violates the organization's right to free speech and equal protection. The trial began Monday with jury selection.
The Scouts also argue that city leases property to other organizations that have membership rules, including a Catholic church and the Colonial Dames of America, and those tenants do not face eviction, said attorneys for the Scouts. The city said the comparison is inaccurate.
In 2007, City Council passed an ordinance to evict the Scouts and later went to court in June 2008 to do so, but Cradle filed the federal civil-rights lawsuit in May 2008.
In 2009, U.S. District Judge Ronald Buckwalter issued an injunction stopping the city from evicting the Scouts until the federal lawsuit is resolved.