Suit challenges City's eleven month delay in acting on permit application and charges favoritism for South Boston parade organizers who continue to exclude most LGBT groups.
Imposing the $200-400 fee for peaceful political assembly and speech violates the First Amendment.
Court decision expected next year on ordinance banning charitable requests in Lowell's Downtown Historic District.
Court had previously charged Wenzday Jane for "interfering with a police officer" after she used her phone to video-record police questioning three teenagers on a playground.
First Amendment protects rights of demonstrators, including the right to record police officers performing their duties in public.