I doubt the city has any legal standing. As I understand it, the parody is protected as a form of "Fair Use" under copyright law. The First Amendment also protects parody because it's a type of free speech. In my opinion, the city would be hard pressed to make a successful case out of the mockery. Besides, any publicity is good publicity for a parody, even a juvenile one. Lame Disclosure: I am not a lawyer. I could probably play one on TV.
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