The Supreme Court ruled that local municipalities are prohibited from restricting yard signs.
Homeowners Associations are not municipalities. The covenants are allowed to be much stricter than any local code and are more aligned with contract law.
In this instance, the state legislature passed a law striking down any provisions in governing documents that prohibited certain types of signs and allowed their display for a specific window of time (Section 259 Political Code).
Our HOA linked their rules to local law, so when the law was nullified, that left the HOA with nothing. They rightfully gave up.