Witnesses have made formal complaints over the force used by police to arrest the activist.
Sydney sandwich board activist Danny Lim has been arrested for offensive behaviour with witnesses making formal complaints over the force used to cuff the 74-year-old.
The former local councillor was fined on Friday after three police officers arrested him at Exchange Place in Barangaroo about 9.20am.
It's unclear what the offensive behaviour involved or who made the complaint.
Video of the arrest shows an officer holding a sandwich board sign that reads: "SMILE CVN'T! WHY CVN'T?".
A District Court judge in August 2017 overturned a 2016 conviction and $500 fine against Mr Lim after finding a similar sign worn in 2015 mocking then-prime minister Tony Abbott was unlikely to offend the average Australian.
Using an inverted A in the word "can't", those signs said "TONY YOU CAN'T. LIAR, HEARTLESS, CRUEL" and "TONY YOU CAN'T SCREW EDUCATION."
Niki Anstiss labelled Friday's arrest "disgusting" and is among multiple witnesses to lodge formal complaints over the officers' conduct.
She filmed parts of the arrest and says the older man was very peaceful and wasn't aggressive.
On the other hand, she says police were pointing and shouting at him before one "ripped the sign off his back" and the other two forced the 74-year-old into handcuffs.
"My issue is with the brutality of moving him on with such force," she told AAP.
"He was screaming and crying him 'don't take my sign'."
As two officers led Mr Lim in cuffs to a police van, Ms Anstiss saw a third officer take the lead of the activist's small dog Smarty and follow "faster than the dog could walk".
"It took a woman telling the cop 'You need to pick the dog up' for them to stop dragging it."
Christina Halm said up to 30 people stopped in their tracks and were "all shocked, gasping and crying at what we were seeing".
"I saw police officers use a completely unnecessary and unacceptable amount of force to arrest Danny for wearing a humorous sign," she posted on Facebook.
NSW Police declined to comment when asked about the physicality of Friday's arrest.