N.Y. Court Gives a Merry X-mas to Adult Businesses

Rhett Pardon
ALBANY, N.Y. — Adult entertainment companies have been given another chance to fight a New York City law that keeps them out of most neighborhoods.

Thursday’s New York Court of Appeals decision effectively blocks the city’s bid to close or move more than 100 strip clubs, adult movie theaters and video stores.

Several venues that include adult cabarets and retailers that sell adult material sued the city over a 2001 amendment to a 1995 zoning law that banned all adult entertainment activity from neighborhoods outside certain industrial areas. Plaintiffs claimed their free speech rights were violated.

The businesses operated under the “60/40” rule, which provided that a business could not be called an adult establishment if less than 40 percent of its floor space or inventory was devoted to adult content.

But the Court of Appeals ruled, 4-3, to send the case back to a lower court, deciding that the city needs to show that the so-called “60/40” businesses still display a “predominant, ongoing focus on sexually explicit materials or activities" to justify strengthening the 1995 ordinance.

If not, Judge Susan Phillips Read said, “plaintiffs will prevail” at trial.

In 2001, Mayor Rudolph Giuliani proposed an amendment to the law to curb what he saw as a loophole allowing sex shops to continue operating in zones where they should have been excluded. The shops did this, the Giuliani administration argued, by rearranging their floor space and stocking a token amount of nonpornographic items to avoid being tagged as a sex store.

In the case, New York City argued that an amendment to a 1995 law simply closed a loophole and did not create a new law.

New York officials also contended that the amendment would help mitigate secondary effects they claimed the businesses had on their neighborhoods, such as lower property values, increased amounts of trash and higher crime rates.

The businesses sued and won their case in Supreme Court. That ruling was later overturned by an appellate court.

Attorney Martin Mehler, representing the Pussycat Lounge — a rock club that also includes an adjacent adult cabaret — said the decision bodes well for his client and the other plaintiffs.

"Since the law went into effect, we've adhered to the mandates of the city," he said. "There is no more crime near our place, no trash, no lowering of property values. Nothing has happened to mandate the city's actions. They have to come up with more than they have come up with" to justify the 2001 amendment.”

The consolidated case is Peoples Theatres of N.Y. vs. City of New York and Ten’s Cabaret vs. City of New York, No. 181.