The XBIZ Weekly Retail Round-Up

Tod Hunter

California Supreme Court Reverses Strip-Club Victory

SAN BERNARDINO, Calif. — The California Supreme Court on Thursday reversed an appellate court's decision that the city owed adult establishment Flesh Club's owners $1.4 million in lost profits. The case is headed back to trial court, and attorneys for both sides predicted they could win there.

In May 2006, a state appellate court upheld a jury's decision to award Manta Management Corp., the company that owns the Flesh Club, $1.4 million in damages for income lost during that four-year period.

But the state Supreme Court saw things differently. Justice Ming W. Chin wrote in the court's opinion that the city was not necessarily liable for the strip club's losses because a 1995 injunction against nude dancing at the Flesh Club was the result of court action, rather than city law itself. Whether the 1995 injunction would have ever been issued if correct information had been presented in Superior Court at the time is still undecided.

Last year, San Bernardino Superior Court Judge Donald R. Alvarez ordered the Flesh Club to be temporarily shut down after a case in which he found "a pervasive climate of blatant promiscuous and lewd behavior that, in the court's view, finds no sanctuary under the umbrella of First Amendment protection."

Club attorney Roger Jon Diamond said Manta Management plans to reopen the club around late June or mid-July, after that order expires.

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Doc's Back in Court

MILFORD Mass. — Doc's Sports Bar's ongoing effort to present adult entertainment has moved to Worcester Superior Court, with the pub's lawyer arguing the town has violated his client's constitutional rights.

Attorney Kenneth Tatarian wrote that the Zoning Board of Appeals acted unjustly to deny Doc's special permit request on March 13 by using "unconstitutionally vague and indefinite" bylaw provisions.

For the appeal, "We have 20 days to file an answer, which we will," said Town Counsel Gerald Moody. After Milford files its answer, the case goes into the discovery phase, followed by a court hearing.

The appeal asks the court to declare that the Zoning Board exceeded its authority in denying Doc's application and declare either that Doc's is entitled to the special permit or that it doesn't need one to have adult entertainment.

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City Council to Discuss Hustler Club Settlement

LINCOLN PARK, Mich. — Some City Council members are disagreeing with a report issued by a city-paid lawyer that states that settling with Hustler, which is planning to build a $4.2 million strip club, is a good resolution. The council will discuss the report during a teleconference with Big Rapids-based attorney Eric Williams at a public meeting within the next two weeks.

The city paid Williams $6,700 for an independent review, in which he advised the council to approve the settlement deal that would allow the construction and operation of a Hustler Club.

Although Williams advised the council to approve the settlement, already signed by a federal judge, some council members are looking to revise the agreement with the Hustler Club, which has already received building permits and has started work at the site.

"We're pretty much stuck with the fact that they have the constitutional right to set up here," Council President Thomas Murphy said. "But we have the constitutional right to institute the right rules and regulations to make sure they don't have a negative effect."

Owners of the Hustler Club agreed to shut down its nearby adult bookstore and not have all-nude entertainment, though concessions regarding adult cabaret ordinances had to be made, Williams wrote in his report.

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Topless Clubs, Suing to End New Law, Seek to Delay Enforcement

MEMPHIS, Tenn. — Seven local topless clubs sought to delay enforcement of a strict new Shelby County ordinance while they appeal a judge's refusal to issue a preliminary injunction. The clubs are seeking to keep the status quo until a trial is held on their lawsuit, in which they claim the ordinance is unconstitutional on many fronts.

The ordinance, which is set to take effect at 12:01 a.m. April 30, would ban beer sales and require dancers to wear pasties and maintain a six-foot distance from customers and other dancers when performing.

After U.S. Dist. Court Judge Bernice Donald refused to issue a preliminary injunction Wednesday, club attorneys now are asking to put the ordinance on hold for at least 21 days while they appeal Donald's ruling to the U.S. Court of Appeals for the Sixth Circuit.

The clubs say the case presents serious First Amendment issues, including vagueness and being too broad, and that "the public interest favors the protection of First Amendment freedoms."

No trial date has been set for the lawsuit.

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County Supervisors Pass Adult Zoning Regulations

VERONA, Va. — Augusta county supervisors ended months of work on a zoning revision and additions to the county code regulating adult businesses. The regulations, passed Wednesday night, require adult businesses to apply for an annual permit from the Augusta County Sheriff and pay a $300 permit fee. The business must be located a minimum of 500 feet from churches, schools and residences.

“I applaud you for keeping Augusta County the way it should be,’’ said Bill Shirley of Churchville. Shirley said adult businesses can contribute to many problems in a community, including being the root cause of abuse to women and children.

Staunton resident Andrea Oakes said that, while she does not live in Augusta County, she is grateful for the regulations. She said pornography causes “harmful secondary effects and lowers property values.”

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Adult Shop Near School Vexes Queensland

PROSPERINE, Australia — The controversy surrounding the opening of Davy Lane Adult Shop, a proposed adult store close to a school in Prosperine, has reverberated across Queensland. Acting Premier Paul Lucas said the state government would now review issues surrounding adult stores opening close to schools.

"The state government will look at ways — whether through changing state policies or strengthening council planning schemes — to regulate how close to schools adult stores could be established," Lucas said.

Roley Jackson, the director of the store, said he thought the uproar over his particular store would die down but the overall issue of adult store locations wouldn't. He welcomed the introduction of legislation to govern possible locations for adult shops.

"Without some guidelines, this sort of stuff is going to happen all the time all over the place," Jackson said. "If legislation was there, it would be cut and dried where we could and couldn't go."

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