Milwaukee Must Pay Strip Club Owner $435K, Court Rules

Milwaukee Must Pay Strip Club Owner $435K, Court Rules

CHICAGO — The 7th U.S. Circuit Court of Appeal on Wednesday upheld an award of $435,000 in damages against the City of Milwaukee in a case involving two strip clubs.

The appeals court, 3-0, ruled that Jon Ferraro, who numerous adult entertainment businesses — Six Star Holdings and Ferol LLC — is entitled to damages for lost profits because now-repealed city licensing requirements blocked the opening of two new nude strip clubs in violation of the First Amendment.

Ferraro applied for the required liquor licenses, tavern amusement licenses, and theater licenses — but his applications stalled in City Council and later denied.

At the time, Milwaukee’s city leaders were swayed by members of the public, who complained that the clubs would produce unwanted “secondary effects” on the neighborhood, including a disorderly clientele and increased crime, and that they would drive away other businesses.

“Following this setback, Ferraro reevaluated his options. He began preparations to open a dry adult club at one of his locations,” the appeals court wrote in its opinion. “For market research, he visited several other dry clubs — one near Appleton, Wisc., and others in Las Vegas.

“He began calculating whether a Milwaukee-area dry club could be profitable based on the financial data from another Milwaukee-area club he owned. He identified managers from his other establishments who could move to his new club, and he contacted a parking service to arrange for valet parking at the new club.

“But his lawyer interrupted his preparations with more bad news: although he would not need a liquor license and tavern-amusement license, he would need either a theater license or a public-entertainment club license to operate a dry club that featured nudity.”

As Ferraro’s business plans evolved, so did his legal strategy. And he ended up filing several suits against the City of Milwaukee.

Ferraro, who owns other strip clubs elsewhere in Wisconsin, claimed that the licensing requirements violated the businesses' First Amendment rights, arguing that City Council's dislike of strip clubs was no legal reason to deny a permit.

A lower court found for the City of Milwaukee with respect to the challenges to the liquor licensing ordinance, because the city denied the license on the reasonable grounds that it would create secondary effects.

But the lower court also granted Ferraro $435,000 in damages related to the theater license application, finding that without this ordinance, he would have opened dry strip clubs in Milwaukee.

The 7th Circuit on Wednesday upheld the damages award for lost profits.

“It is fairly traceable to the unconstitutional ordinances — [Ferraro] alleged that, but for the ordinances, it would have engaged in protected speech, and a jury ultimately found this to be true,” the appeals court wrote. “Damages redress the harm that [Ferraro] suffered by replacing the lost profits [Ferraro] would have earned if it had been able to open its club at the planned time.”

In closing, the 7th Circuit judges said: “The city is fighting a losing battle over a regime whose time has passed.”

View ruling

Related:  

Copyright © 2026 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

SWR Data Announces 2026 'State of Creator' Winter Report

Adult industry market research outfit SWR Data has announced that it will release data from its annual State of the Creator survey at an XBIZ LA workshop, taking place at the Kimpton Everly Hotel.

Holly Randall Launches Marketing Firm, Signs Stripchat Deal

Holly Randall has launched her new marketing firm, Holly Randall Agency, and signed the agency’s first deal with Stripchat.

Agatha Vega Returns to Dorcel for 'Agatha's Secrets'

2024 Euro XMAs Performer of the Year Agatha Vega stars in the new Dorcel title “Agatha’s Secrets.”

2026 XBIZ Conference Speaker Lineup Announced

XBIZ is pleased to announce the release of the full speaker lineup for XBIZ 2026, the latest edition of North America’s largest adult industry conference, set to take place Jan. 12-15 at the Kimpton Everly Hotel in Hollywood.

Sarah Arabic, Ashlyn Peaks & Cali Sweets Star in Latest 'All-Girl Massage'

Sarah Arabic, Ashlyn Peaks, and Cali Sweets star in the latest installment of Adult Time series "All-Girl Massage."

Alexis James Makes Her Elegant Angel Debut

Alexis James has made her debut for Elegant Angel in a new scene titled “Fit For Anal.”

Clara Mia Leads Dorcel's 'Climax #5'

Multi-Euro XMAs winner Clara Mia headlines the latest release from Dorcel, titled “Climax #5.”

Dreamcam Rolls Out Browser-Based Passthrough VR

Dreamcam has introduced passthrough VR to its livestreaming platform.

2026 TEAs Nominees Announced

Nominees for the 2026 Trans Erotica Awards (TEAs), presented by Clips4Sale, have been announced. The ceremony will return to the Avalon in Hollywood on Sunday, March 8.

JD Directs New Arya Santana Showcase

Evil Angel has released director JD’s latest showcase, titled "Bad Behavior: Arya Santana."

Show More