West Coast Clubs Join Legal Battle Against SBA Over 'Prurient Clause'

West Coast Clubs Join Legal Battle Against SBA Over 'Prurient Clause'

SAN FRANCISCO — A group of West Coast strip clubs have asked a California federal judge to grant them a preliminary injunction preventing the Small Business Administration (SBA) from discriminating against them by applying the “prurient clause” written into COVID-19 relief loan applications.

The legal action by 13 clubs in California, Oregon, Washington and Colorado is similar to ongoing efforts in Michigan, Wisconsin and Florida to obtain judicial protection for adult-oriented businesses.

The strip clubs, represented by Bradley J. Shafer of Shafer & Associates PC, argued at a video hearing yesterday before U.S. Magistrate Judge Laurel Beeler that the regulation “exceeds congressional authority under the CARES Act and is not the result of reasoned decision-making,” legal news site Law360 reported.

As XBIZ reported in March when the loans were first offered by the federal government, the “prurient” clause on the SBA loan application form replicates mid-1990s, Clinton-era language designed to discriminate against sexually oriented businesses.

The form compels applicants to declare that they do not “present live performances of a prurient sexual nature or derive directly or indirectly more than de minimis gross revenue through the sale of products or services, or the presentation of any depictions or displays, of a prurient sexual nature.”

The word “prurient” is an imprecise, obscure word that means “appealing to unhealthy sexual interests” and was used by the U.S. Supreme Court in a landmark 1973 ruling. Several members of the adult entertainment community and First Amendment lawyers have pointed out that people who do not consider their sexual expression “unhealthy” are exempt from application of the “prurient” clause.

Judge Beeler, according to Law360, “appeared sympathetic to the strip clubs,” expressing understanding that these are businesses "where people are trying to make a living, in a time where they can't make a living."

The Department of Justice attorney representing the SBA denied that the “prurient clause” was “a restriction on plaintiffs' speech at all.”

"As the government says, it is allowed to decide what it wants to fund. But I'm not unsympathetic to the [plaintiffs'] larger argument that 'we're a business too,'" Judge Beeler replied.

The clubs’ attorney argued that the government was attempting to "saddle those recovery efforts with the irrelevant ballast of decades-old regulations that impermissibly and unconscionably narrow the relief programs."

Shafer cited the precedent of “the May decision by the Sixth Circuit, refusing to pause a Michigan federal judge's order blocking the SBA from withholding Paycheck Protection Program loans from strip clubs and other sexually oriented businesses,” according to Law360.

The case is Deja Vu - San Francisco LLC et al. v. the U.S. Small Business Administration et al, case number 3:20-cv-03982, in the U.S. District Court for the Northern District of California.

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

Angela White, Madison Ivy Lead New Threesome From Brazzers

Multi-XMAs winner Angela White and Madison Ivy star with Ricky Johnson in the latest release from Brazzers, titled "Couple or Throuple?”

FTC Invites Public Comment on 'Click to Cancel' Rulemaking

The Federal Trade Commission (FTC) announced this week that it is seeking public comment on whether it should amend its Negative Option Rule to better address deceptive or unfair practices.

Taylor Wild Performs 1st DVP in Latest From New Sensations

Taylor Wild performs her first DVP with Damon Dice and Alex Legend in the latest release from New Sensations.

Melissa Stratton Headlines Latest Volume of Sweet Sinner's 'The Stepmother'

Melissa Stratton toplines the 18th volume of "The Stepmother," the latest release from Mile High Media studio imprint Sweet Sinner.

Leana Lovings Returns to Parasited

Leana Lovings stars with Aria Sloane in the latest scene from Parasited, titled “Strange Visitors.”

Samantha Reigns Stars in Latest Release From Evil Angel

Samantha Reigns stars with multi-XMAs winner Mick Blue in a new anal scene from Evil Angel.

Lucy Mochi Returns to Hentaied Pro

Lucy Mochi stars with Dolly Orchid in the latest scene from Futanari XXX, titled “Secret Sauce.”

Dakota Lyn, Addison Vodka Front Latest From Blacked Raw

Dakota Lyn and Addison Vodka star with Jason Luv in the latest release from Vixen Media Group (VMG) studio imprint Blacked Raw.

Madison Wilde Headlines 'Tempting Schoolgirls' From Reality Junkies

Madison Wilde toplines "Tempting Schoolgirls" from Mile High Media studio imprint Reality Junkies.

Show More