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 © 2025 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

Matthew Meier Talks Confidence, Chemistry and Acclaimed Craft

Matthew Meier is riding high. At the 2025 Euro XMAs, he not only took home a Best Sex Scene trophy for the second year in a row, but was also crowned Male Performer of the Year.

Penthouse Names Liana Love November's 'Pet of the Month'

Penthouse Magazine has named model Liana Love as Pet of the Month for November.

Blake Blossom, Scarlet Skies & Sky Wonderland Star in Blacked Orgy

Blake Blossom, Scarlet Skies, and Sky Wonderland star with Isiah Maxwell, Jax Slayher, and Hollywood Cash in the latest orgy release from Vixen Media Group (VMG) studio imprint Blacked.

Eve Sweet on Turning Sexual Energy Into Crowning Glory

‘I was literally crossing my fingers,” says Eve Sweet, recalling the moment just before her name echoed through the Theater Amsterdam and she walked onstage to be crowned 2025 Euro XMAs Female Performer of the Year. “I was thinking, ‘Please, I worked very hard for this.’”

Octavia Red Makes Wicked Debut in 4th Installment of 'Viewer Discretion Advised'

Octavia Red has made her Wicked Pictures debut in the fourth scene from the studio's latest feature, "Viewer Discretion Advised."

OnlyFans Institutes Criminal Background Checks for US Creators

OnlyFans will screen creators in the United States for criminal convictions, CEO Keily Blair has announced in a post on LinkedIn.

Kimmy Kimm Lands Cover of Playboy Sweden

Playboy magazine’s Swedish edition has selected Kimmy Kimm as the cover model for its Nov. issue.

Lilly Bell Stars in Latest From Girlsway

Reigning XMAs Girl/Girl Performer of the Year Lilly Bell stars with Blake Blossom in “Roleplay with Me: The Case of the Canceled Party,” from Girlsway.

Madison Morgan Performs 1st Anal, Makes Elegant Angel Debut in 'Big Wet Asses 33'

Madison Morgan performs her first anal scene and makes her Elegant Angel debut in the thirty-third volume of "Big Wet Asses."

Zariah Aura, Yhivi Front Latest From TransSensual

Zariah Aura and Yhivi star in the latest scene from Mile High Media studio imprint TransSensual, titled “Two Slutty Clowns.”

Show More