Like a lot of businesses, some Tampa Bay area establishments shuttered in March because of the coronavirus turned to the federal government for help.
Each applied for loans through the $660 billion Paycheck Protection Program intended to help businesses keep workers employed in tough pandemic times.
Each was denied.
The businesses — Fantasyland Adult Supercenter and Charlotte’s Cabaret in Tampa, Silks in Palm Harbor and Diamond Dolls in Clearwater — are all of the adult variety. And businesses that feature live or recorded performances or sell products or services “of a prurient sexual nature,” according to the U.S. Small Business Administration, are not eligible for help from the program.
Now, along with several other adult businesses in Florida, these establishments are suing the Small Business Administration, its administrator and U.S. Treasury Secretary Steven Mnuchin in federal court in Tampa.
The recently-filed lawsuit calls the policy regarding adult businesses discriminatory and unconstitutional and says employees were “engaged in First Amendment protected expression.”
“It’s difficult to conceive how a government agency can pick and choose with our tax dollars who they give disaster relief to,” said First Amendment attorney Luke Lirot, who has made headlines representing adult businesses.
A spokeswoman for the Small Business Administration in Washington, D.C., said in an emailed response to the Tampa Bay Times that the agency “does not comment on pending litigation.”
The Merriam-Webster dictionary defines “prurient” as “marked by or arousing an immoderate or unwholesome interest or desire,” especially sexual desire.
The lawsuit contends that these businesses, which sell “adult-oriented media and products” or present “erotic entertainment” by female dancers “appeal to a healthy interest in basic human sexuality.”
The lawsuit focuses on the adult business employees who depended on a paycheck — “the people who sweep the floors, managers, bar backs, the security guys,” Lirot said. Dancers, who often are independent contractors, could apply individually for financial assistance, he said.
Paycheck Protection Program loans are forgivable if the recipients meet certain requirements regarding how the funds are spent.
Most of the adult businesses in the lawsuit have been closed since March, except for during a short period in June, Lirot said. The amounts requested average about $40,000 per business, he said.
In similar lawsuits pending in Michigan and Wisconsin, preliminary injunctions were granted by judges in favor of the adult businesses. The Florida lawsuit similarly asks for an injunction and for the businesses to be considered for the loans on their merits.
Other businesses not eligible for funds from the program include political or lobbying firms. Religious organizations and private and charter schools have received Paycheck Protection loans during the coronavirus crisis.
Lirot said a representative of the Small Business Administration recently indicated to him there were no plans to change the ineligibility of adult businesses deemed “prurient.”
He pointed out that these adult clubs and stores are licensed, operate legally and pay their taxes.
“My clients are suffering like everybody else, but they’re being told they can’t get disaster relief,” Lirot said. “That’s just fundamentally unfair.”
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