Wisconsin appeals panel upholds city's denial of liquor license to strip club

The Associated Press

04.12.00

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WAUSAU, Wis. — A city may deny a liquor license to a nude dancing club on grounds there are harmful "secondary effects" when alcohol sales are added to an adult entertainment business, a state appeals panel has ruled.

The Hudson City Council had considered such things as a predicted increase in prostitution and crime and the possible depreciation of property values when it rejected the Centerfold Cabaret's application for a liquor license.

The 3rd District Court of Appeals yesterday agreed with a ruling by St. Croix County Circuit Judge Eric Lundell that upheld a denial of a liquor license for the establishment.

It's the latest in a series of legal battles in western Wisconsin between local governments that do not want the strip clubs and the clubs' owners, who have mostly warded off attempts to ban them by arguing new laws are unconstitutional.

In June 1998, the state Supreme Court ruled nude dancing in taverns was a constitutionally protected form of free speech and could not be outlawed by a municipal ordinance enacted by Trenton, a northwestern Wisconsin town.

The high court ruled 5-2 in striking down the law, saying it was broad enough to outlaw other depictions of nudity, such as works of art or television programs.

According to court records in the appeal decided yesterday, East of the River Enterprises II, a Minnesota company, purchased the former Sand Bar in downtown Hudson in January 1999, applied for a liquor license and began operating Centerfold Cabaret, which featured nude dancing.

The liquor application created a flurry of opposition from people for a variety of reasons, including that the business amounted to "sexual exploitation of young women on our main street" and harmed neighboring stores, court records said.

About a year ago, the City Council unanimously passed a resolution denying the liquor license because it was contrary to the interests of its citizens and would be "detrimental to the public health, safety and welfare" of the city's residents.

The council cited the "adverse secondary effects" of adding alcohol to an existing sexually oriented business.

Shortly after that vote, the council passed a new ordinance that banned nude dancing in businesses with a city liquor license.

The three-judge appeals panel rejected Centerfold Cabaret's argument that so-called secondary effects could not be considered in licensing decisions.

The city presented sufficient evidence to back up its decision, relying on 16 studies in other cities that showed a correlation between crime, neighborhood deterioration and decreased property values when liquor was involved in a sexually oriented business, the appeals court said.

"The totality of the evidence presented to the council reasonably supports its finding that adverse secondary effects can be observed when liquor is served at adult entertainment establishments," the panel said.

Centerfold Cabaret's attorney, Randall Tigue, said yesterday's decision likely would be appealed.

The business no longer features nude dancing but operates as an adult bookstore, Tigue said.