Iconic Chicago Strip Club Sues Government Over PPP Loan Delay

LOS ANGELES—It was just two years ago that AVN Hall of Famer Stormy Daniels, riding a wave of sudden fame thanks to her highly publicized lawsuit against Donald Trump, brought her act to Chicago’s Admiral Theatre — an iconic adult entertainment venue that began operating in the Windy City in 1927. Now, the Admiral — which has served as a “gentlemen’s club” since a renovation in the late 1980s — has like businesses across the country been shut down for nearly two months due to the coronavirus pandemic. But while many businesses have been able to obtain special “Paycheck Protection” loans under a new Small Business Administration program, the Admiral says it has been shut out simply because its business is erotic entertainment. As AVN has reported, when Congress passed the CARES Act, intended to provide economic relief for businesses and individuals affected by the crisis, it specifically barred loans from the Paycheck Protection Program, or “PPP,” from going to businesses that offer services and products of a "prurient sexual nature.” The provision was based on a 1996 regulation barring adult industry businesses from receiving federal loans. The Admiral has now filed a lawsuit against the SBA alleging that its PPP loan application has been consigned to limbo due to the “prurient sexual nature” clause — and that the loan delay violates the theater’s First Amendment rights to free expression. The theater on Chicago’s North Side has been shuttered since March 15 due to the pandemic. The establishment applied for a $406,565 PPP loan, to cover payroll for its 42 employees, and other expenses allowed under the program, during the period when it is unable to open for business. The issue, according to a Chicago Sun-Times report, is not the “sexual nature” of the erotic performances offered at the club — but the apparent claim by the SBA that they are “prurient,” a standard often used to determine whether a work or performance is legally “obscene,” and therefore outside of First Amendment protections. “All of the entertainment provided by the admiral is non-obscene (and thus cannot be deemed prurient),” the theater’s lawsuit states. “No entertainer performing at the Admiral has even been charged with, let alone convicted of, the crime of obscenity.” The theater says in the suit that without the PPP loan, it may suffer “permanent ruination of its business.” But according to the Sun-Times report, the lawsuit seeks not only to force the SBA to approve the loan, but to have the entire ban on sexual businesses receiving the loans declared unconstitutional. Last week, as AVN reported, a federal judge ordered the SBA to facilitate PPP loans to five strip clubs in Wisconsin. District Judge Lynn Adelman ruled that the clubs had a likely chance of success in proving that the ban on loans to “sexual” businesses is unconstitutional. Photo By Monicaadmiralx / Wikimedia Commons