Texas Strip Clubs Sue State Over New Surcharge
$5 Cover a Discriminatory Tax, Plaintiffs Say
Posted Dec 13th, 2007 05:47 PM by Peter Warren
— A new cover charge of $5 being imposed by the state of Texas upon all strip clubs beginning Jan. 1 violates the club operators' free speech rights and unfairly implies a connection between their patrons and rape, according to a suit filed last week in Travis County.
As reported by The Dallas Morning News
, the cover charge, approved last spring, is intended to go toward funding sexual assault prevention and health care for the uninsured. But the plaintiffs in the suit — the Texas Entertainment Association, which represents more than half of the nude bars in the state, and Karpod, Inc., which operates a club in Amarillo — argue that it imposes a discriminatory tax on their businesses, as other sexually oriented businesses such as nude modeling studios and adult video stores are not being targeted.
"Exotic nude dancing is protected speech under the First Amendment," the lawsuit states. "[The cover charge] singles out income derived from protected speech for a burden the state places on no other income."
The authors of the bill said it is not meant to suggest that patrons of strip clubs are inclined to perpetrate sex crimes, but simply was designed as a means of generating revenue for under-funded programs.
Free speech attorney Jeffrey Douglas told AVN that the bill is highly unconstitutional, saying, "To understand the fundamental unconstitutionality of this statute, all one has to do is imagine the Texas legislature deciding to put a five-cent-per-newspaper sale tax on whatever newspapers they don't like. So at the beginning of the legislature, they go through and they say, 'The Dallas Morning News
, they've been real unpleasant to us, we'll charge a nickel for each one of those. And we'll give half that money to victims of sexual assault, a quarter of the money to [the] uninsured, and we'll put another quarter of the money into a fund to help victims of slander.'
"You cannot single out protected speech for special taxation for any reason," Douglas continued, "because, as has been said for hundreds of years, the power of tax is the power to destroy. The courts have been consistent about this for more than at least 80 years."
The most egregious argument on the state's behalf, Douglas said, was Rep. Ellen Cohen's statement to the Morning News that she "didn't hear from" the bill's opponents while it was being legislated.
Describing that comment as a "moment of marvelous absurdity," Douglas said, "A, it's false, and B, who has the responsibility for reaching out to an entity that you are taxing? One normal person might think it's the responsibility of the legislative body that's deciding to enact the taxation. What kind of morals does it take to tax a business without asking the business what kind of impact that tax would have? It would be like some kind of taxing agency in the state deciding to put a 30 percent tax on the state legislature and complaining that the legislators didn't come forward and tell them what kind of impact it had on them.
"The adult industry has been a doormat for legislators for far too long," Douglas concluded. "The industry has matured substantially, there's a very effective lobbying entity in Texas, as there are in many states, and this legislation is shameful, and I am confident it will be short-lived."