Texas' Tax on Strippers' Latex 'Clothing' Is Gone for Good

HOUSTON—Quick quiz: What's the effective difference between a woman wearing a very tight shirt with no bra, and a woman with no shirt (or bikini top) whose breasts are covered with several layers of opaque liquid latex? The logical answer is, of course, "no difference"—but that hasn't stopped the state of Texas from trying to put yet another tax on adult nightclubs, something it's been trying to do since at least 2007—and each time it tries, a court strikes it down as a content-based restriction on speech. The most recent example of that has been the lawsuit begun by Texas' Comptroller Glenn Hegar and most recently challenged by the Texas Entertainment Association, a group of nightclub owners and supporters who seem to spend a lot of their time fighting unconstitutional legislation aimed squarely at their businesses. The problem all stems from that 2007 law, the Sexually Oriented Business Fee Act, which initially imposed a $5 entry fee on all adult nightclub admissions—another clearly unconstitutional speech restriction. The Texas Third District Court of Appeals thought it was as well, and struck it down in June of 2009—so the legislators promptly replaced it with a gross receipts tax on any adult business that charges an admission fee to enter. Of course, that let out adult bookstores, adult video stores and for some reason even adult movie theaters, but guess what's left? (The answer will be left as an exercise for the student.) Anyway, that tax didn't survive either, for the same speech-restrictive reason, but the Texas pols weren't done yet. In January of 2017, Hegar created a rule based on the Sexually Oriented Business Fee Act (SOBFA), which failed to define what the word "clothing" meant when applied to dancers on stage. For Hegar, that meant that he could define the word pretty much any way he liked—and what he liked was the idea that since many Texas club dancers did their acts with bikini bottoms but covered their breasts in liquid latex, such "clothing" wasn't clothing at all but a form of nudity—and therefore eligible to be taxed under the SOBFA because of the "nudity." Unfortunately for Hegar, the U.S. District Court for the Western District of Texas, in a ruling handed down last February in Texas Entertainment Association v. Hegar, found that, sure enough, Hegar's rule was a content-based restriction on free speech, in part because it was "directed at the essential expressive nature of latex clubs' business, and thus is a content-based restriction." But losing at the federal district court level didn't stop Hegar, who subsequently pressed a nearly identical case before a state court in Houston, and this time, his opponent was Texas BLC Inc., a trade organization representing "bikini/latex clubs." The new lawsuit, according to an article on Law260.com (subscription required), would have allowed Hegar to levy "a $5 per patron tax on sexually oriented businesses that also serve alcohol." Quick checklist: Do adult bookstores serve alcohol? No. Do adult video stores serve alcohol? No. Do adult movie theaters serve alcohol? No. Guess who does? In any case, the Houston trial court denied Hegar's attempt to implement his new rule, and because of the district court ruling in the Texas Entertainment Association case, the panel of justices on Texas' First District Court of Appeals deemed Hegar's case to be moot, since the basic facts had already been decided by the federal court. "Because the federal district court's decision enjoins the comptroller from collecting [sexually oriented business] fees from bikini-latex bars, including the members of Texas BLC, there is no live controversy between the parties that will actually be resolved by a determination of the validity of the comptroller's [sexually oriented business fee] rule," the panel wrote. But you know what they say, Glenn: If at first (or third or fourth) you don't succeed, try, try again!