GEORGIA ASSOCIATION OF CLUB EXECUTIVES, INC. v. STATE OF GEORGIA (Two Cases)

A trade group representing Georgia strip clubs, the Georgia Association of Club Executives, sued the state over a law requiring adult entertainment establishments that serve alcohol and feature nude or nearly nude dancing to pay a tax of one percent of gross revenue or $5,000, whichever is greater. The money funds a state program helping children who have been sexually exploited. The club association argued the tax targets the content of nude dancing and should face the toughest constitutional test, and that even under a lesser test it goes too far and is written so broadly it could sweep in unrelated businesses like hotels. A Fulton County judge sided with the state, and the clubs appealed to the Supreme Court of Georgia. The court agreed with the trial judge, holding the tax addresses secondary harms like child sexual exploitation linked to these venues rather than punishing the dancing's message, that it passes the applicable First Amendment test, and that the law's wording is not unconstitutionally broad.

The tax is content-neutral because it targets the secondary effects of combining alcohol and nude dancing, such as child sexual exploitation, rather than the dancing's message, so it need only satisfy intermediate scrutiny; the tax satisfies that test, and the law's definition of a covered establishment is not unconstitutionally overbroad.

Georgia strip clubs that serve alcohol must keep paying the tax, which funds services for sexually exploited children. The ruling also gives Georgia lawmakers a legal roadmap for taxing (rather than only banning) businesses tied to alcohol and nude entertainment, and clarifies how much evidence the state needs to justify such measures.

Affirmed

1. The court explained that a law is content-neutral, meaning it does not target speech based on its message, if the government's purpose is to address 'secondary effects' like crime rather than to suppress the message itself; because the legislature said it aimed at harms like child exploitation linked to these clubs, not the dancing's erotic message, the tax is content-neutral.
2. Because the tax is content-neutral, the court assumed (without deciding) it need only pass 'intermediate scrutiny,' a more lenient First Amendment test than strict scrutiny that asks whether the law serves an important government interest unrelated to suppressing speech and burdens speech no more than necessary.
3. Applying that test, the court found the state's interest in funding help for sexually exploited children, paid for by the industry linked to that harm rather than the general public, was an important interest supported by legislative studies and testimony connecting adult entertainment venues serving alcohol to child sexual exploitation.
4. The court held the tax's burden on the dancers' expression was minimal and closely tied to that interest: clubs can avoid the tax entirely by not serving alcohol or not featuring substantial nudity, and all the money collected funds the stated purpose, so the law is not required to use the least restrictive method available.
5. On the overbreadth claim, the court concluded that the law's phrase 'consists of' nude or substantially nude entertainment requires that such content be an essential, not incidental, part of a venue's offerings, so the law does not sweep in hotels, theaters, or mainstream shows with brief nudity, defeating the claim that it reaches too much protected activity.

• adult entertainment tax
• strip club regulation
• First Amendment
• nude dancing
• child sex trafficking fund