• story by Angelina Spencer-Crisp
Former police chief claims he was directed to target the club without probable cause and was terminated after refusing to fabricate evidence.
Amid ongoing legal contention, a judge has moved to side — at least for now — with an Atlantic Beach strip club over the South Carolina town where it is located. Judge B. Alex Hyman granted a motion for a temporary injunction brought by Crazy Horse Inc., which owns and operates Thee Dollhouse, while denying Atlantic Beach’s request for its own temporary injunctive relief. The dispute stems from a local ordinance passed by the town that directly impacts the adult venue.
Allegations surrounding the ordinance raise additional concerns. According to reporting, a city employee allegedly pressured the police chief to manufacture negative “secondary effects” after law enforcement indicated there were no existing issues tied to the club. The police chief was later terminated.
Mayor Pro Tem John David declined to comment on the ruling, according to news reports.
The court’s decision allows the business to continue operating while the case proceeds. At its core, the dispute examines whether local government actions — often justified under claims of negative secondary effects — cross the line into unconstitutional restrictions on protected expression. However, the ruling did not rely on First Amendment considerations alone.
Why the judge ruled this way
Courts have long treated certain forms of adult entertainment as “expressive conduct” under the First Amendment, even when controversial. While regulation is permitted, it must be narrowly tailored and content-neutral.
In this case, the court identified an additional — and decisive — issue. The judge ruled the ordinance “null and void” because Councilman Edward Lamar Campbell was serving unlawfully at the time of its passage. Campbell, who has been on the council since 2022, pleaded guilty to a felony in 2001, rendering him ineligible for public office in South Carolina until 2024.
Because Campbell was not legally qualified to serve, the 23-page ordinance he voted on is invalid. The ordinance imposed restrictions on hours of operation, alcohol sales, and customer interaction with semi-nude performers, among other provisions. It also authorized periodic inspections by the town manager or designated agents, with violations carrying penalties ranging from fines to suspension or revocation of the club’s license.
Legal action and broader claims
In response, Crazy Horse filed suit against the town last September. The company argued the ordinance would effectively “destroy” its business, noting it had paid Atlantic Beach more than $20 million in what it described as excessive licensing fees over the past decade, based on the expectation it could continue operating under its existing model.
The lawsuit seeks $2 million in reimbursement and alleges the ordinance was adopted without proper legal notice, relied on advice from an attorney not licensed in South Carolina, and involved intimidation tactics by local authorities.
A second lawsuit followed the next month, expanding the challenge on constitutional grounds. Filed by Crazy Horse along with two performers and the town’s former police chief, the complaint seeks to overturn the sexually oriented business ordinance entirely. It alleges the town’s underlying intent is to force Thee Dollhouse to close in order to benefit competing development interests.
The lawsuit brought by Thee Dollhouse (Crazy Horse Inc.) also alleges that the town adopted the ordinance without sufficient legal notice and relied on legal advice from Tennessee-based attorney Scott Bergthold, who they allege is not licensed to practice law in South Carolina.
Former Police Chief Carlos Castillo claims he was directed to target the club without probable cause and was terminated after refusing to fabricate evidence at the direction of Town Manager Adrian Jones. Performers Samantha Christian and Melissa Ferguson are also plaintiffs, asserting that the ordinance violates their First Amendment rights to free expression.
What this case might mean for the adult club industry
While the case is still unfolding, the ruling underscores two persistent legal themes affecting the industry: first, that procedural missteps by municipalities can invalidate sweeping regulations; and second, that efforts to regulate adult entertainment remain subject to strict constitutional scrutiny—particularly when they appear to target the nature of the expression itself.
The outcome of this case may carry broader implications for how local governments structure and enforce ordinances affecting adult businesses moving forward.
This story comes courtesy of ACE Executive Angelina Spencer-Crisp and the ACE National Newsletter.
