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As one Atlanta strip club gets PPP loan, another is allegedly planning to sue for financial relief

If precedent is any guide, there is a good chance it will win.

ATLANTA — An Atlanta adult entertainment venue is expected to head to court over being denied a loan meant to help small businesses stay afloat during the COVID-19 pandemic.

More than a half-million businesses nationwide have received Paycheck Protection Program (PPP) loans. The federal government's $660 billion program was set up to help save jobs during one of the roughest economic periods in recent history.

But an attorney told 11Alive one strip club is gearing up to sue the Small Business Administration (SBA) after it was rejected for a relief loan.

"The PPP loan program is meant to apply to all businesses without discriminating against the kind of business,” attorney Alan Begner said. “There's no reason to treat them any differently. But, again, the SBA has treated them differently around the country."

Begner would not say which strip club is planning to sue. However, if precedent is any guide, there is a good chance it will win.  Strip clubs in Wisconsin and Michigan filed lawsuits against the SBA earlier in 2020. A judge ruled the clubs cannot be blocked from the federal loans.

Meanwhile, the program did help one of Atlanta's most popular strip clubs. According to a federal database, Magic City received a $350,000 loan.

PPP loans are aimed at keeping employees on the payroll.  The program has supported 51 million jobs, according to the SBA.

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