Editorial: The Hidden Danger of the Recession

GOD'S COUNTRY — Once upon a time, a long time ago - way back in the late 1980s! - a nasty group of politicians and government attorneys tried to fuck the adult industry - specifically, the adult mail-order business, which for many people in the "heartland" was the primary source for their adult video, magazine and novelty needs.

PHE, Inc., better known as Adam & Eve, was a fairly new company when it got raided by 37 sheriff's deputies, federal postal inspectors and agents from the North Carolina State Bureau of Investigation on May 29, 1986. Eventually, PHE was charged in Alamance County with selling obscene material, but despite intense pressure from the U.S. Department of Justice and the U.S. Attorney for the Eastern District of North Carolina Sam Currin, the company was acquitted of all charges...  and Reagan's Attorney General Ed Meese wasn't going to have any of that!

"We must regain momentum after the Adam & Eve verdict and come with as many indictments as possible," Currin wrote just four days after the Alamance verdict. "We also need to locate some other district attorneys who will prosecute Adam & Eve in their districts. Bob Thomas in Hickory is one who I believe will do so. Perhaps Peter Gilchrist will also prosecute. We need to get state indictments of Adam & Eve in some other districts. Contact Utah and urge them to proceed with their indictments as soon as possible. Also discuss with [National Obscenity Enforcement Unit head] Rob [Showers] whether he wants the Middle District [of North Carolina] to do a RICO [Racketeer-Influenced Corrupt Organizations charge] on Adam & Eve. If so, he needs to work the RICO case out of Washington. I doubt anyone in the Middle District has the sense to do it."

Currin, who was also targeting North Carolina retailers, later told the Raleigh News and Observer, "Some of these stores will voluntarily close down rather than face prosecution. Either way we win."

And that was the plan.

"[T]he idea was to prosecute the alleged pornographers in several conservative regions of the United States," stated U.S. District Judge Joyce Hens Green in an interview (.pdf), "including, among others, Idaho, Utah, and Montana, at the same time, in order to put them out of business, of course, since who can defend simultaneously in two or more jurisdictions? Prosecution in this manner not only limited, but prevented due process."

It was Judge Green herself who thwarted the Justice Department's scheme when she ruled in PHE, Inc. v. U.S. Department of Justice - and in the process, she noted later that the defense had "unearthed extraordinary and hidden measures taken to investigate, to explore, to wiretap pornographers. Only the record can truly reflect the shocking depth of matters that had transpired."

Any of that sound familiar?

But while the Justice Department can no longer drive adult moviemakers and retailers into bankruptcy through its multiple prosecution strategy, the current economic recession seems ready to do that job for them, even if mainly at the local level.

"Convicted on obscenity charges, Virginia store owner says it's not worth the hassle to continue legal fight ," wrote a staff reporter for the Staunton, Va. News-Leader. "During the last year and a half, Rick E. Krial spent $150,000 defending his porn business in court. He says it's not worth it anymore."

Recall that Krial was charged with selling two "obscene" movies, was convicted of one and acquitted of the other in a trial marked by extremely prejudicial conduct by the prosecutor, so his chances of winning on appeal were pretty good - but at what cost? Considering that his sentence was simply a fine, and considering how long it would take his store to recoup $150,000 in profit, it's not surprising that Krial folded.

Similarly, Greg Sakas, who was acquitted of selling a "controlled substance" (it wasn't) and of violating adult zoning laws at his location in New Bern, N.C. after just three and a half hours of testimony, is about to close his store in nearby Wilmington because, he told AVN, "I just don't have enough money left to fight it. And besides, the store's hardly making a profit now anyway, so to fight it would just be throwing good money after bad."

The fact is, with unemployment officially topping 8% (and if those who've given up looking for work, or were once full time and are now part-time are included, over 14%), adult retailers are hurting. Somehow, jackoff material and movies to get hubby or wifey "in the mood" are taking a back seat in the wallet to food, shelter and gasoline ... not to mention all the free (and pirated) content that can be found online.

But what that means is that retailers will be increasingly less able, financially, to fight local prosecutors hell-bent on ridding their towns of "that vile pornography" - and that's going to cause problems right up the revenue stream to distributors and producers, who'll have less outlets for their merchandise - making them too more vulnerable to litigation bankruptcy.

All we can say is, let's hope the economy turns around quickly, for everybody's sake.