Mary Spicuzza

Milwaukee Journal Sentinel

A strip club may open in downtown Milwaukee under a deal being negotiated by city officials and groups who've been fighting for years to open a club in the heart of the city.

The agreements involve strip club owners dropping lawsuits they have filed against the city in exchange for city officials agreeing to hold a hearing this month to consider opening a club at 730 N. Old World Third St.

The agreements, which appear to have been prepared by the City Attorney's Office, would involve Silk Exotic owners, known as Six Star Holdings LLC, Boardroom Entertainment MKE LLC, and Roaring 20's Management LLC or PPH Properties I LLC. Each of those groups has previously sought to open clubs downtown. None of the three agreements obtained by the Journal Sentinel had yet been signed.

"The city agrees it will not enact legislation that substantially burdens the operation of such a gentlemen's club for a period of 6 years from the date this agreement is fully executed," the agreements read.

City officials would not, for example, effectively ban "champagne rooms" by designating a minimum room size in which erotic dancers perform, nor would they require the dancers to remain at a certain distance from patrons while performing, require them to perform on a stage, or prohibit "any touching (other than touching that is already prohibited by state law)," the agreements say.

Repeated attempts have been made to open a strip club at the Old World Third St. location, which was previously Rusty's Old 50.

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Last year, city officials approved a nearly $1 million payment to Silk Exotic owners who have been fighting for years to open a new club downtown.

Jon Ferraro of Silk was indicted in California in 2015 as part of a sprawling racketeering case targeting the Russian mob, according to federal cellphone tracking warrant.

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Rusty's Old 50 was previously run by Diane Buzdum, and her business partner, Robert Smith, under the name Boardroom Entertainment MKE.

Rusty's previously ran into trouble with the law when Milwaukee police officers found dancers, many of whom were wearing just "pasties," underwear and high heels, as well as vertical poles for dancing, according to a police report. The poles were later removed, additional police reports show.

The agreements would be subject to approval by the Milwaukee Common Council. A council committee is expected to meet in closed session Thursday to review the issue.

Adam Stephens of the City Attorney's Office and Council President Ashanti Hamilton could not be reached for comment Wednesday.

If signed, the agreements would settle the disputed claims and prevent the three groups from suing in the future.

"By entering into this agreement, the city does not admit any liability to plaintiffs for any of the claims asserted in the case, and the payments made under this agreement shall not be construed as an admission of any such liability," the agreements read.