A federal judge has ruled it unconstitutional for New Jersey to threaten businesses with prosecution and other penalties for BYOB advertising that invites patrons to bring their own alcohol after a strip club challenged the rule on free speech grounds.

The ruling clears the way for restaurants and other businesses to tout BYO in its promotional materials.

Stiletto, a strip club with locations in Atlantic City, Carlstadt and New York, does not have a liquor license, so it sells non-alcoholic beverages and allows customers to bring their own alcohol as long as it's not hard liquor.

The club filed suit in 2017 over the state's ban on BYOB advertising, saying they wanted to encourage customers to bring their own beer and wine but had avoided such advertising over fears of prosecution.

Stiletto, through its corporate entity, GJJM Enterprises, sued Atlantic City, its police chief, the state's attorney general and the New Jersey Division of Alcoholic Beverage Control.

New Jersey law allows the consumption of beer and wine at establishments that don't have a liquor license. However, clubs and restaurants that advertise they are BYOB are subject to prosecution as a disorderly person's offense.

Further, any business owner who violates the state's Alcoholic Beverage Control regulations may be barred from operating as a BYOB.

"New Jersey's statutory ban on BYOB advertising places a content-based restriction on speech that fails strict scrutiny because it is not supported by a compelling government interest," U.S. District Court Judge Joseph H. Rodriguez wrote in his decision Monday.

The judge found that language of New Jersey's statute banning advertising "outside or inside the premises" to be unconstitutional.

"While the state may, and does, regulate conduct regarding alcoholic beverages, it has not shown that regulating the speech concerning that conduct furthers a governmental interest sufficient to override the constitutional rights at stake in this case," the 13-page ruling states.

Rodriguez rejected New Jersey's argument that it has strong interest in regulating alcoholic beverages.

"Banning speech is different from and more intrusive than banning conduct," the ruling states.

Stephen D. Holtzman, the attorney for the law firm representing the strip club, was not available for comment Wednesday.

New Jersey Attorney General's Office spokesperson Leland Moore said his office would have no comment on the ruling.

Atlantic City officials did not respond to requests for comment.

Anthony G. Attrino may be reached at tattrino@njadvancemedia.com. Follow him on Twitter @TonyAttrino. Find NJ.com on Facebook.