updated 10/12/2010 2:27:12 PM ET 2010-10-12T18:27:12

The Supreme Court won't stop Utah from enacting a tax that hits only adult-oriented businesses.

The high court on Tuesday refused to hear an appeal from Denali, LLC, which wanted to overturn a decision by the Utah Supreme Court.

That court upheld a 2004 decision by the Utah Legislature to enact a 10 percent tax on sexually explicit businesses in an effort to pay for sex offender treatment. The tax covered everything a sexually explicitly business sold — admission, T-shirts and hamburgers included.

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A group of strip clubs challenged the constitutionality of the law, saying it was overly broad and violated their First Amendment rights. But the state's Supreme Court upheld the tax.

The Utah Supreme Court ruled that the Sexually Explicit Business and Escort Services tax is not a violation of First Amendment rights.

Denali runs an exotic club featuring full frontal nudity, while another company, American Bush, Inc., wants to introduce nudity into its performances.

Other states have been waiting to see the outcome of this case before trying to enact their own taxes.

The case is Denali LLC and American Bush v Utah State Tax Commission, 09-1442.

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