text: New York's highest court will consider legal arguments by a strip club on whether nude dancing is an art and deserves a state tax exemption as such. 
   
   The case set for oral arguments Wednesday involves Nite Moves, an adult entertainment club in suburban Albany that contested a tax bill of more than $124,000 following a 2005 audit. 
   
   Tax officials say sales taxes were paid on the club's non-alcoholic drinks, but are also owed on admission and so-called "couch sales," where patrons pay for private or lap dances. 
   
   Nite Moves claims the dances are exempt under state tax law as "live dramatic or musical arts performances." The exemption also applies to theater or ballet. The club is relying on testimony from a cultural anthropologist who has studied exotic dance and visited Nite Moves. 
   
   W. Andrew McCullough, an attorney for Nite Moves, said the impact of the eventual court ruling probably won't be widespread because most establishments featuring exotic dancers sell alcohol where other tax rules apply. 
   
   An administrative law judge previously agreed with Nite Moves, saying that "the fact that the dancers remove all or part of their costume ... simply does not render such dance routines as something less than choreographed performances." 
   
   But the state Tax Appeals Tribunal said the club didn't present sufficient proof that it qualifies for the exemption, and a mid-level court upheld the tribunal ruling last year. 
   
   "In our view, there can be no serious question that _ at a bare minimum _ petitioner failed to meet its burden of establishing that the private dances offered at its club were choreographed performances," the Appellate Division court ruled. The four justices also found "no merit" to the club's constitutional claims. 
   
   The appellate court also noted that the club dancers are not required to have any formal dance training and that the anthropologist didn't see any of the dances done in private rooms. 
   
   Cary Zeitner, a spokesman for the state Department of Taxation and Finance, said the agency is not aware of any other cases in state court similar to the Nite Moves case. 
   
   The court typically takes about a month to issue a decision. ||||| The answer may seem obvious, but it has attorneys in Albany arguing: How is a ballerina different from a pole dancer? 
   
   New York's highest court, the Court of Appeals, will hear arguments on Wednesday in a case pitting the state's Department of Taxation and Finance against a strip club called Nite Moves that is situated about 15 minutes from the state Capitol. 
   
   The issue: whether the club's $11 cover charge and $20, three-minute lap dances are subject to an 8% sales tax. 
   
   The seven-judge panel is being asked to interpret an obscure part of the state tax code that exempts sales-tax charges for "dramatic or musical art performances." The state wants the court to prevent strip clubs from using the same sales-tax exemption as the New York City Ballet. 
   
   New York Attorney General Eric Schneiderman's office is representing the tax department. While noting that some "pole tricks" are "difficult to perform," state attorneys wrote in a court brief that some Nite Moves dancers "have no prior dance experience at all and simply learn moves from other dancers during slow shifts over time." 
   
   Such a dancer isn't "engaged in a genuine choreographic dance performance when she removes her clothing," the brief said. "In fact," it added, "some patrons paid the admission fee simply to come in and enjoy a conversation with the dancers." 
   
   Representing Nite Moves is Andrew McCullough, an Albany native who is one of the nation's premier attorneys for adult-themed businesses. The tax man, he said, is behaving too much like a dance critic. 
   
   "If they've spent hours and hours practicing and learning this stuff, and if they can flip around and do amazing moves, why aren't they choreographed dance performers?" Mr. McCullough said. 
   
   "Under their code," said the club's CFO Stephen Dick, "Eric Clapton, who didn't go to school to learn guitar, his performances would be taxable." 
   
   The attorney general's office declined to comment. 
   
   Nite Moves opened in 1997 in Latham, N.Y., and features cushy barrel chairs, dark wood, brass sconces and framed erotic artwork. The establishment serves nonalcoholic drinks, allowing dancers to perform nude. 
   
   The legal fight started in 2005 when the state audited the club's taxes and found that it owed about $400,000 for not charging sales tax on the cover and dances. The club challenged the audit in administrative tax court, and an administrative law judge sided with the club in 2008. On appeal, a tax tribunal struck down that decision; an appeals court upheld the tribunal's ruling. Last year, the Court of Appeals agreed to hear the case. 
   
   Wednesday's oral arguments will pit the attorney general's office against Mr. McCullough, who describes himself as a "teetotaling Mormon." 
   
   "I know I'm not supposed to be watching naked dancers," he said, though he goes to clubs often anyway. 
   
   Mr. McCullough, 64 years old, spends most of his time in Utah, where he operates a law practice—right above a lingerie and novelty boutique—and represents other adult-entertainment clients. In his spare time, he is making a second bid for Utah attorney general as a Libertarian Party candidate. He received 4% of the vote in 2008. 
   
   Mr. McCullough said Nite Moves isn't a garden variety gentlemen's club. 
   
   "Nite Moves girls…work at it, and when you see the finished product, you can't help but say, 'These girls are good,'" he said. 
   
   Don't take his word for it. He recruited expert witness Judith Hanna, a University of Maryland anthropologist and dance theorist who has observed dancers at hundreds of clubs in her research. After watching a DVD of Nite Moves dancers, she testified before a lower court that the routines displayed "choreographic patterns of exotic dance," according to court papers. One dancer, she said, executed 61 moves in the course of three songs. 
   
   The New York case represents a trend for strip clubs, as cash-strapped statehouses crack down on a target with few friends in government. 
   
   In Illinois, Gov. Pat Quinn just signed a bill forcing strip clubs to pay a $3-per-customer fee to help fund rape crisis centers. Texas and Utah have imposed a similar "pole tax." At least five other states, including California, are weighing similar measures. 
   
   Nite Moves is getting a helping hand from another tax department target, the proprietors of "Larry Flynt's Hustler Club," whose lawyers filed a friend-of-the-court brief in support of Mr. McCullough's petition. 
   
   "Whatever happens here is going to frame the debate going forward," said Michigan-based Bradley Shafer, an attorney for the Hustler club in Manhattan. 
   
   But other allies haven't stepped forward. "No one is going to stand up for the rights of a strip club," Mr. Dick said. "We're always an easy target." 
   
   Write to Jacob Gershman at jacob.gershman@wsj.com
target: – Nude dancing is an art and should be tax-free, just like ballet performances, according to a strip club in upstate New York. Lawyers for Albany's Nite Moves will appear before the state's highest court today to argue that it doesn't need to pay sales tax on admission fees or lap dances, reports the AP. The club claims the dances are exempt under part of the tax code covering "live dramatic or musical arts performances"—and it has a cultural anthropologist as an expert witness. Before a lower court, the anthropologist testified that she had observed "choreographic patterns of exotic dance" at the club, noting that one dancer executed 61 moves in the course of three songs, the Wall Street Journal reports. The tax department, however, argued that a nude dancer is not "engaged in a genuine choreographic dance performance when she removes her clothing." Whatever the court decides may not have much impact on other establishments, since Nite Moves only serves non-alcoholic drinks, putting it under a different part of the tax code than most other strip clubs.