The Fox Cinema on Main Street near Kingsway has been screening hardcore pornography for the last 25 years. The Fox Cinema on Main Street near Kingsway has been screening hardcore pornography for the last 25 years. (CBC)

Vancouver city councillors have decided not to revoke the business licences of the city's last movie theatre featuring porn, despite complaints X-rated activity inside is spilling out onto the streets.

The Fox Cinema on Main Street near Kingsway has been screening hardcore pornography for the last 25 years, but during two days of hearings in front of the business licence panel this week, undercover police officers testified they witnessed patrons of the Fox engage in public sex acts in the cinema's seats.

Const. Robert Hirst gave his account of a world many people would probably rather not know about.

"As he sat down, he put his hand into his fly, pulled out his genitalia, began masturbating," Hirst told the panel. "At that point, I climbed over the back of my seat and resumed standing, continuing observations."

The owners of the nearby Lark boutique argued the bad behaviour happening inside was also spreading outside, including public nudity and prostitutes conducting business in nearby doorways.

But the Fox's owner, Lisa Huang, said her business was unfairly targeted by police after trendy salons and boutiques moved into the Mount Pleasant neighbourhood and complained about her business.

"They just try to collect evidence to support somebody's opinion," Huang told the hearing.

Huang's lawyer, Stuart Gray, agreed.

"Let's remember what the complaints were," he said. "How did this happen? This happened because a neighbour didn't like being next to the porn theatre."

At the end of the hearing, the three councillors who made up the panel agreed, saying there was no conclusive evidence the theatre was bad for the neighbourhood and decided not to revoke Huang's licences.

The councillors did put conditions on the licences, however. Staff will now have to patrol the theatre every 30 minutes and Huang will have to meet with the local Business Improvement Association to iron out any wrinkles in their relationship.