An 11th U.S. Circuit Court of Appeals panel indicated Thursday that the keyhole should be closed on Internet porn sites broadcasting from private residences, saying the sites constitute a business and could violate municipal zoning ordinances.

“We live in the world of reality TV. People will watch anything,” said Judge William H. Pyror, one of three judges hearing the city’s appeal.

His comments came during oral arguments in the city of Miami’s appeal to enforce municipal codes at a two-story colonial home north of downtown Miami used by, a gay sex site that provides in-home camera feeds to subscribers.

The house at 503 NE 27th St. is essentially a production studio because independent contractors provide a service for a salary, room and board, the appellate judge said.

But U.S. District Judge Marcia Cooke ruled last year in favor of cocodorm’s parent company, Flava Works, citing a 2001 ruling by the 11th Circuit that concluded such homes did not constitute adult entertainment business because the product was essentially in cyberspace.

The city argued the issue is not whether is an adult entertainment facility but that businesses of any kind are prohibited in residential zones.

James Benjamin, a Fort Lauderdale attorney with Benjamin & Aaronson representing cocodorm and Flava Works, vociferously argued the appellate court already decided the issue nearly a decade ago.

Cocodorm advertised for endowed models to live in the home and have their lives caught on Web cameras for paying customers. Flava Works receives the images from the cameras and puts them on its servers for paying customers.

Benjamin repeatedly referred to the 2001 decision when a panel ruled a home transmitting online images of copulating college co-eds did not violate Tampa, Fla.’s zoning ordinance banning adult businesses in residential areas.

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