An MPAA-rating appeals board has upheld the NC-17 tag it recently gave to “Kids,” the chronicle of a group of urban teenagers that’s laced with sex, drugs and profanity.

Eamonn Bowles, chief operating officer of Excalibur, the film’s distributor and the man who lobbied the Motion Picture Assn. of America for the softer R rating, said he has decided to release the film unrated rather than edit the film or accept the NC-17 tag.

Constitutional law attorney Alan Dershowitz argued before the appeals board July 12 on behalf on Excalibur, a firm formed by Miramax Films founders Bob and Harvey Weinstein. The well-known attorney called the board’s decision “a disempowering of every parent in America.”

Dershowitz claimed that the vote to maintain the NC-17 rating was by a minority and characterized “a very close vote” as a “moral victory” for his side.

“It was clear we changed some minds,” said Dershowitz of the appeal, which needed a two-thirds majority to succeed.

He did not explain how he knew, since the appeals board vote is a secret ballot. Sources at the hearing said conversations with Dershowitz about the film were kept to a minimum.

Dershowitz asserted the board’s failure to give the film the more lenient R rating will prevent parents from taking their children to the film, which could open a meaningful discourse about unprotected sex and drug use.

Bowles said “Kids” was never slated for a wide release, but he expects to encounter some resistance over the exhibition of an unrated film.

Dershowitz was joined during the appeals session by Sassy magazine founding editor Jane Pratt.

Richard Mosk, chairman of the Classification and Ratings Administration of the MPAA, argued on behalf of the appeals board.

The Weinsteins formed Excalibur with their own personal funding exclusively to release “Kids, ” because Miramax’s owner, Disney, is prohibited from releasing unrated films.

Though there are no plans to release more films under the Excalibur banner, sources at the company indicated that future pickup deals of potentially controversial product could be funneled through the new entity.

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