This nice book claims this is true:
Ross Petras, Kathryn Petras - Stupid Sex-Main Street Books (1998)
On Legal Technicalities
A Vancouver nightclub was in trouble with the British Columbia Liquor Control Board due to the nude dance act it featured.
The owner learned that he had broken the law—not because he had nude dancers at his club, but because he didn’t have an orchestra of at least three pieces.
More than willing to live up to the letter of the law, the nightclub owner hired three musicians to play while the nude dancers danced … three nude female musicians, to be exact.
It was just fine with the board. As one spokesman noted: “As long as he has three musicians, how they are attired is of no concern to us.”