-By Eleftheria Parpis

Late last month, as the Commercial Closet Association -- a non-profit organization promoting the positive use of gay, lesbian, bisexual and transgender references in mainstream media -- celebrated its fourth annual Images in Advertising Awards, the ad industry was under fire for ads that were at best misunderstood and at worst homophobic.

At the awards show, Levi's won best commercial with "Change," a spot from Bartle Bogle Hegarty, New York, that featured alternate endings: one showed a man walking off with a woman; another a man walking off with a man. Ads such as these "are still very rare," says Michael Wilke, executive director of Commercial Closet, which is based in New York.

In fact, several recent controversial ads demonstrate that gay stereotypes and jokes are still an option for some advertisers. Two have made the news of late.

A Snickers commercial, produced by AMV BBDO, London, for the U.K. market, was recently pulled by parent company Mars amid complaints from gay-rights advocacy groups. The Human Rights Campaign, for instance, criticized the commercial -- which showed '80s icon Mr. T shooting candy bars at an effeminate speed walker while admonishing him to "Get some nuts!" -- as promoting negative gay stereotypes.

Ironically, the same agency produced a U.K. ad for Heinz Deli Mayo showing two men kissing that was pulled off the air in June; TV viewers had complained that the ad was offensive and unsuitable to be seen by children.

In the U.S., a Nike basketball print and outdoor campaign for its Hyperdunk basketball shoe out of Wieden + Kennedy, Portland, Ore., was pulled. The ads showed players' faces in between the legs of opponents above them dunking balls, with headlines including, "That Ain't Right."

The fact that these ads were taken off the air shows that "homophobia as a punch line is on its way out," says Wilke.

Both marketers responded quickly, with Nike emphasizing its commitment to diversity and Mars stressing the spot was meant to be fun, not offensive.

"The Mr. T [ad] completely perpetuates a myth of masculinity," says Whitney Pillsbury, a cd at The Kaplan Thaler Group in New York. Pillsbury was recognized at the Images in Advertising Awards for a Garden State Equality spot. The ad, meant to raise awareness about GLBT families, shows President Bush on TV talking about the sanctity of marriage as a same-sex couple (actually Pillsbury and his partner) busily attends to their kids. The super informs viewers that the duo missed the speech about family because they were too busy being one.

"I know when the joke is a gay joke," Pillsbury says in reference to the Snickers spot, which has been criticized for perpetuating violence against gays. "Don't bullshit a bullshitter. It's insensitive. You wouldn't do that [with] race or gender." As for Nike's spot, "two men being that intimate is discussed in revulsion. It's a gay joke," he says.

At the same time Nike was being criticized for its misstep, it was up for a diversity laurel at the Image Awards. The nomination was for a copy-based print ad that discussed being "proud to be gay."

"Both the company and their agency have had a very good reputation for doing inclusive advertising up until this point. It seems they've gone astray," says Wilke.

"There's a long-standing chestnut that homophobia sells," he adds. "For an industry that lives and dies by data, it's never something that has been proven by research. We believe if research were done, it would prove just the opposite."

Robert Cameron, vp of marketing at Levi's, says the jeans brand produced the winning ad with alternate endings in order to speak to the gay community while on a limited budget. Addressing the recent spate of controversy surrounding gay themes in advertising, Cameron says, "It's a process. It takes a commitment to get it right."

Doug Raboy, managing partner, cd at Hanft Raboy & Partners, New York -- honored for its "No issues here" campaign for Chemistry.com at the Image Awards -- says the advertising industry has taken "baby steps" in the right direction, but that even controversial ads such as Nike's have their role.

"What excites me is that it gets people talking about the issues," says Raboy. "If it can create a dialogue, then it's a step in the right direction."