I've heard of the Hot Coffee thing a long time ago on the news. Well, I've heard of games containing sex in it. This also reminds me of this game for the Atari called Custer's Revenge that I've heard about a couple years ago. I know I'm gonna post a link because I suck at describing things but there's a Wikipedia article that includes basic information on the game (I know this is an exception for posting Wiki because people could edit it, but this is just used as a link for basic information).
http://en.wikipedia.org/wiki/Custer's_Revenge