Index: lib/bluecloth.rb
===================================================================
--- lib/bluecloth.rb	(revision 81)
+++ lib/bluecloth.rb	(working copy)
@@ -1025,10 +1025,12 @@
 	### Escape any characters special to HTML and encode any characters special
 	### to Markdown in a copy of the given +str+ and return it.
 	def encode_code( str, rs )
-		str.gsub( %r{&}, '&' ).
-			gsub( %r{<}, '&lt;' ).
-			gsub( %r{>}, '&gt;' ).
-			gsub( CodeEscapeRegexp ) {|match| EscapeTable[match][:md5]}
+		unless filter_html
+			str = str.gsub( %r{&}, '&amp;' ).
+				gsub( %r{<}, '&lt;' ).
+				gsub( %r{>}, '&gt;' )
+		end
+		str.gsub( CodeEscapeRegexp ) {|match| EscapeTable[match][:md5]}
 	end