What happened at the Liquor Board on July 10, 2014.

Judge Ward asked Mr. Hurdle whether he was really requesting to reopen after being closed for more than three years? Mr. Hurdle replied that he had withdrawn his request and did not address the allegation that the bar had been closed for over three years. Judge Ward then said, “We can deny the request and kill the license?” Mr. Hurdle responded that, since he had withdrawn his request to reopen, there was nothing for the judge to rule on. Judge Ward disagreed. “That’s it,” the judge said, declaring the license invalid.

There have been three previous hearings scheduled for the transfer: one on May 1, 2014, one on May 15, 2014, during which more than three hours of evidence was presented, and the decision on June 26, 2014, when the new Board held that the community would have to re-do its May 15 hearing due to the two new Commissioners.

Judge Ward responded, “I think they’ve had plenty of time. I feel very sorry about the deaths and changes to family and so forth. I’m inclined to feel that [the hardship extension request] should be denied.” Mr. Prevas pointed out that previous Boards had not enforced the 180-day provision in Article 2B section 10-504(d). Because this new Board intends to enforce the law, as a “change of policy,” Prevas requested that the Board “consider giving one more bite at the apple.”

Commissioner Moore noted, “I don’t think this is a change of policy; it’s just an application of the law.” She said that she does have empathy for the difficult family situation and finds the licensee’s situation compelling. She pointed out that the licensee’s trade name has lapsed, the corporation has been forfeited by the state of Maryland, and there is a lot that “needs to be cleaned up and taken care of.” However, she was persuaded by the family situation and would support a brief extension under the circumstances.

Mr. Prevas represented a potential interested party, Dennis Richter. On further questioning from Commissioner Moore and Judge Ward, Mr. Prevas admitted that his client did not really own any interest in the license at the time of the hearing.

After the Board made its decision, Mr. Ivey told the Board, “don’t waste our (the licensee’s) time to come down here if you know you’re going to deny [the hardship extension]. Commissioner Moore replied, “it’s a public hearing process. I don’t consider it as a waste of anyone’s time.” Judge Ward added, to Mr. Ivey, his voice rising, “you’re on the verge of being insulting. You have a matter before this board, asking for something absolutely against the law. A license is a permission, not a right. The law is clear on the subject. If you want to invoke the law and ask us to make an exception, you’re going to have to come down here.”

Commissioners Jones and Moore stated that they would be willing to grant one 180-day hardship extension, given all of the licensees’ circumstances.

Judge Ward noted that the licensee had requested a hardship extension in February or March of last year (2013).

The licensee also requested a waiver of assessed late fees. Commissioners Jones and Moore also agreed to the waiver of the fees. Moore noted that Councilman Mosby had submitted a letter adamantly objecting to the granting of the hardship extension.

Commissioner Moore stated that her concern is that corporate entity is dissolved. Mr. Kodenski responded that once the application to transfer ownership is approved, the licensees will have to revive the corporation. Commissioner Moore replied, “but there is no corporate entity.” Kodenski said, “you still have licensees.” Moore asked, “is it the humans that are transferring or the corporation? Why don’t they do it first?” (Meaning: why don’t the applicants revive their corporation before applying to transfer its ownership?) Kodenski responded, “why don’t people do anything?”

Commissioner Moore asked whether Mr. Bosco, then, was asking for an advisory ruling. She noted, “if you don’t need it, I don’t think we should give it. Come back when you need something. My suggestion is that we take no action.”

However, even if there is a statutory exception to the rule that an entity cannot own both a Class D and a Class B license at the same time, the Board did not explain how Verde Corporation could be using both licenses at the same time. It would seem, logically, as though Verde Corporation could be using either its Class B or its Class D license, not both. If the corporation is only using one license, it would, then, have to obtain a hardship extension for the other license while it tries to sell the unused license. The Board did not even consider this problem.

Commissioner Moore noted that the letter of support from the Fells Point Residents’ Association was dated July 6, 2007 and asked if there was any more current letter? Ms. Bailey-Hedgepeth noted that the Board had received a more recent email of support from FPRA and had added it to the file.

Commissioner Moore asked, “what’s the ‘special entertainment’?” Mr. Shaulis replied, “Mr. Horsman is an internationally renowned magician. He’s been in Las Vegas, Japan, France and Germany. He performs illusions.” Judge Ward pointed out that the definition of “special entertainment” in Article 2B is “very broad. You can do almost anything.” Commissioner Moore laughed and said, “within reason, Your Honor.”

Mr. Steve Johnson, chair of the Liquor section of Mt Vernon Belvedere Association, was also present on behalf of his community group. The MVBA is in support of the project, under the conditions and restrictions negotiated with the applicants. Live entertainment will be limited to three-piece acoustical groupings and the occasional band. Mr. Johnson said that MVBA has no objection to live entertainment at this time, but if the license’s ownership is transferred in the future, MVBA retains its rights to protest at that time.

Mr. Kodenski represented the applicants, informing the Board that they have owned the property for eight years and that they are “taking property back,” presumably from a tenant, and rehabbing it. They have met with individuals in the community, and community members are okay with the proposal. They are not requesting live entertainment, and there is a parking garage close by for patrons. Commissioner Jones asked whether the applicants had received a letter of support from the community association, and the applicants responded that they had not.

Mr. Mike Hilliard, community services director of HARBEL Community Organization, told the Board that the Belair Community Association has no opposition to the transfer. (HARBEL Community Organization is an umbrella community group that advocates for many communities in Northeast Baltimore.)

Commissioner Moore pointed out that, according to the application to transfer ownership, Ms. Senegal lives in Vienna, Maryland (two hours from Baltimore) and that Mr. Williams lives in Gaithersburg. The appliants responded that Mr. Williams will be moving into the residence above the establishment.

When the Board re-called the case, Mr. Kodenski informed the Board that the applicants had decided to withdraw their request for live entertainment but are keeping their request to transfer ownership. It’s a Class D beer and wine license; the licensees will not be allowed to sell liquor at this location. Mr. Kodenski added, “It’s a Hispanic place as many of those are up in Highlandtown. The two individuals have been learning the business and working there.”

One of the applicants testified that the establishment will be a restaurant and bar. Judge Ward asked, “what kind of a bar?” Neither applicant could answer his question. There was a significant language barrier, and the applicants needed a translator.

Ms. Brooks, board member of GGNA, explained that the organization is opposed to the transfer, because Mr. Juan Moreno had approached them as the new owner of the bar, not the applicants on the license. Mr. Moreno clarified that his wife, Irina Gomez, would be the licensee, because he already has a liquor license in Baltimore City. Ms. Brooks said that GGNA wants restrictions on the license. Judge Ward asked whether GGNA and the applicants could work out the restrictions in the hallway, and Ms. Brooks replied that they could. Ward replied, “I’m going to set the case aside and recall it.”

When the case was recalled, GGNA, Greektown CDC, and the applicants had agreed to the following restrictions. The hours of operation will be 10am-midnight, Mondays-Thurdays, unless there is a special event. If there is a special event, the applicants agree to give the community organizations two days’ notice that they will be open later. On weekends, the establishment will be open until 2am. There will be security personnel present on weekends and security video cameras on all the time.

Mr. Steve Johnson, chair of MVBA’s liquor committee, testified that MVBA is entirely in support of the Class B license application and of the application for a microbrewery license (which is not issued by the BLLC). The organization appreciates the applicants’ willingness to limit outdoor table service after 10pm.

Commissioner Moore asked how close the proposed establishment is to the St Ignatius Middle School. Mr. Pica responded that it was a block away. Moore followed up, “so more than 300 feet?” and Mr. Pica replied, “yes.”

The proposed restaurant will be inside the Ritz Carlton building in Baltimore. Mr. Joe Graziose is one of the developers of the Ritz Carlton in Baltimore and lives on the premises. There is also a spa and a marina included in the facility, located directly across the street from the American Visionary Arts Museum. There are four hundred people living in the Ritz Carlton complex. Mr. Graziose testified as the president of the homeowners’ association board that the organization’s members embrace the idea of the restaurant. The residents will have the luxury of having a restaurant that they can enter from their residence. The complex opened in 2008, and they have never had an incident of crime inside the building.

Judge Ward attempted to refresh the Board’s recollection of the case, which was previously heard on December 12, 2013, in front of the previous Board. Judge Ward said, “as I understand it, [Mr. Danielczyk] wanted to include an adjoining rowhouse [as part of his bar]. He had already taken down the inside wall. The Board wanted to see how he came out. They said come back in and we’ll hear from you. At that time, they denied it.”

Mr. Prevas replied that Judge Ward was “half right.” He explained that the original bar, Silk’s, has a history that goes back to Prohibition. Jimmy Silk’s bar was the first floor on the corner. Mr. Danielczyk purchased the adjoining rowhouse, one in from the corner, and wanted to expand into new building and the second floors of both buildings. Prevas explained that the concern of the Board was that by expanding to the building next door and to the second floors of both, that a bar with four times the space might have too big of an impact on the neighborhood.

Commissioner Jones added one correction, that one of the Board’s concerns was that the expansion came without the proper authorization from the Liquor Board. At the time that Mr. Danielczyk wanted to expand, he hadn’t yet sold one drink to a customer. Jones explained, “I thought that was unfair to the community for him to expand without permission and to do it without the Board being aware of it. How can I trust him now?”

Mr. Prevas explained that Mr. Danielczyk opened the bar in March 2014, so he now has a track record. He submitted a letter from the Canton Community Association in support of the proposed expansion and outdoor table service. The applicant proposes six outdoor tables, seating four people each. There will be nine feet of sidewalk space on both sides to allow pedestrians to pass. Mr. Danielczyk explained that the establishment really is focusing on food, not alcohol.

Commissioner Jones pointed out that the Board told the applicant to come back six months after the bar opens, so that the Board can see a track record. He pointed out that March to July is only four months, not six, and again brought up his issue with trusting the applicant.

Commissioner Moore said, “there is a lot of fuzziness here. Is there anyone here from the community association?”

At this point, Mr. Larry Singer, community member and resident of a nearby senior building, was sworn in to testify. Mr. Singer told the Board that, so far, the bar has been run well and that people in his building enjoy going there. However, Mr. Singer opined that “there have been some smoke and mirrors involved in this license.” He argued that the bar shouldn’t be allowed to have a second floor. He pointed out that one of the express concerns of former Chairman Fogleman is that the bar would turn into a megabar. According to Singer, the bar in its expanded capacity would rival the capacities of the largest bars on O’Donnell Street, in a much more residential area. To turn it from one address on one floor, to four times the original capacity would be a dangerous precedent. Mr. Singer did admit that the patrons, in his opinion, so far, “have been decent people who don’t cause a disturbance.”

Commissioner Moore asked about the posting of the property. The Executive Secretary and Mr. Prevas explained that the property was posted for the December hearing but not for the reconsideration. The reconsideration was placed on the docket, however. Commissioner Moore asked, “did you, the applicant, reach out to the community?” Mr. Prevas held up the letter of support from the Canton Community Association. Moore replied, “no, I’m not impressed by that.” Mr. Danielczyk responded that he talked to the people on his block in person. Mr. Singer said, “I don’t have a computer, so I’m certainly not on an email list.”

Commissioner Moore asked about the six month rule. “Did that apply to six months in business or from the date of the hearing?” Mr. Prevas said that he honestly did not recall, but that he had filed the motion for reconsideration within thirty days of the original hearing, for appeal purposes.

To view the decision phase from the December 2013 hearing, click play on the video below.

Mr. Kodenski objected to the reconsideration. He pointed out that the original hearing was held by a different board at a different time for different reasons. He added, under the Baines case, I think it’s inappropriate.

Mr. Silbiger responded by giving the history of the case: in March, the licensee filed his renewal application and the community members filed a protest of the renewal. The community protesters were ready to present their witnesses and evidence to the Board, but the Board would not hear their protest predicated on Mr. Kodenski’s motion to dismiss, based on the 200 foot rule. [For a discussion of the 200-foot rule, please see the Booze News post on the prior hearing here.] Judge Ward quickly replied, “now that’s gone” (referring to the 200-foot rule).

There was a very brief discussion of the other docketed case, the remand from 2013, but there was no definitive ruling on the 2013 remand.

Mr. Silbiger asked the Board to allow the protestants to testify as to why they feel that the license should not be renewed, by setting the case in for a hearing, in a proper form before the Board. Silbiger said that the neighbors have “a plethora of evidence” to present, but that the prior Board prevented them from submitting any testimony. Judge Ward replied, “that certainly seems to be in accordance with the Board’s new policy.” Mr. Kodenski said, “for the future, I agree. But in this case here, it was ruled upon. The license was renewed. Under the Baines case, you can’t go back. The 200-foot rule was something that only came up this year.”

Judge Ward interrupted Kodenski, saying, “I think it’s outrageous that people should be prevented from giving their opinion as to a license unless they live 200 feet away. It’s so outrageous as to be almost blinding.”

Kodenski insisted that Article 2B requires protests of renewal to be held in the month of April. He reiterated that the license has already been renewed for 2014. Prospectively, he said, if this Board wants to revisit the definition of “immediate vicinity,” that is fine. There has been no appeal filed, and it is past the point where the community can go back to ask for a review of a renewal when the license has already been renewed.

The Board has already approved the renewal of the license. However, the statute says that “a license may not be approved without a hearing,” so the community organization has a good argument that the renewal wasn’t legally approved under Article 2B, since the Board did not allow a public hearing to go forward.

Liquor Board inspector Joann Martin testified that she made a routine inspection on October 7, 2013, at 5:55pm. The doors of the restaurant were locked, though the license was a Class B restaurant license. [The docket states that the license is a BD-7; this may be a mistake.] Martin saw a new sign, advertising liquor and packaged goods. Mr. Clark was working as the manager of the unauthorized packaged goods store, and, when asked by Ms. Martin, Mr. Clark could not produce the liquor license. Clark called Mr. Cao, who came to the establishment and found the license in the locked restaurant portion of the building.

Martin continued with further charges. On a routine inspection to the establishment on May 31, 2014, she saw a newly constructed fence around an outdoor seating area which contained a picnic table and two other high top tables. This new seating area had not been authorized by the Liquor Board or by Baltimore City’s zoning and permitting agency. The restaurant, again, was not open and operating at the time of Martin’s visit. Martin contacted Mr. Geoffrey Veale to confirm that they had not given permission for no outdoor tables. Inspector Martin submitted color photographs of everything that she described in her testimony, which she took herself on her visit.

Liquor Board inspector Karen Brooks visited the establishment one week earlier, on May 23, 2014. She also found the restaurant portion of the building to be closed and locked. She went into the packaged goods section of the building, where she overheard a conversation about a party at the establishment that was supposed to occur the next day. Brooks returned the next day, on May 24, 2014, at 10:08 pm. Again, the restaurant dining room doors were locked. There were three men standing at second door collecting money for the party: $5 for people with an invitation, $10 for people without an invitation. Inspector Brooks went to the packaged goods section and saw people buying beer to go. The kitchen was in total disarray: there were power tools and building supplies on tables, the large refrigerated walk-in unit and the freezer were not functioning. The kitchen was dirty, there was no food cooking or being held for service. There were not sufficient plates to serve food to customers. In the lounge portion of the establishment, a few people were sitting at the bar. There were several trays of food sitting on a table.

Mr. Shaulis objected, saying that the inspectors’ reports do not represent the restaurant as it usually exists.

Commissioner Jones asked Ms. Brooks why she went out to the establishment. She testified that she was instructed to find out whether the business was operating as a restaurant, so she went to see what it looked like on a busy weekend. She added to her previous testimony that “it was not a restaurant, by far. The cooking utensils were rusted and dirty. All the work surfaces were dusty and cluttered with power tools and other building equipment.

Mr. Shaulis cross-examined Ms. Brooks and Ms. Martin on their inspections. He also pointed out that Mr. John Howard had inspected the place the very same day as Ms. Brooks did, and he had issued a satisfactory inspection report.

Commissioner Jones asked more questions about the outdoor tables: “where were they supposed to be located on the premises?” Martin replied that they were approved for the right side of the restaurant, when the establishment used to serve crabs. She added, “The licensee proceeded to put tables on the other side that was not approved as per zoning. I did confirm with zoning that they were not within the scope of their permit.” She also testified that she did not believe that the fence was erected under a permit.

Mr. Shaulis tried to interrupt Inspector Martin throughout her testimony, which provoked a sharp response from Commissioner Moore. Moore told Shaulis to let Inspector Martin finish her sentence before he objected to her testimony. “Interrupting her is not going to work,” she said.

Commissioner Jones asked whether the inspectors saw people being served at an outside table. Martin replied that she saw someone sitting outside with a can of beer (and no food); she told him that he needed to come inside to drink his beer, because “the outdoor table service does say it’s an accessory to the restaurant.”

Inspector John Howard added that during his visit, he asked for food and was told that the establishment wasn’t serving food.

After the inspectors’ testimony, Shaulis moved that all of the charges be dismissed, because the evidence presented was insufficient. Ward replied, “I think the evidence is overwhelming. Denied.”

Finally, Mr. Cao, the licensee, testified. He said that the establishment is a restaurant. He said that the restaurant is always open and that all of the inspectors are not telling the truth.

Detective Shelton Jones read from his report, and Police Sergeant Chris Leisher was also present.

As a preliminary matter, Mr. Boozer made a motion to dismiss the charges, noting that the alleged gambling violation is twenty-six months old. There is no statute of limitations issue on the case, but he raised a “laches” issue. [Laches is an unreasonable delay in making a claim.] He argued that Mr. Bommakanti was not able to adequately prepare for the hearing because of the long delay, which is a severe prejudice. Ward denied the motion to dismiss, saying, “you’re not in Circuit Court.”

Detective Jones then read from his 2012 report. Jones witnessed an illegal payout from a video poker machine while in the store in plainclothes. He obtained a search and seizure warrant from Judge Waxman on May 18, 2012. The police recovered $5,000 related to the illegal gambling, in cash, located in the cash register and in other places that the licensee had stashed around in the store. The police also retrieved five video gaming machine circuit boards and their power packs. Jones explained that, rather than taking the whole machine, police take the parts from inside the machines so that they become inoperable. He explained to the new commissioners that the licensee had rigged the machine to add up points, which the patron then exchanges for money from the store employee. The employee then resets the machine with an illegal button installed on the outside of the machine.

Mr. Boozer cross-examined Jones about his testimony. Boozer asked, “is simply having a knockoff switch on a video poker machine illegal?” Jones responded that he believed that it was. Jones didn’t recall some details of his visit to the store (descriptions of people inside the store, locations of the machines within the store), since the events took place over two years ago. However, Jones did remember the clerk clearing the points from the machine using the knockoff switch.

Mr. Bommakanti then testified about the incident. He was present in the store at the time, but he didn’t recall seeing Detective Jones. Mr. Bommakanti informed the Board that his store burned down on October 4, 2012, and he has not reopened or rebuilt since then. Commissioner Jones asked, “did you have insurance?” Mr. Bommakanti replied, “not really.” Mr. Boozer explained that the licensee did not own the building; his landlord, the building owner had the structure insured, and he has elected not to rebuild. Rather, he has put up the land for sale. Mr. Bommakanti was insured to 20% of his gross sales in one year; Bommakanti is still negotiating the terms of his insurance payout with the insurance company, but he has received an advance of $170,000 and expects to receive a total of $224,000.

After his client’s testimony, Mr. Boozer asked again that the Board would dismiss the violation, since it took place 26 months ago. He pointed out that Mr. Bommakanti and his employees have never been charged criminally, and the $5000 seized by the police department has never been returned to him.

Judge Ward then asked, “suppose we find that the charges are sustained. What penalty should we assess? Mr. Boozer replied, “I would suggest that my client has paid the ultimate penalty. There’s really nothing more that the Board can really do to him.” Commissioner Moore responded, “we can impose a penalty.” Mr. Boozer disagreed, suggesting that the Board can only impose a penalty against the license, not the licensee. Boozer stated that “the store is no longer there.” Ward contradicted Boozer, saying that the penalty is “against the person who commits violation.” Ward asked Boozer again what amount he would suggest for a fine. Boozer responded, “I would suggest $0. He has nothing left.” Moore pointed out that Mr. Bommakanti had received an insurance payout of $174,000. Mr. Boozer attempted to contradict Moore, interrupting her statement, but Boozer then realized that Moore was correct. Moore then said to Boozer, “the less you talk, the more you listen. Interesting phenomenon.”