What happened at the Liquor Board on September 4, 2014.

The Liquor Board has had a decades-long history of the transfer of expired licenses, especially when the (former) licensee has entered into an agreement to gain the support of a community association. In doing so, the Board is abdicating its responsibility to enforce the provisions of Article 2B.

Mr. Kodenski presented his case first. He explained that the applicants were requesting a transfer of ownership only in an existing location. The current licensee owns the license subject to a secured interest. When the licensee sells the license to the applicant, he will be able to pay the secured creditor. Mr. Charles Armwood, one of the applicants, lives a couple doors down from the location and has lived there “thirty-something years.” Armwood will help run the establishment, but the other applicant, Mr. Michael Ghebru will do the day-to-day managing. Kodenski submitted letters of support from one of the neighborhood associations for this address, Fulton Community Association.

Dr. Marvin Cheatham presented nine exhibits to the Board, including a large map of his area of West Baltimore, showing the locations of all of the local liquor stores. He told the Board that his neighborhood, the Matthew A Hensen neighborhood, is “inundated” with liquor stores. There are fifteen within his association’s boundaries. Chairman Ward pointed out that the association’s boundaries comprises a “huge area” of West Baltimore.

Chairman Ward indicated that the transfer at issue is a change in ownership only; the store already exists. Ward asked whether Dr. Cheatham had some knowledge of the people who are buying the license. Cheatham said that he did not. Ward replied that there is no evidence of any “improper performance” at this store and “to use a back door approach to get rid of the license would seem a bit unusual.” Cheatham said, that the fact that his neighborhood has such a disproportionate number of liquor stores is unusual as well. Cheatham said that, while he doesn’t know this new owner, he does know that the “overwhelming majority of the liquor store owners have no relationship with the community. They’re doing harm to [the] neighborhood.” He said that his community association would like to talk to the prospective owners.

Chairman Ward took the opportunity to mention new Liquor Board policies. He said that the agency will increase the inspectors on night duty, because that is where most of the trouble is. Inspectors will also be giving reports of what is going on and how many times bars and liquor stores are inspected. He added that “these bars exist and you just can’t wipe them out.”

Cheatham clarified that he is asking the Board to require the applicants to meet with all of the community organizations in the area. He would like the opportunity to sit down and discuss the issues and come back with an agreement to the Board. He noted that 18% of the homicides in Baltimore City take place in the Western District and that liquor stores are directly related to crime and violence.

At the end of Cheatham’s presentation, Chairman Ward asked, “have you ever run for public office?” Cheatham replied, smiling, “I did, but I didn’t do too well,” adding “I’m a civil rights leader. … I try to help people.”

Mr. Kodenski responded to Dr. Cheatham’s presentation, saying that this application to transfer ownership has been pending for a long time and there is a time-sensitive situation due to the secured creditor’s interest in the license.

Commissioner Jones pointed out to Dr. Cheatham that if the applicant doesn’t do what he says, the community can “bring him back before the Board again.” Jones advised Cheatham and the community members to “take very strong notes” and ” be able to identify all of your concerns, clearly.”

Commissioner Moore mentioned a letter from the file from Mr. Larry Jennings, the secured creditor on the license. He objects to the transfer very strongly in the letter. Moore noted that “he even has words like ‘cease and desist'” in the letter. Kodenski responded that Mr. Jennings’ concerns are the reason why there’s “some urgency” with respect to the transfer. The licensee’s “got to get the money to pay [Jennings] off.”

Dr. Cheatham stepped in again to say that there had been a lot of discussions with respect to the secured creditor and other entities but the discussions did not take place with the whole community. The community association can only respond when they see public postings. He said, “these owners don’t come to us. They depend upon us seeing the posting and then coming down here.” He said that this lack of communication forces too much on communities.

Chairman Ward asked, “what have you done that equals $500,000?” (Article 2B requires a minimum $500,000 capital investment in order to qualify for a new Class B restaurant license.) The applicants’ attorney submitted a projected capital investment breakdown. She told the Board that the applicants will submit further documentation when the work is completed. The project will be done in early December.

Commissioner Moore asked how much money the applicants have actually spent? Mr. Charles Heiss testified that they have probably spent around $300,000 but plan to spend $1.6 or 1.7 million, total. Mr. Heiss testified further that the restaurant will serve South African chicken. Nando’s is a chain restaurant, and this will be their 21st location in the DC/Baltimore area. There will be seating for 108 people, and there will be no bar in the restaurant. On average, only 5% of Nando’s sales in the other locations are from alcohol.

Commissioner Moore asked who the day-to-day operator will be, since that section of the application was blank. Ms. Schrecengost replied that the applicants will provide that information to the Board later.

Commissioner Moore asked, “what is the hardship?” Mr. Beaven responded that he has just had a hard time trying to sell the restaurant and the license. Chairman Ward said, “but you’ve succeeded.”

Mr. Beaven asked how long it will take to transfer the license, because he did not know how long of an extension he should request. Executive Secretary Michelle Bailey-Hedgepeth said, “I would say they should ask for the full hardship extension.” Chairman Ward told Mr. Beaven, “don’t come back [for another hardship extension] with a lot of excuses.”

Mr. Beaven’s license has already expired under Article 2B section 10-504(d). Beaven received his one allowed hardship extension under Article 2B section 10-504(d) on February 6, 2014. According to the file, Morning Edition Cafe closed in August 2013. 360 days have passed between the establishment’s closure and the September 2014 hearing before the Board; therefore, the license has expired by operation of law and any hardship extension given by the Board is not authorized under Article 2B.

Mr. Paul Robinson, community member and former president of the Federal Hill Neighborhood Association, appeared on his own behalf as a resident. He is one of the neighbors who appealed the February 20 Board decision. Chairman Ward asked, “what is your opposition? This is a request for a hardship extension.” Robinson replied that the licensee should not be permitted a hardship extension, because it was not requested within 180 days of the cessation of the business. The last time a bar was open at this address was on or about September 1, 2009. Robinson pointed out that the February 20 hearing was not an “approval” of the license but was rather a hearing on the validity of the license. Robinson said that the Board had decided that the license was “viable.” Commissioner Jones said that he didn’t remember anything from the February 20 hearing, because the case “was so long ago.”

Brooke McDonald, another resident, then requested that the matter be postponed. The appeal of the February 20 decision has been remanded to the Board for a hearing on September 25, and the community members present were hoping that all of the issues relating to this license could be heard at once on that date. Ward replied, “I have to say that it makes sense to put it all together.”

Woolman replied, that the scope of the hardship extension request is very limited. Ward disagreed, saying, that the Board has “much broader jurisdiction. Thank goodness we’re not burdened by huge number of regulations.” Ward went on to tell Mr. Woolman, “somehow or other you’ve gotten past the Board on your license. I don’t know how or why. Meanwhile [the neighbors] appeal it, and the Circuit Court has questions. They sent it back to the Liquor Board.” As an aside, Ward noted that when he was a Circuit Court judge, “I never did that. I decided everything.”

Commissioner Moore asked Mr. Singer whether he planned to get his corporate entity in good standing and he replied that he would.

Executive Secretary Michelle Bailey-Hedgepeth announced, “Chairman, I have one item which I would like to add to the agenda. The people were mailed, and it’s not on our agenda.”

Mr. Gary Maslan appeared, with his client, the applicant. Maslan told the Board that the establishment is the Hollinswood Inn. He said that there “is no real community association around it. The old community association disbanded.” Maslan stated that the applicants reached out to the neighbors. The current licensee is staying on the license to assist. The other applicant has had alcohol experience in Dundalk. The establishment has its own parking lot and is in a freestanding building.

Baltimore’s Cityview website shows seven potentially active community associations in the area, including: Gwynns Falls Trail Council, Mt. Winans/Westport/Lakeland Master Plan Task Force, Southern District Police-Community Relations Council, Lakeland Community Association, Lakeland Coalition, Southwest Community Action Center, and Westport/Project T.O.O.U.R., Inc. Youth Council.

Baltimore Police Lieutenant William Colburn, Police Officer Todd Brown and Inspector Mark Fosler were all present at the hearing but did not testify.

Baltimore Police Officer Michael J. Pusloskie, Jr. testified that on August 9, 2014, at 1:19am, he was issuing parking tickets on the street when he observed a fight coming out the front door. The security officers inside the establishment were pushing people out the door. There were two other officers in the area, but they needed more officers to deal with the situation. One of the officers issued a “signal 13,” to which 25 officers and the Foxtrot helicopter responded. The officers had to block off Conkling Street because of the large crowd of people coming out the door. The officers arrested four people for being intoxicated and disorderly. One officer had to pepper spray one of the patrons. It took police about an hour to clear the area (They finished around 2:30am.). He elaborated that some of the intoxicated people fell down and had to be carried by their friends to their vehicles.

On cross-examination, Mr. Kodenski asked whether Mr. Pusloskie actually saw the bar staff sell or furnish beverages to any of the intoxicated patrons. Mr. Pusloskie said that he did not.

Commissioner Moore asked Mr. Pusloskie what a “signal 13” is. He replied that it means that an officer is in distress or dire need.

Lieutenant William Colburn corroborated Mr. Pusloskie’s story, as he was one of the officers to respond to the “signal 13.” Colburn said that it was a large event and very disruptive to city as a whole. The 25 officers who responded to the establishment came from other places around the city. Colburn added that this kind of event is uncharacteristic for this licensee. The licensee is generally cooperative, and the police department met with him the next day to discuss updates to his security plan, given the events of August 9.

Commissioner Jones asked whether the security officers at Euphoria are off-duty officer? Colburn replied that they are not. He explained that bar owners may hire off-duty police officers to work outside of their establishment as additional security personnel, but off-duty police officers are prohibited from working inside a bar or restaurant.

Commissioner Moore asked whether there was a cost to the incident on August 9. Lieutenant Colburn replied that there is a cost, not so much financial, but with the police department’s resources. Other neighborhoods throughout the city are not being policed when a signal 13 draws them to one place.

Mr. Kodenski, on cross-examination, asked the police whether the bar was in a commercial or residential area? The police officers replied that it is in a commercial area. The Royal Farms store nearby may have been affected, but most other businesses on the block were closed at that time of night. Mr. Kodenski closed by arguing that the police had not proven that the individuals who were intoxicated had been furnished alcohol by Euphoria. The charge states that the licensee sold or furnished alcohol to these individuals, but, Kodenski said, “we don’t know where they got it from” and “we can’t do the quantum leap.”

Baltimore Police Detective and Police Cadet Gregory McCoy testified that at 9:45pm on the date in question, Cadet McCoy, who is under age 21, entered the store and purchased a 375ml bottle of Southern Comfort whiskey for $9.80 with a departmental $20 bill. [The police officer with the cadet retains a photocopy of the $20 bill used to purchase the alcohol, so that the police can retrieve it after the sale.] The police testified that, when they attempted to recover the $20 bill, the license attempted to give Greenhill a counterfeit $20 bill. When the licensee opened his register, the departmental $20 was not in the register. The licensee then started removing $20 bills from his pants pockets. Lee eventually found the correct bill in his pocket.

The licensee then testified in his defense. He said that his current practice is to put larger bills in his pockets, because he has had many thefts before. He said that he never gave the officer a fake $20 bill; rather, he just grabbed the first one out of his pocket, which was not the correct bill. When Greenhill showed the licensee the photocopy of the bill, he found the correct one in his pocket. The licensee says that he keeps a fake $20 bill taped to the wall behind the register to remind him to check the authenticity of $20 bills that he receives with his UV light. Greenhill responded that the fake $20 bill was not taped to the wall; it was laying near the register. He said it didn’t look like a US currency note. It looked like Monopoly money and was faded.

The Board heard testimony from Baltimore Police Detective Abraham Gatto and Cadet Gregory McCoy. Mr. McCoy purchased a Bacardi Gold drink from an employee named Mr. Curry and paid $8.36. Mr. Curry did not ask for identification from Mr. McCoy.

Baltimore Police Detective Abraham Gatto testified that he and Detective Akinwande went to the strip club in an “undercover capacity,” using pseudonyms. (Detective Akinwande’s pseudonym was “Omar.”) They sat at the bar and had drinks. Then Detective Gatto paid $70 for a back room “for the event of a lap dance” from a woman whose stage name was Mimi. The dancer’s “government name” was Amira Bell. Gatto began talking to Ms. Bell about what she would be doing when she was done with work. Gatto told her that he was interested in having sex with her. Ms. Bell asked Gatto what was in it for her. Gatto elaborated that he wanted her to have sex with both him and his friend (Detective Akinwande). She said that it would cost them $100 each. Gatto made plans with her to come back to the bar around 2am, when she was done with work. Bell told Gatto that she would be waiting in the parking lot. The officers left the bar around 11:55pm that night and described Ms. Bell to Sergeant Chris Leisher. She was formally identified by other police officers and was sent a criminal summons for prostitution. Nothing else occurred between Gatto and Bell that night; he didn’t meet her.

Mr. Cardin then cross-examined Detective Gatto. Carden asked whether Gatto arrested Ms. Bell that night; Gatto replied that he did not. Ms. Bell was summonsed on January 6, 2014? Gatto replied that was correct. He also testified that Sherrie’s was not notified of the charges until they received a notice of a hearing from the Liquor Board. Cardin asked whether Ms. Bell was prosecuted for prostitution, and Gatto did not know. Gatto did testify that he was the one who brought up the idea of sex with Ms. Bell.

Mr. John Zaganas then testified that Ms. Bell does not work at Sherrie’s anymore. She worked there 2-3 years ago and was briefly rehired by the bartender. She worked one or two nights at Sherrie’s and then never returned. Sherrie’s did not know about the incident until March 2014, when the Liquor Board inspector brought notice of the hearing. Zaganas said that, recently, Ms. Bell’s daughter came in to Sherrie’s looking for a job, and the management turned her daughter away.

Cardin then argued that there was no solicitation in Gatto’s description of events. Rather, he said, Ms. Bell was solicited by Gatto. He said that she may not have been entrapped by Gatto, but she was enticed and induced to respond the way she did.

Commissioner Moore asked, “how old is Amira Bell?” On the charging sheet, her date of birth is 1992; Moore asked how old her daughter could have been, to ask for a job at Sherrie’s. Upon hearing that information, Mr. Zaganas said that perhaps the story that he had heard about Ms. Bell’s daughter was really about someone else. Mr. Zaganas chimed in again to say that Sherrie’s does not have a “back room;” rather, there is a room for lap dances that is “open for everyone to see.”

During the sentencing part of the hearing, Ward said to Cardin, “when you and I were young men, you and I probably went to Sherrie’s.”

John Zaganas said that Sherrie’s has enough financial problem without getting themselves mixed up in violations for prostitution. Business is slow, due to the bad economy. They’re also not close to many hotels. “The last thing in the world I need is this,” he lamented.