Galardi lawyers question constitutionality of law

Stephen Curran

Wednesday, April 27, 2005 | 9:47 a.m.

Lawyers for strip club mogul Jack Galardi have taken aim at what they say is an unconstitutional county ordinance that allowed commissioners to deny him a liquor license last month, according to a lawsuit expected to be filed today.

Commissioners, acting as the county Liquor and Gaming Licensing Board, unanimously denied Galardi's request Tuesday for another hearing on the liquor license. They had denied an earlier application for a tavern license at the Leopard Lounge at 3500 West Naples Drive near West Tropicana Avenue on March 22, saying a routine investigation by Metro Police turned up evidence of solicitation of prostitution at Galardi's other clubs in Florida and Georgia.

South Carolina civil rights attorney Suzanne Coe, who represents Galardi's businesses in the Southeast, said the board's decision was based on a vague county ordinance that fails to differentiate between licenses governing alcohol sales and those over erotic dancing, which Coe argues is free expression and is therefore protected under the First Amendment.

The policy is part of a "patchwork" of county licensing rules added over time that make for a largely arbitrary and confusing procedure by the board, she said.

"The key issues are that the licensing scheme, as it's written and as they apply, is flat-out unconstitutional," Coe, who joined Galardi's Las Vegas attorney Dominic Gentile at Tuesday's hearing, said. "Why it hasn't been challenged and struck down is beyond me. I have never seen a more inefficient licensing scheme."

Coe said she and Gentile are expected to file the suit in federal court early this afternoon.

Derek Dubasik, the county's assistant manager of business license operations, said Galardi's application for a tavern license was turned down last month after a routine investigation by Metro Police found solicitation of prostitution and illegal touching between dancers and customers had occurred at Galardi's other clubs in Florida and Georgia.

The club had been operating for 14 months on a temporary liquor license while Metro Police investigated Galardi.

A separate application to operate an adult cabaret was reviewed by county Business Licensing Director Jaqueline Holloway, who county code dictates has exclusive purview of those requests, Dubasik said. Holloway did not return phone calls from the Sun on Tuesday.

The Leopard Lounge currently does not have any of the necessary licenses to operate a business at its present location, although Galardi could still apply for an erotic dance permit at the facility, Dubasik said. By Tuesday afternoon, no application for such a permit had been filed, he said.

Dubasik would not comment on the potential legal action other than to say "there's a difference of opinion" between the parties.

Jack Galardi is the father of Michael Galardi, who in September 2003 pleaded guilty to political corruption amid charges he bribed elected officials in San Diego and four former Clark County commissioners.

Coe and Gentile have argued that when making the decision to deny the license, the current commission improperly considered the alleged transgressions of the younger Galardi, who sold his interests in the Leopard Lounge and two other Las Vegas clubs to his father when he pleaded guilty.

Dubasik denied the claim, saying investigators' reports made no mention of Michael Galardi.

"The information presented to the Liquor and Gaming board did not include any issues of Michael Galardi or any ownership that Michael Galardi had pending in reference to any partnership he had with his son," Dubasik said. "The items were strictly related to Jack Galardi."

Among the disagreements were allegations by Coe and Gentile on Tuesday that Metro had overcharged Galardi for lap dances Det. Jeffrey Welte and another undercover investigator received as part of their investigation at his clubs in Tampa, Fla., Atlanta and Forest Park, Ga.

The detectives' report capped a lengthy investigation into Galardi, which lasted more than a year.

Welte declined to comment on the investigation. Sgt. Anthony Arnone, who oversees Metro's special investigations section, would not name the undercover detective, saying it could jeopardize his work in Las Vegas and elsewhere.

County policy dictates that applicants for a privileged license, which includes tavern permits, must undergo a police background check that often includes travel to any other businesses they may operate, Arnone said. The travel expenses, including an $80-an-hour "investigator fee," are paid by the applicant.

According to an itemized accounting of the officers' trip, the detectives spent $1,130 on lap dances at the four clubs. Metro received from Galardi more than $20,000 total for the trip.

Arnone disputed claims by Coe and Gentile that the lap dance charges were excessive, saying it included cover charges to enter more exclusive VIP rooms, where detectives said the violations occurred.

"You can get the $20 lap dances but these clubs want you to spend $150 to go to the VIP rooms," Arnone said. "... A lot of things don't occur in the main showroom but go on in the VIP room. Girls (dancers) don't make money doing the $20 lap dances, they want to get you to the VIP room."

Coe said she had been demanding a more detailed account of the detectives' expenses during the four-day trip to no avail. Arnone said he had not been contacted by Coe or Gentile other than to field the initial request for the breakdown.

"We'll be asking some questions as to how they've researched other applicants," she said. "It's a very arbitrary system here. It really needs to stop if it's going to be a place corporations and people can count on their business going according to the rules."