A federal judge and jury are scheduled to hear arguments next month that should put an end to a several-year dispute between the city of Davenport and the owner of Chorus Line strip club.
The case so far has cost the city more than $80,000 in legal fees, records show, which does not include the in-house legal representation the city used during hearings in state court.
In the latest ruling, a federal judge said the city of Davenport and co-defendant Craig Malin, city administrator, violated the club owner’s due-process rights when the city refused to allow the cabaret to continue operating after a new owner took over in 2009. In his Aug. 2 ruling, Judge Robert W. Pratt said the city is liable for damages, or loss of profits, incurred during the yearlong closure of Chorus Line.
A jury is expected to hear arguments in the case, beginning Sept. 16, and possibly award damages to the cabaret owner.
Among other rulings related to the case, Pratt said he will use the five days set aside for the case to rule on whether the city committed civil contempt by failing to comply with a consent decree that granted Chorus Line the right to operate in the first place. The 2004 consent decree gave the cabaret the right to legally operate, even if it switched ownership. The business did, in fact, change ownership, but city officials said the license had been transferred to a neighboring adult business, and Chorus Line was forced to close.
The neighboring business, Dr. John’s Lingerie, however, was operating on a retail license, not an adult-business license.
If the city and Malin are found in contempt, the judge could issue sanctions ranging from a fine to a simple admonishment.
Also in September, Pratt must determine the amount in attorney fees owed Chorus Line by the city. Records show the city has been billed $80,971 by Davenport law firm Lane & Waterman for representation during the federal case that began two years ago.
The Chorus Line’s attorney, Mike Meloy, said he is working on a set of figures to present in court, regarding the losses his client will claim for the period in which the cabaret license was withheld.
He said the Chorus Line’s biggest victory in the recent rulings is the judge’s finding that the city violated the strip-club owner’s right to due process, declaring the city legally liable for any damages.
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“The ruling eliminates that issue at trial,” Meloy said. “In September, we’ll go right to the amount of damages.”
The city’s attorney, Rand Wonio, said his clients were pleased with parts of Pratt’s ruling and may appeal others.
“The city strongly contests C. Line’s lost-profit claims,” he said of possible damage-amount claims. “A certified public accountant has audited C. Line’s business records and found that there was missing information, especially expenses and sales tax payment records.”
Asked how much his client lost in profits, Meloy said, “We’re working on that right now.”