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Strip club law prompts lawsuit

March 27th, 2013

A lawyer for owners of a strip club that sits halfway completed on Route 9W in the Middlehope section of the Town of Newburgh has carried out his threat of legal action against the Town of Newburgh and the individual members of the Town Board.

John C, Cappello, of Jacobowitz & Gubits, LLP, and a second lawyer, Luke Lirot, filed legal papers last week in federal court alleging that the town’s actions effectively sabotage the Mansion Gentlemen’s Club & Steakhouse owned by Santa Monica Holdings. Also participating in the suit are Exotic Island Enterprises Inc. and Sliffer Enterprises, both of Newburgh.

After gaining approval from the Town Board, the Town Planning Board and the Zoning Board of Appeals, the applicant began construction of the 6,000-square-foot club on the site that previously housed another strip club known at various times as the Blue Moon and Fantasy Island. Everything had been obtained except a final building permit.

In December 2011, residential neighbors began protesting the strip club, saying they had been unaware that it would be so intrusive. A campaign was launched to try to head off completion of the club. Petitions were circulated and residents began appearing regularly at Town Board meetings pleading for protection of the “community.”

Momentum built until the Town Board ordered a six-month moratorium on further construction while they studied the impact of the club on the community. During the six months, a proposed ordinance was crafted that effectively would restrict clubs of this type to several locations in the town.

The attorney for the club warned that his client has spent hundreds of thousands of dollars to reach this point in the construction and a ban would cost him millions.

Town of Newburgh officials used extreme care this past year deciding whether to go ahead with that town ordinance. During the process, the lawyer for Santa Monica Holdings warned them of the likelihood of a lawsuit if they persisted in putting up barriers to the company’s strip club.

In the end, the Town Board passed the ordinance — and this past week, attorney Cappello filed the promised lawsuit against the Town of Newburgh and each of the five members of the board, Supervisor Wayne Booth, Deputy Supervisor Gil Piaquadio, Councilwoman Elizabeth Greene and Councilmen George Woolsey Sr. and Ernest Bello.

In September 2012, Cappello, after presenting the board with a list of the reasons they should not go forward with the ordinance, warned them they were in dangerous territory.

Cappello said then that he had appeared before the Town Board for more than 20 years and was always treated with respect.

“Sometimes I’ve had success in this town and [other times] I have had projects that didn’t go through. All of the other times, the reasons [the projects] were rejected were valid and I moved on, but this issue we’re discussing tonight is really treading on thin ice. I need to tell you, I’ve presented you a package of the facts. I am not going to come here and just issue you with empty threats.

“I’ve presented you with a mountain of evidence regarding the long procedures this applicant has gone through before your board. But a townwide moratorium ignores the history of what has been going on before your town the past 18 months.”

That night the Town Board authorized preparation of an introductory local law. It was the first of a number of careful steps taken by the board to limit construction of strip clubs and other adult sites in the Town of Newburgh.

Whether that care will limit the town’s liability is now in the hands of federal court Judge Cathy Seibel.

The litigants are claiming the town’s code inspectors have cited the club needlessly and that the new law violates the owners’ constitutional rights. They also say that the ordinance would reduce the value of the property so much that it represents improper taking of Santa Monica Holdings’ property.

Under the new law, property owners with adult clubs located in forbidden areas would be required to move within a two-year period, although there is a clause in the law that would allow for a single, one-year extension.

Booth was unavailable for comment late Tuesday.


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