BEFORE THE LIQUOR CONTROL COMMISSION OF THE STATE …...the Downtown Deli & Greek Cusina, from January 2007 through April 26, 2008? 2. Whether Licensee has demonstrated a willingness

Page 1 of 39 –Amended Final Order

BEFORE THE LIQUOR CONTROL COMMISSION

OF THE STATE OF OREGON

In the Matter of the Full ) AMENDED FINAL FINDINGS OF

On-Premises Sales License Held By: ) CONCLUSIONS OF LAW

) AND ORDER

Downtown Delicatessen, Inc. ) OLCC-08-V-028

Ted Papas, President ) OLCC-08-V-028A

John Papatheodorou, Secretary ) OLCC-08-V-028B

dba DOWNTOWN DELI & )

GREEK CUSINA )

404 SW Washington Street )

Portland, OR 97204 )

HISTORY OF THE CASE

On March 21, 2008, the Oregon Liquor Control Commission (OLCC or Commission) issued a Notice of Proposed License Cancellation to Downtown Delicatessen, Inc. (Licensee), Ted Papas, President and Stockholder and John Papatheodorou, Secretary and Stockholder, doing business as Downtown Deli & Greek Cusina. The Notice alleged that there is a history of serious and persistent problems at the licensed premises under ORS 471.315(1)(c). Licensee timely requested a hearing. The hearing request was referred to the Office of Administrative Hearings on May 2, 2008. On June 26, 2008, the Commission issued an Amended Notice of Proposed License Cancellation and Notice of Proposed Refusal to Renew License. The Commission notified Licensee of additional serious incidents at the licensed premises and also alleged that, pursuant to ORS 471.313(4)(g), it was proposing to refuse to renew Licensee’s license because of Licensee’s poor record of compliance with the liquor laws and Commission’s rules. The case was assigned to Administrative Law Judge (ALJ) Alison Greene Webster of the Office of Administrative Hearings. A prehearing telephone conference was held on August 11, 2008. The hearing was held in Tualatin, Oregon on February 2, 3, 9, 13 and 18, 2009, before ALJ Webster. OLCC was represented by Case Presenter Kelly Routt and Licensee was represented by Victor Calzaretta, Attorney at Law. OLCC called the following witnesses: Portland Police Bureau Sergeants Christopher Davis, Matthew Engen, David Michaelson, Jeff Niiya, and Timothy Robinson; Portland Police Bureau Officers Susan Abrahamson, Max Anuschat, Derek Carmon, Branden Combs, Matt Delenikos, Robin Dunbar, Stacy Dunn, Sterling Farrar, Mark Friedman, Andrew Griggs, Kimberly Hecht, Casey Hettman, Brian Hubbard, Jason Hubert, Michael Kuenzli, Matt Manus, Amanda McMillan, Sherry Murray, Mitchell Orellana, Curtis Pak, Aaron Schmautz, Steven Sharp, Darrel Shaw, Michael Strawn, Todd Tackett, Jennifer Thompson, Crystal Viuhkola, Matt Wells, Ryan Whitcanack, Deshawn Williams and Jason Worthington; City of Portland Noise


Control Officer Paul Van Orten; and OLCC Inspectors Kevin Wellman and Jackie Paul. The following witnesses testified on Licensee's behalf: Ted Papas and Ryan Newman. The record remained open for closing arguments, which were presented during a February 18, 2009 telephone conference. The record closed on February 18, 2009. The Administrative Law Judge considered the record of the hearing and the applicable law and issued a Proposed Order mailed April 17, 2009.

Licensee filed Exceptions to the Proposed Order on April 29, 2009. Staff filed Comments on the Proposed Order on May 1, 2009. The Administrative Law Judge responded to Licensee’s Exceptions and Staff’s Comments on June 1, 2009. On June 18, 2009 and August 21, 2009, the Commission considered the record of the hearing, the applicable law, the Proposed Order of the Administrative Law Judge, Licensee’s Exceptions to the Proposed Order, Staff’s Comments on the Proposed Order and the Administrative Law Judge’s Response to Licensee’s Exceptions and Staff’s Comments. Based on this review and the preponderance of the evidence, the Commission entered a Final Order in this matter on August 28, 2009. On September 23, 2009, Licensee filed a request for reconsideration of the Final Order.1 On October 15 and 16, 2009, the Commission considered the Final Order and Licensee’s Petition for Reconsideration. Based on this review the Commission entered the following:

EVIDENTIARY RULINGS

Pleadings A through F were received. OLCC Exhibits A1 through A66 were admitted.2 Licensee's Exhibits 107 through 132, 134 through 141, 144 through 154, 161, 162 and 165 were admitted.

ISSUES

1. Whether there was a history of serious and persistent problems at Licensee’s premises, the Downtown Deli & Greek Cusina, from January 2007 through April 26, 2008?

2. Whether Licensee has demonstrated a willingness and ability to control the premises

since April 2008. 3. If a violation of ORS 471.315(1)(c) is found, what is the proper penalty?

1 Licensee’s request for reconsideration was limited to the restriction requiring five DPSST certified staff on Thursday, Friday, and Saturday nights from 8:00 pm until closing. The Commission has modified that restriction herein for the alternative set of restrictions applicable to the election no longer to use the third floor for the sale, service, or consumption of alcohol. 2 Exhibits A1, A2, A41 and A42 were admitted over Licensee's relevancy objections.


4. Whether Licensee’s license should be renewed because Licensee has overcome a poor

record of compliance when previously licensed by showing it is not a poor risk for compliance with OLCC laws and rules.

FINDINGS OF FACT

1. Downtown Delicatessen, Inc., Ted Papas, President, and John Papatheodorou, Secretary, have held a Full On-Premises Sales license at Downtown Deli & Greek Cusina, 404 SW Washington Street, Portland, Oregon, since May 1987 and at all times relevant to this proceeding. (Ex. A57.) 2. At all times pertinent to this action, the licensed premises included a restaurant, a delicatessen, and two floors used as banquet halls and a night club. When the licensed premises first opened at this location in 1987, it occupied two floors. The first floor housed the delicatessen and restaurant. On weekend nights, Licensee used the second floor for the “Greek Show,” a dinner show involving Greek dancing, belly dancers and traditional Greek music. In 1995, Mr. Papas and Mr. Papatheodorou purchased the entire building and, after remodeling and upgrading, Licensee expanded to three floors. On weekends, the third floor was used for parties and banquets and, later in the night, a night club and dance floor open to the public. Similarly, after the Greek Show ended at approximately 11:30 p.m., the second floor became a night club and dance floor. After the remodel, when utilizing all three floors, Licensee had the capacity for a customer flow of approximately 1000 patrons on a weekend night. The second and third floors each had the capacity for approximately 300 patrons at a time. (Test. of Papas). 3. Prior to the violations alleged in this matter, Licensee had relatively few liquor law violations in the past 22 years. In 2004, Corporate principal Papas served alcohol without a permit. In 2006, Licensee changed the principal use of a room without approval in violation of OAR 845-006-0480(2). And, in December 2006 and March 2007, Licensee advertised in violation of OAR 845-007-0020(2). (Exs. A57, A62 and A63.) 4. Although Licensee had few violations over the last 22 years, since 2003 the Commission has issued “verbal instructions” to Licensee on several occasions. OLCC inspectors issued verbal instructions to Licensee when they received police reports or other information about potential liquor law violations in or around licensed premises. According to OLCC’s records, between June 2003 and December 2006, Licensee was warned 14 times about reports of disorder, minors in prohibited areas, and/or “over service.”3 (Ex. A30; test. of Paul.) 5. In August 2006, corporate principal Papas and the then premises’ manager met with OLCC Regional Manager Janice Kindrick, OLCC Inspector Jackie Paul and officers from the Portland Police Bureau to discuss recent incidents of assaults, fights and the alleged over service of patrons at the licensed premises. The inspectors warned Licensee about having a history of

3 According to Inspector Paul, “over service” means that a patron has been served alcoholic beverages to the point the patron shows signs of visible intoxication. (Test. of Paul.)


serious and persistent problems at the premises. Shortly after that meeting, Papas submitted a list of measures that Licensee had implemented to reduce problems at the premises. Licensee’s control plan included the following: retraining staff to exercise patience, diplomacy, courtesy and non-threatening conduct with problematic customers; 11 DPSST licensed security staff; two alcohol monitors watching for visibly intoxicated patrons; security staff wearing yellow shirts identifying them as security; bartenders to avoid selling multiple drinks to one person; security staff to remain in communication through radios; food service until 1:45 a.m.; continue to maintain a strict dress code; signs at the entrance prohibiting reentry; owners always present during business hours; use counters to avoid overcrowding; maintain use of 16 surveillance cameras; retrain staff on checking identification and the acceptable forms of identification; maintain an incident log; use wristbands and mark an x on the wristbands of patrons who should no longer be served alcohol; call cabs for intoxicated patrons and promote the use of cabs; use metal detectors; and conduct regular staff meetings. (Exs. A30 and A56; test. of Paul.) 6. At approximately 2:00 a.m. on January 20, 2007, Licensee’s security staff escorted an intoxicated patron, Poindexter, out of the licensed premises because he was harassing other patrons. Poindexter became angry with security staff and threatened to shoot them. Poindexter left the club, but returned to the entrance a short time later. He continued to threaten Licensee’s security staff. Security staff subdued him with pepper spray and called the police. Officers responded and took Poindexter into custody at gunpoint at SW 4th and SW Alder, a block from the licensed premises. They cited him for criminal disorderly conduct and transported him to a detoxification facility (detox). (Ex. A1; test. of Hubbard and Davis.) 7. At approximately 2:24 a.m. on January 25, 2007, an intoxicated patron started a fight while leaving the licensed premises. Licensee’s security staff attempted to calm him, but he began fighting with them. Security staff called the police. Officers responded and took the patron into custody because of his intoxication level and inappropriate behavior. The officers transported the patron to detox. (Ex. A2, test. of Whitcanack.) 8. At approximately 1:42 a.m. on February 11, 2007, Portland police officers responded to the licensed premises regarding an assault inside the club. When the officers arrived, a male patron, Shokriyany, reported that he had been punched in the face by another patron, a tall black man, for no reason. Shokriyany was visibly intoxicated and had scratches around his left eye. Witnesses said that Shokriyany intervened in a fight between the other man and a female patron, Morgan. Officers located Morgan, who was also very intoxicated. She denied fighting with anyone and did not want to file a report. She claimed that Shokriyany, whom she did not know, had assaulted her. Officers were unable to find the alleged instigator. Officers were also unable to determine exactly what happened because security staff did not witness the incident and the patrons interviewed were intoxicated and provided differing versions of what had occurred. (Ex. A4; test. of Orellana). 9. Meanwhile, at around the same time on February 11, 2007, another intoxicated female patron created a disturbance and got violent with security staff when asked to leave the premises. The woman refused to leave. She told the officers that she had been celebrating a friend’s


birthday at the licensed premises and that she had been getting served “all night long.” Officers transported the woman to detox for her safety. (Ex. A3; test. of Griggs.) 10. On February 23, 2007 the City of Portland issued Licensee a noise citation for excessive noise at approximately 12:20 a.m. on February 21, 2007. A neighboring business had complained about the noise coming from the licensed premises. Licensee paid the $300 fine in May 2007. (Ex. A6; test. of Van Orten.) 11. On March 2, 2007, Inspector Paul contacted Licensee’s then-manager, Jessica Collins, about the police reports of incidents at the licensed premises on January 20, January 25 and February 11, 2007. Inspector Paul issued verbal instructions regarding disorder and over service. (Exs. A5 and A30.) 12. At approximately 12:35 p.m. on March 10, 2007, Chase Lunceford contacted the Portland Police by telephone to report that, approximately eleven hours earlier, he had been assaulted by a female bouncer at the licensed premises. Lunceford asserted that the bouncer pushed him down a stairwell. He claimed that, as a result of the fall, he suffered a laceration to his head, requiring 20 stitches, and scrapes to his elbows and knees. (Ex. A7; test. of Strawn.) 13. When Inspector Paul received this police report, she contacted Licensee’s manager about the incident. The manager denied that security staff pushed Lunceford down the stairs. She reported that Lunceford had been harassing female patrons. She explained that, when security staff approached him, he lunged towards them, lost his balance and fell down the stairs. The manager added that Lunceford had been “86’d” from the premises. (Ex. A9.) 14. At approximately 11:30 p.m. on March 31, 2007, there was an altercation inside the licensed premises during which a patron, Nekvapil, struck another patron, Pottle, in the head with a beer bottle. Witnesses reported that trouble ensued between the two men when Nekvapil tried to “hit on” Pottle’s girlfriend. Nekvapil struck Pottle with the bottle two or three times, causing the bottle to shatter. Nekvapil also struck Pottle’s girlfriend before security staff intervened to break up the fight. Nekvapil fled the premises with security staff chasing him. He was apprehended by the police two blocks from the licensed premises. Pottle suffered lacerations to his left brow area and the left side of his head. Both lacerations required stitches. Pottle also complained of pain and swelling around his jaw. (Ex. A8; test. of Kuenzli.) 15. On April 7, 2007, after receiving police reports on the March 10, 2007 and March 31, 2007 incidents, Inspector Paul issued verbal instructions regarding disorder inside the licensed premises. (Ex. A9.) 16. At approximately 2:40 a.m. on May 24, 2007, Licensee’s security staff contacted the police to take a patron to detox. The patron had urinated in a hallway of the licensed premises. Officers took the patron into custody and transported him to the detox center, because he was too intoxicated to care for himself. The patron said he had consumed three drinks at the licensed premises in addition to some gin. (Ex. A10; test. of Viuhkola.)


17. At approximately 2:12 a.m. on July 8, 2007, Licensee’s security staff called the police about an intoxicated patron who had been involved in a verbal altercation inside the premises. When security staff told the patron to leave, he became hostile and combative. Security staff had to forcibly escort him from the premises. Once outside, the patron began smashing his head against the glass windows. Security staff restrained the patron until the officers arrived. The officers took the patron into custody and transported him to detox upon a determination that he was too intoxicated to care for himself. (Ex. A11; test. of Friedman.) 18. At approximately 1:20 a.m. on July 13, 2007, officers responded to the licensed premises about an assault. The complainant, a 20 year old female, said that her ex-boyfriend slapped her and then took off. The female said she had been inside the Greek Cusina drinking with friends when she began arguing with her ex-boyfriend. She said that as they were leaving, her ex re-contacted her on the sidewalk outside the premises and slapped her. The complainant denied medical aid. She told the officer that she was not in pain because she was drunk. (Ex. A12; test. of Worthington.) 19. At approximately 1:30 a.m. on July 14, 2007, officers responded to a disturbance at the licensed premises. Upon arrival, they were told that a male patron had been harassing female patrons on the third floor. The officers learned that when security staff asked the patron to leave, he became combative. Security staff used physical force to take him to the ground and subdue him. The patron suffered a bloody nose in the scuffle. One staff member received scrapes to his knees and elbows during the incident. The officers determined that the patron was very intoxicated and took him to detox. (Ex. A13; test. of Schmautz.) 20. At approximately 1:30 a.m. on July 28, 2007 officers responded to a fight inside the licensed premises. Approximately 10 patrons were involved in a physical altercation with security staff. Several of these patrons were visibly intoxicated. Officers took at least one patron to detox. Another patron, Gonzalez, was arrested and charged with assault. As officers were escorting the combatants from the premises, an unruly crowd gathered at the exit and sidewalk. Officers directed the patrons to clear the area. A visibly intoxicated female, Dillon, refused to leave and began yelling at the officers. She then lunged at and shoved Officer Hecht. Other officers took Dillon into custody for harassment and interfering with a peace officer. (Ex. A14; test. of Dunn, Hecht, Delenikos, Robinson, Manus and McMurray.) 21. At approximately 1:30 a.m. on July 29, 2007 a citizen flagged down officers to report a fight near the entrance to the Greek Cusina. The officers arrived and saw two men in handcuffs being held down by Licensee’s security staff. The officers were advised that the two men had been in the premises earlier, but had left and then were denied reentry. One of the two men, George, became angry and belligerent and threatened security staff. He also spit on one of the bouncers. When security staff took George to the ground, his friend intervened, prompting security to take him into custody as well. The officers noted dried blood and the beginnings of a “goose egg” on George’s forehead, but he denied medical attention. The officers cited George for harassment, and took him onto custody on a warrant. The other man was released. (Ex. A15; test. of Abramson; test. of Viuhkola.)


22. In August 2007, Licensee’s new general manager, Ryan Newman, contacted Inspector Paul to follow up about the Commission’s concerns of over service and assaults at the licensed premises. Inspector Paul asked Newman about several police reports, documenting investigations of incidents at, or involving, the licensed premises occurring between July 17, 2007 and August 5, 2007. In early September, Newman responded, providing Inspector Paul with the write ups from Licensee’s security log about the incidents of which Licensee was aware.4 On September 13, 2007, Inspector Paul sent Newman OLCC’s rules regarding disorder, ejecting unruly patrons and visibly intoxicated persons. (Ex. A16; test. of Paul; Exs. 140, 141.) 23. Meanwhile, at approximately 2:38 a.m. on September 3, 2007, Eddie Santos flagged down two officers to report an incident occurring at the licensed premises earlier in the night. Santos was angry because security staff had asked him to leave the premises. He reported being dragged downstairs and pushed out the door. The officers had seen Santos leaving the club. They also saw him punch a tree with his right hand, so they did not believe his claim that he had injured his hand in an altercation with security staff. Santos appeared intoxicated, based on his slurred speech and watery and bloodshot eyes. (Test. of Shaw; Ex. A17.) 24. At approximately 1:47 a.m. on September 9, 2007, Licensee’s security staff flagged down officers to report trouble with a group of females who had been asked to leave the premises. The women were being combative and yelling at security. A member of the security staff reported that one woman, Brazzly, had attacked him and scratched his neck. When interviewed by the officers, Brazzly admitted that she scratched the security guard, but claimed it was inadvertent. The officers cited her for harassment. (Test. of Pak; test. of Abramson; Ex. A18.) 25. In the early morning hours of September 22, 2007, a patron was assaulted inside the licensed premises. While on the dance floor, the patron was “sucker punched” on the side of the head by another patron. The patron suffered a non-displaced skull fracture and internal bleeding on the brain. He was transported to the hospital via ambulance. He reported the assault several hours later, while being treated at Emanuel Hospital after the incident. Licensee’s security staff witnessed the assault, but it was not captured by the surveillance camera. (Test. of Williams; Ex. A19; Ex. 144.) 26. On the morning of September 23, 2007, a woman (Hollie) contacted the Portland Police to report that she had been drugged at the licensed premises earlier that morning. She told the officer that she had had one drink and started drinking a second when she passed out with her head down on the bar. The woman’s friend, who was with her at the bar, reported that Hollie became uncharacteristically mean and loud before she passed out. The friend reported that Licensee’s bouncers carried Hollie down to her car. The friend then drove Hollie to the hospital. Hollie reported that she was told by hospital staff that she had been in a “medical coma” for

4 Two of the police reports Inspector Paul asked about involved DUII arrests, where the arrested person indicated that he or she had been drinking at the licensed premises. Newman advised Inspector Paul that Licensee was not informed of the DUII arrests, and had no record of these patrons in the incident log. (Ex. A16 at 2-3.)


about two hours. Her blood alcohol content was measured .076 percent, but her toxic screen was otherwise negative. Hollie also reported that hospital staff told her that her symptoms were consistent with her having taken Ketamine, which would not have registered on the toxic screen. Hollie believed that someone she met at the bar slipped something into her drink. (Test. of Farrar; Ex. A20.) She later sent an email to OLCC detailing what had happened to her and complaining about how Licensee’s staff handled the incident. (Ex. A21.) 27. At approximately 12:30 a.m. on September 29, 2007 officers responded to a disturbance at the premises. They learned that a patron, Brennfleck, had been harassing and inappropriately touching female patrons and became angry and combative when asked to leave. Security staff reported that they had to physically pull Brennfleck onto the elevator, that he started swinging at them, so they used control holds to push him down and handcuff him. Once outside the premises, Brennfleck left with his brother before the police could contact him. Several hours later, however, Brennfleck contacted the police to report that he had been assaulted by security staff in the elevator. He had bruises and scratches to his face and neck, including a round bruise near his right eye in the shape of a shoe print. (Test. of Schmautz; test. of Thompson; Ex. A22.) When OLCC inspectors later asked Licensee’s staff about the incident, the manager reported that Brennfleck was thrashing around in the elevator as security staff tried to restrain him, and he fell forward and landed on his face. (Ex. A23.) 28. At approximately 2:30 a.m. on October 14, 2007 officers responded to another disturbance at the licensed premises. A male patron, Alahmadi, had harassed a female patron by grabbing her hips and licking her face. Security staff had Alahmadi in custody when the officers arrived. Officers arrested him for harassment and transported him to the Multnomah County Detention Center. (Test. of Worthington; test. of Schmautz; Ex. A24.) 29. While visiting the premises on October 17, 2007, OLCC inspectors noticed a prohibited advertisement for alcoholic beverages on the sidewalk in front of the premises. Two days later, Inspector Wellman issued verbal instructions to Licensee’s manager and corporate principal Papas about the improper advertisement. (Ex. A23.) 30. At approximately 1:25 a.m. on November 1, 2007, officers responded to the licensed premises to investigate an assault. When the officers arrived, security staff already had a patron, Evans, in custody. Evans had been harassing a female patron. When she told Evans to stop and leave her alone, he got angry and punched her in the face. She fell backwards and hit her head against something when she fell. The female patron also sustained a cut across the bridge of her nose and multiple bruises on her face, around her eyes and nose. When the officers contacted Evans, he was intoxicated, angry and belligerent. Officers saw him spit on a security guard. The officers arrested him for assault and harassment. Even while in police custody, Evans was disruptive and violent. He also spit on Officer Worthington as the officers escorted him into the jail. (Test. of Schmautz; test. of Worthington; test. of Niiya; Ex. A25.) 31. At approximately 12:56 a.m. on November 4, 2007 officers responded to the licensed premises to assist security staff with a disturbance and assault. A couple began arguing while inside the premises. Security staff escorted them from the premises. They continued to argue


while standing in the street near the premises. There, the male patron hit the female in the face and knocked her down. Officers arrested the male patron, Prevost, for domestic assault. The female patron advised the officers that they were fighting because she was drunk. She said she did not want to press charges. (Test. of Worthington; test. of Schmautz; test. of Niiya; Ex. A26.) 32. At approximately 2:18 a.m. on November 11, 2007, officers responded to an assault at the licensed premises. An altercation occurred on the dance floor because one woman was bumping into another while dancing. The two woman dumped water on each other. Then, the husband of one the women grabbed the other women by her hair and pushed her to the ground. The other woman’s cousin confronted him, and he grabbed her by the throat and punched her. She sustained red marks on her neck, and redness and swelling around her nose. Security staff detained the husband and called officers, who arrested him for two counts of assault. He was very intoxicated, and admitted to Officer Combs that he had had a lot to drink. (Test. of Combs; Ex. A27; Ex. 112.) 33. On November 27, 2007, Inspector Paul contacted Licensee about recurring problems at the licensed premises. She spoke with premises manager Newman. Newman said he was aware of the fights and disturbances. He reported that Licensee recently held a staff meeting to refocus and retrain staff to deal with problem patrons. Newman also noted that Saturday nights have been busier recently, due to changes in other area bars. Newman promised to review the control plan that Licensee submitted in 2006 and determine what changes could be implemented to improve patron safety. Newman also promised to write up a new plan and submit it to the Commission. (Ex. 30.) 34. At approximately 12:18 a.m. on December 1, 2007, one of Licensee’s employees, Reiland, allowed a group of six persons to enter the bar area, but only checked the identification of one member of the group. All six persons appeared to be young, under the age of 26. Officer Tackett entered the bar and asked to see the identification of the others. Four of the five persons presented identification showing that they were at least 21 years of age. The other person did not have identification. Officer Tackett then spoke to Theo Papas about the employee’s failure to check identification of everyone in the group. Papas assured Tackett that he would address the problem, and it would not happen again. Tackett later learned that this employee, who appeared to be performing security tasks at the premises, was not certified by the Department of Public Safety Standards and Training (DPSST). (Test. of Tackett; Ex. A28.) 35. At approximately 2:52 a.m. on December 2, 2007, officers responded to a fight in front of the Rialto, one block south of the licensed premises. Several people were fighting when the officers arrived. Two women were beating and kicking a third woman, who was down on the ground. One of Licensee’s security staff was there, trying to break up the fight. The officers separated the women involved in the fight. The officers learned that the women had just left the Greek Cusina. The women had been arguing earlier, while inside the premises. The victim in the fight had been asked to leave, because she was arguing with another patron, a friend of the two women who later attacked her as she was walking to her car. The victim in the fight sustained swelling around the temple and eye. Officers arrested the two women who instigated the physical altercation for assault III. (Test. of Friedman; test. of Schmautz; Ex. A29.)


36. At approximately 12:11 a.m. on December 8, 2007, while on a walk through at the Greek Cusina, Officers Schmautz and Tackett saw Licensee’s employee Reiland allow a patron enter the premises without presenting identification. The officers saw another employee chase the patron down and tell him to leave because he did not have the bracelet required for entry. Schmautz contacted manager Theo Papas to report that Reiland was allowing people to enter without checking identification. Papas assured Schmautz that he would be removing Reiland from the door. Papas also said that Reiland would not be performing any duties requiring DPSST certification. About five minutes later, Schmautz saw Reiland at the door performing security duties, including looking in purses and patting down patrons. Papas was standing next to Reiland, watching him perform the security duties he was not certified to perform. Papas later advised Schmautz that he would be firing Reiland after his shift. (Test. of Schmautz; Ex. A31). 37. On the afternoon of December 10, 2007, a woman flagged down Portland police officers outside Northeast Precinct to report that she had been assaulted while at the licensed premises in the early morning hours of December 8, 2007. The woman reported that she and three girlfriends had gone to Greek Cusina around midnight. She admitted that she was intoxicated at the time. She said that while at the licensed premises, an unknown male patron bought her a drink and she danced with him. When she said no to another dance with him, he became agitated and aggressive. She reported that once she and her friends left the club, the unknown male patron followed them out and continued harassing her. She said that when she tried to push him away, he hit her in the face and knocked her down, causing her injury. Officers took photographs of cuts and bruises on her face and lips, and her front chipped teeth. Officers contacted one of the woman’s friends, who provided a similar account of the incident. Officers were unable to identify the suspect male patron, however. (Test. of Dunbar; Ex. A34.) 38. At approximately 1:31 a.m. on December 9, 2007, officers responded to an assault at the licensed premises. A male patron, Tambo, inappropriately touched a female patron as she was walking down the hallway to the ladies room. The woman responded by yelling at and hitting him. The woman’s boyfriend, Davis, saw her fighting with Tambo. Davis intervened, intending to shove Tambo against the wall. Instead, he shoved Tambo against the bathroom door. The door swung open and the both men fell into the bathroom, with Davis on top of Tambo. They were fighting on the bathroom floor when security intervened and separated them. All three parties involved in this incident were intoxicated. At least one of the eyewitnesses was also very intoxicated. Officers elected not to make any arrests, but they provided complaint information to the parties. Tambo was transported to the hospital. (Test. of Hecht; Ex. A33.) 39. On December 12, 2007, corporate principal Papas and Licensee’s bar and security managers met with OLCC Manager Kindrick, Inspector Paul and Portland Police Sgt. Niiya to discuss the ongoing problems of disorder, assaults and “over service” at the licensed premises. Licensee’s manager did not bring a new control plan, but he reported Licensee had implemented most of the measures on the August 2006 plan. They discussed each item from the August 2006 control plan line by line. Noting that the majority of problems occurred between midnight and 2:50 a.m., Kindrick suggested that Licensee make other changes, such as limit multi-shot drinks after midnight and/or double the price of multi-shot drinks after midnight, turn up the lighting,


start a soft close much earlier, and change the music tempo or format. Licensee’s manager promised to try the suggestions, and to submit a written list of implemented changes. At the conclusion of the meeting, Manager Kindrick warned Licensee that it had a history of serious and persistent problems, and that what happened from that point forward would determine Licensee’s willingness and ability to control the premises. (Ex. A30; Ex. 123.)

40. At approximately 1:49 a.m. on December 30, 2007, several officers were dispatched to a large fight at the licensed premises. Officers arrived to see 15 to 20 people scuffling with each other on the ground on the corner adjacent to the premises. Licensee’s security staff was also involved in the scuffle. They had physically detained at least three patrons by taking them to the ground, and were yelling and screaming at others to clear the area. The crowd was angry and agitated when the officers arrived, and it took seven or eight officers to quell the disturbance and control the crowd. Patrons reported that security staff had assaulted them, and security staff reported that patrons were fighting with them. Officers determined that several people got involved in an altercation at the doorway as they were leaving the premises. Patrons reported that they were part of a large group celebrating a wedding inside the licensed premises. The officers noted that many in the group were visibly intoxicated. Some were injured in the fighting. The officers arrested one person, Lopez, for disorderly conduct based upon his participation in the altercation. Within a day or two of the incident, two patrons contacted the police to complain that they had been assaulted and treated unfairly by security staff during the scuffle. Officers at the scene were also critical of the manner in which Licensee’s security handled this incident. The officers determined that security staff’s aggressive conduct incited the crowd and made the altercation worse.5 (Test. of Friedman; test. of Manus; test. of Hubert; Ex. 36.)

41. At approximately 12:10 p.m. on January 5, 2008, officers responded to investigate an assault at the licensed premises. Two patrons were involved in an altercation inside the club. A visibly intoxicated patron claimed that another patron punched him in the jaw. Officers saw no apparent injury on the intoxicated patron. The other patron denied punching the intoxicated patron. The other patron told officers that he shoved the intoxicated patron after that patron pushed him. Officers determined that the intoxicated patron probably initiated the altercation, and declined to make any arrests. (Test. of Dunn; Ex. A37.)

42. At approximately 11:57 a.m. on January 12, 2008, officers were flagged down during a walk through of the licensed premises because an intoxicated patron locked herself in the downstairs ladies’ room. Officers unlocked the door and took the patron into custody without incident. She smelled of alcoholic beverages and had slurred speech. She went limp as officers escorted her from the premises to their patrol car. Officers transported her to detox. (Test. of Wells; Ex. A38.)

5 For example, when the police first arrived, security identified a patron, Zundel, as someone who had assaulted them, so officers took Zundel into custody. Then, a bystander showed the officers digital photos from a camera phone. The photos showed Zundel acting in a passive manner with his hands up and security taking him down and pinning him to the ground. Officers then determined that Zundel was not the aggressor and released him from custody. (Test. of Manus; Ex. 36.)


43. A few minutes later on that same date, January 12, 2008, officers were called to the licensed premises about a possible assault. A patron, who was obviously intoxicated but denied being drunk, complained that he had been kicked out of the premises for no good reason, and pushed in the back by a bouncer as he was leaving. The patron admitted to drinking two Long Island ice teas and a shot of tequila. Officers interviewed the security staff who reported that the patron was asked to leave because he refused to stop smoking in the no smoking section. (Test. of Michaelson; Ex. A39.)

44. While performing a walk through of the licensed premises at approximately 1:00 a.m. on January 12, 2008, officers saw Licensee’s security staff allow a patron to enter the north side door without showing identification or a stamp or wrist band. The officers reminded the

security staffer that he was required to check the identification of all persons seeking entry to patronize the nightclub. (Test. of Tackett; Ex A41.)

45. On January 22, 2008, OLCC Inspector Paul spoke to corporate principal Papas about recent incidents at the premises. Papas indicated that he was aware of them, and was making some changes. He noted that his security staff was being retrained to be more diplomatic in their dealings with patrons. He noted that patrons sometimes get angry about being cut off, and subject his security staff to verbal abuse. (Ex. A40.)

46. At approximately 2:28 a.m. on February 1, 2008, officers were dispatched to the licensed premises. Dispatch reported there were 50 or more people involved in an altercation outside on the sidewalk. Officers arrived to find about 100 people on the front sidewalk and more patrons exiting from the premises. The crowd was highly agitated and people were yelling at each other. It took several officers to quell the disturbance and disperse the crowd from the front of the premises. The large crowd had been attending a birthday party at the licensed premises hosted by the then-Portland Trailblazer, Zach Randolph. The physical fighting began inside the premises when Randolph started arguing with some of his guests on the second floor. (Test. of Shaw; Ex. A43.) Two or three days after this incident, patrons contacted the police to report crimes. One patron reported that during the fighting upstairs, security sprayed mace and she was unable to see. She claimed that someone stole her purse. She recovered the purse, but not the items inside it. (Test. of Murray; Ex. A43.) Another patron reported being assaulted by a woman and two men as she was running out of the club when the fighting broke out upstairs. This patron reported receiving injuries during the assault, including a black eye and bite wounds. The patron’s friend, a witness to the reported assault, provided a similar account of what occurred. (Test. of McMillan; Ex. A43.)

47. Later in morning of February 1, 2008, Portland Police Officer Friedman sent Inspector Paul an email advising that there had been a “brawl” the previous night at the licensed premises involving about 100 people. Officer Friedman advised that Licensee’s security deployed pepper spray and were unable to control the crowd. (Ex. 150.) That same day, Inspector Paul spoke to corporate principal Papas. Papas called her to ask whether it was legal for his security staff to carry mace. Papas said that he had not known until he came in that morning at 10:00 a.m. that his security staff had been carrying mace, and that mace had been


sprayed around 2:20 a.m. that morning as security was escorting an uncooperative patron from the premises. Paul told Papas that it was legal for security to carry mace. Paul asked about the crowd the previous night, and Papas said that it was a group of about 120 to 150 people at a birthday party for one of the Trailblazers. Papas said there were no fights or arrests. (Test. of Paul; Ex. A44.)

48. At about 1:16 a.m. on February 9, 2008, officers responded to the licensed premises about a disturbance. A female patron had been assaulted by other women in the third floor ladies room. The patron claimed she had been hit by a glass bottle. She had a cut above her right eye through the eyebrow, a chipped tooth, and blood on her shirt. This patron was highly intoxicated, as were her friends that were involved in, or witness to, the events. Despite speaking with several patrons, officers were unable to determine who or what instigated the attack because of the patrons’ differing stories. (Test. of Schmautz; test. of Tackett; test. of Worthington; Ex. A47.)

49. On March 21, 2008, the Commission issued a Notice of Proposed License Cancellation to Licensee, alleging that there has been a history of serious and persistent problems at the premises in violation of ORS 471.315(1)(c). The Notice cited to 34 problem incidents at or in the immediate vicinity of the licensed premises between January 20, 2007 and February 9, 2008. (Pleading A.)

50. At approximately 1:14 a.m. on March 29, 2008, officers responded to an assault at the licensed premises. A male patron, Braunstein, grabbed a female patron by the hair, threw her to the ground and then kicked her several times before security staff was alerted. Braunstein ran and tried to hide in a janitorial closet, and was apprehended by security as he ran for the front door. The female patron sustained swelling and a large red mark on her cheek from the assault. Officers arrived and arrested Braunstein for Assault IV. Braunstein did not appear drunk, but instead high on drugs. He later told the officer he was “bipolar.” (Ex. A49.)

51. At approximately 2:07 a.m. on March 29, 2008, an officer was on patrol in the area of SW Third and SW Washington, a block from the licensed premises, when he saw two women running towards two men, who were fighting in the street. When the officer approached, he saw one man, Hardy, on top of the other. Hardy was rapidly punching the other man with both arms. The other man did not appear to be moving, and the officer was concerned that he was unconscious or seriously injured. The officer warned Hardy to stop, and then deployed his taser on Hardy. Hardy ignored the officer’s commands, and was tasered a second time. When cover officers arrived, they took Hardy into custody. In investigating the fight, officers learned that both men had been at the licensed premises and got into an argument over a female patron as they were leaving the premises. The victim, who had large abrasions on his back and side, reported that Hardy had “disrespected” one of the women he was with. The argument between the two men escalated to the physical fight a block from the licensed premises. Hardy was charged with disorderly conduct for engaging in the violent fighting. (Test. of Anuschat; Ex. A50.)


52. At approximately 1:50 a.m. on April 13, 2008, officers responded to an assault at the licensed premises. A female patron, who was extremely intoxicated, said that she was sitting in the lap of male patron, when another woman came up behind her, pulled her off the man’s lap and threw a pint glass as her, striking her near the left eye. The patron also asserted the other woman bit her at some point in the altercation. Officers saw swelling and bruising near the victim’s left eye, and a bite mark on her left breast. The victim claimed she was assaulted by a black female, but could not identify her attacker. Witnesses to the assault identified another patron, a white female, as the attacker. That patron was also intoxicated and unable to provide any coherent information. (Test. of Dunn; Ex. A52.)

53. On April 17, 2008, Inspector Paul contacted Licensee about the April 13, 2008 assault at the licensed premises. Employee Theo Papas said that the victim was not that intoxicated but was instead acting crazy. Theo Papas acknowledged that the victim got hit and bit by another patron, but said that security defused the problem and escorted the other patron from the premises. (Test. of Paul; Ex. A53.)

54. On April 21, 2008, Licensee applied for renewal of its license. On May 21, 2009, the Commission granted Licensee a conditional letter of authority to operate, effective July 1, 2008 to June 30, 2009 or until the Commission takes final action on the renewal application. (Ex. A59.)

55. Meanwhile, at approximately 2:00 a.m. on April 26, 2008, officers responded to an assault at the licensed premises. A male patron, Warren, began harassing a female patron after she refused to dance with him. Witnesses saw Warren flashing gang signs at the female patron and identifying himself as a Crip. Warren then hit the female patron with a glass or bottle, causing lacerations to her head. The victim was transported via ambulance to the hospital for medical treatment. Officers arrested Warren for assault. Officers also determined that Warren was only 20 years old, and should not have been allowed into the licensed premises. (Test. of Carmon; test. of Sharp; Ex. A54.)

56. In early May 2008, Licensee received a letter from the City of Portland’s Office of Neighborhood Involvement alleging recent nuisance activities at the premises in violation of the City’s time place and manner regulations for establishments serving alcoholic beverages. The letter cited to three incidents, on March 29, April 13 and April 16, 2008, where assaults or disorderly conduct occurred at the premises. By letter dated May 12, 2008, Licensee responded to the allegations and outlined the policies and procedural rules it had in place to maintain control of the premises and prevent such problems from occurring. (Exs. 103 and 162.)

57. Around this same time period, problems at Licensee’s business came under the scrutiny of a multi-agency city task force led by Portland City Commissioner Randy Leonard.6

6 Commissioner Leonard formed the task force, known as the Housing Interdiction Team or “HIT,” four or five years ago to address crime and code violations at run-down residence hotels in downtown Portland. The task force, comprised of representatives from the Police Bureau, Fire Bureau, Bureau of Development Services and the Office of Neighborhood Involvement, later expanded its focus to target restaurants, nightclubs and other downtown buildings with a record of crime and code problems. (Test. of


On May 14, 2008, the City of Portland obtained an administrative search warrant to inspect Licensee’s building for compliance with the City Fire Code. (Ex. 161.) After City Fire Inspector Alderman and Portland Police Officer Myers inspected the property, Licensee was required to close down the building’s upper floors (including the third floor banquet room) and the basement for fire safety purposes. Licensee was also required to employ a 24 hour security person on fire watch in the building. The City’s Transportation Office cited Licensee for permit violations involving the sidewalk café and the City’s Bureau of Development Services cited Licensee for failing to obtain necessary inspections after the remodeling work was completed years before. (Test. of Papas; Ex. 121.)

58. On May 28, 2008, the Commission received an unfavorable recommendation from the City of Portland on Licensee’s license renewal application. The letter noted that officers had been called to the licensed premises 14 times between January 5, 2008 and April 28, 2008 for problems including thefts, drunks, disturbances, fights and assaults. The letter also cited to incidents at the licensed premises occurring March 8 and 29 and April 13 and 26, 2008, and advised that the premises was “in jeopardy of becoming a chronic nuisance property as defined in Portland City Code 14B.60.010(A)(1)(D).” The letter concluded by proposing that, should the license be renewed, certain restrictions be imposed including: no alcohol sales after midnight, no sale of doubles or mixed drinks with more than an ounce of alcohol, no stacking of drinks or no last call; at least one alcohol monitor per floor after 8 p.m. on Thursday, Friday and Saturday nights and special event nights; at least two DPSST certified security guards on duty after 8 p.m. on Thursday, Friday and Saturday nights and special event nights. (Ex. A60.) 59. Since Licensee was required to close the third floor in May 2008, there have been significantly fewer calls for police service to, and fewer problems at, the licensed premises. Licensee has also used other measures to maintain control of the premises, including: tweaking security staff’s approach and using diplomacy with problematic patrons, emphasizing safety, requiring bartenders to be vigilant and not serve persons showing signs of intoxication, using jiggers instead of free pouring drinks, changing the music format and employing a slow or soft close to discourage patrons from all leaving at the same time. (Test. of Papas.) 60. On June 26, 2008, the Commission issued Licensee an Amended Notice of Proposed License Cancellation and Notice of Proposed Refusal to Renew License, alleging a history of serious and persistent problems at the premises during the period of January 20, 2007 to April 26, 2008. (Pleading C.) 61. In an August 2008 email to the OLCC Manager Kindrick, Licensee’s manager Kyle Gilmore outlined the changes that Licensee had implemented over the previous few months to reduce serious problems at the premises:

(1) retraining security and bar staff to improve their communication with customers; (2) strict adherence to the dress code, customer quality, doorman discretion, disc

Engen; Ex. 121.)


jockey music selection, and floor security attention to the early signs of intoxication; (3) a three drink maximum for off duty employees, with the quick and decisive stripping of that privilege at the first sign of irresponsible behavior; (4) a designated driver program that allows the designated driver free entry and free soft drinks, and prohibits the driver from ordering alcohol after 12:30 a.m.; (5) no multi-shot drinks or doubles served after 12:30 a.m.; (6) using jiggers to measure pours; (7) training security and bar staff to recognize signs of illicit behavior, and to seek out and exclude any patron engaging in such behaviors at the premises; and (8) demand every employee strictly adhere to Licensee’s policies and procedures.

In addition, Gilmore listed other measures that Licensee planned to implement to reduce problems and improve patron safety, including: becoming independent of outside event promoters; developing a strategic traffic plan that allows Licensee to shut down a floor from serving customers (if allowed access to the third floor again); and a marketing campaign that promotes a safe and responsible image. Gilmore noted that the closing down of the third floor had only resulted in a 15 percent loss in Licensee’s profit from the nightclub. Finally, Gilmore expressed Licensee’s willingness to work with OLCC to achieve its goal of being “a responsible and safe downtown restaurant/nightclub.” (Ex. 165; test. of Newman.) 62. On November 3, 2008, Portland Police Sgt. Engen accompanied Fire Inspector Alderman to the licensed premises for an inspection. There, they were met by corporate principal Papas, who expressed his displeasure about the inspection and the fire watch requirement. Initially, Papas appeared aggressive and angry, but he eventually calmed down and cooperated with the inspection. (Test. of Engen; Ex. A64.) 63. At approximately 12:55 a.m. on November 27, 2008, officers responded to a call about a man with a gun in the area of SW Fourth and SW Washington. Dispatch advised that the suspect had pulled out a gun and threatened Licensee’s security staff. Officers confronted the suspect, Flie, at gunpoint on SW Fourth, just north of the premises and took him into custody. They retrieved a .38 caliber revolver from his waistband. As short time earlier, Flie had been involved in a dispute with another patron inside the licensed premises. The other patron fled after being escorted out of the nightclub, but when security tried to remove Flie, he became angry and agitated. At some point, Flie sustained a cut over his left eye. Flie believed that it had been one of the security staffers who had hit him. Flie was still angry after being escorted out. He walked to his car, retrieved the gun and put it in his waistband. He then returned to the premises, pulled out the gun and threatened one of Licensee’s security staff. Flie was charged with being an ex-convict in possession of a firearm and menacing. Flie told the officers he got beat up inside the premises. (Test. of Dunn; test. of Shaw; test. of Sharp; Ex. A65.)

CONCLUSIONS

1. There was a history of serious and persistent problems at Licensee’s premises from January 20, 2007 through April 26, 2008.


2. Subsequent to April 26, 2008, Licensee has demonstrated a willingness and ability to

control the premises. 3. The proper penalty for the violation of ORS 471.315(1)(c) is a 30 day suspension or a

civil penalty of $4,950. 4. Licensee’s license should be renewed because Licensee has overcome a poor record

of compliance when previously licensed by showing it has the willingness and ability to control the premises, and is therefore not a poor risk for compliance with OLCC laws and rules.

OPINION

1. History of Serious and Persistent Problems

OLCC contends that based on series of problems at, or in the immediate vicinity of, the licensed premises over a 15 months period, from January 20, 2007 through April 26, 2008, it has grounds to cancel Licensee’s license pursuant to ORS 471.315(1)(c).7 ORS 471.315(1)(c) grants the Commission the authority to sanction a licensee if there has been a history of serious and persistent problems at the licensee’s premises. The statute requires that the serious and persistent problems be related to the sale or service of alcohol. The problems may include fights, altercations, harassment, and public drunkenness, among other things. Licensees may overcome the history by showing that the problems are not serious or persistent or may mitigate the penalty by demonstrating a willingness and ability to adequately control the premises and patrons' behavior.

7 ORS 471.315(1)(c) states in relevant part:

(1) The Oregon Liquor Control Commission may cancel or suspend any license * * * if it finds or has reasonable ground to believe any of the following to be true:

* * * (c) That there is a history of serious and persistent problems involving

disturbances, lewd or unlawful activities or noise either in the premises proposed to be licensed or involving patrons of the establishment in the immediate vicinity of the premises if the activities in the immediate vicinity of the premises are related to the sale or service of alcohol under the exercise of the license privilege. Behavior which is grounds for cancellation or suspension of a license under this section, where so related to the sale or service of alcohol, includes, but is not limited to obtrusive or excessive noise, music or sound vibrations; public drunkenness; fights; altercations; harassment or unlawful drug sales; alcohol or related litter; trespassing on private property; and public urination. Mitigating factors include a showing by licensee that the problems are not serious or persistent or that licensee has demonstrated a willingness and ability to control adequately the licensed premises and patrons' behavior in the immediate vicinity of the premises which is related to licensee's sale or service of alcohol under licensee's exercise of the license privilege.

Page 18 of 39 – Amended Final Order

In interpreting ORS 471.315(1)(c), the Commission has found that a history of serious and persistent problems is based on the nature and circumstances of the incidents in each case. Incidents inside the licensed premises count, whether related to sale of alcohol or not. Incidents outside do not count unless the incident is related to the licensee's sale or service of alcohol. The Commission gives significant weight to severe crimes, such as those involving drugs, violence or the threat of violence to a patron or licensee, unless the incident was isolated and happenstance. Less severe crimes, such as shoplifting, will be given little weight, unless the crime is shown to be related to alcohol. Handy Food Mart (OLCC, Amended Final Order, 91-L-020, March 1994).

For example, in DiMarco’s Restaurant (OLCC, Final Order, 04-V-043/04-V-062, October 2005), the Commission found that 11 instances of excessive noise over the course of 10 months, nine disturbances involving violence or threat of violence over the course of 13 months and three other instances of unlawful activity (i.e., public drunkenness linked to the licensee’s establishment) constituted a history of serious and persistent problems.

In La Brisa (OLCC, Final Order, 91-L-037, December 1992), the Commission found that

incidents involving persons intending to go into the licensed premises are related to the exercise of the license privilege and count regardless of whether the persons consumed alcoholic liquor on the premises. In that case, the Commission held that the language "related to the sale or service of alcohol" does not require a showing that the patron involved purchased, was served or consumed alcohol in the licensed premises. The OLCC presumed that the persons are coming to the premises because the licensee has a license and for the purpose of consuming alcoholic liquor. Id.

In Headless Horseman (OLCC, Final Order, 92-L-016, June 1993), the Commission

found that the licensed premises had a history of serious and persistent problems where the number of incidents was not large, but most of the incidents involved fights. There, the licensed premises had a history of seven problems over 13 months: three assaults or fights outside the premises involving patrons of the premises, two instances of public urination, one instance of a patron damaging shrubbery, and one instance where a patron removed from the licensed premises returned and assaulted a bartender.

Similarly, in Balzer's Pub & Grill (OLCC, Final Order, 99-V-019, March 2001), the Commission found a history of serious and persistent problems where there were five serious incidents within six months: two fights outside the premises, an assault on a security guard, the display of a gun by a patron who was denied entry to the premises, an assault and robbery upon a waitress by patrons inside the premises, and a very intoxicated person on the street outside the premises.

Furthermore, in The Hydrant (OLCC, Amended Final Order, 00-L-006, October 2001),

the Commission held that incidents resulting from a licensee's appropriate steps to deal with problem persons by refusing service and/or by removing them from the premises shall be counted among those comprising a history of serious and persistent problems. Although in cases such as La Linda's (OLCC, Final Order, OLCC-95-L-021ES, June 1996), the Commission had previously held that such instances should not count against the licensee, the Commission expressly overruled that approach in The Hydrant. It explained:


Accordingly, in the future, all such problem incidents will be counted among those compromising a history of serious and persistent problems. Each incident will be weighed according to its seriousness, as determined by the presence or absence of violence or the threat of violence directed toward persons (serious) or property (less serious). These security efforts will be considered in evaluating willingness and ability to control the problems associated with the licensed premises.

The Hydrant, Amended Final Order at 41. In Cabana Club (OLCC, Final Order, 03L-010, April 2005), the Commission confirmed that “an incident is serious when it involves violence or the threat of violence toward a person to any degree.” Final Order at 17, fn 6.

In this case, over the course of 15 months (from January 20, 2007 to April 26, 2008) there

were at least 27 documented disturbances involving violence or threat of violence (fights, altercations, assaults and/or harassment) involving patrons of the licensed premises inside, or in the immediate vicinity of the premises:8

(1) January 20, 2007: An intoxicated male patron harassed female patrons.

He became angry with security when asked to leave. The patron sought reentry after being ejected, and continued to harass and threaten security staff. Officers charged the patron with disorderly conduct and took him to detox.

(2) January 25, 2007: An intoxicated patron fought with other patrons and

security staff while leaving the premises. Officers took the patron to detox. (3) February 11, 2007: Three patrons were involved in an altercation

inside the licensed premises. At least two participants were visibly intoxicated. One sustained injuries. Those involved in the altercation provided differing accounts of what transpired, so officers were unable to determine who instigated the fight.

8 There were other alleged assaults at the licensed premises during this time, but these reported incidents are not included on the list because the evidence was insufficient to establish the assaults occurred as alleged. For example, in the incident of March 10, 2007, it is unclear whether Licensee’s security staff caused the patron to fall down the stairs or he lost his footing on his own. The patron waited several hours to report the incident to the police, and it is unknown whether his alleged injuries were documented. In another incident, the woman waited a day and a half to report that she had been harassed by an unknown male, and then hit and knocked down by him as she left the premises on December 8, 2007. Although the woman’s friend provided a similar account of the incident, officers were unable to identify a suspect. There was also no evidence to confirm that the woman’s injuries occurred while she was leaving the licensed premises.


(4) February 11, 2007: An intoxicated female patron became aggressive and violent when asked to leave. Officers took her to detox.

(5) March 31, 2007: A patron struck another patron in the head with a beer

bottle inside the premises, and then fled with Licensee’s security staff giving chase. The patron was apprehended by police two blocks from the premises. The victim required stitches for lacerations to his head.

(6) July 8, 2007: An intoxicated patron, who had been involved in a verbal

altercation with another patron inside the premises, became angry and combative when staff asked him to leave. After this patron was forcibly ejected, he began banging his head against Licensee’s glass windows. Officers took him to detox.

(7) July 13, 2007: An underage female began arguing with her ex-

boyfriend while inside the licensed premises. As they were leaving the premises, the ex-boyfriend assaulted her outside on the sidewalk. The underage female admitted that she was drunk.

(8) July 14, 2007: An intoxicated male patron who had been harassing

female patrons became combative with security staff when asked to leave. Security staff used physical force to remove him from the premises. A scuffle ensued. The patron sustained a bloody nose, and a security staffer received scrapes to his knees and elbows. Officers took the patron to detox.

(9) July 28, 2007: Several patrons were involved in a physical altercation

inside the premises. Officers took at least one patron to detox and arrested and charged another with assault. A bystander patron, who was also intoxicated, interfered with the investigation and shoved one of the officers. She was cited for harassment and interfering with a peace officer.

(10) July 29, 2007: A patron, who had been in the premises earlier in the

night, became angry and belligerent when denied reentry. The patron threatened security staff and spit on one of them. Officers cited the patron for harassment.

(11) September 9, 2007: A group of female patrons who had been asked

by security staff to leave the premises became disruptive and combative. One of the women attacked and scratched a security staffer. Officers cited the patron for harassment.

(12) September 22, 2007: While on the dance floor, a patron “sucker

punched” another patron on the side of the head. The victim sustained a non-displaced skull fracture and internal bleeding on the brain.

(13) September 29, 2007: A male patron who had been harassing female

patrons became angry and combative when security asked him to leave. Security staff had to use physical force to eject the patron from the premises. He left


before officers arrived, but contacted the police the following day to report that he had been assaulted Licensee’s security staff in the premises elevator. The patron had bruises and scratches on his face and neck, including a shoe-print shaped bruise near his right eye.

(14) October 14, 2007: A male patron harassed a female patron by

grabbing her hips and licking her face. Officers arrested the patron for harassment.

(15) November 1, 2007: An intoxicated male patron assaulted a female

patron by punching her in the face. The female sustained a cut across the bridge of her nose and multiple bruises on her face, around the eyes and nose. The intoxicated male patron was angry and belligerent. He spit on a security staffer and an officer while in custody. Officers arrested him and charged him with assault and harassment.

(16) November 4, 2007: Two patrons, a boyfriend and girlfriend, began

arguing while inside the premises. The dispute continued as they were escorted from the premises. Once outside the premises, the male patron hit the female patron in the face, knocking her down. Officers arrested him for domestic assault. The female advised they were fighting because she was drunk.

(17) November 11, 2007: Two women were involved in an altercation on

the dance floor. Thereafter, the husband of one of the women physically assaulted the other woman and the other woman’s cousin. Security detained the male patron, who was very intoxicated. Officers arrived and arrested him for two counts of assault.

(18) December 2, 2007: Two women began arguing while inside the

premises. Security asked one of them to leave. A short time later, as that woman was walking about a block south of the premises, two other women who had been inside the premises saw her and attacked her by punching and kicking her. The victim sustained swelling of her face, around the temple and eye. Officers arrested the two women who instigated the physical altercation for assault.

(19) December 9, 2007: An intoxicated male patron inappropriately

touched a female patron in the hallway of the premises. The woman’s boyfriend, who was also intoxicated, intervened and assaulted the male patron by pushing him against a door and onto the bathroom floor. The two men were fighting on the floor when security intervened and separated them.

(20) December 30, 2007: Several patrons who had been at the premises

celebrating a wedding got into a physical altercation as they were leaving the premises. Licensee’s security physically restrained at least three patrons involved in the disturbance. Officers arrested one patron for disorderly conduct. The crowd leaving the premises was angry and agitated. Many appeared intoxicated.


Subsequent to this disturbance, at least two patrons complained to the police that they had been assaulted and treated unfairly by Licensee’s security staff.

(21) January 5, 2008: Two patrons got into a physical altercation inside

the licensed premises. One of the two patrons was visibly intoxicated. Officers were unable to determine which one started the fight and did not make any arrests.

(22) February 1, 2008: A large group of patrons, guests at a birthday party

hosted by Zach Randolph, got into a physical altercation inside the premises. The fighting spilled out onto the sidewalk in front of the premises. It took several officers to quell the disturbance and disperse the crowd of about 100 people leaving the premises. A few days later, two patrons contacted the police to report other crimes, a theft and an assault, that occurred as part of this disturbance.

(23) February 9, 2008: Two women were involved in a physical

altercation in the ladies room. One claimed that the other hit her with a bottle. She sustained a cut above her right eye and a chipped tooth in the scuffle. She was very intoxicated, and officers were unable to determine what instigated the attack because of the patrons’ differing stories of the incident.

(24) March 29, 2008: A male patron assaulted a female patron inside the

premises by grabbing her hair, pushing her to the ground and kicking her. The woman sustained swelling and a large red mark on her cheek. Officers arrested the male patron for assault.

(25) March 29, 2008: Two male patrons began arguing over a female

patron as they were leaving the premises. The dispute between the two men escalated into a physical fight a block down the street. Officers arrested one of the two for disorderly conduct. The other sustained large abrasions on his back and side.

(26) April 13, 2008: A female patron was assaulted by another female

patron inside the premises. The victim sustained swelling and bruising on her face and a bite on her breast. Both women were very intoxicated. The victim could not identify the suspect, and the suspect identified by witnesses could not provide any coherent information to the police.

(27) April 26, 2008: A female patron was harassed and assaulted by a

male patron when she refused to dance with him. The male patron hit the woman with a beer bottle, causing lacerations to her head. She was transported to the hospital via ambulance. Officers arrested the male patron, who was only 20 years of age, for assault.


As noted above, fights, altercations and public drunkenness are specific examples of "serious" problems set out in ORS 471.315(1)(c). More than half of the above-listed serious problems occurred inside the licensed premises. Those that occurred at the entry to, or in the immediate vicinity of, the licensed premises were nevertheless related to Licensee’s sale or service of alcohol. These incidents involved patrons who began arguing with other patrons and/or Licensee’s security staff while inside the premises and the fights or disputes escalated into physical violence once the patrons voluntarily left, or were escorted from, the premises.

Even without addressing the other incidents cited in the Amended Notice, the above-

listed 27 incidents establish a history of serious and persistent problems at the licensed premises between January 20, 2007 and April 26, 2008.9 All of these incidents involved violence or the threat of violence. See Balzer's Pub & Grill (five serious incidents within six months); Rastafarian Private Club (OLCC, Final Order, 90-V-059, April 1991) (eight serious incidents during a one year period); Headless Horseman (seven serious incidents within 13 months); Felipe’s Finest Mexican & Seafood Restaurant (OLCC, Final Order, 06-V-016, February 2007) (28 problem incidents over a two year period, including 23 serious incidents involving violence or the threat of violence constituted a history of serious and persistent problems). A violation of ORS 471.315(1)(c) has been established.

Having found that Licensee has a history of serious and persistent problems, the next issue is whether Licensee has demonstrated a willingness and ability to adequately control the premises. A willingness and ability to control the licensed premises and patrons’ behavior in the immediate vicinity of the premises is a mitigating factor in assessing a history of serious and persistent problems. Licensee has the burden of establishing a willingness and ability to control the premises. ORS 183.450(2); Cisco & Pancho’s (OLCC, Final Order, 99-080ES, September 2000).

Even prior to the incidents discussed above, Licensee had a record of disturbances and

disorder at the premises. That record prompted the August 2006 meeting between OLCC staff, Portland police officers and Licensee’s principal and manager. During the meeting, Licensee was warned about having a history of serious and persistent problems at the premises. As a result, Licensee submitted a control plan designed to reduce problems at the premises. Those measures were not, however, effective, because serious problems persisted. Further, during the next 20 months, Licensee’s staff did not consistently adhere to the control plan measures,

9 The other, less serious problems which also constitute part of the history of serious and persistent problems include: (1) February 21, 2007: excessive noise citation; (2) May 24, 2007: patron urinated in the hallway of the licensed premises; (3) September 3, 2007: a visibly intoxicated patron punched a nearby tree after being ejected from the premises; (4) December 1, 2007: Licensee’s security staff failed to check identification of patrons before allowing them into the premises; (5) January 12, 2008: officers removed a very intoxicated patron who had locked herself in the restroom and took her to detox; and (6) January 12, 2008: a security staffer again allowed a patron entry without requiring that he show identification or a wristband. One other incident cited in the notice should not count against Licensee, however. On September 23, 2007, a female patron became ill and passed out while drinking at the licensed premises. She later claimed, based on her symptoms and information provided by hospital staff, that someone at the bar slipped Ketamine in her drink. While an unfortunate incident, it should not count against Licensee as a serious problem because of the lack of evidence linking Licensee to the alleged unlawful activity.


including monitoring patrons for visible intoxication, checking identification of all patrons, using equipment to detect fake IDs and employing patience, diplomacy and non-threatening conduct with problematic customers. More than once during the time period in issue, staff did not check patrons’ identification prior to entry. On at least two occasions, underage persons were permitted entry into the licensed premises. In addition, on more than one occasion, patrons complained of being assaulted or injured by Licensee’s security staff.

In a December 2007 meeting, OLCC warned Licensee that it had a history of serious and

persistent problems and recommended that Licensee implement additional measures to better control the premises and patron behavior in the immediate vicinity. OLCC made suggestions designed to curtail the string of assaults that had occurred inside, or just outside, the premises. Licensee’s manager promised to try the suggestions and submit an updated control plan. Licensee did not, however, submit the updated plan in a timely manner. Furthermore, between December 12, 2007 and April 26, 2008, there were eight more serious problems at the premises: six assaults or physical altercations inside the premises and two outside, involving patrons leaving the premises.

Since the April 26, 2008 incident, however, there have been significantly fewer problems

at the licensed premises. In fact, in this record, there is evidence of only one more serious incident subsequent to that time, which was not charged as part of the history of serious and persistent problems. Evidence about this incident was admitted solely as it reflects upon Licensee’s willingness and ability to control the premises.10 On November 27, 2008, a patron was involved in a dispute with another patron and was ejected from the premises. Angry about being ejected, the patron retrieved a gun from his vehicle, returned to the premises entry and threatened security with the gun. While the incident was serious, Licensee’s security staff took appropriate steps to deal with this patron. The patron was ejected from the premises after causing a problem, and when he returned with the gun, security acted appropriately by notifying the police.11

This gap of seven months between serious problems and the overall decrease in the need

for police service at the licensed premises since April 2008 (10 months before the hearing in this matter) is likely attributable to a combination of factors, not all of which were of Licensee’s volition. Between late April 2008 and August 2008, Licensee made changes in operation and refocused its security and bar staff to recognize and address intoxicated patrons and inappropriate behavior. In addition, since mid-May 2008, Licensee has been prohibited from

10 The other “problem” in November 2008 was not directly related to Licensee’s sale or service of alcohol under the license. In that incident, corporate principal Papas became frustrated and angry with the fire inspector when the inspector came with a police officer to inspect the building’s basement for fire code violations. 11 While incidents resulting from licensee’s appropriate steps to deal with problem persons (by refusing them service and/or by removing them from the premises) may count as serious incidents, these same security efforts are to be considered in evaluating willingness and ability to control the problems associated with the licensed premises. The Hydrant (OLCC, Amended Final Order, 00-L-006, October 2001). Based on the ultimate conclusion that Licensee had the willingness and ability to control the premises after April 2008, additional analysis of the mixed record concerning appropriateness of the steps taken by security prior to that date is unnecessary.


using the third floor banquet hall and dance floor. The closure of the third floor was involuntary, but the resulting reduction in Licensee’s patron capacity, along with other measures Licensee employed, has enabled Licensee to better control the premises and patrons’ behavior in the immediate vicinity of the premises. Consequently, since April 26, 2008, with its operational changes and patron capacity reduced by the closure of the third floor, Licensee has demonstrated a willingness and ability to control the premises.

3. Penalty for Violation of ORS 471.315(1)(c)

Generally, the Commission treats a violation of ORS 471.315(1)(c) as a Category I violation. See Rastafarian Private Club (OLCC, Final Order, OLCC-90-V-059, April 1991). The standard penalty for a first Category I violation is cancellation of the license. OAR 845-006-0200. The Commission also has the discretion to take into account the particular circumstances of each case, and increase or decrease the sanction where there are aggravating or mitigating circumstances. OAR 845-006-0200(7)(c).

Licensee contends that the penalty should be mitigated because, since late April 2008, it

has had few problems and has adequately controlled the premises. Commission staff, on the other hand, asserts that Licensee’s efforts to control the premises came “too little too late,” and that cancellation is the appropriate sanction. Commission staff argues that although Licensee was warned about the history of serious and persistent problems violation in December 2007 and advised to update its control plan, Licensee did not submit a new control plan and the serious problems continued for four more months. Commission staff cites to Helena’s Place (OLCC, Final Order, OLCC-04-V-024, June 2005) and Jiffy Mart (OLCC, Final Order, 04-V-027, February 2005), two cases in which the licensee was not entitled to mitigation of the standard sanction.

In Helena’s Place, the licensee had a history of serious and persistent problems based

upon nine serious problems and one less serious problem over the course of six and one-half months. The Commission held that mitigation of the penalty was unwarranted because the problems continued after the licensee had a compliance plan in place, and the licensee had not consistently adhered to the compliance plan’s requirements, including conditions specifically imposed in lieu of an emergency suspension pending the cancellation hearing. In Jiffy Mart, although the licensee had remodeled and cleaned up the premises, it failed, despite OLCC’s request, to develop a compliance plan to prevent future problems. It took Licensee six months after the last violation to institute changes. The Commission held that “the time it took for changes to occur negates any mitigation Licensee may be due for making efforts to prevent violations.” Final Order at 8.

Here, as discussed above, after the April 26, 2008 assault on one patron by another inside

the premises, Licensee made operational changes and lost the use of the third floor night club. Because of the operational changes and the forced reduction in patron capacity, Licensee had only had one more serious problem for the remainder of the year. And, in that November 2008 incident, Licensee’s security took appropriate steps to address the situation. Licensee provided the Commission with an updated control plan in August 2008, and there is no evidence to suggest that Licensee’s staff has not adhered to those policies and procedures since that time.


Because Licensee made significant changes in operation since late April 2008 and is now

operating on only two of its three floors, mitigation is warranted. Between April 2008 and the February 2009 hearing, Licensee had only one incident involving violence or threat of violence in 10 months. Consequently, the Commission finds that instead of cancellation, an appropriate sanction is a 30-day suspension or a civil penalty of $4,950. See, e.g., New Copper Penny Restaurant (mitigation was appropriate because, subsequent to having history of serious and persistent problems, the licensee made significant changes in operation and demonstrated the willingness and ability to control the premises); Balzer’s Pub & Grill (licensees continuing and remedial steps after the violation justified mitigation); 300 Club/A Change of Seasons (OLCC, Final Order, OLCC-99-V-060, April 2001) (after 20 incidents over a one year period, 14 of which involved violence or threat of violence, licensee demonstrated a willingness and ability to adequately control the premises; the extensive nature and degree of licensee’s efforts to prevent violations justified substantial mitigation of the penalty); and Schooners (mitigation justified by licensees’ implementation of new policies, operational changes and submission to a compliance plan with the local police agency).

Upon consideration of prior Commission cases where a history of serious and persistent

problems has been found to exist and the standard penalty of cancellation mitigated, the Commission observes that the pattern of mitigating so much as to give the option of paying a civil penalty in lieu of any suspension period is insufficient to deter violations of this magnitude or to encourage rapid resolution of the underlying problems. The number and nature of incidents giving rise to a history of serious and persistent problems impact the surrounding community and disproportionately strain law enforcement resources. In the future, the Commission intends to impose some appropriate period of mandatory suspension (not less than one day and not to exceed 30 days), with or without the option of paying a civil penalty in lieu of a portion of the suspension period, as a penalty in cases of this type.

In addition to the fine or suspension imposed herein, the Commission concludes that

restrictions may prevent the recurrence of the problems that caused the violation of ORS 471.315(1)(c).12The Commission notes that many of the serious problems involving violence or the threat of violence at, or in the immediate vicinity of, the licensed premises occurred after 12:00 a.m. and involved intoxicated patrons. Further, Licensee’s patron capacity was reduced significantly when it was forced to stop using the third floor, which reduction was a contributing cause to Licensee’s ability to control the premises and patrons’ behavior in the immediate vicinity subsequent to that change. That change is not permanent. Should Licensee regain use of its third floor for the sale or service of alcohol, its ability to control the premises and its level of risk for future compliance would be significantly compromised. To ensure future compliance

12 OAR 845-005-0355, in pertinent part, provides:

(1) The Commission may restrict a license or service permit when: (a) In the absence of a restriction, the commission has a basis to cancel, suspend/fine or

deny the license or service permit; (b) In addition to all or part of a suspension or fine, a restriction may prevent the

recurrence of the problem(s) that caused the violation(s); or (c) . . .


and to prevent the recurrence of the problems that caused the violation, the Commission imposes the following restrictions on this license, to be applied to the entire premises:13

1. Licensee shall prohibit the sale, service, or consumption of alcoholic beverages between 12:00 AM and 2:30 AM. 2. Licensee shall limit the amount of alcohol in a container to no more than 16 ounces of malt beverage, 6 ounces of wine, or 1.5 ounces of distilled spirits. 3. Licensee shall limit each patron to possessing no more than one container of alcohol at a time. 4.Licensee shall have at least five DPSST-certified staff on duty on the premises between 8:00 PM and closing on Thursday, Friday and Saturday nights, and any other day when a special event is being held, to monitor patrons inside the premises and in the immediate vicinity adjacent to the premises. 5. Licensee shall have at least one alcohol monitor on duty on the licensed premises between 8:00 PM and closing on Thursday, Friday, and Saturday nights to monitor the patrons’ behavior and alcohol consumption to ensure that alcoholic beverages are not made available to visibly intoxicated patrons, that visibly intoxicated patrons are not allowed to consume alcoholic beverages, and that visibly intoxicated persons are not allowed to enter the premises. The alcohol monitor shall not be an on-duty bartender, server or one of the five on-duty DPSST-certified security staff.

In the alternative, if Licensee is unable or chooses not to use its third floor for alcohol sales, service, or consumption, the following restrictions to the license apply, to be applied to the entire premises:14

13 The size of this premises is within Licensee’s control, thus the Commission is tailoring the restrictions accordingly, in order to meet the circumstances that gave rise to the history of serious and persistent problems and to prevent their recurrence. These restrictions apply whether or not Licensee is presently using, or plans to use, the third floor for the sale, service, or consumption of alcoholic beverages unless Licensee makes the written election referred to in footnote 13, infra. This list of restrictions derives from those imposed by the Administrative Law Judge, in the context of license renewal, at page 28 of the Proposed Order in this matter. These restrictions differ somewhat in an effort to be consistent with other licenses that have been restricted due to a poor record of compliance and/or history of serious and persistent problems when previously licensed, and to account for the third floor contingency. In Restriction #4, the Commission believes that more than two DPSST-certified staff are required to control the premises and patrons’ behavior in the immediate vicinity of the premises. In her Response to Agency Comments and Licensee’s Exceptions to the Proposed Order, the Administrative Law Judge stated that she had no objection to the restrictions as worded in Staff’s Comments on the Proposed Order. 14 In order to elect this second alternate set of restrictions, the Commission will order that Licensee notify the Commission in writing that the third floor will no longer be used for the sale, service, or consumption of alcohol. See p. 33, infra.


1. Licensee shall not use the third floor for the sale, service, or consumption of alcoholic beverages. 2. Licensee shall limit the amount of alcohol in a container to no more than 16 ounces of malt beverage, 6 ounces of wine, or 1.5 ounces of distilled spirits. 3. Licensee shall limit each patron to possessing no more than one container of alcohol at a time. 4. Licensee shall have at least five DPSST-certified staff on duty on the premises between 10:00 PM and closing on Friday and Saturday nights, and any other day when a special event is being held, to monitor patrons inside the premises and in the immediate vicinity adjacent to the premises. 5. Licensee shall have at least one alcohol monitor on duty on the licensed premises between 8:00 PM and closing on Thursday, Friday, and Saturday nights to monitor the patrons’ behavior and alcohol consumption to ensure that alcoholic beverages are not made available to visibly intoxicated patrons, that visibly intoxicated patrons are not allowed to consume alcoholic beverages, and that visibly intoxicated persons are not allowed to enter the premises. The alcohol monitor shall not be an on-duty bartender, server or one of the five on-duty DPSST-certified security staff.

Should Licensee fail to comply with an applicable restriction on the license, then the license would be subject to cancellation under the provisions of OAR 845-005-0355(5) and OAR 845-006-0500(7).

4. License Renewal

OLCC also proposes to deny renewal of Licensee’s liquor license on two alternate bases, ORS 471.313(4)(g) and ORS 471.313(5).15 Pursuant to ORS 471.313(4)(g), the Commission “may refuse to license any applicant * * * if the Commission has reasonable ground to believe any of the following to be true”:

(4) That the applicant: * * * (g) Did not have a good record of compliance with the alcoholic liquor laws of the

15 In the licensing context (as contrasted with the violation context of ORS 471.315(1)(c)), a finding that Licensee has the willingness and ability to control the premises and patrons’ behavior in the immediate vicinity of the premises, overcomes the license refusal basis for a history of serious and persistent problems. ORS 471.313(5). Because such a finding has been made in this matter, the alternate alleged renewal refusal basis under ORS 471.313(5) need not be addressed.


state and the rules of the Commission when previously licensed. The Commission may count as evidence of a poor record of compliance charges that are proved for the first time during the license refusal contested case, as long as the Commission gives reasonable notice of the charges and provides the applicant an opportunity to contest the charges. Riverside Restaurant & Lounge (OLCC, Final Order, 94-L-008, December 1996). The OLCC has proved the violation charged in this case but, as set out above, the Commission finds that cancellation of the license is not warranted. Nevertheless, citing to Licensee’s history of serious and persistent problem violation and three prior violations (2006-2007, advertising in violation of OAR 845-007-0020(2); 2006, changing principal use of a room in violation of OAR 845-006-0480(2); and 2004, server without valid permit in violation of ORS 471-360(1)(b)), the OLCC asserts that Licensee has a poor record of compliance while licensed. Despite Licensee’s record of one Category I violation with a mitigated sanction and two Category V violations (advertising restrictions and changes in premises without prior notice) in the prior two years, one Category III violation (mixing, selling or serving without a service permit) in 2004 and repeated verbal warnings within the last five years, the Commission finds, for the reasons set out below, that Licensee’s license renewal should be granted with restrictions on the license.

A poor record of compliance may be overcome as a ground for refusal where the evidence shows that despite the violation record, the applicant would not be a poor risk for future compliance with the alcoholic beverage laws. See, e.g., Crane Supply Tavern (OLCC, Final Order, 85-L-019, August 1985) (evidence established that future violations were unlikely and the area had a need for the license); Hale’s Tavern (OLCC, Final Order, 85-L-010, June 1985) (good cause shown where applicant had only one violation in nine years as a licensee, the violation was committed by applicant’s employee rather than the applicant personally and the applicant took swift action to prevent recurrence of violation). Factors to be considered in determining the existence of good cause include the period of time without violations as a licensee, the nature and seriousness of the violations, whether the violations were mitigated or aggravated, and acceptance of responsibility for the violation. See, e.g., Quincy Store (OLCC Final Order, 02-V-008/L-001, December 2002.) The burden is on the licensee to demonstrate that it is a good candidate for future compliance with the liquor laws. See Dad’s Restaurant & Lounge (OLCC Final Order, 06-V-029, December 2007).

In Cabana Club (OLCC, Final Order, OLCC-03-L-010, April 2005), the licensee had two history of serious and persistent violations over the course of five years. On the first violation, the licensee entered into a settlement agreement and agreed to operate under a compliance plan with restrictions on the license. On the second violation, three years later, the licensee demonstrated a willingness and ability to control the premises after a string of five serious incidents over a one year period. Despite Licensee’s poor compliance history, the Commission found that it did not have grounds to refuse to renew the license under ORS 471.313(4)(g) because, in the interim, the licensee had demonstrated a willingness and ability to control the premises and patrons’ behavior in the immediate vicinity of the premises. The Commission


renewed the license with the restrictions in place. See also Civic Food Mart (OLCC, Final Order, OLCC-99-L0-14, December 2000) (the Commission found good cause to overcome a denial where the licensee had a comprehensive control plan and agreed to restrictions designed to control the premises and patrons behavior near the licensed premises).

As discussed above, Licensee’s circumstances have changed since April 2008. Licensee has also adopted and adhered to new policies and procedures that have significantly reduced the number of serious problems, and has demonstrated a willingness and ability to control the premises and patrons’ behavior in the immediate vicinity. For this reason, as in Cabana Club, the Commission finds that the Commission does not have grounds to refuse to renew the license under ORS 471.313(4)(g). The Commission further finds that, given its current circumstances, Licensee is not a poor risk for future compliance. However, Licensee’s circumstances are not static, and should Licensee regain use of its third floor for the sale or service of alcoholic beverages, its ability to control the premises and its level of risk for future compliance would be significantly compromised. To ensure that Licensee is not a poor risk for future compliance, the Commission determines that the license be renewed with the following restrictions, to be applied to the entire premises:16

1. Licensee shall prohibit the sale, service, or consumption of alcoholic beverages between 12:00 AM and 2:30 AM. 2. Licensee shall limit the amount of alcohol in a container to no more than 16 ounces of malt beverage, 6 ounces of wine, or 1.5 ounces of distilled spirits. 3. Licensee shall limit each patron to possessing no more than one container of alcohol at a time. 4.Licensee shall have at least five DPSST-certified staff on duty on the premises between 8:00 PM and closing on Thursday, Friday and Saturday nights, and any other day when a special event is being held, to monitor patrons inside the premises and in the immediate vicinity adjacent to the premises.

16 The size of this premises is within Licensee’s control, thus the Commission is tailoring the restrictions accordingly, in order to meet the circumstances that gave rise to the history of serious and persistent problems and to prevent their recurrence. These restrictions apply whether or not Licensee is presently using, or plans to use, the third floor for the sale, service, or consumption of alcoholic beverages unless Licensee makes the written election referred to in footnote 16, infra. This list of restrictions derives from those imposed by the Administrative Law Judge, at page 28 of the Proposed Order in this matter. These restrictions differ somewhat in an effort to be consistent with other licenses that have been restricted due to a poor record of compliance and/or history of serious and persistent problems when previously licensed and to account for the third floor contingency. In Restriction #4, the Commission believes that more than two DPSST-certified staff are required to control the premises and patrons’ behavior in the immediate vicinity of the premises. In her Response to Agency Comments and Licensee’s Exceptions to the Proposed Order, the Administrative Law Judge stated that she had no objection to the restrictions as worded above (from Staff’s Comments on the Proposed Order).


5. Licensee shall have at least one alcohol monitor on duty on the licensed premises between 8:00 PM and closing on Thursday, Friday, and Saturday nights to monitor the patrons’ behavior and alcohol consumption to ensure that alcoholic beverages are not made available to visibly intoxicated patrons, that visibly intoxicated patrons are not allowed to consume alcoholic beverages, and that visibly intoxicated persons are not allowed to enter the premises. The alcohol monitor shall not be an on-duty bartender, server or one of the five on-duty DPSST-certified security staff.

In the alternative, if Licensee is unable or chooses not to use its third floor for alcohol sales, service, or consumption, the following restrictions to the license apply, to be applied to the entire premises:17

1. Licensee shall not use the third floor for the sale, service, or consumption of alcoholic beverages. 2. Licensee shall limit the amount of alcohol in a container to no more than 16 ounces of malt beverage, 6 ounces of wine, or 1.5 ounces of distilled spirits. 3. Licensee shall limit each patron to possessing no more than one container of alcohol at a time. 4.Licensee shall have at least five DPSST-certified staff on duty on the premises between 10:00 PM and closing on Friday and Saturday nights, and any other day when a special event is being held, to monitor patrons inside the premises and in the immediate vicinity adjacent to the premises. 5. Licensee shall have at least one alcohol monitor on duty on the licensed premises between 8:00 PM and closing on Thursday, Friday, and Saturday nights to monitor the patrons’ behavior and alcohol consumption to ensure that alcoholic beverages are not made available to visibly intoxicated patrons, that visibly intoxicated patrons are not allowed to consume alcoholic beverages, and that visibly intoxicated persons are not allowed to enter the premises. The alcohol monitor shall not be an on-duty bartender, server or one of the five on-duty DPSST-certified security staff.

Should Licensee fail to comply with an applicable restriction on the license, then the license would be subject to cancellation under the provisions of OAR 845-005-0355(5) and OAR 845-006-0500(7).

/ / / / /

/ / / / /

/ / / / /

17 In order to elect this second alternate set of restrictions, the Commission will order that Licensee notify the Commission in writing that the third floor will no longer be used for the sale, service, or consumption of alcohol. See p. 34, infra.


FINAL ORDER

The Commission orders that Downtown Delicatessen, Inc., Ted Papas, President and John Papatheodorou, Secretary, dba DOWNTOWN DELI & GREEK CUSINA, located at 404 SW Washington Street, Portland, Oregon be SUSPENDED for 30 days or FINED $4,950 in lieu of suspension for violating ORS 471.315(1)(c). If you choose to pay the fine, it must be paid within ten (10) days of the date of this Order; otherwise, the suspension must be served. In addition to the fine or suspension for this violation, the Commission orders that the following restrictions to the license, applicable to the entire premises, be imposed:


In the alternative, if Licensee is unable or chooses not to use its third floor for alcohol sales, service, or consumption, the following restrictions to the license apply, to be applied to the entire premises:

1. Licensee shall not use the third floor for the sale, service, or consumption of alcoholic beverages. 2. Licensee shall limit the amount of alcohol in a container to no more than 16 ounces of malt beverage, 6 ounces of wine, or 1.5 ounces of distilled spirits. 3. Licensee shall limit each patron to possessing no more than one container of alcohol at a time.


4. Licensee shall have at least five DPSST-certified staff on duty on the premises between 10:00 PM and closing on Friday and Saturday nights, and any other day when a special event is being held, to monitor patrons inside the premises and in the immediate vicinity adjacent to the premises. 5. Licensee shall have at least one alcohol monitor on duty on the licensed premises between 8:00 PM and closing on Thursday, Friday, and Saturday nights to monitor the patrons’ behavior and alcohol consumption to ensure that alcoholic beverages are not made available to visibly intoxicated patrons, that visibly intoxicated patrons are not allowed to consume alcoholic beverages, and that visibly intoxicated persons are not allowed to enter the premises. The alcohol monitor shall not be an on-duty bartender, server or one of the five on-duty DPSST-certified security staff.

In order to elect and utilize this second alternate set of restrictions, Licensee must notify the Commission in writing that the third floor will no longer be used for the sale, service, or consumption of alcohol. The Commission orders that the application for renewal of the Full On-Premises Sales license filed by Downtown Delicatessen, Inc., Ted Papas, President and John Papatheodorou, Secretary, dba DOWNTOWN DELI & GREEK CUSINA, located at 404 SW Washington Street, Portland, Oregon, be GRANTED WITH THE FOLLOWING RESTRICTIONS, applicable to the entire premises:



In the alternative, if Licensee is unable or chooses not to use its third floor for alcohol sales, service, or consumption, the following restrictions to the license apply, to be applied to the entire premises:

1. Licensee shall not use the third floor for the sale, service, or consumption of alcoholic beverages. 2. Licensee shall limit the amount of alcohol in a container to no more than 16 ounces of malt beverage, 6 ounces of wine, or 1.5 ounces of distilled spirits. 3. Licensee shall limit each patron to possessing no more than one container of alcohol at a time. 4. Licensee shall have at least five DPSST-certified staff on duty on the premises between 10:00 PM and closing on Friday and Saturday nights, and any other day when a special event is being held, to monitor patrons inside the premises and in the immediate vicinity adjacent to the premises. 5. Licensee shall have at least one alcohol monitor on duty on the licensed premises between 8:00 PM and closing on Thursday, Friday, and Saturday nights to monitor the patrons’ behavior and alcohol consumption to ensure that alcoholic beverages are not made available to visibly intoxicated patrons, that visibly intoxicated patrons are not allowed to consume alcoholic beverages, and that visibly intoxicated persons are not allowed to enter the premises. The alcohol monitor shall not be an on-duty bartender, server or one of the five on-duty DPSST-certified security staff.

In order to elect and utilize this second alternate set of restrictions, Licensee must notify the Commission in writing that the third floor will no longer be used for the sale, service, or consumption of alcohol.

It is further ordered that notice of this action, including the reasons for it, be given.

Dated this 27th day of October, 2009. /s/ Rudy Williams for:

Stephen A. Pharo Executive Director OREGON LIQUOR CONTROL COMMISSION

Mailed this 27th day of October, 2009.


THIS ORDER IS EFFECTIVE ON THE DATE MAILED. Any monetary fine or civil penalty set out in the order shall be due and payable 10 days after the date of mailing.

NOTICE: You are entitled to judicial review of this Order. Judicial review may be obtained by filing a petition for judicial review within 60 days from the service of this Order. Judicial review is pursuant to the provisions of ORS Chapter 183.

/ / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /


LIST OF EXHIBITS CITED

Exhibit Description

A1 Portland Police Bureau Report, Case no. 07-6097, 1/20/2007 A2 Portland Police Bureau Report, Case no. 77-690, 1/25/2007 A3 Portland Police Bureau Report, Case no. 07-12708, 2/11/2007 A4 Portland Police Bureau Report, Case no. 0712882, 2/11/2007 A5 OLCC Intake/Compliance Action Report, 2/15/2007 A6 City of Portland, Bureau of Development Services Noise Citation, 2/23/2007 A7 Portland Police Bureau Report, Case no. 07188507, 3/10/2007 A8 Portland Police Bureau Report, Case no. 07-017007, 3/312007 A9 OLCC Intake/Compliance Action Report, 3/16/2007 A10 Portland Police Bureau Report, Case no. 07-38333, 5/24/2007 A11 Portland Police Bureau Report, Case no. 07-0807, 7/8/2007 A12 Portland Police Bureau Report, Case no. 07-58570, 7/13/2007 A13 Portland Police Bureau Report, Case nos. 07-58952, 7/14/2007 A14 Portland Police Bureau Report, Case no. 07-04726, 7/28/2007 A15 Portland Police Bureau Report, Case no. 07-65109, 7/29/2007 A16 OLCC Intake/Compliance Action Report, 7/20/2007 A17 Portland Police Bureau Report, Case No. 07-079248, 9/3/2007 A18 Portland Police Bureau Report, Case No. 07-082056, 9/9/2007 A19 Portland Police Bureau Report, Case no. 07-086907, 9/22/2007 A20 Portland Police Bureau Report, Case no. 07-87153, 9/23/2007 A21 Email to OLCC from Hollie Arnell-Nothwang, 9/23/2007


A22 Portland Police Bureau Report, Case no. 07-89595, 9/29/2007 A23 OLCC Intake/Compliance Action Report, 9/29/2007 A24 Portland Police Bureau Report, Case no. 07-94546, 10/14/2007 A25 Portland Police Bureau Report, Case no. 07-100928, 11/1/2007 A26 Portland Police Bureau Report, Case no. 07-102096, 11/4/2007 A27 Portland Police Bureau Report, Case no. 07-104629, 11/11/2007 A28 Portland Police Bureau Report, Case no. 07-111442, 12/1/2007 A29 Portland Police Bureau Report, Case no. 07-111821, 12/2/2007 A30 OLCC Enforcement and Compliance Services Investigation Report, 12/14/2007 A31 Portland Police Bureau Report, Case no. 07-113837, 12/8/2007 A32 Email to OLCC from Karen M. Evans, DPSST, 12/19/2007 A33 Portland Police Bureau Report, Case no. 07-114156, 12/9/2007 A34 Portland Police Bureau Report, Case no. 07-114592, 12/8/2007 A36 Portland Police Bureau Report, Case no. 07-120927, 12/30/2007 A37 Portland Police Bureau Report, Case no. 08-001415, 1/5/2008 A38 Portland Police Bureau Report, Case no. 08-003811, 1/12/2008 A39 Portland Police Bureau Report, Case no. 08-3851, 1/12/2008 A40 OLCC Enforcement and Compliance Services Supplemental Report, 1/22/2008 A41 Portland Police Bureau Report, Case no. 08-5338, 1/12/2008 A43 Portland Police Bureau Report, Case no. 08-010330, 2/1/2008 A44 OLCC Enforcement and Compliance Services Supplemental Report, 2/6/2008 A47 Portland Police Bureau Report, Case no. 08-012899, 2/9/2008 A49 Portland Police Bureau Report, Case no. 08-029806, 3/29/2008


A50 Portland Police Bureau Report, Case no. 08-029818, 3/29/2008 A52 Portland Police Bureau Report, Case no. 08-034911, 4/13/2008 A53 OLCC Enforcement and Compliance Services Supplemental Report, 4/17/2008 A54 Portland Police Bureau Report, Case no. 08-039295, 4/26/2008 A56 OLCC Intake/Compliance Action Report, 8/31/2006 A57 Licensee’s OLCC History Card A58 Licensee’s OLCC License Renewal Application, 4/21/2008 A59 Conditional Letter of Authority to Operate, 5/19/2008 A60 City of Portland, Unfavorable Recommendation Request Restrictions if Renewed

letter, 5/23/2008 A62 OLCC Violation Notice, 10/24/2006 A63 Notice of Proposed License Suspension/Civil Penalty, 5/10/2007 A64 Portland Police Bureau Report, Case no. 08-045967, 11/3/2008 A65 Portland Police Bureau Report, Case no. 08-118308, 11/27/2008

Licensee’s Exhibits:

103 Letter from Papas to City of Portland Office of Neighborhood Involvement

(ONI), 5/12/2008 121 Portland Tribune article, 7/31/2008 123 Licensee’s notes from meeting with OLCC, undated 140 Email from Newman to OLCC, 8/28/2007 141 Email from Inspector Paul to Newman, 8/28/2007 144 Email from Newman to OLCC, 9/24/2007 150 Email from Portland Police to OLCC, 2/1/2008 161 Administrative Search Warrant for Commercial Premises, 5/14/2008


162 Letter from ONI to Licensee, 5/1/2008 165 Email from Licensee’s manager to OLCC, 8/26/2008

Documents

BEFORE THE LIQUOR CONTROL COMMISSION OF THE STATE …...the Downtown Deli & Greek Cusina, from January 2007 through April 26, 2008? 2. Whether Licensee has demonstrated a willingness