Mattheis brothers lose everything: tavern and liquor license
JACKSON HOLE, WYO – The Jackson town council voted this afternoon to begin revocation proceedings for the retail liquor license held by the Mattheis Company for use at the Town Square Tavern.
At issue was whether the Mattheis Company held a valid liquor license since they no longer had a physical place to apply it to. State statute requires liquor license holders to have a valid lease attached to a liquor license. The Mattheis brothers have been embroiled in a lease negotiation since their landlord informed them their rent would be increasing significantly.
The Mattheis brothers made attempts to move the license to another location but couldn’t secure one. They then asked to park the license with the town (which is allowable for up to two years under local ordinance) while they figured things out. Finally, the Mattheis family proposed a license transfer to Get Loose LLC (Gavin Fine’s Fine Dining company) who is the new tenant at the Tavern beginning November 1).
While the Mattheises tried to find a landing place for their liquor license, they continued to operate all summer by producing a lease signed by Steve Mattheis that was later deemed falsified. Mattheis admitted to signing it but under duress of the situation and at the bad advice of a lawyer he would not name.
A license transfer would at least allow the Mattheis brothers to go out of business with some recoup of their investments. State statute allows for retail liquor licenses to be sold on the open market for any amount of money. These private sales are sometimes reported to be for hundreds of thousands of dollars. A source close to the town said the Mattheis brothers bought the license more than a decade ago for reportedly in excess of a quarter of a million dollars.
A transfer of the liquor license would also mean Fine would be guaranteed the lucrative retail license without having to risk the uncertainty of who the town may eventually decide to award it to should it come back to the town. Fine was apparently ready to pay six figures for that guarantee. Without it, he will have to apply for the license from the town, which would be issued for a $1,500 permit fee. Retail liquor licenses are the least restrictive and most flexible of all liquor licenses. A limited number is available to municipalities and counties according to population.
The decision will likely launch litigation against the town from the Mattheis family—something their lawyer more than hinted at while pleading for mercy on behalf of his clients. For now, the license is headed for district court to be declared invalid and eventually returned to the town for reissue.
Mark Sullivan, representing the Mattheis family, made multiple arguments while addressing the council. He reminded councilors that while the state might consider the license invalid without a lease, it had taken no action on it or made no official ruling. In fact, the State Liquor Division had continued to sell alcohol to the Tavern all summer long, presumable, according to Sullivan, waiting for the local municipality to make a decision.
Sullivan also conjectured that no one was harmed or would be harmed in the transfer of the liquor license. “There is no victim here. No harm,” Sullivan said. “In fact, harm would come through revocation. For the Mattheis family, the harm would be devastating. Revocation would also harm Get Loose. They have plans on that site and are ready to step in and run a reputable business.”
Sullivan suggested a fine perhaps, or pursuit of prosecution of a misdemeanor for falsifying information on the liquor license re-application.
“I hope you show some compassion for these folks. The Mattheises are losing their business one way or another. You have power to prevent this family from experiencing a total loss,” Sullivan added.
How they voted
The sole vote opposed to revoking the liquor license held by the Mattheis brothers Steve and Mike was cast by Don Frank. He asked his peers take a broader look at the situation.
Frank argued that a revocation of license would result in a lose-lose-lose scenario where Mattheis would be out their investment in addition to losing their livelihood. Get Loose LLC would miss out on the opportunity to put a retail liquor license immediately into affect at its new restaurant. Finally, the community and town would miss out on the benefit of a bar on the town square and the town would lose the sales tax revenue generated by it.
“He who has no sin upon their hands should throw the first stone,” Frank said, emphasizing that everyone makes mistakes. He also pointed out how the council recently let Lotus off the hook for abusing its bar and grill liquor license. “We used it as a teaching moment,” he said.
Finally, Frank said a high-minded approach of upholding the letter of the law would simply result in hurting everyone involved. “We have an obligation to seek the public good,” he said.
From the beginning councilman Jim Stanford said he could not understand how the Mattheises could have signed a document implying they had a lease when they did not. He said he did not wish to establish or pursue intent or guilt of the applicant, but simply wanted to make a decision based on whether he thought the applicant held a valid liquor license.
“The answer to that question is no. It was not true in the spring; it was not true all summer for a period of ‘thriving business,’ (as admitted to by the applicant); and it is not true now,” Stanford said. “For me it is a gross violation. Providing false information is an offense for which you can be prosecuted and face jail time.”
Mayor Pete Muldoon said he did not want to set a precedent of allowing license holders to violate their agreements without repercussion. “In fact, it says the town council will not only look the other way but will reward you with six months of additional sales, and allow you to make money on the sale of your liquor license,” he said.
Hailey Morton Levinson said it was a tough decision she did not relish having to make but could see no way around the fact that the Mattheis brothers did not technically have a liquor license to transfer since the lack of a lease invalidated the license.
Bob Lenz went a step further, calling it the worst day he has had in 11 years serving on the town council. “I appreciate the value and livelihood the liquor license represents,“ he said, which in his opinion highlighted the importance of making sure procedures were followed to the letter or else “very serious consequences” could result beyond the purview of the council.
The 5-1 vote by the council to revoke the retail liquor license held by the Mattheis Company for the Town Square Tavern will send the matter to district court for a final ruling.