Stage on Bay owners could sue Savannah for $6M after liquor license denial

SAVANNAH, GA (WTOC) - Owners of The Stage on Bay want $6 million from the City of Savannah if aldermen do not change their minds about issuing the business an alcohol license.

Attorneys for the Stage on Bay just issued what's called a Litem Notice to the city. Basically warning the city of a lawsuit about to be filed. That notice is required 30 days before someone sues a municipality like the City of Savannah for alleged violations of municipal and state statutes.

"Nobody wakes up in the morning and wants to be a plaintiff. My client does not want to sue the city for millions of dollars. They may force him into that position, and if they do, we will absolutely move forward with the litigation that's contemplated by this letter," said Attorney Will Claiborne.

In this case, the right to operate a business.

Last week, despite operators of the Stage on Bay jumping through all the necessary hoops to get that liquor license, the Savannah City Council denied it by a vote of 8 to 1. What's interesting about this case is that even the aldermen who voted to deny The Stage on Bay's liquor license admitted they were legally in the wrong in doing so, yet played follow the leader behind Alderman Van Johnson, whose district this concert venue is in.

Last week, Alderman Van Johnson made a passionate speech to the council. Even pointing out what he felt were legal reasons for denying the Stage on Bay liquor license.

In it, he emphasized that at some point, regardless of the law, Savannah must stand up for the people when council feels a business is not suited to a specific location. Alderman Johnson expressed concern Wednesday when WTOC David Klugh made the comment during our 5 p.m. news, that other council members followed his lead in voting against the Stage On Bay liquor license.

To Alderman Johnson, those comments were not about others following your decision but agreeing with and following your reasoning in denying that liquor license.

Once again, this is a notice to the city council that The Stage on Bay intends to sue to get that liquor license. But it also gives the city 30 days to reconsider. The options being given to the city by The Stage on Bay are to either issue the liquor license before March 2 and pay $147,000 in damages or deny the license and be sued for more than $6 million.

"We believe there's still an opportunity to save this business if the city turns around and does the right thing promptly. And if that happens before March the second, then my client is reasonable confident that he can keep the business going. But, even though he's kept the business going at that point, he will have suffered a significant amount of financial harm," said Claiborne. "These numbers add up very quickly, and I really don't think that the city council had any idea of the amount of financial harm they were doing to my client, and the amount of financial exposure they were giving to the city's taxpayers. This was a monumentally bad decision, and hopefully, this letter will emphasize to them exactly how monumental this error was."

Opposition from neighborhood leaders near The Stage on Bay factored in heavily to council's decision to deny the alcohol beverage license.

Local law professor Marc Roark points out a similar case went before the Georgia Supreme Court back in the 1980's, and in that case, the court ruled the municipality couldn't rely on that community feedback to deny the license.

"They actually have to go toward the objective factors. So as long as the applicant has satisfied the other objective factors, the city doesn't really have a right to reject that alcohol license as just a matter of right under the ordinance," said Savannah Law School professor, Marc Roark.

With a possible lawsuit on the horizon, city leaders can't say much.

"Our decision is final unless something happens to change it. That's not a very good answer, but that's a fact. I can't say anything else, it's up to our attorney to tell us where we are," said Savannah Mayor Eddie DeLoach.

Alderman Johnson has been given a cease and desist order by The Stage on Bay.

In the notice, Claiborne says Johnson repeatedly made false claims against the company including comments on Facebook.

In addition to the cease and desist order, Claiborne has also filed an open records act for Johnson to hand over copies of all e-mails, Facebook messages and posts and phone records from the beginning of 2015 until now.

Alderman Johnson released a statement on Friday:

I read somewhere that I am granted the constitutional right as an American to speak freely. I have not received anything from a judge barring my ability to do so on this matter or any other matter, so I will continue to speak the truth and I will vigorously defend my right to do so. In a defamation action, the truth is an absolute defense. I do not believe that anything said by me was not true or not in the public record. I will not be bullied or intimidated by the Plaintiff or his counsel.

Meanwhile, many of the scheduled concerts are being moved to other venues.

The Lucas Theatre hosted the Marshall Tucker Band on what was scheduled to be opening night last Friday.

Steve Augeri, former Journey frontman, will now be performing at Music City Savannah this weekend. Marc and Ted Broussard will also be performing at the same venue the following weekend. After that, all of the remaining scheduled shows will take place at The Music Vault in Hardeeville, SC.

Copyright 2017 WTOC. All rights reserved.