Conversion of family bar to adult entertainment business not legitimate basis for denying permit renewal

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After Dan Dumoulin, Sr. (Dan Sr.) and his wife, Joan, transferred ownership of their sports bar and its alcoholic beverage permit to their son, (Dan Jr.), Dan Jr. converted the business into an adult entertainment establishment. When he later applied to renew the permit, remonstrators sought to prevent the renewal. After a hearing, the local alcoholic beverage board recommended denying the petition to renew the permit, and the Indiana ATC agreed. Dan Jr., as the owner of the permit premises, appealed the denial to the Howard Superior Court. The trial court reversed, concluding that the ATC’s decision was arbitrary and capricious and unsupported by the evidence because it was based entirely upon the nature of entertainment provided by the business, which does not, by itself, preclude the business from having an alcoholic beverage permit. The ATC now appeals, arguing that it properly denied Dan Jr.’s renewal application.

Conclusion (slip op. at 16):  The decision of the trial court is affirmed.

Key Analysis (slip op. at 15-16):  Dan Jr.’s conversion of Ultimate Place from a family sports bar to an adult entertainment business is not a legitimate basis for denying the permit renewal. Alcoholic beverage permit holders are permitted by law to allow adult-oriented dancing on the licensed premises without obtaining prior authorization from the ATC, subject to floor plan approval. Thus, the ATC’s reliance upon this basis for its decision was arbitrary and capricious.

About Bose McKinney & Evans LLP

Bose McKinney & Evans LLP is a business law firm, headquartered in Indianapolis, Indiana, serving both publicly held and privately held businesses, governmental entities and high-growth industries. Our clients include Fortune 100 companies, international manufacturers, national and regional financial institutions, agribusinesses, sports teams, university-incubated start-ups, media, utilities, cities and schools, to name a few. We strive to build strong relationships with our clients as key business advisors, to exceed expectations in the quality of our work, to be knowledgeable about our clients’ businesses and sectors, to be responsive to service needs and to continually seek to improve the delivery of client services. Our ultimate focus is on our clients.
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