Looking for any possible respite to the economic havoc wrought upon by the coronavirus pandemic, some clubs have begun to wage the war to reopen in locales where social restrictions are being loosened, gradually.
The May 5 ED Webcon led off with RCI CEO Eric Langan, who helmed the reopening of Club Onyx (owned by Rick’s Cabaret) in Houston. The opening, followed by the subsequent closure and re-opening received national press. Read the latest story on Club Onyx right here!
Also joining the Webcon were four industry attorneys — Gary Edinger, Luke Lirot, Matt Hoffer, and Jeff Scott Olson — who offered key information on what clubs that serve food need to know as they either open or prepare to reopen.
Langan recapped how Club Onyx met the criteria of food to liquor sales — physical markers, constant sanitation, social distancing, masks, etc. — to qualify as a restaurant, which was met with legal opposition.
“We have no contact dancing,” Langan said. “The girls can dance table-side, but they cannot lap dance. They cannot touch you, you cannot touch them.
“It’s working,” Langan added. “The main reason we did this is a lot of the employees at Club Onyx have not gotten their first unemployment check. They’re running out of money. This way, they can earn their own money. That’s what they want.”
Langan said the fire marshal came but relented when Club Onyx had all of its requisite documentation.
“We had about 78 customers who braved through the crowd of police to come into the business that night,” he said. “It looked like cops were protesting against us.”
Langan said Club Onyx is operating at 25% capacity, per state guidelines. He is already looking forward to when establishments can allow more customers.
“At 50% occupancy, I think we can maybe even turn a little profit,” Langan said. “You have to think about, when you decide to open, what is important to you? If you have to make money, if you’re having cash-flow problems, opening at 25% occupancy isn’t going to solve that.”
“Some of these city officials just don’t understand the legalities of what they’re doing. They’re so focused on the strippers that they’re not looking at how we’re operating.”
— Eric Langan
For now, Langan said Club Onyx has been serving food in the new normal: single-serving condiments, disposable utensils, heightened hygienic practices, and masks.
“There’s a lot of cleaning,” Langan said. “Luckily this location has leather chairs.”
“I wanted to show we can operate safely under these rules,” he continued. “We want to be part of the solution getting the economy back to normal by following the rules and creating a safe environment for people to earn money and keep their health and safety at the forefront. Making money is secondary at this point.”
Lirot explained that other club owners/operators, in places where restaurants are allowed to reopen, should be cautious if attempting to reopen under the same premise.
“Using the same business model that Eric just described, if you’re going to say you’re going to open under your restaurant license and leave peanuts on the bar and go on with business as usual, I think you can expect a problem,” Lirot said.
Edinger pointed out clubs use caution when navigating the varying layers of regulations implemented by a hierarchy of government.
“Make sure not just that you review the governor’s order, but also that you’re savvy about your county and maybe municipal orders to ensure you’re corresponding with all of them,” Edinger said.
More notes from the Tuesday 5/5 Webcon:
- Curtis Wise opened Bucks Wild Fort Worth with a full-service restaurant on May 1, following all the guidelines and operating at 25% capacity. The city closed them down on May 4, because it was a “sexually oriented business.” They were challenging that at the time of the Webcon.
- Jenna Gross of Moving Targets shared a PDF of guidelines to reopen from the National Restaurant Association.
- “In addition to opening up and having your employees ready, you almost have to have a lawsuit ready to go. I think we’re going to need that,” Edinger said.
This article briefly summarizes extremely complex legal issues and is provided for general information purposes only and is not intended to provide either an exhaustive analysis of these matters or any specific legal advice or recommendation. Laws vary by state and municipality. Club operators and others are strongly encouraged to consult their own attorneys and accountants for specific advice on how these issues will affect their businesses and what measures to take.
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