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Tough Times at Rich's

Trouble keeps following the infamous Midtown dance club like a cloud.

Night Life

No doubt this is not the way Rich's wanted to celebrate its 30th anniversary this year. The most recent tenants of the long-running and equally star-crossed Midtown dance club closed their doors April 12 with no reason given but a promise to return, according to a post on the club's Facebook page.

"We regret to inform you that Rich's has closed its doors," the message said. "Thank you for all the years of support and stay tuned for future announcements regarding shows, promotions, etc! Thank you Houston!"

A further note by Rich's in the comments section said, "We will be announcing new plans soon! Thanks for all the love and support!"

Anthony Morello of Sine Entertainment, the promoter of the Fully Loaded rotating-DJ event that had been scheduled for Saturday night at Rich's, posted this message on his Facebook page:

"We were taken by surprise just like most of you, and still don't have many details other than what is currently out on social media," it said. "We want to assure you all that we are NOT canceling FULLY LOADED and are actively and aggressively looking for a new home for it. We will keep everyone updated with details as soon as we have them."

Most recently, Rich's was sued by a promoter who alleged that the club's then-current operators, doing business under the name Rich's Sacred Ground, refused to provide an accurate accounting of liquor sales in conjunction with a party hosted by the rapper Jay-Z over NBA All-Star Weekend in February.

According to the Courthouse News Service, the suit brought by All Pro Management alleges, "Defendants brought in outside alcohol that did not have the TABC stamps to accurately track the inventory. Likewise, defendants did not ring up all liquor sales on their point of sales system. In fact, defendants probably manipulated the POS system to reflect lower sales and pay less taxes and charges to the Texas Alcoholic Beverage Commission."

On February 19, the Tuesday after NBA All-Star weekend, a Harris County judge granted a restraining order against the club, enjoining it from "disposing or secreting any cash funds" or destroying any evidence and ordering it to produce documents relating to the business, including bank receipts and security-camera footage.

Houston Press staff writer Craig Malisow, who reported on the lawsuit for Hair Balls in February, says that he has not heard any further updates about that case.

Rocks Off ran a quick records check on the TABC Web site, and it confirms that Rich's Sacred Ground was cited for a cash-law violation and given a written warning on February 19. It also owes almost $117,000 under the agency's credit law to Mr. B's Bar Supply and Liquor of Pasadena as of March 4, records show.

TABC spokeswoman Carolyn Beck says a cash-law violation essentially means bouncing a check, and that a liquor bill that steep meant that the club would be unable to buy wine or distilled spirits from any other liquor wholesaler until the debt is paid. Closing its doors Friday night could mean the club ran out of alcohol, she adds.

In October of last year, Rich's Sacred Ground took over ownership and management of the club, which has been open since 1983 under several different owners and has a long history of running afoul of the TABC. According to the Web site business-bankruptcies.com, Rich's Sacred Ground filed for bankruptcy in January of this year, listing assets of $1 million-$10 million and liabilities of $50,001-$100,000.

Nassim Joseph, the property owner of 2401 San Jacinto — but not a partner in Rich's Sacred Ground — told Malisow on April 15 that the previous Friday a judge had granted him a relief from the suspension of Joseph's rights as a landlord that had occurred as part of the bankruptcy filing, a move the tenants did not oppose. Essentially, they left before Joseph could kick them out, and moved out late Thursday night or early Friday morning, the landlord added.

Joseph, who also owns the name Rich's, said that the club shouldn't be closed for long and that he is already talking to several potential legitimate operators. He locked out his previous tenants, who had been running the club under the name Club Rich's LLC, after one of the owners was allegedly involved in an altercation that led to a Katy man's death outside the club in February 2012. That suit is still pending, Harris County civil court records show.

Since the Rich's Sacred Ground partners moved in, Joseph says they had paid only one month's rent and may also owe other taxes.

Cade Michals, a spokesman for Rich's Sacred Ground, confirmed that Joseph took possession of the property at 2401 San Jacinto, and said that the landlord had a "history" with his previous tenants and had been making false allegations against them online.

Late that afternoon, Michals sent the Houston Press a statement that read, in part:

"Mr. Joseph has a history of inventing investigations to create a biased vibe against his past tenants to make him more 'victim' like. No such investigations ever resulted from Mr. Joseph's past statements on his past tenants.

"In regards to owing TABC money, this allegation is unfounded," the statement continued. "Actually RSG called TABC and 'Self-Reported' prior to the Blacklist, and informed TABC that because RSG over-ordered for NBA-All Star, there would be some issues. RSG has been in close communications with TABC and fully are cooperating with any thing they are needing.

"We fully expect that through discovery of the multiple lawsuits that a lot of the false allegations and rumors on social media will shed a better light on all the true details."

Houston Press staff writer Craig Malisow contributed to this article.

 
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