Federal judge rules against Lake Nebagamon in legal battle with bar owner

MADISON — A federal judge found the village of Lake Nebagamon’s cabaret ordinance and part of a noise ordinance are unconstitutional and ordered the owner of the Waterfront Bar & Grill to prove the unconstitutional ordinances cost him money.

In striking down the cabaret ordinance and part of the village’s noise ordinance, District Judge Barbara Crabb this week wrote they gave “unfettered discretion” to the village in violation of John and Genevieve Graves’ 1st Amendment rights.

While the unconstitutional portion of the noise ordinance can be severed, saving the remainder of the law, the cabaret ordinance can’t and is struck down, Crabb wrote. The unlawful portions of the ordinances gives authorities too much discretion unrelated to the proper regulation of the bar, which can limit freedom of expression, she wrote.

The cabaret ordinance allows the village board to deny a license because a location is unsuitable or the operator is undesirable or unreliable but it doesn’t define “unsuitability ... undesirability or unreliability.”

While the noise ordinance sets proper restrictions on decibel levels and hours of operation, it also establishes an exemption for meetings, parades and other similar events with the village board’s approval. However, the ordinance doesn’t set guidelines for allowing the exemption, which, like the lack of restrictions in the cabaret ordinance, constitutes unfettered official discretion, Crabb wrote.

“With this unlimited discretion, the board has the ability to favor certain applicants over others based on the content of their proposed speech,” Crabb wrote in the 16-page decision.

The Graves acquired the former Finnells bar in 2000, which was in foreclosure and in need of repair. Since then they have invested about $100,000 in the property at 11530 E. Waterfront Drive, by adding a deck, a boat fueling station, and a mini-golf course, all of which have led to legal disputes with the village government.

The bar has offered live and recorded music and dancing indoors and outside, which has also brought conflict with the village.

In 2010, the village board enacted the noise and cabaret ordinances, which the Graves alleged were designed to restrict the entertainment they were providing.

The Graves filed suit in 2011 and with much of it withstanding the village’s motion to dismiss now must show how the ordinances cost them money.

In documents filed earlier, the Graves allege the ordinances have cost them $96,000 in profits lost due to outdoor concerts they couldn’t host; $28,000 in construction costs for their outdoor deck and Tiki bar, which could not be used as profitably as planned, and emotional distress resulting from the legal turmoil.

While the noise ordinance constitutionally restricts outdoor concerts to 10 p.m., it does allow exemptions the Graves applied for only twice and the village granted both requests.

“No harm there … At this point there are no facts in the record from which a jury could conclude that plaintiffs faced a genuine risk of being denied special event licenses.” Crabb wrote.

She gave Graves attorney, Glenn Stoddard, until Dec. 3 to brief the issue and the village until Dec. 10 to respond.

Tags: douglas county, news, money, food, business, courts, government