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Wednesday, August 3,2011

Liquor theatrics

What is the American Theatre Corp. and why did the Meridian Township Board of Trustees recommend it for a free liquor license above four local businesses?

by Andy Balaskovitz
Andrew Manuel has plans to expand and
remodel his breakfast and lunch restaurant in Haslett. He wants to
expand Blondie’s Barn, which he co-owns with his wife, Dawn, at 5640
Marsh Road, to offer dinner, a full-service bar and more staff. Standing
in his way is a $50,000 liquor license.

Manuel said the Meridian Township Board
of Trustees thwarted his plans when it voted nearly unanimously last
month to recommend a rare, free liquor license for an out-of-state
corporation that wants to take over the AMC Meridian Mall 6 in Okemos.


The company, American Theatre Corp.,
reportedly has a history throughout the country of launching plans for
movie theaters that serve restaurant-style food with a full-service bar.
Some of those endeavors failed or never came to fruition because the
company’s subsidiaries didn’t pay rent or disclose financial information,
according to media reports. Courts in four states have ordered the
company’s subsidiaries to pay more than a total of $5 million for “broken
contracts and rent not paid,” one Florida newspaper reported.


The board recommended that the state
Liquor Control Commission grant the license to the Lansing Theatre Co., a
subsidiary of the American Theatre Corp. Lansing Theatre Co. gives its
address as 1999 Central Park Drive in Okemos, the same as AMC Meridian
Mall 6. 


Manuel is having a hard time digesting the board’s decision.


“From a business perspective, it made
more sense to give it to the small guy,” Manuel said of the board’s
decision. “That killed my project.”


The Meridian Township Board of Trustees
voted 6-1 at its July 5 meeting to recommend to the state Liquor Control
Commission a “quota” liquor license for Lansing Theatre Co. One online
company profile says the corporation has offices in seven states. That
profile also says the company has an annual revenue of more than $30
million and employs 572 people.


Will White, owner of the Traveler’s Club
International Restaurant and Tuba Museum who also sits on the Meridian
Economic Development Corp.’s board, said the company has plans to spend
nearly $2 million on renovating the AMC-6 theater in the Okemos mall,
which is still in operation. Part of that includes adding a restaurant
and bar feature to the theater.


White said the township has one available
quota license. Quota licenses issued by the state Liquor Control
Commission are based on population — one “on-site” permit is allowed for
every 1,500 people. When multiple applicants seek the license, it’s the
local governing body’s decision to approve a resolution recommending
approval for it. Along with Blondie’s and Lansing Theatre Co., Coffee
& Friends Café and “two applicants with Coney Island establishments”
also applied, board meeting minutes show. Lansing Theatre’s application
is pending before the commission.


White said escrowed liquor licenses
typically cost $50,000 to $60,000, but that the quota license is
essentially free. There are 58 active or escrowed liquor licenses in
Meridian Township.


“Blondie’s is a local business,
family-owned. And it’s already in business and could use it
immediately,” White said. “The whole point being: The other guys could
afford to buy one. Then we’d actually end up with two new liquor
licenses instead of just one. It’s a win, win, win.”


White said the board also rushed into the
decision, which wasn’t necessary because a lease agreement is still yet
to be reached with the mall. “It just didn’t make any sense to me
without any basic research or due diligence,” White said.


Meridian Mall general manager Larry Parsons did not return calls for comment.


American Theatre Corp. could not be
reached for comment on this story. Four different telephone numbers
surfaced while researching the company: one is temporarily disconnected;
a second is no longer in service; and two had busy signals for two
days. While two of the numbers are listed for Colorado and Nevada
offices, all four have 404 area codes, which is in the Atlanta area.


Further, no website exists for this
company, and it is not a member of the National Association of Theatre
Owners, which represents more than 5,000 theaters in the U.S., said
NATO’s director of media and research, Patrick Corcoran.


Media reports from Orlando, Fla., and
Suffolk, Va., detail similar plans by American Theatre Corp.’s offshoots
that ultimately failed. In Suffolk, the developer of a mixed-use
project filed suit to terminate a lease agreement before the theater
opened with American Screen Works — a local subsidiary of American
Theatre Corp. — because it  “misrepresented
its financial information and business history,” according to a 2007
Virginian-Pilot news story. In Orlando, the Orlando Movie Co. — whose
CEO, James T. Duffy, is the same as American Theatre Corp.’s — opened a
theater in 2009 that closed in about six months after failing to pay
rent, the Orlando Sentinel reported.


That newspaper also reported in 2009 that
local branches of American Theatre Corp. have been ordered to pay
$200,000 in Maryland, $450,000 in Mississippi, $2.5 million in Texas and
$1.9 million in Florida for “broken contracts and rent not paid” while
the theaters were operating.


While American Theatre Corp. could not be
reached for comment, the current operator of the Okemos theater, AMC
Theatres, called it “speculation” that it was even moving out.


“AMC does not comment on rumors or speculation about theatre closings,” AMC spokesman Ryan Noonan said in an e-mail. 


Township Supervisor Susan McGillicuddy
said it was her understanding that, based on past conversations with
Parsons of Meridian Mall, AMC would move out when its lease expires Oct.
1. McGillicuddy supports giving the license to the theater: “For me,
it’s in the best interest to keep the mall viable.”


Board trustee Lynn Ochberg wanted the July 5 minutes to
reflect that Blondie’s would be the second choice should anything fall
through with American Theatre Corp.


Ochberg, who is the board liaison for the EDC, was a yes vote because the theater shows greater economic potential.


“The tax return and revenue from the
theater group is 10 times greater than the other four applicants,” she
said. “Of course we would have preferred to give it to a local vendor,
but we’ve got to go where the money is at this time.”


Yet Township Manager Gerald Richards said
during the July 5 meeting that American Theatre Corp. planned to move
here with or without the liquor license. Ochberg acknowledged that, but
McGillicuddy said “that isn’t what I understood prior to the (July 5)
meeting … based on conversations I’ve had with (mall management).”


Trustee Brett Dreyfus said it was a
“difficult decision” to vote yes on recommending the license for the
theater. “I think adding the liquor license just makes sense in this
case. It’s a combination of the type (of business) and where it’s
located,” he said. “I eat at Blondie’s and I appreciate Blondie’s. The
local issue is sometimes trumped by the larger picture.”


Trustee Elizabeth LeGoff was the lone no
vote. Along with having concerns about serving alcohol at a theater that
may be showing PG movies, she thought the liquor license should have
gone to a local business.


“I thought it was really unconscionable,”
LeGoff said of the recommendation. “We did not give a liquor license to
a local thriving business but we’re giving one to a business from the
outside, which has made promises but will they deliver?”

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