Bar owner fights licence restrictions
Liquor commission bans former Castro’s owner from the Dakota Tavern
The co-owner of the Dakota Tavern has initiated a judicial review of the Alcohol and Gaming Commission of Ontario over what he says is “entirely unfair “treatment regarding conditions attached to the tavern’s liquor sales licence.
Stephen Reid, who also owns Castro’s Lounge on Queen Street East, filed the notice for the review last Friday, saying his Ossington Avenue establishment is being penalized due to the presence of Anthony Greene, the one-time owner of Castro’s Lounge who now works for the Dakota.
According to Reid, the Dakota recently received conditions for its liquor sales licence renewal from the AGCO that include barring Greene from the establishment.
“Anthony is not allowed in the bar,” Reid said. “He’s not allowed adjacent to the bar. He’s not allowed to be employed in any manner and he’s not allowed to have any financial benefit.”
Raymond Kahnert, the AGCO’s senior communications adviser, confirmed that a written objection to the conditions had been received from the Dakota, reviewed and taken into consideration.
“The process was followed in the risk-based licensing assessment related to the Dakota Tavern,” Kahnert wrote in an email. “The information and comments provided by the licensee were considered in the assessment and mitigation of risk.”
Although the Dakota is currently closed due to the pandemic, Reid said Greene was essential to the operation of the venue in the 18 months before the pandemic, helping out as a bartender, a kitchen worker and purchasing supplies as needed.
“The bar is in a turning-around phase; it’s not making money,” Reid said. “When we’re allowed to open up again, the things that Anthony does will be critical to our organization. The things he does are things that if he doesn’t do them, somebody else has to do them and we don’t have the money to pay somebody else to do them.
“When we start up again, absolutely, Anthony is critical.”
In June 2018, Greene targeted an AGCO liquor inspector on her private Facebook page.
Greene fully admits he compared that inspector to Aunt Lydia, a brutal disciplinarian depicted in the Margaret Atwood novel and TV series “The Handmaid’s Tale,” and he was arrested six days later and charged with intimidation.
Although those charges were dropped two months later, on Nov. 29, 2018, the AGCO imposed a lifetime ban on Greene from the Castro’s Lounge premises, which he also admittedly breached twice.
That prompted the AGCO to issue a notice of proposal to revoke Castro’s liquor licence. Castro’s Lounge appealed to the Licence Appeal Tribunal, a quasi-judicial agency independent of the AGCO and part of Safety, Licensing Appeals and Standards Tribunals Ontario.
A hearing was set for January 2020, but Reid said Castro’s didn’t challenge the AGCO hearing because his legal representative at the time told him “he didn’t think he could win it.”
“He said the tribunal that we were going to was going to focus exclusively on the breaches,” Reid said.
“So they wouldn’t pay any heed to the fact that the conditions were harsh anyway.”
Instead, the parties settled when Greene agreed to relinquish his ownership shares to Reid on Jan. 21, 2020.
Castro’s was still penalized with a three-week closure after the agreement was accepted.
“They wanted two months, but my lawyer talked them down,” Reid said.
Around the time of the imposed ban, Greene and Reid had begun negotiations to purchase the Dakota Tavern, which included a hefty down payment and a six-figure investment loan from Greene’s mother-inlaw.
Reid said he felt that with the Castro’s Lounge situation still unresolved with the AGCO at the time, that Greene’s wife, Elizabeth Marshall, would be named shareholder along with Reid.
Instead, Greene worked at the Dakota once the sale was accepted by the venue’s prior owner.
Once it was made aware of Greene’s employment at the Dakota, the AGCO attached conditions to the tavern’s liquor sales licence — conditions that Reid feels have gone too far.
“The sanctions first placed against Anthony are ridiculous, because they consider him a threat and he’s no threat to anyone.”
Reid submitted a 100-page objection to the charges, but the AGCO indicated that no changes would be made to the conditions.
“The only reason that they gave for the conditions of the Dakota was the incident at Castro’s,” Reid said. “That is the sum total of what they were willing to advise to us. We asked for documentation through our lawyer. They refused to provide anything, just that one basic statement.
“Any rational person who read that would not come to the conclusion that they did, and our lawyer said that this is one of the most egregious things he has ever seen a government agency do,” Reid said.
According to Kahnert, the AGCO employs a “risk-based licensing approach” to issuing and regulating liquor sales licences that allows the provincial government-run organization “to encourage good business practices throughout the industry and to strategically focus regulatory resources where they will make the most difference.”
One of the principles behind risk-based licensing listed on the AGCO website is: “To identify persons or places that pose specific risks to the public safety or the public interests.”
One of the 14 conditions that can impact whether a liquor sales licence is revoked is called “Prohibited Person(s).”
Reid said he hopes the judicial review will back him up and hold the AGCO accountable.
“I hope that the judicial review will order all the conditions quashed at the Dakota, and then turn around and do the same thing for Castro’s,” Reid said. “And that if the AGCO wishes to try and impose conditions, that they do it in a process that allows us a hearing and that allows us a right of appeal.
“And that they be prevented from ever in the future doing this to anybody else. This just isn’t about us — this could be a significant precedent-setting case. This government agency is essentially bullying people and allowed to run roughshod without any due process or natural justice. If there’s going to be a review of something, it should be done independently.”
Reid said the whole process has been “an absolute nightmare for 2 1⁄2 years” and it’s driven him to depression and anxiety, “drastically affected my mental health, my physical health — it’s been terrible for all of us.”
Like every other music venue in the city, the Dakota is hurting financially. Reid said an attempt to sell takeout food in October and November didn’t pan out.
“We lost money, so we shut it down.”
He still hasn’t seen any of the promised 50 per cent venue property tax relief passed by the City of Toronto in June, but managed to overcome one other hurdle facing the majority of Canadian music venues: he obtained reduced liability insurance.
Reid, who says he has sunk $40,000 of his own money into battling the AGCO — which, he points out, is funded by taxpayers — has launched a GoFundMe campaign to help with the legal fees.
“Our lawyer says we need about $50,000 to go ahead with this for the judicial review and perhaps more if there’s an appeal. It’s getting to a point where the expenses are prohibitive. There are no other sources of funding. The only way to go forward is to get into serious debt,” he said.
And if this issue isn’t resolved? “I’m not interested in continuing with either (Castro’s or the Dakota) if we can’t resolve this,” Reid said.
“This government agency is essentially bullying people and allowed to run roughshod without any due process or natural justice.”
STEPHEN REID
DAKOTA TAVERN OWNER