Steamboat Springs City officials Thursday revoked the liquor license of Jade Summit restaurant and Pirate's Pub owner Kevin Nerney for what they called a violation of the state's liquor code of conduct.
The Steamboat Springs City Council, acting as the city's Liquor License Authority, voted, 3-2, to immediately revoke Nerney's liquor license after a lengthy, quasi-judicial hearing at Centennial Hall. The decision applies to both Jade Summit and its upstairs Pirate's Pub, located in Ski Time Square.
"He can no longer serve any liquor, period," Steamboat Springs Police Capt. Joel Rae said late Thursday afternoon. "As of right now."
Nerney's attorney, Kris Hammond, said he would look into an appeal.
City Council members Towny Anderson, Susan Dellinger and Karen Post voted for the revocation, while council members Paul Strong and Steve Ivancie voted against a punishment they called too harsh. Council members Ken Brenner and Loui Antonucci were not present.
Thursday's hearing was the continuation of proceedings that began Oct. 11, when Nerney was called before the city's liquor board because of accusations he violated state liquor codes of conduct. Nerney was arrested in February on a misdemeanor charge of unlawful sexual contact after an alleged incident at Pirate's Pub, but he was found not guilty of that charge in Routt County Court in August.
Despite the verdict in the criminal case, city officials proceeded with the administrative hearing as a separate case that City Clerk Julie Jordan said was required by state statutes regarding "conduct of establishment."
The Colorado Code of Regulations, enforced by the state Department of Revenue's Division of Liquor/Tobacco Enforcement, details lawful and unlawful conduct for liquor license holders and licensed businesses.
"To me, it was very clear that the boundary was crossed. : I definitely think there was a violation of the liquor license," Dellinger said after hearing testimony from witnesses including a Pirate's Pub employee, Nerney, and a member of the Colorado Sex Offender Management Board. In October, another pub employee, the patron and two friends testified before the council.
Thursday's hearing also included statements and cross-examinations from Hammond and city prosecutor Collette Erickson.
During testimony Thursday, Nerney acknowledged that improper contact occurred between him and the patron, but he said it was accidental. Nerney said he reacted to his February arrest with "shock and disbelief."
Hammond said the events of that night were "completely misinterpreted" by the patron and her two friends. He also stressed the importance of the jury's not guilty ruling in August, and said Nerney was exercising his rights to due process in Thursday's hearing.
"He's not going to roll over for the (city) staff or anybody else for something that he did not do," Hammond said. "And that's why we're here."
Erickson said Nerney was making "self-serving excuses" for improper conduct in the alleged incident.
"There is nothing difficult about this case at all - look at the weight of the evidence," she said. "None of the actions he took (in February) support the version of the events he is trying to tell you here today."
All five council members present Thursday said they found the testimony of the patron and her friends credible, more so than Nerney's. All five ruled that Nerney violated the state liquor code in the alleged February incident.
Jordan said the violation was Nerney's second within a year - in June 2006, Nerney was cited for serving alcohol to a minor at Pirate's Pub. His liquor license was suspended for seven days - with three of those days actively served, and four held "in abeyance" against future violations - as a result of that violation.
Jordan recommended a 29-day suspension for the second violation. Strong and Ivancie favored a lesser suspension.
"If you close a place down for a month, in some cases, you might as well revoke their license because of the financial burden," Strong said. "And I'm not sure that's where I'm at in this case."
Standards of proof
Nerney could have avoided Thursday's hearing in August, when the city offered him a 15-day suspension, with 10 days held in abeyance. Had he taken that offer, his liquor license would have been suspended for a total of nine days, including the four days in abeyance from the 2006 violation.
Nerney rejected that offer and chose the hearings.
Anderson, Dellinger and Post said Thursday that a "preponderance of evidence" and a concern for public safety led to their decision to revoke Nerney's liquor license.
"This is an egregious violation," Anderson said of the alleged February incident. "I'm thinking about the message to the public, and the protection of the patron : In my mind, it's an automatic revocation. No one, ever, should be subjected to this in an establishment in Steamboat Springs, Colorado."
Hammond called the decision a "death penalty" for Nerney and the family-owned restaurant and bar.
City attorney Dan Foote said the liquor board's decision could be appealed in district court, and added that Nerney could request a stay of the revocation while an appeal is pending.
Foote said that there is a "different standard of proof" in a criminal court case and a case before the city's liquor board.
"The criminal case involved several factual elements that didn't have to be proved in (front of the) liquor board," he said. "In this case, 'preponderance' means 'more likely than not.'"
Dellinger said Thursday's hearing was not about the criminal charges already settled in court.
"That's not what we're judging," she said. "We're judging his ability to hold a liquor license : which is a privilege."
Rae said Steamboat police are stepping up their enforcement.
"We are going to be doing liquor enforcement and compliance checks every month, indefinitely," he said.