Before the

DISTRICT OF COLUMBIA
BOARD OF ZONING ADJUSTMENT
Appeal No. 18114-B
MOTION FOR STAY PENDING APPEAL
RCX, LLC, the current lessee of the subject property and an intervenor in these
proceedings, by and through undersigned counsel, and pursuant to D.C. Court of Appeals Rule
18(a)(1), hereby moves to stay the Decision and Order on Remand entered by the Board of
Zoning Adjustment (BZA) on September 26, 2016 in Appeal No. 18114-B.
1.

RCX, LLC (RCX) intervened in this matter on June 2, 2015, when prior

counsel for RCX filed a Notice to Represent and Brief in response to the BZAs Briefing Order
on Remand.
2.

On September 26, 2016, the BZA issued its Decision and Order on Remand,

which reversed the determination of the Zoning Administrator in the issuance of Certificate of
Occupancy No. CO1101152 to the Stadium Group, LLC.
3.

Certificate of Occupancy No. CO1101152 was issued to the Stadium Group, LLC

on June 24, 2011.

4.

Stadium Group, LLC assigned its lease to RCX, LLC, and a new certificate of

occupancy, No. CO1500097, was issued to RCX, LLC on November 18, 2014.
5.

On October 5, 2016, RCX, LLC filed a Petition for Review with the District of

Columbia Court of Appeals of the BZAs September 26, 2016 Decision and Order on Remand.
6.

RCX, LLC now moves to stay the September 26, 2016 Decision and Order on

Remand pending the previously filed Petition for Review, for the reasons stated in the attached
Memorandum in Support of Motion for Stay Pending Appeal.
1

WHEREFORE, RCX, LLC, by and through undersigned counsel hereby moves to stay
the September 26, 2016 Decision and Order on Remand, and directs the BZA to the arguments
and authorities stated in the attached Memorandum.
Respectfully submitted,
RCX, LLC
BY COUNSEL
___/s/________________________
Scott H. Rome, Esq. [476677]
Stephen J. Whelan, Esq. [1010351]
1225 19th Street, NW, Suite 320
Washington, DC 20036
Phone: (202) 686-7600
srome@theveritaslawfirm.com

CERTIFICATE OF SERVICE
I hereby certify that on this the 24th day of October, 2016, a copy of the foregoing
Motion was served via electronic mail to:
Clifford Moy
Secretary, Board of Zoning Adjustment
District of Columbia Office of Zoning
441 4th Street, N.W.
Suite 200-210 South
Washington, D.C. 20001
clifford.moy@dc.gov

RF Holdings, LLC
c/o Shapiro, Lifschitz & Schram
1742 N Street, N.W.
Washington, D.C. 20036
hubert@slslaw.com
Attorney for Intervenor/Permit Holder

Don Padou, President

Ward 5 Improvement Association
186 Fieldstone Drive
Murphys, CA 95247
padou@padoulaw.com
Appellant
Chairperson
Advisory Neighborhood Commission 5C
P.O. Box 80127
Washington, D.C. 20018
5C@anc.dc.gov

via mail:
Keith Forney, Managing Member
Stadium Group, LLC
2127 Queens Chapel Road, N.E.
Washington, D.C. 20018
Intervenor/Permit Holder

Matthew LeGrant, Zoning Administrator

Dept. of Consumer and Regulatory Affairs
Building and Land Regulation Administration
1100 4th Street, S.W., Room 3100
Washington, D.C. 20024
matthew.legrant@dc.gov

Maximilian Tondro
Office of General Counsel
Department of Consumer and Regulatory
Affairs
1100 4th Street, SW, Suite 5266
maximilian.tondro@dc.gov

Charles Thomas, Esq.

Interim General Counsel
Office of General Counsel
Dept. of Consumer and Regulatory Affairs
1100 4th Street, S.W., 5th Floor
Washington, D.C. 20024
charles.thomas@dc.gov

Sara A. Bardin
Director, Office of Zoning
441 4th Street N.W., Suite 200/210-S
Washington, D.C. 20001
sara.bardin@dc.gov

___/s/________________________
Scott H. Rome, Esq. [476677]

Before the
DISTRICT OF COLUMBIA
BOARD OF ZONING ADJUSTMENT
Appeal No. 18114-B
MEMORANDUM IN SUPPORT OF MOTION FOR STAY PENDING APPEAL
RCX, LLC, current operator of the Stadium Club, hereby states as follows in support of
its Motion for Stay of the Decision and Order on Remand (the Order) entered by the Board of
Zoning Adjustment (BZA) on September 26, 2016 in Appeal No. 18114-B.
Background
On August 24, 2012, the BZA issued its Decision and Order in Appeal No. 18114, in
which the Appellant, Ward 5 Improvement Association (the Association), challenged the
certificates of occupancy that authorized the Stadium Club to operate as "Nightclub and
Restaurant with accessory parking (Not a Sexually Oriented Business Establishment)." The
certificates of occupancy which form the basis of Ward 5's Appeal are Certificate of Occupancy
No. 1001838 issued on April 21, 2010, Certificate of Occupancy No. 1002471 issued on June 22,
2010, and Certificate of Occupancy No. CO1101152 issued on June 24, 2011. The August 24,
2012 Order denied the Associations challenge.
The August 24, 2012 Order was subsequently vacated and remanded by the District of
Columbia Court of Appeals, in Ward 5 Improvement Association v. District of Columbia Board
of Zoning Adjustment, 98 A.3d 147 (D.C. 2014). The Court of Appeals' opinion included the
following remand instruction:
On remand, the BZA is directed to consider whether the ZA erred in granting Stadium
Club the second permanent certificate of occupancy on June 24, 2011, given the

information available to the ZA at that time. In particular, the BZA shall consider
whether the kind of dancing featured at Stadium Club involves "fondling," "erotic
touching," or acts of "sexual stimulation or arousal," as the BZA interprets those terms in
light of its precedent. The BZA may consider whether these activities occur despite
Stadium Club's "Rules and Regulations for Dancers" that purport to ensure compliance
with zoning requirements.
After the case was remanded, the BZA held closed meetings to consider the issues raised by the
Court of Appeals. On remand, the BZA issued an order reversing the determination of the
Zoning Administrator in the issuance of Certificate of Occupancy No. CO 11011152 to the
Stadium Group, LLC. RCX, LLC filed a Petition for Review with the District of Columbia
Court of Appeals of the BZAs September 26, 2016 Decision and Order on Remand, and now
moves to stay the September 26, 2016 Decision and Order on Remand for the reasons set forth
herein.
Argument
In determining whether to grant a stay, the BZA may consider the following factors:
whether the party filing the motion is likely to succeed on the merits; whether denial of the stay
will cause irreparably injury; whether, and to what degree, granting the stay will harm other
parties; and whether the public interest favors granting a stay. See 11 DCMR 11-Y701.4;
Kuflom v. District of Columbia Bureau of Motor Vehicle Services, 543 A.2d 340, 344 (D.C.
1988). When the last three factors strongly favor interim relief, only a substantial showing of
likelihood of success, not a mathematical probability, is necessary for the court to grant a stay.
Barry v. Washington Post Co. 529 A.2d 319, 320-321 (D.C. 1987); citing Washington
Metropolitan Area Transit Commission v. Holiday Tours, Inc., 182 U.S.App.D.C. 220, 222, 559
F.2d 841, 843 (1977). RCX will now take each of the Kuflom factors and discuss them in turn.
I.

If the stay is denied, RCX will be irreparably injured.

Per an email from the District of Columbia Office of the General Counsel dated October
19, 2016, the District of Columbia Department of Consumer and Regulatory Affairs (DCRA)
has determined that the Order requires DCRA to revoke the 2011 Certificate of Occupancy as
well as the 2014 Certificate of Occupancy, retroactive to October 6, 2016. The result of this
DCRA action will be that the Stadium Club will be without a certificate of occupancy, forcing
the Club, operated by RCX, LLC, to close its doors. If the Stadium Club is forced to
permanently close its doors, there is no doubt that it will be irreparably harmed, as it will cease
to exist. See International Long Term Care v. Shalala, 947 F.Supp. 15, 18 (D.D.C. 1996)
(finding that a business being forced to close its doorsis just the sort of irreparable and
unnecessary harm thatinjunctive relief is intended to prevent.).
Moreover, District of Columbia courts have recognized that monetary loss may constitute
irreparable harm where the loss threatens the very existence of the movants business. See
Wisconsin Gas Co. v. F.E.R.C., 758 F.2d 669, 674 (D.C. Cir. 1985). There can be no question
that if Stadium Club is not permitted to remain open, the result will be a tremendous monetary
loss. The Club derives substantial revenue from fees charged to patrons who enter the club, and
for food and drinks once inside. Thus, even if the Stadium Club is forced to close for a finite
amount of time, the loss of income could be so significant as to cause Stadium to become
financially insolvent. Stadium Club, like many other retail establishments, operates on thin
profit margins and needs to remain open for business to pay its various expenses. Even being
forced to close for two or three weeks could result in the closure of the business which would
leave its dozens of employees without employment.
In addition, the Club would experience a significant loss of business goodwill if forced to
close its doors for an extended amount of time. See Merrill Lynch, Pierce, Fenner & Smith, Inc.

v. Schultz, 01-0402, 2001 WL 1681973 (D.D.C. Feb. 26, 2001) (citing loss of goodwill as a
factor which bolsters a claim of irreparable harm). If the Club were to be closed, many of its
regular clientele would take their business to one of the other 10 or 11 similar establishments in
the area. Given the foregoing, there can be no question that the Stadium Club would be
irreparably injured if enforcement of the Order is not stayed.
II.

The opposing party, Ward 5 Improvement Association, will not be harmed by a

stay.
The Ward 5 Improvement Association is the only party that is expected to oppose this

Motion for Stay. The Association originally appealed the issuance of the Stadium Clubs
certificate of occupancy, and has also taken the position that the current Certificate of
Occupancy should be revoked. The Association, however, cannot assert any legitimate
argument that it would be materially harmed by the issuance of a stay, which would allow the
establishment to remain open during the limited time of an appeal. While RCX does not
concede that the Association is harmed at all from a stay, any potential harm from permitting the
Club to continue to operate until the appeal is heard would be entirely abstract. This potential
harm is especially abstract, and of an especially small degree, in relation to the real, immediate,
and immense harm that RCX would face, as set forth above. Again, RCX will lose its right
operate the business that it has operated since 2013.
The degree of harm to the Association, as compared to the loss of a business, is
miniscule at best. If the motion is granted, the Association will continue to exist as a citizens
association in a metropolitan area that, in apparent contradiction to the preference of its member
Don Padou, contains an establishment that it contends is improperly operating in a sexually
oriented manner. The issue of harm is especially dubious given that the Association appears to

consist solely of Mr. Padou, who resides in the state of California. The Association does not
appear to have any function other than its crusade to have the Stadium Club closed.
Regardless of whether the Association or the BZA is considered the opposing party for
the purposes of this motion, granting the motion presents no potential for monetary harm,
physical harm, emotional harm, or any other appreciable harm, other than a sense that the
metropolitan area is better served without such a business continuing to operate. It remains
unclear how the Association could plausibly claim that continued operation, even in an
allegedly sexually oriented manner, would bring harm to this Association, whose members
presumably do not intend to visit the establishment. It is left to that Association to make some
assertion that the mere presence of an allegedly sexually oriented business in the District of
Columbia harms their interests. Any such abstract definition of harm, however, does not meet
the traditional definitions of any degree of harm that would be necessary to justify denying a
stay.
III.

Granting the Stay would not harm the public interest.

There would be no demonstrable harm to the public interest if a stay is granted. RCX

has been operating the Stadium Club since 2013, without causing quantifiable any harm to the
public. The Stadium Club provides a service to the public. It is in the interest of the public to
keep open places of public accommodation. Given the thousands of customers that frequent the
Stadium Club, its continued operation is in the public interest. Any allegation that the Club is
detrimental to the public interest would be based on the abstract and dubious argument that
establishments which offer adult entertainment are amoral.
IV.

RCX, LLC can show a substantial likelihood of success on the merits of its case.

As has been mentioned previously, RCX filed a Petition for Review of the BZAs Order
on October 5, 2016. There is a substantial likelihood that the D.C. Court of Appeals will reverse
the BZAs Order and again remand this matter for further proceedings. There are a variety of
reasons that RCX has a substantial likelihood of success on the merits of its appeal. First, the
Order is legally deficient, as BZA orders must (1) make findings of fact on each material
contested issue of fact; (2) use substantial evidence of record to support each finding; and (3)
arrive at conclusions which are legally sufficient to support the decision, and which flow
rationally from the findings. Oakland Condo. v. D.C. Bd. of Zoning Adjustment, 22 A.3d 748,
751 (D.C. 2011). The BZAs Order failed in all respects, as explained in further detail herein.
Moreover, the Associations appeal which led to the Order on Remand should have been
dismissed as moot. For those reasons, and because the Order violates due process, its effect
should be stayed while the Order is appealed to the District of Columbia Court of Appeals.
a. The Order fails to make findings of fact on each material contested issue of fact.
Again, the District of Columbia Court of Appeals remanded this matter while instructing
the BZA to consider:
Whether the ZA erred in granting Stadium Club the second permanent certificate of
occupancy on June 24, 2011, given the information available to the ZA at that time. In
particular, the BZA was asked to consider whether the kind of dancing featured at
Stadium Club involves "fondling," "erotic touching," or acts of "sexual stimulation or
arousal," as the BZA interprets those terms in light of its precedent. The BZA may
consider whether these activities occur despite Stadium Club's "Rules and Regulations
for Dancers" that purport to ensure compliance with zoning requirements.
Ward 5 Improvement Ass'n v. D.C. Bd. of Zoning Adjustment, 98 A.3d 147, 156 (D.C. 2014).
Despite this instruction, the BZA failed to make sufficient factual findings about whether the
dancing featured at Stadium Club involved fondling, erotic touching and acts of sexual
stimulation or arousal. The BZA also failed to interpret the terms fondling, erotic touching

and sexual stimulation or arousal in light of their existing precedent, and to consider whether
those activities occurred despite the Club's rules and regulations prohibiting such conduct. The
BZA did not hear any evidence with respect to the Clubs rules and whether such conduct was
prohibited by the Club.
b. The Order does not support each finding with substantial evidence.
The Order relies almost entirely on the biased affidavits which were created by
individuals who were compensated by the Association. Furthermore, the affidavits were based
solely on the experience of two individuals who visited the Stadium Club on one night June
16, 2010. The affidavits also refer only to three dancers, of the dozens that work at the Club.
The Order errs in relying on the two affidavits, which discussed only three dancers, and which
were based on one visit to the Stadium Club. There were no findings, conclusions, or other
portions of the Order which found that the policy of the establishment was to permit, promote or
allow the prohibited conduct, even if it was found that the conduct occurred on this one night.
As a result, the Order does not come close to finding substantial evidence that fondling, erotic
touching and acts of sexual stimulation make up a substantial or significant portion of the
Stadium Club's business.
c. The Orders conclusions do not flow rationally from its findings of fact.
The Order does not adequately weigh evidence, but instead merely states facts and make
conclusions. The Order does not weigh the relative credibility of the various individuals who
provided affidavits and testimony, nor does it credit or discount conflicting evidence. Unbiased
observers submitted evidence which was drastically different from that found in the self-serving
affidavits offered by the Association. Despite this, the BZAs Order made no mention of why
certain testimony was favored or given greater weight than other testimony.

10

The Order also fails to include any basis for the standard it adopted of what constitutes a
SOBE. In addition, the adopted standard does not follow the California Steak House case,
decided by the BZA on July 7, 1983. Finally, the BZA made conclusions despite members of
the BZA failing to reach consensus during their meetings.
d. The Associations appeal, which resulted in the Decision and Order on Remand,
should have been dismissed as moot because the certificates of occupancy at
issue in the appeal have not been in use since November 13, 2014.
The Court of Appeals defined the limited scope of the inquiry in this remand, as it
directed the BZA to "consider whether the ZA erred in granting Stadium Club the second
permanent certificate of occupancy on June 24, 2011, given the information available to the ZA
at that time. Ward 5 Improvement Ass'n v. D.C. Bd. of Zoning - Adjustment, 98 A.3d 147, 156
(D.C. 2014). Since the June 24, 2011 certificate of occupancy was issued, however, the Stadium
Club underwent a change of ownership. In fact, DCRA issued a new certificate of occupancy to
RCX, LLC trading as Stadium Club on November 13, 2014. See Certificate of Occupancy No.
CO1500097. As a result, no entity operated under the certificate of occupancy which was the
subject of the appeal making the appeal moot. Despite this, the BZA concluded that the
appeal was not moot, and instead used the invalidity of the 2011 certificate of occupancy to
affect the rights of RCX by invalidating the 2014 certificate of occupancy. This result was
improper, and the Order should be stayed pending a review by the Court of Appeals.
e. The Order would have the effect of violating the due process rights of RCX,
LLC.
The BZAs Order does not address the current operations of the Stadium Club under the
current ownership. The BZA acknowledged as much, stating that [t]he Board agrees with
DCRA that this order should not address the certificate of occupancy issued to the Stadium Club

11

in 2014. The 2014 certificate of occupancy was not in the record at the time of the Boards
decision on remand in this proceeding, and the Board has no information about the circumstances
of its issuance. Order at p. 10. Then, after confirming that the BZA had no knowledge about the
Clubs current operations, the BZA ordered that RCXs certificate of occupancy was issued in
error. The effect of this action, whether intentional or not, is that the Stadium Club is at risk of
being shut down without having the opportunity to show that RCXs operation of the Club
complies with the newly created standard for what constitutes a sexually oriented business
enterprise (SOBE).
Given the limited scope of the BZAs inquiry on remand, the BZA overstepped by taking
action which has such a tremendous effect on RCX. The current Certificate of Occupancy was
issued to RCX, LLC, which is an entity separate from Stadium Group, LLC, to whom the
previous certificates of occupancy were issued. In conjunction with the ownership change to a
wholly separate entity, the management and operations of the Stadium Club have changed
drastically since the time that the previous certificates of occupancy were issued. As a result, the
evidence presented to the BZA regarding the operations of the Stadium Club prior to issuance
of the second permanent certificate of occupancy on June 24, 2011 are irrelevant to the question
of whether or not the Stadium Club, in its current iteration, is a SOBE.
The only evidence relevant to the determination of whether the Stadium Club is
currently a SOBE would be any evidence of the Club's operations following the change of
ownership from Stadium Group, LLC to RCX, LLC. Given that the most recent evidence of the
operations of the Stadium Club before the BZA is from prior to June 24, 2011, RCXs
operations should not be affected by the Order. Revocation or invalidation of RCX, LLC's
certificate of occupancy constitutes a denial of due process. It is well settled that it is a

12

violation of due process for a judgment to be binding on a litigant who was not a party or a privy
and therefore has never had an opportunity to be heard." Simon v. Circle Assocs., 753 A.2d 1006,
1010 (D.C. 2000) citing Parklane Hosiery Co. v. Shore, 439 U.S. 322, 327 n.7 (1979).
While RCX did intervene in this matter on June 2, 2015, no evidentiary hearings have
been held and no new evidence has been collected since that time. In fact, no new evidence has
been collected since RCX took ownership of Stadium Club. Thus, not only has RCX not been
permitted to introduce evidence of its operations, but it also did not have a chance to cross
examine previous witnesses. "In almost every setting where important decisions turn on questions
of fact, due process requires an opportunity to confront and cross-examine adverse witnesses."
Goldberg v. Kelly, 397 U.S. 254, 269, (1970); see also Glenbrook Rd. Ass'n v. District of
Columbia Bd. of Zoning Adjustment, 605 A.2d 22, 39 (D.C. 1992) ("in all adjudicative
proceedings, cross-examination and confrontation are the handmaidens of trustworthiness in the
face of a factual dispute").
RCX does not argue that the BZA is prevented from setting the standard applicable to
determine whether a business is a SOBE. However, the BZAs Order should not result in RCXs
current Certificate of Occupancy being invalidated without finding particular facts with regard
to RCX or holding a hearing related to RCX. Given that RCX has had no opportunity to
introduce evidence or cross examine previous witnesses, and given that no evidence exists in the
record of RCX's operations of the Stadium Club, the effect of the Order should be stayed
pending the appeal filed on October 5, 2016. Instead, the BZA should have given RCX an
opportunity to show that it is in compliance with the current rules governing non sexually oriented
businesses.

13

Conclusion
Given the foregoing, the BZA should stay any pending action based on its September 26,
2016 Order, until such a time that the District of Columbia Court of Appeals has ruled on RCX,
LLCs Petition for Review.
Respectfully submitted,
RCX, LLC
BY COUNSEL
___/s/________________________
Scott H. Rome, Esq. [476677]
Stephen J. Whelan, Esq. [1010351]
1225 19th Street, NW, Suite 320
Washington, DC 20036
Phone: (202) 686-7600

14

CERTIFICATE OF SERVICE
I hereby certify that on this the 24th day of October, 2016, a copy of the foregoing
Motion was served via electronic mail to:
Clifford Moy
Secretary, Board of Zoning Adjustment
District of Columbia Office of Zoning
441 4th Street, N.W.
Suite 200-210 South
Washington, D.C. 20001
clifford.moy@dc.gov

RF Holdings, LLC
c/o Shapiro, Lifschitz & Schram
1742 N Street, N.W.
Washington, D.C. 20036
hubert@slslaw.com
Attorney for Intervenor/Permit Holder

Don Padou, President

Ward 5 Improvement Association
186 Fieldstone Drive
Murphys, CA 95247
padou@padoulaw.com
Appellant
Chairperson
Advisory Neighborhood Commission 5C
P.O. Box 80127
Washington, D.C. 20018
5C@anc.dc.gov

via mail:
Keith Forney, Managing Member
Stadium Group, LLC
2127 Queens Chapel Road, N.E.
Washington, D.C. 20018
Intervenor/Permit Holder

Matthew LeGrant, Zoning Administrator

Dept. of Consumer and Regulatory Affairs
Building and Land Regulation Administration
1100 4th Street, S.W., Room 3100
Washington, D.C. 20024
matthew.legrant@dc.gov

Maximilian Tondro
Office of General Counsel
Department of Consumer and Regulatory
Affairs
1100 4th Street, SW, Suite 5266
maximilian.tondro@dc.gov

Charles Thomas, Esq.

Interim General Counsel
Office of General Counsel
Dept. of Consumer and Regulatory Affairs
1100 4th Street, S.W., 5th Floor
Washington, D.C. 20024
charles.thomas@dc.gov

Sara A. Bardin
Director, Office of Zoning
441 4th Street N.W., Suite 200/210-S
Washington, D.C. 20001
sara.bardin@dc.gov

___/s/________________________
Scott H. Rome, Esq. [476677]

15