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77-5765R2 RESOLUTION N0. 5765 RESOLUTION RL'VOKING SAUI~?A LICENSE ISSUED TO PARADISE PALACE SAUNA BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: I. The City Council herewith finds and determines as follows: a. On or about January 26, 1.977, Paradise Palace Sauna was issued an annual sauna-massage license to conduct those activities at 6708 Lyndale Avenue South. b. The licensee is a sole proprietorship owned and managed by Robert S, Higley. The sauna has operated at the location far approximately 20 months receiving its first license for the 1976 calendar year. c. The 1976 sauna License was issued to Paradise Palace Sauna after Mr. Higley gave his assurance in the form of a letter to the Richfield City Manager concerning the care he would take managing his operation and screening pros- pective employees. That letter~is attached herewith as Council Exhibit "A". The License was renewed in 1977 with the understanding that these steps would continue. d. On April 25, 1977, following a full hearing before this Council during which Mr. Higley was represented by counsel and given an opportunity to present all material and relevant evidence, this Council voted unanimously to revotce the 1977 sauna-massage license issued to Paradise Palace Sauna. e. On May 23, 1977, at the request of Paradise Palace Sauna and Robert S. Higley this Council agreed to have a rehearing. on the matter of Paradise Palace 1977 sauna-massage license. At that hearing Mr. Higley both personally and through his attorney made strong assurances to this Council that he would take the necessary steps to prevent further occurrences of the sort of conduct on the licensed premises which led the Council to revoke its license. f. After receiving Mr. Higley's strong assurances and his plea that he be allowed to continue in business, this Council passed a resolution withdrawing the revocation of the 1977 sauna-massage license issued to Paradise Palace Sauna and instead suspended that license for a period of 45 days with credit given for the two days during which the sauna was previously closed. A copy of the Council resolution is attached herewith as Council Exhibit "B". Resolution No. 5765 -2- g. On July 7, 1977, ajCity employee was given. a special undercover assignment at Paradise Palace Sauna. While at the sauna, Richard Simpson, that employee, did engage a masseuse employed by Mr,. Higley in conversation concerning the availability and cd,st of certain sexual activities. During that conversation the masseuse; later identified as Darlene Fahrney, did agree to engage in illicit sexual activites. h. On August 19, 1977, the Richfield City Manager notified rir. Higley that the 19717 massage license of Paradise Palace was to be revoked effective September 12, 1977'and further notified Mr. Higley of his order to the Richfield City Council. That letter is attached herewith as Council Exhibit ~iGer i. A request for an appeal was made by lair. Higley's attorneys and the matter came on for hearing before the Council at its regu]_ar scheduled September 12, 1977, meeting. Mr. Higley appeared and was represented at the hearing by Mr. Jack Nordbye, Esq., also present. j. The police report of the July 7, 1977, incident was offered and received into evidence at the hearing. Richard Simpson being present, was tendered to the licensee for the purpose of cross examination. A copy of the report is attached here- with as Council Exhibit "D". k. Richfield Ordinance Code Section 5.25, Subdivision 9, makes it grounds for the revocation, suspension or non-renewal of a sauna license that them has been conduct by the owners of the sauna, its managers, or agents or employees inimical to the interest of the public health, safety, welfare or morals or involving moral turpitude or employment of an employee or agent who is a person of bad repute. This Subdivision requires as a minimum that the Iicense,e, upon pain of loss of license, take all appropriate steps to, prevent the occurrence of prostitution and other immoral or i1l,egal activities upon the licensed premises. 1. The record before the Council fully establishes that on July ~7, 1977, an employee or licensee, while at work at the licensed premises offered to engage in acts of prostitution. The evidence further establishes that Robert S. Higley, the owner of Paradise Palace Sauna, has failed and continues to fail to take those steps which are necessary to prevent the occurrence of the conduct which brings this matter before 4 Resolution No. 5765 -3-- the Council and which has brought t~~is establishment's license before the Council in the past. The record further establishes that the July 7, 1977, incident was the direct result of the failure of Robert S. Higley to meet the assurances made to the City of Richfield on prior occasions ' and was furtl.~er the direct result of the failure of the owner-manager to exercise proper control and supervision over the licensed activity. 2. The 1977 sauna--massage license of Paradise Palace Sauna is therefore revoked immediately and Paradise Palace, its o~,mer, manager, agents and employees are hereby directed to inunediately cease all activities for which a sauna-~massage parlor license is required. Passed by the City Council of the City of Richfield, Minnesota, this 12th day of September,- 1977. ~- ,®%' L ~~~ ~~ .Loren L. Law Mayor ATTEST: :~G~~-1`~-' Thomas J. oran City Clerk