Opinion ID: 2095108
Heading Depth: 2
Heading Rank: 2

Heading: Authority of the Board under Article 2B

Text: Petitioner states that through Article 2B, § 10-405, entitled Nudity and sexual displays, the legislature has directed that certain counties, not including Prince George's County, shall revoke an establishment's liquor license if, after a hearing, any certain enumerated adult entertainment activities are found to have taken place on the premises. [11] Petitioner argues that Prince George's County's absence from § 10-405 is proof that the Board cannot regulate any specific form of entertainment offered at any licensed establishment. The absence of Prince George's County as a jurisdiction covered by § 10-405 does not, as petitioner contends, deprive the Board of any power to regulate an alteration in the mode of operation of a licensed establishment. Rather, it means only that in Prince George's County, unlike in those counties named in § 10-405, the revocation of a liquor license is not the required consequence of the presentation of adult entertainment as described in § 10-405. In Coalition for Open Doors v. Annapolis Lodge, 333 Md. 359, 635 A.2d 412 (1994), we stated that a somewhat similar type (it did not involve adult entertainment) of state exemption `amounts to no regulation at all and accordingly leaves the field open for regulation at the local level.' Id. at 381, 635 A.2d at 423 (quoting City of Baltimore v. Sitnick, 254 Md. 303, 324, 255 A.2d 376, 385-86 (1969)). The facts in Annapolis Lodge involved an ordinance enacted by the City of Annapolis requiring a private club applicant for a liquor license to complete an affidavit stating that it does not discriminate in its membership practices. A private club argued that such an ordinance conflicted with the state public accommodations law, which exempted private clubs from its application. This Court stated, however, that the state public accommodations law does not permit discrimination by private clubs. It simply excludes private clubs from the coverage of the state law, and held that there was no conflict between the local ordinance and the state legislation. Annapolis Lodge, 333 Md. at 383, 635 A.2d at 423. In the case sub judice, § 10-405 does not permit adult entertainment to occur unfettered in Prince George's County. It simply excludes licensed establishments that offer certain types of adult entertainment in Prince George's County from having their liquor licenses automatically revoked. The action of the Board in fining petitioner $5,000 for his violation of Board Rule 37(D) was entirely within the legal authority of the Board. In Board of Liquor License Commissioners for Baltimore City v. Hollywood Productions, Inc., 344 Md. 2, 684 A.2d 837 (1996), this Court explained that Article 2B confers on all liquor boards the power to, in appropriate circumstances, sanction a licensee's noncompliance with Article 2B. These sanctions, in general, are: monetary fines, license suspension, and license revocation. See Hollywood Productions, 344 Md. at 15, 684 A.2d at 844. We further stated that certain local liquor boards are expressly granted additional sanction powers and enforcement tools and that the elaborate statutory scheme suggests a specific, rather than broad, delegation of authority to the liquor boards and contradicts the notion that restrictions, penalties, and sanctions may be fashioned on an ad hoc basis. Id. at 16, 684 A.2d at 844 (noting that an exception exists, however, where the licensee consents and agrees to a reasonable restriction). Section 16-507 of Article 2B discusses the Local penalties allowed for violations of the article. Section 16-507(r), which applies to Prince George's County, established at the time of petitioner's violation that: In Prince George's County the Board of License Commissioners may impose a fine of not more than $5,000 in lieu of or in addition to suspension or revocation of a license for any violation that is cause for suspension or revocation under the alcoholic beverage laws affecting Prince George's County. [12] [Footnote added.] As we discussed, supra, the fact that petitioner began offering adult entertainment at his establishment, thereby altering the use of the premises, without first obtaining Board approval, as required by Board Rule 37(D), was a direct violation of not only Board Rule 37(D), but also of the local rule's enabling statute, § 8-217(a)(4) of Article 2B. Petitioner's action of continuing to provide adult entertainment on the premises after being notified that he was in violation of Board rules also evidences an intent by petitioner purposefully to ignore the authority of the Board. [13] As mentioned, under § 16-507(r) of Article 2B, violations like those of petitioner can result in a fine of not more than $5,000, in lieu of, or in addition to suspension or revocation. The Board's action in fining petitioner $5,000.00 was therefore an authorized sanction under the State statutory scheme. We agree with the Court of Special Appeals' conclusion in the present case that the Board, providing it does so in a proper manner, would have the power in appropriate circumstances to fine, suspend and/or revoke a license, thus subjecting an operator to fines, criminal penalties and ultimately the injunctive powers of the courts. Petitioner was fined for his violation of Board Rule 37(D). Petitioner's license to keep and sell alcohol at the Lanham Inn premises was contingent upon his not substantially altering the mode of operation of the premises. The Board, within its discretion, found that petitioner had significantly altered the mode of operation of the premises without first obtaining Board approval by introducing adult entertainment in the form of topless dancing at the Lanham Inn. This constituted a violation of Board Rule 37(D), which was promulgated pursuant to § 8-217(a)(4) of Article 2B. [14]