Could the 1720 Club, a grandfathered DC nude-dancing nightclub at 1720 H Street NW, transfer its liquor license to a new location and continue offering nude dancing under the 1994 Act?

Plain-English summary

The 1994 ABC reform statute banned nude dancing at any nightclub newly licensed after the law took effect. Existing nude-dancing clubs (operating before December 15, 1994) were grandfathered. The grandfather rule, codified at 23 DCMR § 904.6, says: "no holder of a retailer's License Class CN or DN may permit nude dancers ... provided that a licensee who regularly provided entertainment by nude dancers prior to December 15, 1994, may continue to do so at that establishment."

The 1720 Club operated under a grandfathered nude-dancing license at 1720 H Street NW. In 1998 it applied to transfer the license to a new location in the Central Business District. The ABC Board, relying on a May 1998 internal memo from the Corporation Counsel's Legal Counsel Division, accepted the application. But the Special Litigation Division of the same Corporation Counsel office had taken the opposite position one month earlier in federal court. After protestants filed a thorough motion to dismiss, the Corporation Counsel issued this 1999 formal opinion to resolve the internal split.

The conclusion: "establishment" in § 904.6 means the licensee's specific physical location on the effective date of the 1994 Act. Three factors drove the result. First, the Supreme Court and other courts have consistently read "establishment" in regulatory statutes as denoting "a distinct physical place of business" (A.H. Phillips, Inc. v. Walling, 324 U.S. 490, 496 (1945)). Eight other-jurisdiction cases collected by the protestants reinforced that line. Second, the underlying ABC Act defines each license class (nightclub, restaurant, tavern, etc.) by reference to a "suitable space in a suitable building" or similar location language; "establishment" inherits that location component. Third, the rule of statutory construction that grandfather clauses are read narrowly, not broadly, points the same direction.

The 1720 Club's transfer application therefore could not be granted. The grandfathered license died with the location. If the club wanted to operate at a new address, it would have to do so under a non-grandfathered license, which meant no nude dancing.

Currency note

This opinion was issued in 1999. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. The DC Alcoholic Beverage Control regime was substantially restructured by the Title 25 recodification (D.C. Law 13-298, 2001) and again by Title 25 amendments in 2014 and 2018; current rules on grandfathered nude-dancing licenses and license transfers should be checked against current Title 25.

Historical context

The 1994 ABC Reform Act was the legislative output of years of community organizing in the Adams Morgan, Logan Circle, and Mt. Vernon Square neighborhoods, which had pushed back against the spread of nude-dancing clubs. The Council struck a compromise: grandfather the existing operators where they sat, but freeze any expansion. The drafting of § 904.6 left a familiar ambiguity about whether the freeze followed the licensee or stayed with the building.

In April 1998 the Special Litigation Division opposed the 1720 Club's TRO motion in federal court arguing the freeze stayed with the building. In May 1998 the Legal Counsel Division (apparently unaware of the federal-court filing) issued an internal memo advising the ABC Board the freeze followed the licensee. The ABC Board acted on the May memo. The protestants then filed a 60-page motion to dismiss collecting the case law, statutory definitions, and rule-of-construction arguments that this 1999 opinion ultimately adopted.

The opinion is also a small object lesson in formal-opinion authority. Reorganization Order No. 50, Part IIA(a) provides that formal Corporation Counsel opinions are "the guiding statement of law to be followed by all District officers and employees" absent contrary action by the Council, the Mayor, or a controlling court decision. Once issued, the formal opinion bound the ABC Board and the Special Litigation Division alike, ending the internal split.

What this meant at the time for the 1720 Club

The transfer application failed. The club could not move and keep nude-dancing rights. If the operator wanted to relocate, the new location would operate under a non-grandfathered license without nude entertainment, and the H Street location would be free for a new operator under whatever license class fit the new use.

What this meant for other grandfathered nude-dancing operators

The same rule applied. Grandfathered licenses were locked to the December 15, 1994 building. A sale of the license to a new owner at the same location was a different question (sale of the going concern at the same address typically passed muster), but a move to a new building extinguished the grandfather right.

What this meant for landlords with grandfathered tenants

The grandfather right effectively belonged to the building, not the operator. That created an unusual property-and-license dynamic: a landlord could find a new operator after a tenant left, but neither party could carry the right elsewhere.

What this meant for ABC Board procedure

When two divisions of the same legal office took opposite positions on the same regulation, formal-opinion procedure was the resolution mechanism, and the result bound everyone going forward.

Common questions

Q: Did this affect bars and clubs that did not feature nude dancing?
A: No. Section 904.6 is about nude dancing only. Standard CN/DN-class licenses without nude dancing remained transferable to new locations under standard ABC Board procedures.

Q: Could the 1720 Club still sell its license to someone else who would operate at 1720 H Street?
A: The opinion did not directly address that, but the location-locked logic suggests yes: a transfer of the license to a new operator at the same address would preserve the grandfather right because the establishment's location does not change.

Q: What if the building was demolished or condemned?
A: Not addressed in this opinion. The location-tied logic suggests the grandfather right would not survive destruction of the location, but the question would need separate analysis.

Q: How did the 1948 Library of Congress rule (in the SPO opinions) compare to "establishment" here?
A: Different statutory texts but similar narrow-construction instinct. Both opinions read ambiguous language in light of legislative purpose and prior practice, and both refuse to expand a textual exception beyond its evident scope.

Citations

Statutes and regulations
- D.C. Law 10-122 (Alcoholic Beverage Control Act and Rules Reform Amendment Act of 1994)
- 23 DCMR §§ 904.5, 904.6
- D.C. Code §§ 25-101 et seq., 25-103, 25-115(b)-(c), (k)
- Juvenile Curfew Act of 1995, D.C. Law 11-48, D.C. Code § 6-2182
- DC Funeral Services Regulatory Act, D.C. Law 5-84, D.C. Code § 2-2802

Cases
- A.H. Phillips, Inc. v. Walling, 324 U.S. 490 (1945) ("'establishment' as used normally by Government and Business means 'a distinct physical place of business'")
- Siegman v. District of Columbia, 48 A.2d 764 (D.C. 1946)
- Bates v. Board of Elections and Ethics, 625 A.2d 891 (D.C. 1993)
- Morissette v. United States, 342 U.S. 246 (1952)
- USV Pharmaceutical Corp. v. Weinberger, 412 U.S. 655 (1973) (grandfather clauses narrowly construed)
- Convention Center Referendum Committee v. DC Bd. of Elections, 441 A.2d 889 (D.C. 1981)
- Page Associates v. District of Columbia, 463 A.2d 649 (D.C. 1983)
- DCX v. DC Taxicab Commission, 705 A.2d 1096 (D.C. 1998)
- Eight other-jurisdiction "establishment means location" cases listed in opinion footnote 2

Source

• Index page: https://oag.dc.gov/about-oag/our-structure-divisions/legal-counsel-division/opinions-attorney-general
• Original PDF: https://oag.dc.gov/sites/default/files/2018-02/Opinion-July-2014-1720-H-St-Liquor-License.pdf

Source

• Index page: https://oag.dc.gov/about-oag/our-structure-divisions/legal-counsel-division/opinions-attorney-general
• Original PDF: https://oag.dc.gov/sites/default/files/2018-02/Opinion-July-2014-1720-H-St-Liquor-License.pdf

License

This opinion is published by the Office of the Attorney General for the
District of Columbia. Per the DC.gov terms of use, content is licensed
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attribution.

Original opinion text

Oinuemment nf tlte Btstrtct nf C!tnlumbfu
OFFICE OF THE CORPORATION COUNSEL
JUDICIARY SQU"RE
441 FOURTH ST .. N.W.
W"SHINGTON. D. C.

20001

IN REPLY REFER TO:

Prepared by:LCD:FPM

March 11, 1999

(AL-98-243)

OPINION OF THE CORPORATION COUNSEL
SUBJECf:

1720 H Street Corporation pending application to transfer its liquor license from
1720 H Street, N.W., to a new location.

Vannie Taylor, ill, Esquire
Acting Chairperson
Alcoholic Beverage Control Board
rd
614 H Street, N.W., 3 Floor
Washington, D.C. 20001

As you know, in a May 27, 1998 memorandum to the Alcoholic Beverage Control Board
(''May 2-fi memorandum"), the Legal Counsel Division of this Office addressed whether 23
DCMR §904.6, which was enacted by the Alcoholic Beverage Control Act and Rules Reform
Amendment Act of 1994 ("1994 Act"), effective May 24, 1994, D.C. Law 10-122,41 DCR 1658,
1665 (April 1, 1994), allows a nude dancing establishment that has been "grandfathered in" to
fh
transfer its license to a new location. 1 The May 27 memorandum correctly pointed out that the
answer depends on whether the word "establishment" as used in 23 DCMR §904.6 is necessarily
tied to the location ofa licensee's business when the 1994 Act was adopted, or instead reasonably
may be more broadly construed to mean a licensee's business wherever located at any particular
time - not necessarily tied to the location in 1994. Without addressing whether the application
should be gJ:allted, the Legal Counsel Division's memorandum opted for the broader meaning of
"establishment" and, thus, it concluded that the ABC Board could lawfully consider the application
of the 1720 H Street Corporation tJa 1720 Club (the "1720 Club',) to transfer its class "eN" liquor
1 23 DCMR §904.6 provides:

After the effective act of the Alcohol Beverage Control Act and Rules Reform Amendment
Act of 1994, no holder of a retailer's License Class CN or DN may pennit nude dancers
pursuant to section 904.5 of this Section, provided that a licensee who regularly provided
entertainment by nude dancers prior to December 15, 1994, may continue to do so at that
establishment. (Emphasis added.)

license from 1720 H Street, N. W., to a new location in the Central Business District.
th

In reliance on the May 27 memorandum, the ABC Board accepted the 1720 H Street
Corporation's application to transfer its license to a new location. One month earlier, the Special
Litigation Division of this Office, in a brief filed in U.S. District Court opposing the 1720 Club's
Motion for a Temporary Restraining Order, had taken the opposite view and construed
"establishment" in 23 DCMR §904.6 to mean actual address or physical building in which a
bUsiness is located. I understand that the Legal Counsel Division was unaware of the Special
th
Litigation Division's brief when it issued the May 27 memorandum. Thereafter, the Board held a
protest hearing intermittently between November 4, 1998 and January 27, 1999 on the Protestants'
opposition to the 1720 Club application. On January 20, 1999, the Protestants filed an extensive,
well-researched Motion to Dismiss the 1720 Club application on the ground that a grandfathered
licensee's "establishment" in 23 DCMR §904.6 meant the business at its particular location when
the 1994 Act took effect. The ABC Board now must rule on that motion.
In light of these previous conflictiDg views by two divisions of this Office - a conflict of
which I was not aware until recently - I am now addressing what "establishment" means under 23
DCMR §904.6 as a formal opinion pursuant to Part (A)(a) of Reorganization Plan No. 50 Office of Corporation Counsel (June 26, 1953) as amended. See also United States Parole
Commission v. Noble, 693 A.2d 1084, 1098 (D.C. 1997), affinned on rehearing en banc, 711 A.2d
85 (D.C. 1998).

n

CONCLUSIONS
The phrase, "at that establishment," in 23 DCMR §904.6 is ambiguous. On the one hand. il
may be narrowly construed to mean only a grandfathered licensee's place of business at the time
that the 1994 Act took effect. Indeed, under the rule of construction that no statutory provision
should be rendered superfluous, there is a good argument that the phrase "at that establishment"
must refer to a specific location when the 1994 Act took effect because there would have been no
need for this phrase - i.e., 23 DCMR. §904.6 could have ended with the phrase "may continue to do
so" - if the Council had intended to permit a licensee to operate an ABC-licensed nude dancing
business in a new location at a later date. Notwithstanding this point, I believe that "at that
establishment" also can reasonably be construed to mean a licensee's business wherever located at
any particular time, including any new place approved by the ABC Board pursuant to its
longstanding license transfer procedures. Under this view, the broader construction of the
grandfather p,rovision could give a reasonable meaning to "at that establishment." Under that
meaning, the phrase could be construed to limit the effect of the grandfather clause to a licensee's
nude dancing business on the effective date of the 1994 Act, and yet would preclude that licensee
from commencing nude dancing at any other ABC-licensed business it owned that did not already
feature nude dancing when the 1994 Act took effect.
!

But for this possibility that a licensee might be conducting several businesses, I would not
hesitate to conclude that the last words of23 DCMR §904.6, supra note 1, would have to be
construed to limit continuation of the nude dancing to a particular location. Given, however, this
multiple business possibility - so that there arguably was a need to make clear that a given licensee
was grandfathered only for those licensed businesses where nude dancing was already being

2

conducted in 1994 - the ambiguity persists as to what "at that establislunent" means. In adopting
23 DCMR §904.6, the Council could have - but did not - clarify this point in the language it used.
For example, if it intended to limit a grandfathered license to the place of business in 1994, it could
have made the intent clearer through the addition of a phrase like ''where located on the effective
date of [the 1994 Act]." The legislative history of the 1994 Act slightly supports the broader
interpretation of "establishment" in 23 DCMR. §904.6, while the legislative history of the related
provision in 23 DCMR §904.5 (adopted in 1986) slightly supports the narrower interpretationoverall, a wash. Similarly, hypothetical substitutions of "business" or "place of business" for
"establishment" in 23 DCMR §904.6 and the underlying District of Columbia Alcoholic Beverage
Control Act ("ABC Act"), approved January 24, 1934,48 Stat. 319, D.C. Code §25-10l ~
(1996), in order to see which fits better, yield no definitive answer because both substitutions
generally work reasonably well.
However, based on our evaluation of the Protestants' Motion to Dismiss, the Applicant's
response, and our own extensive research, I am convinced that three interpretive factors - which
th
the Legal Counsel Division did not consider when the May 27 memorandum was issued - weigh
decisively in favor of the conclusion that "establishment" should be narrowly construed to mean a
grandfathered licensee's place of business at the time the 1994 Act took effect. First, the courts'
developed jurisprudence on the meaning of "establishment" shows that this term normally involves
a location criterion. Second, the establishments covered by the Class "eN' and "DN" designations
in the ABC Act and Regulations ~ restaurants and nightclubs) are, in turn, defined in the ABC
Act in a way that includes location criteria Third, the general rule of statutorY construction is that a
grandfather clause, as in 23 DCMR §904.6, is to be narrowly - not broadly - construed. Given
these factors, it is unlikely that a reviewing court would give deference to any ABC decision to
adopt the alternative broader construction of "at that establishment." See, ~ DCX v. District 01
Columbia Taxicab Commission. 705 A2d 1096, 1098 (D.C. 1998). Thus, I conclude that the ABC
Board lacks the authority to grant a nude dancing establishment's application to transfer its license
to a new location. Without such authority, the Board has no power to grant a transfer of the 1720
Club's license to a new location and, consequently, the Protestants' Motion to Dismiss should be
granted.
ANALYSIS

I. Defming the Phrase "at that establishment"
A. Plain Meaning Rule
When a regulation does not provide a definition, the courts will attribute to a term its
natural, plain, and ordinary meaning. See Riggs National Bank v. District of Columbi~ 581 A.2d
1229, 1235 (D.C. 1990). In this case, the Council of the District of Columbia did not defme the
term "establishment" in 23 DCMR §904.6. Thus, we have to apply the plain and common meaning
of this word. Dictionaries provide a useful starting point for determining what statutory terms
mean, by suggesting what the legislature could have meant by using particular terms. See 2A
Sutherland. StatutOry· Construction [hereinafter ''2A Sutherland"] § 47.28 (N. Singer
ed.
1992). Based on several dictionaries' definitions - including Webster's Third New International
Dictionary (1981), Black's Law Dictionary (1990), The American Heritage Dictionary (1985),

Slli"

3

Webster's New World Dictionary (1972), and the Webster's Ninth New Collegiate Dictionary
(1985) - I conclude that "establishment" has two applicable meanings. First, "establishment" can
mean "a place of business or residence with its furnishings and staff" Second, it can mean "a civil
organization" or "a public or private institution" without location criteria Thus, the definition of
the word "establishment" taken by itself, based on these dictionaries, is not determinative, making
the meaning of "establishment" ambiguous. The same conclusion is reached with respect to the
phrase, "at that establishment," in 23 DCMR §904.6.
B. Legal meaning
Absent legislative intent to the contrary, or other evidence of a different meaning, legal
terms in a statute may be construed as having been used in their le~ - as contrasted with their
plain - sense. 2A Sutherland, at § 47.29. Black's Law Dictionary (6 ed. 1990), page 546, defines
"establishment" to mean "[a]n institution or place of business, with its fixtures and organized staff"
(Emphasis added.) In addition, to support this definition, Black's Law Dictionary cites Abnie v.
Ford Motor Co. 195 N.E.2d 131, 135 (Ohio COm.P1.l961), where the Court of Common Pleas of
Ohio noted that "several C8$CS of the Supreme Court of Ohio are cited to us which indicate the
Supreme Court bas defined 'establishment' as being a place where the business or operation is
carried on." If the word "establishment" in the law nonnally includes a location criterion, and if
"establishment" in 23 DCMR §904.6 is given its legal meaning - an approach that, while not
necessarily required, is nonethelesS reasonable - then it follows that "at that establishment" in 23
DCMR §904.6 narrowly refers to a grandfathered licensee's place of business when the 1994 Act
took effect.
Aside from Black's Law Dictionary, the courts' developed jurisprudence supports the
conclusion that the normal legal m<";Joing of "establishment" is a "place of business." Even though
not binding, a reviewing court would be likely to find that the Council was aware of these judicial
decisions when it adopted 23 DCMR §904.6. See Bates v. Board of Elections and Ethics, 625 A2d.
891, 893 (D.C. 1993Xciting Morissette v. United States, 342 U.S. 246, 263 (1952), for the
proposition that "where Congress borrows terms of art in which are accwnulated the legal tradition
and centuries of practice, it presumably knows and adopts the cluster of ideas that were attached to
each borrowed word in the body of learning from which it was taken.''). The most significant
decision we have found defining "establishment" is A.H. Phillips. Inc. v. Walling, 324 U.S. 490
(1945). There, the U.S. Supreme Court stated, "'establishment' as used nonnally by Government
and Business means "a .aistinct physical place of business". Id. at 496. (Emphasis added.) The
Court went <?n to say that, "census reports, business analyses, administrative regulations, and state
taxing and regulatory statutes interpret establishment in this way." Id.
In the present case, the Protestants submitted in their Motion to Dismiss eight examples
from other jurisdictions where the word "establishment" is defined to include a specific place?
2 These are: (1) Town of Foxborough v. Bay State Harness Horse Racing & Breeding Ass'n. Inc.,

366 N.E.2d 777,5 Mass. App. 613, 617 (1977) (establishment is defined as a more or less fixed
and usually sizable place of business together with all of the things that are an essential part of
it); (2)Claims of Ffalco Ward, 514 N.Y.S.2d 568,569 (1987) (airport terminal building was part
of an establishment); (3)Abnne v. Dept. of Labor, 489 P.2d 1397, 1401,53 Haw. 185 (1971)
4

Several of these cases cite to the Supreme Court's decision in A.H. Phillips. supm, in reaching
their determination that "establishment" means a distinct physical place in administrative
regulations. No decisions to the contrary were cited in the Applicant's opposition to the Motion to
Dismiss; nor have we found any decisions to the contrary. The decisions cited in the preceding
footnote are significant because the D.C. Court of Appeals, in interpreting a term in a local statute,
will give weight to the interpretation that another court has given to the identical term in a different
statute. For example, in Bates v. Board of Elections and Ethics, 625 A.2d 891 (D.C. 1993), the
Court of Appeals stated that its ''reading of the statute produced a result that was consistent with the
overwhelming majority view in American jurisdictions." Additionally, the Court of Appeals in
Siegman v. District of Columbi~ 48 A.2d 764, 766 (D.C. 1946), interpreted a "business
establishment" to imply a particular location when, with regard to the specific language used in a
regulation by the former Board of Commissioners, the Court stated:
Had the Commissioners, instead of using the word 'location', said 'street address' or
'business establishment' or 'premises', or such similar term, it is obvious that such
language would have included department stores and markets occupying all or most of a
city block ... [w]e conclude that the use of the general term 'location' is sufficiently
definite to have informed defendant of the nature of the offense and how to avoid
violations .... (Emphasis added.)
There is further support in the District's statutory law for the proposition that
"establishinent" means a "place of business." The Protestants submitted examples of the use of
the word "establishment" to include the concept of location in D.C. business and tax law. In
addition to the examples given by the Protestants, section 3 of the fonner Juvenile Curfew Act of
1995, effective September 20, 1995, D.C. Law 11-48, D.C. Code §6-2182 (1998 Supp.), defined
"establishment" to mean "any privately owned place of business operated for a profit to which the
public is invited, including, but not limited to, any place of amusement or entertainment"
(Emphasis added.)
Also, under section 3 of the District of Columbia Funeral Services
Regulatory Act of 1984, effective May 22, 1984, D.C. Law 5-84, D.C. Code §2-2802 (1994),
"funeral services establishment" is defined to mean "any place or premises in the District devoted
to, or wherein is engaged, the business of the care or preparation of human remains for funeral
burial ...." (Emphasis added.)

(establishment within the unemployment statute naturally means a building or group of
proximate bUildings); (4) Snook v. International Harvester Co., 276 S.W.2d 658, 660 (Ky. 1955)
(establishment under unemployment compensation statute is particularly characterized by a fixed
geographic location; (5)Auxier-Scott Supply Co. v. Oklahoma Tax Commission, 527 P.2d 159,
162 (Okla. 1974) (under statute extending sales tax exemption, establishment means any location
or place where business conducted); (6) Marshall v. New Hampshire Jockey Club. Inc., 562 F. 2d
1323, 1329 (1 st Cir. 1977)(an "establishment" within Fair Labor Standards Act ("FLSA") means
a distinct physical place of business); (7) Usery v. Mother Hubbard's Kitchen Inc., 549 F.2d 566,
th
567 (8 Cir. 1977)(under retail establishment exemption ofFLSA, establishment means a
distinct physical place of business); (8) Abnie v. Ford Motor Co., 195 N.E.2d 131, 135 (Ohio
Com.PI. 1961) (an establishment is a place where one is pennanently fixed for residence or
business).
5

Moreover, under the ABC Act and the implementing regulations, restaurants, nightclubs,
taverns, etc., are all considered to be "establishments." See e~g., D.C. Code §25-I03 ("no
licensed establishment other than a nightclub or a legitimate theater may provide entertainment
by nude performers.") And, the statutory definition of each of these establishments, - i.e.,
restaurants, legitimate theaters and nightclubs, - refers to a location criterion. 3 Because each of
the establishments covered under ABC law is defined by reference to a location criterion, it
follows that lIestablishmentll as used in ABC law -- including 23 DCMR §904.6 -- must by
definition contain location in its definition. Therefore, it is likely that, in reviewing any appeal
under 23 DCMR §904.6, the D.C. Court of Appeals would conclude that "at that establishment"
denotes the specific location of a grandfathered licensee's business when the 1994 Act was
adopted and, consequently, would hold that the ABC Board has no authority to approve the 1720
Club's application for transfer to a new location.

C. Grandfather clauses are narrowly construed
As a general principle of statutory interpretation, a grandfather clause exception is to be
construed strictly against the one who invokes it In addition as noted by the U.S. Supreme Court
in USV Pharmaceutical Corp. v. Weinberger, 412 U.S. 655, 666 (1973), a "grandfather clause may
not be construed so as to provide a loophole." While it has not expressly adopted these rules of
statutory construction, the D.C. Court of Appeals appears to have tacitly adopted them because it
has not looked favorably upon broad interpretations of grandfather clauses. See Convention Center
Referendum Committee v. District of Columbia Bd. of Elections and Ethics, 441 A2d. 889,900
(D.C. 1981Xen bancXnoting, with regard to" the Convention Center Referendum Committee
("CCRC"), that the CCRe's grandfather clause did not give the Board of Elections and Ethics or
the CCRC ''the power to revise the substance of CCRC's initiative after petitions have been
circulated',). It appears that the D.C. Court of Appeals will read a grandfather clause only as
broadly as necessary to give it some meaningful effect. See e.g., Page Associates v. District of
Columbia. 463 A.2d 649, 655 (D.C. 1983Xrejecting the D.C. Board of Zoning Adjustment's
interpretation of a grandfather clause as being so restrictive "as to undermine the rationale of the
grandfathering .provision). Here, 23 DCMR §904.6 has banned nude dancing except for those
entitieS specifically "grandfathered in." Absent express language, no exceptions should be read
into this regulation beyond those minimally necessary to give effect to the regulation's grandfather
clause. Thus, the 1720 Club should not be allowed to transfer to a new location because to do so
3 Under D.C. Code §25-103, the nightclub definition includes "a suitable space in a suitable

building, approved by the board"; the brew pub definition includes "a suitable place"; the
restaurant definition includes "a suitable space in a suitable building"; the tavern definition
includes "a suitable space in a suitable building"; the "hotel" definition includes "a suitable
building or other structure"; and the club definition includes "a corporation ... owning, hiring or
leasing a building or space in a building of such extent and character as in the judgment of the
Board may be suitable ...."
4 See United States v. Allan Drug Corp .• 357 F.2d 713, 718 (lOth Cir. 1966); Durovic v.

Richardson, 479 F.2d 242, 250 (7ih Cir. 1973); See National Association of Casualty and Surety
Agents v. Bd. of Governors, 856 F. 2d 282, 286 (D.C. Cir. 1988); 73 Am. Jur. 2d, Sta~tes §313
(1974).
6

would be to read under the applicable rule of statut6ry construction, an unnecessarily broad
exception into 23 DCMR §904.6.
.

D. Other factors
Other factors relevant to the interpretation of23 DCMR §904.6, i.e., the written
legislative history of the 1994 Act and the hypothetical alternative substitution of "business" or
"place of business" for "establishment" in the ABC Act and 23 DCMR §904.6 to see which fits
better, add little to the foregoing analysis and, therefore, do not change my conclusion that the
grandfather clause in 23 DCMR §904.6 should be narrowly construed to permit nude dancing
only at the locations where ABC-licensed businesses were operating when the 1994 Act took
effect.
With respect to legislative history, the committee report accompanying the 1994 Act
stated that the purpose of the amendment to Section 904 in 23 DCMR was to provide that, ''no
newly-licensed ABC establishments may feature nude daricing," and that "existing
establishments are grandfathered in." See Report of the Committee on Consumer and Regulatory
Affairs for Bill 10-207, the "Alcoholic Beverage Control Act and Rules Reform Amendment Act
of 1993," dated December 15, 1993. This statement reasonably may be interpreted to show that
the Council's purpose was to limit the number of licenses featuring nude dancing, and not to
restrict the transfer of those licenses, especially where the licenses were located in the Cen~
Business District. However, the legislative history of related 23 DCMR §904.5, which was
adopted in 1986, states that "[t]he intent is to restrict nude dancing at licensed nightclubs to the
Central Business district, gradually phasing it out at establishments elsewhere in the District as
ownership changes occur." See Report of the Committee on Consumer and Regulatory Affairs
for Bill 6-504, the "District of Columbia Alcoholic Beverage Control Act Reform Amendment
Act of 1986," dated November 12, 1986, at page 57. Thus, the intent of the Council under the
1986 Act was not simply to restrict the number of licenses, but mther only to allow existing nude
dance clubs to remain at their current locations - and then only as long as their ownerships
remained the same. Thus, the relevant legislative history is inconclusive concef!1ing which of the
s
alternative plausible definitions of "establishment" the Council intended to use.
th

According to the Legal Counsel Division's May 27 memorandum, a comparison of the
substance of23 DCMR §904.6 with other portions of the 1994 Act where the word
"establishment" is used itidicates that the word was not intended to· include the concept of a
S In their Motion to Dismiss, the Protestants attempt to show that the broader interpretation of the .

phrase "at that establishment," is incorrect based on a letter dated December 29, 1998 from Mr.
John Ray to the ABC Board. Mr. Ray is the former Chairman of the Council's Consumer
Regulatory Affairs Committee and was responsible for drafting the 1994 Act. Mr. Ray's letter
indicates that, in the 1994 Act, the Council did not intend to authorize the ABC Board to
consider a location transfer application if the licensee proposed to offer nude entertainment at the
new location. It should be noted, however, that Mr. Ray's December 29, 1998 letter is not part of
the legislative history of the 1994 Act and cannot be considered to determine the Council's intent
when it passed the 1994 Act. See~, Riggs National Bank of Washington v. District of
Columbi~ 581 A.2d 1229, 1236 (D.C. 1990).
7

specific location -- i.e., a geographical place -- and that the Council used the word "location"
whenever it intended this concept. In support of this proposition -- and the key to its conclusion
th
- the May 27 memorandum lists examples in the 1994 Act where the use of the words
"establishment" and "location" clearly are not intended to overlap; rather, "location" is used to
refer to a specific place, whereas "establishment" is used to refer generally to a "business." I
agree with the conclusion that the word "business" is a better fit than the word "location" when
substituted for the word "establishment" in the various examples cited in the May 27th
th
memorandum. However, for the May 27 memorandum to be correct in its interpretation of the
Council's intent, the word "business" also must be a better fit than the phrase "place of
business." After an extensive analysis by my staff, involving the insertion of the phrase "place of
business" for "establishment" throughout the ABC Act and the implementing regulations, it is
apparent that the phrase "place of business" is as good a fit as, if not a more apgropriate fit than,
the word "business.,,6 Consequently, the substitutional analysis in the May 27 memorandum
. has no impact on the conclusion described earlier that "establishment" in 23 DCMR §904.6 must
be narrowly construed to mean only a grandfathered licensee's place of business at the time the
1994 Act took effect.
Sincerely,

th

, This analysis included the three examples from the 1994 Act that are cited in the May 27
memorandum. For example, section 2(£)(2) of the Rules Amendment Act amended section 14(b)
of the ABC Act, D.C. Code 25-115(b), to add a new paragraph 5 which reads:
CN-licensed establishments to be located in a nightclub district shall be presumed to be
appropriate for such location. (Emphasis added.)
Replacing this phrase with "CN-licensed places of business to be located in a nightclub district ..
. , instead of "CN-licensed businesses to be located in a nightclub district", provides an equal or
better fit within the context of the language. I reach the same conclusion regarding: section
2(£)(3) of the 1994 Act, which amended section 14(c)(2), D.C. Code 25-115(c)(2), to add a new
phrase which reads "Except that in the case of establishments to be located in a nightclub district
the Board shall post the notice for at least 20 calendar days prior to the hearing." (emphasis
added); ·and section 2 (f)(5) of the 1994 Act, which amended section 14, D.C. Code §25-115, to
add a new subsection (k) that now reads in part "no existing license class CN, CT, DN, or DT
shall be transferred to any other person or to any other location within the Georgetown historic
district, except when the number of such licensed establishments in the Georgetown historic
r
district is below 6." (Emphasis added.)
8

cc: Anthony A. Williams
Mayor
Paul E. Waters
ABC Program Manager

9