ROXBURY, NJ – The owners of the shuttered Smiles II go-go bar in Ledgewood are in jeopardy of losing their embattled liquor license, according to township officials.
The establishment, at the intersection of Route 46 and Route 10 in Ledgewood, has been closed since July 2016 when its owners and some employees were arrested on multiple criminal charges including racketeering, money laundering, conspiracy, theft and credit card theft.
The defendants, including owners Kevin and Shelly Lipka, were indicted last summer. The bar has remained closed but its owners have been fighting to keep intact its liquor license.
“Roxbury did not renew their license because of a whole bunch of deficiencies,” said Roxbury Township Counsel Anthony Bucco. “It’s been ongoing for well over a couple of years.”
Establishments selling alcohol must renew their liquor license every year. In Roxbury, the renewals are handled by Roxbury Township Clerk Amy Rhead.
Among the requirements for getting a renewal is proof from the state that all taxes are up to date, Bucco said.
“There was an issue whether he (Lipka) obtained that tax clearance,” he said. “So every time he would come in to try to renew the license, Amy had to deny it because all the paperwork wasn’t in order.”
Throughout, Lipka “kept saying, ‘I have everything,’” Bucco said. He said the former dentist, a Livingston resident, hired a lawyer who eventually filed an appeal of Roxbury’s refusal to act on the license.
No Tax Clearance, No License
Rhead said she last issued a license to the bar for 2015-2016.
“In 2016-2017, I did not,” she said. “All we get is a notification that there’s a tax clearance issue. It could be a form is missing. It could be anything. It’s from the New Jersey Division of Taxation’s regional office. They just say you have to (contact) the licensee and tell them to call the division. If you don’t get tax clearance you can’t issue the license.”
When time came for the 2017-2018 license renewal, the same thing took place Rhead said: “No tax clearance.”
However, she said the taxation division then issued the tax clearances but added a contingency stipulating that the license be transferred to a different entity, going from She Kev Inc. to She Kev LLC all at once.
“That was a contingency of the Division of Taxation, so I needed a transfer application,” Rhead said. “By time he (Lipka) gave me the transfer application … another term for the liquor license came up.”
She said Lipka “delivered the final missing piece to transfer the application” on June 19, 2018, right before the 2018-2019 license term began. “He brought the documents in but came back a half-hour later and gave me a copy of his appeal to the state about me not acting on his license.”
Liquor license rejection appeals are handled by a state Office of Administrative Law (OAL) judge. Because Bucco is also a member of the state Assembly, he had to recuse himself from representing Roxbury in that appeal, he said.
The township hired a special counsel to handle the matter.
“From the township’s perspective, this really didn’t matter,” Bucco said. “They pay me on an hourly basis for the work I do for the township, so – instead of paying me – they are paying an outside council (for the Smiles II case).”
Lawyer Jumps Ship
The outside counsel began work on the case but didn’t get far, according to Bucco.
“Recently, the lawyer called me and told me that the lawyer representing Smiles sent a letter to the court asking to be relieved as counsel,” he said. “The judge made a decision to allow the attorney to withdraw, so everything came to a standstill.”
Bucco said Lipka cannot proceed without a lawyer because the license is a corporate entity.
“Right now, the case is I limbo and can’t go anywhere until such time as they hire a new lawyer,” Bucco said. “It may be that they just abandon the case. At some point, the judge will say, ‘You either have to prosecute your case or I’m going to dismiss.’ As of right now, the liquor license has not been renewed.”
Smiles’ liquor license was suspended temporarily in 2016 by the state Alcoholic Beverage Commission due to charges of “lewdness or immoral activity” that were observed by investigators. The bar stayed open and, since it was no longer selling alcohol, tried marketing itself to those 18 and older.
A record of those infractions remain on the license, possibly making sale of the otherwise valuable asset difficult because any subsequent violations might result in license revocation.
Meanwhile, the township issued two property maintenance summonses on Oct. 9, according to Roxbury Township Manager John Shepherd. He said these relate to “an abandoned car in the rear of the lot and … failure to register the property” as a vacant building.
A municipal court date on summonses was set for Jan. 31, Shepherd said.
Lipka could not be reached for comment.
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