Suit Aimed at Rhythm Cafe Lease : Concerts: Owner of the building that houses the Santa Ana club seeks to permanently oust the struggling rock promoters over mounting debts.
As the debt-ridden Rhythm Cafe scrambles for a new lease on life, its landlord is trying to revoke the club’s lease by month’s end and put it out of business for good.
The concert-and-dinner club closed last March when its key financier, developer Curt Olson of Newport Beach, backed away in the face of mounting losses. Michael Feder, the partner who was in charge of day-to-day operations, opened the Cafe’s doors again last month for two well-attended hard-rock concerts. Outside promoters rented the venue and ran the shows.
At the time, Feder said he was putting together new financial backing to reopen the spacious, lavishly appointed Cafe on an ongoing basis.
The alternative-rock promoter Goldenvoice is selling tickets for a Jan. 27 concert at the Cafe by the Mighty Mighty Bosstones and Suburban Rhythm.
But Santa Ana Harbor Real Estate, the Los Angeles company that owns the Cafe building at 3503 S. Harbor Blvd., is seeking to oust the Cafe’s parent corporation, Musicsphere Entertainment.
In papers filed in November in Orange County Superior Court, the landlord claimed that Musicsphere owed $43,750 in back rent, with additional rent debts mounting at the rate of $279 per day. The court papers also allege that Musicsphere violated its lease when the Cafe left bills unpaid, prompting creditors to file liens on the property.
“We are evicting Musicsphere. We do not want them as a tenant,” Barrett W. McInerney, the landlord’s attorney, said last week. “As far as we know at this point, Musicsphere doesn’t have two nickels to rub together, so we would just like to make them homeless. My clients want to make sure they have a viable tenant in there.”
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McInerney said he expects the bid to oust Musicsphere to go to trial within two weeks.
Feder, however, says he has lined up investors interested in backing a revived Cafe.
“I think the differences between the landlord and I will be resolved. He’ll get his money, and we’ll reopen,” Feder said Friday. “The landlord and I are in direct communication. If we work out concessions I asked for, they’ll get the money and I’ll be there.”
That, McInerney said in an exasperated tone, “is the same thing we’ve been told for six months. We’ve heard he’s coming up with investors, but no one has seen a penny. Even more so than the rent, there’s an issue of trust. They can’t tell you one thing and have it keep evaporating.”
McInerney said he has received calls from prospective new investors in the club, but when he outlines the extent of the Rhythm Cafe’s legal and financial problems, “You can listen to the interest level on the other end of the phone deflating, and that’s the last you hear from anyone.”
“That’s not accurate,” Feder countered. “Any investors I’ve been speaking with have not spoken to Barrett McInerney. I’ve disclosed exactly the position I’m in to the investors, and they’re aware of it.”
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Though hopeful, Feder said he has not yet raised enough money to put a revived Cafe on secure footing. He said that would take about $450,000, and that he now has investor backing totaling about $250,000.
Besides its lease problems, Musicsphere is being sued by Calva Construction Co. of Ontario for $74,700. Calva, which since has filed for Chapter 7 bankruptcy according to court records, says that the money is owed on a $227,000 remodeling project it carried out before the Cafe’s opening in October, 1992. Calva has in turn been sued by creditors who sold it supplies for the Rhythm Cafe project. Also, National Commercial Recovery Inc., a collection agency, has sued Musicsphere for $32,000 to collect on a debt owed to The Los Angeles Times.
When it opened, the Rhythm Cafe appeared to pose a serious, well-financed challenge to the Coach House in San Juan Capistrano, which for the past eight years has been Orange County’s only full-time club for touring pop attractions.
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While it succeeded in booking such major acts as Los Lobos, B.B. King, the Neville Brothers and Social Distortion, the Cafe folded after less than five months.
The Rhythm Cafe was Feder’s brainchild, part of an ambitious plan to establish a string of concert-and-dinner clubs across the United States. A sister club, also called the Rhythm Cafe, opened in San Diego the same night as the flagship Santa Ana club debuted, but its run was even shorter.
“I didn’t build the place to see it fall apart,” Feder said in an interview about six weeks ago as he spoke of his attempts to revive the Rhythm Cafe with new investors.
“I pray to God I can get it back open. If the place can be saved, then great. If it can’t, I wasted another six months.”
