Parent company Rick's Cabaret International, Inc. not liable on employment status of entertainers at its New York City club; will appeal ruling against subsidiary
NEW YORK CITY – (September 10, 2013) – Rick’s Cabaret International, Inc. (NasdaqGM:RICK), the publicly traded hospitality company whose subsidiaries own more than 40 gentlemen’s clubs and restaurant venues nationwide, said today it was pleased a federal judge did not find the parent company liable in a ruling that maintains entertainers who filed a class action suit should be treated as employees.
The ruling was handed down today by federal judge Paul A. Engelmayer of the Southern District of New York and addressed a lawsuit brought by several former dancers at the club against Peregrine Enterprises, the subsidiary that operates the New York City club, and the Houston-based parent company. The ruling denied the dancers’ attempt to hold the parent company liable.
Eric Langan, president and CEO of Rick’s Cabaret International, Inc. said: “In practice, this ruling has no impact on the operations of Rick's Cabaret New York City since we changed our independent contractor practices some time ago and the court denied the plaintiffs’ attempts to hold the parent company liable. Nonetheless, we are disappointed with the ruling and intend to appeal. It is hard to imagine how these entertainers should be paid at the minimum wage, which would amount to a fraction of the $1,000 or more that some of them acknowledged they earned in a single night. Additionally, the court did not rule on the issue of whether the substantial amounts entertainers earned are wages under New York State Labor Law.”
The attorney representing Rick’s Cabaret International and Peregrine, Jeffrey A. Kimmel of the firm of Meister Seelig & Fein LLP, said: “We disagree with the decision and intend to appeal. Additionally there are significant remaining issues that were not addressed on these motions, including whether the substantial amounts earned by the plaintiffs can be deemed wages under New York State Law and therefore be applied against any claimed minimum wage obligations. Based on recent developments in the law we also intend to move the court to decertify the class and we are optimistic that the class will be decertified.”
About Rick’s Cabaret: Rick’s Cabaret International, Inc. (NASDAQ: RICK) is home to upscale adult nightclubs serving primarily businessmen and professionals that offer live entertainment, dining and bar operations. Nightclubs in New York City, Miami, Philadelphia, Charlotte, Dallas/Ft. Worth, Houston, Minneapolis, Indianapolis and other cities are named "Rick's Cabaret," "XTC," “Club Onyx” and “Tootsie’s Cabaret” and other brand names. Sexual contact is not permitted at any locations. Rick’s Cabaret also operates a media division, ED Publications. Rick’s Cabaret common stock is traded on NASDAQ under the symbol RICK. For further information contact [email protected] or visit www.ricksinvestor.com. Facebook: http://www.facebook.com/rickscabaretintl.
Forward-looking Statements: This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company’s actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company’s businesses, risks and uncertainties related to the operational and financial results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. Rick's has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances. For further information visit www.ricksinvestor.com.
Contact: Allan Priaulx, 212-338-0050, [email protected]