On the Friday night that ushered in Memorial Day weekend, Neil Cohen looked every bit the successful club owner. The dance floor at his new club, S.O.B.'s, was packed, and the room reverberated with the salsa sounds of Lefty Perez and His Orchestra as Cohen sat at a table with a few young dark-haired beauties and the choreographer of the film The Mambo Kings, enjoying a late dinner. With his gray hair pulled into a ponytail, he posed for photos amid the tropical African decor, greeting friends and customers warmly, a man seemingly at the top of his game.
Looks can be deceiving. By the end of the long weekend, S.O.B.'s two top managers, its executive chef, and its head bartender (among others) had quit, in large part because they were owed thousands of dollars in back pay. By Sunday the place appeared to be in open revolt: The bartender left in the middle of his shift, and a departing security guard is said to have dipped into the cash register, taking hundreds of dollars with him when he made his exit.
Those disgruntled workers are only the latest in a series of employees, contractors, artists, decorators, and musicians who say they are owed money for work they performed at S.O.B.'s before and after its grand opening in late March. Suzanne Lipschutz, the co-designer of the club, says Cohen's failure to pay the artists she commissioned on his behalf is especially infuriating because "he hurt people who couldn't afford to be hurt."
The nightclub even bounced four checks to the City of Miami Beach Building Department for permit fees required during renovation, according to Philip Azan, the department's assistant director. This week the general contractor who oversaw that renovation, Lawrence Cook, filed suit against Laco Music, the company that operates S.O.B.'s, seeking about $8500 in unpaid debts, including a single bounced check for nearly $7000. Brad Lotspeich, Cook's attorney, also placed a lien on the property, a former synagogue at 1532 Washington Ave. that previously had been the site of the Van Dome nightclub. An electrical contractor, Ital Power Corporation, has already filed its own lien for $6041; David Hopper, a light and sound contractor says he will soon do the same.
This past week the state's Division of Alcoholic Beverages and Tobacco began an investigation into the club's handling of its liquor supply. And as the result of a bounced $1000 check made in partial payment for a May 5 performance by jazz flautist David Valentin, Fantasma Tours International sent a letter threatening to refer the matter to the Dade State Attorney's Office. "I've been lenient because I'm interested in seeing this club survive," says Valentin's manager, Carl Valldejuli.
Neil Cohen acknowledges that the club has been unable to pay off all its debts and compensate its employees. (According to Cohen, he's behind less than $10,000 in back pay; former staffers say the amount is far higher.) "I'm in the process of straightening up everything with everybody," he claims. "I'm taking whatever money that's coming in and paying the people." While seeking out new investors, he insists, "If I owe someone a hundred dollars, I give them fifty. You try to spread it out." He says further that many of the people to whom he owes money pressured him into okaying work that wasn't originally proposed. "You trust people, and you're the one getting screwed," he complains.
(Such charges are derisively dismissed by Cohen's creditors. Lawrence Cook, for instance, disputes Cohen's assertion that Cook accepted as partial payment a huge stained-glass dome he removed as part of his renovation work. "What?" Cook sputters. "That's bullshit!")
S.O.B.'s did not get off to a very good start. Already in debt to contractors, the club's cash flow problems were exacerbated by its poorly publicized March 30 opening, in which salsa legend Celia Cruz drew only 135 people at $35 a head. (Cruz's booking fee: $20,000, according to Cohen.) A Spyro Gyra concert the following weekend was as big a fiasco. "All those years at the Ritz didn't prepare Cohen for the nightclub scene in Miami," says agent Mike Carr.
Cohen's partner in the S.O.B.'s venture, Larry Gold, fled after that first week. Thirteen years ago Gold opened the original S.O.B.'s (the name was an acronym for Sounds of Brazil) in New York City, where it has since become a premier venue for world music. From New York, Gold now says that he plans to take legal action to require the South Beach S.O.B.'s to change its name unless Cohen agrees to do so voluntarily.
The 46-year-old Cohen is experienced in legal matters. A former car dealer, in 1990 he was convicted on perjury and conspiracy charges in New Jersey and sentenced to 30 months in prison for his role in a bank fraud. According to press accounts in the New York Times and other media, he had received more than three million dollars in bad loans from a bank officer whom he bribed with free Mercedes leases and cash in the early Eighties. He later became the owner and manager of the successful Ritz nightclub in Manhattan. Cohen says his criminal past has no bearing on his current problems. "That was all in the past, really," he asserts.
But as a convicted felon, Cohen is barred by state law from owning a nightclub or possessing a liquor license. State records show that S.O.B.'s license was issued in the name of Laco Music, whose principal officer and investor is listed as John Penna, an amiable assistant to Cohen who used to sleep on the floor in a spare room in Cohen's home, according to former S.O.B.'s publicist Rene Costa and others. (Penna was unreachable for comment regarding this story.)
Costa says the club owes her $3500, including a $3200 bill for advertising on LOVE-94 (WLVE-FM 93.9), which Cohen persuaded her to charge to her personal American Express card, and never reimbursed. "I believed in his good faith," says Costa, who quit in mid-May
Other creditors took more aggressive action. David Hopper walked away with several microphones as ransom for the $3000 he says he's owed. Sculptor Roger Allen went to the club and removed from the walls two of the six masks he'd created and put them in his truck. "Give me the rest of my money [$300] and you'll get the masks," he says he told John Penna. After extended dickering, Allen reports, Penna forked over the cash.
Contractor Lawrence Cook, who says that he was paid without incident at first, began to worry about being compensated for his final two weeks of work when he saw management "bouncing checks left and right." So he sought to exert some leverage on Cohen. Before the club could open, it needed a certificate of completion from the city, a document that could only be secured by the general contractor. On March 28, the day of the club's press preview, Cook says, he refused to hand over the certificate until he received a check for $6754. "I'm thinking to myself, 'You can't bounce a check for that much -- that's a felony,'" Cook recalls. To his surprise, the check bounced anyway.
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Through it all, his adversaries say, Cohen has been cavalier. Lawrence Cook and Rene Costa both recall a meeting during which Penna, preparing to sign a check, nervously asked Cohen how much the club's account was overdrawn. "We're a million dollars overdrawn. Write the fucking check, John!" Cohen allegedly exclaimed. (Cohen says he doesn't recall that conversation and insists that he warned people to delay cashing checks when funds weren't immediately available.)
Vince Mrazovich says he and partner Jan Galliardt worked for far less than their usual rate when they built the colorful fake rock formations that give S.O.B.'s stage its special flair. Mrazovich says Cohen paid them $450 for materials and told them he'd pay them the balance due A $1000 for five days' labor A after the club opened. "It's been a few months and we take turns going down there weekly," Mrazovich says. "This isn't for me, it's for my ex-wife and kids, and the cops could put me in jail," the artist says he told Cohen, and adds that he has fallen behind in his alimony and child support payments. "He's not even given me $50, and that would help."
Cohen's creditors find his own flamboyant lifestyle irksome. Says Robert Escalera, a former assistant publicist who says he's owed about $500: "I don't mind doing charity work for Camillus House, but I'm not going to do it for someone who lives on Palm Island and drives around in a Jag."
Cohen, who does live in a rented house on Palm Island with his ex-wife and child, confirms that he drives a Jaguar, and admits that he's behind in his car payments and slow in paying rent. "This is a difficult, difficult market," he says of South Florida. "I tried to the best of my ability to make things work. It's not against the law to fail in business.