Jamie Leeds (Washington Blade file photo by Michael Key)

The lesbian owner of a popular seafood restaurant along the 17th Street business district near Dupont Circle is asking the community to support the repeal of a city law that she says allowed six people to force her to reduce her outdoor seating capacity from 40 to 20 customers.

Jamie Leeds, the chef and owner of Hank’s Oyster Bar at 1624 Q Street, N.W., issued a statement over the weekend informing customers and supporters that inspectors with the city’s Alcoholic Beverage Control Board ordered her on Friday night, June 8, to close half of the restaurant’s patio space.

Leeds said that the order came the day before the annual Capital Pride Parade was to travel past her patio, limiting the number of patrons who wanted to dine on the patio while watching the parade.

“This action shutting down half of our outdoor patio on the night before the annual parade was the result of one of the license protestants phoning in a complaint to the city, and occurs before we have even had a hearing before the ABC Board,” Leeds said in an open letter to the community.

“The ongoing harassment by this small band of residents is astonishing and the timing of this individual’s complaint before the annual celebration is despicable,” she wrote in her letter.

Leeds’ call for the repeal of the law that allows as few as five citizens to contest liquor license applications comes at a time when gay and straight nightlife advocates have urged gay D.C. Council member Jim Graham (D-Ward 1) to consider introducing legislation to ease what the advocates say are overly burdensome regulations pertaining to such businesses. Graham chairs the Council committee that oversees the city’s liquor laws and the agency that enforces them.

Michael Hibey, the attorney representing the six residents opposing Hank’s Oyster Bar’s use of the expanded outdoor seating, declined to comment. David J. Mallof, one of the six nearby residents who has taken a lead role in opposing Hank’s expansion of its outdoor seating, also declined to comment.

The Blade couldn’t immediately reach the other five residents opposing the termination of the voluntary agreement. They are: Alexis Rieffel, Ralph N. Johnson, Susan Meehan, Michael Fasano and Patricia E. Steele.

Fred Moosally, director of the city’s Alcoholic Beverage Regulation Administration, which oversees the ABC Board, confirmed on Monday that the inspectors responded to a complaint by a representative of the six residents opposed to the restaurant’s expansion.

But Moosally told the Blade that the call for restricting the patio’s use was in response to a May 17 D.C. Court of Appeals decision ordering the city to reinstate a document known as a voluntary agreement between Leeds and the six residents. The agreement bars Hank’s from expanding its patio or any part of the restaurant beyond the space it occupied at the time it opened in 2005.

At Leeds’ request and following an earlier hearing, the board terminated the voluntary agreement in 2010, allowing her to expand into outdoor and indoor space in an adjacent building that became vacant that year.

The six residents appealed the board’s action to the Court of Appeals. The court voided the board’s order terminating the voluntary agreement and remanded the case back to the board. It instructed the board to consider two issues the court said the board was legally required to consider but failed to do so at the time it terminated the voluntary agreement.

Moosally said ABC Board inspectors informed Leeds on June 2 during a visit to the restaurant of the court ruling and its effect of reinstating her voluntary agreement. Although he didn’t say so directly, he implied that Hank’s knew more than a week before the Pride parade that it couldn’t use the full space of the patio at the time of the June 9 parade.

Andrew Kline, a licensing counsel representing Leeds before the ABC Board, disputes Moosally’s assessment, saying he believes the board had to take “another step” of rescinding its 2010 order terminating the voluntary agreement before it could require Hank’s to give up use of the full patio.

Kline said the court decision didn’t prevent the board from allowing Hank’s to continue to use its full patio while the board deliberates over its decision, as mandated by the court, to make a determination on whether the voluntary agreement should once again be terminated.

The board scheduled a hearing on Wednesday, June 13, to address issues that the appeals court said must be resolved before the board can make a final decision on whether to retain or terminate the voluntary agreement.

The court decision was the latest development in a seven-year dispute between Hank’s Oyster Bar and the handful of nearby residents, who have contested the restaurant’s liquor license in an effort to obtain restrictions through the voluntary agreement.

Leeds says in her letter that she was pressured into signing the voluntary agreement in 2005, the year she opened the restaurant, as a condition to end a formal protest of the license by the six residents. She said the license protest could have dragged on for months, delaying her ability to obtain a liquor license and jeopardizing her ability to open her new business.

Most observers following the dispute, including LGBT activists, believe Hank’s opponents are motivated by an aversion to an “overconcentration” of liquor serving establishments on 17th Street, which the opponents say have the potential for causing neighborhood disturbances. Most observers don’t think the opponents of Hank’s expansion are motivated by anti-gay sentiment.

Hank's Oyster Bar (Washington Blade file photo by Michael Key)

But many LGBT activists have teamed up with nightlife advocates in calling on the City Council to repeal the law that gives as few as five residents legal standing to challenge a liquor license and push for restrictions similar to those in the voluntary agreement signed by Hank’s.

They point out that Hank’s has never caused any problems in the neighborhood, either before or after it expanded its operations into the adjacent space in 2011.

Although the ABC Board makes the final decision on approving a voluntary agreement or approving restrictions on the operation of bars and restaurants, business owners have said a protest by a “gang of five,” as the business owners have called the protesting residents, can hold up a license for months. They say the delays result in high monetary costs for legal fees and the cost of renting spaces that can’t generate revenue until the license is approved.

One proposal offered by nightlife advocates is to eliminate the existing provision of the liquor law that gives five or more citizens authority to contest liquor licenses and restrict that authority to the elected Advisory Neighborhood Commissions. ANC’s currently have that authority.

“If you agree that allowing a small number of individuals to dictate what happens in our community is wrong, please contact ABRA; Ward 2 Council member Jack Evans; Council member Jim Graham, chair of the committee that oversees ABC [Board issues]; and Mayor Vincent Gray,” Leeds said in her open letter. “The right of a group of 5 residents to hold up a license application should be eliminated from the law.”

Leeds’ letter came two days after Mayor Gray told a joint Capital Pride-Washington Blade town hall meeting that he was concerned over the ability of just five people to block licensing applications for businesses such as restaurants.

“I don’t think a small handful of people should be given the opportunity to unreasonably hold up action on something that a preponderance of the people want to move forward on,” Gray said.

“I have always believed that most so-called ‘voluntary agreements’ are actually ‘coerced’ agreements,’” said gay activist Peter Rosenstein, who lives about two blocks from Hank’s.

“[T]his case should convince the City Council and the mayor to change the law,” Rosenstein said. “We live in a democracy and allowing a complaint by five people to determine what is seating capacity for a restaurant is clearly not democracy.”

Rick Rosendall, vice president of the Gay and Lesbian Activists Alliance and a resident of 17th Street near Hank’s Oyster Bar, characterized as “outrageous” the action by the six residents to restrict Hank’s patio usage.

“It is absurd and harmful, and D.C. Council members and Mayor Gray need to hear from people who appreciate that the neighborhood and the city are not served by allowing small, unrepresentative groups to hold everyone else hostage to their cramped, entitlement-drenched desire to turn thriving urban neighborhoods into quiet suburbs,” Rosendall said.

One of the court’s requirements is that Leeds makes a “good faith” effort to reach a new voluntary agreement with the six residents, something Leeds doesn’t think is possible.

“[W]e did try to work this out with those opposed to us back when we first sought termination of the VA, but they refused to meet,” she said. “Since the Court of Appeals decision was reached, we offered to address their concerns with a more limited VA, but they insist we cut our outdoor occupancy by 25 percent, even though there have been no complaints.”

The second requirement is to show that the neighborhood has changed since the time the agreement was signed in 2005 that would support terminating the agreement. Kline said one key change that has occurred is the ABC Board repealed part of a longstanding 17th Street moratorium on new liquor licenses that prevented bars and restaurants from laterally expanding to adjacent buildings or properties.

The Dupont Circle Advisory Neighborhood Commission, which supports allowing Hank’s to expand its patio, supported the lifting of the moratorium on lateral expansion.

The president of the Dupont Circle Citizens Association, Doug Rogers, issued a statement on Monday denouncing the ABC Board’s decision to shut down Hank’s expanded patio operation, saying the board should have waited until after its scheduled hearing on June 13.

“What is even more infuriating is that two toxic people in our neighborhood are allowed to shut down part of a legitimate business and force them to spend thousands of dollars in legal fees,” Rogers said in his statement. “Their ability to do this should be eliminated from D.C. law, and I urge Mayor Gray and the D.C. Council to reform D.C.’s archaic regulatory laws.”