The city of San Bernardino has many creditors, according to documents recently submitted to a federal bankruptcy judge. There are banks, construction firms, a local sign maker... and a strip club.
Of all the creditors, the Flesh Club might have the longest and most litigious relationship with San Bernardino. The city went to court nearly 20 years ago in an effort to shut down the club over alleged code violations.
Then, five years ago, the San Bernardino strip club won a judgment of $1.4 million in lost earnings after an appeals court reversed the lower court's ruling. And then, yet another court later reversed that court's decision.
The Flesh Club’s longtime attorney, Roger Jon Diamond, says another court was scheduled to hear the latest appeal a week before San Bernardino filed for bankruptcy protection — a move that quickly froze the ping-ponging case in its tracks.
Diamond has asked the court to transfer the state appellate court proceeding to the bankruptcy court, and let the federal judge there make the final decision in the strip club's dispute with the city.
“Although it’s a little unusual, I’m suggesting that the federal bankruptcy judge be, in effect, the functional equivalent of the state appellate court because the claim is still pending and we want it adjudicated,” said Diamond.
If the bankruptcy judge hears the case and rules in favor of the Flesh Club, San Bernardino would have to pay all or at least part of the original $1.4 million, plus attorneys fees.
That would place the Flesh Club among San Bernardino's top 20 creditors, but it wouldn't guarantee quick payment in a case that's been anything but easy.