[dropcap]A[/dropcap] fascinating array of characters have roles in what looks to become West Hollywood’s most dramatic piece of contemporary gay theatre — Alfredo Diaz’s crusade against the opening of David Cooley’s new restaurant and bar, and Chris Miller’s lawsuit alleging embezzlement by Diaz, his partner in Revolver Video Lounge.
The roles range from major to minor. Of course there is David Cooley, the founder of The Abbey, one of the country’s best known gay restaurants and bars. Diaz’s opposition to Cooley’s plan to open Cooley’s, a gastropub on Santa Monica Boulevard near Robertson, is what put this gay drama on stage.
Then there’s Kevin Huvane, whose role as managing director of Creative Artist Agency makes him an indisputably powerful figure in the Velvet Mafia. In more minor roles are Vince Quattrocchi, co-owner of Eagle LA (the Leather Mafia?), and Mark Nelson, one of the country’s leading gay event promoters, who recently retreated from the hectic gay scene in New York City to hole up in a cottage in Venice.
The curtain fell on Act One of the drama last month, when the West Hollywood City Council unanimously denied Diaz’s final appeal to restrict if not delay the Cooley’s project. Diaz’s campaign centered around his contentions that Cooley’s would intrude on the atmosphere of the adjacent West Hollywood Park and that the city’s decision to grant an exception to certain provisions governing the Cooley’s site would lead to it becoming a loud nightclub. Diaz took to stages as varied as the city Planning Commission, the City Council Chambers and WEHOville.com to make his case, attracting a large audience of both supporters and opponents. It was in Act One that Huvane made an appearance in a text message to Diaz, a copy of which is buried deep in the hundreds of pages filed in the Miller / Diaz lawsuit.
“Are you really appealing the Cooley decision??” Huvane texted Diaz at 4:53 p.m. on Dec. 22 last year. “Yes,” responded Diaz. “Not smart” Huvane texted back. Diaz’s “Merry Christmas to you and your family” text to Huvane on Dec. 25 didn’t get a response.
CAA emerged again in January, when Chris Miller emailed Diaz from the CAA offices, asking him who was behind flyers being distributed that urged local residents to oppose the Cooley’s project.
“I don’t want Revolver’s hands anywhere near that mess,” Miller wrote. “I’ve said from the beginning that I don’t want us being the poster child. You can protest all you want as a concerned father of kids and the impact on the park but I’m not getting embroiled in a battle over this.”
Miller was at CAA, Diaz says, because he is president of Drew Barrymore’s production company, and CAA is Barrymore’s agent. And why did the issue come up while Miller was at CAA? “Because there’s some tie between CAA and SBC and it’s looking like SBC is going to sue for slander,” Miller wrote. His mention of SBC was a reference to SBE, the entertainment group that bought The Abbey and which is assumed by many to have a stake in Cooley’s.
“Following the meeting, Chris told me that I should not proceed with the appeal, as I would risk bringing Cooley (a major developer in West Hollywood) and CAA down on Revolver, and they were too rich and powerful to mess with,” Diaz said.
Nevertheless, Diaz went ahead, asking the City Council on March 17 to overturn an earlier decision by the Planning Commission to approve the Cooley’s project. Before that meeting, Diaz said, he was asked to attend a meeting with Miller at which he said Miller’s lawyer threatened to sue him if he didn’t give up his share of Loaded Gun LLC, the company behind Revolver. (Each of them owns 44.5 percent of the business).
The curtains opened on Act Two on April 1, when Miller filed a lawsuit alleging Diaz had misused tens of thousands of dollars of Revolver’s revenue and mismanaged the business so as to put it at risk of being closed. That’s when Vince Quattrocchi and Mark Nelson appeared on stage.
Diaz solicited their testimony to prove that David Khinda, a photographer and masseur and once Miller’s boyfriend, had never had a management role at a bar and, presumably, wouldn’t be a candidate to replace Diaz or shouldn’t have had what some saw as a management role at the bar. “I have … been friends with Mr. Khinda for years,” Nelson wrote in a statement to the court. “His primary business is massage therapy, and I would be surprised if he had any interest operating a bar.” The Eagle’s Vince Quattrocchi said Khinda worked for him as a bartender seven or eight years ago and never was a manager.
Miller’s previously publicized lawsuit contained detailed allegations about Diaz’s alleged misuse of Revolver’s money. However Diaz’s voluminous response, reviewed by WEHOville.com, refutes some of Miller’s charges, raises allegations of its own and reveals some of the financial pressures involved in owning a Boystown bar.
One of the biggest problems Diaz reveals is that when Revolver opened in October 2011 it had no operating capital, having spent $250,000 to secure the lease on the space and another $600,000 renovating it. Halloween, however, was a promising opening, with Diaz telling Miller in a text message the next day that overall revenue had topped $36,000.
“We’re the golden child of the boulevard,” Miller texted back, agreeing with Diaz’s proposal that they each take $6,680 out of that night’s proceeds.
But every night wasn’t so bountiful. In a financial statement covering 2012, Revolver reported revenue of $1.83 million, with 79 percent of that coming from alcohol sales and 15 percent from beer sales (wine and soft drinks accounted for the rest). However, running the business was expensive, with $1.16 million going to pay bartenders and managers, $100,000 for security, and $275,000 for music and entertainment. The rent took another $180,000. The result was a reported loss of $110,000 for the year (although when non-cash expenses such as depreciation and amortization are factored out, the loss was only $19,000. And Diaz was paid an $89,000 management fee.)
The only other report provided the court shows revenue of $1.1 million for the eight months ending in August last year, a ten percent decline over the monthly average year before. When non-cash expenses are factored out, Revolver had lost $24,000 by August. Whereas after Halloween 2011, Diaz was boasting revenue of $36,000 in one night, on Jan. 24 this year he emailed Miller to brag about total sales of only $6,250 the night before (a Thursday). That night Revolver hosted the Rentboy Hookie Awards, a ceremony honoring male prostitutes.
“We totally crushed Micky’s and Eleven,” Diaz said, referring to nearby competitors. “Awesome!” Miller responded.
While Miller has accused Diaz of using Revolver’s money for personal expenses, Diaz said Miller did the same. “In or about June 2012 after a particularly successful Gay Pride, Chris took $16,000 in cash from Revolver for a down payment on a new Porsche,” Diaz said. “Chris already owned a 7 Series BMW.”
Later that year, Diaz said, “Chris informed me that he was going to start running his approximately $1,282 monthly BMW payment through Revolver… but would allow me to drive the car.” Revolver’s accountant, Douglas Napp, said that expenditure wasn’t appropriate. But, Diaz said, Miller continued to have Revolver pay for his cars (he switched from the original BMW and the Porsche to leasing two 5 Series BMWs). Diaz said he put a stop to that in February.
While Miller accused Diaz of using Revolver’s money to pay for his meals, Diaz said Miller did the same, charging $2,700 for meals at SoHo House, the private club on Sunset Boulevard. “All told in 2013, Chris received over $47,000 in cash from Revolver,” Diaz said. When payments for maid services, airline travel, meals at SoHo House and other expenses are added in, “Chris’s cash take and personal expenditures funded by Revolver exceeded $100,000.”
After a contentious meeting with Miller and his lawyer on March 10, at which Diaz refused Miller’s request that he step down as the bar’s manager, Diaz said he put into place new rules barring Revolver for paying for his and Miller’s personal expenses, including maid services and car payments. Now neither can take cash out of the bar. All checks for more than $500 require two signatures.
Act Three of this Boystown drama is likely to open in L.A. Superior Court, at a date to be determined. That’s if Diaz is correct in his contention that Revolver doesn’t have to worry about being closed down by the State of California for what Miller claims is failure to pay $300,000 in taxes. Stay tuned.