Mollies Cafe and Bar granted liquor license, changes corporate structure

UPDATED: Click here to download a list of taxes owed by Merriwether Investments and John and Jerrianne Wyman

Mollies Cafe and Bar won a new liquor license from Cape Girardeau by changing its corporate structure.

The restaurant at 11 S. Spanish St. since July 1 operated on a 30-day temporary license because of unpaid property taxes. Those taxes, which as of Tuesday totaled $67,838.23, are owed by Merriwether Investments or the company's owners, John and Jerrianne Wyman.

On Monday, the Cape Girardeau City Council granted Mollies a full one-year liquor license after John Wyman re-created the restaurant as Mollies LLC, a new company independent of Merriwether Investments.

Cape Girardeau city ordinances bar any person or company from being granted a liquor license if they owe the city any taxes. The city is owed $7,483.78 of the total property tax bill. Due to the way property taxes are structured, the city portion cannot be paid without the all the taxes being tendered. The last time Wyman or Merriwether Investments made a payment on their property taxes was Feb. 19.

Wyman remains the owner of Mollies, though he said Mollies LLC was not created to avoid taxes.

"Mainly the reorganization is for business purposes," Wyman said. "I've decided not to operate under Merriwether Investments because it makes better sense to break all of your businesses out. Merriwether doesn't have anything to do with Mollies and Mollies doesn't have anything to do with Merriwether."

City officials contacted about the corporate change and the unpaid taxes said the new ownership structure gives Mollies a clean slate for its liquor license. The 30-day temporary license -- something that isn't specifically mentioned under council licensing authority in the city code -- was portrayed when granted as a way of keeping Mollies in business while the tax bill was settled.

Heather Brooks, assistant to the Cape Girardeau city manager, said any assumptions that Merriwether Investments won't pay property taxes owed to the city are incorrect. She believes the city will receive its portion of taxes owed by Wyman or Merriwether Investments.

"This is a new separate legal entity," Brooks said. "Since they created Mollies LLC and don't owe anything under that, they are able to continue to operate. We treat them like any other new business."

City attorney Eric Cunningham said such transfer of ownership laws are common in other communities throughout the United States.

"So it's not a loophole in a circumstance like that when one entity is transferred to another," Cunningham said. "A prior debt won't follow to the new owner.

"Some people may say the owner and the corporation are the same thing," he said. "But the law looks at it differently. They are different people legally."

Debra Tracy, a council member for Ward 3, said she believes "it is a legal issue and as long as they're legally sound that's where I stand with it."

Mollies isn't the only liquor licensee to face issues this year as it sought renewal. Royal N'Orleans, another upscale restaurant at 300 Broadway, closed July 1 because it couldn't meet conditions set when the city council renewed the license. Main Street Bar, at 701 N. Main St., has had several violent incidents in recent years but was granted a license July 1.

Asked if she would be in favor of issuing another 30-day license in the future, Tracy said she would have to explore the option if it arose again.

Cape Girardeau Mayor Jay Knudtson said he thinks the entire liquor license application and review process probably needs to be revisited.

"It is clear that there are some gaps in the application process that does allow for folks to submit their applications in a strategic manner to avoid certain restrictions."

bblackwell@semissourian.com

388-3628

Pertinent addresses:

11 S. Spanish St., Cape Girardeau, MO

300 Broadway, Cape Girardeau, MO

701 N. Main St., Cape Girardeau, MO