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Sexual Dealing

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Cabaret Royale and the Labor Department are negotiating a settlement on the back pay, Millard says.

At the same time, the club is trying to shake off a series of pesky--and potentially costly--individual lawsuits, such as the one filed by Ann Marie "Ami" Lindsey, a former Cabaret Royale head waitress who sued for discrimination after club managers turned down her request to dance, saying the 40-year-old woman was too old.

Another 40-plus former head waitress, Linda York, joined the suit when Cabaret Royale fired her. The women are seeking a total of $2.5 million in damages; an appeals court overturned a lower court's order to dismiss the case.

The lawsuit has dragged on for years and stalled indefinitely when Izzedin filed for bankruptcy on behalf of two of the corporations that used to run Cabaret Royale, a move Lindsey says shows the latitude powerful organizations have over their employees.

"Here they are expanding to Mexico and around the world," she says. "And I'm back in Dallas, still waiting six years later for my day in court. This is not justice."

Lindsey and York aren't the only women who've sued the topless club. Two cabaret-style dancers, Chris and Candy Smith, sued for breach of contract after Joe Najjar, the club's vice-president for operations, allegedly reneged on an agreement to allow the women to dance with covered breasts.

Days before the sisters were to perform for a live audience, they allege, Najjar told them the revue was canceled. They could dance topless instead--or wait tables and answer phones. The women sued for $9,000.

Najjar, who now oversees the Mexico City club, did not return phone calls from the Observer.

In 1992, another exotic dancer, Victoria Cher Harris, sued Cabaret Royale, a production company, and a local rancher after falling off a horse during filming of a Cabaret Royale video. The flick showed the women riding horses in slow motion--hair flowing in the wind, skin dewy and pink.

The venture ended in disaster, however, soon after Harris mounted her horse. The creature immediately headed for a low-hanging branch--and popped the dancer off her saddle. Harris suffered a severe concussion, bruises, and cuts and later sued for $25,000 to recover medical expenses.

Cabaret Royale officials dismiss all of the lawsuits as frivolous and have employed a host of lawyers to contest them. "They're nonsense lawsuits," Millard says. "It's a case of suing anyone you can. It's not hard to get the address of the courthouse."

In May, Salah Izzedin filed bankruptcy for two Cabaret Royale-related corporations, Prive and Priba. The bankruptcy stalled the lawsuits for the moment and turned the focus to the club's assets. The bankruptcy filing means that, even if people suing Cabaret Royale win their lawsuits, the nightclub may not have to pay a dime--because Izzedin insists Prive and Priba were broke at the time of dissolution.

Since declaring bankruptcy for Prive and Priba, Cabaret Royale officials have striven to separate the two companies from the famous nightclub. Prive and Priba were only operating Cabaret Royale, attorney Jack Gillis says. They were not Cabaret Royale itself.

"The club was not being operated to [Cabaret Royale Corporation's] standards," Gillis says, "And the lease was terminated."

Gillis and Millard also contend that Salah Izzedin has little influence on the new, improved corporations running Cabaret Royale.

"Izzedin doesn't own Cabaret Royale," Gillis says. "It's a publicly traded company. What he does for a living these days, I couldn't tell you."

What Gillis and Millard fail to point out is that Izzedin, through his Oceanic Oil Corporation, has a controlling interest in the topless club's new parent company, Cabaret Royale Corporation. And his sister Leila Izzedin is president of CRC Dallas Food and Beverage Operating Corporation--the corporation that replaced Prive and Priba, according to Securities and Exchange Commission filings.

Cabaret Royale is further entangled in the Izzedin family through the Fuoad Izzedin-controlled limited partnership that supposedly fired Prive and Priba, Walhill Partners Limited, which transferred its assets to a Delaware "shelf" company in September of 1993, according to SEC records. The "shelf" company, which changed its name to Cabaret Royale Corporation after the transfer, had been incorporated on paper for years but wasn't doing business.

After the transfer of assets, Cabaret Royale Corporation applied to trade its stock on the NASDAQ and Boston stock exchanges--the latter under the symbol GIRL.

The bankruptcy trustee is now investigating whether assets have been illegally transferred from one Izzedin corporation to another to avoid paying creditors.

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Denise Mcvea