HOUSTON, Nov. 14, 2014 /PRNewswire/ -- RCI Hospitality Holdings, Inc. (NasdaqGM: RICK) today announced a partial summary judgment by the U.S. Court for the Southern District of New York that a New York subsidiary owes $10.9 million under state and federal wage and hour laws from 2005-2012 to entertainers. RCI stated that the case is on-going, that there is no current or near term obligation to pay any sums as a result of this decision, and that the case will be appealed once final judgment is reached after trial.
The Company said it is disappointed with and disagrees with the Court's partial summary judgment decision and will appeal this ruling once a final judgment is rendered in this case after trial. The concept that the large sums of money earned by entertainers at Rick's Cabaret New York, for which they received IRS Form 1099s, do not offset the claimed wage obligations is a fundamentally flawed concept and contrary to how this same money is treated by various government agencies.
The Company and subsidiaries RCI Entertainment (New York), Inc. (RCI NY) and Peregrine Enterprises, Inc. have been defendants in a federal court action, pending since March 30, 2009, in the Southern District of New York relating to claims under the Fair Labor Standards Act and New York's wage and hour laws. Plaintiffs have alleged that they are seeking judgment equal to any unpaid wages, liquidated damages, interest, costs and attorneys' fees pursuant to the FLSA and New York Labor Law. The Company, RCI NY and Peregrine deny liability in this matter, are vigorously defending the allegations and have asserted counterclaims and affirmative defenses for offset and unjust enrichment.
Forward-Looking Statements
This press release may contain forward-looking statements that involve a number of risks and uncertainties that could cause the company's actual results to differ materially from those indicated in this press release, including the risks and uncertainties associated with operating and managing an adult business, the business climates in cities where it operates, the success or lack thereof in launching and building the company's businesses, risks and uncertainties related to the operational and financial results of our Web sites, conditions relevant to real estate transactions, and numerous other factors such as laws governing the operation of adult entertainment businesses, competition and dependence on key personnel. The company has no obligation to update or revise the forward-looking statements to reflect the occurrence of future events or circumstances.
SOURCE RCI Hospitality Holdings, Inc.
