On January 11, a message on the SunTrapp Facebook page said that the DABC had granted the bar permission to temporarily close for 10 days. Ten days later, a post was made explaining a 10-day extension of the closure. On Feb. 3, the page showed a lawsuit pitting the club’s owners against each other.
The SunTrapp is Salt Lake City’s longest-running bar serving the LGBTQ community.
In the complaint, FChugg, Inc., the corporation registered as the owner of the bar, named four plaintiffs — shareholder Michael Goulding and former employees Haley Jones, Trapper Geary, and Michael Smith.
The complaint says that current board members of the corporation are Riley Richter and bar manager Donald Neeley. It also says that Richter owns 60 shares of FChugg and Michael Goulding owns 40 shares.
Because, the complaint says, Goulding owns a minority share of the business, and he is not a member of the corporation’s board, he has no authority to manage the business or act on its behalf.
But Goulding did, indeed, engage in unauthorized actions and caused potential harm to the business, the complaint says.
FChugg is seeking monetary damages for “conversion of property” owned by the corporation, unlawful trespass, civil conspiracy, and “tortious interference with FChugg’s existing and prospective economic relations.
The SunTrapp was incorporated by Frank Chugg on Dec. 23, 2013, with Chugg and Robert Goulding as directors. At the time, 100 shares of common stock were authorized, all of which were owned by Robert Goulding.
In April 2018, Robert Goulding died and left 40 shares to his brother Michael Goulding, 30 shares to Riley Richter, and 30 shares to Dennis Gwyther.
According to the complaint, Michael Goulding was disqualified from owning the bar because of something in his criminal history. He then transferred his 30 shares to Joshua Lakin.
In May of 2019, Dennis Gwyther was shot and killed on I-15 as he was heading to Boise, Idaho. His 30 shares passed to his husband, Matthew Gwyther. Matthew Gwyther’s shares were redeemed by FChugg, Inc., according to the complaint.
On Dec. 28, 2021, the board of FChugg, Inc. consented to sell the 30 shares to Riley Richter for $93,000, making him the majority shareholder, said the complaint.
In addition, the complaint says FChugg paid Michael Goulding weekly wages of $1,750 since March 2020 in exchange for services to the bar, though Goulding has not actually provided said services.
Instead, the complaint says, Michael Goulding harmed the business by being intoxicated while on the premises, encouraging gossip, demanding employees see him as having authority to run the bar, encouraging employees to bring “unfounded” claims against FChugg employees, withdrawing $25,000 from an FChugg bank account, and then withdrawing another $60,000.
The first withdrawal of $25,000 occurred on Oct. 15, 2021, and was re-deposited to the account after a threat of legal action.
Michael Goulding alleged that he had “cleared his criminal records such that his ownership would not endanger FChugg’s liquor license” and told representatives of the Utah Division of Alcohol and Beverage Control that he was now the person authorized to conduct the business of the corporation, the complaint alleges. The FChugg board was made aware of the communication on Dec. 28, 2021.
The complaint says that Michael Goulding has never provided evidence of his assertion that his criminal record was expunged.
The complaint continues that once the $60,000 unauthorized withdrawal by Michael Goulding occurred on Dec. 31, 2021, the corporation determined it needed to have the locks to the building changed to prevent the defendants from accessing the building without authorization. Richter and his husband Micheal Repp, who is also an employee of the bar, left on a planned vacation outside the country on January 1, 2022.
In their absence, the defendants are said to have shown up at the bar, declaring themselves to be in charge of the business. Michael Goulding announced that he had fired Repp and bar manager Donald Neeley. The complaint says that FChugg employees that disagreed with the action would be terminated. Neeley was forcibly removed from the bar.
The complaint also alleges that the defendants drilled holes in the new locks after the bar was closed, that numerous attempts were made to access the corporation’s business records, that there was an attempt to change the company’s password for the security system and cameras, and there were attempts to change the passwords on social media accounts and point-of-sale system.
The complaint says the defendants told employees and customers that they were engaging in a “coup” and a “takeover” while disparaging the reputations of Richter, Repp, and Neeley.
On Jan. 10, 2022, Richter contacted the Utah DABC to obtain a temporary suspension of the business’s liquor license beginning Jan. 11.
An attempt to negotiate an agreement between the parties was unsuccessful, which is why the complaint was filed with the Third District Court of Utah.
As of the date of printing, none of the defendants have filed a response to the complaint nor replied to requests to be interviewed for this story.