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Current owners of Pozo Saloon sue promoter, allege fraud and breached contract

Posted at 1:02 PM, Sep 14, 2018
and last updated 2018-09-14 16:02:36-04

The current owners of a popular saloon and concert venue in Pozo are suing the son of the original owners after a deal between the two went sour.

The complaint filed in San Luis Obispo Superior Court Wednesday by 90 West Pozo Road, which represents Dean Marchant and Alex Kagan, claims Levi Beanway failed to uphold almost the entirety of his side of an agreement to keep the Pozo Saloon in operation.

The lawsuit includes three allegations – breach of contract, fraud, and negligent misrepresentation – which, according to the plaintiff, resulted in over $800,000 in damages.

According to the complaint, Pozo Saloon was all but closed down in 2017 when unpaid debts, deterioration and mismanagement left the saloon in dire straits.

Last April, the saloon canceled a country concert performance featuring the band Alabama, which would have welcomed thousands of attendees.

A friend of the Beanway family cited “health problems” but the band said on Twitter that the promoter did not pay contractual deposits.

The lawsuit claims that in the fall of last year, Beanway was “looking for a means to avoid losing the Pozo Saloon to creditors.”

Beanway met with the plaintiffs to discuss a deal in which Beanway and co-defendant Timothy Reed would obtain a third party to remediate the saloon, pay off debts and continue bringing in performing acts. In exchange, the suit says, the plaintiffs would purchase the property from Beanway for $350,000 with a provision that allowed Beanway to repurchase the property for $550,000 within two years.

Under the agreement, the plaintiffs would reportedly profit from bar and restaurant operations, as well as concert-generated revenues.

According to the complaint, the defendants said they’d lined up $250,000 in outside funding to repair and improve the Pozo Saloon, so they could re-open and begin hosting concerts again.

Will Browning, the attorney for the plaintiffs, said Friday that the cooperation between the two parties broke down “immediately” and said Beanway and Reed never followed through with their end of the deal.

The defendants allegedly failed to pay rent or utilities and did not remediate the saloon.

As a result, the lawsuit claims the plaintiffs incurred damages related to remediating the bar and obtaining the necessary licenses and permits, as well as contractors and laborers, to keep the saloon functioning.

“Defendants had no intention of performing on their promises and knew them to be false when made,” the complaint states. “Defendants made such representations in order to induce plaintiffs to purchase the Pozo Saloon and turn over operation of the Pozo Saloon to defendants.”

Browning said his clients purchased the property with the intent of owning Pozo Saloon but not operating the bar.

“It’s really a stretch for the personal lives of the owners,” Browning said.

According to the complaint, Beanway asserts that he has a 45 percent ownership interest in the property, which has hindered the current owners from selling or partnering with a different promoter due to a “cloud” hanging over the saloon.

Browning said the 45 percent interest was never agreed upon in a finalized contract between the plaintiffs and Beanway.

The complaint seeks damages to be determined at trial and declaration that the plaintiffs are the sole legal owners of the Pozo Saloon.

Beanway was not immediately available for comment on the lawsuit.

Browning said Beanway, nor an attorney representing the defendants, has responded to the complaint.