First, They Came for the Bar Owners....

 

Mission Accomplished: The shuttered Twilight Room Annex, a casualty of Oregon's anti-Business soviet.

Chris Penner, owner of the Twilight Room Annex club in Portland, Oregon, had bills to pay and a payroll to meet. He called up his business account only to find that it had been completely drained.

“All my money was gone,” Penner later related to the Oregonian newspaper. He was shocked, but not completely surprised, by this development: “I raced to the bank, kind of having an idea what had happened.”

The criminals who had siphoned away Penner's earnings were employed by the Oregon State Department of Revenue, who were enforcing a $400,000 punitive damage award against the bar owner for a supposed act of discrimination based on sexual orientation. His alleged victims were the “Rose City T-Girls,” a “diverse, informal social group” catering to males who “identify” as females. That award was imposed by the Oregon Bureau of Labor and Industry (BOLI), a Soviet-style administrative body whose self-appointed mission is appears to be the annihilation of small businesses. 

In keeping with established procedures, Penner had informed the Bureau of Revenue that he was appealing the BOLI's ruling. 

 

When he rceived no response from the agency, Penner believed that the matter would be put on hold while his case worked its way through the state Court of Appeals. At the same time, he was tormented with persistent suspicions that his bureaucratic tormentors would act without giving him due notice. Those suspicions were fully validated.

“They don't have to notify you,” Penner observed with of the state-licensed larcenists who plundered his bank accounts. “They just sweep in and take the money” – first, $13,000 from his business account, then more than $3,000 from his personal checking account on the following day. Penner was able to save enough of his personal funds to pay his employees in cash before putting up a sign announcing that the club would be closing on the following Saturday.

Penner's business was destroyed because he had tried to save it.

On a typical Friday night, anywhere from eight to 54 “T-Girls” could be found at the Annex Club. Whatever their numbers on a given evening, they were often the only paying customers there. If the club didn't do big business on Friday nights, it couldn't survive. Between 2009 and 2012, annual Friday night sales had declined by more than thirty percent – a formula for extinction in a highly competitive market where profit margins are very small. 

 

Unlike bakers Aaron and Melissa Klein, residents of Gresham, Oregon who face a similarly ruinous financial penalty for declining to create a wedding cake for a same-sex couple, Penner was not a Christian entrepreneur. No religious scruples inhibited him from serving Portland's famously “diverse” marketplace. It was because Penner stumbled over one point that he was deemed guilty of violating the whole “law” of diversity. In the eyes of Oregon's Tolerance Commissariat, he was no better than “homophobes” and other unregenerate heathen. 

 

Being "offended" for profit: Members of the "T-Girls" group.

Uncontested testimony before a “forum” convened by the BOLI documented that the Twilight Annex had “sponsored diverse events in the past such as `a reception for a lesbian marriage'; multiple `pride' events, including events that involved cross-dressers; and `fame' nights for gay, lesbian, and transgendered persons.”

 

Roxy Sugarrush, a member of the T-Girls, said that Penner's club was particularly attractive “because it was a `non-gay' club” and its clientele had included ladies “who played bunco and whom [Sugarrush] would not have met at a gay club.” Several other members of the T-Girls group described the club in similar terms. None of them had been treated with discourtesy by Penner or his employees who, after all, dealt with them as paying customers.

During the seven years that manager Cindy Benton had been employed at the club, acknowledges the BOLI, “no customer who has entered … has been refused service during their visit because of how they were dressed or because of their sexual orientation.”

From the club's perspective, the problem wasn't the presence of the T-Girls, but the absence of other customers. 

 

Penner's supposedly unlawful act did not consist of banishing the cross-dressing customers from his club, but of asking them, politely, not to monopolize it on what had previously been the busiest night of the week. In doing so, he hurt the feelings of people identified as part of a “specially protected class” in a state where monetizing such trivial moments of social awkwardness is one of the few surviving industries. 

 

The Twilight Room was once a thriving venue.

Amid a severe and worsening downturn in his Friday night sales receipts, Penner left two telephone messages with T-Girl “administrator” Cassandra Lynn, described in legal filings as “a male who refers to himself as a `girl' and is married to a female.” 

 

“Unfortunately, due to circumstances beyond my control I am going to have to ask for you … and your group not to come back on Friday nights,” Penner explained in a voice mail left for Cassandra Lynn, organizer of the T City Girls. “I really don't like having to do that but unfortunately it's the area we're in and it's hurting business a lot.” 

 

Acting on Penner's invitation to call him with any questions, Lynn left a message demanding to know what the “real reason” was for the club owner's request – assuming, of course, that it was the product of an unstated, invidious motive.

“There is no underlying reason for asking you folks not to come back other than money,” Penner replied. “Sales on Friday nights have been declining at the bar for the last 18 months. I've done some investigating as to why my sales are declining and there's two things I keep hearing: People think that a) we're a tranny bar or b) that we're a gay bar. We are neither. People are not coming in because they just don't want to be there on a Friday night now.”

Penner had bought the facility, known at the time as the P-Club, from an owner and former business partner who had nearly bankrupted it through mismanagement (leaving a financial mess for which Penner bore the costs). 

Within a year it became clear that the T-Girls had made the bar their de facto private club on Friday nights. 

 

Club manager Cindy Benton testified that female customers “complained … about having to share the women's restroom with the T-Girls,” who despite “identifying” as females were biological males. When the T-Girls were in the club, Benton recalled, it was common to see “customers come in the front door, look around, then leave and not come back.”

Penner wasn't running a church bingo parlor, and he was willing to meet the market as he found it – but he knew the club couldn't survive as a niche establishment. The T City Girls were essentially driving away young females, which meant that young males weren't visiting the club, either. 

 

Practitioners of free market capitalism understand that the purpose of a business is to earn a profit by satisfying the largest population of customers. The Portland SSR, however, is ruled by people who believe that businesses exist to serve the social and political priorities of central planners – and to generate the tax revenue necessary to fund social engineering schemes. 

 

Commissar Avakian.

BOLI Commissioner Brad Avakian is a chromosome-level collectivist and notorious tax “deadbeat,” the latter being the least offensive of his traits. Through his position he exercises plenary power on behalf of “eliminating discrimination” from the marketplace. In practice this requires the destruction of the marketplace and the principle of private property ownership on which it depends. 

 

Nothing in Oregon's anti-discrimination statutes authorizes the Labor Commissioner to award punitive or compensatory damages to a would-be customer who files a discrimination claim against a business owner. 

 

Without statutory authority or judicial precedent, Avakian has devised a novel theory of “law” under which hurt feelings create a cause of action for “damages.” This is supported by a recombinant legal doctrine in which terms and provisions found in the anti-discrimination statutes are fused with the BOLI's previous rulings to provide the Commissioner with whatever “authority” he and his subordinates require to carry out their mission. 

 

The BOLI is not a judicial body, nor an adversarial one. The Commissioner himself files a complaint against a targeted business, which is heard by a “forum” supervised by an administrative law judge. The prosecutor is employed by the agency, as is the official who issues “findings of fact” and imposes awards. 

 

Business owners summoned before the body are unable to know the “law” that will be applied against them: The agency's rules of evidence and procedure are based almost entirely on its own previous rulings, adapted to the needs of the current case. If the complaints against Penner had been filed before an actual court, the accusations would probably have been dismissed on the basis of impermissible vagueness. 

 

One typical example of the BOLI's protean standards of “law” is found on page 38 of the Final Ruling in Penner's case, where Deputy Commissioner Christie Hammond, referring to a 1985 employment discrimination ruling, blithely writes that “The forum adopts the above definition, deleting the word `employment'” – thereby applying previous precedents dealing with workplace discrimination to a case involving alleged denial of service to a customer. 

 

Where the expresion “rule of law” refers to a limitation on government behavior, rather than being used as a phrase to codify whimsical exercise of government power, alterations of that kind are made through legislation, rather than through self-serving pronouncements by an unaccountable functionary. 

 

Elsewhere in the ruling, Sub-commissar Hammond notes that six key terms dealing with discrimination are not defined in the statute, and that “To date, no such rules have been adopted” by the BOLI. In addition, there is “no prior case law interpreting these words in the context [of Oregon anti-discrimination statutes] and neither side offered any legislative history to assist the forum in interpreting them.” For the BOLI, however, “law” is whatever they claim the right to do.

John Locke famously described tyranny as a “the exercise of power beyond right,” a condition that exists when an official “makes not the law, but his will, the rule.” 

Penner didn't break the “law,” because no statute or existing guidelines forbade him to make his polite request of the T-Girls. That “law” was summoned into existence by Commissar Avakian and his comrades in order to make Penner “an offender for a word.” In this case, Penner was made an offender for few sentences spoken in the desperate hope of saving a business that his supposed victims considered valuable until they were offered a way to profit from its destruction. 

 

Cassandra Lynn, who “felt disgraced and extremely humiliated” by Penner's polite voice mail messages, was awarded $50,000 “for the emotional, mental, and physical suffering she experienced as a result of [Penner's] unlawful practices,” decreed the BOLI. Ten other members of the T-Girls group received awards of at least $35,000 each as compensation for similarly disabling contact with words that would have been quickly forgotten by any practicing adult. 

 

"Expert witness" Minter.

To understand the “physical and emotional damages” supposedly inflicted on the T-Girls, the BOLI consulted the “expert” testimony of Shannon Minter, Legal Director of the National Center for Lesbian Rights (who would go on to be appointed by Barack Obama to the Commission on White House Fellowships).

Minter's oracular insights illuminated matters that defied the understanding of the uninitiated – for example, why Amy Lynn (who identifies as “60% Amy and 40% male”), a fragile individual who claims to have lost 15 pounds after exposure to Penner's “hurtful” words, is entitled to $35,000, while Susan Miller (“non-gay male who cross-dresses as a female but is `not transitioning'”) should receive $40,000 after gaining ten pounds for the same reason. 

 

In the proceedings of the BOLI “forum,” the claims made by an “aggrieved person” who belongs to a “specially protected” class are entirely self-ratifying: “An aggrieved person's testimony, if believed, is sufficient to support a claim for mental suffering damages.” 

 

Since the prime directive in proceedings of this kind is to “believe the victim,” every pathos-drenched syllable uttered by the complainants is taken as unassailable evidence. Penner's attorney was denied an opportunity to depose the “victims” under oath, and most of his motions to compel them to answer written interrogatories were denied. Permitting the accused to confront or cross-examine his accusers might interfere with the BOLI's mission to “eliminate discrimination” – and businesses accused of that offense.

Not surprisingly, the BOLI found all eleven “aggrieved persons” to “credible witnesses and the forum has credited their testimony in its entirety.” That testimony consisted entirely of impassioned assertions of subjective “injury.” Penner's testimony was deemed “not credible,” “exaggerated,” and “disingenuous,” and credited “only … when it was undisputed or corroborated by other creditable evidence.”

Unlike the conga line of sobbing pseudo-victims, Penner documented real, quantifiable injury in the form of steadily declining sales receipts. He also produced testimony from witnesses confirming that his business was suffering as a result of the growing perception that it had become a limited-interest establishment catering to sexual minorities. If the victim hierarchy had been arranged differently, a sufficiently inventive attorney might have said that by taking control of the club on Friday nights the T-Girls had created a “hostile environment” for the “cis-gendered.” 

 

The testimony of another witness that Penner had been supportive of “diversity” was disallowed as impermissible “character evidence” on his behalf. Acknowledging that Penner's business policies were non-discriminatory would clutter the straightforward narrative in which he was presented as an incorrigible bigot, and the T-Girls as traumatized victims whose souls had been shattered by his pitiless prejudices. 

 

Predictably, the BOLI's extravagant awards for “emotional damages” are apparently illegal. An analysis produced by the Center for American Progress – which previously employed Shannon Minter, the BOLI's “expert witness” in this case – points out that "A successful complainant in an administrative hearing under the Oregon Equality Act is limited to recovery of actual damages and equitable relief. But a successful plaintiff in a civil action can receive compensatory damages, punitive damages, and attorneys’ fees. There are no caps on damages under the Oregon Equality Act.” (Emphasis added.) 

 

The BOLI, once again, is an administrative entity, not a judicial one. It cannot rule on civil actions. Litigants who complain about discrimination “may only receive punitive damages if they have filed their complaint in court instead of the corresponding administrative agency,” points out the CAP's analysis. 

Acting propio motu, Avakian has, in effect, created a new class of tort in which hurt feelings can justify damage awards in any amount the BOLI considers suitable. The pre-emptive seizure of Penner's accounts created a precedent for extra-judicial enforcement of the BOLI's spurious damage awards. 

 

The BOLI's definition of “law” is as fluid as the sexual identity claimed by Penner's supposed victims. The convergence of ala carte sexuality and self-defined administrative power has produced an uncommonly pure variety of despotism – backed, at least in Portland, by one of the most violent and reform-resistant police departments in the American soyuz. 

 

“From the start of this,” Penner ruefully recalls, “three different lawyers from three different law firms said that no one ever wins against BOLI.” 

 

Chris Penner and the Kleins have little in common apart from being small business owners targeted by Avakian and his comrades. They and other Oregon entrepreneurs confront the prospect of exile or annihilation unless they can destroy the BOLI root and branch. 

Last February, I did a Freedom Zealot Podcast examining the Chris Penner story. Click here to download or listen to that program.  

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Dum spiro, pugno!