East Hampton Town officials and the Surf Lodge, a popular Montauk summer nightspot, agreed to a $100,000 settlement in East Hampton Town Justice Court on Monday, finally closing the book on hundreds of Town Code violations the business racked up during its operations last season.
Attorneys for the Surf Lodge and town attorneys agreed that the business would plead guilty to 100 of the nearly 700 charges leveled against it and pay a fine of $1,000 for each guilty plea.
The violations stem from the business’s site plan, illegal clearing of wetlands, overcrowding and other categories, according to Assistant Town Attorney Robert Connelly. East Hampton Town Justice Cathy Cahill presided over the case.
The settlement offer was the same one that town attorneys extended to the business back in October, said Mr. Connelly.
The Surf Lodge was represented by attorneys Thomas Horn and Richard Hammer. Assistant Town Attorney Patrick Gunn and Mr. Connelly represented the town.
Talks of a settlement have circulated since at least October, when Mr. Connelly first proposed one in court, but the case then took several twists and turns. In March, the Surf Lodge hired a new attorney, Thomas Horn, to replace former attorney Colin Patrick Astarita. Last month, Mr. Horn filed a motion to dismiss many of the alleged violations against the business. Not long after that, news broke that the Surf Lodge was purchased by Montauk Properties LLC.
Mr. Hammer said he represents Montauk Properties LLC, the entity that recently purchased the Surf Lodge from Edgemere Montauk LLC late last month. Montauk Properties LLC, an investment company focused on real estate and hospitality investments, is managed by Michael Walrath, who owns a home in Montauk. Mr. Walrath also recently purchased Lenny’s On the Dock in Montauk this past winter with his partner, James Tchinnis. The new business will be called Swallow East—named in part after Mr. Walwrath’s restaurant in Huntington Village called Swallow. Swallow East will be open this summer.
After the court proceeding, Mr. Gunn, who is also the town’s public safety division administrator, called the settlement the “largest” case enforced by the town’s Ordinance Enforcement Department and the “largest fine” achieved by the Town Attorney’s Department.
Mr. Gunn also spoke positively of the new management and said they have been “proactive” with the town. “The new season’s starting,” Mr. Gunn said. “We’re happy this is behind us.”
Surf Lodge will be open on Friday, May 25. Jayma Cardoso, an original owner of the Surf Lodge, will remain in the mix. She will be a managing partner in the business. In a recent interview, she said the business plans to scale its Friday and Saturday hours back, from closing at 4 a.m. to closing at 2 a.m. The establishment also plans to shut down around 11 p.m. from Sunday through Thursday.
East Hampton Town Councilman Dominick Stanzione, the Town Board liaison to the hamlet of Montauk, lauded the success in court, and said the town’s legal team “should be proud” of the work they accomplished.
“I think it’s an outstanding example of our judicial system working through complex issues,” Mr. Stanzione said. “I am proud with the outcome of that litigation.”