A Ramsey County judge found the owner of The Iron Waffle Coffee Co. in contempt of court Tuesday, June 22, after she repeatedly opened her Lake Shore business without a license.

The order from Judge John H. Guthmann also imposed a $2,000 per day fine effective immediately, should owner Stacy Stranne continue to serve customers at the establishment despite the revocation of her food and beverage license in response to documented violations of Gov. Tim Walz’s pandemic-driven executive orders.

“My findings here are that the order requiring the restaurant to stay closed was violated,” Guthmann said during the virtual court hearing. “It’s not even disputed that my order has been violated or that the restaurant is in contempt of court.”

The Iron Waffle Coffee Co. in Lake Shore Friday, June 11, 2021. Steve Kohls / Brainerd Dispatch
The Iron Waffle Coffee Co. in Lake Shore Friday, June 11, 2021. Steve Kohls / Brainerd Dispatch

The latest action comes after an expedited motion filed by the Minnesota Attorney General’s Office on behalf of the Minnesota Department of Health, seeking the order for contempt as part of a civil lawsuit against Iron Waffle first initiated in December 2020. The lawsuit was the next step at the time after months of inspections, fines and other administrative actions failed to prevent the business from disobeying executive orders concerning mask usage and takeout requirements while continuing operation. Before Tuesday’s hearing, Guthmann on May 18 granted a state motion for a temporary injunction, which sought to prevent Iron Waffle from operating without its license first revoked in December.

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The state supported its contempt motion Tuesday with an affidavit from a health department sanitarian, who reported he’d inspected Iron Waffle six times between June 9-15 and found it illegally operating on all occasions. The inspections were prompted by a complaint to the health department received June 7.

Reached by phone June 11 to discuss the ongoing case before the latest state motion, Attorney Richard Dahl, representing Stranne, said he did not want to discuss the case and said his clients could respond if they wished.

“The state is looking for an excuse to do something to my client,” Dahl said. “I’m not gonna give you one.”

Reached the same evening, Iron Waffle co-owner Jeremiah Duvall said he’d lost interest in the legal proceedings because he feels they are deeply unfair.

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“We really don’t have any civil liberties anymore. I guess I’ll just live my life the way I want to live my life and they can live their life the way they want to live their life,” Duvall said. “ … I just think that it’s random and they just kind of make things up as they go. So I’ve kind of given up on the whole thing.”

Arguments

Dahl argued for dismissal of the lawsuit entirely. He said because Walz rescinded both executive orders Stranne is accused of violating — the mask mandate, which ended May 14, and the order last autumn requiring restaurants and bars to offer only takeout for at least a four-week period as COVID-19 cases saw a dramatic rise in the state — the health department lacked the authority to continue the suspension of Iron Waffle’s license. Dahl further argued Walz’s executive orders never asserted the right to revoke a license for a violation and state law also does not grant that authority, which he said means the licensing action was improper in the first place.


“I think this has been an unfair proceeding from the beginning. … You’re supposed to decide the law. It was your opportunity to say, ‘I don’t think you served them properly.’ "

— Richard Dahl, attorney


Dahl said Stranne is in the process of selling the business and is just trying to make a living — the state should consider those circumstances, he said, but instead was unwilling to reach a settlement agreement while taking a “hard line.”

“I don’t think she’s in contempt in the way that the state would make it appear,” Dahl said. “ … We have a fair chance of prevailing in the appellate court or the Supreme Court, given the governor’s orders have been revoked.”

Beyond questioning the state government and governor’s authority in the matter, Dahl also cast doubt on the validity of the science behind COVID-19 in a number of filings. In the defendant’s Thursday response to the state’s motion seeking a contempt order, Dahl cited a New England Journal of Medicine editorial co-authored by Dr. Anthony Fauci printed March 26, 2020. The authors speculated on the potential clinical consequences of the disease being “more akin to those of a severe seasonal influenza … rather than a disease similar to SARS or MERS.”

“Furthermore, it is clear that the entire alleged Pandemic was a fraud as Dr. Fauci admitted in an article,” Dahl wrote in the response.

Despite Dahl’s characterization, Fauci made no such admission in the editorial printed less than two weeks after former President Donald Trump first declared a national emergency. At the time, there were 119,696 reported cases and 1,868 total deaths in the U.S., according to the Centers for Disease Control and Prevention. As of Sunday, those figures now stand at 33,368,860 cases and 599,354 deaths.

RELATED: After repeated violations, state suspends license of Lake Shore restaurant

Assistant Attorney General Kaitrin Vohs responded to Dahl’s arguments, noting attempts to question the validity of the orders or whether the license revocation was proper were not at issue in Tuesday’s hearing. Vohs said even if they were, the validity of the executive orders were already upheld by rulings of the Office of Administrative Hearings. Vohs noted Stranne could apply for another license and if rejected based on previous behavior, would have the chance to appeal the decision and raise issues related to the revocation then.

In arguing for a higher fine than the typical $50 per day, Vohs noted a “persistent pattern of violations in this case” and pointed to the fact Stranne earned income by opening the restaurant while unlicensed.

Judge weighs in

Guthmann said although not part of the matter before him, Dahl’s interpretation of state law was incorrect in his view and Walz’s orders were enforceable in the form of license revocations. The more relevant issue, the judge said, was the fact Iron Waffle failed to appeal the licensing action within the administrative process provided for by law.

“Iron Waffle chose not to appeal the decision of its license, and therefore gave up the right to attack the underlying validity of the authority the department used to revoke the license in the first place,” Guthmann said. “ … Frankly, there has been no argument or representation to this court as to why they didn’t do that. They could already be at the Court of Appeals. I don’t have any jurisdiction to review the underlying decisions of the department to revoke the license. … None of that really matters here. It’s a very simple case of a restaurant operating without a license.”

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Dahl said Stranne had no opportunity to appeal the licensing decision because she was not properly served notice and could not take action within the allowed time frame. He argued Guthmann should not have issued an ex parte temporary restraining order in December because of the lack of proper notice of the licensing action. An “ex parte” order is one entered without notice to either party.

“And then you say to me that that’s their fault?” Dahl said. “I think that’s absurd and ridiculous.”


"I don’t have any jurisdiction to review the underlying decisions of the department to revoke the license. … None of that really matters here. It’s a very simple case of a restaurant operating without a license."

— Judge John H. Guthmann


Dahl said if the state properly noticed Stranne, they would have learned two Iron Waffle employees were exempt from the mask order due to diagnoses of epilepsy.

Guthmann said state law requires notice by mail, but not notice in person. In this case, when Stranne failed to respond to notice by mail, she was personally served as well, the judge said.

“If you truly believed your client should’ve been personally served … you would’ve at least had an administrative forum, which is the proper forum,” Guthmann said.

Dahl called the judge’s position “disingenuous” and accused Guthmann of “basically copying the state’s briefs.”

“Either way my client goes, we’re wrong,” Dahl said. “ … I think this has been an unfair proceeding from the beginning. … You’re supposed to decide the law. It was your opportunity to say, ‘I don’t think you served them properly.’ … You just copped out and you didn’t decide the issue. And now you’re blaming it on me and my client.”

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After going back and forth with Guthmann on the issue for a few more minutes, Dahl concluded by threatening to sue the state over abuse of process.

“They use snitches to do this,” Dahl said. “This is the grossest display of an abuse of power that I’ve ever seen in Minnesota history, what they’ve been doing to restaurants and bars.”

Before issuing the contempt order, Guthmann again pointed out Stranne chose not to appeal in the proper forum.

“I have to rule on the case that I get, not some hypothetical case,” Guthmann said.

Poston responds

Included in the state’s expedited filing were June emails exchanged between Vohs and Dahl, in which Vohs asked Dahl for confirmation his client would discontinue operating Iron Waffle without the required license. In response, Dahl did not acknowledge the state’s query and instead replied, “My understanding was that it was sold to Representative (John) Poston or to another entity or was in the process of the same. I will confirm this weekend.”

Poston, R-Lake Shore, is a business partner in 3 Cheers Hospitality, which owns a catering business and several lakes area restaurants including Prairie Bay Restaurant in Baxter and Sherwood Forest, which is located on the same property as Iron Waffle in Lake Shore.

Reached by phone Tuesday, Poston said 3 Cheers owns the property and Stranne leases the space. He said he spoke with Stranne several months ago to let her know they’d be interested should she decide to sell, but no further discussion took place since and it did not go beyond showing interest.


“ … My partner and our team has done a great job of weathering the storm, so to speak, getting us through the last 15 months. You know, we have complied with everything. And it’s not been easy.”

— Rep. John Poston, R-Lake Shore


“We’ve had some conversation very much in passing, if you will,” Poston said. “Stacy (Stranne) has kept up with all of her obligations on her lease. So, you know, my position on this has always been, it’s her business and as long as she’s current on her lease, then I’m not going to interfere. Or I shouldn’t interfere. It’s her business. … I don’t know anything at all about her legal issues.”

John Poston. Submitted Photo
John Poston. Submitted Photo

As for Poston’s position on amnesty for executive order rule-breakers — a potential measure raised as part of the Minnesota Legislature’s latest special session — he said he falls somewhere in the middle on whether it should be granted. He said he’s heard stories from small business owners who made a small mistake and are paying big for it, potentially headed toward bankruptcy because of the punitive response.

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“The way you have to look at this is if the owner made a mistake, do we want to penalize everybody that’s part of that economic engine?” Poston said. “Do we want people to lose their jobs? Do we want the landlord to not get paid? Do we want suppliers to not get orders?”

But Poston said there are others who were more flagrant in their violations, and still others who took economic hits because they strove to comply with the COVID-19 orders.

“We’ve been through a really difficult last 15 months. We’ve been open, then we’ve been closed, and then we’ve been partially open,” Poston said. “ … My partner and our team has done a great job of weathering the storm, so to speak, getting us through the last 15 months. You know, we have complied with everything. And it’s not been easy.”



CHELSEY PERKINS may be reached at 218-855-5874 or chelsey.perkins@brainerddispatch.com. Follow on Twitter at twitter.com/DispatchChelsey.