New owner of embattled Alibi restaurant in Lakeville withdraws liquor license application

The Lakeville bar owner whose business became a flash point when she opened her doors this winter despite pandemic restrictions says she plans to leave Minnesota.

It's the latest — and possibly last — chapter in a saga that began in December when Lisa Zarza, who owned Alibi bar and restaurants in Lakeville and Northfield with partner Ricardo Baldazo, repeatedly opened the tavern to crowds of maskless customers despite state orders intended to curb the spread of COVID-19.

Alibi was one of more than 100 businesses in the state that pledged to reopen in defiance of state restrictions at a time when new daily COVID infections in Minnesota numbered in the thousands. Those business owners — and the customers who turned out en masse to support them — said Gov. Tim Walz had overstepped his bounds by prohibiting on-site dining at bars and restaurants.

Six months, thousands of dollars in fines and multiple legal actions later, Zarza has sold both Alibi locations. On Tuesday, the new Lakeville owner's effort to obtain a liquor license fell apart after city officials discovered the Alibi lease agreement said Zarza and Baldazo would actually be running the restaurant. The new owner rescinded his application.

A tearful Zarza told the City Council she was simply trying to sell her business. "I don't want to be in this community anymore," she said.

In June, Lakeville resident Jose Colon told the City Council that he was Alibi's new owner and was making payments to Zarza and Baldazo toward its purchase. Colon said he planned to hire Alibi's previous manager to help run the place and would retain Baldazo and Zarza as paid consultants.

But according to a city memo, Lakeville officials found that Colon's new lease agreement says Zarza and Baldazo, not Colon, would operate the restaurant.

Colon made "misleading and inconsistent statements" concerning the pair's involvement in running Alibi, the memo said, and he may have been only a proxy to obtain the license because Zarza and Baldazo couldn't get one themselves because of noncompliance with the governor's executive order.

At Tuesday's meeting, every council member expressed reservations about granting Colon the license. Colon said he felt he was being judged because of the previous owners' actions and his relationship to them.

"I'm not here to try to trick you guys," he said. "I want to run a successful business."

Colon said he tried to change the lease to omit Zarza and Baldazo's roles as operators of Alibi, but Metro Equity Management, a commercial real estate company, wouldn't let him have the lease alone because of his lack of experience in the restaurant business.

Council Member Michelle Volk said she supported Zarza's right to fight against the executive order but thought Colon hadn't been honest with the council. Council members Joshua Lee and John Bermel said their issue was with the license application, which states that any falsification of answers will result in a denial.

"There's too many holes for me to approve your application," Lee said.

Mayor Doug Anderson said Colon could reapply for the license "with different circumstances." Colon rescinded his application, and Volk said she would help him reapply.

Thirty people attended Tuesday's meeting, and several spoke in support of Colon. Shouts of "Just let him have it!" and "You work for this community!" rang out while council members spoke. Anderson told the hecklers they were out of order.

Colon previously said he planned to get the liquor license from Lakeville and then pursue a food and beverage license from the state.

In an interview Wednesday, Zarza said she had planned to train Colon but was never going to run the restaurant. She said she's not certain what will happen with the sale if Colon can't obtain the licenses, because securing them is a condition of the purchase agreement and his lease.

"We'll have to cross that bridge when we get to it," she said.

Zarza said the state Health Department hadn't found any COVID-19 cases associated with the Lakeville Alibi location. The department confirmed it hadn't identified any outbreaks but said eight people reported visiting during their exposure period.

Meanwhile, Zarza said she plans to move to Republican-led "red Texas" and eventually sue the state of Minnesota.

But knowing what she knows now about the consequences of flouting state restrictions, Zarza said she is unsure whether she would do it again.

"Would I fight for our rights?" she said. "I don't know."

Erin Adler • 612-673-1781