A fight of Mythical proportions

  • Article by: CHRIS HAVENS and DAVID PHELPS , Star Tribune staff writers
  • Updated: August 24, 2009 - 11:13 PM

Court documents show that the now-shuttered Myth nightclub and its owner owe about $16 million. Multiple suits have been filed.

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Myth Nightclub

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The two men behind Myth, the Maplewood nightclub that closed last week, are locked in a dispute over control of the club, and creditors have filed court documents demanding more than $16 million. The developments cast doubt over the owner's intention to reopen the club soon.

The legal actions include a foreclosure notice on the building and court-ordered judgments of more than $3.3 million, according to documents filed in Ramsey County District Court. At least five lawsuits have been filed since July 1.

Myth founder Michael Ogren said he owns the building and controls the nightclub's business. He said that last month he began leasing the club to a group that said it intended to buy it later. After it stopped paying the club's bills, Ogren said, he evicted the group on Wednesday. He has said that he intends to reopen Sept. 1 and that he's looking to sell the club.

The foreclosure action didn't close Myth, Ogren said Monday. "Myth closed because the previous tenants were evicted for not paying bills. Like others in the economy, I'm trying to negotiate with lenders," he said.

Steven Sadowski, the potential buyer, disagreed.

"That's not even remotely close to the truth," he said.

Sadowski said that he took control in July of the business that operates the venue and does not have any responsibilities for Ogren's debt.

Sadowski closed Myth, he said, because there wasn't enough money to keep it operating and he didn't want to take on Ogren's liabilities. He originally was trying to recoup more than $3 million of a loan he made to Ogren for a defunct gambling website. Ogren offered Sadowski 10,000 shares of the business that controls the club as collateral, and Sadowski said he exercised an option to take control but not purchase the shares.

Many lawsuits

Ogren filed suit late Monday against Sadowski.

Sadowski had not seen the suit, but said he will sue Ogren.

Ogren's biggest money problem appears to be a $6.8 million mortgage for the Myth property that, according to court records, has been in default since March 1. Oregon-based StanCorp Mortgage Investors said it and other creditors are owed $6.8 million from a $7 million loan made to Ogren and his interests in 2007. The suit was filed July 31.

StanCorp is seeking court approval to foreclose on the property. The lender also wants a judgment of $6.8 million against Ogren.

A lawsuit filed Aug. 3 by Lake Region Bank, which has branches in Willmar and New London, is seeking $492,000 owed on an equipment lease contract and the return of the equipment. Ogren and Club Rage are the named defendants in the lawsuit.

And in another suit, Patriot Bank of Wyoming is seeking to retrieve $3.2 million in delinquent notes.

Ogren also is in default on a $500,000 promissory note from Twin Cities businessman Michael McGrath. That suit was filed Feb. 12 and asserts that, with interest, the amount owed is $568,876. A Feb. 20 judgment said Ogren owes $574,000.

McGrath filed another suit July 31 seeking $2.6 million. A judgment entered Aug. 17 said Ogren owes $2.8 million.

McGrath and businessman David Kloeber Jr. asserted in a lawsuit filed July 6 that Ogren owes $1.1 million on another promissory note.

Myth opened in August 2005 in a former Just for Feet shoe store near the Maplewood Mall. It has programmed mostly high-selling rock and rap acts, including Motley Crue, Marilyn Manson, Ludacris and Nas.

The club does not have any live acts scheduled until a Snow Patrol show Sept. 10. Sadowski said that show could be in jeopardy. Regina Spektor's show, scheduled for Sept. 11, has been moved to the State Theatre in Minneapolis.

Staff writer Tom Horgen contributed to this report. chavens@startribune.com • 612-673-4148 dphelps@startribune.com • 612-673-7269

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