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Taco Bell

A franchise company is suing the city of Madison over its denial of a liquor license for a Taco Bell Cantina on State Street.

A restaurant franchise company is suing Madison, the City Council and Mayor Paul Soglin over his decision to veto a liquor license for a Taco Bell Cantina on State Street.

Bell Great Lakes LLC filed the lawsuit Friday in Dane County Circuit Court, arguing the decision by Soglin to reject a beer and wine license for the fast-food restaurant and the council’s inability to overturn his veto were “arbitrary, capricious, discriminatory and unreasonable.”

Soglin vetoed the license for the restaurant at 534 State St. in December, arguing it would add to alcohol-fueled violence in the Downtown area. The license would have let Taco Bell Cantina serve beer and wine until 11 p.m. on Friday and Saturday and until 10 p.m. Sunday through Thursday.

On Jan. 16, the City Council voted 12-7 in favor of overturning the veto, short of the 14 votes needed for an override.

“The city’s denial of Bell’s license application as a whole was arbitrary, oppressive, discriminatory and unreasonable, and represented its will and not its judgment,” the lawsuit said.

Assistant city attorney Jennifer Zilavy declined to comment on the lawsuit Monday.

In its denial letter, the city said the license “would have adverse effects on public health, safety and welfare because this business is located in an area of high density for alcohol licenses.”

Bell Great Lakes, which is owned by San Francisco-based Flynn Restaurant Group, also alleges the mayor and council acted unfairly in approving a license with identical restrictions as those sought by the Taco Bell Cantina soon after the fast-food restaurant was denied.

On Feb. 6, the council approved a beer and wine license for Chen’s Dumpling House at 505 State St. — the same block as the Taco Bell Cantina.

According to the lawsuit, Soglin’s decision not to veto the Chen’s license “was the result of impermissibly applying a different standard.”

“The city’s approval of the Chen’s application proves that there is no evidence or rational basis for the finding that granting Bell’s license application would undermine public safety,” the lawsuit said.

At the Feb. 6 City Council meeting, Soglin said he didn’t object to Chen’s serving alcohol since the previous restaurant at the site held a liquor license and the new license would not add to the overall availability of alcohol Downtown. But the Taco Bell site had not previously had a liquor license.

The council overturned vetoes of a beer license for Mad City Frites, 320 State St., in 2015 and a beer and wine license for Lotsa Stone Fired Pizza, 506 State St., in 2016. By failing to override the mayor in the Taco Bell case, the lawsuit argued, the council acted in a “arbitrary, capricious and unreasonable” manner.

The lawsuit alleges the city failed to apply its policy that restricts new taverns or brewpubs in the area around the Taco Bell Cantina, but allows for businesses that primarily serve food to get a liquor license.

Bell Great Lakes is seeking to be granted the liquor license the City Council originally approved in December and “recoverable costs and disbursements.”

Taco Bell Cantina differs from regular Taco Bell restaurants in its decor, food offerings and the availability of alcohol.

Greg Flynn, the founder, CEO and chairman of Flynn Restaurant Group, said it is “very regrettable” that the issue had reached the point of litigation, but said a liquor license is needed to make the location successful.

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Logan Wroge has been a general assignment reporter for the Wisconsin State Journal since 2015.