Neighbor Takes Fight Over Gay Leather Bar's Liquor License to Court

Matthew Moody said he's poured nearly $500,000 into Barracks Bar Phoenix, the leather bar he plans to open on 7th Avenue in Phoenix's Melrose District. He took out a second mortgage on his home. He sold his vintage 1965 Fender Stratocaster. He has spent more than $68,000 on lawyers.

In July, after an eight-hour hearing, the Arizona State Liquor Board gave him what he needed: a Series 6 bar liquor license.

But the bar's opening — for now — is in limbo, in part because the owner of the building next door is now asking a judge to undo the process that gave Barracks Bar the license in the first place.

18 SAC, LLC, which is owned by Stuart Shoen — a member of one of Arizona's most famous families that started the moving company, U-Haul — filed an appeal in Maricopa County Superior Court on Aug. 17, asking the court to put the board's decision on hold and vacate the license. The company is the only formal protestor fighting it.

The appeal names both the liquor board and Barracks Bar Phoenix, Inc. as appellees, according to recent court records.

At the center of the appeal is Moody: 18 SAC argues there wasn't substantial evidence to support the board's finding that Moody is capable, qualified and reliable enough to hold the license, and that he never met his burden of proof.

Shoen's lawyers argue in the case that the board broke its own rules along the way. According to the filing, the company said the board unlawfully refused to let an independent administrative law judge hear the protest, denied 18 SAC procedural rights guaranteed to public protestors and allowed Moody to amend his application improperly.

The appeal also argues the board didn't use the correct legal standard when it turned down 18 SAC's subpoena requests, keeping the company from gathering evidence, and granted a provisional license it had no statutory authority to grant. In that hearing, the board claimed that they were not an entity that could issue subpoenas, or gather evidence in the same way a court might and denied Shoen's requests.

Shoen is asking for a trial de novo — essentially a reset of the liquor board's process — and for his attorney fees and costs.

In September, the court ordered 18 SAC to serve the liquor board with its appeal and file proof of service, file a notice of action and proof of compliance within 10 days, and pay to prepare and send over the board's administrative record.

The case was reassigned on Sept. 16, and the docket now lists Judge Michael Gottfried. The court docket shows that most recently a notice of appearance was filed on Oct. 21.

But much of the July 9 hearing that 18 SAC is fighting to correct wasn't about Moody, but his former business partner.

Richard "Scott" Murchison owned the original Barracks bar in Cathedral City, California. Between 2023 and 2024, after anonymous complaints, California's Department of Alcoholic Beverage Control ran a four-month undercover investigation there. It ended with 66 administrative allegations involving public sexual activity, outdoor nudity and displays of adult pornography. Murchison surrendered his license and closed the bar in 2024. Still, no criminal charges were filed.

When Moody first applied for the Phoenix license, corporate filings listed Murchison as a co-founder, director and 50% shareholder of Barracks Bar Phoenix, Inc. That connection led the Phoenix Police Department to recommend the license be denied.

On April 28, Moody and Murchison amended those filings to remove Murchison as an officer and director. Police then withdrew their objection, concluding there was no legal basis for denial. Neither the Phoenix City Council nor the Department of Liquor Licenses and Control protested.

But state records revealed at the hearing showed Murchison was still a 50% shareholder in Barracks Bar Phoenix Inc., and held a 50% interest in Manly Media Group LLC, the property's landlord. Michael Raine, 18 SAC and Shoen's lawyer, argued those stakes meant Murchison still had controlling influence over the bar.

Acting Board Chair Lynn Shulman said the board's job was to assess compliance, not to judge cultural norms. The board voted 5-1-1 to approve the license, with one strict condition: Moody has 90 days to complete a full legal transfer and buyout of Murchison's financial and shareholder interest. Records show that was completed by Moody, but the state licensing agency must review and approve it.

A trial has not yet been scheduled.