COURT ORDERS DANCE CLUB TO HAND IN ITS LICENSE

After nearly three years of attempts by various New York City agencies
to shut down a popular Chelsea nightclub, the Appellate Division of
the State Supreme Court yesterday ordered the club, Twilo, to hand
over its cabaret license, effectively putting it out of business.

Twilo, a club built in a former warehouse at 530 West 27th Street, has
been a target of law enforcement officials and the mayor's office
since late 1998, when the city, citing the drug overdose of a patron,
filed a lawsuit declaring the club a public nuisance. The city lost
that suit.

The city has since accused the club of operating as a veritable
supermarket of the drugs ecstasy and G.H.B., or gamma hydroxybutyrate.
Last July, a patron died from a drug overdose after collapsing on the
floor of the club; in October, ambulance workers responding to a 911
call from inside the club were denied entrance, Fire Department
officials have said. An eventual search of the club yielded three
revelers -- two unconscious and one semi-conscious -- who were later
treated for drug overdoses at St. Vincent's Manhattan Hospital. City
officials also noted that the club, like others in Manhattan, hired a
private ambulance to wait outside in case of drug overdoses by patrons.

Last year, the city refused to renew Twilo's cabaret license, but in
February the Supreme Court of New York determined that the city had no
basis for doing so and called the action "arbitrary, capricious and
unreasonable," according to court papers. Yesterday's decision
overturned that ruling.

"We are very disappointed," said Peter J. Sullivan, a lawyer for
Twilo. "We are very concerned that these very important issues for the
dance industry are not being addressed."

Twilo is an international center of electronic music, attracting
D.J.'s from around the world and large crowds each weekend. But the
club was shut down this month after the police and building inspectors
raided it and insisted that several building permits were missing or
invalid.