The real problem,” Steve Rubell admitted, ”was that I did do what they accused me of” — namely evading taxes on Studio 54, the New York discotheque that Rubell and partner Ian Schrager had turned into the swankiest symbol of late-’70s excess. When the two were sentenced on Jan. 18, 1980, it was the beginning of the end for the disco era.
For 32 months, though, starting with the club’s opening in 1977, Studio 54 had been the mecca for the hip and fashionable and a slew of wannabes. Aided by burly bouncers, the diminutive Rubell often presided over the velvet rope outside Studio 54’s entrance, which separated the chosen from the frozen. ”It was a dictatorship at the door and democracy on the floor,” said Andy Warhol, who, with Bianca Jagger, Liza Minnelli, and Halston, made up the club’s ”Four Horsemen of Fame.”
Rubell once bragged that ”only the Mafia does better” than Studio 54 — not the most prudent statement, since he and Schrager paid only $8,000 in taxes in 1977. And in a raid on Dec. 14, 1978, federal agents reportedly found $600,000 in garbage bags stuffed into the club’s basement ceiling. There was also a second set of account books that listed ”party favors” for high-profile guests. The favors were generally in the $80 range — the price of a gram of cocaine.
Rubell, 36, and Schrager, 32, were each fined $20,000 and sentenced to 3 1/2 years in prison, later reduced to 20 months when they cooperated in investigations against other crooked club owners. As for Studio 54, it limped along for a while after its founders sold it. The venue itself has changed hands, becoming other nightspots, such as the Ritz and, recently, another Studio 54, which closed this month.
Meanwhile, Rubell and Schrager prospered anew, turning a reported $600,000 investment in three Manhattan hotels into an estimated $200 million empire in five years. ”Does the American system really work?” crowed Schrager, who stills heads up the hotel venture. ”Well, look at what we did.”
Reflecting on their first triumph, Rubell once said, ”A club is about capturing a moment in time…Not a very long moment, either.” Rubell’s own time was short. He died of complications from hepatitis in 1989. Schrager denied that his partner had had AIDS, but the virus did strike many of Studio 54’s habitues, including Halston. ”Half the people who used to be there are dead,” said Carmen D’Alessio, a celebrity recruiter for the disco of all discos.
That was not how this intoxicating moment was supposed to end.
Jan. 18, 1980
As Star Trek: The Motion Picture hit the new decade at warp speed, The Incredible Hulk ruled television, Michael Jackson wanted to ”Rock With You,” and John le Carre’s Smiley’s People topped best-seller lists.