‘Jersey Shore’ Hotspot Karma Files for Bankruptcy

Even the stars of Jersey Shore and the publicity they bring couldn’t save one Seaside Heights, NJ party spot. Karma, which was regularly featured on the hard-partying MTV phenomenon, has filed for bankruptcy.

seaside heights
Seaside Heights Boardwalk (Photo by Kena Betancur/Getty Images)

Karma was heavily featured in the original Jersey Shore as a favorite nightspot of the cast of seven. Now, several years and several marriages away from its party heyday, Karma is in legal and financial trouble. The owners are scrambling to pull it together, but they are indeed facing an uphill battle.

Karma’s heyday

Karma was a well-established party spot long before the cast of Jersey Shore laid eyes on the fluorescent blue beachfront bar, but filming for Jersey Shore certainly made it famous. The establishment offered a variety of dance nights, specialty nights and themed parties for the adult vacationers who frequent the seaside borough.

The nightclub was cemented into popular culture in 2009 when Jersey Shore premiered on MTV. By the Summer of 2010, the nightclub was packed every night as young adults flocked to the storefront to catch a glimpse of the hard-partying cast of the show.

Karma, however, was dealt a heavy blow in 2012 when Hurricane Sandy decimated the region. They were once again in operation, but the borough refused filming permits in 2018 when Jersey Shore started its reboot. Now, the nightclub is embroiled in a legal battle with Seaside Heights, and it doesn’t look like they’ll be winning.

New Jersey moves to oust Karma

Seaside Heights, which was absolutely lambasted by Hurricane Sandy in 2012, has worked hard to rebuild its boardwalk which was largely destroyed. Previously the boardwalk featured a variety of shops and nightspots intended to bring in the 20-something crowd from the surrounding tri-state area.

Seaside Heights, however, is now moving in a different direction and has worked to clean up the boardwalk. With its new family-friendly initiative spots like Karma are no longer welcome. In May 2018 the borough attempted to shutter the club. According to borough code, businesses operating as nightclubs are not permitted on the boulevard.

According to The Philly Voice, Seaside Heights has a zoning code that requires any establishment serving alcohol to offer meals. Karma, which previously had a restaurant operating on its first floor, was operating, as of 2018, as only a nightclub. They, according to Jersey representatives, were in direct violation of liquor license laws.  Savor, the eatery that occupied the first floor of the club opted not to return for Summer 2018.

The battle continued through the summer of 2018 as liquor license hearings were pushed back, but eventually, Karma shuttered its doors for the winter. Now, the establishment is in even bigger trouble; they owe a lot of people a lot of money.

Karma files for bankruptcy

Karma recently filed for chapter 11 bankruptcy protection. The nightclub owners attest that they have less than $50,000 in assets, but owe several million dollars, according to TMZ. According to the court documents, the owners of the business owe the state of New Jersey over $2 million. Their bills for the state include fire safety violations and taxes. The documents also note that the business owes two banks more than $1 million. They are also on the hook for $20,000 to liqour vendors.

The company is free to continue operating through 2019, according to recent court documents, but Google reviews marks the establishment as permanently closed. The nightclub notoriously shuts down during the winter months, much like other establishments in the beachfront town. There is no word on whether it will return come Memorial Day.