According to the TABC, Spire Nightclub was suspended on June 27 for 30 days for violations of social distancing rules found following an inspection.
Despite the name of the establishment, Spire Nightclub is not a "nightclub."
While the owners claimed they still followed the governor's orders, the TABC states the 51% rule didn't apply for social distancing.
The downtown hot spot came under fire after videos surfaced showing a crowd inside a day after Gov. Greg Abbott mandated bars and clubs close their doors to slow the spread of COVID-19.
Bret Hightower, a consultant, said Spire did not fall into either of those categories.
READ MORE: People crowd downtown club in wake of Gov. Abbott's orders
"Back in November of 2019, the main owner had come to the realization that he no longer owned a bar," Hightower said. "He owned a lounge/venue hall because most of the revenue was not coming from alcohol or liquor sales. It was coming from ticket sales, and then to be able to reserve your own private section."
You can watch ABC13 reporter Mycah Hatfield's full interview with Hightower above.
In June, Club Spire said they're not subject to the governor's order and even if they were, they say they did all they could to encourage social distancing. They added that it's on the customers to do a better job.
"We're as a business legally allowed to open. We're following the rules, we're doing everything," Hightower explained. "Sometimes people don't know they're putting themselves at risk. I feel like it's our job to be the bigger person and really force their hand to keep them safe."
Venues are considered a bar if they make more than 51% of their sales from alcohol. During the inspection, the Texas Alcoholic Beverage Commission confirmed to ABC13 that they believe Spire is considered a reception hall. While most of Spire's revenue this year has been from alcohol sales, the TABC confirms that the club can operate outside of the 51% law because permits are only reviewed every two years.
The video above is from a previous statement.