The State Theatre opened in 1926 for the Loew’s Theatre circuit. On opening day, Marcus Loew appeared on stage with many of the silent film stars of the 1920s including Buster Keaton, Jack Mulhall, and Dorothy Mackaill. The State Theatre was constructed at a cost of $1 million and was designed by prominent New York architect Thomas W. Lamb. Lamb was instrumental in establishing and developing the design and construction of large theatres known as movie palaces for the early Hollywood studios.
By merging Metro Pictures, Goldwyn Pictures, and Louis B. Mayer Productions, Marcus Loew founded MGM in 1924 to provide films for his theaters. Loew’s Inc. served as the parent company and the distribution arm for MGM until anti-trust laws forced them to separate. The two companies did not officially split until 1959.
When the Brunet Company assumed the operation of the theater, the auditorium was returned to a single screen. The adjoining commercial spaces were remodeled and connected to the theatre’s main lobby, creating a large entertainment complex. The renovation also changed the name of the theater to the State Palace Theatre.
The first raves were held at the State Palace in 1995. The crowds numbered in the hundreds but quickly grew to the thousands. The rave parties became nationally known for their bizarre themes and attractions. Some of which included; a dance contest hosted by the late Fred Berry (the character Rerun from the tv show What’s Happening!!), a surprise performance from 2 Live Crew, a puppet show by local act Quintron and a traditional Mardi Gras second line by Rebirth Brass Band. During one party, the group Crash Worship led a thundering drum-processional that included a naked woman soaked in wine. Another time, the promoter turned on the house lights at 3:00 A.M. to a choir singing Amazing Grace.
In 1998, tragedy struck as a 17-year-old girl suffered convulsions from drug complications at a State Palace rave. She passed away after lying in a coma for several days. After the girl’s death, federal agents made an unannounced visit to the promoter’s home and questioned him about his involvement with drug dealing at the State Palace.
By 1999, the mainstream media was saturated with coverage of raves as drug-fueled death traps in response to the Drug Enforcement Agency’s “Club Drug Campaign”. The promoter and owner of the State Palace were unaware they were the subject of a national investigation of rave parties and the club drugs associated with them.
On August 26, 2000, the rave parties came to an abrupt halt. Hours before a party was set to begin, the New Orleans Police Department sealed off the theater’s entrance, leaving thousands of patrons wandering the sidewalks. Federal agents searched the building until the early morning hours. They seized files, computers, party favors, and even cases of bottled water. The agents found virtually no drugs inside of the building and no proof that the promoter or owner had any involvement in drug dealing.
Although there were no drugs found, the owner and promoter were indicted under federal grand jury charges of violation of the ‘crackhouse statute’, a charge that carried a possible prison sentence of 20 years to life. The federal statute makes it a felony to knowingly open, lease, rent, use, or maintain any place for the purpose of manufacturing or using any controlled substance. This indictment was the first time the federal government used the law to indict a venue manager and promoter for drug dealing, rather than charging the dealers and consumers themselves.
A search warrant stated undercover DEA agents observed rampant drug dealing and consumption of LSD and ecstasy that security nor management did anything to curtail. Furthermore, the warrant also stated the venue sold glow sticks, bottled water, pacifiers; all said to enhance the effects of ecstasy. During a party on March 4, 2000, undercover agents made 25 purchases of controlled substances within an hour, averaging one every four minutes.
Eventually, the promoter decided to not plead guilty to any charges or accept any plea that would be offered. He believed shutting down the rave parties would do little to protect children from the dangers of street drugs. With a new attorney and help from the Civil Liberties Union’s Drug Policy Litigation Project, he decided to fight the charges.
In 2001, the charges against the promoter were dropped. A second case charged the owners with conspiracy to violate the ‘crackhouse statute.’ A guilty plea was accepted by a Judge and the owners paid a $100,000 fine and agreed to ban anything that could be considered drug paraphernalia.
The State Palace closed for a short time in 2005 after the basement flooded from the aftermath of Hurricane Katrina. Two years later, the theater closed permanently due to fire code violations.
There have been attempts to revive the State Palace in recent years, however, nothing has materialized. In 2014, the theater was sold to local commercial real estate developer Gregor Fox for $3.5 million. Fox’s plan was to renovate and put the theater back in commercial use. After he discovered the renovation would cost upwards of $40 million, Fox decided to sell the State Palace a year later. Another developer, LC Hospitality Group, bought the theater from Fox in 2015. In 2018, the new developer submitted two different proposals for renovation. Both proposals were denied and the State Palace remains shuttered.