In September, American Musical Theatre of San Jose threw a big, raunchy party for the ladies—a tuneful strip show known as The Full Monty. The audience, reported Metro’s critic, was full of white-haired ladies “snorting, choking [with] tear-inducing laughter.” There were tears but no laughter this Monday as AMT suddenly announced that it was going out of business. The company, which began life in 1935 (during another economic meltdown) as the San Jose Civic Light Opera, was no more.

The trouble began when Theater of the Stars in Atlanta, co-producers with AMT and Dallas Summer Musicals of a reworked version of Disney’s Tarzan, pulled the plug on the new musical. AMT and Dallas Summer Musicals, which had ponied up $225,000 each for the show, were left high and dry. In addition, Michael Miller of AMT estimates that the loss extends to $800,000 in already-sold tickets. The total shortfall, including anticipated sales for the February show, could be much higher.

AMT and Dallas Summer Musicals are already pursuing legal options against the Atlanta outfit, which offered only the excuse that it was spending the money on a different production. Dallas’ attorneys “are locked with our attorneys,” said Miller. AMT’s CFO, Robert Nazarenus, sternly blamed the situation on “the wanton actions of another theater company.”

Dianna Shuster, now with Pocket Opera in San Francisco, worked as an artistic director with AMT for more than 20 years before leaving in 2002. She said that the announcement “is a sad situation for the larger Bay Area theater community because AMT was a training ground for talent. It was a really special company. We built it from a community theater to one of the biggest musical theater companies in the country.” Shuster dates some of the problem to AMT’s decision in 2002 to join forces with the Nederlander Organization to mount more touring Broadway shows.

Reflecting on what the loss of AMT means to the area’s theater scene, Mark Nichols, managing director of San Jose Rep, said, “The loss of AMT goes far beyond the economic and cultural impact of not having six big musicals perform in downtown San Jose every year. AMT, like San Jose Rep, Opera San José, Ballet San Jose and other large performing arts companies, provides a myriad of services for fellow arts organizations. We build scenery, props, and costumes for smaller groups and we provide rehearsal space, furnish equipment and provide other goods and services for the arts community.”

This blow comes on top of a recent budget shortfall that drove AMT to ask for a loan of $1 million from the city of San Jose in 2006. AMT will file Chapter 7 bankruptcy papers later this week and will probably have a court-appointed trustee as early as next Monday. The city and the season-ticket-holders will have to stand in line as creditors as the trustee figures out how much the company’s assets are worth. AMT had 30 employees, a number that could swell to as many as 250 when a production was in full swing. The planned touring production of Chicago set for Jan. 14–18, should go on as previously announced; the fate of another touring show, Avenue Q, is still up in the air.