Josephson created the club to showcase African American talent and to be an American version of the political cabarets he had seen in Europe earlier. As well as running the first racially integrated night club in the United States, Josephson also intended the club to defy the pretensions of the rich; he chose the name to mock Clare Boothe Luce and what she referred to as "café society," the habitués of more upscale nightclubs, and the wry satirical note was carried through in murals. Josephson not only trademarked the name, which had not been trademarked by the gossip columnist for the New York Journal American M, who wrote as the first "Cholly Knickerbocker," but advertised the club as "The Wrong Place for the Right People." Josephson opened a second branch on 58th Street, between Lexington and Park Avenue, in 1940. After that the original club was known as Cafe Society Downtown and the new club - designed for a different audience - as Cafe Society Uptown.
The club also prided itself on treating black and white customers equally, unlike many venues, such as the Cotton Club, that featured black performers but barred black customers except for prominent blacks in the entertainment industry. The club featured many of the greatest black musicians of the day, from a wide range of backgrounds, often presented with a strongly political bent. Lena Horne was persuaded to stop singing "When it's Sleepy Time Down South", Pearl Bailey was fired for being "too much of an Uncle Tom", and Carol Channing was fired for an impersonation of Ethel Waters. Billie Holiday first sang "Strange Fruit" there; at Josephson's insistence, she closed her set with this song, leaving the stage without taking any encores, so that the audience would be left to think about the meaning of the song.
Relying on the keen musical judgment of John Hammond, the club's "unofficial music director". Josephson helped launch the careers of Lena Horne, Sarah Vaughan, Big Joe Turner, Ruth Brown, dancer Pearl Primus, and Hazel Scott and popularized gospel groups such as the Golden Gate Quartet and the Dixie Hummingbirds among white audiences. Many of these acts had first been presented at Hammond's Carnegie Hall concerts, From Spirituals to Swing, in 1938 and 1939.
As part of the challenge to integrate America's segregated society, Josephson's club was the scene of numerous political events and fundraisers, often for left-wing causes, both during and after World War II. In 1947 Josephson's brother Leon Josephson was subpoenaed by the House Committee on Un-American Activities, which led to hostile comments from columnists Westbrook Pegler and Walter Winchell. Business dropped sharply as a result and the club closed the following year.
- Sid Caesar
- Carol Channing
- Imogene Coca
- Betty Garrett
- Jack Gilford
- Buddy Hackett
- Danny Kaye
- Zero Mostel
- The Revuers (Judy Holliday, Betty Comden, Adolph Green, Alvin Hammer, and John Frank)
- Jimmy Savo
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- Many sources give the address at 2 Sheridan Square: "Barney Josephson, Owner of Cafe Society Jazz Club, Is Dead at 86", The New York Times; see history of "The theater at One Sheridan Square".
- William Robert Taylor, Inventing Times Square: commerce and culture at the crossroads of the world 1991:176
- His autobiographical, Cafe Society: The Wrong Place for the Right People, written with Terry Trilling-Josephson, was published in 2009.
- Taylor 1991:176.
- Taylor 1991:176.