The "fat toad", 39, was arrested in the bar in Osaka at 5:30 am.
Irabu admitted that he had drunk around 20 "jugs" of beer and was upset when the machine did not read his credit card.
"I-Robbed-U" grabbed the bar's 22-year-old manager by the collar, pushed him against the wall and "yank"ed his hair, the police said. He also threw ashtrays and beer bottles.
George Steinbrenner once called Irabu a "fat toad" for failing to cover first base during a play in a spring training game.
In the Yanks 1999 traded him off to the Montreal Expos in exchange for Jake Westbrook, Ted Lilly and Christian Parker.
Irabu went 34-35 with a 5.15 ERA in six seasons with the Yanks, Expos and Rangers. He returned to Japan in 2004 and pitched for the Hanshin Tigers.