Matt Levine Sues DelShah Capital for $20M Over Nightlife Venues
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The tabloids are abuzz this morning with the latest news of the quarrel between restaurateur Matt Levine and former partner DelShah Capital. Levine is suing for $20 million, claiming they “used his good name” to build a nightlife empire throughout their properties, the most successful of which was two-year-old Sons of Essex. Shah gave Levine the boot back in March, which precipitated the litigation.
According to the Daily News, the most serious charge here is that Shah hired a convicted felon – accountant Victor Jung – who reportedly filched from the business, filed fraudulent paperwork, and tapped into restaurant resources to host fundraisers for mayoral candidate Bill de Blasio. Jung did hard time in federal prison five years ago for stealing $1.3 million from NBC Universal.
We had a look at the 250-page court papers. Here are some additional tidbits:
- According to Jung, Sons of Essex was on pace to do 4x the amount in 2013 as the previous operator [Mason Dixon]. The establishment was averaging roughly ’75k-90k’ a week. According to the lawsuit, Jung would even direct events that came through to Sons of Essex to other venues that DelShah owned.
- According to the lawsuit, Shah also had fraudulent leases at the locations to obtain better financing rates, used Levine’s rep to get better refinancing, and upon information and belief, even used the signature page from his original lease, raised the rent at Sons of Essex without him knowing, and took out an additional $112,378.50 in rent without him knowing.
- DelShah apparently breached Levine’s contract by putting his own accountant and book keeper (Jung).
- Shah writes in an email on February 25th, 2013: “If Matt and Victor can get on the same page, we could be quite unstoppable.” March 3rd, 2013 Shah writes “come up with a solution re victor/tension and plan to move forward? You guys need to functional if we are going to build this [indieFORK] into a $100m revenue company, which is my goal.”
- Matt Levine owns the Sons of Essex trademark 100%; he’s on the liquor license as 50% partner for Sons of Essex, 50% at 19 Stanton Restaurant, LLC and 50% 61 Gansevoort Restaurant, LLC.