Celebrity Chef Jose Garces Hit With Multiple Lawsuits And Restaurant Closures
It may not seem like it from the frequent TV appearances and the 10 restaurants in Philadelphia alone, but Jose Garces' restaurant empire could be on thin ice.
The founder of Garces Group, which operates Philly icons Amada, Distrito and Village Whiskey, has been sued six times in the past eight months, with the two largest lawsuits coming from initial investors in Amada, his first restaurant, the Philadelphia Inquirer reports.
The suits are the most public example of what has been a distressing downward spiral for Garces Group, with a series of failed restaurant concepts putting the company on the brink of financial ruin, according to Philadelphia Magazine.
New Jersey couple Tom and Maria Spinner and North Philadelphia food vendor Jim Sorkin have filed separate lawsuits claiming unpaid returns on investments, and in the case of Sorkin's company, unpaid bills for food deliveries. The Spinners claim that Garces took their investments in his individual restaurants, which they estimate total $2.5M, and funneled it to Garces Group, a move they called "in substance and operation a Ponzi scheme" in their lawsuit.
Garces' struggles began in earnest, according to Philly Mag, with the closure of the Revel casino in Atlantic City, where he operated four restaurants that he said made up an outsized portion of his company's revenue. Restaurants in Chicago; Scottsdale, Arizona; Palm Springs, California; and Washington, D.C.; all went belly-up as well, just like his second Amada location in New York's Battery Park City.
Now, Garces' operations have shrunk to the 10 Philly spots, a Distrito in Moorestown, New Jersey, two restaurants in other Atlantic City casinos and a wine bar in Times Square, but a 21K SF food hall Garces is curating is in the works in D.C. Garces said that he is finalizing plans to address his "financial challenges" in a statement to the Inquirer.
Those plans include more restaurant concepts he mentioned to Philly Mag without being able to include any details, but one possible saving grace could be the upcoming rebirth of the Revel as the Ocean Resort casino, which will include the reopening of three of Garces' restaurants. Its revival corresponds with the transformation of the two casinos directly south of Ocean Resort: the former Trump Taj Mahal into a Hard Rock casino and resort and Bart Blatstein's recently completed renovation of the Showboat.
Garces is also negotiating a deal with Ballard Brands, a Louisiana-based restaurant management company that focuses on fast-casual chains, to possibly take over the business side for all or some of Garces Group's locations. Garces told Philly Mag that he thinks the fit makes sense due to his reaffirmed commitment to taco spot Buena Onda at 1901 Callowhill St., despite a second Buena Onda location having recently closed in the King of Prussia Mall.
