Results: Well Done at Delmonico's
Last week, an eight-year-long legal battle came to a head, with a final judgment entered in favor of our clients, the Grgurev family. The Grgurevs were awarded ownership of New York City's first fine-dining establishment and steakhouse -- Delmonico's Restaurant -- approximately $2 million in cash, and a judgment for $1.7 million more against their former business partners. Eater New York reported on our win here.
This business divorce began in 2013, when prior counsel for the Grgurevs initiated a corporate books and records inspection against the controlling shareholders, who were concealing the successful restaurant's finances. That led to a federal lawsuit, focusing on trademark misappropriation by the Grgurevs' partners, who in the early part of the decade sought to establish competing Delmonico's businesses, cutting the Grgurevs out.
After prior counsel was dismissed, and a third set of counsel withdrew with conflicts of interest on the eve of trial, the Slarskey LLC team came in -- the fourth group of attorneys to attack this problem -- rethought and repositioned the entire dispute, and targeted control of the restaurant itself (not just money damages for trademark infringement). Employing an infrequently-used procedure of New York law, our team sought equitable dissolution of Delmonico's: holding the controlling shareholders responsible for mismanagement and oppressive conduct targeted at the Grgurevs, and forfeiting those shareholders out of the business without liquidating it.
Within a year, the team obtained the appointment of a temporary receiver, completed discovery, and proved shareholder oppression after a three-day hearing in the midst of the COVID pandemic. The special referee appointed to hear the case recommended that 100% of the restaurant be awarded to the Grgurevs, along with all of the cash assets remaining with the business -- and an additional $1.7 million deficiency judgment against the forfeited shareholders.
Our team for this matter was led by David Slarskey and Evan Fried, and was assisted by Sam Dayan and Tyler Kamperschroer.