Dan Story visited a lawyer for the first time Friday because his former employer didn’t give him, or any of his co-workers, a final paycheck after 9th Street Cafe closed more than a month ago.
Meanwhile, the owners are being sued by their former franchise, the state placed a tax lien against their property, and their landlord, John Ott, wants to know if he should start looking for a new tenant.
And one of the original partners allegedly walked away with $2.5 million of the ownership’s money.
9th Sreet Cafe, formerly 9th Street Noodles and Nothing But Noodles, closed March 6. Its owners kept a profile so low, former general manager Story said he only knew the owners’ first names: John and Lisa.
John Colonder and Lisa Shoemake, of Des Peres, are the active owners of 9th Street Cafe. They, along with Kathryn Hunt and Steen Bindslev, of Florida, and Carey T. Mulwee, of St. Peters, are named as owners in the lawsuit and tax lien. Hunt and Bindslev appear to be silent partners. Mulwee was a partner, but his association was dropped because he filed for personal bankruptcy, according to the lawsuit.
None returned phone calls Monday seeking comment.
“They were kinda doomed from the beginning,” said Bob Lescher, of Holder Group in St. Louis. The company was listed as a reference on the 9th Street Cafe’s business license. Lescher said he did the kitchen design and installed equipment for the restaurant when it opened in October 2004. He said he met a person who acted as a partner but could not recall his name.
Lescher described him as a quiet person who had the restaurant’s managers do all of the talking. Lescher said investors in the restaurant told him that the partner didn’t put down money and paid for everything by credit.
“He gave all indications he was involved,” Lescher said. “When he walked out, he hadn’t signed anything. They went to the attorney general, the FBI, the IRS. The fact remained he didn’t sign anything, no legal agreements, not the lease, no legal documents. They had more or less willingly given him $2.5 million.”
Ninth Street Partners, the limited liability partnership the owners formed, signed franchise agreements to operate two Nothing But Noodles restaurants, in Columbia and St. Peters.
Part of the agreement requires a 6 percent royalty fee and .5 percent national advertising fee.
Noodles Development, the corporate owners of Nothing But Noodles, based in Scottsdale, Ariz., canceled the franchise contract on Jan. 11, 2006, because Ninth Street Partners hadn’t paid the royalty fee since the previous October.
The restaurant changed its name to 9th Street Noodles and was listed in the phone book as Noodles of Columbia. Noodles Development filed a lawsuit against Ninth Street Partners in Missouri Eastern Federal District Court on April 26, 2006, for violating the termination
agreements of the franchise contract and violating federal trademark laws.
According to the lawsuit, Ninth Street Partners agreed not to own or operate a “fast-casual restaurant that serves noodle-based dishes” within 10 miles.
Noodles Development alleges the menu remained identical. They say the furniture, dishes and to-go bags didn’t change, either.
Mario Herman, the attorney for Ninth Street Partners who specializes in franchise law, said the lawsuit was an attempt to put Ninth Street Partners out of business.
Ninth Street Partners filed a counterclaim alleging that Noodles Development used false earnings statements to get them to sign a franchise agreement and misrepresented facts.
After filing the countercomplaint, the defense attorneys and plaintiffs reached an agreement in December for the restaurant to change the name to 9th Street Cafe.
“They want us to change the name and menu so it was not pasta-based,” Herman said. “We agreed to change, but litigation continued.” He said the defense was trying to negotiate a settlement to end the suit.
It is still ongoing.
Herman said he did not know if the lawsuit was related to the restaurant’s closing.
It is also unclear if the tax liens placed against the owners are related to the restaurant’s closure. The tax liens were placed for failure to pay state sales tax generated by the restaurant.
Jim Brentlinger, administrator of Missouri’s Taxation Bureau, said liens are essentially a freeze on the sale of business property until the amount is paid. The amount of the lien is the amount of the unpaid sales tax.
There have been $53,478.06 in tax liens placed against members of Ninth Street Partners since January 2006.
Bindslev, Colonder, Hunt and Shoemake were placed under a $21,923.25 tax lien on Feb. 5 and a $10,973.81 lien on March 12 in Boone County, according to the Recorder of Deeds Web site.
There were five tax liens totalling $20,581 between Jan. 3, 2006, and July 31, 2006, placed on Carey Mulwee. All of the liens were released by Aug. 15, 2006.
An owner must pay the lien prior to selling the property, or as part of the property’s sale.
Brentlinger said if the business doesn’t own its location, the lien is attached to the owner’s personal property. Ninth Street Partners rented its space on 29 S. Ninth St. from John Ott, who said he is waiting to hear from the tenants whether they will open another business there.
The tax lien against Colonder and Shoemake was placed on their house at 653 Wyndham Crossing Circle in Des Peres.
The house was listed for sale with Coldwell Banker Gundaker in St. Louis on Feb. 22, but the first day it could be shown was March 6, the same day 9th Street Cafe closed. It is listed for $725,000.
It is unclear if the financial and legal woes of Ninth Street Partners are the reasons for the restaurant’s closure. And Story said he doesn’t know why the restaurant he worked for three years closed.
But he knows one thing. He wants to get paid.
Story visited the Student Law Center at MU last Friday to discuss with a lawyer what former employees need to do to get their paychecks.
Story said the lawyer told him they couldn’t do a class-action lawsuit because they didn’t owe him enough money; instead they have to sue individually.
“It's a lot of work to get our $200-$500 paychecks,” Story said.