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Maple & Ash owners accused of misusing PPP funding

Partners in the high-grossing restaurant are back in court to battle charges from investors who say they are owed millions. Maple & Ash owners call the charges "futile attempts to gain publicity."
Maple & Ash Chicago
Operations at Maple & Ash in Chicago and Scottsdale, Ariz., have not been impacted by the ongoing litigation./Photo courtesy of Googlemaps.

Investors in the high-grossing Chicago restaurant Maple & Ash are back in court, this time trying to stop partners from dissolving the original management group and accusing them of misusing paycheck protection funding.

The latest lawsuit, filed April 24 in Cook County Circuit Court, stems from earlier litigation, but also from a settlement reached earlier this year. After months of litigation, Maple & Ash’s former parent company What If Syndicate partner James Lasky reached a settlement with former partner Dave Pisor, splitting up the group’s concepts. The two locations of Maple & Ash (Chicago and Scottsdale, Ariz.)  went to Lasky, along with the Monarch and Kessaku brands.

Following the January settlement, the management of Maple & Ash was immediately taken over by Maple Manager, a company owned and controlled by James Lasky and his brother Jerald Lasky, according to the investor lawsuit filed last week.

In early April, Maple Manager revealed to investors plans to dissolve the original management group, known as Maple & Ash Management LLC, or MA Chicago.

The group of Maple & Ash’s original investors, led by Dylan Bates of Pope Holdings LLC, however, are seeking an injunction to stop that process.

The investors argue that the move to dissolve MA Chicago would shut them out from the enormous success the restaurant has enjoyed since it opened in 2015.

The stakes are high. Maple & Ash is one of the highest grossing restaurants in the country, with sales of more than $30 million in 2022. The Chicago location  was ranked No. 4 on the annual Top 100 independent restaurants by sister data company Technomic.

The original investor group that became MA Chicago included about 30 investors who raised $3 million to launch the concept.

The lawsuit also argues that Maple Manager dissolved MA Chicago because it did not want to repay millions in loans that it and affiliates “secretly” took—and lied to investors about. And that the partners sought to enrich themselves with liquidation proceeds.

“The decision to dissolve a highly profitable company like MA Chicago is obviously outlandish,” the plaintiffs argued in a filing seeking an injunction to stop the liquidation. “Ordinarily, companies dissolve because their business is failing and there is no reason to continue to doing business. It is unheard of for a profitable business—indeed the fourth-most successful restaurant in the country—to simply dissolve.”

The more recent litigation stems from earlier lawsuits in which Bates and other investors raised concerns about the paucity of distributions from Maple & Ash, as well as the lack of transparency about the use of PPP funding and other accounting issues.

The investors took the restaurant’s management to court in 2022, raising questions about misappropriation of funds at the time, which led to documentation being submitted that revealed $3.9 million in PPP loans applied for on behalf of MA Chicago that the investor group said was never received.

According to the recent lawsuit, those funds were paid to Lasky and Pisor to cover their personal expenses, including country club dues and private jets.

Responding to the charges, Doug Wexler, an attorney for James Lasky, said the PPP funds were properly applied for and were forgiven.

“These allegations are nothing more than a futile attempt to gain publicity for a small group of Unitholders and their attorney’s latest attempt to repackage a frivolous lawsuit that was filed last year,” he said in an email.

Pisor, who in the settlement took ownership and control of the concepts Etta, Celestina and Café Sophie, was not a party to the lawsuit filed last week.

The investors, instead, focus on Maple Manager and Lasky, asking the court to establish a liquidating trustee to oversee the process of winding down MA Chicago and arguing that Lasky and his affiliate companies owe millions to MA Chicago.

“Maple Manager has an obvious conflict of interest in overseeing the winding down of MA Chicago,” the lawsuit said. “A neutral and disinterested liquidation agent should be the one to pursue, collect and distribute MA Chicago’s assets, rather than an entirely conflicted manager that intends to benefit even further at the expense of the investors.”

Maple & Ash’s two restaurants, meanwhile, have not been impacted by the litigation or the shift in ownership, Lasky’s attorney said.

“Guests at Maple & Ash will continue to receive the first-class service, great food and special meals to which they have grown accustomed,” Wexler said.

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