Arizona restauranteur responds to allegations of misappropriating funds
Popular Arizona restauranteur Julian Wright is embroiled in a bitter battle with former managers who claim Wright misappropriated funds.
Wright responded to those allegations by accusing the former managers of misappropriation.
Wright owned the Gringo Star Street Bar, which subsequently closed without notice to investors. Wright’s limited liability company is Fork & Dagger, LLC., listed as “manager” in legal documents.
Whiskey Rocks Tempe, LLC, is a limited liability company organized for the operation of the Gringo Star Street Bar. True Gentlemen, LLC (“TL”) is a member of Gringo, hence, Fork & Dagger is one corporation. Operating under it is Whiskey Rocks Tempe, and under that True Gentlemen.
Wright’s rebuttal contends: “Throughout the past year, TL (Gringo Star managers) has alleged and asserted to other Gringo members that “manager” (referring to Wright) had engaged in fraud and other improprieties, and had overcharged for corporate overhead and other expenses. Most recently, in the course of soliciting other members to contribute to an alleged litigation fund being amassed by TL. It stated it would be filing a ‘public complaint’ against Manager for its alleged wrongdoing.”
As previously reported, investors in the Gringo Star Street Bar are still awaiting a return on their investment.
Overview of the case
The bar opened in 2013, offering arcade games, food and drinks, dancing, and street art. The 6,500-square foot bar on the corner of 5th Street and Mill Avenue was once home to the Library Bar and Grill, another of Wright’s establishments. Gringo Star’s opening was highly anticipated from both a consumer and investor standpoint. Mill Avenue is popular for its unique taverns and nightlife, which draws patrons from nearby Arizona State University. From an investment standpoint, it appeared to offer a good return.
The following allegations were set forth in Wright’s response:
- Pursuant to the agreement of the parties, Manager permitted two of TL’s Members, Hartley Rodie and Stephen Sperry, to conduct and oversee Gringo’s day-to-day business.
- While Sperry and Rodie operated Gringo’s business successfully and profitably between 2013 and 2016, Gringo’s net income declined significantly after 2016.
- Upon information and belief, Sperry and Rodie neglected their duties to Gringo upon their potential involvement in other restaurant ventures.
- Sperry and Rodie also engaged in excessive participation or giveaways of Gringo’s property, giving away food, drinks and other property of Gringo in “comps” totaling $1,027,902.00 out of total gross income (including comps) of $10,548,451.00.
- Although Sperry and Rodie controlled the day-to-day operations of Gringo, Manager provided oversight, corporate-type and administrative services and caused an outside bookkeeper and CPA to pay bills and handle other accounting matters for Gringo.
Wright maintains that all finances are properly accounted for.
The matter is expected to go to arbitration.