Tuesday, December 13, 2011

I Spotted . . .

. . . this sign today:

In this window downtown:


Anyone know what that's all about?

3 comments:

  1. What the...?? Will be interesting to see where this goes, and what it means. Interesting little poignant, bitter note about Jody (Merenda). He was not the first -- nor last -- to go bankrupt, unfortunately.

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  2. it's in reference to a personal cash loan taken by gatsby's to expand into the old astro space; a very large loan to another business owner in bend who will never see the return. it's his only outlet of frustration i imagine.

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  3. Ah -- had I been reading the Source Weekly as assiduously as I should have done, I'd have seen this:

    "The list of creditors is extensive and McMichael’s filing stretches more than 70 pages. The debts range from minor bills associated with daily operations [...] to substantial debts to his individual investors and financial institutions, including the Banks of Cascades [CACB].

    "One of those investors is James Orsillo, owner of Amalia’s Restaurant downtown. Orsillo invested money with McMichael over the past several months, even as McMichael’s restaurants were struggling to remain open. [...]

    "Orsillo said he loaned and invested thousands of dollars with McMichael with the understanding that they would be opening a joint venture in the former home of the Astro Lounge, which moved several blocks away on Bond earlier this year, and Gatsby’s, which Orsillo planned to convert into an Italian-style restaurant with an adjacent bar, dubbed the Ruby Room, in the former Astro digs. That project never got off the ground. When Orsillo returned from vacation recently, he learned that McMichael was preparing to file for bankruptcy.

    "McMichael’s bankruptcy filing indicates that Orsillo is owed roughly $313,000. However, both he and McMichael indicated that the actual debt is lower based on a pair of investments that Orsillo made with McMichael in the failed Bourbon Street and the joint venture involving Gatsby's.

    "At this point, Orsillo is not sure how much, if any, that he’ll recover, but he hasn’t dismissed the idea of pursuing civil or criminal charges. McMichael dismissed the idea of any criminal wrongdoing and said he is working to pay off outstanding debts related to Bourbon Street's closure using his personal funds."

    (http://www.tsweekly.com/pdf/blogs/bent/Former-Blacksmith-and-Bourbon-Street-Owner-Files-for-Bankruptcy.pdf)

    That clears that up.

    Most of the loans appear to be unsecured.

    Handshake loans.

    Something tells me that CACB didn't make that mistake. They will be standing at the front of the line at the creditors meeting unless there are representatives of the United States Department of the Treasury (IRS) and the Oregon Department of Revenue. Those guys always get first dibs.

    When I first heard of McMichael's sudden growth of restaurants (Bourbon St., Gatsby's, &c.) I wondered whether he was overreaching in a bad economic climate. He will not survive the expansion, I thought (not that I'd want One Restaurateur to Rule Them All here in Bend, as Bourbon Street wasn't an improvement to the restaurant scene at all; and McMichael's "takeover" of the Staccato space seems to have occurred under fishy circumstances, see http://www.hackbend.com/2010/06/24/more-behind-bourbon-street-staccatos-closing.php).

    One of Jack's little birds downtown said that McMichael's plan was to build up a small stable of restaurants and flip them.

    Guess the debts caught up before the restaurants were ready for sale.

    One of Jack's rules, ranking along with: "Never go to a second location with a lawyer," and "Just because a stripper laughs at one of your jokes, it does not mean that she likes you," is "Never loan money to a restaurateur."

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