JL Ivy restaurant case
By: Lauren Otis – Staff Writer
A Mercer County state Superior Court judge has signed an order turning over the JL Ivy Bar liquor license to one of the failed restaurant’s partners, Ewing-based real estate developer Theodore Golfinopoulos.
The liquor license, with an estimated value around $1 million, is the only remaining asset of significant value from the upscale Princeton Township restaurant and bar that closed in 2009 amid allegations of mismanagement on the part of managing partner Edmond "Jean Luc" Kleefield.
Mr. Keefield has sought in court and outside to clear his name, alleging he was the victim of a pattern of fraud by other investors and participants in the JL Ivy venture, including Mr. Golfinopoulos, a former fraternity brother of Mr. Kleefield’s at Franklin & Marshall College. Mr. Golfinopoulos has alleged Mr. Kleefield engaged in poor oversight and financial management, attempting to pass hundreds of bad checks in the process of driving the restaurant to a fiscal point from which it could not be rescued.
Mr. Kleefield denied that he had passed bad checks, saying they were covered by a bank overdraft agreement.
Last week, Judge Douglas Hurd signed an order which "basically says that I am the legal owner of the liquor license," Mr. Golfinopoulos said. Mr. Golfinopoulos said in 2007 he had guaranteed a loan for both the JL Ivy restaurant and bar, both separate legal entities.
Under the indemnification agreement, if Mr. Kleefield, as majority owner of the JL Ivy entities, and Stephen Distler, the minority owner, defaulted on the loan and he satisfied the bank’s interest, he became legal owner of the entity, including the liquor license, Mr. Golfinopoulos said. He said Mr. Distler, a founding partner in The Bank of Princeton and current majority owner of elements restaurant in Princeton, retained a small interest in a liquor license he owned previously and sold to JL Ivy.
In an e-mail message, Mr. Distler said he had no comment on the JL Ivy litigation.
"I was only given a residual interest in the entities in lieu of full payment for my liquor license (they paid cash for a certain amount)," Mr. Distler said in the e-mail.
"Unfortunately, the judge ruled just on the loan documents," Mr. Kleefield said. "The parameters on what could be done was so narrow he didn’t have an opportunity to rule on anything else," he said.
Mr. Kleefield said when a judge’s order gave Mr. Golfinopoulos control of JL Ivy briefly before it was shut down, Mr. Golfinopoulos deliberately defaulted on the bank loan so he could scoop up the liquor license for the sum of the loan, which was half what the license was worth, and then collude to set up a new restaurant on the JL Ivy premises.
"It’s a blatant fraud. It’s an outrage," Mr. Kleefield said. The allegations were denied by Mr. Golfinopoulos.
"There is no way I could destroy the restaurant in one week (between taking over control of it and closing it down)," he said. "Unfortunately, Mr. Kleefield did that on his own, as managing member."
Mr. Kleefield said he was keeping his options open regarding further pursuit of his allegations against Mr. Golfinopoulos and others through the civil court system, but had also reached out to other parties in the matter to see if a mediated solution could be arrived at.
lotis@centraljersey.com