2 Valley Eateries In Bankruptcy
Woodstock — Although the Bentleys and Fire Stones restaurants have closed and appear to be permanently shuttered, one of the owners said yesterday the long-standing eateries would reopen and an application for new owners to take over the liquor license at Bentleys was approved Tuesday night by the town’s selectboard.
“Plans are in the works that we will reopen. I can’t say anything beyond our (Sunday) press release right now, but we will have more to say in the future,” said David Creech, one of the current owners of both restaurants.
On Sunday, Creech and co-owner Bill Deckelbaum announced the abrupt closing of both places, citing financial “irregularities” too “insurmountable” to overcome and keep the businesses running.
Creech and Deckelbaum ran Bentleys under Mountain Trading Co. and Fire Stones under Bentleys of Quechee, Inc. Both corporations voluntarily filed for bankruptcy Tuesday under Chapter 7 of the federal bankruptcy code, court records show.
Also on Tuesday, the Woodstock Selectboard approved an application for a liquor license for Bentleys filed by Stonewall of Woodstock Corp., owned by part-time Barnard resident John G.F. Ruggieri, Selectboard member Bruce Gould said. Ruggieri, who owns the Stonewall Lodge in Barnard, couldn’t be reached for comment last night.
Creech and Deckelbaum opened Bentleys in 1976, quickly establishing the restaurant at the crossroads of Route 4 and Route12 in the center of town as a prominent part of the local dining and entertainment scene. The partners opened Fire Stones in Waterman Place in Quechee in 1987 and it became a convivial watering hole for the neighborhood. In recent years, the partners had taken less active roles in the business, leaving the day-to-day operation to a third owner, Robert Crowe.
Financial troubles surfaced publicly for the restaurants in July 2010, when the businesses’ comptroller Michelle Storms, of Tunbridge, was charged with embezzling $178,000. Storms plead guilty in Windsor Superior Court in March 2011, and was sentenced to one year in jail.
Further financial problems came to light in December last year, and Creech and Deckelbaum stepped back in and terminated Crowe and an employee, according to court records and news releases. They then hired a new accounting and restaurant management team in an effort to turn the businesses around, the records say. Crowe could not be reached for comment yesterday.
“The financial information we discovered was just too troubling to have done anything else ... We had been working non-stop since to determine if there was any way we could save the businesses. Even when we realized the magnitude of the damage to the business, it was still not easy for us to make the decision to close,” Creech said in Sunday’s news release.
In the bankruptcy filings, Mountain Trading Co. listed assets at Bentleys of $83,407 and liabilities of $1.6 million. Fire Stones listed assets of $33,280 and liabilities of almost $1.3 million.
The two creditors at both restaurants with the biggest claims are the IRS and the Vermont Department of Taxes. Along with the Vermont Department of Labor, which collects employment taxes, the agencies are owed a total of $649,107 at Bentleys and a total of $539,568 at Fire Stones, the filings show.
A number of other creditors holding unsecured claims are owed about $850,000 at Bentleys and $600,000 at Fire Stones, the records show.
Stonewall of Woodstock, which was approved for Bentleys’ liquor license extension, is noted in the filings as having acquired the assets of a debtor for $25,000 at Bentleys and $15,000 at Fire Stones.
Bentleys also showed gross annual revenues of slightly more than $2 million in 2011 and $1.8 million in 2012. This year, the restaurant grossed almost $334,000 before closing Saturday night. Fire Stones grossed $1.3 million in 2011, $969,000 last year and $205,000 since the first of the year.
A company that is deeply in debt and unable to pay its creditors can file under Chapter 7, which means it is ceasing to operate. A trustee has been appointed to sell the restaurant’s assets and distribute the proceeds to the creditors. A creditors’ hearing is scheduled for April 1 at 9:45 a.m. in the Vermont District of U.S. Bankruptcy Court in Rutland.
Warren Johnston can be reached at email@example.com or 603-727-3216.