The partners who own and run the Rosemont location of Harry Caray’s Italian Steakhouse are squaring off over the restaurant’s finances, as one of the partners claims the others may be maneuvering to squeeze him out of his cut of the restaurant’s proceeds.
Rosemont Partners LLC, managed by investor Roger J. Levin, filed a 10-count complaint Nov. 21 in Cook County Circuit Court against Levin’s longtime partners in the highly successful Harry Caray restaurant business.
Levin and Rosemont Partners own 28 percent of H.C. Rosemont LLC, court documents said. It is suing Sacred Bovine LLC, which is managed by businessman Thomas McGuigan and owns the remaining 72 percent, and Creative Hospitality Enterprises, an entity run by Grant DePorter, who is president of HC Management, the corporation set up to manage the Rosemont restaurant and others operating under the Harry Caray brand.
Levin accused the defendants of willfully violating an operating agreement, as well as breaching fiduciary duties to both Rosemont Partners and H.C. Rosemont.
Levin’s history with the restaurant goes back to 1987, when he and a partner bought land in Chicago’s River North neighborhood and developed the original Harry Caray’s, which was named for legendary Hall of Fame Chicago Cubs broadcaster Harry Caray. In 1997, Levin met with Peter Dumon, then a partner of McGuigan, who purportedly asked Levin to help develop and run a Caray’s in a new Rosemont hotel.
That led to McGuigan and Dumon forming Sacred Bovine, as well as the original operating agreement that gave Rosemont Partners a 28 percent ownership interest, and left 72 percent for Sacred Bovine with 12 percent as Class A and 60 percent as Class B.
The complaint detailed the initial operating agreement, as well as a Feb. 22, 2000, amendment to which both sides agreed and a Jan. 15, 2015, second amendment that Levin said was “unilaterally executed” by Sacred Bovine without his knowledge or consent. He argued this tweak involved “several changes designed to further marginalize (Rosemont Partners)’s role as a member of the company” by, among other elements, eliminating a requirement that the manager get consent of all members before disposing of assets, admitting new members or buying property from Sacred Bovine or its affiliates and deleting a provision granting a member’s right to inspect financial records.
On June 24, 2016, Levin wrote to DePorter seeking information on the restaurant’s financial condition. DePorter wrote back June 11, and Levin, deeming the response insufficient, wrote again on Aug. 22, the complaint said. In October, DePorter’s lawyers purportedly sent tax returns for 2009-2015, as well as several years’ income statements, which allegedly revealed 2014 distributions that did not, per the complaint, go to Levin and Rosemont Partners as he expected.
In addition to a jury trial, Levin wants to be allowed to inspect the H.C. Rosemont books, and that the January 2015 operating agreement amendment be invalidated. Regarding the 2014 distribution, in which Creative gave Sacred Bovine $214,500, Levin argues that constitutes a violation of both the operating agreement and state law. He wants the court to enter judgment giving Rosemont Partners either $83,416 or $104,100, depending on if the money went to Sacred Cow based on its investor status.
Levin further requests a full accosting and disclosure of Sacred Bovine’s records, wants a judgment against Creative Hospitality for a $198,000 loan it made to Sacred Bovine and a determination that, since the loan constituted a distribution, Rosemont Partners should have received as much as $92,4000 of that amount.
For counts of breach of fiduciary duty of loyalty, one against Creative Hospitality and one against Sacred Bovine, Levin requests punitive damages and other relief.
Representing Levin and Rosemont Partners in the matter are attorneys from the Chicago firm of Beermann Pritikin Mirabellii Swerdlove.