EMM Group, of popular hotspots Abe & Arthur's, Catch, SL, and Lexington Brass, are facing a lawsuit after an investor claimed they misappropriated funds. The investor, Gregory Struck, is accusing Eugene Remm, Mark Birnbaum, and Michael Hirschtein of fraud and "breaching their respective fiduciary duties to their investors."
According to the lawsuit, in 2008 Struck invested 1 million in exchange for 13 shares during the groups venture of Abe & Arthur's. As the restaurant gained popularity Struck began receiving regular checks totaling $700,000 in the first year. As time went on the check amounts started to dwindle until eventually they stopped altogether in 2011-- coinciding with the time frame that plans for Catch were announced. Leaving Struck to believe they used profits from Abe & Arthur's to start another business instead of paying out to investors. Stuck also believes the group underhanded him by kicking him out of the company for "violating terms and conditions of his investor agreement" when he attempted to recruit an EMM employee for one of his own ventures. Even though he claims he made it clear to EMM that he planned on starting his own venues eventually.
He also claims the remainder of his investment, $300,000, was never returned as promised. Struck is seeking damages as well as compensation for the fair market value of Sutol. He is also asking for restoration as an investor in the company and demanding that a receiver replace Birnbaum and Remm as fiduciaries of the company.
As big fans of EMM Group, we hope this gets settled peacefully!