Scandal-Plagued Restaurant on Hudson Files for Bankruptcy

Many factors can force a business into bankruptcy. The most common reasons for a business to seek bankruptcy protection is too many debts and insufficient revenue. Shoddy business practices can also be an underlying cause. A popular restaurant on the Hudson River, La Marina, recently filed a Chapter 11 bankruptcy petition amid a blizzard of unpaid claims and allegations that its manager was involved in a city hall scandal involving Mayor Bill DeBlasio.

La Marina’s liquor license was suspended last fall, and one of its managers was arrested on drug-related charges. The restaurant is located on city parkland in Inwood, and a number of critics have been calling attention to the fact that the restaurant’s owner made several sizable donations to de Blasio’s recent campaign.

The restaurant is also facing a handful of run-of-the-mill business problems. According to its bankruptcy filing, it owes more than $600,000 in unsecured debt. These debts include $116,000 in deposits accepted for future event, none of which has been repaid. The restaurant also owes $221,676 in delinquent rent to the City Parks Department. The restaurant also owes hundreds of thousands of dollars to vendors and utility and service providers. Critics are also complaining that the restaurant’s close connection to the mayor and to City Hall resulted in a looser enforcement of the City’s restaurant ordinances.

The clouds that hang over the restaurant’s future are discouraging customers from booking events there. While the restaurant has promised to return deposits, customers have been more active in trying to recover their money than in trying to book more events. One of the restaurant’s owners recently sent an e-mail saying that the owners plan to re-open the restaurant in May “as we normally do for the season.” Time will tell.