On December 22, 2015, Ramzy Hattar, who owns stakes in River Pig Saloon, Kachka, and Lardo, filed a lawsuit against ChefStable founder Kurt Huffman, Lardo chef Rick Gencarelli, Lardo Holdings, LLC., and Lardo Bakery, LLC. Huffman, Gencarelli, and Hattar each own stakes in Lardo East and Lardo West, and Hattar is seeking 1) to have a judge compel Huffman and Gencarelli to sell him Lardo East and Lardo West, which he values at $1.6 million, and 2) a ten-percent stake in Lardo North.
According to the complaint, Huffman and Gencarelli tried to cut Hattar out of Lardo North while using $200,000 of Lardo's assets without Hattar's permission. Speaking with WWeek, Huffman denied trying to cut Hattar out of Lardo North and said Hattar consented to how the $200,000 was spent. Huffman has also said the lawsuit was the result of a management dispute; that Gencarelli owns all of the intellectual property of Lardo; and that Hattar's lawsuit is damaging the company. Speaking with the Oregonian, Huffman said, "Ramzy has been pressuring us to buy him out for a very high amount for several months."
Speaking on the record about the details of the case for the first time, Hattar says that the Lardo North located at 4090 N Williams Ave. was never supposed to be a Lardo. "It was supposed to be a ChefStable bakery," says Hattar. Hattar claims that Huffman tried to get a loan for the proposed bakery but it fell through, and Hattar claims that's when Huffman used Lardo East and Lardo West as guarantors to get a loan for the bakery, something Hattar says Gencarelli agreed to. This is when Hattar asserts that at least $200,000 of Lardo's assets were used without his consent.
Regarding the claim that he was cut out of Lardo, Hattar says his ownership in Lardo was removed when Huffman and Gencarelli created two new LLCs, Lardo Bakery, LLC and Lardo Holdings, LLC. Hattar says Lardo Holdings, LLC holds "all of the rights of Lardo," and when it was created with a new operating agreement, Hattar's "ownership in Lardo was removed."
Hattar says Huffman should have bought him out of Lardo East and Lardo West per the original operating agreement. "When it became clear that Kurt either didn't want me as a partner in Lardo or didn't value my partnership," says Hattar, "that should have been the point when he should have either tried to buy me out—because we have buy-out clauses in the operating agreement."
Hattar also responded to a statement published by the Oregonian that read, "Huffman and Gencarelli say Hattar negotiated an agreement to bring Lardo to Providence Park without their permission." The article reads that Huffman and Gencarelli first learned of the potential Lardo location when Portland Timbers owner Merritt Paulson sent out a tweet about it (Paulson has since deleted the tweet). Hattar denies this, saying Gencarelli was involved in the negotiations and that he and Gencarelli were discussing the idea before Paulson's tweet.
"This is about having a judge decide what is legal and not legal," says Hattar. Hattar is seeking to buy out Huffman and Gencarelli for $1.6 million and says the buyout "will provide the funding to pay off the remaining debt [...] and prevent the company from defaulting on its loan with the bank." He also says, "In the three-plus years that Lardo has been in operation, I have not received a single dollar."
"Rick is a great chef and guy," adds Hattar. "I still like him a lot."
As more details continue to emerge, it's clear the lawsuit isn't going away. Lardo is one of Portland's best-known restaurants, and it began as a food cart operated by Rick Gencarelli in 2010. It opened its first brick-and-mortar on SE Hawthorne in 2012.