The U.S. Bankruptcy Court notice is still posted on the padlocked gates of Old Pueblo Grille a week after the court seized the restaurant from Bob McMahon in an ongoing bankruptcy dispute.
But McMahon’s attorney, Scott Gibson, said a buyer is waiting in the wings to purchase the restaurant. No details have been released and the attorney for the court-appointed trustee, Christopher Linscott, could not be reached for comment on Wednesday.
Linscott is one of two trustees named to handle the dissolution of McMahon’s Metro Restaurant assets. He is responsible for selling Old Pueblo Grille, 60 N. Alvernon Way, and McMahon’s Prime Steakhouse, 2959 N. Swan Road. Gayle Eskay Mills was assigned the task of selling the physical property (kitchen equipment, tables, chairs, etc.) from both restaurants.
“There are a lot of moving parts,” Gibson said when asked if the potential Old Pueblo buyer would bring McMahon back in to operate the restaurant.
According to court records, Linscott received an offer for “not less than $1.15” million from a “bona fide purchaser.” It’s not clear if that offer is the one that is now being considered; Linscott’s attorney could not be reached Wednesday to comment.
Meanwhile, McMahon said there was nearly $40,000 worth of fresh food — meats, dairy and vegetables — left at the two restaurants when the court closed them on May 28. He said he was told that the food would be donated to the Community Food Bank of Southern Arizona. But as of Wednesday, food bank officials said they had received no donation.
Last week’s seizures came after McMahon had exhausted appeals to several court actions that resulted in converting his year-old Chapter 11 bankruptcy reorganization into a Chapter 7 bankruptcy, which calls for liquidating his assets.
McMahon said that in addition to seizing the restaurants, the court also seized a company bank account with $180,000. Part of the money was going to be used to pay employees, who were due to be paid last Friday, he said. Those employees — 150 full- and part-timers between the two restaurants — have still not been paid and won’t be until the bankruptcy court sorts out who has claim to the money, said Adam Nach, the Phoenix attorney for trustee Mills.
“We cannot pay the employees without a bankruptcy court order, and we can’t even get a bankruptcy court order; we need more information,” he said. “It’s also our understanding that it might be subject to liens by other creditors. So if somebody has a higher and greater lien than the employees, then the employees, unfortunately, won’t get paid out of those funds. But again we are investigating it. We are trying to figure out who has liens on what. It is going to be a process. The bankruptcy code provides for that process and we are following that code.”
McMahon said he was current with all of his vendors, who received automatic payments through his bank. But Gibson said there are people who are “claiming liens” that have to be settled.
“The only people really getting paid money here is the attorneys,” McMahon said.
“I’ve got three kids to feed,” said Metro Restaurants bartender Amber Ravert, who has found a new job with an upscale foothills restaurant. “I have no hard feelings toward Bob at all. I feel really bad, and I feel bad for the other employees. … There are all these people that don’t have jobs and it’s summer, so I don’t know what they’re going to do.”
