Chef Kevin Rathbun is being sued by two of his restaurant partners who are alleging he is trying to force them out at a price below market value.
Clifford Bramble and Kirk Parks filed suit against Rathbun (the chef behind Rathbun’s, Kevin Rathbun Steak, Krog Bar, and KR Steak Bar) in Fulton County Superior Court on February 13 claiming the chef is trying to force a buyout not authorized under the company’s operating agreement. Bramble and Parks also claim the compensation offered to them in the buyout was below fair market value. The pair holds minority ownership in the restaurants; Rathbun holds the majority ownership.
In January, Rathbun notified Bramble and Parks through his attorney of his intentions to buy them out. The pair then received a second notification along with checks in relation to the buyout on February 1, 2018 which they claim were below fair market value.
Parks, who worked as a pastry chef for the restaurants, retired on September 1, 2016. Bramble, who handled the restaurants’ PR and assisted during nightly dining service, resigned on December 1, 2017. Both claim the buyout came as a surprise because neither were terminated from employment, so they believe Rathbun is not within his rights to force a buyout.
The pair have also asked for an appraisal to be done to determine the fair market value of the shares owed them under the terms of the operating agreement, which they say Rathbun has not provided. Speaking through their attorney, David Marmins, the pair claim the amount that would be owed them in a buyout is “significantly higher” than what they received.
It seems part of the dispute stems from the definition of “termination of employment” in the operating agreement. Bramble and Parks claim resignation is not the same as termination. Rathbun, meanwhile, contends Bramble and Parks did want the buyout, but are unwilling to accept the fixed price outlined in the operating agreement. His attorney says Rathbun plans to assert counterclaims against Bramble and Parks.
George Menden, corporate counsel for Kevin Rathbun’s restaurants, told Eater Atlanta, “These two behind-the-scenes minority partners have profited handsomely from Kevin Rathbun’s talent, business acumen, and sweat. But they want more. Kevin Rathbun has paid exactly what the agreements set as the purchase price.”
David Marmins, Bramble and Parks’ attorney, provided Eater Atlanta with the following statement: “They were not terminated by [Kevin] Rathbun, and they never gave up their ownership. Mr. Parks retired and Mr. Bramble resigned to attend to his other interests. We do not know why [Kevin] Rathbun invoked the buy-out clause,...it was a surprise since the agreements do not allow him to take these actions.”
- All Kevin Rathbun Steak coverage [EATL]
- All Rathbun’s coverage [EATL]