Treadsack restaurant group seeking bankruptcy protection

Patrons pack the bar at Hunky Dory. The owners of Hunky Dory and its sister restaurant Bernadine's announced the restaurants will close May 24.

Patrons pack the bar at Hunky Dory. The owners of Hunky Dory and its sister restaurant Bernadine's announced the restaurants will close May 24. Photo: Mark Mulligan, Staff Photo: Mark Mulligan, Staff Image 1 of / 78 Caption Close Treadsack restaurant group seeking bankruptcy protection 1 / 78 Back to Gallery

UPDATE: On March 30 Treadsack co-founder Chris Cusack posted this on Facebook:

"First thing's first: Hunky Dory, Bernadine's, Down House, D&T, and Johnny's are open and will continue to be OPEN!

We've filed Chapter 11 for Hunky Dory and Bernadine's so we can restructure our debt and continue to operate. This was a very difficult decision, but the chance to save the businesses that all of our employees have worked so hard to build and so many of our guests have supported made it so obvious that this is worth fighting for. "We opened these businesses with the goal of creating great experiences in our neighborhood, the Heights. We want to be great employers and a positive force as small business owners in this community. Since our expansion over the last few years we have hit plenty of stumbling blocks. We've done our best to own up to our mistakes and struggles while balancing our responsibilities to our employees, our guests, our vendors and our investors. Without their support none of this would be possible. Our goal is to continue to service these responsibilities as faithfully as we can. "If you believe, as we do, that having these businesses is a good thing for this neighborhood I would ask you to continue to do what you have always done, and support us by dining in our restaurants and drinking in our bars. In doing so you are supporting the more than 200 people across all companies who rely on these businesses for their livelihood and helping to preserve independent businesses in the Heights. We thank you for the opportunity to serve you over the last year and we look forward to seeing you very soon."

The fortunes of the Treadsack restaurant group, once held up as a shining example of culinary entrepreneurship, continue to darken.

Mothership Ventures, LLC, whose officer is Treadsack co-owner Chris Cusack, filed for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court Southern District of Texas on March 26. According to court documents Mothership Ventures includes Hunky Dory and Bernadine's restaurants.

JANUARY: Chef Richard Knight leaving Hunky Dory

The move follows months of speculation about the fate of Treadsack and its bar and restaurant holdings, including Bernadine's, Hunky Dory, Down House, D&T Drive Inn and Johnny's Gold Brick, all of which are in the Houston Heights area.

Treadsack, co-owned by Cusack and partner Joey Treadway, suffered withering blows in a January 2017 Houston Press article reporting that the Texas Comptroller's Office was threatening to seize Treadsack's cash for back taxes, and that the IRS hit the business with $1.1 million in liens.

DECEMBER: Foreign Correspondents closes after its founding chefs depart

According to reporter Craig Malisow, the company's financial problems were probably a result of the brisk expansion Treadsack undertook when it opened Hunky Dory in October 2015 and Bernadine's in December 2015, followed by Canard in March 2016.

Treadsack already was in the news in January when Hunky Dory chef Richard Knight announced he was leaving the restaurant. That news came after the well-publicized departure in December 2016 of chefs PJ and Apple Stoops from Foreign Correspondents restaurant, which they opened for Treadsack in October 2015. The restaurant closed quickly after their departure, as did Treadsack's neighboring bar, Canard.

LAST CALL: Treadsack's Canard closes its doors

On Monday Cusack and Treadway (as well as limited liability companies Down House Ventures and Mothership Ventures doing business as Down House, D&T Drive Inn, Hunky Dory, Bernadine's and Foreign Correspondents) were sued in Harris County District Court by an investor seeking the return of a $60,000 investment in the Treadsack businesses.

In the lawsuit, Richard Rothfelder (an attorney with Rothfelder & Falick LLP) contends he was entitled to monthly payments of a percentage of net sales from Down House, D&T Drive Inn, Hunky Dory, Bernadine's and Foreign Correspondents according to his investor financing agreement with Down House Ventures and Mothership Ventures. Those companies and its principals guaranteed repayment of Rothfelder's investment within 48 months of his investment made in August 2014. According to the suit, the payments were "sporadic and inconsistent" and "ceased entirely at least as early as May of 2015."

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The breach of contract suit additionally seeks at least $20,000 plus pre- and post-judgment interest.

Cusack responded via email, saying that Chapter 11 debt consolidation will work in Treadsack's favor: "The businesses will stay open, employees will continue to work and be paid, and we'll serve our guests in the same delightful fashion that everyone knows and loves. Only now we'll be able to take some of this debt and pay it down in an orderly fashion. I know it seems weird to say this, but I feel great about the decision. I love my restaurants and my staff and I'll do everything to fight for them and the right to continue doing business."