(Image: Thomas Street Bistro via Facebook)

About two years ago, Adam Freeman of Thomas Street Bistro decided to sell out. Frustrated by the ongoing challenge of bringing new customers into his tiny Capitol Hill restaurant, he turned to daily deals to drum up new business. “I was the first to be on Groupon when they started in Seattle,” Freeman tells CHS. What has followed has been an absolute cavalcade of discount offers in nearly every shape and form for the restaurant at Summit Ave and Thomas.

“We have the most daily deals in the city,” Freeman said. “You start with Groupon. And then LIving Social came. ‘Why don’t you run?’ And then Tippr.” They just follow each other.” In all, CHS counted ten different Thomas Street deals in the last 18 months — some selling more than 1,000 of the coupons. Freeman says there were even more deals than that. But, now, something has gone wrong. The biggest daily deal dealer of them all has suddenly pulled the plug on Freeman’s bistro.

“Without your call, we wouldn’t have known,” Freeman said of a brief conversation on Monday about this customer service email passed along to CHS by reader — and Thomas Street Groupon holder — Daniel:

—————————- Original Message —————————-

Subject: An Important Message Regarding Your Groupon for Thomas Street Bistro

From: “Groupon”

Date: Mon, February 20, 2012 4:18 pm

————————————————————————– Thanks for purchasing the Groupon for Thomas Street Bistro. Due to unforeseen circumstances, we have had to cancel this deal. Werealize how frustrating that can be and we want to make it right as soonas possible. Our apologies for the inconvenience. If you haven’t used your Groupon, you are eligible for a refund. Toclaim your refund, sign into your Groupon account atwww.groupon.com/mygroupons. From here, click “Claim Refund” and select arefund either to the form of payment originally used for the purchase orto your Groupon account to be used for future purchases. If you purchased this Groupon as a gift or are having trouble claimingyour refund, please contact us at www.groupon.com/support and we’ll beglad to assist you. We appreciate your understanding and sincerely apologize for anyinconvenience this may have caused. Sincerely, Groupon Customer Support

Our call may have been the first. But Freeman said hundreds have followed from Groupon holders who want to know what is happening with his restaurant. “80% of our customers use their Groupons in the last two weeks [before expiration],” Freeman said. “We are going to honor them.” The decision, by the way, is made easier by the fact that Freeman says he has already been paid by Groupon and won’t have to give a penny back.

The restaurant owner said he has no idea why Groupon is refunding his business’s deals. He says he has no plans to close the bistro and that Groupon has not contacted him about the situation or any complaints about the service he offers at the restaurant.

We have an inquiry out to Groupon about the Thomas Street situation but have not yet heard back. This would also be a good time to mention that Thomas Street Bistro has also advertised on CHS in the past. UPDATE: A Groupon spokesperson tells CHS that the deal was removed because of customer complaints about service and quality at Thomas Street. She also said the company has made numerous efforts to contact the business about the situation including working with Freeman to improve the experience at the bistro but Groupon’s calls and messages were not returned. Here is a statement on the situation from Groupon:

Groupon contacted the merchant several times without response when it became apparent that Thomas Street Bistro wasn’t providing the level of service that we expect for our customers. With customer complaints rising we had no choice but to pull the deal and proactively contact purchasers for a refund if they haven’t redeemed.

Freeman readily admits his restaurant has been almost absurdly active with coupon and discount offers. “It hasn’t been the best time for Capitol Hill businesses,” Freeman said. “I’m very hidden there [on Summit Ave]. It gives awareness. And it’s kind of a reward to my regulars.”

One complicating factor could be Freeman’s involvement in the daily deal space that goes well beyond his restaurant business. In spring 2011, he partnered on the launch of a venture called Pricemobster:

Pricemobster is the brainchild of Seattle restaurateur Adam Freeman, owner of Thomas Street Bistro. After using a number of the online group-buying coupons to promote his restaurant, he became concerned about the high payout to the coupon companies and the low return for the merchants. In fact, he realized that while the business owners received a large influx of cash all at once, many were actually losing money and not gaining either customer loyalty or appreciation.

Pricemobster displays deal promotions for several local businesses including a few on Capitol Hill but none of the offers are currently available for purchase. One offer, by the way, touts a deal dated February 2nd for a coming soon “Thomas Street Crepery”:

Even with his involvement in Pricemobster, Freeman said the days of daily deals are done when it comes to Thomas Street.

Built up by expectations set by snappy advertising copy that disguises bread and butter as a course and dropped into a restaurant space and experience that can only be described as “quirky,” reviewers on sites like Yelp for Thomas Street are increasingly brutal. “There is some positive that came out of it,” Freeman said. “There are also a lot of negatives.”

“I think we achieved what we wanted,” Freeman said. “We achieved enough return business from those daily deals. We think what is best now is to go back to being a small neighborhood business.”

Whatever its reasons, Groupon appears to have helped Thomas Street move forward on its new goal.